Apple Inc (AAPL) Dividend Increase

Apple Inc (AAPL) announced a 10.6% increase in its cash dividend. The quarterly cash dividend will increase from $0.47 to $0.52 per share and payable on May 14, 2015 to shareholders on record as of May 11, 2015. The annual dividend rate goes up from $1.88 to $2.08. Yield going forward is 1.57%.

In addition to the dividend raise, Apple increased its share repurchase program from $90B to $140B. Apple plans to utilize a cumulative total of $200 billion of cash by the end of March 2017 (Apple’s cash pile now stands at $197B).

From the earnings call:

Apple CEO Tim Cook:

  • This is our strongest March quarter ever. Best iPhone switchers ever. Strong in emerging markets where uint sales were up 63%. Record number of people in App Store, 29% growth. $5 billion in total services revenue.
  • Double digit mac unit growth in a market IDC says was down 7%.
  • Staggering start to fiscal year, runs over the numbers… EPS up 44%.
  • We have made 26 acquisitions in the past 6 quarters.
  • Announcing a significant update to capital return program, upping to $200 billion to reflect confidence in what’s coming ahead.
  • Apple ecosystem continues to expand in exciting ways.
  • Best Buy planning to accept Apple Pay later this year. Will take Apple Pay in its app.
  • 1,000 apps for healthcare. Just this past weekend, Cedar Sinai turned on largest healthkit integration… Over 1,000 researchers have expressed interest in ResearchKit, Apple’s new health research software.
  • Plan to spend $2 billion on data centers in Ireland and Denmark, our largest data centers in the world. App Store has done $7.5 billion for European developers. Data centers on 100% clean energy. Undertaking ground breaking partnership to generate solar energy in China.
  • Also announced plans with a conservation fund to offset impact of our packaging. Apple deeply committed to these initiatives.
  • June quarter off to a great start.
  • All new Macbook just started shipping, happy with response. You have to see it to believe it. A stunning 12 inch retina display … we believe this is the future of the notebook.
  • Second, is the streaming service from HBO. We helped launched HBO Now. Incredibly popular with Apple TV users, a top download.
  • Third, of course, is Apple Watch. Been great to see their reactions. We have seen excitement on social networks. Response has been overwhelmingly positive. There are 3,500 apps available already. Can’t wait to see more of the inspiring apps developers make.
  • I would like to thank developers, customers, and Apple employees. With that I will turn the call over to Luca [the CFO]…

Apple CFO, Luca Maestri:

  • Driven by the iPhone. Impressive in Greater China. All time quarterly record for revenue.
  • GM ahead of our expectations because of stronger than expected iPhone results.
  • Says iPhone 6 and 6 Plus was popular. ASP up $62 y/y. iPhone inventory up 1 million, now in the low end of target inventory.
  • Talking Mac, which was up 10%, led by portables. Ended Q in 4-5 week target range.
  • iPad sell through was 13.7 million, reduced channel inventory by 1.1 million units, left us in inventory target. All time sales record in China, but muted elsewhere. It has been 5 years, and it has been #1 in sales, apps, and customer satisifaction. Also, #1 in enterprise. ChangeWave says 77% of people want to buy iPad.
  • Services revenue up 9%. App Store up 29%. App Store was bigger than Google Play, per App Annie.
  • 22% increase in customer visits to stores.
  • $193.5 billion in cash and securities. Over 171 billion was offshore. Now raised $40 billion of term debt at attractive rates. Retired 13.3 million shares. We have taken action on $120 billion of our $130 billion program.
  • Updated the cash program, goes till March 2017. Most of it goes to share purchases because we see strength of Apple and think that’s best. We understand dividend important, so we are raising it for a third time. Increasing it by 11% effect with next dividend. Will fund with US cash from operations and debt.
  • Guidance: $46-$48 billion, expect GM to 38.5-39.5%

My portfolio consists of 20 shares of Apple, which increases my annual dividends from $37.60 to $41.60, an increase of $4.

9 thoughts on “Apple Inc (AAPL) Dividend Increase

  1. Personally, that seems to be a rather small dividend increase for a company having more than $150 billions in the bank.

    If Apple doesn’t intend to be a significant dividend grower, at least it should do something great with its money. Buying back $80 billions worth of stocks is simply a waste of valuable resource.

    • Likewise, the increase was almost a bit disappointing considering Apple’s position and buybacks do not achieve anything other than short term gains. There are still a lot of companies that do worse, and I dont have a big problem with how Apple is doing things, but all things considered, I wouldve preferred a special dividend instead.


  2. Roadmap,

    Wow.. not too bad is all I have to say. It’s funny, Apple probably could have given a raise of 20-25% but stuck to a modest 10% growth, I say modest due to the lower yield, but still is a very very strong dividend growth mark right there.

    Thanks for gathering a nice summary. Here goes Apple, making that transition to a dividend stock…!


    • Lanny,
      That is a modest increase alright…I was hoping for either a big increase or a special dividend – but I suppose 10.6% aint so bad.
      Its hard to judge the direction of the raises. 2013 = 15% raise, 2014 = 8%, and 2015 = 10.6%.


  3. Not a bad increase and I’ll take it. Though it is indeed a conservative increase I am not sure it will always be this way. I suspect that as time goes on and their profit continues to rise, they will have to continue increasing their dividend. Either way, I’m glad I am a shareholder. Thanks for the update, I appreciate the post.

    – HMB

    • It sure is conservative, by Apple’s standards considering that they maintain such a huge cash position. Hopefully the company will keep delivering over the coming years.


    • Thats a nice little bump when you hold 70 shares….congrats on the raise, DGJ. I wish they spent more on div raises than buybacks, but buybacks are all the rage these days.

      Thanks for sharing

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