If Cash is King, Apple's is an Emperor [Updated]

Apple’s cash for short-term and long-term marketable securities totaled $65.8 billion at the end of the March quarter. Cash increased by $6.1 billion.

The increase in cash is net of approximately $900 million for prepayments and capital expenditures related to the strategic supply agreements that Apple announced last quarter.

The following chart shows the historic cash, short-term and long-term liquid assets Apple holds.

As in previous quarters, the securities Apple holds are:

  • Cash
  • Money market funds
  • U.S. Treasury securities
  • U.S. agency securities
  • Non-U.S. government securities
  • Certificates of deposit and time deposits
  • Commercial paper
  • Corporate securitiesMunicipal securities

Although the asset classes are all liquid, those with longer maturity dates are classified as “long-term”¬†securities (orange area in chart above) and are often not counted as “cash” in many financial databases.

The enormity of the overall size of this cash can be put into several perspectives:

  • The funds are big enough to place Apple’s CFO office in the top 100 largest fund managers in the world and larger than any hedge fund manager.
  • Cash growth in one quarter was higher than the market cap of many companies. For example, if pre-payments were added back, the cash increased by about the market cap of Motorola Mobility.
  • Current cash is worth more than Nokia, RIM and Motorola Mobility’s market caps, put together.
  • Apple’s cash is worth half of Google’s enterprise value.
  • About two years ago, in January 2009 the stock traded at a price of $78 with at least one analyst placing a target of $70 on the stock. Today Apple’s cash is worth $67 70/share.
  • If you owned $100,000 of Apple stock, $19,000 of that would be cash and only about $80,000 would be “at risk” capital.
  • If Apple had no revenues, the current cash would sustain operations (SG&A and R&D) for over 7 years or until the middle of 2018.

When analysts cite limits to the rate of Apple’s growth on the basis of the “law of large numbers” I wonder if there is an implied limit to how big this cash pile can grow. By looking at the chart its size seems to be growing faster all the time.


[Updated] The cash per share figure was wrong. It is $70/share.