Apple (NASDAQ:AAPL) CEO Tim Cook revealed in a recent interview that the company repurchased $14 billion of its own shares over the past two weeks, reports the Wall Street Journal. The stock buyback was made after Apple’s fiscal first-quarter financial results precipitated a decline in the company’s share price. Apple stock is currently trading at $512.51, almost 7 percent lower than its price before its earnings announcement.
According to the Wall Street Journal, Cook was “surprised” by the 8 percent fall in the company’s share price on the day following its earnings announcement on January 28. However, the Apple CEO decided to take full advantage of the price decline by being “aggressive” and “opportunistic.”
Last April, Apple announced a significant expansion to its capital return plan, including $60 billion for share repurchases that will extend through 2015. Per the Wall Street Journal, Cook noted that the latest share repurchases were still part of this previously revealed stock buyback plan. However, Cook also said that “updates” to Apple’s share repurchase program will be revealed in March or April of this year.
According to the Wall Street Journal, Cook said that $12 billion of the most recently purchased shares were bought through an “accelerated” buyback program, while the remaining $2 billion were bought on the “open market.” Including the most recent share repurchases, Apple has now bought over $40 billion of its own stock within the past twelve months. As noted by CFO Peter Oppenheimer in the company’s fiscal first-quarter earnings call, Apple bought $5 billion of its own shares last quarter.
“It means that we are betting on Apple. It means that we are really confident on what we are doing and what we plan to do,” said Cook via the Wall Street Journal. “We’re not just saying that. We’re showing that with our actions.”
Apple’s opportunistic share repurchases will likely please activist investor Carl Icahn. Icahn has been pressuring the company to return more cash to shareholders by expanding its share repurchase program by another $50 billion. However, Apple has recommended that the company’s shareholders vote against Icahn’s proposal. According to the Wall Street Journal, Icahn responded to Cook’s statement about his confidence about the company’s plans by stating, “So am I.”
After Apple’s stock price slipped following the company’s disappointing earnings results, Icahn revealed via Twitter (NYSE:TWTR) that he had purchased another $500 million Apple shares. “My buying seems to be going neck-and-neck with Apple’s buyback program, but hope they win that race,” tweeted Icahn.
Follow Nathanael on Twitter (@ArnoldEtan_WSCS)