With $70 billion in the till after the end of this quarter, Apple could buy many of its competitors
At the end of this quarter, Apple will have enough cash to pay the enterprise value of the manufacturers of 75% of cell phones in the industry
While the Federal Trade Commission would never agree to approve such a transaction, if Apple were to pay the enterprise value for RIM ($13.8 billion), Nokia ($22.6 billion), HTC ($25.4 billion) and Motorola Mobility ($4.2 billion), it would cost them $66 billion-less than the amount of cash Apple will shortly have on hand. In real life, of course, one would have to offer a premium price to the shareholders in order to buy them out. That is where Apple's high priced stock would come in handy. A combination of stock and cash would be more than enough to get a deal done. But alas, it is just a pipe dream because of anti-trust laws.
Still, Apple would probably be able to get approval to purchase one of its rivals excluding Microsoft. Would you like to see them go for an Android manufacturer like HTC or Motorola, or aim for RIM? Apple has been able to amass this cash hoard because of the incredible profitability of the iPhone. With just 4% of the worldwide handset market, Apple brings in more than half of the industry's profits. Could you imagine the pile of cash Apple would have available to tap if it increased its market share just a little?
source: Asymco via AppleInsider
1. Eingild (Posts: 203; Member since: 19 Apr 2011)
This damn site. Always talking about how rich and how great Apple is. Don't get me wrong. I love Apple as much as the man behind it. But dude, seriously? I'm tired of all these biased craps that PA is putting on Apple. Always considering Apple as the greatest of all time. >.
4. clevername (Posts: 1428; Member since: 11 Jul 2008)
Phonearena didn't write this article. This news has been circulating around several websites today, and all over twitter. That kinda makes it news. And since its news about the cell phone industry, PA reports it. No bias there. And about being the greatest, they just point out how rich they are. Again, not biased just facts. Can't speak for other articles but this one is pretty simple.
8. Eingild (Posts: 203; Member since: 19 Apr 2011)
Thanks for clarifying that out dude. I mistook the essence of the article.
15. The_Miz (Posts: 1496; Member since: 06 Apr 2011)
Get over yourself. Apple is rich, their iPhones sell like hotcakes.
20. doubler86 (Posts: 318; Member since: 26 Jan 2011)
Ya they sell like hotcakes, they sell almost 1/3 of the amount of Android phones.
40. Lucas777 (Posts: 2121; Member since: 06 Jan 2011)
ahh but how much does a single one of said devices sell?
43. showtime_tech (Posts: 2; Member since: 11 Jun 2011)
In only two carriers with one phone, did u forget to calculate that part of the math.With all due respect your argument is rubbish its like your making iphone look good by the fact they can outsell 1/3 of android phones with one that is not as advanced spec wise as some android phones. My question is are u the ifanboy i suspect u are?
25. Hunz (unregistered)
Well this isn't the matter of this Site! Now a dayz there is alot of thing or Business how Apple do! Of course Apple have lots of Good news & also Furthur you'll see how many news out there after release Iphone 5! With all due Respect, Apple make an incredible Job on its own way! Enjoy!:)
2. SuperAndroidEvo (Posts: 3880; Member since: 15 Apr 2011)
Hey Apple with 70 Billion dollars, will you lend me $10,000.00? To you Apple that is like 2 cents. It will help me with buying that Ducati StreetFighter that I want. I am just only short $10,000.00. If I can have it now & not wait until September it would be a huge blessing. I might even buy an Apple iPhone 4S/5 when it comes out. What do ya say Apple? Pleeeeeeeeeeease!?!?!?!?!?!?! lol
3. bossmt_2 (Posts: 430; Member since: 13 Oct 2009)
As long as apple consumers agree to pay premiums for software and hardware, they'll keep these insane profits.
Apple is truly an amazing company, people will really pay any price for anything they tell them is a must have.
5. TOdoubleD (Posts: 113; Member since: 28 Mar 2011)
This isn't news, its some dumbazz sitting around thinking, "wow this company has so much money they could buy this company". Yeah that took some serious brain power to come up with that one. I highly doubt that Mr Jobs has any interest in any of it.
6. coria791 (Posts: 21; Member since: 12 Jun 2010)
Please Phonearena we know Apple is the big COMPANY OUT THERE I LOVE THIS WEBSITE A LOT BUT PLEASE DONT GIVE APPLE ANY IDEAS THEY HAVE ALL THE MONEY THEY CAN ASK FOR
7. ztedac (Posts: 69; Member since: 17 May 2010)
yes... apple first sues them then buys them >.>
10. biophone (Posts: 1893; Member since: 15 Jun 2011)
Apple has nice products not the best spec wise but it's nice to used and are very high quality. People like high quality products so yeah it's Bo surprise how successful they are. I just wish they could compete better in other areas but there fanbase doesn't care. To them it's all about the experience which it should be but specs are apart of that to me.
11. Sniggly (Posts: 6819; Member since: 05 Dec 2009)
If Apple were to offer to buy Motorola, I hope Motorola would stare them square in the eyes and say "Fu.ck you."
13. 530gemini (Posts: 2198; Member since: 09 Sep 2010)
That would be you sniggly, not Motorola :)
17. remixfa (Posts: 13902; Member since: 19 Dec 2008)
this article is retarded. What would Apple stand to gain from buying motorola or the other companies? They would only be interested in samsung or LG for their screen and chip technologies.
And would anyone exept the most die hard brain dead apple fan boy even want that? HELL NO.
This article was written by an apple fanboy for apple fanboys over at appleinsider.com It should not be reported as news by any legitimate site.
Honestly, this site goes out of its way to earn the whole iphonearena gaffes by repeating garbage like this.
And yes, I would be just as offended if they said MS or Google... both of which that have massive warchests... should buy up the entire industry. The industry's state of innovation is due to its heavy competition, not because of any one company.
52. matt (unregistered)
Nokia is also a company worth buying simply because of the enormous patent portfolio they have. Samsung are too big for Apple to buy out.
Only realistic company that are possibly going to be bought are RIM or Nokia. They are losing market share and value and need to step up their game. RIM is a proven work horse in business so its worth it for other companies to but out to integrate their services with their own. For eg Samsung with its galaxy s line could make it work as a business phone with all the functionality of android which would also help them beat apple.
26. Sniggly (Posts: 6819; Member since: 05 Dec 2009)
Damn straight, Gemini. If you put me in charge of Motorola it'd become bigger than Apple.
29. 530gemini (Posts: 2198; Member since: 09 Sep 2010)
Lol sniggly. If you're that good, you won't need Motorola to put you in charge. You'll have your own company ;)
38. Sniggly (Posts: 6819; Member since: 05 Dec 2009)
Well, maybe I will have my own company. And maybe I'll fu.cking buy Motorola myself. How do you like DEM apples?! :P
12. JB (unregistered)
And yet they still don't pay a dividend.
42. Lucas777 (Posts: 2121; Member since: 06 Jan 2011)
precisely why i wud never (now) buy apple stock... shuda bought it 5 years ago though... haha
14. som (Posts: 768; Member since: 10 Nov 2009)
Apple has $70 billion cash in hand, how much is Samsung have cash in hand?
18. remixfa (Posts: 13902; Member since: 19 Dec 2008)
Microsoft has more cash on hand. Apple may seem like a big company but they are roughly 1/4th the size of MS. They just spit out how many billion for Skype.. paid how many billion to Nokia.. and they didnt even blink an eye.
30. 530gemini (Posts: 2198; Member since: 09 Sep 2010)
Samsung has $21.11B cash and $10.62B total debt
Microsoft has $26.66B cash and $13.16B total debt
Apple has $26.48B cash with ZERO 0 debt (estimated to have $70B cash flow by end of 2nd quarter reports)
So how can Apple only be 1/4 of MS when they have more $$$ than MS? Lol.
41. Lucas777 (Posts: 2121; Member since: 06 Jan 2011)
haha remixfa doesnt know what he is talking about... its not like microsoft just buys whatever without a blink... obviously nokia is still around... if they were as rich as apple they wudnt even need to think about it..
44. remixfa (Posts: 13902; Member since: 19 Dec 2008)
Apple makes like 5 products and has a very streamlined company. MS has multiple devisions that are as big or bigger than Apple. MS's cashflow is much larger than apple's. Cash flow and reserves are not the same thing. Apple makes a higher profit margin than MS because of this, though MS brings home billions more over all than Apple. You think Apple's like 10% of the computer market and like 20% of the smartphone market bring home more than Microsoft's dominance in computers, software, gaming, and a dozen other things??
You dont seem to understand business. But hey, thats ok, most dont which is why people keep voting these idiots in power that keep f**king things up.
48. 530gemini (Posts: 2198; Member since: 09 Sep 2010)
Huh? I already gave you the figures and you're still not getting it. Tell us then how much cash reserves MS has, lol. The more products you produce, the more money you shell out in producing them as well, and there's no guarantee that all of them would be bestsellers. Fortunately for Apple, majority of their products are bestsellers. That is why they are making tons and tons of profits. It's only in the corporate industry that MS still excels, but think about this, the iphone and the ipad is growing rapidly in that area as well. And think about this. A desktop pc is more expensive to produce than an ipad and an iphone, but the iphone and the ipad are more expensive than some pc's, so there's bigger profit on the ipad and the iphone, lol.
I do understand business, but you don't seem to understand the actual figures, lol.
16. Cloudy (unregistered)
Why dont they state in this article that Samsung can buy 75% of smartphone competitors along with Apple.
THE CASH BALANCE THEY HOVE IS CLOSE TO 140Billion dollars
19. som (Posts: 768; Member since: 10 Nov 2009)
APPLE (rank #75)
Sales - $46.71 billions
Profits - $9.36
Assets - $54.00
Market Value - $189.51
SAMSUNG ELECTRONICS (rank #55)
Sales - $97.28
Profits - $4.43
Assets - $83.30
Market Value - $94.48
Today Apple have $70 billions cash in hand and I cannot find SAMSUNG cash in hand. Is Assets is cash in hand?
22. snowgator (Posts: 3200; Member since: 19 Jan 2011)
I do not think so. Investment is something I have just started to learn about so feel free to correct me, but if I understand right, cash in hand is exactly like it sounds- money set aside for a companies use that is not already invested. This large of an amount will usually be secured in some way, but the corporation can have availability to it with only a small transaction fee. Assets are some sort of investment which can be liquidated to allow a cash flow as needed, though not without a penalty or larger fee.
I cannot even imagine why a Company would want that much cash in hand. The value of the dollar changes so much, most of the reading I have come across (again, not a lot) states it is better to have the assets and pay the fees as needed. Your profit is protected better. Multibillion dollar companies like Apple and Microsoft seem to be doing okay, though. So who am I to correct them ......
31. 530gemini (Posts: 2198; Member since: 09 Sep 2010)
Fortune 2010? Hahahahaha. Use Fortune 2006. That would even put Apple off the list, hahahahahaha.
21. sponmagnet (unregistered)
there is a miss understanding in this piece of information, Nokia sells more phones than apple, and they,logically, have much more cash accumulated in the banks in the past years. i don't think apple has $70 billion may be it is 7.0 billion and the source miss writen it.
33. 530gemini (Posts: 2198; Member since: 09 Sep 2010)
$7B? HAHAHAHAHAHAHAHAHAHAHAHAHAHA. Nokia more money than Apple? HAHAHAHAHAHAHAHAHAHAHA.
Thanks for making me laugh so hard. You made my weekend :)
34. 530gemini (Posts: 2198; Member since: 09 Sep 2010)
BTW, Nokia has $5.18B cash flow and $6.66B total debt. Hahahahahaha
Their total debt is higher than their cash, hahahahahahaha. But yes, Nokia has way more cash than Apple.....in your world, hahahahahahahahaha.
23. Fatcownot (unregistered)
Just to proof what a fat cash cow all those iPhone owner out there are :P
BTW, they forgot to mention Sony Ericsson, LG, Sharp and all those crazy China manufacturers :P
24. nb1148 (unregistered)
Ya, they could probably buy most of their competitors... but then who would they copy iOS 6 from?
27. atree (Posts: 24; Member since: 20 May 2011)
Finance/Accounting major here....
liquid assets do not equal cash.
Liquid assets are "easily converted to cash" but that's assuming people by their product, so you would need the inventory turn over ratio and have to know exactly how much of that 50 billion is all devices, however that might not all be devices , it could be bonds and stocks which is more likely. In that case they would faces probably close to 10-15 percent in fees converting 50billion to cash and end up with around 30-40 billion. Also Apple buying out its competition would have to pass in many courts and such.
Long story short, its like comparing apples and oranges...
32. 530gemini (Posts: 2198; Member since: 09 Sep 2010)
They are not referring to liquid assets. They are referring to actual cash flow of Apple that they can actually spend for their operating expenses. Also, Apple has ZERO debt, while all the others have BILLIONS in debts.
35. snowgator (Posts: 3200; Member since: 19 Jan 2011)
For all the critics of Apple out there, Gemini, I have yet to here anyone claim the ain't great business men and women (to be modern age correct, of course.) I have heard ruthless and defensive, but never not great. They are near genius with their cash and investments. No hostile takeover in their future.
36. 530gemini (Posts: 2198; Member since: 09 Sep 2010)
Which apparently mean that they are doing something right. So no matter what iHaters out there say about how evil Apple is, their contribution and the good that they have done to the tech industry obviously outweighs it.
39. Sniggly (Posts: 6819; Member since: 05 Dec 2009)
No...their practices are anti competitive and only occasionally do they truly innovate. They're very good at destroying anyone who stands in their way, but their lack of ethics makes them distasteful, no matter how much money they have.
49. 530gemini (Posts: 2198; Member since: 09 Sep 2010)
What sniggly? Apple is trying to keep the balance and you're saying that they're good at destroying anyone who stands in their way? Lack of ethics? Apple discourages porno and piracy, and has created an ecosystem that developers and artists and writers get paid, and you say that they lack ethics? So what do you call those manufacturers who do not give a hoot about piracy and just allows transferring of media files from one user to another? Highly ethical companies? Oh please. You need to evaluate your morals sniggly.
53. Sniggly (Posts: 6819; Member since: 05 Dec 2009)
Did you just insinuate that porn is immoral? Sounds like you're the one who needs to reevaluate your morals.
45. remixfa (Posts: 13902; Member since: 19 Dec 2008)
no, they are referring to cash on hand.. not cash flow. you keep confusing terms.
50. 530gemini (Posts: 2198; Member since: 09 Sep 2010)
Hahahaha, cash flow is basically cash on hand silly, hahahahaha.
28. henk-jan (unregistered)
I like the difference between cell phone company's, 1 company will be boring isn't it?
37. ajac09 (Posts: 1365; Member since: 30 Sep 2009)
always pushing apple. I bet if it was about something other then apple you woudlnt even post it.
46. InspectorGadget80 (Posts: 6263; Member since: 26 Mar 2011)
Who gives a DAMN bout APPLE. The only thing iny opinion is APPLE lovers loveers n their fanboys. The only thing thar sells most is their ipods/iphone. They may be the #1 manufacturer but they can never he good as Android phones. Most of their money comes from ipods.
47. iHateCrapple (Posts: 734; Member since: 12 Feb 2010)
crApples iPhone makes them so much money because they dont pay d!ck in commissions!
51. applesauce (unregistered)
Does anyone else remember a bit more than a decade ago when apple was on the verge of extinction and Microsoft and some other companies had to buy most of apple to prevent a Microsoft/Windows monopoly. and now some of those same companies are now in a similar position apple was then? I wonder if any of the then-leadership are wondering "WTF?" nowadays.
54. TyDeL (unregistered)
"A combination of stock and cash would be more than enough to get a deal done. But alas, it is just a pipe dream because of anti-trust laws."
I know this article is from Apple Insider, but even so I'm kind of shocked that even an Apple fan-site would be so obtuse that they refer to the hostile take-over of every competing cell-phone company by Apple to be a "dream."