4 ms·

Also to be read as, "Apple to invest 0.38% of 2011's total profit to bring Mac production to the US next year"

tribeofone 14y ago
OR, you could read it as "Apple to invest 0.1% of its total cash in reserve to bring Mac production to the US next year"
- deleted 14y ago
  [deleted]
- DannyBee 14y ago
  As a slight sidetrack, Apple doesn't have that much cash in reserve. They have short term investments and long term investments. Articles you read that claim they have 100 billion (or whatever) in cash are seriously confused about how cash and cash equivalents work. From their latest 10k: Cash and cash equivalents $ 10,746 Short-term marketable securities $ 18,383 Long-term marketable securities $ 92,122 (this is in millions) Long term marketable securities are basically those things that they would likely take a significant hit on if they had to actually convert to cash in a reasonable period of time. So how does this really compare to other companies? Let's look at google. As of September 30, 2012, Google had: Cash and cash equivalents: $ 16,260 Short term marketable securities:$ 29,464 Whoops. It turns out google has more actual cash than apple, and more combined short term securities + cash. Just not as much in long term investment securities. In short: Apple doesn't really have some amazing amount of cash.
  - tribeofone 14y ago
    Thanks for the breakdown, does that $92,122 represent their investments in infrastructure and manufacturing (that google does not really need to make) or money invested in long term securities/financial products? Whats the Long-Term marketable securities for Google?
    - tatsuke95 14y ago
      It's financial instruments. Apple's cash hoard is essentially a massive bond fund they run out of Nevada.
  - jtbigwoo 14y ago
    Twenty nine billion dollars is still an amazing amount of cash. That's almost $400k for every employee!
  - tatsuke95 14y ago
    >Articles you read that claim they have 100 billion (or whatever) in cash are seriously confused about how cash and cash equivalents work. It's semantics. It's cash. Not in the literal sense that they are wallpapering the headquarters with it. But it's cash from profits they've earned, that are invested in bonds and securities, just like you are I would. >Long term marketable securities are basically those things that they would likely take a significant hit on if they had to actually convert to cash in a reasonable period of time. Not necessarily true. Apple holds something like $15BB in Treasuries under their LTMS holdings. These are liquid (hence the label marketable). They also own a bunch on municipal bonds and corporate debt, most of which are also extremely liquid.
    - DannyBee 14y ago
      It's not semantics to call it "not cash". If i own a million shares of apple stock, I don't own cash or a cash equivalent, i own a marketable security. They are valued quite differently. The long term/short term is the maturity, and as you point out, some billions are probably treasuries, which are easy to trade (They don't break it down that I saw, Google does break it down into treasury bonds, etc). However, some of it could be (and certainly is) instruments that they could transform into cash (hence marketable), but would take a significant loss on if they needed to do so quickly (< 90 days). Calling that cash is simply false. Let's stick with the simple fact: If they needed to transform that 92 billion in long term marketable securities into cash tomorrow, the percent chance they will get 92 billion for it is quite low. If they need to transform it into 92 billion in cash in the next 6 months, the percent chance they will get 92 billion for it is quite high.
      - tatsuke95 14y ago
        >"It's not semantics to call it "not cash"" Yes, it is. I take offense to stating that people who use the term "cash" don't know what they're talking about. They, in fact, do know that "cash" doesn't imply Apple has a Scrooge-McDuck-type vault loaded with hundred dollar bills. >"If i own a million shares of apple stock, I don't own cash or a cash equivalent" Commercial paper, short-term debt, preferred stock, T-bills, option contracts are all cash equivalents. This is where Apple is putting its money (they aren't buying tens of billions worth of common stock). It's "cash".
  - melvinmt 14y ago
    Hint: Marketable assets means liquid assets. If they need to spend the LTMS they can do it in a matter of days, hence the term "cash".
    - DannyBee 14y ago
      Uh, no. If it was "cash", or equivalent, it would be under "cash and cash equivalents". Marketable simply means they can be traded (IE they are not something like non-OTC stocks) They may be long term instruments that they would take a loss on if they traded before maturity. Heck, they may be long term instruments that have trading restrictions on, etc. It's simply not cash. Period.
      - melvinmt 14y ago
        If long term assets have trading restrictions they're not marketable. I get that it isn't cash cash in the most literate sense, it's liquid assets, which is nearly equivalent to cash, just like the "cash" in your bank account.
  - atmz 14y ago
    Stop arguing with everyone, long-term marketable securities doesn't mean what you think it means. You're right in that it's not cash, and in some cases it's illiquid. However, you seem to think the 'long-term' in 'long-term marketable securities' means 'will take a long time to sell for fair value'. This is wrong; long-term just refers to the maturity of the instruments. Again, these long-term instruments are more likely to be illiquid, but they're not illiquid by definition. 10-year Treasury notes are 'long-term' but highly liquid. So, in conclusion, it depends on what these "long-term marketable securities" are, which is what most of the other replies are trying to say. If you want to argue, argue that Apple owns a bunch of RIMM stock or something, don't accuse others of misunderstanding the term.
- numeral_two 14y ago
  LOL that was my first thought, interested by all the other discussion about how they move money, financial engineering is such a bizarre subject.

OR, you could read it as "Apple to invest 0.1% of its total cash in reserve to bring Mac production to the US next year"

deleted 14y ago
[deleted]
DannyBee 14y ago
As a slight sidetrack, Apple doesn't have that much cash in reserve. They have short term investments and long term investments. Articles you read that claim they have 100 billion (or whatever) in cash are seriously confused about how cash and cash equivalents work. From their latest 10k: Cash and cash equivalents $ 10,746 Short-term marketable securities $ 18,383 Long-term marketable securities $ 92,122 (this is in millions) Long term marketable securities are basically those things that they would likely take a significant hit on if they had to actually convert to cash in a reasonable period of time. So how does this really compare to other companies? Let's look at google. As of September 30, 2012, Google had: Cash and cash equivalents: $ 16,260 Short term marketable securities:$ 29,464 Whoops. It turns out google has more actual cash than apple, and more combined short term securities + cash. Just not as much in long term investment securities. In short: Apple doesn't really have some amazing amount of cash.
- tribeofone 14y ago
  Thanks for the breakdown, does that $92,122 represent their investments in infrastructure and manufacturing (that google does not really need to make) or money invested in long term securities/financial products? Whats the Long-Term marketable securities for Google?
  - tatsuke95 14y ago
    It's financial instruments. Apple's cash hoard is essentially a massive bond fund they run out of Nevada.
- jtbigwoo 14y ago
  Twenty nine billion dollars is still an amazing amount of cash. That's almost $400k for every employee!
- tatsuke95 14y ago
  >Articles you read that claim they have 100 billion (or whatever) in cash are seriously confused about how cash and cash equivalents work. It's semantics. It's cash. Not in the literal sense that they are wallpapering the headquarters with it. But it's cash from profits they've earned, that are invested in bonds and securities, just like you are I would. >Long term marketable securities are basically those things that they would likely take a significant hit on if they had to actually convert to cash in a reasonable period of time. Not necessarily true. Apple holds something like $15BB in Treasuries under their LTMS holdings. These are liquid (hence the label marketable). They also own a bunch on municipal bonds and corporate debt, most of which are also extremely liquid.
  - DannyBee 14y ago
    It's not semantics to call it "not cash". If i own a million shares of apple stock, I don't own cash or a cash equivalent, i own a marketable security. They are valued quite differently. The long term/short term is the maturity, and as you point out, some billions are probably treasuries, which are easy to trade (They don't break it down that I saw, Google does break it down into treasury bonds, etc). However, some of it could be (and certainly is) instruments that they could transform into cash (hence marketable), but would take a significant loss on if they needed to do so quickly (< 90 days). Calling that cash is simply false. Let's stick with the simple fact: If they needed to transform that 92 billion in long term marketable securities into cash tomorrow, the percent chance they will get 92 billion for it is quite low. If they need to transform it into 92 billion in cash in the next 6 months, the percent chance they will get 92 billion for it is quite high.
    - tatsuke95 14y ago
      >"It's not semantics to call it "not cash"" Yes, it is. I take offense to stating that people who use the term "cash" don't know what they're talking about. They, in fact, do know that "cash" doesn't imply Apple has a Scrooge-McDuck-type vault loaded with hundred dollar bills. >"If i own a million shares of apple stock, I don't own cash or a cash equivalent" Commercial paper, short-term debt, preferred stock, T-bills, option contracts are all cash equivalents. This is where Apple is putting its money (they aren't buying tens of billions worth of common stock). It's "cash".
- melvinmt 14y ago
  Hint: Marketable assets means liquid assets. If they need to spend the LTMS they can do it in a matter of days, hence the term "cash".
  - DannyBee 14y ago
    Uh, no. If it was "cash", or equivalent, it would be under "cash and cash equivalents". Marketable simply means they can be traded (IE they are not something like non-OTC stocks) They may be long term instruments that they would take a loss on if they traded before maturity. Heck, they may be long term instruments that have trading restrictions on, etc. It's simply not cash. Period.
    - melvinmt 14y ago
      If long term assets have trading restrictions they're not marketable. I get that it isn't cash cash in the most literate sense, it's liquid assets, which is nearly equivalent to cash, just like the "cash" in your bank account.
- atmz 14y ago
  Stop arguing with everyone, long-term marketable securities doesn't mean what you think it means. You're right in that it's not cash, and in some cases it's illiquid. However, you seem to think the 'long-term' in 'long-term marketable securities' means 'will take a long time to sell for fair value'. This is wrong; long-term just refers to the maturity of the instruments. Again, these long-term instruments are more likely to be illiquid, but they're not illiquid by definition. 10-year Treasury notes are 'long-term' but highly liquid. So, in conclusion, it depends on what these "long-term marketable securities" are, which is what most of the other replies are trying to say. If you want to argue, argue that Apple owns a bunch of RIMM stock or something, don't accuse others of misunderstanding the term.
numeral_two 14y ago
LOL that was my first thought, interested by all the other discussion about how they move money, financial engineering is such a bizarre subject.