Good News from Apple

Kelley Robertson
January 18, 2018

According to the release, Apple's current workforce across the 50 U.S. states is 84,000.

Seemingly as a way of saying thank you to Republicans and the Trump administration, Apple spelled out all the good things it already does for the USA economy and what it plans to do now.

It anticipates a $38 billion tax bill for repatriated cash, as a result of the new tax bill. Companies can pay over eight years.

This was helped along by the controversial tax overhaul President Donald Trump signed into law last month, which also lowered corporate taxes from 35 percent to 21 percent. Before 2016's election, Trump criticized the California giant's practices. Though $350 billion is undoubtedly a large number, it hardly makes a dent in Apple's cash hoard and its more than $50 billion of annual free cash flow, since it's a commitment that spans five years. I encourage you to read about these announcements on AppleWeb.

The iPhone maker also told employees that it's issuing stock-based bonuses worth US$2,500 each following the new United States tax law, according to people familiar with the matter. Walmart, for instance, said it was giving bonuses up to $1,000, but the highest bonuses only went to employees who worked with the company for 20 years or more. One significant piece of news shared as part of that broader story was the surprise announcement of a new Apple campus in the works. It's not clear how large the campus will be nor whether Apple intends to make this a flagship campus, or just another of its many office locations around the globe. In its last earnings report, the company reported it held US$252 billion in cash overseas.

"They're going to have well over $200bn by the end of this year that will be available for incremental investments, capital returns and M&A", said Matthew Kanterman, a New York-based Bloomberg Intelligence analyst.

The bill gave incentives to US companies to bring offshore holdings back home, required them to to pay a one-time tax of 15.5% on overseas profits held in cash and other liquid assets. "And Apple hasn't historically done big M&A", he said. Under the new law, that rate is cut to 15.5 percent, saving Apple tens of billions of dollars compared to what it would have paid to bring the cash home in 2017. Apple said it is breaking ground on a new facility in downtown Reno, Nev., which will support its existing Nevada facilities. Apple announced on Wednesday that they will grow their investment in domestic manufacturing to $5 billion.

"The company plans to establish an Apple campus in a new location, which will initially house technical support for customers".

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