What Will Apple Do with Its Cash Mountain?

As of June 27, Apple had cash and investments totaling $31.1 billion, up 27 percent from the previous year.

Brian Marshall, an analyst at Broadpoint AmTech, contends that Apple’s cash position is the strongest among all technology companies. Whereas Cisco and Microsoft — at $35 billion and $31.4 billion, respectively — each possesses more cash, both companies have debt that takes them below the net cash position of debt-free Apple, according to Marshall.

So, what will Apple do with its mountain of cash?

If past performance is any guide to future behavior, Apple won’t do anything drastic. What it has been doing — with the iPhone, the iPod family, and its Mac computers — obviously is working quite well, driving revenue growth that remains the envy of the industry.

Unlike Cisco and Microsoft, Apple doesn’t find itself in the urgent position of having to go outside its wheelhouse to find rivers of new revenue.

Moreover, Apple is not known for ostentatious acquisitions. The largest acquisition it ever made was its $400-million purchase of NeXT, whose OpenSTEP provided a foundation for OS X and with which current Apple CEO had more than a fleeting attachment.

So Apple likely will use its cash reserves tactfully and tactically, not making many waves in the process.

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