Apple prepares for first debt issue
"We may, from time to time, offer to sell debt securities in one or more offerings," the California tech giant said in a document filed with the Securities and Exchange Commission.
Apple executives described their plans last week when the firm reported quarterly results, indicating the company would spend $100 billion on buybacks and dividends to boost shareholder value.
The maker of the iPhone and iPad has a cash stockpile of at least $145-billion, based on disclosures from its latest earnings.
But much of that is outside the United States, and repatriating that money would lead to a big tax bite under current US law.
Last week, Standard & Poor's said it would rate Apple bonds AA+ and Moody's indicated it would rate them Aa1. The rating agencies said they would not give the top grade of AAA because of the fast-changing nature of the sector.
Apple posted a profit of $9.5-billion on revenue of $43.6-billion in the first three months of this year, compared to $11.6-billion on $39.2-billion a year earlier.
Quarterly sales numbers grew – with the number of iPhones rising to 37.4-million from 35.1-million a year earlier, and iPads surging to 19.5-million from 11.8-million.
But margins were clearly shrinking: the gross margin fell to 37.5% from 47.5%. Apple shares rose 3.1% on Monday to end at $430.12, far below last year's peak above $700.
Some analysts say the company is facing a crisis in a market where competitors are closing in.
"This is a crisis," Indigo Equity Research said in a recent note.
"Apple is making similar errors that Nokia and Motorola did; by not releasing sufficiently innovative product upgrades frequently enough. A problem is that once consumer tech companies lose their edge, they rarely regain it." – AFP