Following the events noted in this case, state what Apple actually chose to do with their cash (2013 - 2014) and any rationale for this decision.

Dividends and Share Repurchases Apple declared a quarterly dividend of $2.65 per share in March 2012, coupled with a $10 billion three-year share repurchase program. According to PO, Apple's share repurchase pro- gram and dividends would cost the company $45 billion in domestic cash over the next three years. This was Apple's first dividend authorisation since 1995. Despite its efforts to bol- ster shareholder trust, Apple's stock price has continued to decline from its September 2012 peak, particularly when compared to the NASDAQ index. Despite this initiative, numerous prominent and vocal stockholders remained dissatisfied. Simultaneously, TC was also aware of Apple's progenitors' fluctuating fortunes, particularly Palm and Blackberry. Preferred Share - iPref In February 2013, DE sent an open letter to Apple shareholders urging the company to finally "unlock shareholder value" and halt the growth of Apple's cash hoard. DE proposed a perpet- ual preferred stock, which he named "iPref." Apple would issue five preferred shares for every common share to all present owners. Each of these preferred shares would have a face value of $50 and would pay a quarterly dividend of 50 cents. DE was well aware of Apple's corpo- rate tax situation and ensured that the dividends would be paid by free cash flow. Apple may issue five iPrefs for each common share without depleting its cash reserves. DE anticipated that this five-iPref distribution would unlock $150 in value for each share, or nearly 33% of the Q1 2013 stock price of $450.50. DE asserted that this was greater than the value unlocked by a share repurchase program or a special dividend. The iPref would also resolve the repatriation issue by utilising exclusively free cash flows. With roughly 939.1 million shares outstanding in Q1 2013, the program's first year costs would be around $9.4 billion. Many thought that DE's proposal was a viable solution to Apple's dilemma. Conclusion Apple was the non-financial institution with the greatest cash reserves. Apple's closest com- petitor in terms of cash reserves was Microsoft, which held little more than half of Apple's. TC and PO needed to develop a solution that satisfied shareholders while still allowing the company to innovate. TC and PO had to first decide whether or not to return money to share- holders and, if so, how much. TC and PO began by generating a financial estimate to see how much cash Apple would accumulate over the next five years if they returned all of it in 2012. They were sceptical of DE's calculations for dividends, repurchases, and iPref and chose to perform their own computations. TC and PO were reminded that even with such a vast sum of money and the pressure it generated, high-class problems remained problems. - End of Case Study