What's Up With Apple: More Stock Buybacks, Fix Your Own iPhone and More

We have commented before on Apple Inc.’s (NASDAQ: AAPL) intent to boost its earnings per share by reaching a net cash neutral position over a period of several years. CEO Tim Cook announced the goal in March of 2018. Becoming cash neutral means that Apple’s cash will be equal to its total debt.

In a research note Wednesday, Bernstein analyst Toni Sacconaghi said Apple could extend its share buybacks of 3% to 4% of outstanding stock for the next five years and still raise its dividend by 10% in each of those years — all without taking on new debt. This program would reduce Apple’s outstanding share count by 15%. Barron’s cited Sacconaghi’s research:

Apple’s ongoing buyback program provides a relatively clear path to high single digit EPS growth or better for the next five years, assuming its hardware revenues do not decline and its service segment grows at historical mid-teens.

Sacconaghi also noted that Apple could maintain this pace through 2035 if the company were willing to raise its debt level to twice the company’s EBITDA. This plan would cut Apple’s share count by 35%.

Apple announced Wednesday that it is creating a Self Service Repair program that allows owners of certain Apple products to make repairs to their own devices using authentic Apple parts. Apple expects to launch the program early next year in the United States and to extend the program to other countries throughout the year. Earlier this year, Apple extended its authorized repair services to 200 countries.

Jeff Williams, Apple’s chief operating officer, said:

Creating greater access to Apple genuine parts gives our customers even more choice if a repair is needed. In the past three years, Apple has nearly doubled the number of service locations with access to Apple genuine parts, tools, and training, and now we’re providing an option for those who wish to complete their own repairs.

The Self Service Repair program will be “available first” to owners of iPhone 12 and iPhone 13 devices, with owners of M1-powered Macs soon to follow. Initially, the program will focus on iPhone modules that are most commonly serviced: display, battery and camera.

Apple’s announcement is also clear about who the program is aimed at:

Self Service Repair is intended for individual technicians with the knowledge and experience to repair electronic devices. For the vast majority of customers, visiting a professional repair provider with certified technicians who use genuine Apple parts is the safest and most reliable way to get a repair.

In other words, the techies who have been yelling about this for years. It’s a bit hard to believe that non-technical iPhone 13 Max owners are going to want to tear apart their $1,100 phones at the kitchen table.

Apple is not the only company that has limited access to repair services. A tractor bears a strong resemblance to an iPhone in this regard.

Briefly noted:

Apple has released a minor update, iOS 15.1.1, that improves call drop performance on iPhone 12 and 13.

Cher Scarlett, an Apple engineer who was recognized as a leader in efforts to get the company to be more transparent about pay and other workplace issues, has reached a settlement with the company. According to Bloomberg, Scarlett is withdrawing her complaint to the National Labor Relations Board and is leaving Apple voluntarily.

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