According to Dolphin Research APP, Alphabet-C, the parent company of Alphabet-C-C-C-C-C-C-C-C-C-C-C (GOOGL.US), is facing a new issue: how to spend its growing cash reserves.
After layoffs in the second quarter and efforts to curb losses in various projects, Alphabet-C-C-C-C-C-C-C-C-C-C-C generated nearly $29 billion in cash. This brings Alphabet-C-C-C-C-C-C-C-C-C-C-C's cash and short-term securities to approximately $118 billion, surpassing any other company in the Nasdaq 100 index except for Apple (AAPL.US), which has a cash balance of about $167 billion.
However, unlike Apple, which plans to return most of its cash to shareholders through stock buybacks and dividends, Alphabet-C-C-C-C-C-C-C-C-C-C-C's capital return strategy is less clear, leaving investors hoping for more details about its plans.
Aniel Morgan, Senior Portfolio Manager at Synovus Trust Co., pointed out that we have never really faced this issue with Alphabet-C-C-C-C-C-C-C-C-C-C-C before because they have never generated cash flow as frequently as they do now. Typically, investors do not like companies hoarding large amounts of cash; they want these funds to be invested for better returns or returned to shareholders.
The three companies with the highest cash generation in the Nasdaq 100 are Alphabet-C-C-C-C-C-C-C-C-C-C-C, Apple, and Microsoft (MSFT.US), which collectively generated $84 billion in cash last quarter, the largest ever outside of holiday periods.
Alphabet-C-C-C-C-C-C-C-C-C-C-C has increased its buyback program and expanded it to $70 billion in April. However, in the previous quarter, the company only spent $15 billion on stock repurchases.
In comparison, Apple has returned nearly $450 billion to shareholders in the past five fiscal years, exceeding the $454 billion in cash it generated by nearly $5 billion.
In July of this year, Alphabet-C-C-C-C-C-C-C-C-C-C-C announced that CFO Ruth Porat would be reassigned to the newly created position of President and Chief Investment Officer.
Unlike Apple and Microsoft, Alphabet-C-C-C-C-C-C-C-C-C-C-C does not pay dividends. Compared to Microsoft, which agreed to acquire game manufacturer Activision Blizzard (ATVI.US) for $69 billion last year, Alphabet-C-C-C-C-C-C-C-C-C-C-C has been avoiding large-scale acquisitions.
Even if executives have the intention to engage in mergers and acquisitions, companies may not be able to complete large-scale acquisitions due to increased regulatory scrutiny. For example, Microsoft's acquisition of Activision has been facing difficulties, and Amazon's acquisition of iRobot, the manufacturer of Roomba, is still under investigation by regulatory agencies.
Angelo Zino, Senior Equity Analyst at CFRA Research, said that in the current regulatory environment, it may be difficult to conduct large-scale acquisitions like Microsoft did. Alphabet, on the other hand, is more likely to continue incremental transactions on a very small scale.
Aniel Morgan believes that Alphabet may be wiser to make more strategic investments, just like what Microsoft did with the owner of ChatGPT, OpenAI. This would immediately enhance shareholder value and help the company gain recognition in industries where it traditionally lacks expertise. However, for now, stock buybacks seem to be the most popular tool for large tech companies to return cash to shareholders.
Zino stated, &#34;While Alphabet could consider issuing a small dividend, we believe they are more likely to stick with buybacks. Dividends may give the impression that growth opportunities are not as strong.&#34; Over the past decade, Apple has initiated the largest stock buyback program on Wall Street, resulting in a significant decrease in its outstanding shares. The company has repurchased over $80 billion worth of stock in the past 12 months, making it the most active buyer of shares among US companies.

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Alphabet-C's parent company, Alphabet-C, is facing a new challenge: how to spend its ever-growing cash reserves.

Alphabet-C1180's whereabouts of the $118 billion cash reserve, despite having a huge amount of funds, remains uncertain regarding the buyback.