Alphabet, the parent company of Internet giant Google, has successfully leapfrogged tech giant Apple Inc. to become the most cash-rich company in the world.
According to a report by the Financial Times, Alphabet holds $117 billion in liquid reserves. Apple, on the other hand, has $102 billion.
However, while this seems like a huge, positive deal, it isn’t particularly so. As the report notes, this display of obscene wealth could pile on the pressure from shareholders who want to see more dividends and share buybacks. It could also lead to even more scrutiny from regulators who fear the increasing dominance of Google.
In the past 2 years, Google and Alphabet have been hit with about $9.05 billion in antitrust fines from the European Union. It is also facing some massive scrutiny from lawmakers in the United States.
Apple itself isn’t doing so badly as well. The company reduced its liquidity on purpose, and its reserves have fallen by $61 billion since 2017. They’ve been able to capitalize on U.S. tax reforms to repatriate its foreign reserves and make investor payouts.
However, Alphabet’s cash reserves have grown by $20 billion in that time frame. This is despite the increased real estate investments, including data centers and office spaces.
Also, despite this new milestone, the “most valuable company” has eluded Alphabet till now. Apple hit $1 trillion last year, but its market cap has dipped. Now, Microsoft and Amazon have overtaken Apple in terms of net worth, with the latter being the only one to be valued at over $1 trillion presently.
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