Apple, Google and Microsoft hold nearly 25pc of all US corporate cash

24 May 2016

Being cash-rich means a lot in corporate America these days, and news that Apple, Google and Microsoft have an accumulated cash reserve that’s worth more than 23pc of the total US corporate cash says a lot about Silicon Valley.

The figures for US corporate cash are eye-watering, with a new report from the investment firm, Moody’s, showing that the tech world is far outpacing other corporations not involved in the financial sector.

Based on Moody’s findings, these non-financial companies had a cash pile of $1.68trn at the end of 2015 – up 1.8pc from $1.65trn in 2014 – of which a considerable wedge, somewhat unsurprisingly, belongs to Apple, which had $215.7bn in cash reserves.

This marks the seventh year running that Apple has been king of cash in the US, and it seems like its crown will remain unchallenged for a few years at least, bar a commercial disaster.

Tech sector dominates top 10

While Apple is certainly outpacing its tech competitors, the tech sector, as a whole, accounts for seven of the top 10 richest companies in the US, the other non-purely-tech companies being pharmaceutical giants Pfizer, Johnson & Johnson and Amgen.

To put the tech sector’s growth into perspective, the year before Apple launched its first iPhone in 2008, 2007, saw 37pc of corporate cash of non-financial companies being generated by tech companies, but this figure had jumped to 63pc in 2015.

The top three companies on the list – Apple, Google and Microsoft – have established themselves as the elite and together account for 23pc of all non-financial corporate cash reserves in the US.

Speaking of the tech sector’s success, Richard Lane, a Moody’s senior VP, said: “While the concentration of cash among the top-rated cash holders continues to grow, so too has the portion held by the technology sector, which accounted for a record 46pc of total cash [including financial businesses] in 2015, up from 41pc in 2014.”

Dollars image via Shutterstock

Colm Gorey was a senior journalist with Silicon Republic