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.

Future Human

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