Warren Buffett Apple investment earned 87 billion USD through Berkshire Hathaway, more than the tech giant was worth in 2009.
Berkshire Hathaway, the holding company of billionaire investor Warren Buffett, has made more money with Apple in 4 years than either company was worth 20 years ago.
The famous investor conglomerate spent about 35 billion dollars (30 billion euros) to acquire about 245 million shares of Apple between 2016 and 2018. Its 5.7% stake in the technology giant was worth about $ 122 billion (105 billion euros) at the close of Friday, meaning it has accumulated a profit of $ 87 billion from its investment in the company alone.
Warren Buffett Apple investment earned 87 billion USD
Apple's market capitalization fell below $ 70 billion (60 billion euros) during the 2008 financial crisis, recovering to $ 87 billion in March 2009, according to YCharts. Since then it has multiplied by more than 20 to reach a record 2.1 trillion dollars last Friday.
Meanwhile, Berkshire's market capitalization was also less than $ 87 billion in October 2000, compared to the current nearly $ 500 billion (420 billion euros), according to YCharts data. Apple's profits, for its part, also exceed Buffett's personal net worth of 78 billion in the last count.
The value of Berkshire's position in Apple is surprising because the iPhone maker is only one of the 41 holdings in its portfolio, which was valued at the end of June at more than 200 billion dollars (170 billion euros).
In addition to its investments, Berkshire also owns dozens of companies such as Geico, see's Candies, and the BNSF Railway and operates in multiple sectors such as insurance, manufacturing, utilities and retail.
End of Warren Buffett Apple investment earned 87 billion USD
Facebook agrees to pay 106 million euros for tax arrears in France
Facebook has agreed to pay 106 million euros to compensate for legal disputes with the French tax authorities, which demanded late payments between 2009 and 2018. In addition to compensation, the amount would include a fine of 22 million euros, which Facebook has not confirmed.
The agreement between the Welsh Government and the company headed by Mark Zuckerberg would come to the end of a round of negotiations that the tax office would have been holding with various technology giants in recent times. Last year, for example, Google closed these tax remedies by admitting— and remunerating-late payments of 465 million euros, in addition to 500 million euros in fines. In the same tax transaction, Apple agreed with the authorities to pay another half a million euros.
Following the news, a Facebook spokesman has assured that the company is "taking seriously" its tax obligations. "We work closely with tax authorities around the world to ensure compliance with all applicable tax laws and to resolve any disputes, as we have done with the French tax authorities," summed up representative A to the French daily Capital, who provided the information this Monday.
The controversy is, in fact, where the taxes of big technology should be paid. In this case, France has, in recent years, been one of the models to be followed in the fight for the control of these companies, under the premise that the income generated there must be taxed in the country itself, not in other more affordable ones such as Ireland.
As far as Europe is concerned, the island hosts the international headquarters of Apple, Google and Facebook, among others, due to the tax benefits offered by the country's policy. Between their borders, large technology companies enjoy a relatively low corporate tax rate (12.5%), compared to 31% in France or 25% of the general rate in Spain.
Until recently, companies like Netflix had managed to optimize their tax accounts by reserving profits from all over Europe in Dublin. But times are changing little by little and, with France in the lead, other European governments have taken steps to tax these entities.
"We pay the taxes we owe in every market we operate," the Facebook spokesperson tells Fortune. "Since 201 we have changed our sales structure so that the revenues of advertisers supported by the team in France are now recorded in this country; this year we are paying 8.46 million euros in tax revenues in France, an increase of almost 50% over last year," he apologizes.
Thus, according to estimates advanced by Capital, Facebook's annual revenue in France would amount to a total of 1.300 million euros (1.500 million dollars).
In addition to compensating for outstanding accounts with the Treasury, the French government is already preparing a second big tax against large US technology companies. In this way, the executive led by Emmanuel Macron has already approved a bill that envisages tariffs of 3% on French revenues (instead of profits) of companies such as Google, Facebook or Amazon, among others.
The introduction of this new tax has been proposed as an interim measure, initially waiting for a global scale organization to determine the location of taxes under the guidance of an organization for Economic Cooperation and Development (OECD) that is waiting. For the time being, the pandemic has delayed its immediate imposition, although the French government has guaranteed that it will begin to apply yes or yes by the end of the year.
Other countries, such as the United Kingdom or Spain, follow the line marked with France and plan similar taxes before 2021 in the face of the attentive gaze of the United States, which could retaliate via tariffs.