Comment Re:"risk creating" (Score 1) 69
I hear the culture of fear is very real, and additionally has created a pretty uncooperative, hostile environment as everyone hoards knowledge. How about trimming executive salaries a lot? They're clearly worthless.
Another option is cutting back on $20-30 billion in share buybacks every year. Even cutting 15,000 employees saves just a small portion of the cost of the share buybacks. And the share buybacks constitute less than 1% of the total market capitalization, so they don't really have much of an effect on the share price. What's more baffling is that if the buyback money were instead spent on increased dividends, the current dividends could be doubled, and that potentially would increase the share price more than the buybacks.
The real problem is that the executives don't have common sense. Investing gobs of money in a future technology like AI. That's a risky bet, but at least one that is understandable. Buybacks are just throwing someone else's money at something that is known to not make a difference. Executives do the buybacks because it's not their money. Getting rid of employees does decrease operating expenses and increase efficiency, but that assumes that the executives know who to cut, which, of course, is unlikely given that the same executives hired these people in the first place.
It's strange that they don't separate investment in AI vs operating expenses in the rest of the company to keep and expand the markets they have. It's not like they're financially unable to do both - both AI and keeping the resources they need for operations(*). That said, buybacks are better for some than dividends because you pay taxes immediately on dividends while if the same money goes via buybacks you don't have to pay taxes before you realize the profits by selling the stock. Of course, if like most people you have mutual funds it doesn't matter.
(*) Which means more of a constant optimization up or down in the actual units, rather than large cuts everywhere.