Corporations normally don't hoard cash the way Apple does. They keep enough on hand for immediate needs, and either invest the rest in their operations or hand it out to shareholders in the form of dividends or stock buybacks. If they need more cash for, say, an acquisition, they borrow it.
Einhorn told CNBC on Thursday that Apple was acting like his grandmother "Roz," who grew up during the Great Depression. People who've experienced financial trauma, he said "sometimes feel like they can never have enough cash."
Roz was so careful about saving money, Einhorn said, that she never left messages on his answering machine out of concern that she'd be charged for the call.
Einhorn's criticism hints at Apple's lean years in the mid-90s. Former CEO Steve Jobs came out of that experience with a very tight hold on the company's purse strings. Apple has never explained its reasons for hoarding the cash other than to say it is preserving its options. Since his death in Oct. 2011, Apple has begun paying a quarterly dividend of $2.65 per share and started to repurchase some of its shares.
Analysts say the company should be doing more if it wants to lure investors back to its shares. Stuart Jeffrey at Nomura Securities calculates that Apple will generate about another $103 billion over three years to add to the $137 billion it has now, but it has only committed to returning $45 billion of this $240 billion in total cash to shareholders.
Wall Street didn't complain much about Apple's hoarding policies until its revenue growth started slowing. In the recent holiday quarter, Apple's revenue rose 18 percent from a year ago — a very good figure for a company of its size, but a far cry from the 50 percent-plus increases it has often posted since the 2007 launch of the first iPhone. Apple hasn't launched a new ground-breaking product since the iPad in 2010, so the company is forced to expand the appeal of its current products to achieve growth.