In March, Senator Tammy Baldwin, Wisconsin Democrat, introduced legislation that would restrict companies’ ability to buy back stock, though the bill has little chance of passing.
Other academics and investors cheered Apple’s continued returns to shareholders.
“People like to believe the stories that C.E.O.s do things to boost the short-term stock price and line their own pockets,” said Alex Edmans, a finance professor at the London Business School. “But if you look at hundreds of examples, you find that stock buybacks do increase long-term value.”
He said that companies typically bought back stock only when they had extra cash that they would not reinvest otherwise, and that investors would spend that money elsewhere.
Apple said its profit increased 25 percent to $13.8 billion in the most recent quarter on the back of strong revenue growth for iPhones, the Apple Watch and its services business. Apple earned $2.73 a share, it said, beating Wall Street estimates by 6 cents. Revenue rose 16 percent to $61.1 billion.
The three months ending with March were Apple’s first full quarter selling its new flagship phone, the iPhone X. Analysts had pointed to signs, including the financial results of Apple’s suppliers, that the device and its sister iPhone 8 and 8 Plus had not revitalized Apple’s iPhone business as the company had hoped. Many analysts lowered their estimates for Apple in recent weeks as a result.
Apple said it sold 52.2 million iPhones in the quarter, or 3 percent more than a year earlier. But an 11 percent increase in their average price — driven by the $1,000 iPhone X — helped raise iPhone revenue by 14 percent.
Timothy D. Cook, Apple’s chief executive, hit back at the notion that the iPhone business, which accounts for 62 percent of the company’s overall revenue, had little room to grow. “I don’t buy the view that the market is saturated,” he said.