Going for a 'moonshot' is not incompatible with pursuing the interests of shareholders, as long as the potential payout is commensurate with the elevated risk. I don't see IBM being hit with class action lawsuits despite the highly speculative nature of some IBM research.

A for 'a LEGAL obligation to their shareholders to pursue profits,' this is a myth, and putting the word 'legal' in capitals doesn't enhance your argument. Officers of a company have a fiduciary duty to the corporation, and shareholders have a claim on the profits of the corporation, but no law requires that a corporation devote itself to profit above all else - and for good reason, since otherwise activist shareholders might demand that Apple cease the relatively uncertain business of making pretty computers and offer financial services instead, since finance is the single most profitable sector of the US economy.

As a shareholder, you have the right to vote in the election of directors to the board (let's skip over all the differently nuanced varieties of stock or we'll be here all day), and that's it. If you still don't like what the corporation is doing then you have a simple option: sell your shares and invest your money elsewhere.

The corporation's purpose is stated in its articles of incorporation. In Apple's case (and most companies are similar in this respect) it is as follows:

The purpose of this corporation is to engage in any lawful act or activity for which a corporation may be organized under the General Corporation Law of California other than the banking business, the trust company business or the practice of a profession permitted to be incorporated by the California Corporations Code.

Now, the idea of the obligation to maximize shareholder value is often tied to an old legal case, Dodge v. Ford Motor Company, but nowadays most courts look to Shlensky v. Wrigley in which the court held that directors are obliged only to do whatever they consider to be in the best interests of 'the corporation which they serve.'

http://en.wikipedia.org/wiki/Dodge_v._Ford_Motor_Company http://en.wikipedia.org/wiki/Shlensky_v_Wrigley

You might like to read further on the topic from Professor Lynn Stout, who is professor of corporate law at Cornell University and has written a whole book on this topic - summarized at the link below, which also includes a link to the content in pdf form.

https://blogs.law.harvard.edu/corpgov/2012/06/26/the-shareho...

Another example that reflects the spirit of what I believe graphenbeach is trying to say is similar to what some of the pharmaceutical and biotech companies (publicly traded inlcuded) are practicing every day: they perform research and invest very large amounts of money on matters that may or may not lead to a successful (not to mention FDA approved) outcome. Similar to a startup that risks VC, the small chance of a massive payback is what makes this approach attractive to investors & stakeholders. A company like Apple could easily pursue what would be nothing more than a 'diversification' of their otherwise seemingly very conservative financial strategy by going after one or two such high risk high reward projects.

That may be true to some extent, but would be blindsided to a very large potential upside for an affordable risk (you think $100 mio spent on U2's album forced on everybody is a better investment that shareholders approve of?). Google is pursuing several 'Moonshots' that may or may not pan out. It is a matter of assigning SOME resources to the cause that will lead to patents and discoveries on the side that make the difference in the long run. Apple has--at least on the outside--not shown any efforts similar to Google X. I am an Apple shareholder and would certainly vote for assigning part of the research budget to screened approaches of such longer shots.

Says who? What law mandates profits?

Amazon tries very hard to not make a profit, they channel so much back into R&D, expansion, and other operations. Are you saying they could be sued?

If you don't like the performance of the stock, sell it or participate in shareholder votes.

Companies can and do get sued for all kinds of things including bad business decisions or mismanagement. You could sue Apple for not selling ham sandwiches in their stores if you wanted. Just because they get sued doesn't mean they're doing anything wrong.