Google'sparent announces first-ever dividend, sending shares soaring: 'Breath of fresh air'

Published

1 year ago

April 26, 2024

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Alphabetannounced its first-ever dividend on Thursday and a $70 billion stock buyback, cheering investors who sent the stock surging nearly 16% after the bell.

The Google parent is returning capital while spending billions of dollars on data centers to catch up with rivals on generative artificial intelligence. The dividend will be 20 cents per share.

Just three months ago, Alphabet’s Big Tech rival, Meta Platforms, announced its own first-ever dividend, a move that lifted the social media company’s stock market value by $196 billion the following day. Amazon remains the lone holdout among Big Tech firms not offering a dividend.

Alphabet beat expectations for the quarter in sales, profit and advertising – metrics that are all closely watched.

“Alphabet’s announced dividend payouts and buybacks on top of the solid earnings beat are not only a breath of fresh air for the tech market as a whole, but also a very intelligent strategy for the search engine giant going into a tough time of the year,” said Thomas Monteiro, senior analyst at Investing.com.

Alphabet’s after-hours share surge of nearly 16% following the report increased its stock market value by about $300 billion to over $2 trillion.

In a call to discuss results, CEO Sundar Pichai touted Google’s AI offerings as a boon to its core search results. “We are encouraged that we are seeing an increase in search usage among people who are using the AI overviews,” he said.

Revenue was $80.54 billion for the quarter ended March 31, compared with estimates of $78.59 billion, according to LSEG data.

The search firm’s beat on first-quarter revenue was powered by rising demand for its cloud services on the back of increasing adoption of artificial intelligence and steady advertising spending.

Google reported advertising sales rose 13% in the quarter to $61.7 billion. That compares with the average estimate of $60.2 billion, according to LSEG data.

Alphabet is coming off a fourth quarter in which ad sales missed the mark, sending shares tumbling, amid rising competition from Amazon, Facebook and new entrants like TikTok. The latter faces an uncertain future after President Biden signed a bill that would ban the popular app if it is not sold within the next nine to 12 months.

Meanwhile, Google Cloud revenue grew 28% in the first quarter, boosted by a boom in generative AI tools that rely on cloud services to deliver the technology to customers.

Alphabet’s capital expenditures were $12 billion, a 91% rise from a year prior, a figure Gabelli Funds portfolio manager Hanna Howard called “higher than anticipated.”

Still, CFO Ruth Porat said on the call with analysts that she expects such expenditures to be at that level or higher throughout the remainder of the year, as the company spends to build artificial-intelligence offerings.

Despite the surge in capital expenditures, Porat said operating margin in 2024 would be higher than last year, without elaborating.

Google’s cloud services are attractive for venture capital-backed startups developing generative AI technologies due to their pricing and ease of integration with other tools, investors and experts have previously said.

Google has touted its AI-powered chatbot, Gemini, as a panacea for automation, from coding to document creation. The software was widely criticized, however, after it was found to generate historically inaccurate images, including of former US leaders and World War Two-era German soldiers.

Google has said it is aware of the issues and is working to address them.

Business

Trump’s tariffs are back – here’s who is in his sights this time

Published

1 hour ago

August 1, 2025

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'A BIG DAY FOR AMERICA!!!' - Trump's tariffs are back, and will affect dozens of countries

It is “Liberation Day” III – the third tariff deadline set by Donald Trump.

Countries without bilateral trade agreements will soon face reciprocal tariffs – ranging from 25% to 50% – with a baseline of 15% to 20% for any not making a deal.

He has delayed twice, from April to July and from July to August, but hammered this date home in his trademark caps-on style: “THE AUGUST FIRST DEADLINE STANDS STRONG, AND WILL NOT BE EXTENDED. A BIG DAY FOR AMERICA!!!”

“Will not be extended” for anyone but Mexico, it seems. The country secured a 90-day extension at the last minute, with Mr Trump citing the “complexities” of the border.

By close of business on the eve of deadline, he had a handful of framework deals – some significant – including the UK (10%), the EU, Japan and South Korea (15%), Indonesia and the Philippines (19%), Vietnam (20%).

On the EU agreement, which he struck in Scotland, the president said: “It’s a very powerful deal, it’s a big deal, it’s the biggest of all the deals.”

But what happened to the “90 deals in 90 days” touted by the White House earlier this year?

The short answer is they were replaced by letters of instruction to pay a tariff set by the US.

Amid of flurry of late activity, the US played hardball with major trading partners like Canada.

“For the rest of the world, we’re going to have things done by Friday,” said US Commerce Secretary Howard Lutnick – the “rest of the world” meaning everyone but China.

There is, apparently, the “framework of a deal” between the world’s two largest economies, but talks between Washington and Beijing are continuing.

In terms of wins, he can claim some significant deals and point to his tariffs having generated an impressive $27bn (£20.4bn) in June, not bad for a single month.

But the legality of the approach is under siege – with the US Court of International Trade ruling that the “Liberation Day” tariffs exceeded the president’s authority, with enforcement paused pending appeal.

The deadline has stirred the pot, forcing a handful of deals onto the table. Whether they stick or survive legal scrutiny is far from settled.

But the playbook remains the same – threaten the world with trade chaos, whittle it down, celebrate the wins, and pray no one checks what’s legal.

Politics

Michael Saylor joins chorus for clarity as US works to legally define crypto

Published

2 hours ago

August 1, 2025

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Michael Saylor joins chorus for clarity as US works to legally define crypto

Strategy’s Michael Saylor wants the US government to clearly define digital securities and commodities, as well as state when it is allowable to tokenize securities.

Entertainment

Flintoff praises NHS staff who treated him after crash, as doctor says his injuries were ‘among most complex’ he’s ever seen

Published

3 hours ago

August 1, 2025

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Flintoff praises NHS staff who treated him after crash, as doctor says his injuries were 'among most complex' he's ever seen

Andrew Flintoff has praised the “love and compassion” of “superhero” staff in a visit to the hospital that treated him after his crash.

The cricket legend was seriously injured during the incident on the Top Gear track in Surrey in December 2022.

He was airlifted to St George’s in Tooting, with a surgeon calling Flintoff’s injuries some of the most complex he’s seen.

“I just want to say a massive thank you to all the staff at St George’s,” Flintoff said, as he returned to the London hospital.

“I came here probably the lowest I’ve ever been, in need of help and the expertise, the love, the compassion they showed me was incredible.

“I’ll be eternally grateful – absolute superheroes.”

Jahrad Haq, a maxillofacial surgeon, said he knew immediately the case was something out of the ordinary.

“I was on call that day and received a phone call from the emergency department consultant,” said Mr Haq.

“A lot of injuries are managed at a more junior level before escalating, so I knew this one was serious.

“Of all the trauma cases I’ve seen in over 20 years, this was among the most complex.”

Flintoff was also pictured on his visit meeting lead dental nurse Linda Holden and principal orthodontic nurse Sonia Steer.

Shamim Umarji, who also treated the 47-year-old, said it was “wonderful to see Freddie again and his visit gave staff a real boost”.

“He spent a lot of time chatting to everyone and it meant a lot,” added the trauma and orthopaedic surgeon.

Flintoff previously described how he thought he had died in the accident – which saw him “pulled face-down on the runway” for about 50m under a three-wheel car.

The incident led to the BBC pulling the plug on Top Gear and it remains unclear if it will ever return.