Interesting that they think they're out of internal projects and acquisitions to (profitably) spend money on. Even more interesting that the stock seems to agree -- I guess investors already believed that growth is over, and are seeing this recognition of that as an alignment between reality and internal strategy.
Maybe or investors also know that Meta recently started a dividend and the stock moved up, and they see the same play here and hope for the same results. I don't think the market move is much deeper for most investors.
This is basically it. Investors and board reps saw Meta stock go up with dividend. Once they see that, there is no way that they'll not pressure the Google to copy it and boost stock price.
This is a flat rate dividend, which at the current price equates to a 0.1% dividend. It seems more likely that it's just designed to satisfy a checkmark on the portfolio investor prospectus. This equates to ~$2B payout, while they simultaneously announced another $70B stock buy back.
Overall Google announced they spent $12B on server and datacenters capex in Q1. This is up 100% y/y. Also this spending level will continue for at least the rest of the year, that's $50B in capex spending in a single year... But people are going to focus on a $0.20 dividend I suppose.
It's difficult to say that they're not continuing to invest in future tech. Focusing on the dividend announcement is a nothing burger (for now)
honestly, I see this as a sign of Google bureaucracy/cost-cutting taking over the company's culture. Considering how much innovation in tech is happening right now, blowing cash on a dividend rather than internal projects that could make big returns seems like its completed its journey to becoming the next IBM
So glad they fired so many people. Otherwise they might have gone bankrupt and the stock crashed to zero. Prevented just in time to announce record profits, stock surges to all-time highs and buybacks of $70,000,000,000 with all that salary money saved.
Different shareholders have different preferences for how money should be returned to them.
A buyback is tax efficient but very abstract as the share price may actually fall during a buyback meaning that it's harder to see the money being returned to you.
With a dividend you actually get cash in your brokerage account which is much more visible, even if you have to pay tax on it immediately.
I guess appealing to both groups of investors is better than appealing to just one?
Interesting that they think they're out of internal projects and acquisitions to (profitably) spend money on. Even more interesting that the stock seems to agree -- I guess investors already believed that growth is over, and are seeing this recognition of that as an alignment between reality and internal strategy.
Maybe or investors also know that Meta recently started a dividend and the stock moved up, and they see the same play here and hope for the same results. I don't think the market move is much deeper for most investors.
This is basically it. Investors and board reps saw Meta stock go up with dividend. Once they see that, there is no way that they'll not pressure the Google to copy it and boost stock price.
This is a flat rate dividend, which at the current price equates to a 0.1% dividend. It seems more likely that it's just designed to satisfy a checkmark on the portfolio investor prospectus. This equates to ~$2B payout, while they simultaneously announced another $70B stock buy back.
Overall Google announced they spent $12B on server and datacenters capex in Q1. This is up 100% y/y. Also this spending level will continue for at least the rest of the year, that's $50B in capex spending in a single year... But people are going to focus on a $0.20 dividend I suppose.
It's difficult to say that they're not continuing to invest in future tech. Focusing on the dividend announcement is a nothing burger (for now)
honestly, I see this as a sign of Google bureaucracy/cost-cutting taking over the company's culture. Considering how much innovation in tech is happening right now, blowing cash on a dividend rather than internal projects that could make big returns seems like its completed its journey to becoming the next IBM
So glad they fired so many people. Otherwise they might have gone bankrupt and the stock crashed to zero. Prevented just in time to announce record profits, stock surges to all-time highs and buybacks of $70,000,000,000 with all that salary money saved.
Welfare queen.
Related:
Google Earning Q1 2024 [pdf]
https://news.ycombinator.com/item?id=40162354
Google has been doing stock buybacks for years. Why are they pivoting to also doing a dividend? Bigger short term stock bump?
Different shareholders have different preferences for how money should be returned to them.
A buyback is tax efficient but very abstract as the share price may actually fall during a buyback meaning that it's harder to see the money being returned to you.
With a dividend you actually get cash in your brokerage account which is much more visible, even if you have to pay tax on it immediately.
I guess appealing to both groups of investors is better than appealing to just one?
All out of ideas. Slowly they will produce less and less real world value but the share price will go higher and higher.
Time to fade