Your Money

Why is Amazon still not paying a dividend?

Retail giant reaffirms its focus on reinvestment and on using capital to generate ‘meaningful returns’

An Amazon contract worker pulls a cart of packages for delivery in New York: the tech giant has yet to announce plans to pay shareholders a dividend. Photograph: Angus Mordant/Bloomberg

Proinsias O'Mahony's face
Proinsias O'Mahony
Sun May 5 2024 - 06:00

Aren’t dividend stocks meant to be boring?

No one could say that of the magnificent seven stocks (Microsoft, Apple, Nvidia, Alphabet, Amazon, Meta, and Tesla). However, with Meta and Alphabet recently announcing dividend payments, Amazon and Tesla are now the only members of the aforementioned club not to make such payments.

Tesla won’t be doing so any time soon, given current financial pressures, but there was much talk of Amazon joining the dividend club prior to its recent earnings report. Meta shares spiked in February when it announced its first dividend and a $50 billion share buyback.

Similarly, Alphabet shares soared following strong earnings on April 25th that allowed it to authorise its first-ever dividend and a $70 billion share buyback. Instead, Amazon reaffirmed its focus on reinvestment and on using capital to generate “meaningful returns”. Still, the dividend debate will persist.

READ MORE

After all, Amazon is now, as DataTrek Research’s Nicholas Colas notes, “the last one standing in terms of Big Tech not paying a dividend”.

READ NEXT
LATEST STORIES