Meta Breaks Ground: Announces First-Ever Dividend and Authorizes $50 Billion Share Buyback

Meta’s Strategic Moves Signal Maturity and Capital Return, Joins Peers with Historic Dividend Payout

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In a significant strategic shift, Meta Platforms, the parent company of social media giant Facebook, has announced its decision to pay a quarterly dividend for the first time in its history. The company also unveiled an expanded share buyback program, authorizing up to $50 billion in repurchases.

The per-share dividend of 50 cents places Meta in the company of tech peers such as Apple, Microsoft, and Oracle, all of which regularly issue dividends. Meta’s board has expressed its intention to provide a cash dividend on a quarterly basis, contingent upon prevailing market conditions.

Meta’s fourth-quarter financial results, which surpassed estimates on both the top and bottom lines, accompanied these landmark announcements. The news sparked a notable surge in Meta’s stock, rising over 14% in extended trading.

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Chief Financial Officer Susan Li emphasized the introduction of the dividend as a move toward a more balanced capital return program, providing added flexibility for future capital return strategies. Li shared these insights during the company’s earnings call, where Meta’s positive financial performance and strategic decisions took center stage.

This latest development follows Meta’s remarkable stock performance in 2023, where the company’s market capitalization nearly tripled. The extended trading rally further solidifies Meta’s position in the market, with its current market cap standing at $1 trillion.

The $50 billion share buyback program represents about 5% of Meta’s outstanding shares, underlining the company’s commitment to returning value to its shareholders. As of December, Meta had $30.9 billion available for share repurchases.

The dividend payout is scheduled for March, benefiting all shareholders of record as of February 22. Meta’s decision to initiate a dividend and embark on a substantial share buyback signals a maturation phase for the company, aligning it with industry trends where tech giants increasingly leverage their financial strength to reward investors.

It’s worth noting that Meta’s move contrasts with industry counterparts like Amazon and Alphabet, neither of which has ever issued dividends. Microsoft initiated its dividend program in 2003, while Oracle followed suit in 2009. Meta’s strategic pivot reflects its evolving role in the tech landscape and its commitment to delivering shareholder value.