Yahoo Finance Google owner worth more than $2 trillion after announcing first dividend
Google’s parent company soared past a $2 trillion valuation last night as the search engine giant said it would pay a dividend for the first time.
Shares in Alphabet rose by more than 12pc to a record high as the company announced the payout to shareholders, alongside a $70bn (£56bn) share buyback scheme.
Microsoft shares also rose after the world’s most valuable company revealed record profits. It meant both tech giants shrugged off a tech sell-off earlier in the day triggered by fears about the artificial intelligence (AI) boom.
Alphabet reported revenues of $80.5bn for the first quarter of the year, a 15pc rise, and said profits had climbed by 57pc to $23.7bn.
It said it would pay shareholders a quarterly dividend of 20 cents a share, amounting to a payout of more than $2.5bn, and that it planned to continue paying quarterly cash dividends in the future. It comes after Meta said it would pay its first dividend in February.
Microsoft shares climbed by more than 5pc after sales jumped on growing demand for its AI technology. Quarterly revenues rose 17pc to $61.9bn while profits were up 20pc, at $21.9bn.
Google has faced questions about whether it is falling behind companies such as OpenAI, the maker of the popular ChatGPT chatbot, as well as concerns that the rise of AI could threaten its lucrative search engine.
Microsoft, meanwhile, has been seen as one of the biggest beneficiaries of the ChatGPT craze. It is a major investor in OpenAI and has built the chatbot into many of its own products. It overtook Apple as the world’s most valuable listed company earlier this year.
But investors had questioned whether the hype and heavy spending around AI is turning into tangible revenues.
The figures came after a wider tech sell-off earlier in the day after Facebook owner Meta reported disappointing results on Wednesday night. The tech-heavy Nasdaq index had fallen by as much as 2pc before a slight recovery.
Meta’s chief executive Mark Zuckerberg saw his personal wealth drop by more than $17bn after Meta’s stock plunged by 10pc as investors baulked at his plans to invest billions into AI.
The billionaire, whose fortune is almost entirely made up of his shares in the company, lost his position as the world’s third-richest person to Elon Musk this week after a leap in Tesla’s shares made a recovery.
Mr Zuckerberg is now worth approximately $150bn following a share price rout last night. Mr Musk is worth about $179bn as of yesterday.
More than $100bn was wiped from Meta’s market value as investors baulked at Mr Zuckerberg’s plans to spend heavily on AI technology.
