Alphabet
We can ask NotebookLM directly to assign the appropriate weight.
- Where does the FCF the company generates go?
Prompt:
Analyze all the documents and answer as clearly as possible: What priority does the company give to the following? Reinvestment in the business, share buybacks, debt repayment, dividend payments and cash accumulation.
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Based on 2025 financial reports and management statements, Alphabet sets a clear order of priorities for the use of its capital, placing technology growth and AI infrastructure above any other objective.
The priority hierarchy according to the documents is set out below:
1. Reinvestment in the business (Top priority)
The company identifies reinvestment as its primary use of capital to ensure long-term growth.
- Investment in AI and infrastructure: In 2025, Alphabet allocated $91.447 billion to capital expenditure (CapEx), focused on servers and data centers.
- Massive acceleration: For 2026, the priority increases sharply, with projected CapEx of $175 to $185 billion to meet demand for AI computing.
- R&D: Investment in research and development totaled $61.087 billion in 2025, a 24% year-on-year increase to strengthen its Gemini models.
2. Share buybacks
This is the main mechanism for returning capital to shareholders, receiving a much larger allocation of funds than dividends.
- Volume: During 2025, the company allocated $45.398 billion to repurchase and retire 240 million of its own shares.
- Future commitment: The board of directors authorized a new $70 billion program in April 2025, of which $69.5 billion remains available.
3. Cash accumulation and acquisitions
Alphabet maintains an extremely strong liquidity position to fund “strategic opportunities” and strengthen the balance sheet.
- Reserve: As of year-end 2025, the company had $126.843 billion in cash and marketable securities.
- Strategic acquisitions: This cash is vital for large-scale acquisitions already committed for 2026, such as Wiz ($32 billion) and Intersect ($4.8 billion).
4. Dividend payments
Although an established priority, it is secondary to share buybacks.
- Figures: In 2025, Alphabet paid $10.049 billion in total dividends, less than a quarter of what it allocated to buybacks.
- Policy: The company pays $0.21 per share quarterly but emphasizes that these payments are discretionary and evaluated according to capital structure and market conditions.
5. Debt repayment (Low priority)
Debt reduction is not a current strategic priority. In fact, Alphabet is increasing its leverage to fund its operations and capital needs.
- Increase in debt: In 2025, the company issued new debt with a net value of $37.3 billion.
- Trend: Long-term debt rose from $10.883 billion in 2024 to $46.547 billion in 2025. Although it made payments of $32.427 billion, the overall strategy has been to raise new funding to support its ambitious expansion plans.
- Dividend payments: has the company ever announced a flexible dividend or scrip dividend in its history?
Prompt:
Analyze all the documents and answer as clearly as possible: Has the company ever declared a flexible dividend in its history?
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Based on Alphabet’s financial documents for 2023, 2024 and 2025, the company has not declared a “flexible dividend” (also known as scrip dividend, where the shareholder chooses between cash or new shares).
The nature and recent history of its dividends according to the source are set out below:
1. Nature of dividends
Alphabet maintains a cash-only dividend program. The company states that its program pays “regular cash dividends” to holders of Class A, Class B and Class C shares. Nowhere in the reports is there any mention of the option to receive the dividend in shares or under a flexible arrangement.
2. History of the dividend program
Over the periods reported in the documents, the following trend is observed:
- 2023: Alphabet did not pay dividends to its shareholders during this period.
- 2024: The company began paying dividends, declaring a total of $0.60 per share for the year.
- 2025: Alphabet increased its payout, declaring a total of $0.83 per share. In April 2025, the Board of Directors increased the quarterly dividend by 5%, setting it at $0.21 per share.
3. Future commitments
The company has stated its intention to continue paying quarterly cash dividends in the future, although it clarifies that any future decision is at the discretion of the Board of Directors based on factors such as earnings, liquidity and market conditions.
In conclusion, Alphabet’s dividend history is recent (starting in 2024) and has been strictly limited to cash payments, alongside an aggressive share buyback program as its main method of returning capital to shareholders.