Learn the stock market › Dividends › Lesson 1 of 5
What is a dividend and how does it work?
Cash from the company to its owners
A company that makes a profit can do two things with the money. It can keep it and spend it on the business, or pay part of it out to the owners. What it pays out is a dividend.
The dividend is set per share. If a company declares $0.50 per share and you own 200 shares, you receive $100 before tax.
Who decides?
In a US company the board of directors declares the dividend. It sets the amount per share, the record date, when you must be on the company's books as a shareholder, and the date the cash is paid. Most large US companies declare a dividend every quarter. What the dates mean is in When do you get the dividend?
Nothing obliges a company to keep paying. A board can raise, cut or stop the dividend at any declaration, which When are dividends cut? is about.
One company, year by year
This is what JPMorgan Chase has paid per share in each calendar year since 2016, counted by the date it went ex-dividend.
| Year | Dividend per share |
|---|---|
| 2016 | $1.84 |
| 2017 | $2.04 |
| 2018 | $2.48 |
| 2019 | $3.30 |
| 2020 | $3.60 |
| 2021 | $3.70 |
| 2022 | $4.00 |
| 2023 | $4.05 |
| 2024 | $4.60 |
| 2025 | $5.55 |
| Last 12 months | $6.15 |
JPMorgan Chase raised its dividend in 9 of those 9 years, from $1.84 in 2016 to $5.55 in 2025.
Not every company pays
14 of the 20 largest US companies we follow paid a dividend in the last 12 months.
Six paid nothing since 2016: Amazon, Tesla, Berkshire Hathaway, Netflix, Palantir and AMD.
Fast-growing companies often keep their profit to invest, and many large US companies return cash by buying back their own shares instead. That is in What is a stock buyback?
The dividend shows in the price
When the cash leaves the company, each share is worth about that much less. So the price usually falls by roughly the dividend on the ex-dividend date, and the owner has lost nothing: what left the price arrives as cash. Real ex-dates are in Why does a stock fall on the ex-dividend date?
To see what a number of shares has paid year by year, use the dividend calculator.
Test yourself
A company declares $0.75 per share and you own 400 shares. How much do you receive before tax?
Sources
- Investor.gov (SEC), Ex-Dividend Dates: When Are You Entitled to Stock and Cash Dividends, read on November 5, 2026.
How the stock moved: Why did JPMorgan Chase move?