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Dividends, yield and payout ratio
How dividends get paid, the three numbers that describe them, and what happens when a company pays more than it earns.
The short answer
A dividend is cash a company pays its shareholders, usually every quarter. Dividends per share is the yearly total for one share; the dividend yield is that amount divided by the share price; the payout ratio is dividends divided by earnings. Coca-Cola's dividends for fiscal 2025 came to $2.04 per share, about 67.1% of its diluted EPS of $3.04.
How a dividend gets paid
The board of directors decides each dividend; nothing obliges a company to pay one. Each one has four dates:
- Declaration date: the board announces the amount per share and the dates, often in a press release or an 8-K.
- Ex-dividend date: shares bought on or after this day don't get the dividend. On that morning the share price usually drops by about the dividend amount, all else equal.
- Record date: the company checks who owns shares. Under the one-day US settlement cycle it's normally the same day as the ex-dividend date.
- Payment date: the cash arrives in shareholders' accounts.
Three numbers to know
Dividends per share = total for one share over a year
Dividend yield = dividends per share ÷ share price × 100
Payout ratio = dividends per share ÷ earnings per share × 100
Dividends per share and the payout ratio come straight from the 10-K. The yield needs a share price, so it changes every trading day; the dividend yield calculator works it out from a price you type.
Apple declared $1.02 per share for fiscal 2025 and paid out $15.4B in dividends in total, shown in the financing section of its cash flow statement.
Source: Apple 10-K for fiscal 2025, filed Oct 31, 2025
Raising the dividend
Many companies try to raise their dividend a little every year. Coca-Cola's dividends per share went from $1.84 in fiscal 2023 to $2.04 in fiscal 2025, up 10.9% over two years. It paid $8.8B in dividends in fiscal 2025.
Source: Coca-Cola 10-K for fiscal 2025, filed Feb 20, 2026
When dividends are bigger than earnings
A payout ratio above 100% means a company paid more in dividends than it earned that year. It can happen when earnings drop for a year, for example because of a large one-time charge, while the dividend stays where it was. AbbVie paid $6.65 per share for fiscal 2025, against diluted EPS of $2.36, a payout ratio of about 281.8%. A company can cover the gap from cash flow, cash on hand or borrowing, which is why many readers compare dividends with free cash flow as well as earnings. In the table below, 9 of the 77 companies paid more than their EPS.
Source: AbbVie 10-K for fiscal 2025, filed Feb 20, 2026
Special dividends and cuts
A special dividend is a one-time payment on top of the regular one. Costco's dividends per share were $19.36 in fiscal 2024, the year it paid a special dividend, then $4.92 and $5.54 in the two years after.
Dividends can also go down. 3M's fell from $6.00 per share in fiscal 2023 to $2.92 in fiscal 2025, after it spun off its health care business as a separate company in 2024 and reset its dividend. The 10-K and the company's announcements explain the reasons for any change.
Source: Costco 10-K for fiscal 2026, filed Oct 7, 2026 · 3M 10-K for fiscal 2025, filed Feb 3, 2026
Companies that don't pay one
Many companies pay no dividend at all and use their cash for investment, acquisitions or share buybacks, which also return cash to shareholders but in a different way. Whether a company pays a dividend says nothing on its own about how profitable it is.
Dividends and payout ratios for 77 companies
Latest fiscal year from each company's 10-K, sorted by payout ratio (dividends per share divided by diluted EPS). Dividends per share are the amounts declared for the year, or paid where that's what the company reports. Companies that don't pay a dividend, report a loss, or don't tag dividends per share in their filings aren't listed. A payout ratio above 100% means the year's dividends were larger than its earnings.
Common questions
What is a dividend?
A cash payment from a company to its shareholders, decided by the board of directors, usually paid every quarter. It's a set amount per share, so someone with 100 shares gets 100 times the per-share amount.
How do you calculate dividend yield?
Divide the yearly dividends per share by the share price and multiply by 100. Coca-Cola's dividends per share for fiscal 2025 were $2.04, so its yield on those dividends is $2.04 divided by the share price. Source: Coca-Cola 10-K for fiscal 2025.
What is a payout ratio?
Dividends per share divided by earnings per share, as a percentage. Coca-Cola's was about 67.1% for fiscal 2025: $2.04 of dividends against diluted EPS of $3.04. Source: Coca-Cola 10-K for fiscal 2025.
What is the ex-dividend date?
The first day a share trades without the right to the next dividend. Shares bought on or after that day don't receive it; the seller keeps it.
Does a company have to keep paying its dividend?
No. The board decides each dividend and can raise, cut, suspend or skip it. Past dividends describe what a company has paid, not what it will pay.
Disclosures
- Editor holdings
- The editor holds no position in any company named on this page. As of Oct 25, 2026.
- Compensation
- Nobody paid for this page. No affiliate links on this page.
- Sources
- Each company's own SEC filings, linked next to each number.
- Last updated
- Oct 26, 2026
General education, the same for every reader. Not a recommendation to buy, sell or hold any security, and it doesn't consider your situation.
More in Learn and Tools · Methodology & Disclosures explains where every number comes from.