By Prince Osuagwu
Intel Corporation has announced that its board of directors has approved a 16 percent increase in the quarterly cash dividend to 21 cents per share. This translates to 84 cents per share on an annual basis, beginning with the dividend that will be declared in the third quarter of 2011.
The announcement is the second dividend increase in the past 6 months. Intel previously raised the dividend 15 percent in November 2010.
Its dividend payout has steadily increased at a 33 percent compound annual growth rate (CAGR) since 2003, compared to the Standard & Poor, S&P 500 growth rate of 6 percent over the same period.
According to Intel president and CEO, Mr Paul Otellini, “worldwide demand for computing continues to increase at a very rapid rate, putting Intel on track for revenue growth of over 20 percent this year, delivering another record year for the company.
Intel’s current and projected growth is generating strong cash flow, allowing us to further increase our dividend. We are delivering on our commitment to return cash to shareholders with annual dividend growth that’s already more than five times the S&P 500″.
In addition to raising the dividend over 30 percent in the past 6 months, Intel also increased the authorization limit for share repurchases by an additional $10 billion in January, bringing the total outstanding buyback authorization to $14.2 billion.
In the first quarter of 2011, Intel used $4 billion of the total buyback authorization to repurchase shares. Since the company’s stock buyback program began in 1990 and through the end of the first quarter of 2011, Intel repurchased approximately 3.6 billion shares at a cost of approximately $74 billion.
Intel began paying a cash dividend in 1992 and has paid out approximately $22 billion to its shareholders in dividends. Intel cash dividends for 2010 totaled approximately $3.5 billion.
Taken together since their inception, Intel’s dividends and stock buyback program have returned approximately $96 billion to shareholders.
physical/infrastructure conditions in countries where Intel, its customers or its suppliers operate, including military conflict and other security risks, natural disasters, infrastructure disruptions, health concerns and fluctuations in currency exchange rates.
Intel’s results could be affected by the timing of closing of acquisitions and divestitures.
Intel’s results could be affected by adverse effects associated with product defects and errata and by litigation or regulatory matters involving intellectual property, stockholder, consumer, antitrust and other issues, such as the litigation and regulatory matters described in Intel’s SEC reports.
An unfavorable ruling could include monetary damages or an injunction prohibiting us from manufacturing or selling one or more products, precluding particular business practices, impacting Intel’s ability to design its products, or requiring other remedies such as compulsory licensing of intellectual property.
A detailed discussion of these and other factors that could affect Intel’s results is included in Intel’s SEC filings, including the report on Form 10-Q for the fiscal quarter ended April 2, 2011.
Intel is a world leader in computing innovation. The company designs and builds the essential technologies that serve as the foundation for the world’s computing devices.