AUSTIN, Texas (AP) - Computer maker Dell Inc. said Tuesday that it will soon pay its first dividend.
Dell was one of many technology companies that did not pay a dividend. But the company said its strong cash flow will enable it to add a dividend program beginning in the third quarter.
The Austin, Texas-based company plans to pay a quarterly dividend of 8 cents per share, which represents a yield of 2.7 percent based on the closing price of the company's shares on Monday.
"Our efforts to streamline our operations and shift the mix of our business over the past several years have resulted in sustainably strong cash flow from operations, enabling us to increase the percentage of capital we've allocated to research and development, capital expenditures and acquisitions while maintaining an ongoing share repurchase program," Brian Gladden, Dell's chief financial officer, said in a statement. "The payment of a quarterly cash dividend to Dell's shareholders adds another element to our disciplined capital allocation strategy."
The announcement coincided with the start of Dell's annual analysts meeting Tuesday.
Dell shares rose 36 cents, or 3 percent, to $12.33 in after-hours trading. The stock rose 11 cents to close at $11.97 in the regular session.
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