The 7 Best Tech Stocks That Pay a Dividend

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The 7 Best Tech Stocks That Pay a Dividend

Most investors don’t consider diversifying their portfolios with dividend-paying technology stocks, as they are typically volatile. However, the best tech stocks that pay a dividend should be considered for every investor!

Until May 26, 2023, tech companies listed on the NASDAQ Composite share index had a combined value of $22 trillion, while the combined value at the end of 2022 was $18 trillion. The increase in value can be attributed to the boom in AI. With this increase in AI technologies, companies can create jobs and increase profits, creating a bullish stance on tech stocks.

The technology sector is constantly changing, with tech stocks becoming reliable, high-yield dividend stocks. With high-growth potential, dividend-paying tech stocks can generate regular income for investors. This income can offset the impact of inflation over time.

In addition, consistent dividend growth indicates excellent corporate governance, a healthy balance sheet, and an effective business model, all of which should promote the long-term growth of the underlying company and raise the likelihood of stock price appreciation.

Let’s discover the 7 best tech stocks that pay a dividend that can generate additional income for investors while diversifying their portfolios.

1. Cisco Systems

  • 5-year average dividend yield: 2.98%
  • TTM dividend yield (as of September 10, 2023): 2.71%
  • Dividend frequency: Quarterly
  • Last dividend payment: $0.39 on July 26, 2023

Cisco Systems should be on every list of the best tech stocks that pay a dividend! The company, which provides hardware and software solutions, is well-known in the networking sector. The company is also known for being a leading Voice over IP (VoIP) service provider to businesses.

Cisco has maintained a dominant position in its industry for many years by consistently supplying high-quality hardware products. Cisco can set competitive prices thanks to its quality, encouraging strong customer loyalty. Cheaper options often need to be repaired, which might increase customer costs.

As an attractive value stock, Cisco has strong earnings and can afford to pay dividends to its shareholders.

Cisco’s Q4 revenue for fiscal 2023 was $15.2 billion, up 16% from the previous year. In its financial year results for fiscal 2023, revenue was $57 billion, an increase of 11% year over year (YoY).

Cisco has paid a dividend since 2011, with consistent dividend increases over the past 13 years. Given its financial situation, Cisco has yet to believe it will stop increasing its annual dividend.

Cisco Systems, Inc. has a 5-year average dividend yield of 2.98%.

©Sundry Photography/Shutterstock.com

2. Texas Instruments, Inc.

  • 5-year average dividend yield: 2.70%
  • TTM dividend yield (as of September 10, 2023): 3.01%
  • Dividend frequency: Quarterly
  • Last dividend payment: $1.24 on August 15, 2023

Texas Instruments is another of the best tech stocks that pay dividends. The company holds a leading global position in analog semiconductor technology. Analog semiconductors play a major role in translating real-world data, such as weather data, into a format that machines can understand and process. The appeal of analog semiconductors lies in their extended product lifecycles, stable sales volumes, and limited competition compared to the broader semiconductor sector.

Texas Instruments is the 8th largest semiconductor company in the world by market capitalization, with a market cap of $149.50 billion as of September 10, 2023.

In its Q2 2023, Texas Instruments reported revenue of $4.53 billion, a 3% sequential increase and a 13% decrease from the same quarter in 2022. The company also reported a net income of $1.72 billion.

In April 1962, Texas Instruments declared its first dividend. Since 2004, the tech company has consistently increased its dividends, growing with a 25% compound annual growth rate (CAGR). As a result of Texas Instrument’s steady free cash flow growth, the dividend it paid out in 2022 only used 73% of free cash flow, supporting the company’s sustainability and dividend growth goals.

Texas Instruments offers a TTM dividend yield of 3.01%.

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3. Qualcomm, Inc.

  • 5-year average dividend yield: 2.44%
  • TTM dividend yield (as of September 10, 2023): 2.92%
  • Dividend frequency: Quarterly
  • Last dividend payment: $0.80 on June 22, 2023

Qualcomm is a semiconductor industry leader in designing, producing, and promoting digital and wireless telecommunications equipment and related services. It can be credited with pioneering the development of Code Division Multiple Access (CDMA), a communications network standard widely used in North America and Asia.

Additionally, Qualcomm has many essential 3G mobile telecommunications patents, notably supporting the iPhone’s incredible commercial success upon release in 2007.

In Q3 of the fiscal year 2023, Qualcomm reported a decline in revenue to $8.44 billion, marking a 23% decrease compared to the previous year’s revenue of $10.92 billion. This drop can be linked to ongoing challenging global economic conditions, which have negatively impacted the company’s sales of components to manufacturers of mobile phones and Internet of Things (IoT) devices.

While its dividend may not be very high, there’s a sense of security in investing in Qualcomm, given its status as one of the market’s largest communications equipment suppliers.

Qualcomm corporate office HQ
Qualcomm issues its dividends quarterly.


4. International Business Machines Corp. (IBM)

  • 5-year average dividend yield: 4.94%
  • TTM dividend yield (as of September 10, 2023): 4.48%
  • Dividend frequency: Quarterly
  • Last dividend payment: $1.66 on September 9, 2023

IBM is a tech giant at the forefront of the personal computer revolution. As a household name, this company has its toes dipped in various sectors within the tech industry. They create and manage computer systems in addition to developing software, networking systems, storage devices, and venturing into microelectronics.

This company stands out because of its massive IT infrastructure network, which reaches many sectors and businesses. Many depend on its technologies and business process services to maintain the smooth running of its operations.

IBM recently released its Q2 2023 financial report with the following highlights:

  • Revenue of $15.5 billion decreased by 0.4% while increasing by 0.4% in constant currency.
  • Software revenue increased by 7%, or 8% when adjusted for constant currency.
  • Consulting revenue increased by 4% and by 6% at constant currency.
  • Infrastructure revenue decreased by 15% or 14% at constant currency.

There are better options than this if you’re looking for a high-yield dividend stock. However, the company is known as a Dividend Aristocrat, as they have increased its dividend for more than 25 consecutive years. Long-term tech dividend investors should also consider this company due to its size and importance in the global business landscape.

largest server companies
IBM has a 5-year average dividend yield of 4.94%.


5. Microsoft

  • 5-year average dividend yield: 1.02%
  • TTM dividend yield (as of September 10, 2023): 0.81%
  • Dividend frequency: Quarterly
  • Last dividend payment: $0.68 on June 8, 2023

Microsoft is a global powerhouse and should be on every investor’s radar as one of the best tech stocks that pay a dividend. With a market capitalization of $2.483 trillion on September 10, 2023, the company is the second most valuable company in the world by market cap.

Microsoft has a strong financial position with its diversified revenue streams. The company broke records from fiscal year 2022 to fiscal year 2023, with its global revenue increasing by around 7% YoY and surpassing $212 billion.

Microsoft has proved itself stable with its revenue to pay its shareholders a quarterly dividend, providing excellent growth opportunities.

microsoft surface
Microsoft issues its dividends quarterly.


6. AT&T

  • 5-year average dividend yield: 8.22%
  • TTM dividend yield (as of September 10, 2023): 7.72%
  • Dividend frequency: Quarterly
  • Last dividend payment: $0.2775 on August 1, 2023

Telecommunication companies have large cash revenue streams for dividend payments due to cell phone services being essential. Because of this, telecommunications companies provide a fantastic choice for reliable dividend investment.

AT&T is one of the largest telecommunication companies in the world. In fact, the company is the 6th most valuable telecommunications company by market capitalization, with a market cap of $103.83 billion as of September 11, 2023. Its dividend yield is also among the highest compared to other communications companies.

AT&T is constantly evolving, having recently merged with Time Warner. In addition, the company has acquired DirecTV, resulting in an increase in its direct-to-consumer relationships.

AT&T has paid dividends for 34 consecutive years, and it looks like it will continue these payments. The company has a large cash flow, allowing it to continue paying dividends in the foreseeable future, even if its stock declines.

In addition, AT&T is expected to release a new streaming service that will increase its cash flow from its subscriber base. This will also increase its cash flow, making dividend payments a sure thing.

largest telecommunications companies
AT&T offers a TTM dividend yield of 7.72%.

©Jonathan Weiss/Shutterstock.com

7. Apple

  • 5-year average dividend yield: 0.74%
  • TTM dividend yield (as of September 10, 2023): 0.53%
  • Dividend frequency: Quarterly
  • Last dividend payment: $0.24 on August 17, 2023

Apple is the most valuable company in the world by market capitalization, with a market cap of $2.785 trillion as of September 10, 2023. This is no surprise as the company has a loyal global fanbase scrambling each year for the latest Apple product.

Amazon is currently the most valuable brand in the world, with a brand value of $299 billion, with Apple coming in a close second with a brand value of $297 billion. Customers love Apple’s products, as they are quality products that provide its users with a “status symbol.”

41.6% of Apple’s revenue comes from the Americas, while Europe has 24% of its revenue, and China has 20.8%. In its Q3 2023 financial report, Apple reported revenue of $81.8 billion, a decline of 1% YoY. In addition, the company boasts $62.58 billion cash on hand, further confirming its strong financial position.

Apple has been paying dividends since 1987. Being a leader in the tech industry, the company is a firm favorite for investors looking for the best tech stocks that pay a dividend.

personal computer companies
Apple has a 5-year average dividend yield of 0.74%.

©Drop of Light/Shutterstock.com

The Bottom Line

These best tech stocks that pay dividends should be on every investor’s radar. Dividends are ideal for generating additional income over the long term and are the perfect addition to one’s investment portfolio.

However, don’t put all your eggs in one basket. Ensure you diversify your portfolio with other types of stock.

Before making any financial investment, it’s important to do your research or speak to a financial advisor for advice.

The 7 Best Tech Stocks That Pay a Dividend FAQs (Frequently Asked Questions) 

Who is the most valuable company in the world?

Apple is the most valuable company in the world, with a market cap of $2.785 trillion on September 10, 2023.

What is a dividend?

A dividend is a distribution of profits by a company to its shareholders. It’s typically paid in the form of cash or additional shares of stock, providing investors with a portion of the company’s earnings as a return on their investment.

What is a tech stock?

A tech stock refers to a publicly traded company that operates within the technology sector. These companies are involved in various aspects of technology, such as developing software, manufacturing hardware, providing internet services, or engaging in other tech-related activities.

Are dividend stocks worth it?

Dividend stocks are a great way of diversifying your investment portfolio. These stocks can provide stability and additional income to investors.

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