Facebook Inc (FB) Prefers Growth Over Dividend

Facebook Inc (NASDAQ:FB) has not planned a dividend payout for its shareholders anytime, in the near future. This is so, because Facebook sees itself as a company that has a lot of potential for growth and would want to invest more cash in the growth efforts that it is undertakings for expanding the sales.

“We take very seriously the work we do to ensure we invest every dollar wisely,” Chief Financial Officer David Ebersman said at Facebook’s annual shareholder meeting today in Redwood City,California. “At this time our focus really is on using the cash we have to invest in growing the business, so we don’t pay a dividend and don’t anticipate doing so in the near future.”

Areas where Facebook plans to invest its money

The California based company plans of returning higher value to the shareholders with a growth in the size of the business than what they will gain if company chooses to make cash payments in the form of dividends.

Facebook Inc (NASDAQ:FB) is the world’s biggest social network, whose revenue grew at a phenomenal rate of 55% last year. This has boosted the company’s confidence, and it is now striving to achieve even better results. The company has plans for investment in the creation of the new mobile applications as the mobile platform is gaining huge popularity among users. It is, also, investing in making its advertising business a better and more popular one as it is a source of huge revenues for the company and has lots of potential, which is not yet tapped by the company. It, also, aims at increasing the Internet connectivity across the world.

WhatsApp Inc., the hugely popular messaging application with over half a billion users, has been acquired by Facebook for a whopping $19 billion in February 2014. Facebook Inc (NASDAQ:FB) is, also, trying to enter the wearable devices arena with the acquisition of Oculus VR Inc, who is a maker of virtual-reality glasses for gaming. This will be the first-ever hardware deal for social network giant, which will cost it around $2 billion, and is expected to support the company’s growth as wearable devices arena is growing at a fast rate.