- U.S. dividend growth slows significantly in Q2 2025 with a net increase of $7.4 billion.
- S&P 500 Q2 2025 dividend payments increase 6.6% from the previous year, reaching $19.48 per share.
- Despite slowed growth, a 6% dividend increase is projected for 2025, setting a potential record.
The latest report from S&P Dow Jones Indices indicates a marked slowdown in U.S. dividend growth for Q2 2025. The net indicated dividend payment increased by $7.4 billion, a significant reduction from the $15.3 billion rise in Q1 2025, and $16.0 billion in Q2 2024. This trend reflects a cautious approach by companies amidst economic uncertainties, particularly concerning tariffs and their potential economic impact.
Specifically, the S&P 500 experienced a modest 0.6% increase in quarterly dividend payments, with payouts reaching $19.48 per share. This represents a 6.6% year-over-year increase. A notable 80.9% of companies within the S&P 500 are currently distributing dividends.
While the growth has slowed, projections for 2025 remain optimistic. The full-year dividend payments are expected to rise by 6%, down from the previously anticipated 8%, but still poised to set new records. This forecast is bolstered by the anticipated increase in dividends from major banks in Q3, following positive stress test results.
Dividend yields showed variability across market caps in Q2 2025, with large-cap yields decreasing to 1.25%, mid-cap yields to 1.50%, and small-cap yields to 1.70%. The decreases are attributed to stock price increases outpacing dividend growth.
