In this article, we will discuss the best dividend stocks in the tech sector.
There was a time when tech stocks drew investor interest purely for their growth potential. But more recently, they’ve been gaining attention for a different reason: dividends. This marks a major shift, given that tech companies have traditionally focused their resources on innovation and expansion. Today, a significant portion of the tech sector consists of established firms with solid business models, healthy margins, steady growth, strong financials, and manageable debt levels. According to S&P, about 39% of tech companies in the Composite 1500 index are now returning capital to shareholders through dividends—a notable jump from 28% back in 2013.
In addition, technology stocks have emerged as a major contributor to the market’s overall dividend payouts. FactSet data showed that tech companies now account for around 13% of the total dollar value of dividends within the S&P Composite Index. That puts the tech sector just behind financials, making it the second-largest source of dividends in the index—with a strong chance of taking the top spot in the near future.
What’s more surprising is that tech companies haven’t just begun distributing dividends—they’ve also seen a select group consistently raise their payouts year after year. This group includes some of the world’s most prominent and successful names, alongside major global consulting firms, credit card providers, and other tech-adjacent players. Over the past several years, dividend growth from the technology sector has outpaced that of the broader market. Data from S&P Dow Jones Indices showed that tech companies within the S&P Composite more than doubled their total dividend payouts by 2023 compared to 2013. This growth ranks as the fourth highest among all sectors and significantly surpasses the Index’s overall dividend increase of 7.2% during the same timeframe. With tech’s current dividend payout ratio at just 39%, there appears to be considerable room for further expansion.
The move by leading tech firms to start paying dividends has sparked discussions around finding the right balance between capital appreciation and income generation. Sam Witherow, who manages the JPM Global Equity Income fund, noted that although his fund has traditionally included a mix of dividend-paying companies and those focused on capital growth, the characteristics of some of these companies are now evolving. He made the following comment about these strategies:
“We are seeking to provide clients with both a yield premium to the market and a dividend growth premium to the market at the aggregate portfolio level. It’s the combination of the two characteristics that typically leads to the best risk-adjusted returns. To deliver this we have always looked to have diversified exposure across global industries including traditionally growthier industries like consumer discretionary or tech.”
Sam Buckingham, an investment manager at Abrdn Portfolio Solutions, pointed out that growth stocks offering smaller dividends could be useful for income funds aiming to diversify across different sectors and investment factors. He explained that while these stocks typically start with lower yields, they often have the potential for dividend growth over time. When paired with more traditional income stocks—like those in the utilities sector that offer higher initial payouts but slower growth—they can help create a more balanced portfolio. Given this, we will take a look at some of the best dividend stocks in the tech sector.
Our Methodology
For this list, we scanned the holdings of the S&P Information Technology index, which tracks the performance of major tech companies. From there, we identified companies that pay dividends to shareholders and picked 13 companies with the highest number of hedge fund investors, as per Insider Monkey’s Q4 2024 database. The stocks are ranked according to the number of hedge funds having stakes in them.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
13. Skyworks Solutions, Inc. (NASDAQ:SWKS)
Number of Hedge Fund Holders: 31
Skyworks Solutions, Inc. (NASDAQ:SWKS) is an American semiconductor company, headquartered in California. The company is playing a key role in advancing the wireless networking revolution. It stands as a prominent developer, manufacturer, and supplier of analog and mixed-signal semiconductor products and solutions, serving a wide range of applications.
In the first quarter of 2025, Skyworks Solutions, Inc. (NASDAQ:SWKS) reported revenue of $1.07 billion, which fell by over 11% from the same period last year. However, the revenue beat analysts’ estimates by $1.76 million. The company secured 5G content for high-end Android smartphones from brands such as Samsung Galaxy, Xiaomi, and Asus. It also played a role in supporting Gemtek’s introduction of the first AI router, which features a voice-enabled, AI-powered healthcare service.
Skyworks Solutions, Inc. (NASDAQ:SWKS)’s cash position also remained strong. The company generated $377 million in operating cash flow, and its free cash flow came in at $338 million. The operating cash flow represented 35% of its margin, and the free cash flow accounted for 32% of its margin. The company currently offers a quarterly dividend of $0.70 per share, having raised it by 2.9% in July 2024. This marked its 10th consecutive year of dividend growth, which makes SWKS one of the best dividend stocks in the tech sector. The stock has a dividend yield of 5.2%, as of April 10.
12. Roper Technologies, Inc. (NASDAQ:ROP)
Number of Hedge Fund Holders: 54
Roper Technologies, Inc. (NASDAQ:ROP) is a Florida-based broadly diversified technology firm that manages a portfolio of 28 businesses, each of which leads within its specific niche. These businesses are organized under three main segments: application software, network software, and technology-enabled products.
Although Roper Technologies, Inc. (NASDAQ:ROP) is clearly recognized as a tech company today, it didn’t start out that way. In its early years, the company was rooted in the industrial sector, producing items like home appliances, pumps, and other industrial equipment. Over the past two decades, the company has steadily moved away from its capital-heavy and cyclical industrial operations by selling off most of those businesses. Today, its focus is on acquiring high-margin, asset-light technology and software firms that generate steady, recurring revenue.
Roper Technologies, Inc. (NASDAQ:ROP) posted solid results for the fourth quarter of 2025, with revenue reaching $1.88 billion, which showed a 16.3% increase compared to the same period a year earlier. Adjusted net earnings rose 10% to $520 million. As part of its strategic growth plan, the company invested $3.6 billion in acquiring top-tier vertical software firms. Among the notable additions were Procare Solutions, a key player in early childhood education software, and Transact Campus, which was successfully merged with the CBORD division focused on education and healthcare software.
On March 7, Roper Technologies, Inc. (NASDAQ:ROP) declared a quarterly dividend of $0.825 per share, which was in line with its previous dividend. Overall, the company has been rewarding shareholders with growing dividends for the past 33 years, which makes it one of the best dividend stocks on our list. The stock supports a dividend yield of 0.60%, as of April 10.
11. International Business Machines Corporation (NYSE:IBM)
Number of Hedge Fund Holders: 60
Commonly known as Big Blue, International Business Machines Corporation (NYSE:IBM) is an American multinational tech company. On March 18, the company revealed a new partnership with NVIDIA aimed at enhancing the power and accessibility of AI for businesses. The collaboration involves integrating NVIDIA’s AI Data Platform into IBM’s hybrid cloud infrastructure, enabling companies to better handle their data and scale AI operations more effectively. IBM Consulting will also support this initiative by helping businesses automate workflows with NVIDIA’s AI technologies.
International Business Machines Corporation (NYSE:IBM)’s quantum computing segment has seen notable growth in recent years. Since 2017, its IBM Quantum offerings have brought in close to $1 billion in cumulative revenue—highlighting the early success of its strategy, which combines advanced superconducting qubit hardware, hybrid-cloud capabilities, and the open-source Qiskit software toolkit. The company plans to continue developing this area with a roadmap focused on improving error correction and system fidelity in the years ahead.
In terms of financial performance, International Business Machines Corporation (NYSE:IBM) delivered strong cash results in 2024, generating $13.4 billion in operating cash flow and $12.7 billion in free cash flow. During the fourth quarter, it returned $1.5 billion to shareholders through dividends. Currently, it offers a quarterly dividend of $1.67 per share and has a dividend yield of 2.91%, as of April 10. The company has been rewarding shareholders with growing dividends for the past 29 consecutive years.
