The big surprise in Meta Platforms' (NASDAQ: META) fourth-quarter earnings report last week was the initiation of the social media giant's first-ever dividend. Meta will pay $0.50 per share to shareholders of record on Feb. 22. On an annualized basis, that works out to a dividend yield of about 0.5%.

This dividend yield will likely grow over time as Meta boosts its payout, although share buybacks are still a big part of the equation. Along with the dividend announcement, Meta disclosed that an additional $50 billion had been allocated for share buybacks. Meta poured nearly $20 billion into buying back its own stock in 2023; the dividend will eat up just over $5 billion over the next year if it remains at its current level.

For dividend investors, Meta is a tough sell. There's plenty of room to grow the dividend over time; Meta reported a net income of $39 billion and a free cash flow of $44 billion for 2023. However, share buybacks appear to be the priority. If Meta takes the same path as Apple, which has been paying a dividend for a decade but still sports a dividend yield of around 0.5%, the dividend will never be all that consequential.

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Source Fool.com