Meta, formerly known as Facebook, experienced a significant increase in its shares, surging over 20% after reporting a tripled profit in the fourth quarter and announcing its first-ever dividend. The company’s revenue for the quarter rose by 25%, reaching $40.1 billion, the fastest growth rate since mid-2021, indicating a rebound in the online advertising market. Net income also tripled, rising to $14 billion from $4.65 billion the previous year.

Investors responded positively to Meta’s decision to issue a dividend, which is considered a rare move for a high-growth technology company. The company will pay a quarterly dividend of 50 cents per share on March 26. Additionally, Meta announced a $50 billion share buyback.

The market cap of Meta increased by over $200 billion, surpassing a total valuation of $1.2 trillion. Investors praised the dividend announcement as a sign of the company’s maturity and a positive outcome of its efforts to become more efficient.

Meta CEO Mark Zuckerberg’s focus on making 2023 a “year of efficiency” seems to have paid off, with the company doubling its operating margin to 41%. The company’s cost-cutting measures, including significant job cuts and addressing challenges such as changes in the economic environment, Apple’s iOS updates, and rising interest rates, contributed to these positive financial results.

Despite heavy investments in the metaverse, which have incurred significant costs, Meta’s Reality Labs unit saw sales pass $1 billion in the fourth quarter. However, the virtual reality unit recorded losses of $4.65 billion.

Investors have also shown interest in Meta’s involvement in artificial intelligence (AI), particularly its LLaMA large language model, seen as a competitor to Microsoft-backed OpenAI’s GPT-4. Some analysts consider Meta a “closet AI winner,” expecting its AI capabilities to improve ad relevance for users and better serve advertisers.