On 10 June 2026 Microsoft announced a dividend of $0.91 per share. A dividend is a cash payment a company makes to its shareholders. A share is one small slice of ownership in the company. Whether a person received the $0.91 depended on one date, 20 August 2026.
That date is the ex-dividend date: the first day a buyer no longer gets the company's next dividend. This guide explains the four dates of a dividend, who receives the payment and why the share price falls on the ex-dividend date. The rules described are United States rules, as of 2026. The example is a past dividend, paid on 10 September 2026.
What is the ex-dividend date? The ex-dividend date is the first day on which buying a share no longer entitles the buyer to the company's next dividend. A buyer on or after that day does not receive the dividend. The seller keeps it.
A dividend has four dates. The declaration date is when the company announces it. The ex-dividend date is the cut-off for buyers. The record date is when the company checks its list of shareholders. The payment date is when the cash is sent.
On average, the share price falls by about the dividend on the ex-dividend date, because buyers from that day no longer receive it.
In the United States, as of 2026, a trade completes (settles) one business day after it is made. The ex-dividend date and the record date are therefore usually the same day.
What are the four dates of a dividend?
Every dividend has four dates. Microsoft's press release of 10 June 2026 states all of them. Chart 1 shows them.
Source: Microsoft press release of 10 June 2026; YX Insights
The declaration date is the day the company's board announces the dividend, its size and the other three dates. Microsoft's was 10 June 2026.
The ex-dividend date is the first day a buyer no longer receives the dividend. The record date is the day the company checks its list of shareholders. Microsoft's ex-dividend date and record date were both 20 August 2026.
The payment date, also called the payable date, is the day the cash is sent. Microsoft's was 10 September 2026.
The ex-dividend date came 71 days after the declaration. The payment came 21 days after the ex-dividend date. The idea of a dividend is covered in what is a dividend.
Who receives the dividend and who does not?
Only the day of the trade matters. A buyer whose purchase happens before the ex-dividend date receives the dividend. A buyer on or after that date does not. The seller keeps it.
Take Microsoft's dividend. A purchase on 19 August 2026 received $0.91 per share, so 100 shares paid $91.00 on 10 September. A purchase on 20 August received nothing.
A holder who bought on 19 August and sold on 20 August still received the dividend, because the purchase came before the ex-dividend date. The day that counts is the day of the trade, not the day it settles. The basics of owning a share are in what is a stock.
A share's price reflects what the company is worth to its owners, including cash it is about to pay out. Before the ex-dividend date, a buyer gets that cash. From the ex-dividend date, a buyer does not, so the price adjusts down by about the dividend.
The holder owns the same company. The dividend is owed to the holder on the payment date. The price fall is the part of the company's value that is leaving as cash.
What does the price do on the ex-dividend date in real data?
A single day cannot show the effect. Microsoft's closing price, the price of the last trade of the day, was $484.31 on 19 August 2026. The $0.91 dividend is 0.19% of that price.
The close on 20 August was $481.15, a fall of 0.65%. On the same day SPY (the S&P 500 ETF), a fund that tracks an index of large US companies, fell 0.84%. The market's move was larger than the dividend.
Chart 2 therefore uses many ex-dividend dates. It uses funds because 22 of them supply 2,102 ex-dividend dates, far more than one company can. A fund is a pooled investment that holds many shares or bonds and passes their dividends on to its holders. Each dot is one fund.
Source: YX Insights
The horizontal axis is the average dividend as a % of the previous day's close. The vertical axis is the average change in the closing price on the ex-dividend date. The dashed line marks a price fall equal to the dividend.
Most dots sit near the line. A few sit above it, meaning the price fell by less than the dividend.
Across all 2,102 dates the closing price changed by −0.43% on average, against an average dividend of 0.47%. On other days, meaning every day that was not an ex-dividend date for the same funds, the average change was +0.04%. Adding the dividend back to the ex-dividend dates leaves +0.04%, the same as an ordinary day.
The closing price fell on 67% of ex-dividend dates. The test uses the closing price as quoted on the day. The adjusted close, which adds dividends back, would hide the fall.
Why do the ex-dividend date and the record date sit where they do?
Settlement is the official transfer of the shares to the buyer and the cash to the seller. It happens a set number of business days after the trade. A business day is a weekday on which the market is open.
The record date list holds only owners whose purchases have settled. A purchase must settle by the record date to count. With three business days to settle, the last day to buy with the dividend was three business days before the record date. The ex-dividend date was therefore two business days before the record date.
Source: Microsoft investor relations dividend history; YX Insights
Chart 3 shows this in Microsoft's own dates. The US settlement cycle was three business days until 5 September 2017. It was two until 28 May 2024. As of 2026 it is one.
For 53 dividends up to August 2017 the ex-dividend date fell two business days before the record date. For the next 27 it fell one business day before. For the 9 from August 2024 to August 2026 it fell on the same day.
The rule is the settlement time minus one business day. Under the one-day cycle, Financial Industry Regulatory Authority (FINRA) Rule 11140 sets the ex-dividend date on the record date when the record date is a business day. The New York Stock Exchange states the same, except in specified cases.
One exception matters. For a dividend of 25% or more of the share's value, the ex-dividend date is deferred to one business day after the payment date.
How is the ex-dividend date used in tax rules?
This section is general information, not tax advice. It reflects Internal Revenue Service (IRS) Publication 550 (2025), read on 14 October 2026.
The IRS defines a category called qualified dividends. To count, the holder must have held the stock for more than 60 days in the 121-day period that begins 60 days before the ex-dividend date. The wider picture is in how are dividends taxed.
In short, the dividend goes to the buyers of the share before the ex-dividend date. On average the price falls by about the dividend on that date, because buyers from then on no longer receive it.
Common questions about the ex-dividend date
What does ex-dividend mean in simple terms?
Ex-dividend means the share trades without the right to the next dividend. A buyer on or after the ex-dividend date does not receive that dividend, because the seller keeps it. The company pays the dividend to holders who bought the share before that date.
Do you get the dividend if you buy on the ex-dividend date?
No, a buyer on the ex-dividend date does not receive that dividend. The buyer must purchase the share on the business day before the ex-dividend date or earlier. A holder who buys one day before and sells on the ex-dividend date still receives the payment.
No. On average the dividend lowers the price by about its amount, but market moves can outweigh it. In 2,102 ex-dividend dates across 22 funds, the closing price fell on 67%. The average change was −0.43%, against an average dividend of 0.47%.
What is the difference between the record date and the ex-dividend date?
The record date is the day the company checks its list of shareholders. The ex-dividend date is the first day a buyer is not on that list in time. In the United States, as of 2026, the two usually fall on the same day. Before 28 May 2024 the ex-dividend date came earlier.
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