As part of the tech company’s quarterly earnings statement on Tuesday, Alphabet’s (parent company of Google) board approved plans for a 20-for-1 stock split. Following the news, the stock of Alphabet rose by more than 9% after market.
Recall that Apple split its stock in the past year and a half, giving each shareholder three shares for each of their shares. The market capitalizations of Apple and Alphabet are among the few that reached trillions of dollars, as investors go for profitable growth.
According to the earnings statement, Alphabet intends to split its Class A, Class B, and Class C shares. Shareholders will need to approve the change. For each share of the same class of stock owned by each shareholder at the close of business on July 1, they will receive 19 additional shares on July 15.
Class C shares were added to Google’s stock in 2012, but they do not carry voting rights. Founders and early investors already held Class A shares, which carry one vote each, and Class B shares, which carry 10 votes each. Throughout its 2015 rebrand to Alphabet, the company maintained its stock structure.