There Is Now a Way to Collect 6.25% From Google. It Stops Paying in 2029

Alphabet (NASDAQ:GOOG | GOOG Price Prediction, NASDAQ:GOOGL) has spent most of its history offering income investors almost nothing. The common stock pays a token quarterly dividend of $0.22 per share, and buybacks did the heavy lifting until this year, when the company suspended the buyback program in Q2 2026.

Things changed on June 2, when Alphabet priced what it called the largest equity capital raise in US corporate history to fund its AI infrastructure buildout. Inside that raise sat something Google had never issued before: a listed income security. Two series of mandatory convertible preferred stock now trade on the Nasdaq as Alphabet Series A Mandatory Convertible Preferred (NASDAQ: GOOGM) and Series C Mandatory Convertible Preferred (NASDAQ: GOOGN). Each carries a 6.25% annual rate on a $1,000 liquidation preference, pays quarterly, and converts automatically into common stock around May 15, 2029. Most GOOGL shareholders are unaware that the instrument exists.

How the 6.25% Actually Reaches You

A depositary share, which is what a retail investor buys under the GOOGM ticker, represents one-twentieth of a preferred share. The declared quarterly cash dividend of $12.15 per preferred share amounts to $0.60 per depositary share, with the most recent payment sent on August 15, 2026, to holders of record on August 1. The 6.25% figure is the coupon on par; the running yield to a buyer depends on the purchase price. GOOGM closed at $49.03 on August 14, 2026, which means a buyer at market receives a running yield that can be above or below the stated coupon, depending on the purchase price.

The 10-year Treasury yields 4.63%, so the stated coupon sits well above the risk-free rate. That is a real spread on a large-cap AI leader whose Q2 2026 revenue grew 24.23% to $119.80 billion and whose Google Cloud segment grew 82% to $24.77 billion. The catch is that this income stream has a hard expiration date. It stops in 2029, when the security converts.

The Conversion Cap Is the Whole Argument

A mandatory convertible behaves differently from a standard preferred. At maturity, the holder receives Alphabet common shares, delivered in a variable number determined by a formula that moves inversely with the stock price within a defined band. Above the upper threshold, the holder participates in only part of further gains, because the conversion rate shrinks as the stock rises. Below the lower threshold, the holder absorbs the full decline, share for share. That structure is the coupon price.

GOOGL is up 70.93% over the past year and traded at $344 on August 17, 2026. A buyer of GOOGM today is trading part of Alphabet’s future upside for three years of stated income at 6.25% on par. The instrument suits income investors who want defined Alphabet exposure with a coupon and are willing to accept capped participation.

Investors whose thesis rests on uncapped AI upside will find the common stock a better fit. If you believe Sundar Pichai when he said, “Our AI investments are redefining what’s possible across every part of our business,” the common stock is the cleaner expression of that view. GOOGM is for the investor who wants the yield and will accept the ceiling written into the contract.

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