Just as important is the shape of the dividend recovery.  Some domestic companies continued to pay dividends during this period, while several commodity companies increased or reinstated dividends during the latest reporting season.

What’s more, this dividend improvement isn’t confined to the ASX – Plato’s data shows global payouts grew again last quarter, too. 
 

Gold and copper 

In Plato’s opinion, the gold sector, from a dividend perspective, stood out in the August reporting season. A couple of gold miners paid maiden dividends, and several established gold producers delivered dividend increases.

Copper companies also had increased dividend payouts, courtesy of the AI infrastructure build-out driving the copper price higher [copper is a key material in data centres].

Sandfire Resources (ASX: SFR)  reinstated its dividend. BHP (ASX:BHP) lifted its payout by 51% and Rio Tinto (ASX: RIO) lifted its by 30%.  

Copper now generates 54% of BHP’s earnings [1] – comfortably more than iron ore. The Big Australian is now, first and foremost, a copper company. In Plato’s opinion, that’s what funded BHP’s dividend increase.

Iron ore was the main resources disappointment. As of September this year, the iron ore price was down on 12 months ago. Fortescue (ASX: FMG) – the purest iron ore exposure among the majors – cut its dividend by 23%.

Lithium went the other way. With the commodity price up strongly over the year, Mineral Resources (ASX: MIN), IGO (ASX: IGO) and PLS (ASX: PLS) all reinstated dividends that were suspended a few years ago.
 

Banks

In Plato’s opinion, the Commonwealth Bank’s (ASX: CBA) FY26 earnings result looked fine in the rear-view mirror. Full-year profit was up 7%, the dividend rose 4%, and CBA’s margins were strong. But the problem may be what’s coming for the Australian banking sector.

Since the Federal Budget, banks have reported lower  mortgage application volumes. CBA’s mortgage application volumes have fallen around 15%. The other Big Four banks also experienced similar falls of between 12% to 20%. [2]

However, recent mortgage application data indicates a change in operating conditions for the Australian banking sector.

Plato considers lower mortgage application volumes to be one factor that may affect future bank earnings. The extent and timing of any impact remain uncertain.

Offshore, financials are a different story. 

The sector generated around 30% of all global dividend income in the most recent quarter – more than any other– according to Plato’s analysis.

European banks and insurers, including Allianz, AXA and UBS, lifted dividend payouts on the back of higher interest rates and strong balance sheets, while US banks have flagged dividend increases after a solid earnings season and a clean pass on their latest financial stress tests.
 

Consumer stocks

In Australia, the cost-of-living crisis is producing two very different consumers.

Any company exposed to housing had a rough earnings season, particularly from July onwards. 

The supermarkets, meanwhile, are having a better time. Coles (ASX: COL) and Woolworths (ASX: WOW) both grew profits by around 16% and lifted dividends by a similar amount. 

The squeeze on households isn’t uniquely Australian. Plato’s global developed-market data shows global dividend income from the consumer discretionary sector fell 20.9% over the quarter, with carmakers Stellantis and Porsche, along with Unilever, driving the decline.
 

Energy sector 

In Plato’s opinion, Ampol (ASX: ALD) was a dividend highlight in the latest reporting season: profit up roughly 370%, dividend up 363% on last year.

Recent high oil refining margins have boosted energy company profits and dividends, although it is uncertain how long these conditions will persist. But the forces behind them are real: Ukrainian strikes on Russian refineries, the Middle East conflict disrupting supply, and China exporting less refined product than it used to. 

It is the same case globally for energy majors. Worldwide, Plato’s data shows dividend income from the energy sector jumped 11.7% for the quarter, with ExxonMobil, Chevron and Shell all raising their payouts.
 

Global dividends

According to Plato’s data, companies around the world grew payouts by 5.6% on average in the most recent quarter versus the same quarter a year ago.

Beyond banks and energy, rising defence budgets supported dividend growth at Lockheed Martin, Thales and BAE Systems, while strong share prices and healthy cash flow allowed NVIDIA, Broadcom and ASML to lift their payouts.

The recent US earnings season underpins the outlook. It wasn’t just a story about a handful of mega-cap tech names; 10 or the eleven sectors reported year-on-year earnings growth, led by energy. About 86% of companies beat analyst estimates – well above the five-year average of 78%, according to Plato’s data and analysis.

US corporate earnings growth was the fastest since 2021, even after stripping out one-off gains at Alphabet and Amazon, according to Plato analysis.

AI is a theme to watch. It came up in more earnings calls in company results presentations than ever, but investors are starting to ask harder questions about whether all that spending will deliver revenue.
 

Dividend outlook

So, is there further dividend growth to come? Plato’s analysis and opinion on this question is set out below.

Plato tracks this with its proprietary models that estimate the probability of dividend cuts across both Australian and global markets.

At home, according to Plato’s dividend cut model, aggregated across the whole market, the dividend cut probability is currently sitting below its long-term average, as the chart below shows. 

At the date of the analysis, Plato's model produced an aggregate dividend-cut probability below the model's long-term average– which is consistent with the strong dividend increases in the August reporting season.