Dilution
When a company creates new shares, for example to raise money or pay employees.
Each existing share then owns a smaller slice. A company can grow its total sales while each share’s slice of sales grows much more slowly.
Examples from real companies
- Tesla (TSLA): Tesla’s share count rose about 119% from 2012 to 2025. That dilution means each share owns a smaller slice of the company.
- Palantir Technologies (PLTR): Palantir Technologies’s share count rose about 372% from 2018 to 2025. That dilution means each share owns a smaller slice of the company.
- Snowflake (SNOW): Snowflake’s share count rose about 784% from 2019 to 2026. That dilution means each share owns a smaller slice of the company.
More investing words
Profit per share (EPS)P/E ratioBook value per shareFree cash flowCapital spending (capex)DividendDividend yieldPayout ratioShare buybackRevenue (sales)Profit marginDebtMarket capitalization10-K and 10-Q reportsStock split
For education only, not investment advice.