O'Leary dismissed the notion that Google needs to spend money in certain categories, such as video content, rather than giving it to investors.  "When you have a culture of just spending and trust—in other words, don't worry about it, everything I put my money into is going to provide a great return to shareholders—that story always ends in tragedy," he said.  Read More Lightning Round: Right time to buy Google?  Instead, O'Leary believes Google needs to strike a balance. It must deliver great growth by picking the right opportunities and exercise discipline and realize that 70 percent of returns come from dividends over the long term, he said.  Apple has come to that conclusion and investors now see it as a good buy because the company is growing and innovating while paying shareholders a dividend, he added.  "That's how you provide stability. That's how you provide overall long-term performance. And you have less volatility. Who wants a 20 percent loss in Google in six months?" O'Leary asked. "I don't want that. I don't want that stock. They've got to show me respect and some cash back, and they've got to do it now."  Read More Why money-losing Box is finally ready for IPO  He also called Amazon.com a bad buy, saying the buzz drummed up by the company's announcement that Woody Allen will write and direct a series for its studio has nothing to do with the investment thesis.  "If you have to use the words 'buzz' and 'cache' to entice consumers and investors into the stock, I think that's bad," he said. "I like the words 'cash flow after capital expenditures,' 'low price earning ratios' and 'compounded cash growth quarter to quarter.' That's sexy to me. I get excited about that," O'Leary said.
Google should stop investing in "wow factor ideas" that don't make money and issue a dividend, Kevin O'Leary said.