(Reuters) -Uber Technologies said on Wednesday it would buy back up to $7 billion worth of company shares for the first time ever following a strong recovery in ride-share and healthy demand at its food delivery business.
The company’s shares rose nearly 6% to $72.95 in trading before the bell.
“Today’s authorization of our first-ever share repurchase program is a vote of confidence in the company’s strong financial momentum,” Uber CFO Prashanth Mahendra-Rajah said.
Over the next three years the ride-hailing firm expects gross bookings growth in the mid to high teens percentage and adjusted core profit growth in the high 30s to 40%.
Free cash flow as a percentage of adjusted earnings before interest, taxes, depreciation and amortization is expected to be 90% or higher annually, the company said.
Following a slump during the pandemic, the ride-share market expanded sharply as people stepped out more and employees were called back to offices. That helped Uber more than double its market value last year.
The ride-hailing firm posted its first annual net profit last week since the company went public in 2019. Uber had a free cash flow of $3.4 billion in 2023, up from $390 million a year earlier.
Earlier this month, Meta Platforms declared its first dividend days ahead of social network Facebook’s 20th anniversary.
(Reporting by Yuvraj Malik and Samrhitha Arunasalam in Bengaluru; Editing by Shounak Dasgupta)
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