Broadcom has announced a stock buyback program worth $12 billion.
The scheme, approved by the board of directors, will allow the tech giant to buy back up to $12 billion of its common stock, Broadcom said on Thursday.
Approval for the program lasts until 3 November 2019, the end of Broadcom's 2019 fiscal year.
Share repurchases may be made through a number of different measures, including open market purchases or private negotiations, depending on price, market conditions, and "alternative investment opportunities," the company added.
However, Broadcom has also emphasized that there is no guarantee on the number of shares to be purchased, or how long the program will run.
"The initiation of a stock repurchase program enhances our capital allocation strategy and provides us with a complementary tool to deliver value to our shareholders," said Tom Krause, Broadcom's Chief Financial Officer. "We are maintaining our policy of delivering 50 percent of trailing 12-month free cash flow to shareholders in the form of dividends while adding the ability to use the balance of our free cash flow not only for acquisitions but also for opportunistic buybacks."
The news sent shares up by 4.5 percent to $249.50 in extended trading on Thursday. At the time of writing, Broadcom shares are trading at $239.
Previously co-headquartered in Singapore and California, Broadcom has now relocated and San Jose, California, is now the company's sole headquarters.
President Trump barred the company from acquiring Qualcomm earlier this year, citing national security concerns relating to Broadcom's business relationships in China.
In March, Broadcom posted solid Q1 2018 results with non-GAAP earnings of $5.12 on revenue of $5.33 billion.