Intel Corp, the world’s largest chipmaker, added $10 billion to its stock-buyback plan to return money to shareholders as corporations’ spending on technology boosts its earnings.
The increase brings the total authorised for buybacks to $14.2 billion, Santa Clara, California-based Intel said on its website today.
Intel reported rising fourth-quarter sales and profit this month, helped by demand for server chips used in so-called cloud-computing centers, which provide computing over the web. At the time, Intel also forecast sales exceeding analysts’ predictions, a sign that corporate demand is compensating for the company’s delayed entry into the tablet-computer market.
“Across the tech sector, share repurchase is about the most attractive deployment of excess capital that companies can do,” William Nygren, a portfolio manager at Harris Associates LP’s Oakmark Funds, said in an interview. Harris owned almost 50 million Intel shares as of September 30, according to Bloomberg data. “From an incremental return basis, a buyback far exceeds what Intel can do with an acquisition.”
Intel added 12 cents to $20.94 at 10.21 am New York time in Nasdaq Stock Market trading. The shares climbed 3.1 per cent last year.
Intel also said it’ll pay a quarterly dividend of 18.12 cents, reflecting its previously announced 15 per cent increase from the fourth quarter. The company said it has spent about $70 billion in stock buybacks since 1990.
