#China #Beijing #share repurchase #Baidu #Dividend Policy

Baidu Implements a New Share Repurchase Program and Dividend Policy

Baidu, Inc. (NASDAQ: BIDU), a leader in artificial intelligence and internet services, has effectively revealed a proactive approach towards enhancing shareholder value through the announcement of a significant share repurchase initiative and the establishment of a dividend policy. This strategic move reflects Baidu's commitment to promoting investor confidence amid fluctuating market conditions.

Details of the Share Repurchase Program

The newly approved share repurchase program allows Baidu to buy back up to $5 billion worth of its own shares. This program is set to be operational through December 31, 2028, with periodic reviews by the Board of Directors that may allow for adjustments to the program's size and terms. By purchasing its own shares, Baidu aims to bolster its stock price by managing the supply of its shares in the market.

Goals and Rationale

To support this initiative, Baidu has pointed out its robust cash reserves and sound financial management as the foundation for generating long-term value for its shareholders. This repurchase program is not only about responding to short-term price changes; it underscores the company's dedication to solid, long-term growth and stability.

The methodology for executing the repurchase will include utilizing open market transactions at prevailing prices, as well as other legally compliant means. As market conditions change, the specific deployment of these funds will be guided by careful oversight from company management.

Introduction of a Dividend Policy

In tandem with the buyback initiative, Baidu is also introducing, for the first time, a formal dividend policy for its ordinary shares. This policy signifies an evolution in Baidu’s approach to shareholder returns, which may now include both regular and special dividend distributions.

Funding Sources for Dividends

Baidu plans to ensure that future dividend payouts are sustainable, primarily stemming from operational profits. Additionally, proceeds from the sale of non-core assets or other investment returns may bolster these distributions. The company aims to create a balanced policy that aligns its dividend approach with its overarching growth strategy while ensuring that shareholder returns remain a priority.

Looking Ahead

The company anticipates declaring its first dividend payment in 2026, with the timing and total amount remaining subject to the discretion of the Board. Factors influencing these decisions will include Baidu's financial performance, capital requirements, and prevailing market conditions.

In summary, this dual approach of implementing a share repurchase program alongside a new dividend policy indicates Baidu’s strategic commitment to enhancing shareholder value while maintaining a long-term growth perspective. This proactive stance may well position Baidu as a more appealing investment opportunity as it navigates future challenges in the tech landscape.

About Baidu

Founded in 2000, Baidu has continually worked to simplify the complexities of the digital world through cutting-edge technology, gaining recognition as a powerful player in the AI industry. Trading on NASDAQ under the symbol “BIDU,” Baidu underscores its commitment to innovation and growth with these latest developments.