(Reuters) – Trading app Robinhood (NASDAQ:) Markets said on Tuesday it would buy back up to $1 billion of shares over two to three years, starting in the third quarter.
The company is introducing new products such as a credit card for its premium subscribers as it strives to become a full-fledged financial services company.
It has also benefited from positive sentiment among retail clients, who are diving back into stock trading in hopes of a soft landing for the economy.
Companies often buy back shares when they believe they are undervalued or when they see limited opportunities to drive financial growth by reinvesting their profits.
Its shares rose nearly 6% after the bell and are up 61% this year.