Investing.com -- Shares of Western Digital Corp. (NASDAQ: WDC ) climbed 4% after the company announced the authorization of a new $2.0 billion share repurchase program, signaling confidence in its long-term business prospects.

The newly authorized repurchase program by the Western Digital Board of Directors is set to take effect immediately, with the possibility of acquiring shares on the open market or through privately negotiated transactions. The company may also utilize a Rule 10b5-1 plan to execute the buybacks. This strategic move comes on the heels of Western Digital’s recent initiation of a quarterly dividend, further emphasizing its commitment to returning value to shareholders.

Western Digital’s CEO, Irving Tan, expressed the company’s optimism about its future, citing the strength of its product portfolio and the anticipated enduring value of the business. "The share repurchase program underscores our strong confidence in Western Digital’s future, the depth of our product portfolio, and the long-term value we see in our business," said Tan. He also referred to the company’s shareholder-friendly capital allocation strategy, which was outlined on Investor Day and includes reinvesting in the business, reducing debt, and returning capital to shareholders.

The timing and exact amount of the share repurchases will depend on market conditions and other corporate considerations, and Western Digital reserves the right to suspend or discontinue the program at any time.

Today’s rise in Western Digital’s stock price reflects investor enthusiasm following the announcement, as the market responds to the company’s proactive approach to capital management. The repurchase program is a clear indication that Western Digital is prioritizing shareholder value and has the financial flexibility to support such a significant buyback initiative.

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