Amazon Announces 20-for-1 Stock Split and $10 Billion Share Buyback Program

[Image source=AP Yonhap News]

[Asia Economy Reporter Jeong Hyunjin] Amid major tech companies like Apple and Tesla recently conducting stock splits one after another, Amazon joined the trend on the 9th (local time) by deciding on a stock split and a large-scale share repurchase.

According to CNBC and other broadcasts, Amazon's board of directors approved a 20-for-1 stock split, dividing existing shares into 20, and a $10 billion (approximately 12.4 trillion KRW) share repurchase. The stock split will be approved at the shareholders' meeting on May 25 and the split shares will begin trading on the market from June 6. This is Amazon's third stock split since its IPO in 1997 and the first in 23 years since the dot-com bubble in 1999.

A stock split divides existing shares at a certain ratio, which does not change the intrinsic value of the company but lowers the price per share, making it easier for investors to access the stock and generally leading to a rise in stock price. Following the news of Amazon's stock split and share repurchase, its stock price rose nearly 7% in after-hours trading. In regular trading, it closed at $2,785.58, up 2.40% from the previous day, and later surpassed $2,980.

Previously, Apple, Tesla, and Alphabet also executed stock splits. Alphabet announced a 20-for-1 stock split in February, and Apple and Tesla announced 4-for-1 and 5-for-1 stock splits respectively in 2020. Subsequently, their stock prices soared.

This content was produced with the assistance of AI translation services.