VNET announces $50 million share repurchase program

BEIJING - VNET Group, Inc. (NASDAQ:VNET), a carrier- and cloud-neutral internet data center services provider in China with a market capitalization of $1.59 billion, announced Friday that its Board of Directors has authorized a share repurchase program of up to $50 million of its American depositary shares (ADSs). The announcement comes as the company’s stock has shown strong momentum, gaining over 180% in the past year according to InvestingPro data.

The company plans to use existing funds to finance the repurchases, which may be executed through open-market transactions, privately negotiated deals, or block trades, depending on market conditions and in accordance with applicable regulations. InvestingPro analysis indicates the company operates with a debt-to-equity ratio of 3.88 and maintains a current ratio of 1.1, factors investors should consider when evaluating the buyback program.

Under the program, each ADS represents six Class A ordinary shares of the company. The repurchase plan will become effective upon signing a formal agreement with qualified broker-dealers and will run for 12 months.

The timing and conditions of share repurchases will follow requirements under Rule 10b-18 and Rule 10b5-1 of the Securities Exchange Act of 1934. The company’s Board will periodically review the program and may adjust its terms or size, or suspend or discontinue it entirely.

VNET noted that the program does not obligate the company to acquire any specific number of ADSs. Any repurchased shares may be held as treasury shares or canceled.

The company currently operates in more than 30 Chinese cities, serving over 7,000 hosting and enterprise customers across various industries including internet companies, government entities, and businesses of all sizes. With annual revenue of $1.19 billion and a prominent position in the IT Services industry, VNET continues to expand its market presence. For deeper insights into VNET’s financial health and growth prospects, investors can access comprehensive analysis through InvestingPro’s detailed research reports.

This announcement was made in a press release statement from the company.

In other recent news, VNET Group Inc has announced its first-quarter 2025 financial results, revealing an 18% year-over-year revenue increase to Rmb2.25 billion. The company’s adjusted EBITDA rose by 26% to Rmb682 million, surpassing consensus estimates and demonstrating a robust financial performance. Additionally, VNET Group’s management has confirmed its full-year 2025 guidance, expecting revenues between Rmb9.1 billion and Rmb9.3 billion, and adjusted EBITDA between Rmb2.70 billion and Rmb2.76 billion. The company also anticipates generating Rmb2 billion in capital from a Real Estate Investment Trusts (REITs) project during the fiscal year 2025.

In terms of analyst perspectives, BofA Securities has adjusted its price target for VNET Group to $11.30, down from $13.80, while maintaining a Buy rating. This adjustment reflects a recent sector de-rating influenced by an AI chip ban, though the firm cites VNET’s strong growth trajectory. Similarly, Jefferies has reduced its price target for VNET to $15.81 from $20.94, but also maintains a Buy rating. Jefferies highlights the company’s impressive 87% year-over-year growth in wholesale revenue as a key driver of its financial outperformance. Both firms continue to view VNET Group positively, supported by strong demand for its services and a rapid expansion of its wholesale business.

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