Futu Holdings Repurchases $160 Million in Stock Amid Pressure

Online brokerage Futu Holdings Ltd. repurchased $160 million of its American Depositary Shares, according to a filing on 25 May 2026. The accelerated buyback program was executed as Futu’s stock faced significant downward pressure, underperforming major indices. The move represents a major deployment of capital to support the share price and signal board confidence to investors. Futu’s NASDAQ-listed shares have retreated over 20% year-to-date, undercutting the performance of its primary competitor, UP Fintech Holding Ltd.

Context — [why this matters now]

Share repurchases are a common tool for management to return capital and signal undervaluation, particularly during periods of market stress. Futu’s last significant buyback authorization was a $500 million program announced in May 2025, of which approximately $340 million remained available prior to this transaction. The current buyback coincides with intensified regulatory scrutiny from Chinese authorities on offshore-listed firms and slowing client asset growth in the Hong Kong market.

The broader macro backdrop for Chinese ADRs remains challenging. The Nasdaq Golden Dragon China Index has declined 12% over the past quarter, pressured by geopolitical tensions and domestic economic data. Futu’s specific catalyst for this accelerated repurchase appears to be a swift 15% correction in its stock price over the preceding two weeks. This drop followed weaker-than-expected quarterly earnings that highlighted compressed margins.

Data — [what the numbers show]

The $160 million repurchase was executed at an average price range between $48.50 and $52.75 per ADS. This represents approximately 3.05 million shares, or 1.8% of Futu’s total outstanding shares. The company’s market capitalization stands near $8.5 billion following the buyback. Futu’s current price-to-earnings ratio of 18.5 is a discount to its historical 3-year average of 24.3.

Metric	Pre-Buyback	Post-Buyback
Shares Outstanding	~169.5 million	~166.4 million
Buyback Authorization Remaining	~$340 million	~$180 million

Futu’s total client assets reached $145 billion in its last report, a 9% year-over-year increase that decelerated from the 22% growth rate seen a year prior. This compares to UP Fintech’s client assets of $98 billion, which grew 14% year-over-year. The buyback program consumed approximately 12% of Futu’s total cash and cash equivalents, which were reported at $1.32 billion.

Analysis — [what it means for markets / sectors / tickers]

The immediate market effect is a technical support level for Futu’s share price, potentially creating a floor around the $50 mark. Secondary beneficiaries include other financially strong Chinese tech firms with large cash balances, such as Tencent Holdings Ltd. and Alibaba Group Holding Ltd., as the buyback demonstrates a viable path to shareholder returns amid regulatory ambiguity. Brokerage sector peer UP Fintech may face pressure to initiate a similar capital return program to remain competitive for investor attention.

A key counter-argument is that deploying capital for buybacks could limit Futu’s ability to manage potential regulatory changes or invest in growth initiatives. If client acquisition costs continue to rise, the reduction in cash reserves could become a liability. Trading flow data from the past week indicates short interest in Futu has increased to 5.2% of float, suggesting a segment of the market remains skeptical about the sustainability of the buyback’s positive impact. Long positioning is concentrated among institutional investors betting on a mean reversion trade.

Outlook — [what to watch next]

Investors should monitor Futu’s next quarterly earnings report, scheduled for 15 August 2026, for updated guidance on client growth and any further buyback announcements. The key technical level to watch is the 50-day moving average, currently at $54.20; a sustained break above this resistance would signal a potential reversal of the bearish trend.

Regulatory developments from the China Securities Regulatory Commission regarding cross-border listing rules, expected by late Q3 2026, will be a critical catalyst for the entire ADR sector. Should the company’s share price fall below the $48.50 buyback level, it would invalidate the confidence signal and likely trigger further selling pressure. Market participants will also watch for any changes in the ownership stake of Futu’s largest shareholder, Tencent, which currently holds a 28.5% interest.

Frequently Asked Questions

How does Futu's buyback compare to Alibaba's repurchase program?

Futu’s $160 million buyback is significantly smaller in absolute terms but larger relative to its market cap compared to Alibaba’s program. Alibaba has an ongoing $25 billion repurchase authorization, but it represents a smaller percentage of its vast market capitalization. Futu’s buyback is more aggressive on a per-share basis, aiming for a immediate impact on its stock price, whereas Alibaba’s is a multi-year buffer against volatility.

What is the tax implication of a buyback for FUTU shareholders?

For US investors holding Futu ADRs, the buyback is treated as a sale of shares. Shareholders who tendered their shares directly to the buyback will realize a capital gain or loss based on their original purchase price. Those who did not participate see an indirect benefit through a higher percentage ownership of the company and potentially higher earnings per share, which is not a taxable event until shares are sold.

Does Futu have a history of successful buybacks?

Futu has completed several smaller buybacks since its 2019 IPO. Its most comparable transaction was a $75 million repurchase in Q4 2023, which coincided with a 25% share price appreciation over the following quarter. However, past performance is not indicative of future results, and the current macro environment for Chinese tech is markedly more challenging than in 2023, with higher interest rates and slower economic growth.

Bottom Line

Futu’s capital return gamble must overcome sector-wide headwinds to reward shareholders.

Disclaimer: This article is for informational purposes only and does not constitute investment advice. CFD trading carries high risk of capital loss.