A stock buyback, also known as a share repurchase, is when a company uses cash to buy back its own shares on the open market. This process reduces the number of shares outstanding, which can increase the companys earnings per share and potentially boost the share price. The company can either retire the repurchased shares or keep them as treasury stock, available for re-issuance.

There are several reasons why a company may choose to buy back its own shares. One reason is to return money to shareholders that it doesnt need to fund operations or other investments. Another reason is to consolidate ownership and preserve stock prices. Additionally, a company may want to influence its share price in the market.

Share buybacks can be beneficial for shareholders, as they can increase shareholder value and potentially generate a profit if the company later issues the shares at a lower price. However, buybacks can also backfire if not used correctly.

Overall, a stock buyback is a way for a company to re-acquire its own shares and potentially increase shareholder value.