Brazilian Tech Firm LWSA Pairs New Dividend with Fifth Share Buyback Program

Locaweb Serviços de Internet S.A., one of Brazil’s leading digital commerce and software-as-a-service (SaaS) providers, announced on Monday that its board has approved a R$23.4 million dividend payment alongside its fifth and largest-to-date share buyback program. The combined capital return plan signals significant financial confidence from the management of the São Paulo-based technology company.

The newly approved dividend equates to R$0.0425 per common share. The ex-dividend date—the cutoff for shareholders to qualify for the payment—is set for Wednesday, August 19, with the actual payment scheduled for August 31. Simultaneously, the board authorized a new buyback program to repurchase up to 50 million common shares over the next 18 months, running until February 2028. For foreign investors, Locaweb (LWSA) is a major player in the Brazilian digital economy, offering a wide ecosystem of tools, including e-commerce platforms, hosting, and enterprise resource planning (ERP) solutions, serving businesses from small startups to large retailers.

The goal of the share repurchase is to maximize shareholder value by optimizing the company's capital structure. Locaweb plans to use the acquired shares for potential cancellation, which would reduce the total number of shares outstanding, or as currency for future merger and acquisition (M&A) activities. The buyback program is further amplified by a separate board resolution to cancel 18.6 million existing shares held in treasury, a figure that represents 3.3% of the company's total capital, effectively reducing the float right away. This reduction, coupled with the new program to buy back up to 50 million more shares, strongly indicates an active capital management strategy focused on efficiency and potentially boosting earnings per share.

The commitment to both a dividend payout and a large share buyback comes as the technology sector in Brazil, which has faced headwinds from high interest rates and market volatility, looks to demonstrate stability and a clear path to profitability. The dual action reinforces a management perspective that the company’s capital is best deployed in returning value to shareholders and maintaining flexibility for strategic growth initiatives.

What it touches LWSA common shares (LWSA3) are listed exclusively on the B3 stock exchange in São Paulo, which is the primary domestic market for its investors. The company operates in the broad technology sector, which includes listed Brazilian firms such as PagSeguro Digital (PAGS) and Inter & Co. (INTR) that also maintain listings on U.S. exchanges.