Jul. 22 at 11:35 AM
$WRD
Response to the Buyback Criticism (Part 1)
Over the past few weeks, a vocal critic has published a series of daily rants criticising WeRide’s management and strategy.
Investors should absolutely challenge management. That’s healthy. However, many of these conclusions overlook how an AV business actually works and develops. Rather than debating opinions, I’d rather look at the facts.
The criticism is straightforward. WeRide was still loss-making, generated less than
$100 million in annual revenue, spent about
$95 million on share repurchases, and the stock has since traded below the average buyback price. Those facts are correct.
The conclusion however is very short sighted.
A buyback should not be judged after 4 months. It is a long-term capital allocation decision.
More importantly, autonomous driving is not a business where every extra dollar immediately translates into faster growth. Commercial deployments often take years to negotiate, validate, regulate and scale.
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