Best Buy, the top U.S. consumer electronics retailer, saw its shares rise 2 percent in early trading.
The plan comes after Best Buy reported quarterly earnings last week that missed analysts' estimates by a wide margin and gave a disappointing full-year forecast as television sales cooled.
In a statement, Chief Executive Brad Anderson said that Best Buy sees "so much opportunity for customer growth," particularly in the United States.
The Minneapolis-based company said the number of stores in the United States and Canada could approach 1,800, up from its prior plan to have 1,400. It currently has 1,035 Best Buy, Future Shop and Pacific Sales stores in those markets.
Best Buy also said it remained committed to expanding in China with the Five Star and Best Buy brands.
Best Buy also said it would retire its existing $200 million credit facility and replace it with a committed $2 billion five-year revolving credit facility.
The $5.5 billion buyback plan, which terminates and replaces a $1.5 billion repurchase program announced on June 21, 2006, should have a modest benefit on fiscal 2008 earnings per share, Best Buy said.
The company said it would use part of the new repurchase program to execute an accelerated share repurchase program to buy back $3 billion of common stock no later than February 2008. It plans to fund the $3 billion of repurchases through cash, short-term investments and interim borrowing.
Goldman Sachs Group
Best Buy said most of the impact of the accelerated share repurchase program would be included in its share count by the end of July.
The board intends in October to increase the quarterly cash dividend to 13 cents per share from 10 cents. Best Buy paid its first cash dividend in December 2003 and has raised it annually since then.
The new total planned store count assumes 1,400 U.S. Best Buy superstores, up from a previous projection of 1,000 and 852 currently operating.
The new plan would also increase the number of Canadian Best Buy and Future Shop stores to at least 200 from 169 currently operating and the number of U.S. Pacific Sales stores to up to 200 from 14.
Shares of Best Buy were up 71 cents, or 1.6 percent, at $45.70 after rising as high as $45.90 in morning trading on the New York Stock Exchange.
The company said last week that it expected demand and profit to gain steam later this year, fueled by mobile phones, music players and high-definition TVs.