Samsung Electronics has reported its first year-on-year profit growth in two years, with the announcement of an ?11.3 trillion (£6.45bn) share buyback by the company driving shares even higher in after-hours trading.

The share buyback is Samsungs biggest to date, and Samsung has announced that it will cancel all shares purchased back from investors through the scheme, and that the firm plans to give shareholders 30 to 50 per cent of its free cash flow over the next three years, mostly in the form of dividends.

According to industry analysts, the buyback is mainly aimed at defending the stock price of the firm, which has seen its core smartphone business shrink as it loses market share to rivals like Apple, Huawei and Xiaomi.

The firms revenue growth in Q3 was largely driven by strong component sales, and saw earnings up 8.9 per cent from the same period last year, to ?51.7 trillion. Operating profit was up an impressive 82 per cent year-on-year, to ?7.4 trillion, in line with guidance.

The release of the Galaxy Note 5 and several lower-end models did see the mobile division also post its first year-on-year profits in two years, up 37 per cent to ?2.4 trillion. However, the firms chip division was the top earner for the fifth quarter in a row.