News Corp.'s stock increased sharply Thursday, after the company reported upbeat quarterly earnings and investors latched on to management's commitment to return cash to shareholders through future stock buybacks.

The gain restored much of the billions of dollars in market value that News Corp. had lost since a phone-hacking scandal in Britain exploded in early July.

By Thursday afternoon, News Corp.'s stock was up $2.56 at $16.27. That's nearly 19 percent above Wednesday's closing price of $13.71, but it's still short of the $18.13 price on July 5, the day before new revelations of phone hacking at a tabloid owned by News Corp. The company closed the tabloid, News of the World, last month. Twelve people have been arrested as a probe continues.

After the stock market closed on Wednesday, News Corp. reported adjusted earnings of 35 cents per share in the quarter that ended in June, beating the 30 cents expected by analysts polled by FactSet. The company also beat forecasts in reporting that revenue grew 11 percent to $8.96 billion, driven by big gains at its cable TV channels such as Fox News.

Analysts were particularly excited about a new plan to expand an existing share buyback plan if shares remain depressed. News Corp. already has committed to buying back $5 billion in stock over the next 12 months.

Morgan Stanley analyst Benjamin Swinburne said in a research note that if News Corp. follows through on its plan, shareholders would get back by June 2014 the majority of the company's $20 billion in excess cash.

Share buybacks concentrate profits among fewer shares, making them more valuable.

News Corp. ended the quarter with $12.7 billion in cash. It had been saving up to buy the 61 percent of British Sky Broadcasting it didn't already own, but dropped the bid amid the uproar over phone hacking.

Management also vowed to put new acquisition targets through a rigorous vetting process in order to keep the price tag of each at around $1 billion or less and require annual returns on invested capital of about 15 percent. That addressed investor concerns that Rupert Murdoch, who controls the company through a family trust, is an empire-builder who squanders company cash on poor investments.