OneConnect Financial Technology (6638) Q1 2025 earnings summary

Executive summary

• Revenue from continuing operations fell 49.2% year-over-year to RMB368 million, mainly due to the strategic phasing out of cloud services and lower demand for implementation and risk management solutions.

• Gross margin declined to 28.5% from 37.7% year-over-year, reflecting reduced economies of scale.

• Loss from continuing operations attributable to shareholders narrowed to RMB38 million from RMB54 million year-over-year.

• The company completed the disposal of its virtual bank business in April 2024, with historical results now reflected as discontinued operations.

Financial highlights

• Revenue from Ping An Group and Lufax dropped 67.2% year-over-year, while third-party customer revenue declined 13.6%.

• Gross profit from continuing operations was RMB105 million, down from RMB272 million year-over-year.

• Operating loss from continuing operations was RMB56 million, compared to RMB66 million in the prior year.

• Net cash used in operating activities was RMB190 million; net cash used in investing activities was RMB825 million.

Outlook and guidance

• Management highlighted ongoing risks and uncertainties, including regulatory changes, customer concentration, and the need to maintain technology leadership.