Qfin Holdings (QFIN) Q2 2024 earnings summary

Executive summary

• Achieved highest quarterly profit in 11 quarters, with Q2 2024 net revenue of RMB4,160 million, up 6.3% year-over-year, and non-GAAP net income of RMB1,413 million, up 23.3%, despite macroeconomic challenges.

• Platform empowered 160 financial institutions and served over 53 million users with approved credit lines cumulatively.

• Business model upgraded to a platform approach, with non-credit risk bearing loans accounting for nearly 65% of total volume and improved operational efficiency.

• Management highlighted improved efficiency, lower funding costs, and enhanced asset returns.

• Board changes included the resignation of Chairman Zhou Hongyi and appointment of Fan Zhao as new chairman.

Financial highlights

• Q2 2024 revenue increased 6.3% year-over-year to RMB4,160 million; non-GAAP net income rose 23.3% to RMB1,413 million; non-GAAP net income per diluted ADS up 32% to RMB9.16.

• ROE reached 25.4% in Q2, outperforming industry peers.

• Funding costs decreased by 56 basis points sequentially and 132 basis points in the first half.

• Cash and cash equivalents stood at RMB8.5 billion at quarter end.

• Loan facilitation volume reached RMB95.4 billion in Q2, up from RMB57.8 billion a year ago.

Outlook and guidance

• Q3 2024 non-GAAP net income expected between RMB1.55–1.65 billion, up 31–40% year-over-year.

• Loan volume anticipated to grow in the second half of 2024, supported by stable demand, improved risk metrics, and diversified acquisition channels.

• Take rate expected to stabilize at 4–4.5% long-term.

• Medium-term plans include strategic investment in AI and LLM technologies to improve efficiency.

• Long-term goal to empower digital transformation of financial institutions with advanced tech solutions.