X Financial Reports Q2 2026 Earnings with Sharp Revenue Declines and Improved Credit Metrics
X Financial (XYF) reported a significant decline in key financial metrics for its second quarter of fiscal year 2026, driven by reduced loan origination activity as the company prioritized credit quality over volume. Total Loan Facilitated and Originated dropped to RMB 11.63 billion, down 70.2% from a year ago, while Total Outstanding Loan Balance fell 61.5%. Despite these declines, X Financial improved its delinquency rates in the short-term (31-60 days) due to better underwriting standards. The company's operating margin increased to 19.6%, up from 12.0% in Q1 2026, as it reduced costs and credit-related provisions by over one-third year-over-year. Guarantee Income rose sharply (up 119.3%) due to revenue recognition on its guaranteed loan portfolio. However, Net Income fell 91.1%, though Non-GAAP Adjusted Net Income increased significantly from the prior quarter. X Financial also announced a cash dividend of $0.28 per ADS and repurchased approximately 2.63 million shares in early 2026.
Topics: credit quality focus delinquency rates loan origination revenue decline