LexinFintech Q2 Earnings Call Highlights
LexinFintech reported weaker financial results in Q2, with loan volume declining 4.3% sequentially to CNY55.4 billion and revenue falling by 21.1% year-over-year to CNY1.3 billion. Net income dropped sharply by 49.7%, reaching just CNY101 million due to tighter funding conditions in the sector following risk events at industry peers. Credit costs rose significantly, increasing by 9.6% sequentially to CNY1.4 billion as delinquency metrics worsened and management expects further deterioration into Q3. The company anticipates a net loss for the quarter partly driven by restructuring expenses. In response, Lexin is shifting toward technology-driven services and e-commerce solutions, which accounted for 45% of loan volume in Q2. The firm also announced cost-cutting measures, increased use of AI technologies, and plans to assess dividends annually instead of semiannually to preserve liquidity. Despite the challenges, management remains on a white list with major funding providers and holds CNY2.5 billion in cash as it awaits market recovery.
Tickers: $LX
Topics: credit risk funding constraints loan volume net income drop revenue decline