LexinFintech Enjoys Growth Thanks to Influx of Users; Raises Outlook for 2019
Consumer finance platform LexinFintech reported two-digit revenue growth in the second quarter and raised its income guidance for the third quarter, sending its stock 4 percent higher intraday Friday, to $10.20 per share.
The Shenzhen-based company said its total revenue reached $363.1 million in the three months through June, up 22 percent year-over-year. However, its net income narrowed to $91.5 million, or 50 cents per American depositary share, representing a decrease of 5 percent from a year ago, according to the report.
LexinFintech Holdings Ltd. (Nasdaq: LX) attributed the soaring of online direct sales and revenue for financial services in the second quarter to the upsurge in the number of active users, which hit 4.1 million in June.
“In spite of the changes in the industry, we continue to grow at a rapid pace, thanks to our strong funding pipeline, highly compliant operations, and advanced financial technology,” Wenjie Xiao, the chief executive officer of LexinFintech, said in a statement today.
Its total loan originations in the second quarter reached $3.7 billion, at an increase of 57 percent from $2.4 billion in the second quarter of 2018, according to the report.
The lending platform also boosted its full-year 2019 estimate for loan originations. Lexin said it expects loan originations in the amount of 115 billion yuan ($16.4 billion) compared with its previous guidance of between 90 billion and 100 billion yuan.
“Thanks to our strong institutional funding, we're now able to raise our loan origination guidance for the year,” Yan Zeng, the chief financial officer of LexinFintech, said in the statement.
Among Lexin’s institutional funding partners are some of China's major banks including Industrial and Commercial Bank of China Ltd., Agricultural Bank of China Ltd., Bank of China Ltd., China Construction Bank Corporation and others.
“Our total number of institutional funding partners continues to grow, and we have more than sufficient funding from our institutional funding partners to meet our loan facilitation targets for the year,” Lexin's CEO Xiao said.
Over the past year, Beijing has implemented a series of regulatory changes in China's lending industry, seeking to reduce debt bubbles, control risks and constrain the dubious, scattered businesses prone to conceal fraud.
“Our efforts to continuously stay ahead of the regulatory curve and maintain our strong growth in spite of changing regulatory conditions are now paying off,” Zeng said in the report today.