Qfin Holdings Shares Drop Following Disappointing Q3 Earnings
Q3 Financial Performance: Qfin Holdings (QFIN) reported a significant Q3 loss, with non-GAAP earnings per American depository share (EPADS) of RMB 11.36, missing estimates and declining from previous quarters. Revenue was RMB 5.21B, slightly above consensus but down from the prior quarter.
Market Challenges: The company faced economic uncertainties and regulatory changes, leading to increased risk levels and a rise in loan delinquency rates, which reached 2.09% as of September 30, 2025.
Future Projections: Qfin anticipates a non-GAAP net income of RMB 1.0B-RMB 1.2B for Q4, reflecting a year-over-year decline of 39%-49%.
Operational Adjustments: CEO Haisheng Wu noted that the company is adjusting operations to navigate macroeconomic challenges and has tightened risk standards in response to liquidity issues in high-risk segments.
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Qfin Transitions from Fintech Star to Struggler Amid New Regulatory Changes
Weak Financial Performance: Qfin Holdings Inc. reported a 0.2% decline in revenue and a 17% drop in net profit for the third quarter, marking its first revenue contraction in over two years, and issued a bearish outlook for the remainder of the year.
Regulatory Challenges: The company faces increased regulatory scrutiny that is expected to impact its loan facilitation business, as new rules emphasize risk management and may limit loan growth.
Rising Default Risks: Qfin's provisions for bad loans surged due to an increase in delinquent loans, reflecting the broader economic challenges in China, where consumer and business borrowing has decreased.
Market Reaction: Following the disappointing quarterly results, Qfin's stock fell significantly, underperforming the market, as investors remain cautious due to the company's high exposure to regulatory and economic changes.
JP Morgan Adjusts Qfin Holdings Rating to Neutral and Reduces Price Target to $21
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