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01/11 18:38
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Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
The earnings call reveals a robust financial performance with significant revenue and net income growth. The company has effectively expanded its market presence, particularly in Japan and Malaysia, and launched innovative AI and crypto products. Despite a slight increase in expenses, the overall financial health is strong, with impressive operating and net income margins. The positive sentiment is reinforced by optimistic guidance and strategic plans for further growth in key markets. The Q&A section highlights continued momentum and strategic initiatives, outweighing minor uncertainties regarding Hong Kong regulations.
Total funded accounts Approximately 2.9 million, representing a 41% increase year-over-year and an 8% rise quarter-over-quarter. The increase is attributed to international expansion and growth in markets like Singapore, the U.S., Malaysia, and Japan.
New funded accounts 204,000, up 32% from a year earlier. Growth driven by elevated market volatility, high-profile IPOs, and robust U.S. business performance.
Total client assets HKD 974 billion, up 68% year-over-year and 17% quarter-over-quarter. Growth due to robust net asset inflow and favorable mark-to-market depreciation from equities.
Margin financing and securities lending balance HKD 51.4 billion, stable. Initial deleveraging due to market downturn was followed by a recovery in risk appetite.
Total trading volume HKD 3.59 trillion, representing 121% year-over-year and 12% quarter-over-quarter growth. Growth driven by market volatility and increased cryptocurrency trading.
Wealth management client assets HKD 163.2 billion, up 104% year-over-year and 17% quarter-over-quarter. Growth supported by strengthened fixed income offerings and innovative products like tokenized money market funds.
IPO distribution and IR clients 517, up 15% year-over-year. Growth driven by increased deal volume and investor participation in the Hong Kong IPO market.
Total revenue HKD 5.3 billion, up 70% from HKD 3.1 billion in Q2 2024. Growth driven by higher trading volume and interest income.
Brokerage commission and handling charge income HKD 2.6 billion, an increase of 87% year-over-year and 12% quarter-over-quarter. Growth driven by higher trading volume, partially offset by a decline in blended commission rate.
Interest income HKD 2.3 billion, up 44% year-over-year and 11% quarter-over-quarter. Growth driven by higher income from security borrowing, lending business, and bank deposits.
Other income HKD 444 million, up 176% year-over-year and 41% quarter-over-quarter. Growth driven by higher fund distribution service income and currency exchange income.
Total costs HKD 671 million, an increase of 13% from HKD 574 million in Q2 2024. Increase driven by higher brokerage commission and handling charge expenses.
Gross profit HKD 4.6 billion, an increase of 82% from HKD 2.6 billion in Q2 2024. Growth due to strong revenue performance.
Operating expenses HKD 1.3 billion, up 21% year-over-year and 3% quarter-over-quarter. Increase driven by investments in AI capabilities and higher general and administrative headcount.
Income from operations HKD 3.3 billion, increased 126% year-over-year and 25% quarter-over-quarter. Growth due to strong top-line growth and operating leverage.
Net income HKD 2.6 billion, increased by 113% year-over-year and 20% quarter-over-quarter. Growth driven by strong revenue and operating margin expansion.
Cryptocurrency trading launch: Launched cryptocurrency trading in most U.S. states in June, enhancing the platform's value as a one-stop trading solution.
Futubull AI and moomoo AI: Rolled out moomoo AI across all international markets, building on the success of Futubull AI in Hong Kong, to provide smarter tools for efficient investing.
Principal protected structured products: Introduced principal protected structured products in Hong Kong, becoming the first online broker to offer such retail-facing products.
International expansion: Over 50% of funded accounts now come from clients outside of Futu Securities Hong Kong, with significant growth in Singapore, the U.S., Malaysia, Japan, Australia, and Canada.
U.S. market sponsorship: Became the official sponsor of the New York Mets, broadening brand reach in the U.S. and internationally.
Localized offerings in Malaysia and Japan: Introduced IPO financing services and a stock earnings calendar in Malaysia; hosted MooFest Japan in partnership with NASDAQ and Japan Exchange Group, attracting over 12,000 investors.
Client engagement and retention: Quarterly retention rate remained above 98%, reflecting high client loyalty and satisfaction.
Trading volume growth: Total trading volume reached HKD 3.59 trillion, up 121% year-over-year, driven by market volatility and renewed interest in cryptocurrency.
Wealth management growth: Wealth management client assets grew to HKD 163.2 billion, up 104% year-over-year, with strengthened fixed income offerings and tokenized money market funds.
IPO distribution leadership: Acted as joint book runners for multiple prominent listings in Hong Kong, attracting record subscriptions and partnering with 6 of the 10 largest IPOs by fundraising size in the first half of 2025.
AI investment: Increased R&D expenses by 18% year-over-year, focusing on AI capabilities to enhance platform offerings.
Market Volatility: Elevated market volatility stemming from trade tensions and trade talks in early April caused sharp downturns, impacting client deleveraging and trading activities.
Regulatory Risks: Forward-looking statements caution about inherent risks and uncertainties, including regulatory hurdles that could materially affect results.
Decline in Hong Kong Stock Trading Volume: Hong Kong stock trading volume contracted 9% quarter-over-quarter due to reduced interest in the technology sector, which could impact revenue from this market.
Margin Financing Risks: Lower margin financing income was noted due to a sequential decline in daily average margin financing balance, which could affect interest income.
Interest Expense Volatility: Interest expenses associated with security borrowing and lending business showed fluctuations, with a Q-over-Q decrease due to HIBOR rate decline, indicating sensitivity to interest rate changes.
Increased Operating Expenses: Operating expenses rose 21% year-over-year, driven by higher R&D investments, selling and marketing expenses, and general administrative costs, which could pressure profit margins.
International Expansion: The company aims to continue its international expansion, with Singapore, the U.S., Malaysia, and Japan identified as key growth markets. Australia and Canada are also showing robust growth momentum.
Cryptocurrency Trading: The company launched cryptocurrency trading in most U.S. states in June and plans to reinforce its position as a one-stop trading platform.
AI Tools: The company plans to expand the rollout of its AI tools, such as moomoo AI, across all international markets to enhance investor efficiency.
Wealth Management: The company is strengthening its fixed income offerings in Hong Kong and Singapore, including Hong Kong dollar and RMB-denominated bonds, floating rate bonds, and principal-protected structured products. It also plans to expand its digital asset offerings.
IPO Distribution: The company aims to leverage its strong retail distribution capabilities to participate in more high-profile IPOs, particularly in Hong Kong.
The selected topic was not discussed during the call.
The earnings call reveals strong financial performance with significant revenue and net income growth, supported by operating leverage. The Q&A highlights robust client asset inflows and healthy customer acquisition costs. Despite some uncertainties in interest income trends, the company's expansion in cryptocurrency, AI tools, and international markets, along with strategic investments like Airstar Bank, indicate positive momentum. Overall, the optimistic outlook and strategic initiatives suggest a positive stock price movement in the short term.
The earnings call reveals a robust financial performance with significant revenue and net income growth. The company has effectively expanded its market presence, particularly in Japan and Malaysia, and launched innovative AI and crypto products. Despite a slight increase in expenses, the overall financial health is strong, with impressive operating and net income margins. The positive sentiment is reinforced by optimistic guidance and strategic plans for further growth in key markets. The Q&A section highlights continued momentum and strategic initiatives, outweighing minor uncertainties regarding Hong Kong regulations.
The earnings call reveals strong financial performance with significant increases in net income, operating margin, and client acquisition. Despite concerns about a decrease in new accounts, the company remains confident in achieving its client growth targets. The positive outlook for asset inflows and expansion into new markets like New Zealand further boosts sentiment. However, uncertainties in crypto trading and management's evasive responses on certain issues slightly temper enthusiasm. Overall, the positive financial metrics and growth prospects outweigh the negatives, suggesting a positive stock price movement.
The earnings call indicates strong financial performance with significant revenue and net income growth, improved margins, and effective cost management. Despite some supply chain challenges and economic uncertainties, the company has maintained robust client acquisition and trading volume growth. The Q&A session reveals management's confidence in future growth and market expansion, especially in Hong Kong and Singapore. The lack of a share buyback program is a minor negative factor, but overall, the positive financial metrics and optimistic guidance outweigh the concerns, suggesting a positive stock price movement.
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