Q1 2025 UP Fintech Holding Ltd Earnings Call
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Unknown Executive: Ladies and gentlemen, thank you for standing by and welcome to the UP Fintech Holding Ltd first quarter 2025 earnings conference call. At this time, all participants are in listen-only mode. There will be a presentation followed by the question and answer session.
Speaker Change: Ladies and gentlemen, thank you for standing by and welcome to the up Fintech holding Limited's first quarter 'twenty 'twenty earnings Conference call. At this time, all participants are in listen only mode.
Speaker Change: That will be a presentation followed by the question and answer session. I must advise you that this conference is being recorded today Lisa T. At 2025, I would now like to hand, the conference over to first speaker today, Mr. Lee the head of Investor Relations. Thank you. Please go ahead.
Unknown Executive: I must advise you that this conference is being recorded today, May 30th, 2025.
Aron Lee: I would now like to hand the conference over to our first speaker today, Mr. Aron Lee, the Head of Investor Relations. Thank you. Please go ahead.
Aron Lee: Thank you on ADR. Hello, everyone, and thank you for joining us for the call today. UP Fintech Holding Ltd's first quarter 2025 earnings release was distributed earlier today, and it's available on our IR website at ir.bytigerup.com, as well as Globe Newsware services.
Speaker Change: Thank you and area.
Mr. Lee: Hello, everyone and thank you for doing the call today.
Mr. Lee: Accordion Limited's fourth quarter 2025 earnings release was distributed.
Mr. Lee: Year to date and is available on our IR website at IR <unk> com.
Mr. Lee: Look using our services.
Unknown Executive: On the call today from UP Fintech, Mr. Wu Tianhua, Chairman and Chief Executive Officer, Mr. Zhang Zeng, Chief Financial Officer, Mr. Huang Lei, CEO of US Tech Securities, and Mr. Kenny Zhao, our Financial Controller.
Speaker Change: On the call today from a pretax amidst the Odeon, Bob Chairman and Chief Executive Officer, Mr. Johnson, Chief Financial Officer, Mr. Huang Lei CEO of U S Tiger Securities Mr. Kenny job, our financial controller.
Unknown Executive: Mr. Wu will give an overview of our business operations and discuss corporate highlights. We will then discuss our financial results. They will both be available to answer your questions during the Q&A session that follows the remarks.
Speaker Change: Mr. <unk> will give an overview of our purpose its operations and discuss corporate highlights.
Mr. Tony: Mr. Tony will then discuss our financial results.
Mr. Tony: Both be available to answer your questions during the Q&A session that follows their remarks.
Unknown Executive: Now let me cover the safe harbor. The statements we are about to make contain forward-looking statements. Within the meaning of the U.S. Private Security Federation Reform Act of 1995, a number of factors could cause actual results to differ materially from those containing any forward-looking For more information visit www.fintech.com For more information about factors that could cause actual results to materially differ from those in the forelooking statements, please refer to our Form 6K Burnished today, May 30th, 2025. And our annual report on Form 20F filed on April 23rd, 2025. We undertake no obligation to update any forworking statement except as required under applicable law.
Mr. Tony: Now, let me cover the Safe Harbor.
Mr. Tony: The statements were about to make content forward looking statements within the meaning of the U S. Private Securities Litigation Reform Act.
Mr. Tony: Alright.
Mr. Tony: Number of factors could cause actual results to differ materially from those company any forward looking statement.
Mr. Tony: For more information about factors that could cause actual results to materially differ from those in the forward looking statements.
Mr. Tony: These reports our form 6K furnished today may 13 2025.
Mr. Tony: Annual report on form 20-F filed on April.
Mr. Tony: April 24 2025.
Mr. Tony: Undertakes no obligation to update any forward looking statement, except as required under applicable law.
Aron Lee: It is my pleasure to now introduce our Chairman and Chief Executive Officer, Mr. Wu. Mr. Wu will make remarks in Chinese, which will be followed by an English translation.
Speaker Change: It is my pleasure to now introduce our chairman and Chief Executive Officer.
Speaker Change: With that we will make remarks in Chinese which will be followed by an English translation.
Tianhua Wu: Mr. Wu, please go ahead with your remarks.
Speaker Change: Mr. <unk>. Please go ahead with your remarks.
Speaker Change: Okay.
Tianhua Wu: Hello, everyone.
Tianhua Wu: Thank you for coming to the first report conference of Dow Jones International in 2025. Hello everyone, thank you for joining the Tiger Brokers first quarter 2025 earnings conference. In the first quarter, the company's gross annual income reached $1.2 billion, and the annual sales amounted to $600,000, an increase of 55.3%. During this period, the overall fluctuation in the Hong Kong U.S. stock market intensified, but maintained a high level of return. The company's turnover reached $21.75 billion.
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Speaker Change: Hello, everyone. Thank you for joining the Tiger brokers first quarter 2005 earnings conference call.
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Tianhua Wu: Promoted cash-in-the-box revenue to double Reaching $58.3 million Re-setting a new record At the same time, at the end of the first quarter Face-to-face sales increased to $5.2 billion Revenues increased by 89.4% Reaching $5,380,000 in the first quarter Revenues increased by 22.7% At the end of the first quarter Revenues increased by 22.7% Revenues increased by 22.7% Revenues increased by 24.7% Revenue gain in the second quarter Revenues increased by 24.7% Revenue in the second quarter Revenues increased by 26.3% Revenues increased by 26.7% GAAP net profit reached $30420, and the return increased by 8.4%, and the share price increased by 146.9% The first quarter's net profit and net profit margin are both at a record high.
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Tianhua Wu: The ability to improve net profit will continue to expand our business scale in the future, increase market investment, and provide more sufficient security and flexibility. In the first quarter, our total revenue reached US$122.6 million, up 55.3% year-over-year. Despite heightened volatility in the Hong Kong and U.S. markets, trading activity remains strong. As a result, total trading volume reached $217 billion, driving commission income to a record high of $58.3 million. more than doubling year-over-year. In addition, market financing and securities lending balance increased to 5.2 billion U.S. dollars, increased 89.4% year-over-year, net interest income reached 53.8 million U.S.
Speaker Change: Because you put out your way more judge hung Sionko rule Corona concerns about dumping invoicing.
Speaker Change: In the first quarter, our total revenue reached $122 6 million U S dollar up 55, 3% year over year.
Speaker Change: <unk> heightened the productivity in the Hong Kong and the U S market.
Speaker Change: Activity remains strong as ever.
Speaker Change: Without total trading volume reached 217 billion U S. Dollar grabbing commission income to a record high of $58 3 million U S dollar more than doubling year over year.
Speaker Change: In addition, marketing financing and securities lending balance increased to $5 2 billion U S. Dollar increased 89, 4% year over year net interest income reached $53 8 million U S. Dollar increased 22, 7% year over year.
Tianhua Wu: dollars, increased 22.7% year-over-year.
Tianhua Wu: Our bottom line, continued growth in our user base and rising R2 driven by product diversification have helped us further leverage fixed operation costs, leading to stronger, more sustainable profitability. Non-Gap Net Income Attributable to UP Fintech increased to $36 million, reflecting an 18.3% sequential increase and a 145% increase year-over-year. Gap net income attributed to UP Fintech reached $30.4 million USD, up 8.4% QoQ, and 146.7% year-over-year.
Speaker Change: Our bottom line continued growth in our user base and the writing Arco driven by part that diversification.
Speaker Change: I'll have to ask about their leverage fixed operational cost leader.
Speaker Change: Leading to stronger worked with tenable profitability.
Speaker Change: non-GAAP net income attributable to <unk> increased to 36 million U S dollar, reflecting an 18, 3% sequential increase and a 145% increase year over year.
Speaker Change: GAAP net income attributable to obtain tax rates of 34 million U S dollar up eight 4% quarter over quarter, and 146, 7% year over year.
Tianhua Wu: Both net income and profit margin set record high, and this continued improvement in earnings quality gives us greater flexibility to pursue strategic initiatives and further accelerate long-term growth. 60,900 new users have been added to the first quarter More than 40% have achieved the goal of 50,000 new users by the end of the year Huanbi increased by 2.9%, and Tongbi increased by 111.2%. Since the end of the first quarter, the number of registered users has reached 1,152,900 which is a 23.5% increase compared to the beginning of the year In terms of customer nature, the net inflow has remained strong The first quarter net inflow has reached $3.4 billion The main contribution comes from the retail users in Singapore and the Greater Zhonghua Region Diga's market is on the rise, bringing a net profit of about $7.8 billion The number of customers has set a record high, reaching $45.9 billion The return has increased by 9.9%, and the share price has increased by 39.5% and has achieved a growth of 10 consecutive quarters Of them, for clients in Central China, 20% of estimated real estate stakes have been recovered by visiting Huanbi Group.
Speaker Change: Both net income and profit marketing set record high.
Speaker Change: And this continued improvement in the earnings quality.
Speaker Change: With greater flexibility to pursue strategic initiative and further accelerate long term growth.
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Tianhua Wu: In the first quarter, the number of new users from Hong Kong has exceeded 30,000 US dollars. This means that we have gradually gained the trust and trust of local users by using high-quality products and services in the Hong Kong retail market. Hong Kong has also become one of the key strategic markets for the company since it went to Singapore. In the first quarter, we added 60,900 new funded accounts, which accounts for over 40% of our total target of acquiring at least 150,000 new funded accounts. And representing a 2.9% increase quarter over quarter and a strong 111.2% growth year over year.
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Speaker Change: In the first quarter, we're adding 60900, new Panda cow.
Speaker Change: To account for over 40% of arc for the target.
Byron: Byron 50000, new accounts.
Speaker Change: All right.
Speaker Change: Representing a two 9% increase quarter over quarter, and a strong 111, 2% growth year over year.
Tianhua Wu: The total number of funded accounts reached 1,152,900 at the end of the first quarter. increase of 23.5% year-over-year. In terms of client assets, net inflow remains strong, reaching US$3.4 billion for the quarter. Driven primarily by retail clients in Singapore and Greater China regions. Combined with approximately US$780 million in market gains, total client assets reached a record high of US$45.9 billion. UP 9.9% Code Recorder and 39.5% UOP. marking our 10th consecutive quarter of growth. In addition, gain access from the greater China region increased by over 20% quota per quarter. Also, we are encouraged to see the average net effect inflow of newly acquired clients from the Hong Kong market in the first quarter exceeded $30,000.
Speaker Change: The total number of funded accounts reached 1 million 152900 end of the first quarter.
Speaker Change: <unk> of 23, 5% year over year.
Speaker Change: In terms of client asset net inflow remains strong reaching $3 4 billion U S dollar for the quarter.
Speaker Change: Driven primarily by client by retail clients in Singapore, and our greater China region.
Speaker Change: Combined with approximately $780 million in mark to market gain.
Speaker Change: Total client assets reached a record high of 45 9 billion U S dollar.
Speaker Change: Up nine 9% Goldberg water and 39, 5% year over year.
Speaker Change: Marking our 10th consecutive quarter of growth.
Speaker Change: In addition.
Speaker Change: Aside from the greater China region increased by over 20% quarter over quarter.
Speaker Change: Also we are encouraged to see the average net asset inflow of newly acquired client from the Hong Kong market in the first quarter exceeded 30000 U S dollar.
Tianhua Wu: Demonstrating the growing trust and engagement built in the market during the two years after entering.
Speaker Change: Demonstrating the growing trust and engagement appeal in the market during the two year Andrew.
Tianhua Wu: Following the success in Singapore, Hong Kong has become a key strategic market where we are investing further to deepen our presence. In the first quarter, Lao Lao International continues to optimize product features and constantly improve user experience. In terms of artificial intelligence, the company has officially upgraded Tiger GPT to Tiger AI in the first quarter. This upgrade not only has the original single-model interface extended to a dual-model structure, but also, according to the actual user needs, has added the ability to access user self-selected shares and data. It can provide a more personalized AI analysis based on user self-selection.
Speaker Change: Following the success in Singapore, Hong Kong has become a key strategic market whereby our interest.
Speaker Change: We are investing further to deepen our presence.
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Tianhua Wu: After the upgrade, the user satisfaction of Tiger AI exceeded 80%. In terms of virtual asset business, Tiger Hong Kong has obtained the SSE license after completing the upgrade of the No. 1 card, and can now provide virtual asset transactions, deposits and withdrawals services to retailers and professional investors. This is not only an account that covers a wide variety of transactions, but also promotes the integration of traditional investment clients and encrypted asset investors, maintaining the vitality of progress, and providing a foundation. In terms of Hong Kong stock business, we have recently launched the functions of Equity Ripple and DVP in Hong Kong, which significantly improves the efficiency of Hong Kong stock market business and the ability to serve high-level clients.
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Tianhua Wu: In the first quarter, we continue to enhance our product offerings and improve user experience. On the AI front, we officially upgraded Tiger GPT to Tiger AI, marking a significant step forward in the personalization and intelligence www.fintech.com The upgrade expanded our AI capability from a single model to a dual model architecture. and introduced new features that allow integration with users watchlist and portfolio data. This allows Tiger AI to deliver more personalized and relevant investment. Following the upgrade, user satisfaction with Tiger AI exceeded 80%. As for crypto, following Type 1 license uplift, Tiger Brokers Hong Kong has now received approval from the Hong Kong SFC to offer virtual asset trading, deposit and withdrawal services to both retail and professional investors.
Speaker Change: Okay.
Speaker Change: In the first quarter, we continued to enhance our product offerings in the parochial here at spirit.
Speaker Change: Brett will officially upgraded Tiger GBT to Tiger AI, marking a significant step forward in the personalization and intelligence.
Speaker Change: The upgrade expanded our AI capability from a single model to a dealer model architecture.
Speaker Change: And introduce new feature that allows integration with users watched live and portfolio of data. This.
Speaker Change: This allows tiger AI to deliver more personalized and relevant investment inside.
Speaker Change: Following the upgrade user satisfaction with Tiger AI exceeded 80%.
Speaker Change: I put crypto following headquarter lessons uplift Tiger brokers Hong Kong has now received approval from the Hong Kong SFC to offer a virtual asset trading deposit and restore services to both retail and professional investor base.
Tianhua Wu: This means not only can we support multi asset classes within a single account, but also building greater synergy between traditional investors and digital asset holders. Laying the groundwork for increased market participation and vice-versa. In addition, we recently launched the equity repo and delivery versus payment features, significantly improving the efficiency of our stock borrowing and lending operations and strengthening our service capability for institution and high net worth clients.
Speaker Change: This means not only can they support multi asset classes within a single account, while also building greater synergy between traditional investors and these two coders.
Speaker Change: Laying the groundwork for increased market participation and widespread activity.
Speaker Change: In addition.
Speaker Change: We recently launched the equity repo and delivery workers payment features.
Speaker Change: <unk>, improving the efficiency of our stock of borrowing and lending operations and strengthening our service capability for institution and high network clients.
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Tianhua Wu: 老虎国际的图币业务保持发展势头 投行业务策,第一季度我们成销了四个港股IPO项目 包括赤峰黄金和南山纽约等 并且参与了碧血冰尘的港股IPO 其IPO认购金额创下了港股历史新高 在老虎平台上的打新认购金额突破了千亿港币 ESOP业务方面,今年第一季度我们新增20家ESOP客户 累计服务扣以达633家,同比增长10% In our corporate business, we underwrote four Hong Kong IPOs in the first quarter, including Chifenggou and Nanshan Alumina. and participated in Meixue Group's IPO, which set a new record for IPO subscription amount in the Hong Kong market. And the total subscription amount for this IPO exceeded HK$100 billion on August 1, 2018.
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Speaker Change: And participated in media group's ideal, which set new records for IPO subscription amount in the Hong Kong market and total subscription amount for this IPO exceeded 100 beauty and Hong Kong dollar our platform.
Tianhua Wu: In our eSoft business, we added 20 new clients in the first quarter, bringing the total number of eSoft clients served to 633 as of March 31, 2025, increased by 14% year over year.
Speaker Change: Europe business.
Speaker Change: Added 20, new clients in the fourth quarter, bringing the total number of Aesop clients served to 633.
Speaker Change: Mark.
Speaker Change: March 31, and 75 increased by 14% year over year.
Unknown Executive: 先请Several John 跟各位汇报下财务细节 Now I'd like to invite our CFO, John, to go over our financials. way.
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John: Now I'd like to invite our CFO John to go over our financials.
John: Yeah.
John: Okay.
John: Great.
Unknown Executive: Jeff, Tianhua, and Aaron.
John: Jessica Hi, Aaron.
Zhang Zeng: Let me go through our financial performance for the first quarter. All numbers are in U.S. dollars. Commission income was $58.3 million, increased 4% quarter over quarter, and more than double year over year. Interest income was $53.8 million, increased 23% year-over-year, but slightly decreased 4% quarter-over-quarter. The slight decrease was due to majority of our U.S. Treasury holdings were matured in the fourth quarter. So in this quarter, we have a one-time decrease of 1.5 million interest income. Together, total revenue reached 122.6 million. up 55.3% year-over-year.
Speaker Change: Let me go through our financial performance for the first quarter all numbers are in U S. Dollar.
Speaker Change: Commission income was $58 3 million increased 4% quarter over quarter and more than double year over year.
Speaker Change: Interest income was $53 8 million increased 23% year over year, that's 90 decreased 4% quarter over quarter.
Speaker Change: The slight decrease was due to a majority of our U S. Treasury holdings were maturing in the fourth quarter.
Speaker Change: So in this quarter, we had a one time decrease of one 5 million in interest income.
Speaker Change: Together total revenue reached $122 6 million.
Speaker Change: 55, 3% year over year.
Zhang Zeng: Cash Equities take rate was 6.7 bps this quarter, slightly decreased from 6.9 bps of last quarter. Within commission revenue, about 65% comes from cash equities. 30% from options and the rest from future and other products.
Speaker Change: Cash equities take rate was six seven bps this quarter slightly decreased by $6 nine bps of last quarter.
Speaker Change: Commission revenue about six about 65% comes from cash equities.
Speaker Change: 30% of our options and the rest from future and other products.
Zhang Zeng: Now, to close. Interest expense was 15 million, decreased 10% quarter over quarter, in line with the decrease in interest income, and slightly increased 2% compared to the same quarter of last year. Execution and clearing expenses were $5.3 million. increased 139% from the same period last year. It now has an increase in commission and trading volume. Employee compensation and benefits expense were 33.8 million, an increase of 22% year-over-year. Due to headcount increase due to recent overseas growth and R&D. Occupancy depreciation and amortization expense were $2.1 million. Remember flying year-over-year. Communication and market data expense were 9.8 million, an increase of 14% year-over-year due to the increase in Euro-based and IT-related service fee.
Speaker Change: Now onto cost.
Speaker Change: Interest expense was 15 million decreased 10% quarter over quarter.
Speaker Change: And that was the decrease in interest income as Danny increased 2% compared to the same quarter of last year.
Speaker Change: Execution of a carrying expense were $5 3 billion.
Speaker Change: Increased 139% from the same period last year.
Speaker Change: The increase in commission and trading volume.
Speaker Change: Employee compensation and benefits expense.
Speaker Change: Were $33 8 million.
Speaker Change: An increase of 22% year over year.
Speaker Change: Due to the headcount increase to address them oversee growth in R&D.
Speaker Change: Occupancy depreciation and amortization expense were $2 1 million.
Speaker Change: Remained flat year over year.
Speaker Change: Communication and market data expenses were $9 8 million, an increase of 14% year over year due to the increase in euro base and IP related service fees.
Zhang Zeng: Marketing expense for 10.9 million this quarter increased 148% year over year as market condition is more favorable versus a year ago for user acquisition. General and administrative expenses were $5.1 million, a decrease of 9% year-over-year due to a decrease in professional service fees. Total operating costs were $67.1 million. an increase of 32% from the same quarter of last year.
Speaker Change: Marketing expenses were $10 9 million in this quarter increased to 148% year over year as market conditions more favorable versus a year ago for user acquisition.
Speaker Change: General and administrative expenses were $5 1 million a decrease of 9% year over year due to a decrease in professional service fees.
Speaker Change: Total operating costs were 67 1 million.
Speaker Change: An increase of 32% from the same quarter of last year.
Zhang Zeng: As a result, bottom line increase on both gap and non-gap basis. Gap net income worth $30.4 million, up 8.4% quarter over quarter and 146.7% year over year. Long-Gap Lead Income Worth $36 Million 18.3% increase quarter over quarter and a 145% increase year over year. The long gap lead profit margin expanded from 25% in the previous quarter to nearly 30% this quarter.
Speaker Change: As a result bottom line increased on both GAAP and non-GAAP basis.
Speaker Change: GAAP net income were $30 4 million.
Speaker Change: Up eight 4% quarter over quarter, and 146, 7% year over year.
Speaker Change: non-GAAP net income was $36 million.
Speaker Change: 83% increase quarter over quarter, and a 145% increase year over year.
Speaker Change: The lockout led profit margin expanded from 25% in the previous quarter to nearly 30% this quarter.
Unknown Executive: Now I have concluded our presentation. Operator, please open the line for Q&A. Thank you, dear participants. If you would like to ask a question, please press star 11 on your telephone keypad and wait for your name to be announced. To withdraw a question, please press star 11 again. Once again, if you would like to ask a question, please press star 11.
Speaker Change: Now I have to conclude our presentation.
Speaker Change: Operator, please open the line for Q&A. Thanks.
Speaker Change: Thank you Dear participants if you'd like to ask a question. Please press star one one on the telephone keypad and Lake Finance will be announced to withdraw. Your question. Please press star one again once again, if you would like to ask a question. Please press star one one.
Unknown Executive: And now we're going to take our first question.
Speaker Change: And now we'll go and take our first question.
Emma Xu: And the question comes to the line of Cindy Wang from China Renaissance. Your line is open, please ask your question. Thank you for giving me the opportunity to ask this question. Congratulations to the company for a brilliant performance in the first quarter. I have two questions to ask.
Speaker Change: And the question comes from the line of Thank you Wang from China Renaissance. Your line is open. Please ask your question.
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Emma Xu: First, due to the fluctuation in the overall market in the second quarter, what impact does this have on the company's second quarter operating indicators? Can you analyze the situation of the transaction volume, customer assets, and new funds accounts? Second, we see a further increase in the company's first quarter profitability.
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Emma Xu: Looking to the future, how should we consider the cost control, especially the number of employees and marketing costs? Can you give us some guidance on customer costs? I will quickly translate my question. Thanks for taking my question and congrats for the great first quarter result. I have two questions here.
Speaker Change: Thank you Keisha.
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Mike: Thank you <unk>.
Speaker Change: Thanks for taking my question and congrats for the.
Mike: First quarter results.
Mike: Two questions here first with markets remain valid.
Emma Xu: First, with markets remaining volatile in seventh quarter, how have these affected the company's run rate so far? And could you share any early trends around trading volume, client assets, and newly funded accounts? Second, companies saw further improvement in profitability in first quarter.
Mike: Volatile in second quarter, how has this affected the company's wrong, Rachel Fox and could you share any early.
Mike: Around trading volume client asset and newly funded accounts.
Mike: Got it.
Sean: Company. So further improvement in profitability in first quarter looking ahead, how should we think about the cost, particularly like head count and customer a question Sean.
Emma Xu: Looking ahead, how should we think about the cost, particularly like headcount and customer acquisition? Can you provide us some guidance on the outlook for customer acquisition cost? Thank you.
Sean: Can you provide us some guidance on the outlook for <unk>.
Sean: My question is on cost.
Sean: You.
Tianhua Wu: I will answer the first question, and Judy will answer the second one. In general, we are quite satisfied with the business performance so far in the second quarter. In terms of transaction volume, the impact of the tariff war in April has caused a significant fluctuation in the market. This also caused the transaction volume of the month to break the company's historical high. Our first monthly transaction volume reached a scale of $1,000 billion. So from the second quarter to the current situation, it has improved compared to the same period in the first quarter. Of course, it is not certain what kind of news will happen in June.
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Tianhua Wu: We will continue to pay attention to the transaction situation in June. In terms of customer assets, the entry level of April and May is still a strong trend in the first quarter. In addition, all the market institutions and retail investors in the company have shown a state of entry. In addition, since the end of April, there has been a very obvious rebound in the market. This also brought some gains to the users. So as of now, we have seen a double-digit growth compared to the end of the first quarter. In terms of entry-level users, due to the fluctuating market in the second quarter, we have also made corresponding dynamic adjustments to the activity and method of trading.
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Tianhua Wu: We expect that the number of new entry-level users will decline in the first quarter. But overall user quality remains healthy. to maintain a positive trend. We are confident in our goal of completing 10,000 new users by the end of the year. Thank you. Okay, I'll translate for this part. Overall, we are quite pleased with how things are shaping up in the second quarter so far. In terms of trading volume, we saw a significant pickup in market volatility in April, mainly driven by the concerns over the tariff . That actually pushed our monthly trading volume to a new record.
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Josh: Okay, I will translate both at arc.
Josh: Overall, we are quite we are hoping for showing up in the second quarter Cooper.
Josh: In terms of trading volume with a significant pickup in market volatility in April relative about the concern over the over the Eric.
Josh: That actually push our monthly it's rewarding to a new record.
Tianhua Wu: Crossing 100 billion U.S. dollars for the first time in our history. So far in Q2, we've seen an improvement compared to the same period in the Q1. And it's hard to predict what headline news might emerge in June, but we will be closely monitoring market activities throughout the month. And in terms of client assets, net asset inflow remained strong throughout April and May, continuing the solid pace we saw in the first quarter. Both institutions and retail clients across all of our licensed markets contributed positively. And starting from late April, the market rebound helps drive some meaningful market gains as well.
Josh: <unk> 100 billion U S dollar.
Josh: First time in your history so.
Josh: So far in Q2, we've seen nine kirkman compared to the same period in the Q1.
Josh: And it's hard to predict what had our newest emerge in June, but we will be closing.
Josh: Alright closely monitor market activity throughout the month and in terms of growth. After net asset inflow remained strong throughout the April and May continuing the solid pace, we saw in the fourth quarter, both infusion and retail clients across all of our lifetime arcade contributed positively.
Josh: And starting from late April the market rebound and helps drive some meaningful mark to market GAAP as well as the <unk>.
Tianhua Wu: As of now, plant assets already set another record high and increased by around double digits compared to the end of the first quarter. And when it comes to the new funded accounts, during the increased market volatility in Q2, we made dynamic adjustment to our acquisition strategies. So we expect the number of new funded users will decrease compared to the high base in the Q1. So the user quality remains healthy and net asset inflow continues to be robust. Therefore, we are confident to meet our annual guidance of at least 150,000 new funded users this year.
Josh: Now none of that's already set another record.
Josh: And increased by around about it as compared to the end of the first quarter.
Josh: And when it comes to the new funded accounts during the increased market volatility in Q2.
Josh: Dynamic adjustment to our acute business strategies. So we expect the number of new users will decrease compared to the high base in Q1.
Josh: The user quality remained healthy.
Josh: Net asset inflow cost continued to be robust.
Josh: Therefore, we are confident to meet our annual guidance of one.
Josh: 150000.
Josh: Users this year.
Josh: Yes.
Tianhua Wu: OK, let me answer Cindy's second question. In terms of manpower cost, we will continue to increase our investment in product and technology development, ensuring that we continue to lead in products. At the same time, we will strengthen the team building of Hong Kong and the United States as the core market, covering the introduction of high-quality talent from the front desk, the middle desk and the back desk. Sponsored ADR Class A We will continue to invest in more resources in the acquisition to enhance the brand awareness and user penetration of the platform in the local market.
Josh: Okay now work with ICR.
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Josh: Hi, guys, Hi, Tom Hi.
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Tianhua Wu: Of course, the specific rhythm will be adjusted according to the market environment. But overall, we expect to see an upward trend in the investment in the acquisition.
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Tianhua Wu: 从数据上来看,2024年和2025年一季度,我们的人均获得成本在150到180之间。 Based on the data, in the year 2024 and year 2025, our per capita acquisition cost was between 150 and 180. In the second half of this year, we expect that the cost per capita will increase to 250 to 300 times a year for two main reasons. One is that in Hong Kong, a market with high user quality like this will increase productivity. From the point of view of PayPal, the appropriate increase in cost per capita is acceptable. Sponsored ADR Class A Let me translate what I just said. So in regards to labor costs, we will continue to invest in Prada and R&D to maintain our competitive edge as technology is the core of our platform.
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Josh: Sure.
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Josh: In regards to labor costs, we will continue to invest in product and R&D to maintain our competitive edge as technology is the core of our platform.
Tianhua Wu: At the same time, we will be expanding our team in key markets like Hong Kong and the U.S., and of course functions from front office to back office. Let me say our overall headcount growth will remain disciplined. We expect compensation expense to grow about 10 to 20% per year. We will invest more in customer acquisition to build a stronger brand and penetrate deeper into our core market. The pace of the pace of our marketing spending will be based on market conditions. But we expect to spend more in the second half of this year. Our average CAC is between 150 to 180 through 2024 and first quarter of 2025.
Josh: At the same time, we'll be extending our acumen in key markets like Hong Kong and the U S.
Josh: And of course functions from one office to back office.
Josh: Let me say, our overall headcount growth will remain disciplined.
Josh: We expect compensation expense to grow about 10% to 20% per year.
Speaker Change: Although U S volume customer acquisition to build stronger brands and penetrate deeper into our core markets.
Josh: The pace of the pace of our marketing spending will be based on market conditions.
Josh: We expense, we expect to spend more in the second half of this year.
Josh: Our average <unk> between 150 to 180 through 2024 in the first quarter of 2025.
Tianhua Wu: For the next few quarters, we expect the average CAC to rise to around $250 to $300. There are two key reasons for this. First of all, we will beat back efforts in high-value markets like Hong Kong, where the quality of users is significantly higher. From a payback perspective, a higher CAC in those markets is acceptable. We are also ready to invest more in brand and user awareness. This type of investments might not yield immediate conversions, which can push up CAC in the short term, but they are important for our long term growth and brand awareness.
Josh: For the next few quarters, we expect the average GAC to rise to around 250 to 300 horsepower.
Josh: There are two key reasons for this first of all it will be part of our efforts in high value markets like Hong Kong, where the quality of the users is significantly higher.
Josh: From a payback perspective, our highest GAC those markets it's acceptable.
Josh: We are also ready to invest more in brand the user awareness.
Josh: This type of investments minor Yale immediate Congress immediate.
Josh: Conversions, which can push outs in the short term.
Josh: But as they are important for our long term growth and brand awareness.
Unknown Executive: Thank you.
Unknown Executive: Lydia, please go for the next question. Thank you.
Josh: Thank you.
Josh: Media vehicles for the next question.
Unknown Executive: Now we're going to take our next question.
Josh: You.
Josh: Now we're going to take our next question.
You Fan: And the next question comes from Emma Xu from Bank of America. Your line is open, please ask your question. Thank you for giving me the opportunity to ask this question. Congratulations on the company's strong profit growth. I have two questions. The first question is about the deposit. We see that in the first quarter, the asset inflow was particularly strong, which promoted customer total assets and achieved a double-digit growth.
Josh: And the next question comes from the line of <unk> <unk> from Bank of America. Your line is open. Please ask your question.
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You Fan: Can you explain in detail the distribution of funds and the type of account?
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You Fan: The second question is about interest income and sensitivity analysis. In the first quarter, the interest income increased by about 15%. But the interest income is about the same as the last quarter. Is this mainly due to the decline in interest rates? If the Fed has a two-time drop of 25 points each time this year, how much impact will it have on the company's profits? I will briefly translate my question. So congratulations on another quarter of strong growth. I have two questions. The first one is about the asset inflow. It was particularly strong in the first quarter, contributing to a double-digit increase in your total client assets.
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Lindsay: Thank you Lindsay.
Speaker Change: So congratulations on another quarter of strong growth.
Speaker Change: I have two questions. The first one is about the asset inflow.
Speaker Change: Particularly strong in the first quarter contributing to a double digit increase in your total client asset. So could you elaborate on the breakdown of lease inflows intesa for agents and a call types.
You Fan: So could you elaborate on the breakdown of these inflows in terms of regions and account types?
You Fan: The second question is about your interest income. We can see that your margin financing and security lending balances grew around 15% in the first quarter, yet the net interest income remained flattish sequentially. Was this primarily driven by the declining interest rate? If the Fed cuts interest rate twice this year, say by 25 BIP each time, what will be the estimated impact on your P&L? Thank you.
Speaker Change: My question is about your interest income we can see that your major financing and securities lending balances screwed around 15% in the first quarter yet the net interest income remained flattish sequentially with base, primarily driven by the declining interest rate if the fed cuts interest rates twice this year say by 'twenty.
Speaker Change: Each time, what would be the estimated impact on your P&L.
Tianhua Wu: I will answer the first question and then answer the second one. Our first quarter income was about $3.2 billion. About 60% of it came from users in the Greater China region, about 30% came from Singapore, and about 10% came from the US and Australia. In total, more than 60% of the shares are from Saco. In the first quarter, we recorded about 3.2 billion U.S. dollars in net asset inflows. Around 60% of them came from the users in the greater China area, 30% from Singapore, and the remaining 10% from US and Australia New Zealand market. Overall, roughly 60% of NetAffect inflow was contributed by risk.
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Speaker Change: Okay.
Speaker Change: In the first quarter, we recorded about $3 2 billion U S. Dollar in net asset inflows are up.
Speaker Change: And 60% of them came from the user from the greater China area, 30% from Singapore, and the remaining 10% from U S and Australia due to that market.
Speaker Change: Overall, roughly 60% of net asset inflows were contributed by retail clients.
Zhang Zeng: OK, Emma, let me answer your second question. First of all, the rise of the overall two-way trade is driven by the more active market environment. Although there is a new impact, the net interest income from the two-way part has actually risen compared to the previous period. Our net interest income this quarter has fallen slightly compared to the previous period because the company invested some U.S. Treasury with house money. Most of these national bonds have expired at the end of last year, which has led to a $1.5 million interest reduction This is a one-off figure. As for the impact of the decline, we expect that there will be a negative impact on our net interest income for about $1 million to $1.5 million every year, It is about 1% of our total income.
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Zhang Zeng: Okay, so the closing margin financing and security balance was mainly driven by more active market backdrop. Our net interest income from margin financing alone actually increased quarter over quarter, despite the rate cut implication. The reason our total net interest income remained flat this quarter is because a larger portion of our U.S. treasury investment matured at the end of last year, which had a quarter over quarter impact of $4.5 million U.S. As for the impact of future rate cuts, we estimate that for every 25 pips cut by the Federal Reserve, our quarterly net interest income will be likely to be impacted by about 1 to 1.5 million, which is about roughly 1% of our quarterly revenue.
Speaker Change: Okay. So the grocery margin financing and the balance was mainly driven by a more active market backdrop are.
Speaker Change: Net interest income from.
Speaker Change: Margin in financing alone actually increased quarter over quarter, despite the rate cut.
Speaker Change: No implication there is our total net interest income remained flat this quarter is because a larger portion of our U S. Treasury investment mature at the end of last year, which had a quarter over quarter in power above $4 5 million U S. Dollar.
Speaker Change: As for the empower future rate cuts.
Speaker Change: Estimate that for every 25 bps cut by the fed.
Speaker Change: By the Federal reserve.
Speaker Change: Our quarterly net interest income will be negatively impact by about a one to one $5 million, which is roughly what percent of our children.
Unknown Executive: Thanks. Thanks Emma.
Speaker Change: Quarterly revenue thanks.
Unknown Executive: Operator, please proceed to next question. Thank you.
Speaker Change: Thanks Omar operator. Please proceed from next question.
Speaker Change: Thank you.
Unknown Executive: Now we're going to go to the next question.
Speaker Change: Now I will go and take our next question.
You Fan: and the question comes to you from You Fan from CICC. Your line is open, please ask your question. Thank you for giving me the opportunity to ask questions.
Speaker Change: And that question comes from the line of Hugh <unk> from CIBC. Your line is open. Please ask your question.
Speaker Change: Okay.
Speaker Change: So go ahead.
You Fan: I am Fan You, an analyst from Zhongjing. I have two questions for the management team. One is about the new users. We see that this quarter is still very strong and has completed 40% of the annual management. I would like to ask the management team about the specific distribution of the new users. The second question is I would like to ask about the business progress of our first quarter in the Hong Kong market. Recently, we have seen that other competitors such as Ant Purchase Medicine have entered the Hong Kong market. I would like to ask about our view on the Hong Kong competition.
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You Fan: Will it be more intense in the future? If so, what are the opportunities in the Hong Kong market and where will the strategic focus be? Let me quickly translate. Thanks, management, for taking my questions. This is You You Fan from CICC. I have two questions here. The first one is that we see the strong new customer acquisition this quarter. Could you please provide a regional breakdown of the newly funded accounts in Q1? The second question is could you please update on your progress in the Hong Kong market during Q1 and how you view the market opportunity and strategic focus going forward considering the recent Ant Groups merger with BrightSmart Securities?
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Speaker Change: Thanks management for taking my questions.
Speaker Change: Ausiello Olson from SEC I have two questions.
Speaker Change: First of all is that we see the strong new customer acquisition. This culture could you. Please provide original breakdown of newly funded accounts in Q1.
Speaker Change: Second question could.
Speaker Change: Could you please update on your progress in the Hong Kong market during Q1, and how you view the market opportunity and the strategic focus going forward.
Speaker Change: Recently, our Scripps merger with <unk> Securities.
Tianhua Wu: Will this intensify the local competition? Thank you. First question. In the first quarter, about 45% of the new users came from Singapore and Southeast Asia. About 35% are from the Greater China region, and about 10% are from the Australian market and the US market. In the first quarter, about 45% of newly funded clients came from Singapore and Southeast Asia. Around 35% were from the Greater China region, and Australia, New Zealand, and the US market each accounted for about 10%.
Speaker Change: This intensified local competition. Thank you.
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Speaker Change: In the first quarter about four.
Speaker Change: 35% of newly funded ties came from Singapore and Southeast Asia.
Speaker Change: Around 45% were from the greater China region.
Speaker Change: In Australia, and New Zealand and the U S market each accounted for about 10%.
Tianhua Wu: Second question – The Hong Kong Stock Exchange is a competitive market, and the recent merger has proven that the market is very attractive from both its international financial status and the overall quality of its users. Hong Kong is a very good market, and more and more players are entering the market, which shows that this track is very promising. We also think that competition is also a good thing for users. It can constantly improve the service level of the entire industry. We are the best Internet blockchain company, and we have built a solid support network in many dimensions.
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Tianhua Wu: For example, we have excellent productivity efficiency in Hong Kong and the United States, and excellent product features, such as the richness of US stocks and derivatives, the ability to exchange virtual assets, and the deep application of AI in investment. These are all our outstanding advantages. In terms of products, we have also made some related diversification in the Hong Kong region. For example, our payments are generally lower than most platforms in the Hong Kong market. Our profit margin on the platform is also relatively more attractive. These are all our efforts to give users a real experience.
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Tianhua Wu: Next, we will continue to increase human resources and market investment in Hong Kong to bring a better product experience to local users. We are confident that we will continue to optimize products in the future and get the market share that belongs to us.
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Tianhua Wu: I would like to take this opportunity to summarize the performance of Hong Kong in the first quarter of this year. First of all, the quality of Hong Kong users is very outstanding in all our markets. Whether it is per capita assets or the return on investment, it is very eye-catching. The up value of Hong Kong is the highest in the whole group. In 2025, the average income of new customers in the first quarter will exceed $30,000. The growth of customer assets is also very strong. As of the first quarter, the growth of customer assets is more than four times.
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Tianhua Wu: The return on investment has also increased by more than 20%. On March 26th, we officially launched a new Tiger AI for Hong Kong users It provides unlimited free service This tool combines our leading global models and our own financial data to greatly improve the efficiency of investors' analysis and decision-making Hong Kong has always been a highly competitive market, and the recent merge between Ant Group and Brian Smart Securities, in our view, future validates the attractiveness of this market. Whether we look at its status as a global financial hub, or the high quality of its user base, Hong Kong remains a very compelling market.
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Mitra: Okay.
Mitra: Hong Kong has always been a highly competitive market and the recent merger between <unk> group and breath, Mark maturities the RVO future validate the attractiveness of this market.
Mitra: Either way look at it at the global financial hub are the high quality of the user base uncle remains a very compounding market.
Tianhua Wu: With more players entered, simply highlights the long-term potential of this market. From our perspective, increased competition is a good thing for local users. It raised the bar for the entire industry and encourages all of us to keep improving. As a tech-driven brokerage, Tiger has already built strong barriers across different key areas. This includes our clearing efficiency for Hong Kong and US equities, a robust product set, especially in the US derivatives, virtual asset trading capabilities, and the deep integration of AI in the investment process. I'd love for you to send us a card. We've also introduced some product differentiations to better serve local users.
Mitra: With more players enter simply highlight the long term potential of this market.
Mitra: And from our perspective increased competition is a good thing for local users.
Mitra: It raises the bar for the entire industry and encourage us all of us to keep improving as a tech driven brokerage hydro has already built strong barriers across different areas. This include our clearing efficiency for Hong Kong and the U S equities, a robust product effect.
Mitra: Specially in the U S derivatives virtual asset trading capabilities and the deep integration of AI in the in the end.
Mitra: The investment process.
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Mitra: <unk> also introduced some product differentiation to better serve local users for example, our trading Commission our January lower than in both platforms in this market and our emerging market bond year comparatively attractive. These.
Tianhua Wu: For example, our trading commissions are generally lower than most platforms in this market, and our money market fund yields are comparatively attractive. These are just a few ways we are delivering real value to users. So looking ahead, we plan to continue to invest in both talent and marketing in Hong Kong with the goal of delivering a superior product experience. We are confident that with time, continued optimization and consistent execution, we will be able to secure a meaningful share of the Hong Kong market.
Mitra: These are just a few ways, we are delivering real value for users.
Mitra: Looking ahead, we plan to continue invest in both talent and marketing in Hong Kong with the goal of delivering a superior product with spirit there.
Mitra: We are confident that with time.
Mitra: Optimization and consistent execution, we will be able to procure a meaningful share of the Hong Kong market.
Tianhua Wu: And here are some highlights about the Q1 operational highlights about the Hong Kong market. Firstly, thanks to the high average current assets and strong trading velocity, R2 from our Hong Kong users remains the highest among all the market bids. In the first quarter, new funded clients in Hong Kong brought in an average net asset inflow of over US$30,000. Secondly, client assets in Hong Kong continue to grow at a strong pace, up more than 20% quarter per quarter and over four times year over year, marking it one of our third largest markets in terms of asset and customer.
Mitra: And here are some highlights about the Q1 operational highlights about the Hong Kong market.
Mitra: Firstly, thanks to the high average credit offer and strong trading velocity.
Mitra: <unk> from our Hong Kong users remains the highest among all of the market we enter.
Mitra: In the FERC coder, new funded clients in Hong Kong bromine in a brief net asset inflow of over 30000 U S dollar.
Mitra: Secondly, Glenn office in Hong Kong continued to grow at a strong pace up more than 20% quarter over quarter and over four times year over year.
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Mitra: Our third largest market in terms of assets under custody.
Aron Lee: In March, we officially rolled out the upgraded Tiger AI for Hong Kong users. Now it's available with unlimited free access. Powered by world class leading language AI models, and our market data, Tiger AI is designed to help users analyze investments more efficiently and make smarter decisions. Thank Operator, next question please.
Mitra: In March we are officially rolled out the upgraded Tiger AI for Hong Kong user now it's available with unlimited free access powered by World class, leading language modal and our market data Tiger AI defined to have users annualized investment more efficiently and mixed moderate decision.
Speaker Change: Thank you.
Speaker Change: Operator next.
Mitra: Next question please.
Mitra: Okay.
Aron Lee: I would now like to hand the conference over to Aron Lee for any closing remarks. Thank you. I'd like to thank everyone for joining our call today. I'm now closing the call on behalf of the management team here at Tiger. We do appreciate your participation in today's call. If you have any further questions, please reach out to our investor relations team. This concludes the call. And thank you very much for your time. Bye-bye.
Mitra: For today I would now like to hand.
Mitra: And to the conference over to R&D for any closing remarks.
Mitra: Thank you.
Speaker Change: I'd like to thank everyone between our call today and not looking to call on behalf of the management team here at Tiger. We do appreciate your participation in today's call. If you will.
Speaker Change: And your first question please reach out to our Investor Relations team. This concludes the call and thank you very much bye bye.
Unknown Executive: This concludes today's conference call. Thank you for participating. You may now disconnect. Have a nice day.
Speaker Change: This concludes today's conference call. Thank you for participating you may now disconnect have a nice day.
Speaker Change: Okay.
Speaker Change: [music].