Q3 2025 Qifu Technology Inc Earnings Call

November 19, 2025

There will be a presentation followed by a question and answer session. If you wish to ask a question you will need to press the star key followed by the number one on your telephone keypad. Please also note today's event is being recorded.

Operator: All participants are in a listen-only mode. There will be a presentation followed by a question and answer session. If you wish to ask a question, you will need to press the star key followed by the 1 on your telephone keypad. Please also note today's event is being recorded. At this time, I'd like to turn the conference over to Ms. Karen Ji, Senior Director of Capital Markets. Please go ahead, Karen.

Operator: All participants are in a listen-only mode. There will be a presentation followed by a question-and-answer session. If you wish to ask a question, you will need to press the star key followed by the number one on your telephone keypad. Please also note today's event is being recorded. At this time, I'd like to turn the conference over to Ms. Karen Ji, Senior Director of Capital Markets. Please go ahead, Karen.

At this time I'd like to turn the conference over to MS. Karen G Senior director of capital markets. Please go ahead Karen.

Thank you Ken.

Hello, everyone.

Karen Ji: Thank you, Ken. Hello everyone, and welcome to Qifu Technology's Q4 2025 earnings conference call. Our earnings release was distributed earlier today and is available on our IR website. Joining me today are Mr. Wu Haisheng, our CEO, Mr. Alex Xu, our CFO, and Mr. Zhen Yan, our CRO. Before we start, I would like to refer you to our safe harbor statement in the earnings press release, which applies to this call as we will make certain forward-looking statements. Also, this call includes discussions of certain non-GAAP financial measures. Please refer to our earnings release, which contains a reconciliation of non-GAAP financial measures to GAAP financial measures. Also, please note that unless otherwise stated, all figures mentioned in this call are in RMB terms. In addition, today's prepared remarks from our CEO will be delivered in English using an AI-generated voice.

Karen Ji: Thank you, Cam. Welcome to Qifu Technology, Inc.'s Q3 2025 earnings conference call. Our earnings release was distributed earlier today and is available on our IR website. Joining me today are Haisheng Wu, our CEO, Alex Xu, our CFO, and Yan Zheng, our CIO. Before we start, I would like to refer you to our safe harbor statement in the earnings press release, which applies to this call as we will make certain forward-looking statements. This call includes discussions of certain non-GAAP financial measures. Please refer to our earnings release, which contains a reconciliation of non-GAAP financial measures to GAAP financial measures. Please note that unless otherwise stated, all figures mentioned in this call are in RMB terms. Today's prepared remarks from our CEO will be delivered in English using an AI-generated voice.

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Our earnings release was distributed earlier today and is available on our IR website.

Joining me today are Mr. <unk>, our CEO, Mr. Alex <unk>, our CFO and Mr. Jin Yan.

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We've always thought I would like to refer you to our safe Harbor statement in the earnings press release, which applies to this call as we will make certain forward looking statements.

Also this call includes discussions of certain non-GAAP financial measures.

Please refer to our earnings release, which contains a reconciliation of non-GAAP financial measures to GAAP financial measures.

Also please note that unless otherwise stated all figures mentioned in this call are in RMB terms.

In addition, today's prepared remarks from our CEO will be delivered in English using an AI generated avoid.

Now I will turn the call over to Mr. <unk>.

Karen Ji: Now, I will turn the call over to Mr. Haisheng Wu. Please go ahead.

Karen Ji: Now, I will turn the call over to Mr. Wu Haisheng. Please go ahead.

Please go ahead.

Hello, everyone.

Thank you for joining us today in.

Haisheng Wu: Hello, everyone. Thank you for joining us today. In the first 9 months of this year, China's economy and the consumer finance sector have both faced persistent headwinds. The outstanding balance of short-term consumer loans has declined for 3 consecutive quarters on both a year-over-year and quarter-over-quarter basis. Going into Q3, the industry is undergoing a series of regulatory driven adjustments to improve consumer financial inclusion. We believe these changes will strengthen the sector's long-term prospects and sustainability, paving the way for healthier and more structured competitive landscape. As such, we view these adjustments not only a challenge, but also an opportunity for Qifu. As a leading Credit-Tech platform in China, we continued to prioritize risk management, advance our AI capabilities, and deepen collaboration with financial institutions. We believe these efforts will enable us to better serve inclusive finance needs and strengthen our leadership in the industry.

Haisheng Wu: Hello everyone. Thank you for joining us today. In the first nine months of this year, China's economy and the consumer finance sector have both faced persistent headwinds. The outstanding balance of short-term consumer loans has declined for three consecutive quarters on both a year-over-year and quarter-over-quarter basis. Going into Q3, the industry is undergoing a series of regulatory-driven adjustments to improve consumer financial inclusion. We believe these changes will strengthen the sector's long-term prospects and sustainability, paving the way for a healthier, more structured competitive landscape. As such, we view these adjustments not only as a challenge but also as an opportunity for Qifu Technology. As a leading credit tech platform in China, we continue to prioritize risk management, advance our AI capabilities, and deepen collaboration with financial institutions. We believe these efforts will enable us to better serve inclusive finance needs and strengthen our leadership in the industry.

In the first nine months of this year, China's economy, and the consumer finance sector have both faced persistent headwinds the.

The outstanding balance of short term consumer loans has declined for three consecutive quarters on both a year over year and quarter over quarter basis.

Going into Q3.

The industry is undergoing a series of regulatory driven adjustments to improve consumer financial inclusion we.

We believe these changes will strengthen the sectors long term prospects and sustainability paving the way for a healthier and more structured competitive landscape.

As such we view these adjustments not only a challenge, but also an opportunity for <unk>.

As a leading credit tech platform in China, we continued to prioritize risk management.

<unk>, our AI capabilities and deepen collaboration with financial institutions.

We believe these efforts will enable us to better serve inclusive finance needs and strengthen our leadership in the industry.

Now I'll walk you through the progress we made in Q3.

Haisheng Wu: Now, I'll walk you through the progress we made in Q3. By the end of the quarter, our AI-powered credit decision engine and asset distribution platform served 167 financial institutions, delivering efficient, intelligent digital credit services to over 62 million credit line users on a cumulative basis. To navigate the evolving regulatory environment, we dynamically fine-tuned our risk strategies to maintain a healthy balance between risk and growth. As a result, total loan facilitation and origination volume on our platform reached RMB 83.3 billion in the quarter, broadly in line with Q2. Despite the macro headwinds, we delivered steady financial results. Non-GAAP net income reached RMB 1.51 billion, while non-GAAP EPADS, on a fully diluted basis, came in at RMB 11.36, reflecting our solid profitability and operating resilience.

Haisheng Wu: I'll walk you through the progress we made in Q3. By the end of the quarter, our AI-powered credit decision engine and asset distribution platform served 167 financial institutions, delivering efficient, intelligent digital credit services to over 62 million credit line users on a cumulative basis. To navigate the evolving regulatory environment, we dynamically fine-tuned our risk strategies to maintain a healthy balance between risk and growth. As a result, total loan facilitation and origination volume on our platform reached RMB 83.3 billion in the quarter, broadly in line with Q2. Despite the macro headwinds, we delivered steady financial results. Non-GAAP net income reached RMB 1.51 billion, while Non-GAAP EPADS on a fully diluted basis came in at RMB 11.36, reflecting our solid profitability and operating resilience.

By the end of the quarter, our AI powered a credit decision engine and asset distribution platform served 167 financial institutions.

Delivering efficient inter.

Intelligent digital credit services to over 62 million credit line users on accumulative basis too.

To navigate the evolving regulatory environment with dynamically fine tuned our risk strategies to maintain a healthy balance between risk and growth.

As a result total loan facilitation and origination volume on our platform reached RMB $83 3 billion in the quarter broadly in line with Q2.

Despite the macro headwinds.

We delivered a steady financial results.

non-GAAP net income reached RMB 151 billion, while non-GAAP EPS on a fully diluted basis came in at RMB 11 36.

Reflecting our solid profitability and operating resilience.

On the risk front funding liquidity in the high priced segment continued to tighten in Q3, leading to an uptick in overall delinquency risk across the industry too.

Haisheng Wu: On the risk front, funding liquidity in the high-priced segment continued to tighten in Q3, leading to an uptick in overall delinquency risk across the industry. To stay closely aligned with evolving market conditions, we further tightened our credit standards and optimized our customer mix by increasing the proportion of high-quality borrowers. In addition, we proactively refined our risk models and completed 611 iterations, implementing differentiated risk management and distribution strategies. On the collection front, we improved efficiency through smarter resource allocation and deeper technology integration. For example, we allocated more resources to high-performing collection partners to ensure sufficient capacity and better productivity. For customers willing to repay but facing temporary financial difficulties, we offered measured concessions and flexible repayment options. In addition, we were able to assess repayment intent and capacity in real time through large language model algorithms, enabling more precise segmentation and more agile resource deployment.

Haisheng Wu: On the risk front, funding liquidity in the high price segment continued to tighten in Q3, leading to an uptick in overall delinquency risk across the industry. To stay closely aligned with evolving market conditions, we further tightened our credit standards and optimized our customer mix by increasing the proportion of high-quality borrowers. In addition, we proactively refined our risk models and completed 611 iterations, implementing differentiated risk management and distribution strategies. On the collection front, we improved efficiency through smarter resource allocation, and deeper technology integration. For example, we allocated more resources to high-performing collection partners to ensure sufficient capacity and better productivity. For customers willing to repay but facing temporary financial difficulties, we offered measured concessions and flexible repayment options.

To stay closely aligned with the evolving market conditions, we further tightened our credit standards.

<unk> optimized our customer mix.

Increasing the proportion of high quality borrowers.

In addition, we proactively refined our risk models and the completed the 611 iterations implementing differentiated risk management and distribution strategies on.

On the collection front, we improved efficiency through smarter resource allocation and deeper technology integration.

For example, we allocated more resources to high performing collection partners to ensure sufficient capacity and better productivity for.

Customers willing to repay but facing temporary financial difficulties, we offered measured concessions and flexible repayment options in.

In addition, we were able to assess repayment intent and capacity in real time through large language model algorithms, enabling more precise segmentation and more agile resource deployment.

Haisheng Wu: We were able to assess repayment intent and capacity in real-time through large language model algorithms, enabling more precise segmentation and more agile resource deployment. These efforts helped us maintain steady progress even as the broader industry faced rising collection pressure. Our FPD7, a leading risk indicator for new loans, declined in September versus August. Since October, given the new regulations and heightened industry self-discipline initiatives, we expect risk indicators to remain volatile in the near term, with current levels above historical averages. That said, having navigated multiple industry adjustment cycles in the past with prompt and effective responses, we remain confident that we can once again bring risk levels back within a reasonable range in a timely manner. On the funding front, we have been whitelisted by all of our active financial institution partners, ensuring a smooth and stable cooperation going forward.

These efforts helped us maintain steady progress even as the broader industry faced rising collection pressure.

Haisheng Wu: These efforts helped us maintain steady progress even as the broader industry faced rising collection pressure. Our FPD7, a leading risk indicator for new loans, declined in September versus August. Since October, given the new regulations and heightened industry self-discipline initiatives, we expect risk indicators to remain volatile in the near term, with current levels above historical averages. That said, having navigated multiple industry adjustment cycles in the past with prompt and effective responses, we remain confident that we can once again bring risk levels back within a reasonable range in a timely manner. On the funding front, we have been whitelisted by all of our active financial institution partners, ensuring a smooth and stable cooperation going forward. Despite a relatively tight funding environment driven by liquidity conditions and policy factors, we maintained industry-leading pricing power, and secured ample funding supply at stable costs.

Our SPD seven a leading risk indicator for new loans declined in September versus August since October given the new regulations and heightened the industry self discipline initiatives, we expect risk indicators to remain volatile in the near term with current levels.

<unk> above historical averages.

That said, having navigated multiple industry adjustments cycles in the past with prompt and effective responses. We remain confident that we can once again bring risk levels back within the reasonable range in a timely manner.

On the funding front, we have been white listed by all of our active financial institution partners, ensuring a smooth and stable cooperation going forward.

Despite the relatively tight funding environment, driven by liquidity conditions and policy factors, we maintained the industry, leading pricing power and secured ample funding supply at stable costs.

Haisheng Wu: Despite a relatively tight funding environment driven by liquidity conditions and policy factors, we maintained the industry-leading pricing power and secured ample funding supply at stable costs. Our average funding cost for Q3 held steady from last quarter, remaining at historical lows. In the ABS market, we issued RMB 4.5 billion during the quarter, up 29% year-over-year, with issuance costs down by another 10 basis points. For the first 9 months of 2025, total ABS issuance grew 41% year-over-year to RMB 18.9 billion, further optimizing our funding structure. Looking ahead, we expect our funding costs to remain largely stable in the coming quarters. For user acquisition, we continued to diversify our channels, enhance targeted operation, and improve efficiency.

Our average funding cost for Q3, how the steady from last quarter remaining at historical lows.

Haisheng Wu: Our average funding cost for Q3 held steady from last quarter, remaining at historical lows. In the ABS market, we issued RMB 4.5 billion during the quarter, up 29% year-over-year, with issuance costs down by another 10 basis points. For the first nine months of 2025, total ABS issuance grew 41% year-over-year to RMB 18.9 billion, further optimizing our funding structure. Looking ahead, we expect our funding costs to remain largely stable in the coming quarters. For user acquisition, we continue to diversify our channels, enhance targeted operation, and improve efficiency. Compared with last quarter, the number of new credit line users grew by 9% to 1.95 million, while average cost per credit line user declined by 8%. The number of new borrowers also grew 10% sequentially to 1.35 million.

In the ABS market, we issued RMB four 5 billion during the quarter up 29% year over year with issuance costs down by another 10 basis points for.

For the first nine months of 2025 total ABS issuance grew 41% year over year to RMB 18.9 billion further optimizing our funding structure.

Looking ahead, we expect our funding costs to remain largely stable in the coming quarters.

For user acquisition, we continue to diversify our channels enhance targeted operation and improve efficiency compared with last quarter. The number of new credit line users grew by 9% to $195 million, while average cost per credit line user declined by 8%.

Haisheng Wu: Compared with last quarter, the number of new credit line users grew by 9% to 1.95 million, while average cost per credit line user declined by 8%. The number of new borrowers also grew 10% sequentially to 1.35 million. We have seamlessly integrated convenient and efficient credit services into diversified channels and scenarios, including short-form videos, e-commerce, mobility, food delivery, and financial services. In Q3, we further expanded our embedded finance network, adding 7 new strategic partners and extending our presence across internet and financial institution platforms. As a result, the number of new credit line users from the embedded finance channels increased by 13% sequentially, while loan volume up by 11%. For placement strategy, we remained focused on onboarding high-quality users and optimizing our overall user mix.

The number of new borrowers also grew 10% sequentially to 1.35 million.

We have a seamlessly integrated convenient and efficient credit services into a diversified channels and the scenarios, including short form videos E Commerce mobility food delivery and the financial services.

Haisheng Wu: We have seamlessly integrated convenient and efficient credit services into diversified channels and scenarios, including short-form videos, e-commerce, mobility, food delivery, and financial services. In Q3, we further expanded our embedded finance network, adding seven new strategic partners and extending our presence across internet and financial institution platforms. As a result, the number of new credit line users from the embedded finance channels increased by 13% sequentially, while loan volume was up by 11%. For placement strategy, we remain focused on onboarding high-quality users and optimizing our overall user mix. As such, our long-term strategic priority will focus more on our high-quality customers. Supported by AI-driven data models, we expect to gain deeper insights into user needs and behaviors, and further refine products and services. This approach will allow us to deliver a superior user experience and improve both our unit economics and user lifetime value.

In Q3, we further expanded our embedded finance network.

Adding seven new strategic partners, and extending our presence across internet and financial institution platforms.

As a result.

The number of new credit line users from the embedded finance channels.

Increased by 13% sequentially, while loan volume up by 11%.

For placement strategy, we remained focused on onboarding and high quality users and optimizing our overall user mix as.

As such our long term strategic priority, we will focus more on our high quality customers.

Haisheng Wu: As such, our long-term strategic priority will focus more on our high-quality customers. Supported by AI-driven data models, we expect to gain deeper insights into user needs and behaviors and further refine products and services. This approach will allow us to deliver a superior user experience and improve both our unit economics and user lifetime value. We believe this focus is critical to strengthening our long-term competitive edge and cementing our leadership position in the industry. In our Technology Solutions business, we continue to advance our AI plus banking strategy, empowering financial institutions in their digital and intelligent transformation. During the quarter, loan volume supported by this business achieved exponential growth, up by roughly 218% on a sequential basis.

Supported by AI, driven data models, we expect to gain deeper insights into user needs and behaviors and further refined products and services.

This approach will allow us to deliver a superior user experience and improve both our unit economics and user lifetime value we.

We believe this focus is critical to strengthening our long term competitive edge and cementing our leadership position in the industry.

Haisheng Wu: We believe this focus is critical to strengthening our long-term competitive edge and cementing our leadership position in the industry. In our technology solutions business, we continue to advance our AI+ banking strategy, empowering financial institutions in their digital and intelligent transformation. During the quarter, loan volume supported by this business achieved exponential growth, up by roughly 218% on a sequential basis. Our collaboration with banks continued to deepen, expanding from their proprietary channels to a broader range of internet scenarios, where we provide end-to-end technology support in customer acquisition and risk management. Powered by our Focus Pro Credit Tech platform, our proprietary solution for SME lending, which is built on a three-tiered credit assessment system, was adopted by several new banking partners, and received positive feedback for its industry-leading performance.

In our technology solutions business, we continued to advance our AI plus banking strategy empowering financial institutions in their digital and intelligent transformation during the quarter loan volume supported by this business achieved exponential growth up by roughly 200.

18% on a sequential basis.

Our collaboration with banks continued to deepen expanding from their proprietary channels to a broader range of internet scenarios.

Haisheng Wu: Our collaboration with banks continued to deepen, expanding from their proprietary channels to a broader range of internet scenarios where we provide end-to-end technology support in customer acquisition and risk management. Powered by our Focus Pro credit tech platform, our proprietary solution for SME lending, which is built on a three-tiered credit assessment system, was adopted by several new banking partners and received positive feedback for its industry-leading performance. As part of our AI plus banking initiative, our two proprietary AI agents, the AI Credit Officer and AI Loan Officer, entered pilot testing with our first bank client. The engagement rate among the activated user base has reached around 50%, providing initial validation for the AI agent's practical effectiveness in core credit scenarios.

Where we provide end to end technology support and customer acquisition and risk management powered.

Our proprietary solutions for SME lending, which is built on a three tiered credit assessment system.

Adopted by several new banking partners and received positive feedback for its industry leading performance.

As part of our AI plus banking initiatives, our two proprietary AI agents, the AI credit officer, and AI loan officer entered the pilot testing with our first bank client.

Haisheng Wu: As part of our AI+ banking initiative, our two proprietary AI agents, the AI Credit Officer and AI Loan Officer, entered pilot testing with our first bank client. The engagement rate among the activated user base has reached around 50%, providing initial validation for the AI agent's practical effectiveness in core credit scenarios. Looking ahead, we will focus on strengthening our capabilities in multimodal recognition, voice data collection, lead management, and feedback loops, while expanding pilot programs and further improving user engagement. At the same time, we are seeing growing interest from financial institutions, laying a strong foundation for broader commercial rollout and scaled adoption in the next phase. On 1 October 2024, the new rules officially came into effect. As a leading player in the industry, we have always held ourselves to the highest compliance standards, with no exception this time.

The engagement rate among the activated user base has reached around 50%, providing initial validation for the AI agents practical effectiveness and core credit scenarios.

Looking ahead, we will focus on strengthening our capabilities and multimodal recognition.

Haisheng Wu: Looking ahead, we will focus on strengthening our capabilities in multimodal recognition, voice data collection, lead management, and feedback loops while expanding pilot programs and further improving user engagement. At the same time, we are seeing growing interest from financial institutions, laying a strong foundation for broader commercial rollout and scaled adoption in the next phase. On 1 October, the new rules officially came into effect. As a leading player in the industry, we have always held ourselves to the highest compliance standards, with no exception this time. Working closely with our financial institution partners, we quickly optimized our business structure and product experience. While these measures may temporarily impact our loan volume and profitability, we believe that prioritizing value for users will eventually strengthen their trust and help us maintain more sustainable and resilient growth over the long term.

This data collection.

Lead management and feedback loops, while expanding pilot programs and are further improving user engagement at.

At the same time, we are seeing growing interest from financial institutions laying a strong foundation for a broader commercial rollout and a scaled adoption in the next phase.

On October 1st the new rules are officially came into effect.

As a leading player in the industry, we have always held ourselves to the highest compliance standards with no exception. This time.

Working closely with our financial institution partners with quickly optimize our business structure and product experience.

Haisheng Wu: Working closely with our financial institution partners, we quickly optimized our business structure and product experience. While these measures may temporarily impact our loan volume and profitability, we believe that prioritizing value for users will eventually strengthen their trust and help us maintain more sustainable, resilient growth over the long term. Meanwhile, certain new industry-wide regulatory measures may have some impact on the industry dynamics. That said, we believe our diversified business model and ample funding capacity will help position us to navigate these changes with limited disruption. Given the current phase of industry-wide adjustment, we will prioritize risk management over near-term growth, focusing on improving user quality and collection efficiency. Since mid-October, we have already seen encouraging early signs of stabilization in asset quality.

While these measures may temporarily impact our loan volume and profitability, we believe that prioritizing value for users will eventually strengthen their trust and help us maintain more sustainable and resilient growth over the long term. Meanwhile.

Certain new industry wide there regulatory measures may have some impact on the industry dynamics.

Haisheng Wu: Meanwhile, certain new industry-wide regulatory measures may have some impact on the industry dynamics. That said, we believe our diversified business model and ample funding capacity will help position us to navigate these changes with limited disruption. Given the current phase of industry-wide adjustment, we will prioritize risk management over near-term growth, focusing on improving user quality and collection efficiency. Since mid-October, we have already seen encouraging early signs of stabilization in asset quality. Over the years, we have a proven track record of emerging stronger from past challenges, including multiple industry-wide adjustments, and we are confident that this time will be no different. Looking ahead, we will continue to advance our One Body, Two Wings strategy, further strengthen our AI capabilities, and empower financial institutions in their digital transformation, driving efficient, healthy, and sustainable development of our core business.

That said, we believe our diversified business model and ample funding capacity will help position us to navigate these changes with limited disruption.

Given the current phase of industry wide adjustment, we will prioritize risk management over near term growth.

Focusing on improving user quality and collection efficiency.

Since mid October we have already seen encouraging early signs of stabilization in asset quality.

Over the years, we have a proven track record of emerging stronger from past challenges, including multiple industry wide adjustments.

Haisheng Wu: Over the years, we have a proven track record of emerging stronger from past challenges, including multiple industry-wide adjustments, and we are confident that this time will be no different. Looking ahead, we will continue to advance our one body, two wings strategy, further strengthen our AI capabilities, and empower financial institutions in their digital transformation, driving efficient, healthy, and sustainable development of our core business. On the international front, we are actively exploring opportunities across multiple overseas markets. After extensive research, we are even more convinced that our fintech capabilities are among the best in the world. We view the international expansion as a challenging, yet strategically sound path. Quality always comes from deliberate execution, and we are confident we will deliver. In closing, short-term industry headwinds will not alter our long-term trajectory or our fundamental commitment to giving back to our shareholders.

And we are confident that this time will be no different.

Looking ahead, we will continue to advance our one body two wings strategy further strengthen our AI capabilities and empower financial institutions in their digital transformation driving efficient health.

Healthy and sustainable development of our core business.

On the international front, we are actively exploring opportunities across multiple overseas markets.

Haisheng Wu: On the international front, we are actively exploring opportunities across multiple overseas markets. After extensive research, we are even more convinced that our fintech capabilities are among the best in the world. We view the international expansion as a challenging yet strategically sound path. Quality always comes from deliberate execution, and we are confident we will deliver. In closing, short-term industry headwinds will not alter our long-term trajectory or our fundamental commitment to giving back to our shareholders. Going forward, we will continue to pursue efficient capital allocation and deliver value to our shareholders through compelling shareholder returns. With that, I will now turn the call over to Alex.

After extensive research.

We are even more convinced that.

Our fintech capabilities.

Among the best in the World.

We viewed the international expansion as a challenging yet strategically sound path.

Quality always comes from deliberate execution and we are confident we will deliver.

In closing.

Short term industry headwinds will not alter our long term trajectory or our fundamental commitment to giving back to our shareholders.

Going forward, we will continue to pursue efficient capital allocation and deliver value to our shareholders through compelling shareholder returns.

Haisheng Wu: Going forward, we will continue to pursue efficient capital allocation and deliver value to our shareholders through compelling shareholder returns. With that, I will now turn the call over to Alex. Thank you, Haisheng. Good morning and good evening, everyone. Welcome to our third quarter earnings call. Unexpected chain of events in the last few months put significant pressure to our operations, and such headwinds may persist through the next couple of quarters as the consumer finance industry faces a new round of regulatory scrutiny, and the participants try to settle in a vastly different environment. Total net revenue for Q3 was RMB 5.21 billion versus RMB 5.22 billion in Q2 and RMB 4.37 billion a year ago. Revenue from credit-driven service, capital-heavy, was RMB 3.87 billion in Q3 compared to RMB 3.57 billion in Q2 and RMB 2.9 billion a year ago.

With that I will now turn the call over to Alex.

Okay.

Hi, Sean Good morning, and good evening, everyone welcome to our third quarter earnings call.

Alex Xu: Okay. Thank you, Haixiang. Good morning and good evening, everyone. Welcome to our Q3 earnings call. Unexpected chain of events in the last few months put significant pressure to our operations, and such headwinds may persist through the next couple quarters as the consumer finance industry faces new round of regulatory scrutiny and the participants try to settle in the vastly different environment. Net revenue for Q3 was CNY 5.21 billion, versus CNY 5.22 billion in Q2, and CNY 4.37 billion a year ago. Revenue from credit-driven service, capital-heavy, was CNY 3.87 billion in Q3, compared to CNY 3.57 billion in Q2 and CNY 2.9 billion a year ago. The sequential and year-on-year increase was mainly driven by higher capital-heavy loan balance.

Unexpected chinas advance in the last few months puts significant pressure to our operations and as such headwinds may persist through the next couple of quarters as consumer finance industry faced this new round of a regulatory scrutiny.

And the participants try to settle in the vastly different environment.

Total revenue net revenue for Q3 was $5 to 1 billion versus $5 2 billion in Q2, and $4 $3 7 billion a year ago revs.

Revenue from credit driven service capital heavy was $3 87 billion in Q3 compared to $3 five 7 billion in Q2, and $2 9 billion a year ago.

The sequential and year on year increase was mainly driven by higher capital have a loan balance.

Haisheng Wu: The sequential and year-on-year increase was mainly driven by higher capital-heavy loan balance. Overall funding costs remained stable in Q1, Q2, despite some liquidity shortage later in the quarter. In the first three quarters, we issued a record-breaking RMB 18.9 billion ABS, an increase of over 40% year-on-year. Revenue from platform service, capital-light, was RMB 1.34 billion in Q3 compared to RMB 1.65 billion in Q2 and RMB 1.47 billion a year ago. The year-on-year and sequential decline was mainly driven by lower capital-light facilitation and ICE volume. Platform service accounts for roughly 48% of quarter-ending loan balance. We will continue to make timely adjustments to the business mix through the rest of the year to reflect the changing market dynamic and regulatory guidelines. During the quarter, average IRR of the loans we originated and/or facilitated was 20.9% compared to 21.4% in Q2.

Overall funding costs remained stable Q on Q. Despite some liquidity shortage later in the quarter.

Alex Xu: Overall funding costs remained stable Q on Q, despite some liquidity shortage later in the quarter. In the first three quarters, we issued a record-breaking 18.9 billion ABS, an increase of over 40% year-on-year. Revenue from platform service, capital-light, was CNY 1.34 billion in Q3, compared to CNY 1.65 billion in Q2, and CNY 1.47 billion a year ago. The year-on-year and sequential decline was mainly driven by lower capital-light facilitation and ICE volume. Platform service account for roughly 48% of a quarter-ending loan balance. We will continue to make timely adjustments to the business mix through the rest of the year to reflect the changing market dynamic and regulatory guidelines. During the quarter, average IRR of the loans we originated and/or facilitated was 20.9%, compared to 21.4% in Q2.

In the first three quarters, we issued a record breaking 18 9 billion ABS and increase of over 40% year on year.

Revenue from platform service capital Light was $1 24 billion in Q3 compared to 165 billion in Q2, and 147 billion a year ago.

Year on year, and sequential decline was mainly driven by lower capitalized facilitation and ICU volume.

Platform services account for roughly 48% of our quarter ending loan balance we will continue to make timely adjustments to the business mix sort of the rest of the year to reflect the changing market dynamic and the regulatory guidelines.

During the quarter average IRR of the loans, we originated and all facilitated was 29%.

Compared to 21, 4% in Q2.

Looking forward, we may see further price decline as the new regulatory environment requirements being fully implemented across the industry, although the pace of the decline should be modest.

Alex Xu: Looking forward, we may see further pricing decline as the new regulatory environment requirement being fully implemented across the industry. The pace of the decline should be modest. Sales and marketing expenses remained stable Q on Q, unit cost declined by about 8% sequentially. We added approximately 1.95 million new credit line users in Q3 versus 1.79 million in Q2. We will likely to adjust the pace of the new user acquisition in the coming months, given the volatile macro condition and to further optimize our user acquisition channels and improve user engagement and intent retention. 90-day delinquency rate was 2.09% in Q3, compared to 1.97% in Q2. Day 1 delinquency rate was 5.5% in Q3 versus 5.1% in Q2.

Haisheng Wu: Looking forward, we may see further pricing decline as a new regulatory environment requirement is being fully implemented across the industry, although the pace of the decline should be modest. Sales and marketing expenses remained stable in Q1 and Q2, but unit costs declined by about 8% sequentially. We added approximately 1.95 million new credit line users in Q3 versus 1.79 million in Q2. We will likely adjust the pace of new user acquisition in the coming months, given the volatile micro-condition, and further optimize our user acquisition channels and improve user engagement and retention. Ninety-day delinquency rate was 2.09% in Q3 compared to 1.97% in Q2. Day-one delinquency rate was 5.5% in Q3 versus 5.1% in Q2. Thirty-day collection rate was 85.7% in Q3 versus 87.3% in Q2. C-M2, which represents the outstanding delinquency rate after 30 days collection, increased in Q1 and Q2 to 0.79% from 0.64%.

Sales of the marketing expenses.

<unk> stable Q on Q, but the unit cost declined by about 8% sequentially.

We added approximately $195 million new credit line users in Q3 versus $1 $709 million in Q2.

We will likely to adjust the pace of the new user acquisition in the coming months, given the volatile macro condition and further optimize our user acquisition channels and improve user engagement and maintain retention.

90 day delinquency rate was two point <unk>, 9% in Q3 compared to 197% in Q2.

Delinquency rate was five 5% in Q3 versus five 1% in Q2.

30 day collection rate was 85, 7% in Q3 versus 87, 3% in Q2.

Alex Xu: 30-day collection rate was 85.7% in Q3 versus 87.3% in Q2. C-M2, which represent the outstanding delinquency rate after 30 days collection, increased Q on Q to 0.79% from 0.64%. As overall portfolio risk continued to increase in the last few months, we took additional measures to tighten the risk standard in September and October. While it's still a bit too early to reverse the trend, we start to see marginal improvement in new loans quality. It may take a few more months to see overall portfolio risk improves as the mix of the loans become more favorable. In such a challenging backdrop, we took even more conservative approach to book provisions against potential credit loss.

C <unk>, which represent the outstanding delinquency rate. After 30 days collection increased Q on Q2, 0.79% from <unk>, 64% as overall portfolio risk continue to an increase in the last few months, we took additional measures.

Haisheng Wu: As overall portfolio risk continued to increase in the last few months, we took additional measures to tighten the risk standard in September and October. While it's still a bit too early to reverse the trend, we start to see marginal improvement in new loans' quality. It may take a few more months to see overall portfolio risk improve as the mix of the loans becomes more favorable. In such a challenging backdrop, we took an even more conservative approach to book provisions against potential credit loss. Total new provisions for risk-bearing loans in Q3 were approximately RMB 2.58 billion versus RMB 2.5 billion in Q2, despite lower risk-bearing loan volume Q1, Q2. Provision booking ratio hit another historical high. Right-backs of previous provisions were approximately RMB 785 million in Q3 versus RMB 1.18 billion in Q2.

Tightening the risk standard in September and October well still a bit too early to reverse the trend we start to see marginal improvement in new loans quality.

It may take a few more months to see overall portfolio risk improves as the mix of the loans become more favorable.

In such a challenging backdrop, we took even more conservative approach to book provisions against potential credit loss total new provisions for risk bearing loans in Q3.

Alex Xu: Total new provisions for risk-bearing loans in Q3 were approximately CNY 2.58 billion, versus CNY 2.5 billion in Q2, despite lower risk-bearing loan volume Q on Q. Provision booking ratio hit another historical high. Write-backs of previous provisions were approximately CNY 785 million in Q3 versus CNY 1.18 billion in Q2. Provision coverage ratio, which is defined as total outstanding provisions divided by total outstanding delinquent risk-bearing loan balance between 90 and 180 days, remained near historical high at 613% in Q3. Non-GAAP net profit was CNY 1.51 billion in Q3, compared to CNY 1.85 billion in Q2. Non-GAAP net income per fully diluted ADS was RMB 11.36 in Q3, compared to RMB 13.63 in Q2 and RMB 12.35 a year ago.

Approximately 258 billion versus $2 5 billion in Q2, despite lower risk bearing loan volume Q on Q.

Provision booking ratio hit another historical high.

Add backs, our previous provisions or approximately $785 million in Q3.

Versus 118 billion in Q2 <unk>.

Provision coverage ratio, which is defined as total outstanding provisions divided by total outstanding delinquent risk bearing loan balance between 90, and 180 days remained near historical high at 613% in Q3.

Haisheng Wu: Provision coverage ratio, which is defined as total outstanding provisions divided by total outstanding delinquent risk-bearing loan balance between 90 and 180 days, remained near historical high at 613% in Q3. Non-GAAP net profit was RMB 1.51 billion in Q3 compared to RMB 1.85 billion in Q2. Non-GAAP net income per fully diluted ADS was RMB 11.36 in Q3 compared to RMB 13.63 in Q2, and RMB 12.35 a year ago. At the end of Q3, total outstanding ADS share count was approximately 130.2 million compared to 132.4 million at the end of Q2, and 144.2 million a year ago. Effective tax rate for Q3 was 20.9% compared to our typical ETR of approximately 15%. The higher-than-normal ETR was mainly due to withholding tax provision related to the cash distribution from onshore to offshore.

non-GAAP net profit was 151 billion in Q3 compared to $1 85 billion in Q2.

non-GAAP net income per fully diluted <unk> was 11, three six RMB in Q3 compared to 13.63 in Q2, and 12 point 35, a year ago.

At the end of Q3 total outstanding share count.

Alex Xu: At the end of Q3, total outstanding ADS share count was approximately 130.2 million compared to 132.4 million at the end of Q2 and 144.2 million a year ago. Effective tax rate for Q3 was 20.9% compared to our typical ETR of approximately 15%. The higher than normal ETR was mainly due to withholding tax provision related to the cash distribution from onshore to offshore. With higher contribution from capital-heavy model, our leverage ratio, which is defined as a risk-bearing loan balance divided by shareholders' equity, was 3.0 times in Q3. Still near the low end of historical range. We expect to see leverage ratio fluctuated around this level in the near term.

Approximately $132 million.

Compared to $132 4 million at the end of Q2, and $144 2 million a year ago.

Effective tax rate for Q3 was 29% compared to our typical ETR of approximately 15%.

The higher than normal ETR was mainly due to withholding tax provision related to the cash distribution from onshore to offshore.

With higher contribution from capital heavy model, our leverage ratio, which is defined as a risk bearing loan balance divided by shareholders equity was three <unk>.

Haisheng Wu: With higher contribution from capital-heavy model, our leverage ratio, which is defined as risk-bearing loan balance divided by shareholders' equity, was 3.0x in Q3, still near the low end of historical range. We expect to see leverage ratio fluctuated around this level in the near term. We generate approximately RMB 2.5 billion cash from operation in Q3 compared to RMB 2.62 billion in Q2. Total cash and cash equivalents and short-term investment was RMB 14.35 billion in Q3 compared to RMB 13.34 billion in Q2. Our strong cash flow and financial position should give us sufficient resources to navigate through the challenging environment, and allow us to satisfy the commitment and obligations to the market. We start to execute the $450 million share repurchase program on 1 January.

Hi.

In Q3 still near the low end of historical range, we expect to see leverage ratio fluctuated around this level in the near term.

We generate approximately $2 5 billion cash from operations in Q3 compared to $2 62 billion in Q2.

Alex Xu: We generate approximately CNY 2.5 billion cash from operation in Q3 compared to CNY 2.62 billion in Q2. Total cash and cash equivalents and short-term investment was CNY 14.35 billion in Q3 compared to CNY 13.34 billion in Q2. Our strong cash flow and financial position should give us sufficient resources to navigate through the challenging environment and allow us to satisfy the commitment and obligations to the market. We start to execute the CNY 450 million share repurchase program in 1 January. As of 18 November 2025, we had, in aggregate, purchased approximately 7.3 million ADSs in the open market for the total amount of approximately CNY 281 million, inclusive of the commissions, at the average price of $38.7 per ADS.

Total cash and cash equivalents and short term investments was 14.35 billion in Q3 compared to $13 three 4 billion in Q2.

Our strong cash flow and our financial position should give us sufficient resources to navigate through the challenging environment and allow us to satisfy the commitments and obligations to the market.

We started to execute the $450 million share repurchase program in January one.

As of November 18th 2025, we had in aggregate purchased approximately seven three.

Haisheng Wu: As of 18 November 2025, we had in aggregate purchased approximately 7.3 million ADSs in the open market for the total amount of approximately RMB 281 million, inclusive of commissions, at the average price of $38.7 per ADS. We intend to resume the repurchase program after the window opens after this earnings call. Finally, regarding our business outlook, given the persistent economic uncertainty and fast-changing market dynamic, we will continue to take a cautious approach in business planning for the next couple of quarters, focusing on risk control of our operation. For the fourth quarter of 2025, the company expects to generate non-GAAP net income between RMB 1 billion and 1.2 billion. This outlook reflects the company's current and preliminary view, which is subject to material changes. With that, I would like to conclude our prepared remarks. Operator, we can now take some questions. Thank you.

$3 million access in the open market for the total amount of approximately $281 million.

Inclusive of commissions and the average price of $38 seven the U S dollar per avs.

We intend to resume the repurchase program after the window opened after this earnings call.

Alex Xu: We intend to resume the repurchase program after the window opened after this earnings call. Finally, regarding our business outlook. Given the persistent economic uncertainty and fast-changing market dynamic, we will continue to take cautious approach in business planning for the next couple quarters, focusing on risk control of our operation. For Q4 2025, the company expect to generate non-GAAP net income between CNY 1 billion and CNY 1.2 billion. This outlook reflects the company's current and preliminary view, which is subject to material changes. With that, I would like to conclude our prepared remarks. Operator, we can now take some questions.

Finally regarding our business.

Given the persistent economic uncertainty and fast changing market dynamic we will continue to take cautious approach in business planning for the next couple of quarters, focusing on risk control of our operation for.

For the fourth quarter of 2025, the company expect to generate non-GAAP net income between 1 billion and $1 2 billion.

This outlook reflects the company's current and preliminary view, which is subject to material changes.

With that I would like to conclude our prepared remarks, operator, we can now take some questions.

Okay.

Thank you if you wish to ask a question. Please press Star then one on your telephone and wait for your name to be announced if you wish to cancel your request. Please press star two and if you are on speakerphone. Please pick up your handset before asking your question.

Operator: Thank you. If you wish to ask a question, please press star then 1 on your telephone and wait for your name to be announced. If you wish to cancel your request, please press star 2, and if you are on a speakerphone, please pick up your handset before asking your question. For those who can speak Chinese, please start your question in Chinese, followed by English translation. To allow enough time to address everyone on the call, please keep it to 1 question and 1 follow-up and return to the queue if you have more questions. Thank you. Your first question today comes from Qiao Huang from Morgan Stanley. Please go ahead.

Haisheng Wu: If you wish to ask a question, please press star then one on your telephone and wait for your name to be announced. If you wish to cancel your request, please press star two, and if you are on a speakerphone, please pick up your handset before asking your question. For those who can speak Chinese, please start your question in Chinese followed by English translation. To allow enough time to address everyone on the call, please keep it to one question and one follow-up, and return to the queue if you have more questions. Thank you. Your first question today comes from Qiao Huang from Morgan Stanley. Please go ahead. 好的，我是管理层的王思义，我是金万的理事会。我想先请教一下监管方面的问题，就是这一套新规的落地，我们对于这个对业务的灵活性会有什么样的改变？也想请教一下管理层对2026年。 Qiao, we can't hear you clearly. 听不清楚。哈喽，可以听到吗？请问可以听到吗？可以，现在可以。好的，行。我想先请教一下关于这个住贷新规落地之后对业务盈利模式会有什么变化？那么在此基础之上，管理层对这个26年的take rate有什么样的预期？如果再展望长一点的话，我们觉得常态化水平之后贷款的这个利润率水平大概在什么位置？这是第一个。第二个问题也是想请教关于这个住贷新规生效之后管理层如何看待行业竞争格局。 Basically, two questions from me.

For those who can speak Chinese please start your question in Chinese followed by English translation.

To allow enough time to address everyone on the call. Please keep it to one question and one follow up and return to the queue. If you have more questions.

Thank you.

Your first question today comes from <unk> Wang from Morgan Stanley. Please go ahead.

Okay.

Its a nuance.

Yes.

<unk>.

I mean.

Karen Ji: Qiao, we can't hear you clearly.

Okay.

Sure.

Okay.

It sounds good.

Alright.

Yes, we can.

Clearly Tim potential.

Yes.

Okay.

Qiao Huang: Hello. Basically, two question from me. One is the, after the new loan facilitation coming to effect in October, how should the management think about the a change to the the business model or population model of the loans? What's the expectation for the take rate in 2026? Maybe, over the long run, how should we think about the loan economics when they normalize? Number two is, how do management think about the competitive landscape after the loan facilitation rule take effect? Thank you.

Okay got it thank you guys.

Why do you think that's what I think will not be sold.

More simply awesome.

That's what I'm getting at.

The takeaway here.

So without that onetime gain.

That means the whole pipeline I think <unk> been back so I'm always existed.

Yeah. Thanks, Jonathan why don't you think that's what I see.

Why do you think you will come back.

So basically two questions from me one is after the new loan facilitation and coming to effect.

Haisheng Wu: One is after the new loan facilitation coming to effect in October, how should the management think about the change to the business model or population model of the loans? What's the expectation for the take rate in 2026? Maybe over the long run, how should we think about the loan economics when they normalize? Number two is how does management think about the competitive landscape after the loan facilitation rules take effect? Thank you. Thank you, Qiao. In terms of regulation and take rates, with the new rules in place, both the loan facilitation space and the broader consumer finance industry will need some time to adjust. In the near term, the rules will have some impact on market size, risk levels, and profitability. This is for sure.

October how should the management think about the <unk>.

A change to the business model are populated model off the loan and whats the expectation for the take rate in 2026, and maybe over the long run how should we think about the long economics when the normalized.

Number two is our.

I would imagine we think about the competitive landscape after the.

Loan facilitation rules taking effect. Thank you.

Okay. Thank you.

And then in terms of regulation.

Alex Xu: Okay. Thank you, Qiao. In terms of regulation and take rate, with the new rules in place, both on loan facilitation space and the broader consumer finance industry will need some time to adjust. In near term, the rules will have some impact on market size, risk levels, and profitability. This is for sure. In the long run, we believe the competitive environment will become more sustainable and healthier, which is good to our industry. As for the near-term impact, let me talk about what we are seeing right now. First, as the entire industry is lifting the risk bar, funding capacity for our SE and referral businesses will come down. This means some users will no longer be served. This will have some impact on our loan volume.

Great.

With the new rules in place both on loan facilitation space then.

The broader consumer finance industry needs some time to adjust.

Near term the roof will have some impact on the market.

Risk levels and profitability.

This is for sure.

And in the long run we believe the competitive environment will become more sustainable or healthier reached good shower industry.

Haisheng Wu: In the long run, we believe the competitive environment will become more sustainable and healthier, which is good to our industry. As for the near-term impact, let me talk about what we are seeing right now. First, as the entire industry is lifting the risk bar, funding capacity for our ICE and referral businesses will come down. This means some users will no longer be served, and this will have some impact on our loan volume. For the rest of ICE business, as we adjust pricing, the take rate will decline. Also, on the positive side, we expect to see better conversion, higher loan amounts, and less early repayments. This will help reduce some of the pressure on the net take rate. Second, the liquidity pressure in the market is pushing overall risk higher for the broader consumer finance space.

As for the near term impact, let me talk about what we are seeing right now.

First and the entire industry is lifting the risk bar.

Funding capacity for our IC and referral business will come down.

This means some users.

Longer Buford.

And this will have some impact on our loan volume.

For the rest of advisory business.

We adjusted pricing.

Alex Xu: For the rest of SE business, as we adjust pricing, the take rates will decline. On a positive side, we expect to see better conversion, higher loan amounts, and less early repayments. This will help reduce some of the pressure on the net take rate. Second, the liquidity pressure in the market is pushing overall risk higher for the broader consumer finance space. Our C-M2 was up to 0.79% in Q3 from 0.64% in Q2, and net provisions were up about 36% compared to Q2. We expect this trend to continue at least in the next 1 or 2 quarters. Based on our Q4 guidance, we are roughly talking about a take rate of 3% to 4% because of pricing and risk impact.

The rates were declining.

Both on the positive side of it.

We expect to see better conversion higher loan amount.

Less early repayment.

This will help you reduce some of the pressure on the net.

Net take rate.

Secondly, the liquidity pressure in the market pushing overall risk higher for the broader consumer finance.

Our <unk> was up two 0.79% in Q3 from zero point.

Haisheng Wu: Our C-M2 was up to 0.79% in Q3 from 0.64% in Q2, and net provisions were up about 36% compared to Q2. We expect this trend to continue at least in the next one or two quarters. Based on our Q4 guidance, we are roughly talking about a take rate of 3% to 4% because of pricing and risk impact. Over the next two quarters, we expect the industry to remain volatile, and we are still trying to get a better understanding on our take rate floor in the new loan. For 2026 and beyond, the take rate will depend on how things evolve from the Q4 baseline. Specifically, our focus will be a few things. First, we will continue to optimize our risk strategies and improve collection efficiency to enhance our risk performance. Second, we will further optimize costs in user acquisition and operations to improve overall efficiency.

<unk>, 4% in Q2.

Net provisions were up about.

36% compared to Q2.

We expect this trend to continue at least in the next one or two quarters.

Based on our Q4 guidance.

Roughly talking about take rate.

3% to 4% because of pricing and the rift impact.

Over the next two quarters.

The industry to remain.

Alex Xu: Over the next 2 quarters, we expect the industry to remain volatile, we are still trying to get a better understanding on our take rate flow in the new loan. For 2026 and beyond, the take rate will depend on how things evolve from the Q4 baseline. Specifically, our focus will be a few things. First, we will continue to optimize our risk strategies, improve collection efficiency to enhance our risk performance. Second, we will further optimize costs in user acquisition, operations to improve overall efficiency. Third, we will also explore some new service offerings to further improve user conversion and retention. We hope these efforts could help improve our take rate over time.

Volatile and we don't try and should get a better understanding and now <unk> brought in a new loan.

For time to trying to fix.

Beyond.

The take rate will depend on how things evolve from the Q4 baseline.

Specifically, our full course.

He will be a few things.

First we will continue to optimize our risk strategies and improved collection efficiency to enhance our risk performance.

Performance.

Secondly, we will further optimize cost and user acquisition and operations to improve overall efficiency.

Third.

We will also explore some new service offerings to further improve user conversion and retention.

Haisheng Wu: Third, we will also explore some new service offerings to further improve user conversion and retention. We hope these efforts could help improve our take rate over time. For your second question, for the competitive landscape, since the new rules came out in April, we have seen a major shakeout in the high-pricing segment. New loan volumes in that market decreased a lot. Some smaller platforms may not survive in the future. The rest of the platforms are also shrinking their loan books. Entering Q4, we are actually seeing less competition for traffic. Looking ahead, some of the platforms currently operating in the high-pricing segment may also try to move into the 18% to 24% range. It is very difficult for them to be profitable in that band, given their disadvantage in funding, risk management, and operation efficiency.

We hope this effort could help improve our kindred overtime.

And then for your second question.

Four.

Alex Xu: For your second question, for the competitive landscape, since the new rules came out in April, we have seen a major shakeup in the high pricing segment. New loan volumes in that market decreased a lot. Some smaller platform may not survive in the future. The rest of the platform are also shrinking their loan book. Entering Q4, we are actually seeing less competition for traffic. Looking ahead, some of the platform currently operating in high pricing segment may also try to move into the 18% to 24% range. It is very difficult for them to be profitable in that band, given their disadvantage in funding risk management and operation efficiency. In longer term, we think some of these players will eventually leave the market. We think that the market consolidation will benefit us in a few ways.

For the competitive landscape.

Since the new rules came out in April we have seen a major shakeup in a high price pricing segment.

New loan volume in that market decreased a lot.

Some smaller plan from may not survive in the future.

The rest of the platform are also shrinking their loan book.

So entering Q4, we are actually seeing less competition for traffic.

Looking ahead some of the platform currently operating in high pricing segment May also tried to move into the 18% to 24% range.

But it is very difficult for them to be profitable in that band.

Given they're disadvantageous in funding risk management and operational efficiency.

In longer term, we think some of the players will eventually leave the market.

Haisheng Wu: In the longer term, we think some of these players will eventually leave the market. We think that market consolidation will benefit us in a few ways. With fewer smaller platforms competing for traffic, our marketing efforts will be more effective. We can acquire higher-value users more accurately with lower acquisition costs. In a new market environment, as users' multi-borrowing situation improves, we should be able to expect lower credit risk and a better conversion rate. As such, users' lifetime value will improve in the longer term. Overall, we think the longer-term competitive environment will become more in our favor, and we see room to take more market shares over time. Thank you. Thank you. Your next question comes from Lincoln Yu at JP Morgan. Please go ahead. 好的，好的，感谢管理层给我这个提问的机会，然后我想询问一下关于股东回报方面的问题。也是因为近期我们看到因为政策或者宏观一系列影响，我们股价有一所波动，所以公司现在想请问一下公司现在的一个股份回购的方案的执行方面会不会有什么变化。因为我看到就是截止到现在，我们其实450 million的plan其实还有170 million左右还没有开展。然后另外的话，长期来看的话，公司对于股东回报是怎样的一个考虑。 Okay, I'll translate my question. My question is on shareholder return.

Yes.

We think that the market the consolidation benefits in a few ways.

With fewer a smaller platform continuing for traffic our market marketing efforts, whether it be more effective.

Alex Xu: With fewer smaller platforms competing for traffic, our marketing efforts will be more effective. We can acquire higher value users more accurately with lower acquisition costs. In a new market environment, as users multi-borrowing situation improves, we should be able to expect lower credit risk and a better conversion rate. As such, users lifetime value will improve in the longer term. Overall, we think the longer-term competitive environments will become more in our favor, and we see room to take more market shares over time. Thank you.

We can acquire higher value users more accurately with lower acquisition costs.

And the new market environment. These are a small team borrowings titration improve.

We should be able to expect lower credit risk in the bedroom commensurate.

As such users' lifetime value will improve and the longer term.

So overall, we think the longer term competitive environment will become more and now in favor.

And we see room to take more market share so more time.

Thank you.

Thank you. Your next question comes from Lincoln You at J P. Morgan.

Operator: Thank you. Your next question comes from Lincoln Yu at JPMorgan. Please go ahead.

Please go ahead.

Consequently, although it took a few minutes you pointed a hull Lasalle Southern California could only bought from another tier.

Lincoln Yu: 好的。感谢冠宇先生给我这个提问的机会，我想询问下关于股东回报方面的问题，也是因为近期我们看到因为政策或者宏观一系列影响，我们股价有所波动，所以想请问一下公司现在的股份回购方案的执行方面会不会有什么变化？因为我看到截止到现在，我们其实$450 million的plan，其实还有$170 million左右还没有开展。然后另外的话，长期来看的话，公司对于股东回报是怎样的一个考虑？Okay, I'll translate my questions.

<unk> hotel, when you select and Helman Cotai you saw portal.

It also sounds like downtown Minneapolis.

We're going to find the truth Sinfonia from IBM.

And I'll just should does it also suggests about which are mainly in our plants and how it you bet <unk> milk Hi, John.

Thompson I consider you go don't have balance sheet.

Okay I'll translate my question. So my question is on shareholder return.

Lincoln Yu: My question is on shareholder return. Given the recent share price volatility and the regulatory uncertainties, whether it be any change in the company's execution of the existing buyback plans. As I see, we still have about like CNY 170 million remaining from the plan announced like in last November. In longer term, what is the company's consideration on shareholder return? Thank you.

The recent share price volatility and the regulatory uncertainties, whether it be entertained and the confidence that execution of the existing buyback plan.

Haisheng Wu: Given the recent share price volatility and the regulatory uncertainties, whether it be any change in the company's execution of the existing buyback plans, as I see, we still have about $170 million remaining from the plan announced in last November. Also, in longer term, what is the company's consideration on shareholder return? Thank you. Okay, Lincoln, I will take this question then. Just like you said, as of now, we still have about $170 million left under our $450 million program designed for this year. We took a temporary pause during the third quarter just given the incoming regulatory update and all the risks associated with that. Now, after today's earnings call, the new window will open in terms of repurchase. We will resume the execution of this program to fulfill our commitment for the rest of the year.

We still have about 170 mailing remaining from the announced like in last November and also in longer term what is the confidence consideration of shareholder return. Thank you.

Okay.

I will take this question and so just.

Alex Xu: Okay, Lincoln, I will take this question then. Just like you said, as of now, we still have about CNY 170 million left under our CNY 450 million program designed for this year. We took a temporary pulse during Q3, just given the incoming regulatory update and all the risk associated with that. Now, after today's earnings call, the new window will open in terms of repurchase. We will resume the execution of this program to fulfill our commitment for the rest of the year.

Just like you said as of now.

We still have about $170 million left under our $450 million program.

Designed for this year.

And we took a temporary pause during the third quarter, just given the incoming regulatory update and all the risk associated with that.

Now.

After today's earnings call the new.

Window will open in terms of repurchase we will resume.

The.

The execution of this.

<unk>.

Program.

Fulfill our commitment.

Yeah.

For the rest of the year and then regarding the dividend.

Haisheng Wu: Regarding the dividends, we have been stated that our goal is to gradually increase dividend per ADS through each semi-annual kind of a dividend payout. Right now, the board-approved dividend payout ratio is 20% to 30%, which still gives us enough room to maintain that kind of a progressive dividend trend even with the volatile kind of earnings movement for the next few quarters there. Eventually, we still aim to achieve that progressive dividend target for the foreseeable future. In the long run, we still put the shareholder return as one of the top priorities for this company, although the mix between the buyback and dividend payout may change from time to time depending on the situation that we are facing at any given time. Okay, thank you. Thank you. Your next question comes from Alex Yee at UBS. Please go ahead.

Alex Xu: Regarding the dividend, we have been stated that our goal is to gradually increase dividend per ADS through each semi-annual dividend payout. Right now, the board approved dividend payout ratio is 20% to 30%, which still give us enough room to maintain that kind of a progressive dividend trend, even with the volatile earnings movement for the next few quarters. Eventually, we still aim to achieve that progressive dividend target for the foreseeable future. In the long run, we still put the shareholder return as one of the top priorities for this company.

We have been.

Stated that our goal is to gradually increase our dividend per avs.

Sure.

Through each semi annual kind of a dividend payout.

And right now.

Board approved a dividend payout ratio is 20% to 30%.

Which still gives us enough room.

Two maintained kind of that kind of.

Progressive dividend trend, even with volatile kind of earnings movement.

For the next few quarters there.

Eventually we still aim to achieve that progressive dividend target for the for the foreseeable future.

In the long run we still put the shareholder return as the one of the top priorities for this company.

Although the mix between the.

The buyback and dividend payout may change.

Alex Xu: Although the mix between the buyback and dividend payout may change from time to time, depend on the situation that we are facing at any given time. Okay. Thank you.

Change from time to time depend on the situation that we're facing at any given time okay.

Thank you.

Thank you. Your next question comes from Alex <unk> at UBS. Please go ahead.

Operator: Thank you. Your next question comes from Alex Ye at UBS. Please go ahead.

Oh go ahead.

<unk> had a hole.

Alex Ye: 感谢给我这个提问的机会，这个问题主要关于资产质量的，想请问一下十月到十一月月度的变化趋势，如何对比三季度，目前有看到加速恶化的趋势吗？假如说监管这边我们预期没有新的变化的话，那目前预期资产质量在什么时候能够有一个见顶的回落，有可能有哪些因素会导致这个时间点，比如说有哪些 upside 或者 downside 的风险。My question is regarding the asset quality trend.

Haisheng Wu: 好，关于感谢给我这个提问的机会，然后这个问题主要关于资产质量的。想请问一下这个10月到11月可能月度的一个变化趋势如何，对比三季度目前有看到加速恶化的一个趋势吗？然后假如说监管这边我们预期没有新的一些变化的话，那管理层目前预期资产质量在什么时候能够有一个见顶的回落，然后有可能有哪些因素会可能导致这个时间点或者这个比如说有哪些upside或者downside的一些风险吧。 So my question is regarding the asset quality trend, so just wondering how has been the monthly trend for October and September and November? Have we seen any accelerated deterioration versus Q3? Assuming there's no further change in regulatory framework, when does management expect the asset quality to stabilize and peak? What are the upside or downside we should be aware of? Thank you. 好的，我先用中文回答，然后请我们同事帮忙翻译一下。10月初的新规落地以后，高定价的资金供给进一步的有一些收缩，加上三季度以来整个行业都处于风险上升的一个趋势，所以无论是哪个定价区间的平台，近期都会以风控为首要的任务，会收紧风控政策，而这会进一步的加剧了行业流动性的问题，导致行业整体风险会进一步的提升。我们在11月份我们也看到一些好的变化，一块是新增资产的早期风险表现已经有逐步企稳且好转的迹象。我们看到7月的新放款FPD7预期率指标相较7月已经有了一个8%的下降。从存量的资产风险表现来看，11月份已经有表现的7天预期率和10月相比，目前来看也是基本持平的。 Let me do the translation. Since the new rules started to take effect on 1 October 2023, high-cost fundings have tightened further. At the same time, industry risk levels have been going up in Q3. Pretty much all platforms, no matter the price level, have made risk management first and tightened their risk policies. This has made liquidity even tighter and pushed over risk levels further up. We are also seeing some positive signs in November.

I need to have.

Thank you.

So you could see here.

Can I go to the balance sheet.

Maybe if I need to cancel.

Council aligning in Houston.

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So a lot of timberlands a gentleman you may have seen there's been a lot of Honda.

2007.

So my Sonangol attended.

Now you're kind of human nature, Gainesville, I Couldnt answer that.

So Jim Dan.

It was really a nice upside for that outside Asia.

So my question is regarding the asset quality.

Trend. So just wondering how has been the trend.

Alex Ye: Just wondering how has been the trend, monthly trend for October and September and November? Have we seen any rated deterioration in versus Q3? Assuming there's no further change in regulatory framework, when does management expect the asset quality to stabilize and peak? What are the upside or downside we should be aware of? Thank you.

Monthly trends for October and September.

November half have we seen any.

Richard deterioration versus Q3, and assuming there's no further change.

Change in regulatory framework.

When does management expect the liquidity to stabilize at peak.

Outside with outside we should be aware of thank you.

We're seeing a little bit.

Thank you.

Yan Zheng: 十月，就在新规落地以后，高定价的资金供给进一步有一些收缩，加上三季度以来，整个行业都处于风险上升的一个趋势，所以无论是哪个定价区间的平台，近期都会以风控为首要的任务，会收紧风控政策，而这会进一步加剧行业流动性的问题，导致行业整体风险会进一步提升。但同时，我们在十一月份也看到一些好的变化，一块是新增资产的早期风险表现已经有逐步企稳且好转的迹象。我们看到十一月的新放款FPD7逾期率指标相较七月已经有了8%的下降。从存量的资产风险表现来看，十一月份已经有表现的七天逾期率，和十月相比，目前来看也是基本上持平的。

Yes.

Even with the economy.

Yes, so first of all.

Thank you Lee.

Yeah totally.

Thanks Linda.

Oh, sorry.

Hey, Jonathan Hi, Keith in Kuwait for the other known.

Thanks.

I typically see gotcha.

Yes.

Thank you Cynthia.

The key for the kitchen.

Nielsen.

Hello, John.

Sure.

Good morning, Ken.

Sure.

When the kind of key Keystone pvt.

Thanks, Joe Bob.

Bob.

Yes.

Going back to my comments, Steve you said <unk>.

Yes Sandy.

Hi.

Yes.

Okay.

Let me, let me do the translation.

Karen Ji: Let me do the translation. Since the new rules started to take effect on 1 October, high cost fundings have tightened further. At the same time, industry risk levels have been going up in Q3. Pretty much all platforms, no matter the price level, have made risk management first and tighten their risk policies. This has made liquidity even tighter and pushed over risk levels further up. We are also seeing some positive signs in November. The early risk indicators of new loans are showing signs of stabilization and slight improvement. The FPD7 delinquency rate for new loans in September decreased by 8% compared to that of July. In terms of the risk performance of overall loan portfolio, the 7-day delinquency rate observed in November has remained broadly slight compared to October, with no further upward trend.

The New York.

Is that October 1st Hi, corresponding have tightened.

At the same time.

Industry rate levels have been going up in Q3.

So pretty much all platform no matter the price level.

Asset.

Management first tightened risk policy.

This has made liquidity even tighter.

Post <unk>.

Our rate levels.

But we are also seeing some positive signs in Orlando.

The early indicators of new loans are showing signs of stabilization or slight improvement.

Haisheng Wu: The early risk indicators of new loans are showing signs of stabilization and slight improvement. The FPD7 delinquency rate for new loans in September decreased by 8% compared to that of July. In terms of the risk performance of overall loan portfolio, the seven-day delinquency rate observed in November has remained broadly flat compared to October, with no further upward trend. 目前我们在压降风险的政策上面主要体现在两个方面。一块是在投放侧以及债权带中的策略上，我们适度提升了优质用户的一个占比，优化整体资产包的风险结构。此外，我们在加大对于低风险用户的场域资源的一些投入，使用大模型统筹算法优化定价，通过精准的定价加上独有的资产权益，再加上简约的对客表达，提升优质客户的转化及流程。第二是在催收方面，我们增加了自营资源的能力建设，对合作催收机构加大资源投放，吸引更多的优质坐席。我们也对客户进行了差异化的分群，进行精细化的能按匹配，也利用大模型算法能力对客户还款行为进行意图识别，判断客户还款能力和意愿，动态去调整了客户的分群，灵活快速地做了一些换手的动作，最大化催收效能。 Right now, we mainly focus on two areas to lower risk. For pre- and in-loan processes, we are moderately increasing the share of high-quality users to optimize overall risk structure. We are also increasing operation resources for low-risk users, and use large language model algorithms to improve pricing. With more tailored pricing, exclusive benefits, and a simpler user journey, we intend to improve user conversion and retention. For collection, we are adding more in-house capacity and increasing support for our partner agencies.

To ask TD seven delinquency rate on new loans in September.

Decreased by 8% compared to that of July.

In terms of the risk performance of overall loan portfolio. The seven day delinquency rate observed in November.

Remained broadly flat compared to October with no further upward trend.

Most of the women.

Yan Zheng: 目前我们在压降风险的政策上面，主要体现在两个方面。一块是在投放侧以及贷前贷中的策略上，我们适度提升了优质用户的占比，优化整体资产包的风险结构。此外，我们在加大对于低风险用户的场景资源的投入，使用大模型统筹算法，优化定价，通过精准的定价，加上独有的资产权益，再加上简约的对客表达，提升优质客户的转化及流程。第二在催收方面，我们增加了自营资源的能力建设，对合作催收机构加大资源投放，吸引更多的优质座席。我们也对客户进行了差异化的分群，进行精细化的冷案匹配，也利用大模型算法能力对客户还款行为进行意图识别，判断客户还款能力和意愿，动态去调整了客户的分群，灵活快速地做一些换手的动作，最大化催收效能。

So thank you Amit.

This is our telephones.

Okay.

Well Mr. <unk>. Thank you.

Thank you Sandy.

Thank you Keith.

Okay.

So that one day.

Got that.

Yes.

John Thomas interim tolls somehow Johan.

Towards and John John just real quick.

So Jonathan if you could go back to you soon.

Mr cohort.

Okay.

Yes, it's actually not.

Well then in Dallas, and then the new cancer.

Thank you Joe.

So back to your telephone keypad.

EMEA three cohorts, even a tiny part of Vinci Steven Thank you for the demand.

Yeah, Neil Thomas and sometimes I need a cool summer.

TCE for CBS.

Okay.

Sometimes she tells them cope with essentially equal HIFU.

So thanks for that.

Sure.

Hello Simon.

Yes.

So right now we mainly focus on two areas to lower rates.

Karen Ji: Right now we mainly focus on 2 areas to lower risk. For pre and in loan processes, we are modestly increasing the share of high quality users to optimize overall risk structure. We are also increasing operation resources for low risk users and use large language model algorithms to improve pricing. With more tailored pricing, exclusive benefits, and a simpler user journey, we intend to improve user conversion and retention. For collection, we are adding more in-house capacity and increasing support for our partner agencies. We are also improving how we profile users and match cases so each case can go to the right team. Powered by large language algorithms, we can now get a better read on borrower's ability and willingness to repay. Adjusting their grouping and tailor our approach to drive better collection results.

And even on processes, we have modest increase in the share of high quality care to optimize overall rate structure.

We're also increasing operation results as follows.

And his last language model algorithms to improve I think.

With Martinez pricing exclusive benefits and a simple user journey, we intend to improve user conversion.

Yes.

So collection.

Adding more in house capacity and increasing support for our partner agencies.

We are also improving our profile users at match group.

Haisheng Wu: We are also improving how we profile users and match cases, so each case can go to the right team. Powered by large language algorithms, we can now get a better read on borrowers' ability and willingness to repay, adjusting their grouping, and tailor our approach to drive better collection results. 说到未来的展望，虽然我们在最近看到诸多指标企稳转好，但11月份的表现时间还是比较短的，还需要进一步的观察。我们的借款周期一般是在9到10个月，因此通过优化新放款的风险策略，通常需要两到三个季度的时间来改善整个资产包的结构，实现大盘风险的改善。但是行业环境一直发生很多新的变化，目前我们新放款的早期风险指标还没有压降到我们认为的非常理想的水平，因此这次的风险调整周期可能会比预计的要来得更久一些。但是无论是波贝计提还是业务本身的利润安全垫都是非常充足的，相信我们可以有效地应对行业的短期挑战。过去我们经历了非常多的挑战，每次都应对得比较及时和有效，所以这次我们还是有信心把风险控制在合理的范围内。 Looking ahead, although we have seen some early signs of stabilization, it's only been about two weeks into November, so we will need some more time to tell if the trend will hold. Our loan tenor is usually nine to 10 months, so when we tighten risk stretches for new loans, it usually takes two to three quarters for the improvements to show up in the overall portfolio.

Yes.

So each case can go to a direct team.

Okay.

Well <unk>.

Adjusting their group and tailor our approach to Chad.

Actually Paul.

Okay.

That's not long.

Thank you Jim.

Yan Zheng: 说到未来的展望，虽然我们在最近看到诸多指标企稳转好，但十一月份的表现时间还是比较短的，还需要进一步的观察。我们的借款周期一般是在九到十个月，因此呢，通过优化新放款的风险策略，通常需要两到三个季度的时间来改善整个资产包的结构，实现大盘风险的改善。但是行业环境一直发生很多新的变化，目前我们新放款的早期风险指标还没有压降到我们认为的最理想的水平，因此这次的风险调整周期可能会比预计的要来得更久一些。但是无论是拨备计提还是业务本身的利润，安全垫都是非常充足的，相信我们可以有效地应对行业的短期挑战。过去我们经历了非常多的挑战，每次都应对得比较及时和有效，所以这次我们还是有信心把风险控制在合理的范围内。

All humans.

Thanks Mimi.

Thanks again.

Hi, Scott.

Well, then that's too high so keybank today, so now dominion.

Thank you Simone.

Youll see some kind of solution.

Thanks again guys.

So listen about a year ago.

Thank you.

Yes.

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Hi, Neely.

Well no.

200 <unk>.

So the funding in 2013.

Your line is open.

We don't think will be key as he opens and the need to actually deal with.

Just as soon as we do that.

Thank you Ron Mccray.

How's that.

Maintaining a free handle that tells that makes it all.

And then it began.

Yeah.

Yossi.

Kudos on hernia.

Okay.

So looking at that although we have seen some early signs of stabilization is only be about two weeks in November so we will need some more time to tell.

Karen Ji: Looking ahead, although we have seen some early signs of stabilization, it's only been about 2 weeks into November, so we will need some more time to tell if the trend will hold. Our loan tenure is usually 9 to 10 months, so when we tighten risk strategies for new loans, it usually takes 2 to 3 quarters for the improvements to show up in the overall portfolio. The market dynamic is still evolving, and the leading risk indicators for new loans haven't been down to our desired levels yet. This adjustment cycle will likely take a bit longer than we expected. On the financial side, our provisions and profit buffer of our business are both very solid. This gives us plenty of room to manage through the short term industry happening. We have been through many challenges before, and each time we were able to respond quickly and effectively. We are confident we can bring risk levels back to a reasonable range once again.

Our loan tenor is usually nine to 10 months. So when we tightened it stretches fund new loans. It usually take two to three quarters, while the improvements to show up in the overall portfolio.

The market dynamic is evolving and the leading indicators for new loans haven't been down to our desired level yet.

Haisheng Wu: The market dynamic is still evolving, and the leading risk indicators for new loans haven't been down to our desired levels yet, so this adjustment cycle will likely take a bit longer than we expected. On the financial side, our provisions and profit buffer of our business are both very solid. This gives us plenty of room to manage through the short-term industry headwinds. We have been through many challenges before, and each time we were able to respond quickly and effectively, so we are confident we can bring risk levels back to a reasonable range once again. The next question comes from Emmitsu at BofA Securities. Please go ahead. 监管的问题就是最近有媒体报道称，监管机构正在研究针对消费金融公司的新规，拟将新发放贷款的平均年化利率下调到20%。虽然这个新规不适用于住贷公司，但想请问一下管理层是否评估过，如果平均的这个APR降至20以下可能带来的影响，这是否会导致贷款增长放缓及信贷成本上升？在这种情况下，公司有没有任何对冲措施以缓解对盈利的影响？那我翻译一下我的提问。 According to recent media reports, regulators are starting new regulations for consumer finance companies that will lower the APR of newly issued loans to 20%.

So is adjustment cycle will likely take longer.

That takes.

On the financial side, our probation and profit.

Of our business are both very solid.

This gives us plenty of room to manage through the short term industry headwinds.

We have been through many challenges before and each time, we were able to respond quickly and effectively.

We are confident we can bring great levels back to a reasonable range once again.

Okay.

Thanks, Operator next question comes from <unk> <unk>.

Operator: Thank you. The next question comes from Emma Xu at BofA Securities. Please go ahead.

<unk> Securities.

Please go ahead.

Your line.

J D O <unk> Io trial.

Emma Xu: 监管的问题就是最近有媒体报道称，监管机构正在研究针对消费金融公司的新规，拟将新发放贷款的平均年化利率下调到20%。虽然这个新规不适用于助贷公司，但想请问一下管理层是否评估过，如果平均的这个APR降至20%以下可能带来的影响，这是否会导致贷款增长放缓及信贷成本上升？在这种情况下，公司有没有任何对冲措施以缓解对盈利的影响？那我翻译一下我的提问。

And then Diane GA and <unk> all go into.

They've been great.

Currency impact on that kind of changing your IBD dunhill.

Josh <unk> neutral angle here, Congrats you raise Atlanta comfortable keen Google will go up in general about API downstream.

Yeah.

Laid out you guys had done some black tea bags from Brighthouse, Joe Thank you Jean Jacques.

Oh, Yes, <unk>, yes.

Now, we're saying now is excellent.

According to recent media reports regulators as savvy, new regulation for consumer Finance company that will lower the APR.

Cindy Wang: According to recent media reports, regulators are starting new regulations for consumer finance companies that will lower the APR of newly issued loans to 20%. Although these regulations will not apply to loan facilitation firms, has the management evaluated the potential implication if the average APR will fall to below 20%? Could this lead to a slowdown in loan growth and an increase in credit cost? In such a scenario, does the company have any measures in place to hedge against that impact on profitability?

<unk> issue drove strategic percent. Although these regulations will not apply to adult litigation funds has the management evaluated the potential implication if the average APR workforce, we will get about 20%.

Haisheng Wu: Although these regulations will not apply to loan facilitation firms, has the management evaluated the potential implications if the average APR will fall to below 20%? Could this lead to a slowdown in loan growth and an increase in credit costs? In such a scenario, does the company have any measures in place to hedge against the impact on profitability? Okay, okay, Emma, let me take this one. Yes, on the pricing guidance for consumer finance companies, there's no formal document at this point, just informal communication. As we understand, consumer finance companies are required to keep their average pricing below 20%. We think the logic behind this is quite close to the new rules on the loan facilitation sector, as the regulator's intention is also to reduce the borrowing costs for consumers and make credit more accessible.

Please be to slow down in loan growth and an increase in credit cost in such a scenario. The company has any measures in place to hedge against that impact on profitability.

Okay. Okay, let me take this one.

Alex Xu: Okay. Okay, Emma, let me take this one. On the pricing guidance for consumer finance companies, there's no formal document at this point, just informal communication. As we understand, consumer finance companies are required to keep their average pricing below 20%. We think the logic behind this is quite close to the new rules on loan facilitation sector. As the regulator's intention is also to reduce the borrowing costs for consumers and make credit more accessible. In the near term, it will have some impact on market size, risk levels and profitability. Over time, we think it will help create healthier competition and improve asset quality. In terms of funding, our direct exposure to consumer finance companies is small. The direct impact on us is limited.

Yes on the pricing guidance for consumer finance companies.

No there is no formal documents.

Point Johnson.

Informal communication.

And we understand consumer finance companies are required to keep their average pricing below 20%.

We think the logic behind this is quite close to the new rules on low fortification sector.

As the regulator was intention is also to reduce the borrowing costs for consumers and mid credit is more accessible.

In the near term, yes, Israel have some impact on market risk level and the profitability.

Haisheng Wu: In the near term, yes, it will have some impact on market size, risk levels, and profitability. Over time, we think it will help create healthier competition and improve asset quality. In terms of funding, our direct exposure to consumer finance companies is small, so the direct impact on us is limited. First, the consumer finance companies source their business from diverse channels. Industry-wide, about 40% of their loans is self-operated, and about 60% from API channels, mostly platform under other internet companies. Our cooperation with them just accounts for a very small part. In terms of funding, they only account for about 15% of our loan mix. Most of our funding comes from banks, so we are flexible to shift our funding structure if needed. As such, we think the direct impact on us is quite limited, but there is indirect impact.

Overtime, we think it will help create healthier competition and improved asset quality.

In terms of funding.

Our direct exposure to consumer finance companies.

Sure.

So the direct impact on us.

Ltd.

First the consumer finance companies, firstly, our business from diverse channel industry.

Alex Xu: The consumer finance companies source their business from diverse channels. Industry-wide, about 40% of their loans is self-operated and about 60% from API channels, mostly platform under other internet companies. Our cooperation with them just accounts for a very small part. In terms of funding, they only account for about 15% of our loan mix. Most of our funding comes from banks, we are flexible to shift our funding structure if needed. We think the direct impact on us is quite limited, there is indirect impact. As consumer finance companies adjust their pricing, we may expect further pressure on liquidity in the short term, leading to risk volatility. We may continue to lift our bars to mitigate the risk. Our average APR in Q3 was 20.9%.

Industry wide.

About 40% of their loans.

Richard.

About 60% from API Shannon.

Mostly platform under other internet companies.

Our cooperation with them just to account for our various from more part.

In terms of funding they only account for about 15% of our loan mix most of our funding comes from banks.

So we are flexible to shift our funding structure if needed.

As such we think the direct impact on math is quite limited.

There is indirect impact.

As consumer consumer finance companies adjust their pricing.

Haisheng Wu: As consumer finance companies adjust their pricing, we may expect further pressure on liquidity in the short term, leading to risk volatility. In that case, we may continue to lift our bar to mitigate the risks. Our average APR in Q3 was 20.9%. Going forward, we need to strengthen our ability to serve higher-quality users with a broader user base and a better mix. We should be able to optimize pricing and keep our risk well-balanced. In the meantime, we will fund our operation to improve overall profitability. The point is we care more about our users' long-term value than short-term profitability. Thank you. Thank you. Your next question comes from Cindy Wang at China Renaissance. Please go ahead. 谢谢管理层给我这个提问的机会。那我这边有两个问题想请问。第一个就是刚才CEO在opening remarks的时候有提到说这个季度金科业务的放款量环比这个超过了200%的一个增长。那可不可以跟我们说一下请问具体的原因是为何，然后以及对未来这个金科业务的一个展望？那第二个的话想请教，因为我们看到第三季capital light大概是占了42%的new loan volume，和第二季度大致上持平，但是loan balance这一块又进一步的下滑到48%。所以可不可以跟我们展望一下，就是说第四季度我们怎么看这个轻重资产的一个比例，以及明年这个业务上面的一个结构的变化，大概轻重资产可能会占怎么样的一个比重？那我很快翻译一下我的问题。 Thanks for taking my call. I have two questions here.

I expect further pressure on liquidity in the short term.

He didn't through risk volatility.

In that case, we may continue to lift our bonds to mitigate the risks.

Our average APR in Q3, it was 29% going forward, we need to strengthen our ability to serve higher quality users.

Alex Xu: Going forward, we need to strengthen our ability to serve higher quality users. With a broader user base and a better mix, we should be able to optimize pricing and keep our risk well-balanced. In the meantime, we'll fine-tune our operation to improve overall profitability. The point is, we care more about our users' long-term value than short-term profitability. Thank you.

With a broader user base.

Better mix.

We should be able to optimize pricing and keep our risked rebalanced.

In the meantime, we will refund.

Our operation in two <unk>.

To improve overall profitability.

We care about we care more about our users' long term value than short term profitability.

Thank you.

Thank you. Your next question comes from Cindy Wang at China Renaissance.

Operator: Thank you. Your next question comes from Cindy Wang at China Renaissance. Please go ahead.

Please go ahead.

Your line is now open the queue ahead to you I would now like that they have a delco Lindsay catching what do you guys as a contestant.

Cindy Wang: Thanks for taking my call. I have two questions here. First, during the opening remarks, CEO mentioned Technology Solutions loan volume up more than 200% quarter over quarter in Q3. What's the main drivers behind it, and what is the outlook of this business? Second, in Q3, capital-light accounted for 42% of the new loan volume, largely the same as Q2, but down 3 percentage points quarter over quarter to 48% of loan balance. How do you expect the ratio of capital-heavy and capital-light business to new loan volume and loan balance in Q4 in 2026? Thank you.

Joining remarks, Sean.

<unk> <unk> Deutsche <unk>.

And can you just talk about that data presented at <unk>.

Goodbye come I'm not sure if that's your lunch.

Uh huh.

Keith will add to that David Catwalks and idea that John Laing.

Capital light.

This is Josh yourself I said Daniel on volume.

I think I did note that it has substantial umbrella to take priority.

Thanks, Bob.

Glenn Coleman, Sam Walsh, Agila shortage digital momentum all kinds of questions on this.

T J.

Yes.

Can you answer that.

This is Joe.

Thank you Charlotte.

For taking my call.

I have two questions here first during the opening remarks, you mentioned technology solutions volume up more than 200% quarter over quarter in Q3.

Haisheng Wu: First, during the opening remarks, CEO mentioned Technology Solutions loan volume up more than 200% quarter over quarter in Q3. What's the main drivers behind it, and what is the outlook of this business? Second, in Q3, capital light accounted for 42% of the new loan volume, largely the same as Q2, but down 3 percentage points quarter over quarter to 48% of loan balance. How do you expect the ratio of capital heavy and capital light business to new loan volume and loan balance in Q4 and 2026? Thank you. Thank you, Cindy. I can take the first one, and Alex, you can take the second one. So far, yes. So far, our Technology Solutions business has partnered with over 20 financial institutions. In Q3, we facilitated around RMB 5.4 billion in loan volume through this model, up 218% quarter on quarter.

The main drivers behind it and what is the outlook of this business.

Yes.

Second in Q3 capital light accounted for 42% of Danielle No volume.

Volume largely the same as Q2, but down.

Percentage point quarter over quarter to 48%. So how do you expect the ratio of capital heavy and capital light.

Business loan volume and loan balance in Q4, and Tony Tony Thanks. Thank you.

Okay.

Cindy I can take take a first run and Alex you can trigger a second one.

Alex Xu: Okay. Okay. Thank you, Cindy. I can take first one, Alex, you can take second one. So far, yes. So far our Technology Solutions business has partnered with over 20 financial institutions. In Q3, we facilitated around RMB 5.4 billion in loan volume through this model, up 218% quarter-on-quarter. The outstanding balance has exceeded RMB 10 billion lately. Two main factors are driving this growth. First, loan volume with our signed partners is steadily ramping up. Second, we are expanding the ways we collaborate with financial institutions. Not only can we facilitate credit business within their ecosystem, but also across a broader set of online scenarios. This really highlights the value we bring in customer acquisition and risk management across diverse channels.

Uh huh.

So far yes, so far our tax solution business has partnered with over 200.

Over 2020 financial institutions in Q3, we facilitated.

Around RMB.

$5 4 billion and low volume through if model.

200, and 218% quarter on quarter.

And the outstanding balance has exceeded RMB 10 billion basically.

Haisheng Wu: The outstanding balance has exceeded RMB 10 billion lately. Two main factors are driving this growth. First, loan volume with our signed partners is steadily ramping up. Second, we are expanding the ways we collaborate with financial institutions. Not only can we facilitate credit business within their ecosystem, but also across a broader set of online scenarios. This really highlights the value we bring in customer acquisition and risk management across diverse channels. We are also seeing strong demand from financial institutions for AI agents. Because of that, our solution is more than technology infrastructure. We are currently upgrading our Focus Pro product into our super credit AI agent. Take our AI Credit Officer as an example. Traditional offline credit products in banks have long, complicated processes.

Two main factors are driving this growth first loan volume with our <unk> partners.

Steadily Remy map.

Second.

We are expanding that.

Collaborate with financial institutions, not only can we facilitate credit business within their ecosystem.

But also across a broader set of online scenario.

This really highlights the value we bring.

In customer acquisition and risk management across diverse channels.

We are also seeing strong demand from financial institutions for AI agent.

Alex Xu: We are also seeing strong demand from financial institutions for AI agents. Our solution is more than technology infrastructure. We are currently upgrading our Focus Pro product into our Super Credit AI agent. Take our AI Credit Officer as an example. Traditional offline credit products in banks have long, complicated processes. Powered by large language model capabilities, AI Credit Officer can use the one single model to handle all kinds of documents processing tasks during due diligence and the credit approval stages. This will streamline the process by removing overlapping models running in parallel. Users do not need to resubmit their materials. The whole process can be accelerated, and the approvals can be completely within the same day.

Because of that our solution is more than technology infrastructure.

We are currently upgrading our <unk> pro product into our Super credit AI agent.

Take our AI credit Officer, then example.

Traditional offline credit impacts have long complicated preventive powered.

Haisheng Wu: Powered by large language model capabilities, AI Credit Officer can use one single model to handle all kinds of document processing tasks during due diligence and the credit approval stages. This will streamline the process by removing overlapping models running in parallel. As a result, users do not need to resubmit their materials. The whole process can be accelerated, and the approvals can be completed within the same day. On the risk assessment side, by leveraging our trailing-level risk decision data set and multi-model large language model technology, the agent can identify risk in seconds, generate more precise user profiles within minutes, and keep iterating based on feedback. In the pilot run with our bank partners, our AI agents are already making an impact in key areas like customer acquisition and approvals. The market feedback has also been very positive.

Hey, I'd credit officer can use the one single model to handle all kinds of documents processing tasks.

During due diligence and credit approval stage.

This will streamline the process by removing overlapping models running in parallel.

As a result users do not need to resubmit their materials.

The whole process can be accelerated and approvals can be completely within the same day.

On the risk assessment side.

Leveraging our drilling.

Alex Xu: On the risk assessment side, by leveraging our trillion-level risk decision data set and multi-model large language model technology, the agent can identify risk in seconds, generate more precise user profiles within minutes, and keep iterating based on feedback. In the pilots run with our bank partners, our AI agents are already making an impact in key areas like customer acquisition and approvals. The market feedback has also been very positive. We are also seeing interest from several other financial institutions in their products. We believe the future upside of our super credit AI agent is very high, huge. Thank you.

Trailing level risk decision.

Data sets and multimodal large language module technology.

The agent can identify risk in second.

January it's more precise user profiles with the minutes.

And to keep Iterating based on feedbacks.

And the pilots run with our bank partners.

The agents are already making an impact in the key areas like customer acquisition and approvals.

The market feedback has also been very positive. We are also seeing interest from February finished.

Financial institution tuitions and their products.

Haisheng Wu: We are also seeing interest from several other financial institutions in their products. We believe the future upside of our super credit AI agent is very huge. Thank you. Cindy, to your second question regarding the mix between cap heavy and cap light, in the short term, as we're facing very volatile kind of market condition that we discussed earlier, we may need to make some flexible adjustments to the mix. On one hand, for example, in this kind of generally higher risk environment, we intend to do more capital light versus capital heavy. On the other hand, the price cap on the 2024 also limited our capability to do the IC side of a business. Those two forces probably will work together in the fourth quarter in particular.

We believe the future upside of our simple credit agents.

Huge.

Thank you.

Cindy.

Second question regarding the mix between heavy and light in that short term as we're facing very.

Alex Xu: Cindy, to your second question regarding the mix between capital-heavy and capital-light. In the short term, as we're facing very volatile kind of market condition, you know, that we discussed earlier, we may need to make some flexible adjustments to the mix. On one hand, for example, in this kind of a generally higher risk environment, we intend to do more capital-light versus capital-heavy, but on the other hand, the price cap on the 24 also limited our capability to do the IC side of a business. You know, those two forces probably will work together, you know, in the Q4 in particular.

Volatile kind of market condition.

You know that we discussed earlier, we may need to make some flexible adjustment to the mix.

One hand for example in these kind of.

Generate higher risk environment, we intend to do more.

Alright.

Capital heavy but on the other hand.

The price cap on the 24 also limited our capability to do.

The IC side of our business. So those two forces probably will work together.

In the fourth quarter in particular, but Directionally I would say you probably will see a little bit more on the capital light side in the fourth quarter.

Alex Xu: Directionally, I would say you probably will see a little bit more on the capital-light side in Q4, and as we intend to reduce the risk exposure. Then the longer term, I think we still need to make from quarter to quarter or time to time, we still need to make timely adjustment based on the conditions we're facing, based on the risk level the market presents, and also based on the funding sources we're getting, to decide at what the best solution or best mix for us in terms of mix. I don't think there will be, at least for the 2026, a directional movement toward the capital-light or toward the capital-heavy.

Haisheng Wu: Directionally, I would say you probably will see a little bit more on the capital light side in the fourth quarter as we intend to reduce the risk exposure. In the longer term, I think we still need to make, from quarter to quarter or time to time, timely adjustments based on the conditions we're facing, based on the risk level the market presents, and also based on the funding sources we're getting to decide what's the best solution or best mix for us in terms of mix. I don't think there will be, at least for 2026, a directional movement toward the light or toward the heavy. It most likely will be sort of bouncing around the 50/50 line throughout the next year. Thank you. Operator. Thank you.

And.

As we intend to reduce our risk exposure.

And then the longer term I think we still need to make.

From quarter to quarter or time to time, we still need to make timely adjustments based on the conditions, we're facing based on the risk level.

The market presents.

And also based on the funding sources, we're getting to decided what.

What's the best solution or best mix.

In terms of mix.

So I don't think there will be a at least for the 2026 I don't think there will be a directional.

Movement.

Towards the light towards the heavy.

Most likely we'll be sort of bouncing around.

Alex Xu: It most likely will be sort of a bouncing around the sort of the 50/50 line throughout the next year. Thank you. Operator?

The sort of the 50 50.

Leigh throughout the next year.

Thank you.

Operator.

Thank you that concludes our question and answer session for today I'd like to hand back for closing remarks. Thank you.

Operator: Thank you. That concludes our question and answer session for today. I'd like to hand back for closing remarks. Thank you.

Haisheng Wu: That concludes our question and answer session for today. I'd like to hand back for closing remarks. Thank you. Okay. Thank you again for everyone to join us for the call. If you have additional questions, please feel free to contact us offline. Thank you. Have a good day. Thank you. Thank you. That does conclude our call for today. You may now disconnect your lines. Thank you.

Okay. Thank you again for everyone for joining us for the call. If you have additional questions. Please feel free to contact us offline. Thank you and have a good day.

Alex Xu: Okay. Thank you again for everyone to join us for the call. If you have additional questions, please feel free to contact us offline. Thank you. Have a good day.

Thanks.

Thank you that does conclude our call for today you may now disconnect your lines. Thank you.

Karen Ji: Thank you.

Operator: Thank you. That does conclude our call for today. You may now disconnect your lines. Thank you.

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