Release Date: May 21, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- FinVolution Group (FINV, Financial) reported a strong financial performance with a 10% year-over-year revenue growth in Q1 2025.
- International transaction volume grew by 36% year over year, contributing significantly to the company's overall growth.
- The company achieved a record-breaking quarterly net profit of RMB738 million, marking a 39% increase year over year.
- FinVolution's international business now contributes 20.4% of total net revenue, up from 18.8% in the same period last year.
- The company onboarded 1.2 million new borrowers in Q1 2025, a 62% increase year over year, demonstrating effective customer acquisition strategies.
Negative Points
- FinVolution Group (FINV) faces ongoing macroeconomic uncertainties, including global trade tensions and evolving regulations in China's consumer finance sector.
- The company experienced seasonal softness in Indonesia due to Ramadan, impacting growth in that market.
- Despite strong performance, sales and marketing expenses rose by 18% year over year, indicating increased costs in acquiring new borrowers.
- The macroeconomic environment in China remains uncertain, with potential impacts on loan application demand and credit performance.
- The company must navigate new regulations on loan facilitation in China, which could impact its business model and operations.
Q & A Highlights
Q: With the recent new regulation on loan facilitation in China, do you see any business impact from it? And what's your basis adjustment for this?
A: Jiayuan Xu, CFO: The new regulation, effective in October, officially includes loan facilitation in China's financial regulatory framework. It promotes industry compliance and benefits leading platforms with strong risk management. The overall impact is manageable and crucial for long-term industry development.
Q: Given the recent US tariff uncertainty, have you seen any impact on the Indonesia or Philippines consumption loan demand since April? And how do you expect the international new loan volume in the second quarter?
A: Tiezheng Li, CEO: Global trade tensions have introduced challenges, but our consumer-focused customers are less affected. Indonesia saw some seasonal softness, but we expect a rebound in Q2. The Philippines had a strong Q1, and we project continued growth in Q2.
Q: What is the loan application demand trend in China in the past two months, and do you plan to tighten credit approval given rising macro uncertainty?
A: Jiayuan Xu, CFO: Loan application demand held steady in April and May, with a slight decline in April and a rebound in May. We are selectively adjusting risk appetite for marginal assets while monitoring macro trends. We remain confident in achieving our full-year revenue growth guidance of 10% to 15%.
Q: What are the drivers for the improved take rate for the China business and the outlook ahead?
A: Jiayuan Xu, CFO: The take rate in China increased by 10 basis points due to improved funding costs and slightly extended loan tenure. Both risk metrics and funding costs are at favorable levels, and we expect them to remain stable, supporting high-quality growth in China.
Q: Can you provide more details on the latest business updates regarding international expansion and guidance for revenue and profit in 2025?
A: Jiayuan Xu, CFO: International transaction volume surpassed RMB3 billion, with a 36% year-over-year increase. We maintain a full-year revenue growth target of 10% to 15%, with international markets expected to contribute 25% of revenue. Indonesia and the Philippines are projected to generate a minimum net profit of $10 million in 2025.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
