LexinFintech Holdings Ltd. Q4 FY2025 earnings call

1. Adjusted business structure under new rules in fourth quarter, used users as center, optimized product governance and service experience, strictly operated within new rules framework. 2. Strengthened risk management: Optimized risk strategy, improved new asset risk indicators, focused on precision operation of high-quality assets in storage assets. 3. Unique ecological businesses: Installment e-commerce narrowed living and consumption scene, optimized supply chain, strengthened marketing in e-commerce events, continued customer capacity construction. 4. Deeply integrated AI technology: Customer service AI agents deployed in core scenarios, large models used in risk management and user operations to improve service efficiency and user experience.

Fourth quarter: Transaction amount 500 billion yuan, revenue 3 billion yuan, active users 453 million, new active users 88.4 million. Whole year 2025: Transaction amount 2,053 billion yuan, net profit 17 billion yuan, up 52.4%. Credit business net revenue: Credit facilitation service income down due to low volume and pricing, tech empowerment service income down from ICP business wind-down but partially offset by value-added services. E-commerce business net revenue: Increased by $56 million to $167 million.

1. In 2026, will seize opportunities, stick to user center, deepen multi-faceted ecological business, increase investment in small and medium-sized enterprises and high-quality consumer groups. 2. For 2026 financial performance, loan volume expected to gradually return to normalized growth range following stabilization. Revenue influenced by volume, pricing; cost and expense influenced by funding cost, credit cost, operating expenses. 3. Currently, not providing full-year financial guidance for 2026 due to macro uncertainties, but will be influenced by volume, pricing, funding cost, credit cost, operating expenses.

1. Industry risk rising in fourth quarter, optimized risk strategy, monitored new asset quality. 2. In fourth quarter, total asset loss rate rose, 90 plus bad rate rose, risk reached high point in October, then began to fluctuate. 3. Future needs to continue to strengthen risk control over loans and manage high-risk segments to ensure risk level trend.

Q: Under new regulatory environment, main considerations for future development strategies and key operating performance outlook for 2026.

A: Insist on user-centered operation, actively respond to supervision direction, lower loan interest rate, deepen market service to small and medium-sized consumer groups, expand overseas business. In 2026, with risk stabilizing, enhance customer experience and product competitiveness, focus on high-quality customers, strengthen refined management of high-quality assets, improve asset quality by acquiring high-quality customers, loan volume expected to gradually return to normalized growth range.

Q: Regarding risk outlook and full-year financial performance outlook.

A: Industry risk has begun to show steady decline but may take time to clear up, will continue to strengthen risk control. For 2026 full-year financial performance, influenced by volume, pricing, funding cost, credit cost, operating expenses, with macro uncertainties, maintain prudence.

Q: Company's future plan for enhancing shareholder returns in terms of share buyback and cash dividends.

A: Dividend payout ratio raised to 30% of semi-annual net profit, bought back 39 million dollars of stock, completed 80% of return plan, will continue to execute remaining repurchase plans and explore diverse initiatives to enhance shareholder returns.