On November 26th, China's leading new consumer digital technology service provider Lexin released unaudited financial results for the third quarter of 2024, with revenue of 3.66 billion yuan and profit of 409 million yuan, a month on month increase of 33.2%. Thanks to continuous risk and data infrastructure development, the quality of newly added assets has improved quarter by quarter, and the overall asset structure of the market is of higher quality and health. All risk indicators have improved comprehensively, and the cost of capital has decreased, resulting in high-quality performance growth.
In terms of risk, high-quality assets accounted for over 75% of the newly added assets in the third quarter, and the early risk indicator FPD7 decreased by about 13% month on month; The market's call in rate decreased by about 9% compared to the second quarter. In the third quarter, high-quality asset quality was welcomed by more financial institutions, and the cost of funds hit a new historical low, a decrease of 98 basis points compared to the second quarter.
In order to better fulfill its shareholder return commitment and demonstrate the company's long-term development confidence, Lexin has decided to increase its dividend payout on the basis of continuing to distribute dividends twice a year (the first half of the year dividend was already distributed in October). Approved by the board of directors, starting from 2025, the dividend ratio of Lexin will increase from the current 20% of net profit to 25%.
LeXin CEO Xiao Wenjie said, "In the past year, LeXin has continued to strengthen its risk management capabilities, focus on high-quality customer groups, and promote the improvement of the company's refined operational capabilities, making significant progress. The company's overall assets are healthier and the structure is more favorable, and risks have reached a turning point. Asset profitability has begun to recover. Looking ahead, the company will continue to strengthen risk management, focus on high-quality growth, increase investment in consumer scenarios, and create differentiated competitive advantages. By 2025, the company is confident in the continuous improvement of asset quality and accelerated recovery of profits
According to the financial report, in the third quarter, Lexin's R&D investment was 149 million yuan, a year-on-year increase of 17.7%, continuing to maintain industry leadership and further consolidating Lexin's risk and technological capabilities, injecting surging momentum into its dual wheel drive strategy.
Since the end of last year, Lexin has comprehensively upgraded its risk management system, including strengthening the full lifecycle risk control management system, enhancing risk monitoring and early warning capabilities, developing strategic robots, upgrading intelligent anti fraud models, and significantly enhancing its ability to respond to risks. In the third quarter, the company focused on expanding and adding high-quality assets, and fully implemented Low& Grow strategy, optimization of key channel placement, targeted re offers for high-quality dormant customer groups, and creation of a risk model exclusive to high-quality small and micro customer groups. During the quarter, new assets continued to improve, and the risk of the overall market assets reached a turning point.
LeXin's ecological businesses such as installment Le Mall, consumer finance, and inclusive finance have steadily developed, effectively promoting consumption growth, driving the real economy, and assisting small, micro, and micro businesses in practicing the concept of inclusive finance. In the third quarter, Installment Joy Mall continued to improve its product supply chain and deeply tap into the consumption potential of young consumers. In October, Installment Joy Mall actively responded to the policy call to promote consumption and joined hands with the government to issue consumption vouchers, covering over 1200 brands and driving consumption of nearly 100 million yuan. The just passed Double Eleven saw a year-on-year increase of 17% in cumulative transaction orders and 25% in cumulative transaction volume.
In the third quarter, Puhui's business continued to penetrate the industrial belts of third - and fourth tier cities, connecting over 4 billion yuan in funds for nearly 200000 small and micro enterprises, small and micro enterprises, and other customer groups. Puhui Business leverages its two core capabilities of precise risk identification and local direct customer acquisition, as well as its two service advantages of on-site service and fastest 10 minute loan disbursement, to bridge the last mile of financial services in the sinking industrial belt. In the third quarter, Lexin continued to increase its support for small and micro enterprises, launching the "Believe in Small Dreams" inclusive finance support plan worth billions. At present, the plan has been deeply implemented in provinces such as Guangdong, Zhejiang, Shaanxi, and Hebei, to support the development of small and micro enterprises in multiple industrial clusters such as Jieyang Jade, Quzhou Children's Car, and Jiaxing Down Jacket.