• Qifu Technology Announces Second Quarter and Interim 2023 Unaudited Financial Results and Declares Semi-Annual Dividend

    Source: Nasdaq GlobeNewswire / 21 Aug 2023 17:00:00   America/Chicago

    SHANGHAI, China, Aug. 21, 2023 (GLOBE NEWSWIRE) -- Qifu Technology, Inc. (NASDAQ: QFIN; HKEx: 3660) (“Qifu Technology” or the “Company”), a leading Credit-Tech platform in China, today announced its unaudited financial results for the second quarter and six months ended June 30, 2023, and declared semi-annual dividend.

    Second Quarter 2023 Business Highlights

    • As of June 30, 2023, our platform has connected 153 financial institutional partners and 220.6 million consumers*1 with potential credit needs, cumulatively, an increase of 11.5% from 197.9 million a year ago.
    • Cumulative users with approved credit lines*2 were 47.4 million as of June 30, 2023, an increase of 14.9% from 41.3 million as of June 30, 2022.
    • Cumulative borrowers with successful drawdown, including repeat borrowers was 28.5 million as of June 30, 2023, an increase of 11.3% from 25.6 million as of June 30, 2022.
    • In the second quarter of 2023, financial institutional partners originated 16,702,579 loans*3 through our platform. Total facilitation and origination loan volume reached RMB124,225 million*4, an increase of 26.4% from RMB98,281 million in the same period of 2022.
    • Out of those loans originated by financial institutions, RMB71,860 million was under capital-light model, Intelligence Credit Engine (“ICE”) and other technology solutions*5, representing 57.8% of the total, an increase of 31.2% from RMB54,784 million in the same period of 2022.
    • Total outstanding loan balance*6 was RMB184,459 million as of June 30, 2023, an increase of 22.6% from RMB150,490 million as of June 30, 2022.
    • RMB114,835 million of such loan balance was under capital-light model, “ICE” and other technology solutions*7, an increase of 39.1% from RMB82,580 million as of June 30, 2022.
    • The weighted average contractual tenor of loans originated by financial institutions across our platform in the second quarter of 2023 was approximately 11.00 months, compared with 12.06 months in the same period of 2022.
    • 90 day+ delinquency rate*8 of loans originated by financial institutions across our platform was 1.84% as of June 30, 2023.
    • Repeat borrower contribution*9 of loans originated by financial institutions across our platform for the second quarter of 2023 was 92.3%.

    1 Refers to cumulative registered users across our platform.
    2 “Users with approved credit lines” refers to the total number of users who had submitted their credit applications and were approved with a credit line at the end of each period.
    3 Including 6,054,571 loans across “V-pocket”, and 10,648,008 loans across other products.
    4 Refers to the total principal amount of loans facilitated and originated during the given period, including loan volume facilitated through Intelligence Credit Engine (“ICE”) and other technology solutions.
    5 “ICE” is an open platform on our “360 Jietiao” APP, we match borrowers and financial institutions through big data and cloud computing technology on “ICE”, and provide pre-loan investigation report of borrowers. For loans facilitated through “ICE”, the Company does not bear principal risk. Loan facilitation volume through “ICE” was RMB6,912 million in the second quarter of 2023.
    Under other technology solutions, we offer financial institutions on-premise deployed, modular risk management SaaS, which helps financial institution partners improve credit assessment results. Loan facilitation volume through other technology solutions was RMB28,260 million in the second quarter of 2023.
    6 “Total outstanding loan balance” refers to the total amount of principal outstanding for loans facilitated and originated at the end of each period, including loan balance for “ICE” and other technology solutions, excluding loans delinquent for more than 180 days.
    7 Outstanding loan balance for “ICE” and other technology solutions were RMB9,365 million and RMB43,760 million, respectively, as of June 30, 2023.
    8 “90 day+ delinquency rate” refers to the outstanding principal balance of on- and off-balance sheet loans that were 91 to 180 calendar days past due as a percentage of the total outstanding principal balance of on- and off-balance sheet loans across our platform as of a specific date. Loans that are charged-off and loans under “ICE” and other technology solutions are not included in the delinquency rate calculation.
    9 “Repeat borrower contribution” for a given period refers to (i) the principal amount of loans borrowed during that period by borrowers who had historically made at least one successful drawdown, divided by (ii) the total loan facilitation and origination volume through our platform during that period.

    Second Quarter 2023 Financial Highlights

    • Total net revenue was RMB3,914.3 million (US$539.8 million), compared to RMB4,183.2 million in the same period of 2022.
    • Income from operations was RMB1,181.5 million (US$162.9 million), compared to RMB1,010.8 million in the same period of 2022.
    • Non-GAAP*10 income from operations was RMB1,234.7 million (US$170.3 million), compared to RMB1,057.5 million in the same period of 2022.
    • Operating margin was 30.2%. Non-GAAP operating margin was 31.5%.
    • Net income was RMB1,093.4 million (US$150.8 million), compared to RMB975.0 million in the same period of 2022.
    • Non-GAAP net income was RMB1,146.6 million (US$158.1 million), compared to RMB1,021.7 million in the same period of 2022.
    • Net income attributed to the Company was RMB1,097.4 million (US$151.3 million), compared to RMB979.8 million in the same period of 2022.
    • Net income margin was 27.9%. Non-GAAP net income margin was 29.3%.

    10 Non-GAAP income from operations (Adjusted Income from operations), Non-GAAP net income (Adjusted net income), Non-GAAP operating margin and Non-GAAP net income margin are non-GAAP financial measures. For more information on these non-GAAP financial measures, please see the section of “Use of Non-GAAP Financial Measures Statement” and the table captioned “Unaudited Reconciliations of GAAP and Non-GAAP Results” set forth at the end of this press release.

    Mr. Haisheng Wu, Chief Executive Officer and Director of Qifu Technology, commented, “While macro-economic recovery appeared moderating, along with consumers’ demand for credit, we managed to generate accelerated growth in loan volume in the second quarter, exceeding our internal targets. For the second quarter, total loan facilitation and origination volume was RMB124.2 billion, up approximately 26.4% year-on-year and 13.5% sequentially. Through optimizing customer acquisition channels and enriching product offerings, we achieved better customer engagement and activity levels, which are expected to continue to support sustainable growth. Approximately 58% of the loan volume was facilitated under the capital-light model, ICE and other technology solutions, which is slightly above the level in recent quarters.

    With an optimized user base, we continued to offer more attractive products in a stable pricing environment to achieve higher retention rates. Overall risk metrics were stable in the second quarter despite somewhat weakening consumer sentiment. In addition, we continued to strengthen our partnership with financial institutions to secure better funding terms. During the quarter we issued record amount of ABS, which helped us further reduce our overall funding costs to record low levels.

    We note that recent public statements by government agencies suggest further policy support to re-energize the economy. While the pace of macro-economic recovery is still uncertain, we will continue to drive for consistent executions and optimal balance between healthy growth and manageable risks. Some of the operational initiatives we launched recently are expected to make positive contributions in the second half of this year and the next year. In the long run, we are confident to maintain our leadership position in the industry through continued enhancement of business model and technology innovation.”

    “We are pleased to report another quarter of solid financial results amidst a moderately recovering macro environment. Total revenue was RMB3.91 billion and non-GAAP net income was RMB1,147 million for the second quarter,” Mr. Alex Xu, Chief Financial Officer, commented. “During the quarter, despite the macro uncertainty, we continued to deploy additional resources to drive business growth while maintaining a prudent approach to manage risks and cash flow. At the end of the second quarter, our total cash and cash equivalent*11 was approximately RMB8.5 billion, and we generated approximately RMB1.8 billion cash from operations. During the quarter, we announced a 12-month, US$150 million share repurchase program, which is still being gradually executed. Our strong financial positions not only enable us to drive additional growth, but also allow us to maintain decent shareholder returns through dividend payout and share repurchase.”

    Mr. Yan Zheng, Chief Risk Officer, added, “We see relatively stable overall risk metrics of our loan book in the second quarter as we continued to take a prudent approach in managing risks. While we observed some regain of confidence among our users, the pace and scope of such improvement remained uncertain. Among key leading indicators, Day-1 delinquency rate*12 was 4.2%, and 30-day collection rate*13 was approximately 87%. Both metrics were still close to the best levels in recent quarters. As the economic conditions change, we will continue to seek optimal balance between risk exposure and business growth.”

    11 Including “Cash and cash equivalents”, “Restricted cash”, and “Security deposit prepaid to third-party guarantee companies”.
    12 “Day-1 delinquency rate” is defined as (i) the total amount of principal that became overdue as of a specified date, divided by (ii) the total amount of principal that was due for repayment as of such specified date.
    13 “30 day collection rate” is defined as (i) the amount of principal that was repaid in one month among the total amount of principal that became overdue as of a specified date, divided by (ii) the total amount of principal that became overdue as of such specified date.

    Second Quarter 2023 Financial Results

    Total net revenue was RMB3,914.3 million (US$539.8 million), compared to RMB4,183.2 million in the same period of 2022, and RMB3,599.2 million in the prior quarter.

    Net revenue from Credit Driven Services was RMB2,788.7 million (US$384.6 million), compared to RMB2,947.8 million in the same period of 2022, and RMB2,630.6 million in the prior quarter.

    Loan facilitation and servicing fees-capital heavy were RMB395.5 million (US$54.5 million), compared to RMB580.4 million in the same period of 2022 and RMB311.2 million in the prior quarter. The year-over-year decrease was primarily due to a decline in capital-heavy loan facilitation volume and shorter average duration of the loans. The sequential increase was primarily due to higher capital-heavy loan volume and relatively stable effective duration of the loans.

    Financing income*14 was RMB1,188.7 million (US$163.9 million), compared to RMB819.6 million in the same period of 2022 and RMB1,065.9 million in the prior quarter. The year-over-year and sequential increases were primarily due to the growth in average outstanding balance of the on-balance-sheet loans.

    Revenue from releasing of guarantee liabilities was RMB1,158.6 million (US$159.8 million), compared to RMB1,524.5 million in the same period of 2022, and RMB1,209.8 million in the prior quarter. The year-over-year and sequential decreases were mainly due to decreases in average outstanding balance of off-balance-sheet capital-heavy loans during the period.

    Other services fees were RMB45.9 million (US$6.3 million), compared to RMB23.3 million in the same period of 2022, and RMB43.8 million in the prior quarter. The year-over-year and sequential increases were mainly due to the increases in late payment fees under the capital-heavy model.

    Net revenue from Platform Services was RMB1,125.6 million (US$155.2 million), compared to RMB1,235.4 million in the same period of 2022 and RMB968.6 million in the prior quarter.

    Loan facilitation and servicing fees-capital light were RMB887.8 million (US$122.4 million), compared to RMB1,030.0 million in the same period of 2022 and RMB765.3 million in the prior quarter. The year-over-year decrease was mainly due to a decline in the fees received from financial institutions as a result of reduced interest rates. The sequential increase was primarily due to higher capital-light loan volume and relatively stable effective duration of the loans.

    Referral services fees were RMB160.9 million (US$22.2 million), compared to RMB135.4 million in the same period of 2022 and RMB108.5 million in the prior quarter. The year-over-year and sequential increases were mainly due to the increase in the loan facilitation volume through ICE.

    Other services fees were RMB76.9 million (US$10.6 million), compared to RMB70.1 million in the same period of 2022 and RMB94.8 million in the prior quarter. The year-over-year and sequential changes were mainly due to changes in late payment fees.

    Total operating costs and expenses were RMB2,732.8 million (US$376.9 million), compared to RMB3,172.4 million in the same period of 2022 and RMB2,592.1 million in the prior quarter.

    Facilitation, origination and servicing expenses were RMB648.0 million (US$89.4 million), compared to RMB555.6 million in the same period of 2022 and RMB640.3 million in the prior quarter. The year-over-year increase was primarily due to higher credit search fees and collection fees.

    Funding costs were RMB165.2 million (US$22.8 million), compared to RMB123.9 million in the same period of 2022 and RMB159.0 million in the prior quarter. The year-over-year and sequential increases were mainly due to increases in funding from ABS, as a result of continued growth in on-balance-sheet loan balance, partially offset by the lower average cost of ABS.

    Sales and marketing expenses were RMB436.5 million (US$60.2 million), compared to RMB615.1 million in the same period of 2022 and RMB422.2 million in the prior quarter. The year-over-year and sequential changes were mainly due to changes in unit customer acquisition cost in the second quarter.

    General and administrative expenses were RMB112.8 million (US$15.6 million), compared to RMB93.9 million in the same period of 2022 and RMB104.9 million in the prior quarter. The year-over-year and sequential increases were mainly due to increases in professional service fees.

    Provision for loans receivable was RMB483.3 million (US$66.7 million), compared to RMB416.1 million in the same period of 2022 and RMB518.9 million in the prior quarter. The year-over-year increase was mainly due to the growth in loan origination volume of on-balance-sheet loans, partially offset by the better overall performance of loans facilitated in previous quarters. The sequential decrease was mainly due to a reversal of prior quarters’ provision in this quarter as on-balance-sheet loans facilitated in previous quarters performed better than expected.

    Provision for financial assets receivable was RMB82.3 million (US$11.3 million), compared to RMB103.7 million in the same period of 2022 and RMB68.8 million in the prior quarter. The year-over-year and sequential changes mainly reflected changes in loan facilitation volume of off-balance-sheet loans, and the Company’s consistent approach in assessing provisions commensurate with its underlying loan profile.

    Provision for accounts receivable and contract assets was RMB47.2 million (US$6.5 million), compared to RMB63.4 million in the same period of 2022 and RMB-2.2 million in the prior quarter. The year-over-year and sequential changes reflected the Company’s consistent approach in assessing provisions commensurate with its underlying loan profile.

    Provision for contingent liability was RMB757.6 million (US$104.5 million), compared to RMB1,200.7 million in the same period of 2022 and RMB680.3 million in the prior quarter. The year-over-year and sequential changes reflected the Company’s consistent approach in assessing provisions commensurate with its underlying loan profile. In addition, the year-over-year decrease was also partially due to the decrease in loan facilitation volume of off-balance-sheet loans.

    Income from operations was RMB1,181.5 million (US$162.9 million), compared to RMB1,010.8 million in the same period of 2022 and RMB1,007.0 million in the prior quarter.

    Non-GAAP income from operations was RMB1,234.7 million (US$170.3 million), compared to RMB1,057.5 million in the same period of 2022 and RMB1,053.5 million in the prior quarter.

    Operating margin was 30.2%. Non-GAAP operating margin was 31.5%.

    Income before income tax expense was RMB1,366.3 million (US$188.4 million), compared to RMB1,155.3 million in the same period of 2022 and RMB1,102.1 million in the prior quarter.

    Net income was RMB1,093.4 million (US$150.8 million), compared to RMB975.0 million in the same period of 2022 and RMB929.8 million in the prior quarter.

    Non-GAAP net income was RMB1,146.6 million (US$158.1 million), compared to RMB1,021.7 million in the same period of 2022 and RMB976.3 million in the prior quarter.

    Net income margin was 27.9%. Non-GAAP net income margin was 29.3%.

    Net income attributed to the Company was RMB1,097.4 million (US$151.3 million), compared to RMB979.8 million in the same period of 2022 and RMB934.1 million in the prior quarter.

    Non-GAAP net income attributed to the Company was RMB1,150.7 million (US$158.7 million), compared to RMB1,026.6 million in the same period of 2022 and RMB980.6 million in the prior quarter.

    Net income per fully diluted ADS was RMB6.64 (US$0.92).

    Non-GAAP net income per fully diluted ADS was RMB6.95 (US$0.96).

    Weighted average basic ADS used in calculating GAAP and non-GAAP net income per ADS was 161.55 million.

    Weighted average diluted ADS used in calculating GAAP and non-GAAP net income per ADS was 165.46 million.

    14 “Financing income” is generated from loans facilitated through the Company’s platform funded by the consolidated trusts and Fuzhou Microcredit, which charge fees and interests from borrowers.

    30 Day+ Delinquency Rate by Vintage and 180 Day+ Delinquency Rate by Vintage

    The following charts and tables display the historical cumulative 30 day+ delinquency rates by loan facilitation and origination vintage and 180 day+ delinquency rates by loan facilitation and origination vintage for all loans facilitated and originated through the Company’s platform. Loans under “ICE” and other technology solutions are not included in the 30 day+ charts and the 180 day+ charts:

    http://ml.globenewswire.com/Resource/Download/3585cb47-f68f-4d1a-930a-f3213411f25e

    http://ml.globenewswire.com/Resource/Download/30709a25-58a1-4484-886c-ce1c6a0e249c

    Semi-Annual Dividend

    The board of directors of the Company has approved a dividend of US$0.25 per Class A ordinary share, or US$0.50 per ADS for the first half of 2023 to holders of record of Class A ordinary shares and ADSs as of the close of business on September 22, 2023 Hong Kong Time and New York Time, respectively, in accordance with the Company’s dividend policy. For holder of Class A ordinary shares, in order to qualify for the dividend, all valid documents for the transfers of shares accompanied by the relevant share certificates must be lodged for registration with the Company’s Hong Kong branch share registrar, Computershare Hong Kong Investor Services Limited, at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Hong Kong no later than 4:30 p.m. on September 22, 2023 (Hong Kong Time). The payment date is expected to be on October 27, 2023 for holders of Class A ordinary shares and around November 1, 2023 for holders of ADSs.

    Update on Share Repurchase

    On June 20, 2023, the Company announced a share repurchase plan whereby the Company is authorized to repurchase its American depositary shares (“ADSs”) or Class A ordinary shares with an aggregate value of up to US$150 million during the 12-month period from June 20, 2023. From the launch of the share repurchase plan to August 18, 2023, the Company in aggregate purchased approximately 1.6 million ADSs in the open market for a total cost of approximately US$28.3 million (inclusive of commissions) at an average price of $18.03 per ADS pursuant to the share repurchase plan.

    Business Outlook

    While the year-on-year growth in loan volume in the second quarter of 2023 accelerated, which is in part due to a relatively lower loan volume in the same period of 2022, macro-economic uncertainties remained. At this junction, the Company continues to expect a slow recovery in consumer credit demand, with growth rates depending on macro conditions for the rest of the year to some extent. As such, the Company would like to adjust its outlook of loan volume for 2023 to be between RMB470 billion and RMB485 billion, representing a year-on-year growth of 14% to 18%, compared to the previous outlook of RMB455 billion to RMB495 billion. This outlook reflects the Company’s current and preliminary views, which is subject to material changes.

    Conference Call Preregistration

    Qifu Technology’s management team will host an earnings conference call at 8:00 PM U.S. Eastern Time on Monday, August 21, 2023 (8:00 AM Beijing Time on Tuesday, August 22).

    All participants wishing to join the conference call must pre-register online using the link provided below.

    Registration Link: https://register.vevent.com/register/BI814a184451444f5ab9d0166af26fe116

    Upon registration, each participant will receive details for the conference call, including dial-in numbers and a unique access PIN. Please dial in 10 minutes before the call is scheduled to begin.

    Additionally, a live and archived webcast of the conference call will be available on the Investor Relations section of the Company's website at http://ir.qifu.tech.

    About Qifu Technology

    Qifu Technology is a Credit-Tech platform in China that provides a comprehensive suite of technology services to assist financial institutions and consumers and SMEs in the loan lifecycle, ranging from borrower acquisition, preliminary credit assessment, fund matching and post-facilitation services. The Company is dedicated to making credit services more accessible and personalized to consumers and SMEs through Credit-Tech services to financial institutions.

    For more information, please visit: https://ir.qifu.tech.

    Use of Non-GAAP Financial Measures Statement

    To supplement our financial results presented in accordance with U.S. GAAP, we use Non-GAAP financial measure, which is adjusted from results based on U.S. GAAP to exclude share-based compensation expenses. Reconciliations of our Non-GAAP financial measures to our U.S. GAAP financial measures are set forth in tables at the end of this earnings release, which provide more details on the Non-GAAP financial measures.

    We use Non-GAAP income from operation, Non-GAAP operating margin, Non-GAAP net income, Non-GAAP net income margin, Non-GAAP net income attributed to the Company and Non-GAAP net income per fully diluted ADS in evaluating our operating results and for financial and operational decision-making purposes. Non-GAAP income from operation represents income from operation excluding share-based compensation expenses. Non-GAAP operating margin is equal to Non-GAAP income from operation divided by total net revenue. Non-GAAP net income represents net income excluding share-based compensation expenses. Non-GAAP net income margin is equal to Non-GAAP net income divided by total net revenue. Non-GAAP net income attributed to the Company represents net income attributed to the Company excluding share-based compensation expenses. Non-GAAP net income per fully diluted ADS represents net income per fully diluted ADS excluding share-based compensation expenses. Such adjustments have no impact on income tax. We believe that Non-GAAP income from operation and Non-GAAP net income help identify underlying trends in our business that could otherwise be distorted by the effect of certain expenses that we include in results based on U.S. GAAP. We believe that Non-GAAP income from operation and Non-GAAP net income provide useful information about our operating results, enhance the overall understanding of our past performance and future prospects and allow for greater visibility with respect to key metrics used by our management in its financial and operational decision-making. Our Non-GAAP financial information should be considered in addition to results prepared in accordance with U.S. GAAP, but should not be considered a substitute for or superior to U.S. GAAP results. In addition, our calculation of Non-GAAP financial information may be different from the calculation used by other companies, and therefore comparability may be limited.

    Exchange Rate Information

    This announcement contains translations of certain RMB amounts into U.S. dollars at specified rates solely for the convenience of the reader. Unless otherwise noted, all translations from RMB to U.S. dollars are made at a rate of RMB7.2513 to US$1.00, the exchange rate set forth in the H.10 statistical release of the Board of Governors of the Federal Reserve System as of June 30, 2023.

    Safe Harbor Statement

    Any forward-looking statements contained in this announcement are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by terminology such as “will,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates” and similar statements. Among other things, the business outlook and quotations from management in this announcement, as well as the Company’s strategic and operational plans, contain forward-looking statements. Qifu Technology may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission (“SEC”), in announcements made on the website of The Stock Exchange of Hong Kong Limited (the “Hong Kong Stock Exchange”), in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including the Company’s business outlook, beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, which factors include but not limited to the following: the Company’s growth strategies, the Company’s cooperation with 360 Group, changes in laws, rules and regulatory environments, the recognition of the Company’s brand, market acceptance of the Company’s products and services, trends and developments in the credit-tech industry, governmental policies relating to the credit-tech industry, general economic conditions in China and around the globe, and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks and uncertainties is included in Qifu Technology’s filings with the SEC and announcements on the website of the Hong Kong Stock Exchange. All information provided in this press release is as of the date of this press release, and Qifu Technology does not undertake any obligation to update any forward-looking statement, except as required under applicable law.

    For more information, please contact:

    Qifu Technology
    E-mail: ir@360shuke.com

    Unaudited Condensed Consolidated Balance Sheets
    (Amounts in thousands of Renminbi (“RMB”) and U.S. dollars (“USD”)
    except for number of shares and per share data, or otherwise noted)

     December 31, June 30, June 30,
     2022  2023   2023
     RMB  RMB   USD
    ASSETS     
    Current assets:     
    Cash and cash equivalents7,165,584 5,256,375 724,887
    Restricted cash3,346,779 3,058,166 421,740
    Short term investments57,000 247,539 34,137
    Security deposit prepaid to third-party guarantee companies396,699 210,362 29,010
    Funds receivable from third party payment service providers1,158,781 1,183,720 163,242
    Accounts receivable and contract assets, net2,868,625 2,808,531 387,314
    Financial assets receivable, net2,982,076 2,746,010 378,692
    Amounts due from related parties394,872 187,938 25,918
    Loans receivable, net15,347,662 21,430,147 2,955,352
    Prepaid expenses and other assets379,388 428,973 59,158
    Total current assets34,097,466   37,557,761   5,179,450
    Non-current assets:     
    Accounts receivable and contract assets, net-non current261,319 172,413 23,777
    Financial assets receivable, net-non current688,843 522,451 72,049
    Amounts due from related parties33,236 12,407 1,711
    Loans receivable, net-non current3,136,994 2,881,248 397,342
    Property and equipment, net47,602 106,719 14,717
    Land use rights,net998,185 987,823 136,227
    Intangible assets4,696 4,718 651
    Deferred tax assets1,019,171 1,097,504 151,353
    Other non-current assets55,658 59,069 8,146
    Total non-current assets6,245,704   5,844,352   805,973
    TOTAL ASSETS40,343,170   43,402,113   5,985,423
          
    LIABILITIES AND EQUITY     
    Current liabilities:     
    Payable to investors of the consolidated trusts-current6,099,520 5,965,297 822,652
    Accrued expenses and other current liabilities2,004,551 1,755,914 242,152
    Amounts due to related parties113,697 105,383 14,533
    Short term loans150,000 260,000 35,856
    Guarantee liabilities-stand ready4,120,346 3,851,692 531,173
    Guarantee liabilities-contingent3,418,391 3,306,712 456,016
    Income tax payable661,015 796,928 109,901
    Other tax payable182,398 144,361 19,908
    Total current liabilities16,749,918   16,186,287   2,232,191
    Non-current liabilities:     
    Deferred tax liabilities100,835 122,347 16,872
    Payable to investors of the consolidated trusts-noncurrent4,521,600 6,146,000 847,572
    Other long-term liabilities39,520 61,912 8,538
    Total non-current liabilities4,661,955   6,330,259   872,982
    TOTAL LIABILITIES21,411,873   22,516,546   3,105,173
    TOTAL QIFU TECHNOLOGY INC EQUITY18,847,156   20,809,775   2,869,798
    Noncontroling interests84,141 75,792 10,452
    TOTAL EQUITY18,931,297   20,885,567   2,880,250
    TOTAL LIABILITIES AND EQUITY40,343,170   43,402,113   5,985,423
          

    Unaudited Condensed Consolidated Statements of Operations
    (Amounts in thousands of Renminbi (“RMB”) and U.S. dollars (“USD”)
    except for number of shares and per share data, or otherwise noted)

      Three months ended June 30,   Six months ended June 30,
     202220232023 202220232023
     RMBRMBUSD RMBRMBUSD
    Credit driven services 2,947,767   2,788,707   384,580    5,868,397   5,419,328   747,359  
    Loan facilitation and servicing fees-capital heavy580,360 395,512 54,544  1,141,771 706,676 97,455 
    Financing income819,572 1,188,738 163,934  1,608,820 2,254,620 310,926 
    Revenue from releasing of guarantee liabilities1,524,547 1,158,554 159,772  3,074,515 2,368,374 326,614 
    Other services fees23,288 45,903 6,330  43,291 89,658 12,364 
    Platform services 1,235,432   1,125,617   155,229    2,634,849   2,094,170   288,799  
    Loan facilitation and servicing fees-capital light1,030,024 887,830 122,437  2,128,955 1,653,110 227,974 
    Referral services fees135,352 160,864 22,184  382,650 269,340 37,144 
    Other services fees70,056 76,923 10,608  123,244 171,720 23,681 
    Total net revenue 4,183,199   3,914,324   539,809    8,503,246   7,513,498   1,036,158  
    Facilitation, origination and servicing555,631 647,989 89,362  1,170,561 1,288,330 177,669 
    Funding costs123,862 165,225 22,786  227,630 324,248 44,716 
    Sales and marketing615,080 436,486 60,194  1,167,657 858,663 118,415 
    General and administrative93,890 112,757 15,550  216,148 217,646 30,015 
    Provision for loans receivable416,090 483,306 66,651  907,317 1,002,170 138,206 
    Provision for financial assets receivable103,703 82,265 11,345  164,217 151,017 20,826 
    Provision for accounts receivable and contract assets63,417 47,206 6,510  117,025 44,970 6,202 
    Provision for contingent liabilities1,200,742 757,590 104,476  2,162,638 1,437,924 198,299 
    Total operating costs and expenses 3,172,415   2,732,824   376,874    6,133,193   5,324,968   734,348  
    Income from operations 1,010,784   1,181,500   162,935    2,370,053   2,188,530   301,810  
    Interest income, net43,771 55,854 7,703  68,188 120,624 16,635 
    Foreign exchange (loss) gain(91,610)(2,319)(320) (86,658)3,830 528 
    Other income, net196,410 161,388 22,256  203,458 185,552 25,589 
    Investment loss(4,096)(30,112)(4,153) (8,996)(30,112)(4,153)
    Income before income tax expense 1,155,259   1,366,311   188,421    2,546,045   2,468,424   340,409  
    Income taxes expense(180,303)(272,934)(37,639) (396,732)(445,225)(61,399)
    Net income 974,956   1,093,377   150,782    2,149,313   2,023,199   279,010  
    Net loss attributable to noncontrolling interests4,883 4,063 560  10,024 8,350 1,152 
    Net income attributable to ordinary shareholders of the Company 979,839   1,097,440   151,342    2,159,337   2,031,549   280,162  
    Net income per ordinary share attributable to ordinary shareholders of Qifu Technology, Inc.    
    Basic3.14 3.40 0.47  6.94 6.29 0.87 
    Diluted3.06 3.32 0.46  6.74 6.14 0.85 
            
    Net income per ADS attributable to ordinary shareholders of Qifu Technology, Inc.    
    Basic6.28 6.80 0.94  13.88 12.58 1.74 
    Diluted6.12 6.64 0.92  13.48 12.28 1.70 
            
    Weighted average shares used in calculating net income per ordinary share    
    Basic311,615,233 323,095,877 323,095,877  311,109,257 322,978,323 322,978,323 
    Diluted319,874,351 330,918,585 330,918,585  320,251,194 331,118,889 331,118,889 
                  

    Unaudited Condensed Consolidated Statements of Cash Flows
    (Amounts in thousands of Renminbi (“RMB”) and U.S. dollars (“USD”)
    except for number of shares and per share data, or otherwise noted)

      Three months ended June 30,   Six months ended June 30,
     202220232023 202220232023
     RMBRMBUSD RMBRMBUSD
    Net cash provided by operating activities1,118,314 1,761,575 242,932  2,537,911 3,522,666 485,798 
    Net cash used in investing activities(252,787)(3,436,966)(473,979) (2,694,432)(7,001,173)(965,506)
    Net cash provided by financing activities1,052,143 1,236,187 170,478  2,129,177 1,275,127 175,848 
    Effect of foreign exchange rate changes1,443 8,401 1,158  (2,377)5,558 766 
    Net increase (decrease) in cash and cash equivalents1,919,113 (430,803)(59,411) 1,970,279 (2,197,822)(303,094)
    Cash, cash equivalents, and restricted cash, beginning of period8,811,113 8,745,344 1,206,038  8,759,947 10,512,363 1,449,721 
    Cash, cash equivalents, and restricted cash, end of period10,730,226 8,314,541 1,146,627  10,730,226 8,314,541 1,146,627 
                  

    Unaudited Condensed Consolidated Statements of Comprehensive Income
    (Amounts in thousands of Renminbi (“RMB”) and U.S. dollars (“USD”)
    except for number of shares and per share data, or otherwise noted)

      Three months ended June 30,
     2022 2023 2023
     RMB RMB USD
    Net income974,956  1,093,377  150,782
    Other comprehensive income, net of tax of nil:     
    Foreign currency translation adjustment49,579 19,482 2,687
    Other comprehensive income49,579 19,482 2,687
    Total comprehensive income1,024,535  1,112,859  153,469
    Comprehensive loss attributable to noncontrolling interests4,883 4,063 560
    Comprehensive income attributable to ordinary shareholders1,029,418  1,116,922  154,029
          
          
      Six months ended June 30,
     2022 2023 2023
     RMB RMB USD
    Net income 2,149,313   2,023,199   279,010
    Other comprehensive income, net of tax of nil:     
    Foreign currency translation adjustment43,320 16,673 2,299
    Other comprehensive income43,320 16,673 2,299
    Total comprehensive income2,192,633  2,039,872  281,309
    Comprehensive loss attributable to noncontrolling interests10,024 8,350 1,152
    Comprehensive income attributable to ordinary shareholders2,202,657  2,048,222  282,461
          

    Unaudited Reconciliations of GAAP and Non-GAAP Results
    (Amounts in thousands of Renminbi (“RMB”) and U.S. dollars (“USD”)
    except for number of shares and per share data, or otherwise noted)

      Three months ended June 30,
     202220232023 
     RMBRMBUSD 
    Reconciliation of Non-GAAP Net Income to Net Income    
    Net income974,956  1,093,377  150,782  
    Add: Share-based compensation expenses46,759 53,247 7,343 
    Non-GAAP net income1,021,715  1,146,624  158,125  
    GAAP net income margin23.3%27.9%  
    Non-GAAP net income margin24.4%29.3%  
         
    Net income attributable to shareholders of Qifu Technology, Inc.979,839  1,097,440  151,342  
    Add: Share-based compensation expenses46,759 53,247 7,343 
    Non-GAAP net income attributable to shareholders of Qifu Technology, Inc.1,026,598  1,150,687  158,685  
    Weighted average ADS used in calculating net income per ordinary share for both GAAP and non-GAAP EPS -diluted159,937,176 165,459,293 165,459,293 
    Net income per ADS attributable to ordinary shareholders of Qifu Technology, Inc. -diluted6.12 6.64 0.92 
    Non-GAAP net income per ADS attributable to ordinary shareholders of Qifu Technology, Inc. -diluted6.42 6.95 0.96 
         
    Reconciliation of Non-GAAP Income from operations to Income from operations    
    Income from operations1,010,784  1,181,500  162,935  
    Add: Share-based compensation expenses46,759 53,247 7,343 
    Non-GAAP Income from operations1,057,543  1,234,747  170,278  
    GAAP operating margin24.2%30.2%  
    Non-GAAP operating margin25.3%31.5%  
         
         
      Six months ended June 30,
     202220232023 
     RMBRMBUSD 
    Reconciliation of Non-GAAP Net Income to Net Income    
    Net income2,149,313  2,023,199  279,010  
    Add: Share-based compensation expenses98,833 99,743 13,755 
    Non-GAAP net income2,248,146  2,122,942  292,765  
    GAAP net income margin25.3%26.9%  
    Non-GAAP net income margin26.4%28.3%  
         
    Net income attributable to shareholders of Qifu Technology, Inc.2,159,337  2,031,549  280,162  
    Add: Share-based compensation expenses98,833 99,743 13,755 
    Non-GAAP net income attributable to shareholders of Qifu Technology, Inc.2,258,170  2,131,292  293,917  
    Weighted average ADS used in calculating net income per ordinary share for both GAAP and non-GAAP EPS -diluted160,125,597 165,559,445 165,559,445 
    Net income per ADS attributable to ordinary shareholders of Qifu Technology, Inc. -diluted13.48 12.28 1.70 
    Non-GAAP net income per ADS attributable to ordinary shareholders of Qifu Technology, Inc. -diluted14.10 12.87 1.78 
         
    Reconciliation of Non-GAAP Income from operations to Income from operations    
    Income from operations2,370,053  2,188,530  301,810  
    Add: Share-based compensation expenses98,833 99,743 13,755 
    Non-GAAP Income from operations2,468,886  2,288,273  315,565  
    GAAP operating margin27.9%29.1%  
    Non-GAAP operating margin29.0%30.5%  
           

Share on,