Qifu Technology’s Earnings Call Highlights AI Growth

Qifu Technology, Inc ((QFIN)) has held its Q1 earnings call. Read on for the main highlights of the call.

Qifu Technology, Inc. recently held its earnings call, revealing a generally positive sentiment driven by significant growth in AI-driven operations, non-GAAP net income, and the embedded finance and Technology Solutions segments. Despite these achievements, the company faces challenges from increased sales and marketing expenses and macroeconomic uncertainties.

AI-Driven Growth and Efficiency

The company showcased impressive AI-driven growth, with its AI-powered credit decision engine and asset distribution platform serving 58 million users and 163 financial institutions. This technological advancement led to an improved take rate, which increased by 2.2 percentage points year-over-year to 5.7%.

Significant Increase in Non-GAAP Net Income

Qifu Technology reported a remarkable 59.9% year-over-year increase in non-GAAP net income, reaching RMB1.93 billion. Additionally, the non-GAAP EPADS rose by 78.5% to RMB13.5, highlighting the company’s strong financial performance.

Expansion of Embedded Finance Business

The embedded finance business saw substantial growth, with credit line users increasing by 36% year-over-year and loan volume surging by approximately 106%. This expansion underscores the company’s successful strategy in this segment.

Growth in Technology Solutions Business

Partnerships with three additional municipal banks contributed to a 144% year-over-year increase in loan volume from the Technology Solutions segment, demonstrating the company’s ability to expand its market reach and enhance its service offerings.

Strong Cash Position and Shareholder Returns

Qifu Technology generated RMB2.81 billion in cash from operations, with total share repurchases in 2025 projected to be no less than USD 680 million. The company plans an 11% decrease in total share count, reflecting its commitment to returning value to shareholders.

Increased Sales and Marketing Expenses

The company experienced a 13% quarter-on-quarter and 42% year-on-year increase in sales and marketing expenses, driven by higher volume contributions from API channels. This rise in expenses is a key area for management to monitor moving forward.

Macroeconomic Uncertainty and Trade Tensions

Qifu Technology acknowledged the impact of U.S.-China trade tensions, which have introduced uncertainty into the market, affecting credit demand and risk levels. This macroeconomic challenge remains a critical factor for the company’s future performance.

Slight Increase in Day-One Delinquency Rate

The day-one delinquency rate saw a slight increase to 5.0% in Q1, attributed to changes in the loan mix and a smaller portion of early-stage loans. This metric requires careful management to maintain credit quality.

Forward-Looking Guidance

Looking ahead, Qifu Technology remains cautiously optimistic, focusing on enhancing operational efficiency, optimizing capital allocation, and pursuing a “one core two wings” strategy to sustain high-quality growth. The company reported a 15.8% year-over-year increase in total loan facilitation and origination volume, with a take rate rise of 2.2 percentage points to 5.7%. Despite macroeconomic headwinds, Qifu Technology maintained a stable C2M2 metric and reduced overall funding costs, signaling a robust outlook.

In conclusion, Qifu Technology’s earnings call highlighted a strong performance driven by AI advancements and strategic growth in key business segments. While the company faces challenges from increased expenses and macroeconomic uncertainties, its forward-looking strategy and financial strength position it well for continued success.