Lexinfintech Holdings Ltd (LX) 2025 Q3 法說會逐字稿

Good day, and thank you for standing by. Welcome to the Lexin Third Quarter 2025 Earnings Conference Call. (Operator Instructions) Please be advised, today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Will Tan. Please go ahead.

您好，感謝您的耐心等待。歡迎參加樂信集團2025年第三季財報電話會議。（操作員指示）請注意，今天的會議正在錄音。現在我謹將會議交給今天的第一位發言人，威爾·譚。請繼續。

Thank you, operator. Hello, everyone. Welcome to our third quarter 2025 earnings conference call. Our results were released earlier today and are currently available on our IR website. Today, you will hear from our Chairman and CEO, Mr. Jay Wenjie Xiao, who will provide an update on our overall performance and strategies of our business. Our CRO, Mr. Arvin Zhanwen Qiao, will then provide more details on our risk management initiatives and updates. Lastly, our CFO, Mr. James Zheng, will discuss our financial performance. Before we continue, I would like to refer you to our safe harbor statement in our earnings press release, which also applies today's call as we will be making forward-looking statements.

謝謝接線生。大家好。歡迎參加我們2025年第三季財報電話會議。我們的研究結果已於今天稍早發布，目前可在我們的投資者關係網站上查閱。今天，我們將聽取董事長兼執行長肖文傑先生的講話，他將介紹我們公司的整體業績和策略。我們的首席風險長喬佔文先生隨後將詳細介紹我們的風險管理舉措和最新進展。最後，我們的財務長鄭先生將討論我們的財務表現。在繼續之前，我想請各位參閱我們在盈利新聞稿中的安全港聲明，該聲明也適用於今天的電話會議，因為我們將發表前瞻性聲明。

Last, please note that all figures are presented in renminbi terms, and all comparisons are made on a quarter-over-quarter basis, unless otherwise stated. Please kindly note, Jay and Arvin will give their whole remarks in Chinese first, then the English version will be delivered by Jay's and Arvin's AI-based voices. With that, I'm now pleased to turn over the call to Mr. Jay Wenjie Xiao, Chairman and CEO of Lexin. Please.

最後請注意，除非另有說明，所有數字均以人民幣計價，所有比較均按季度環比進行。請注意，Jay 和 Arvin 將首先用中文發表全部講話，然後英文版本將由 Jay 和 Arvin 的人工智慧語音播報。接下來，我很高興將電話交給樂信集團董事長兼執行長肖文傑先生。請。

(interpreted) Hi, everyone. Thanks for joining us today for our third quarter 2025 earnings call. In the third quarter, we efficiently completed our business adjustments to comply with the new regulation. The smooth transition was mainly attributed to the company's strong risk management capabilities that we've been enhancing over recent years and the resilience of our business ecosystem. This demonstrates our long-term oriented development philosophy and our strong resilience in navigating business cycles, effectively mitigating the impact of industry fluctuations on the company. Against the backdrop of industry fluctuations, we delivered solid performance in the third quarter. Loan volume reached RMB50.89 billion. Revenue reached RMB3.42 billion. Net profit was RMB521 million, up 2% quarter-over-quarter and 68% year-over-year. Net profit take rate stood at 2.01%, increasing by 9 basis points quarter-over-quarter and 92 basis points year-over-year. We believe that the implementation of the new regulations will further raise industry entry barriers and drive the industry toward a healthier and more orderly development. Our unique advantages in business ecosystem synergy and customer-centric operation system will position us more favorably in the future.

（譯）大家好。感謝各位今天參加我們2025年第三季財報電話會議。第三季度，我們有效率地完成了業務調整，以符合新規。平穩過渡主要歸功於公司近年來不斷增強的強大風險管理能力以及我們業務生態系統的韌性。這反映了我們著眼於長遠的發展理念和應對商業週期的強大韌性，有效減輕了產業波動對公司的影響。在產業波動的大背景下，我們第三季取得了穩健的業績。貸款總額達人民幣508.9億元。營收達34.2億元。淨利為人民幣5.21億元，季增2%，年增68%。淨利率達 2.01%，季增 9 個基點，年增 92 個基點。我們相信，新規的實施將進一步提高產業進入門檻，推動產業朝著更健康、更有序的發展方向邁進。我們在商業生態系統綜效和以客戶為中心的營運體系方面的獨特優勢，將使我們在未來處於更有利的地位。

We are confident that our long-term investment in the fundamental capabilities and the ecosystem businesses will gradually turn into our distinctive and powerful advantages. We have always placed great emphasis on shareholder returns. As we announced previously, the dividend payout ratio was increased from 25% to 30% of the net profit starting from the second half of this year. In addition to the cash dividend, the company's share repurchase plan and my personal share purchase plan are progressing well with each initiative, now more than halfway completed. Next, I will walk you through the key initiatives we have made in the third quarter. First, we strengthened user categorization and risk identification and took early actions to address the industry risks. In light of the industry risk trends in the third quarter, we enhanced user categorization and risk identification and took proactive measures to manage risk, effectively balancing business volume and asset risk.

我們相信，我們對基礎能力和生態系統業務的長期投資將逐步轉化為我們獨特而強大的優勢。我們一直非常重視股東回報。正如我們之前宣布的那樣，從今年下半年開始，股息支付率從淨利潤的 25% 提高到 30%。除了現金分紅外，公司的股票回購計畫和我的個人股票購買計畫進展順利，兩項計畫目前都已完成過半。接下來，我將帶您了解我們在第三季採取的關鍵舉措。首先，我們加強了用戶分類和風險識別，並採取了早期措施來應對行業風險。鑑於第三季行業風險趨勢，我們加強了用戶分類和風險識別，並採取積極措施管理風險，有效平衡了業務量和資產風險。

During the quarter, leveraging our historical cycle models, we systematically phased out users highly sensitive to cyclical impacts and exhibiting instability and adjusted our risk management strategy accordingly. We further refined our customer segmentation and implemented tailored pricing strategies accordingly. As a result, new assets in the third quarter maintained a balanced risk return profile. Second, we enhanced user experience by adopting a customer-centric approach. In the third quarter, we upgraded our products and management capabilities, and the development of our customer care system has yielded positive results.

本季度，我們利用歷史週期模型，有條不紊地逐步淘汰了對週期性影響高度敏感且表現出不穩定性用戶，並相應地調整了風險管理策略。我們進一步細化了客戶細分，並據此實施了客製化的定價策略。因此，第三季新增資產維持了均衡的風險報酬狀況。其次，我們採取以客戶為中心的方法，提升了使用者體驗。第三季度，我們升級了產品和管理能力，客戶服務系統的建置也取得了正面成果。

This allowed us to fulfill the financial and service needs of different customer segments. During the quarter, we collaborated with financial institutions to optimize funding supply and expanded the coverage of flexible repayment solutions, such as flexible borrowing and repayment and bullet loans. In addition, we provided customized reoffer to improve customer satisfaction and loyalty, effectively enhancing user retention. As a result, the proportion and contribution of high-quality customer continued to grow.

這使我們能夠滿足不同客戶群的財務和服務需求。本季度，我們與金融機構合作，優化資金供應，擴大靈活還款方案的覆蓋範圍，例如靈活借貸和還款以及一次性還款貸款。此外，我們也提供客製化的再優惠，以提高顧客滿意度和忠誠度，有效提升用戶留存率。因此，優質客戶的比例和貢獻持續成長。

Third, we accelerated our AI technology deployment leveraged integrated AI agents to drive digital transformation. In the third quarter, we further advanced our AI initiatives. Our self-developed large model, Lexin GPT, has incorporated multidimensional data providing AI agents with stronger decision-making capabilities under different scenarios. This has improved the accuracy of user request identification by over 20% and significantly enhanced request solution efficiency. During the quarter, AI agent has been applied in multiple areas such as risk management, credit granting and repayment, and we'll continue to expand to other areas. [Belong] to the industrial integrated AI agent has facilitated data connectivity and task coordination in different scenarios, thereby creating stronger business synergies.

第三，我們加快了人工智慧技術的部署，利用整合人工智慧代理來推動數位轉型。第三季度，我們進一步推進了人工智慧計畫。我們自主研發的大型模式 Lexin GPT 融合了多維數據，為 AI 代理提供了在不同情境下更強大的決策能力。這使得用戶請求識別的準確率提高了 20% 以上，並顯著提高了請求解決效率。本季度，人工智慧代理已應用於風險管理、信貸核准和還款等多個領域，我們將持續拓展至其他領域。 [屬於]工業整合人工智慧代理已在不同場景下促進了數據連接和任務協調，從而創造了更強大的業務協同效應。

We have laid a solid foundation for AI-driven digital transformation, providing robust technological support for improving efficiency, revenue growth and user experience optimization. In the third quarter, different business units within our ecosystem work together to create synergies and collectively reinforce the resilience of our ecosystem. Online consumer finance business targets at high-quality customers and focused on optimizing service experience, significantly enhancing user engagement and retention. Installment e-commerce business targets at young customers in key consumption scenarios. We continue to refine the supply chain system of our e-commerce platform, GMV, for essential daily consumer goods, grew 58.5% quarter-over-quarter and 133.8% year-over-year during the recent Singles Day Shopping Festival.

我們為人工智慧驅動的數位轉型奠定了堅實的基礎，為提高效率、增加收入和優化用戶體驗提供了強大的技術支援。第三季度，我們生態系統內的不同業務部門共同努力，創造協同效應，共同增強我們生態系統的韌性。線上消費金融業務的目標客戶是優質客戶，專注於優化服務體驗，顯著提高用戶參與度和留存率。分期付款電子商務的目標客戶是處於關鍵消費場景的年輕消費者。我們持續完善電子商務平台的供應鏈系統，在最近的「雙十一」購物節期間，基本日用消費品的GMV較上季成長58.5%，較去年同期成長133.8%。

The total GMV of e-commerce platform increased by 38% year-over-year, with transaction volume for essential daily consumer goods surging by 237% year-over-year. Offline inclusive finance focuses on small and micro business owners in lower-tier markets. The asset quality of inclusive finance business remained stable in the quarter, validating the value of the lower-tier markets. We will continue to increase investments in off-line markets and further improve its operations. Both tech empowerment business and overseas business achieved steady growth in volume during the quarter.

電子商務平台的總GMV年增38%，其中基本日用消費品的交易量較去年同期成長237%。線下普惠金融主要面向低層市場的小微企業主。本季普惠金融業務的資產品質保持穩定，驗證了低層市場的價值。我們將繼續增加對線下市場的投資，並進一步改善其營運。本季度，技術賦能業務和海外業務的銷量均實現了穩步成長。

The company has always adhered to a user-centric service philosophy, positioning consumer rights protection as a core competitive advantage. In the third quarter, we comprehensively strengthened our consumer rights protection system across multiple dimensions, including policies, products and services. In terms of policies, we integrated consumer rights protection into our sustainable development strategy, implementing measures across all business processes through various mechanisms.

本公司始終堅持以使用者為中心的服務理念，將消費者權益保護視為核心競爭優勢。第三季度，我們從政策、產品和服務等多個維度全面加強了消費者權益保護體系。在政策方面，我們將消費者權益保護納入永續發展策略，並透過各種機制在所有業務流程中實施相關措施。

In terms of products and services, we actively responded to user needs by leveraging technological means, such as online customer service center and AI-empowered customer support to improve service efficiency and quality. We also proactively gathered user feedback for data analytics aiming to enhance user satisfaction at the sorts. In response to frequent violations of consumer rights by illegal activities, we actively followed regulatory requirements and collaborated with the industry to combat such activities, which has achieved positive results. With the new regulations taking effect in the fourth quarter, the industry is now on a healthier and more sustainable path. Having completed our business adjustments, we are well positioned to capture opportunities arising from the industry adjustments by increasing investments in ecosystem businesses and drive steady growth. Looking ahead, we are confident in achieving stable performance growth. Next, I'll hand over the floor to our CRO, Arvin. Thanks.

在產品和服務方面，我們積極回應使用者需求，利用線上客戶服務中心和人工智慧賦能的客戶支援等技術手段來提高服務效率和品質。我們也積極收集用戶回饋，進行數據分析，旨在提高用戶在網咖的滿意度。針對非法活動頻繁侵犯消費者權益的情況，我們積極遵守監管要求，並與業界合作打擊此類活動，取得了積極的成效。隨著新規在第四季度生效，該行業現在走上了一條更健康、更永續的道路。完成業務調整後，我們已做好充分準備，透過增加對生態系統業務的投資，抓住產業調整帶來的機遇，推動穩定成長。展望未來，我們有信心實現穩定的業績成長。接下來，我將把發言權交給我們的首席營收長阿文。謝謝。

(interpreted) Thanks, Jay. Next, I will provide a review of our key initiatives and achievements in risk management for the third quarter. In the third quarter, industry uncertainty remained elevated. With the new regulations officially took effect in October, industry-wide liquidity tightened further on a month-over-month basis in the fourth quarter. Impacted by the broader industry trends, our day 1 delinquency ratio and the collection rate of loan balance saw a minor increase. Thanks to the proactive measures we've taken to enhance risk control and mitigate risk starting from the second quarter, the overall risk volatility remains manageable.

（翻譯）謝謝你，傑伊。接下來，我將回顧我們第三季在風險管理方面的主要措施和成果。第三季度，產業不確定性依然居高不下。隨著新規於 10 月正式生效，第四季度整個行業的流動性環比進一步收緊。受整個行業趨勢的影響，我們的首日逾期率和貸款餘額回收率略有上升。由於我們從第二季開始採取了積極主動的措施來加強風險控制和降低風險，整體風險波動仍然可控。

In response to the complex industry environment, we have further tightened risk controls over high-risk customers by phasing out risky accounts and reducing credit lines. These measures have helped keep new loan risks manageable and ensure full compliance with regulatory requirements. Meanwhile, we doubled down on serving prime customers to promote the growth of high-quality assets. Let me introduce the key initiatives we've taken in the third quarter. First, during the third quarter, we further enhanced risk control measures for high-risk customers.

為因應複雜的產業環境，我們進一步加強了對高風險客戶的風險控制，逐步取消高風險帳戶並降低信用額度。這些措施有助於將新增貸款風險控制在可控範圍內，並確保完全符合監管要求。同時，我們加倍努力服務優質客戶，以促進高品質資產的成長。讓我來介紹一下我們在第三季採取的主要舉措。首先，在第三季度，我們進一步加強了對高風險客戶的風險控制措施。

From a credit model perspective, we enhanced data mining on key variables, such as multiple borrowing, pricing preference and income verification to enhance identification of customers sensitive to industry fluctuations. In the meantime, by integrating the latest risk trends and optimizing our customer credit behavior time series model, we were able to identify anomalous signals accurately and swiftly, further enhancing the identification of high-risk customers. From risk strategies perspective, we continue to intensify management of high-risk assets.

從信用模型角度來看，我們加強了關鍵變數（如多次借貸、定價偏好和收入驗證）的資料探勘，以增強對受產業波動影響的客戶識別。同時，透過整合最新的風險趨勢並優化我們的客戶信用行為時間序列模型，我們能夠準確、迅速地識別異常訊號，進一步增強對高風險客戶的識別。從風險策略的角度來看，我們將持續加強對高風險資產的管理。

We systematically phase out customers with excessive share debt exposure, multiple borrowings and high-risk profiles, and reduced credit line of borrowers with weak repayment capacity or those vulnerable to liquidity tightening. Second, in the third quarter, we continued to enhance our operational capabilities tailored to prime customers. In terms of model and enhancement, we operated multidimensional models, including demand, response and churn models, and make targeted investments in our outreach approach, credit line granting and pricing alignment to ensure service quality.

我們會系統性地逐步淘汰那些股票債務敞口過大、借款過多、風險較高的客戶，並降低那些償還能力較弱或容易受到流動性緊縮影響的借款人的信貸額度。其次，在第三季度，我們持續提升為主要客戶量身訂製的營運能力。在模型和改進方面，我們採用了多維模型，包括需求模型、回應模型和流失模型，並針對我們的推廣方式、信貸額度授予和定價調整進行有針對性的投資，以確保服務品質。

Also, we have reinforced our customer-centric approach to enhance the customer experience for prime customers. In terms of credit line, we continue to maintain our offer competitiveness. In terms of pricing, we implemented product-based pricing to reactivate dormant and [churned] customers. In terms of repayment methods, we introduced tailored solutions like flexible borrowing and repayment and bullet loans for prime customers. Furthermore, we enhanced one-on-one services for prime customers by providing customized re-offers, further boosting customer satisfaction and loyalty.

此外，我們也加強了以客戶為中心的策略，以提升優質客戶的客戶體驗。在信貸額度方面，我們持續保持競爭力。在定價方面，我們實施了基於產品的定價，以重新激活沉睡和流失的客戶。在還款方式方面，我們為優質客戶推出了靈活的借貸和還款方式以及一次性還款貸款等客製化解決方案。此外，我們透過提供客製化的再行銷服務，加強了對優質客戶的一對一服務，進一步提高了客戶滿意度和忠誠度。

Thanks to these initiatives, loan volumes from prime customer segments achieved month-on-month growth in the third quarter. Third, in the installment e-commerce business, our risk management system has been gradually refined with further strengthened risk identification capabilities. In the third quarter, in light of external uncertainties, we proactively adjusted the growth pace of our installment e-commerce business to strike a balance between scale and risk and to achieve sustainable business development. We've strengthened the risk criteria of our installment e-commerce business, proactively scaling back exposure to high-risk and sensitive customers. At the same time, we selectively provided support for categories such as high-quality consumer electronics by allocating dedicated credit lines, which help drive e-commerce GMV growth. Looking ahead to the fourth quarter, we will dynamically adjust our strategies based on the industry risk trends to ensure steady, healthy and sustainable business growth.

由於這些舉措，第三季優質客戶群的貸款金額實現了環比成長。第三，在分期付款電子商務業務中，我們的風險管理系統已逐步完善，風險識別能力進一步增強。第三季度，鑑於外部環境的不確定性，我們主動調整了分期付款電子商務業務的成長速度，以在規模和風險之間取得平衡，以實現可持續的業務發展。我們加強了分期付款電子商務業務的風險標準，主動減少了對高風險和敏感客戶的風險敞口。同時，我們透過分配專用信貸額度，選擇性地為高品質消費性電子產品等品類提供支持，這有助於推動電子商務GMV的成長。展望第四季度，我們將根據產業風險趨勢動態調整策略，以確保業務穩定、健康和永續成長。

Last but not the least, in the development of intelligent risk control tools, we've achieved remarkable progress in building the next-generation smart risk control system. The risk control intelligent agent for credit decision-making empowered by larger scale models has been launched. It enables full process automation and intelligence from customer targeting, segmentation and strategy formulation to results evaluation, marking a paradigm shift from quantitative driven to AI-driven risk management. This has significantly enhanced the efficiency and effectiveness of credit decision-making. In the fourth quarter, the impact of the new regulation is expected to persist, characterized by industry-wide liquidity tightening and risk fluctuations.

最後但同樣重要的是，在智慧風險控制工具的開發方面，我們在建構下一代智慧風險控制系統方面取得了顯著進展。利用大規模模型賦能的信用決策風險控制智慧代理程式已經上線。它實現了從客戶定位、細分和策略制定到結果評估的全流程自動化和智慧化，標誌著風險管理從定量驅動到人工智慧驅動的範式轉變。這大大提高了信貸決策的效率和效果。預計第四季度新規的影響將持續，其特點是整個行業的流動性收緊和風險波動。

As such, business volume and risk performance are expected to remain under pressure in the first half of the fourth quarter and may gradually stabilize and improve in the second half. In response, we will continue to strengthen risk identification and enhanced management of high-risk assets in order to ensure risk fluctuations under control, laying a solid foundation for steady and sustainable business operations.

因此，預計第四季上半年業務量和風險表現將繼續承壓，下半年可能會逐漸穩定和改善。對此，我們將繼續加強風險識別和高風險資產的強化管理，以確保風險波動得到控制，為穩定可持續的業務運營奠定堅實基礎。

Thanks, Arvin. I will now provide a detailed overview of our third quarter financial results. Please note that all figures are presented in renminbi terms, and all comparisons are made on the quarter-over-quarter basis, unless otherwise stated. As Jay mentioned earlier, to proactively adapt to the evolving regulatory environment, we initiated a business adjustment in the third quarter. While this adaptation temporarily led to declines in loan volumes and overall pricing, we leveraged our business ecosystem to effectively mitigate the impact. Despite ongoing (inaudible) adjustments and industry credit risk volatility related to the new policy, we delivered steady net profit growth in the third quarter. Our net income grew by 2% quarter-over-quarter and 68% year-over-year to reach RMB521 million, a record high in the last 15 quarters. Our net income margin increased to [15%] from 14% last quarter.

謝謝你，阿文。接下來，我將詳細介紹我們第三季的財務表現。請注意，除非另有說明，所有數字均以人民幣計價，所有比較均按季度環比進行。正如 Jay 之前提到的，為了積極適應不斷變化的監管環境，我們在第三季啟動了業務調整。雖然這種調整暫時導致貸款量和整體定價下降，但我們利用我們的商業生態系統有效地減輕了這種影響。儘管與新政策相關的持續（聽不清楚）調整和行業信用風險波動，我們第三季仍實現了穩定的淨利潤成長。我們的淨利較上季成長2%，年增68%，達到人民幣5.21億元，創近15季以來的新高。我們的淨利潤率從上個季度的 14% 提高到 15%。

Our net income take rate increased 9 basis points to reach 2.01%. We have realized the net income take rate goal of achieving over 2% by year-end ahead of the original schedule as we communicated earlier this year. This underscores the company's results and improved ability to execute on our business objectives. Now let's take a holistic review of our third quarter financial results. First, net revenue of the credit business, which is derived by adding up credit facilitation service income and tech empowerment service income, net of credit cost, including provisions and fair value changes and the funding cost reached RMB1.9 billion, a 3% or RMB59 million decrease quarter-over-quarter.

我們的淨收入轉換率提高了 9 個基點，達到 2.01%。正如我們今年稍早所宣布的那樣，我們已經提前實現了年底前淨收入轉換率超過 2% 的目標，比原計劃提前完成。這凸顯了公司的表現以及我們執行業務目標能力的提升。現在讓我們對第三季的財務表現進行全面回顧。首先，信貸業務淨收入（由信貸便利服務收入和技術賦能服務收入相加得出，扣除信貸成本（包括撥備和公平價值變動以及融資成本））達到人民幣19億元，環比下降3%或人民幣5,900萬元。

The decrease was primarily attributable to an increase in credit costs of approximately RMB40 million, reflecting continuously strengthened provisioning. Second, net revenue of the e-commerce business, defined by e-commerce revenue. Net of cost of inventory sold increased by 14% or RMB14 million to RMB111 million. So the total net revenue summing the credit and e-commerce business added up to RMB2.1 billion, a 2% or RMB46 million decrease quarter-over-quarter. Operating expenses, including sales and marketing, R&D, G&A, processing and serving costs decreased by 4% or RMB57 million to RMB1.4 billion. Tax and others increased by 1% or RMB1.8 million to RMB162 million. The total expenses added up to RMB1.5 billion, decreased by 3% or RMB56 million.

此下降主要歸因於信貸成本增加約人民幣4,000萬元，反映出撥備持續加強。其次，電子商務業務的淨收入，定義為電子商務收入。扣除已售存貨成本後，淨額成長14%，即人民幣1,400萬元，達到人民幣1.11億元。因此，信貸和電子商務業務的總淨收入為人民幣21億元，比上一季減少了2%，即人民幣4,600萬元。營業費用（包括銷售和市場推廣、研發、一般及行政費用、加工和服務費用）減少了 4%，即 5,700 萬元人民幣，至 14 億元。稅金及其他費用增加1%，即人民幣180萬元，達1.62億元人民幣。總支出為人民幣15億元，減少了3%，即人民幣5,600萬元。

By deducting total expenses of RMB1.5 billion from the total net revenue of RMB2.1 billion, we get net income of RMB521 million, an increase of 2% or RMB10 million quarter-over-quarter. Given the backdrop of the pending regulation and the associated industry credit risk volatility, it was not an easy task to achieve this record high profit in the third quarter. During the net profit growth, driving this is the resilience of our business model and the 3 key factors: one, our operational agility demonstrated by a smooth transition between the capital light and capital heavy models; two, our installment e-commerce steady growth and the profit contribution; three, our solid financial position underpinned by the adequate and prudent provisioning.

從21億元的總淨收入中減去15億元人民幣的總支出，得出淨利為5.21億元人民幣，比上一季增長2%，即1000萬元人民幣。鑑於即將出台的監管規定以及相關的行業信用風險波動，在第三季度實現創紀錄的利潤並非易事。淨利潤成長的驅動力在於我們業務模式的韌性以及以下三個關鍵因素：一、我們營運的靈活性，體現在資本輕型和資本重型模式之間的平穩過渡；二、我們分期付款電子商務的穩定增長及其利潤貢獻；三、我們穩健的財務狀況，以充足和審慎的撥備為支撐。

Next, I'm going to elaborate a little bit more on these three highlights. First, our operational agility demonstrated by smooth transitions between the capital light and the capital heavy model. In the third quarter, in order to meet the new regulatory requirements, we started to transition our business by gradually reducing capital light business volume. By October 1, we have completely stopped facilitating loans with APRs above 24% and were fully compliant with the new rules. As a result, in Q3, the mix of capital light loan volume further reduced from 20% to 13%, while the ICP business only accounted for 8.5% of the new loans. As the new regulatory framework, we continue to serve a select group of long-tail clients using the capital-heavy model. As such, the mix of capital-heavy loan volume increased from 80% to 87% of the total new loan volume, largely offsetting the decline of ICP volume. Thanks to the smooth transitions between the two models, total loan volume only saw a modest decrease of 3.7% compared to the second quarter.

接下來，我將更詳細地闡述這三個亮點。首先，我們透過平穩地在輕資本模式和重資本模式之間轉換，展現了我們的營運彈性。第三季度，為了滿足新的監管要求，我們開始逐步減少輕資產業務量，從而轉型我們的業務。截至 10 月 1 日，我們已完全停止發放年利率超過 24% 的貸款，並完全遵守新法規。因此，在第三季度，輕資本貸款的比例從 20% 進一步下降到 13%，而 ICP 業務僅佔新貸款的 8.5%。在新監理架構下，我們持續採用資本密集模式為部分長期客戶提供服務。因此，資本密集型貸款的比例從新增貸款總額的 80% 增加到 87%，在很大程度上抵消了 ICP 貸款量的下降。由於兩種模式之間的平穩過渡，貸款總額與第二季相比僅小幅下降了 3.7%。

As ICP business primarily serves long-tail customers, it naturally bears higher pricing, therefore, the wind-down of ICP business had a negative impact on our overall pricing, which was partially offset by the lower funding costs associated with the capital heavy model. Driven by the above factors, our tech empowerment service income, which represents income from capital light model and value-added services, decreased by 45% or RMB374 million. While our credit facilitation service income, which mainly consists of income from capital heavy model, increased by 15.3% or RMB347 million. As a result, revenue from credit business only decreased by 1% or RMB27 million despite a loan volume decrease of 3.7% in the third quarter, demonstrating our operational agility to navigate regulatory changes.

由於ICP業務主要服務於長尾客戶，其定價自然較高，因此，ICP業務的逐步停止對我們的整體定價產生了負面影響，但這種負面影響被資本密集型模式帶來的較低融資成本部分抵消。受上述因素影響，我們的技術賦能服務收入（代表輕資本模式和增值服務的收入）下降了 45%，即 3.74 億元人民幣。我們的信貸便利服務收入（主要來自資本密集模式的收入）成長了15.3%，即人民幣3.47億元。因此，儘管第三季貸款額下降了 3.7%，但信貸業務收入僅下降了 1% 或 2,700 萬元，這表明我們具備應對監管變化的營運彈性。

Second, steady growth of e-commerce business and its growing contribution in the third quarter. Despite strong demand driven by credit availability for long-tail customer segments since the second quarter, we observed an industry-wide risk volatility in the third and fourth quarter. In response, we prudently slowed down the growth of e-commerce loan volume as we prioritize quality rather than volume of the assets. As a result, our e-commerce loan volume grew by [50%] sequentially to RMB2.3 billion. For the upcoming fourth quarter, we'll continue to keep a close eye on the asset risk performance and strike a balance between the volume growth and asset quality.

第二，電子商務業務穩步成長，並在第三季貢獻不斷增加。儘管自第二季以來，長尾客戶群的信貸供應充足，需求強勁，但我們在第三季和第四季觀察到了整個產業的風險波動。為此，我們謹慎地放緩了電子商務貸款規模的成長，因為我們優先考慮的是資產品質而不是數量。因此，我們的電子商務貸款金額較上季成長50%，達到人民幣23億元。對於即將到來的第四季度，我們將繼續密切關注資產風險表現，並在交易量成長和資產品質之間取得平衡。

As a reminder, if you look at the e-commerce revenue in our P&L, it recorded a decline of 29% to RMB345 million despite the e-commerce GMV growth of [15%]. This is caused by the accounting treatment difference due to the continued volume shift to third-party sellers from company direct sourcing model. For third-party sellers, only platform service fee is recognized as revenue, rather than the entire transaction amount and the direct sourcing model. In the third quarter, third-party seller model accounted for [85%] of e-commerce GMV compared to 75% from last quarter. As mentioned earlier, our e-commerce business generates 2 profit streams, mainly the gross profit from selling merchandise and interest income from loan installment services. In the third quarter, gross profit reached RMB111 million, representing an increase of 14%. The growth in our e-commerce business gross profit has not only enhanced our overall profitability, but also expanded our targeted long-tail user segments, thereby further mitigating the impact of our business model transition. Going forward, we will continue to grow our e-commerce operations prudently and fully leverage its unique advantages and the new regulatory environment. Third, we continue to maintain a robust financial position, characterized by adequate and prudent provisioning.

需要提醒的是，如果您查看我們損益表中的電子商務收入，儘管電子商務GMV有所增長，但仍下降了29%，至人民幣3.45億元。[15%]。這是由於公司持續從直接採購模式轉向第三方賣家，導致會計處理方式不同。對於第三方賣家而言，只有平台服務費才能確認為收入，而不是全部交易金額和直接採購模式。第三季度，第三方賣家模式佔電子商務GMV的85%，而上一季為75%。如前所述，我們的電子商務業務產生 2 個利潤來源，主要是銷售商品的毛利和貸款分期服務的利息收入。第三季毛利達到人民幣1.11億元，年增14%。電子商務業務毛利的成長不僅提高了我們的整體獲利能力，而且擴大了我們的目標長尾用戶群體，從而進一步減輕了我們業務模式轉型的影響。展望未來，我們將繼續審慎發展電子商務業務，充分利用其獨特優勢和新的監管環境。第三，我們持續維持穩健的財務狀況，其特點是撥備充足且審慎。

Our total provisions saw an increase, while the overall asset quality remained healthy, evidenced by a 15 basis point improvement of 90-day delinquency ratio to 3.0%. However, as the industry transitions towards the new regulatory framework, we [observeding] an increased the volatility in early risk indicators starting from September. While we consider the fluctuations to be temporary, the whole industry may need some time to fully absorb the impact, and we expect the industry-wide risk volatility to continue into the fourth quarter. In response, we have sustained our strategy of setting aside ample provisions to ensure a strong buffer during the transition period. In the third quarter, our credit cost, including three provision line items and fair value changes on financial guarantee derivatives, rose 4% or RMB40 million to RMB1.1 billion. Due to the net accounting policy we've adopted for the item change in fair value of financial guarantee derivatives and loans and fair value, the actual full provision we set was partially offset by the guaranteed income and recorded as a net amount in our P&L.

雖然我們的撥備總額有所增加，但整體資產品質依然良好，90 天逾期率改善了 15 個基點，達到 3.0%，證明了這一點。然而，隨著產業向新的監管框架過渡，我們觀察到，從 9 月開始，早期風險指標的波動性增加。雖然我們認為這些波動是暫時的，但整個產業可能需要一些時間來充分吸收其影響，我們預計整個產業的風險波動將持續到第四季。為此，我們堅持先前的策略，預留充足的資金，以確保在過渡時期擁有強大的緩衝能力。第三季度，我們的信貸成本（包括三個撥備項目和金融擔保衍生性商品的公允價值變動）上升了4%，即人民幣4,000萬元，達到人民幣11億元。由於我們對金融擔保衍生性商品和貸款的公允價值變動採用了淨額會計政策，我們實際設定的全部準備金被擔保收入部分抵消，並作為淨額記錄在我們的損益表中。

As such, the reported item only represents part of the actual full provision. If excluding the impact of the net accounting policy and the recovering the growth provision, the full provision ratio of new assets calculated by dividing gross provision by capital-heavy loan volume, increased 6 basis points from the second quarter to 6.97%, well above the historical highs of vintage charge-offs. As Arvin mentioned, we continue to closely monitor asset performance and utilize various post-lending management tools to strengthen collections, while maintaining ample financial buffer to navigate through the credit cycle. As a summary, the above three highlights impacted net revenue side of the income statement. In short, total revenue reached RMB3.4 billion, representing a decrease of 5% quarter-over-quarter. This was mainly due to a 29% decrease in e-commerce platform service income, which was caused by ongoing shift in the e-commerce business model and the corresponding net versus growth adjustment in the accounting treatment.

因此，所報告的項目僅代表實際全部供應的一部分。如果排除淨會計政策和恢復成長準備金的影響，以毛準備金除以資本密集型貸款金額計算的新資產完全準備金率，從第二季度開始上升 6 個基點至 6.97%，遠高於歷史最高水平的舊貸款核銷。正如 Arvin 所提到的，我們將繼續密切監控資產表現，並利用各種貸後管理工具來加強催收，同時保持充足的財務緩衝以度過信貸週期。綜上所述，以上三點對損益表中的淨收入部分產生了影響。簡言之，總收入達到人民幣34億元，季減5%。這主要是由於電子商務平台服務收入下降了 29%，這是由於電子商務商業模式的持續轉變以及會計處理中相應的淨額與增長額調整。

On the cost and expense side, total operating expenses, which include processing and servicing costs, sales and marketing expenses, R&D and G&A expenses, reduced by 4% to RMB1.4 billion, reflecting (inaudible) of user acquisition costs during the uncertain times of business transition. For balance sheet items, as of September 30, our cash position, which includes cash, cash equivalents and restricted cash, was approximately RMB4.3 billion. Shareholders' equity remained solid at about RMB11.8 billion. Looking ahead, as Q4 marks the first quarter after the new regulation framework came into force, we expect industry-wide risk fluctuations to remain for some time before the industry enters into a new normal stage.

在成本和費用方面，包括加工和服務成本、銷售和行銷費用、研發和一般管理費用在內的總營運費用減少了 4%，至人民幣 14 億元，反映了（聽不清楚）在業務轉型不確定時期的用戶獲取成本。截至9月30日，資產負債表項目顯示，我們的現金部位（包括現金、現金等價物及受限現金）約為人民幣43億元。股東權益維持穩健，約118億元人民幣。展望未來，由於第四季度是新監管框架生效後的第一個季度，我們預計在產業進入新的常態階段之前，整個產業的風險波動將持續一段時間。

In light of this, we'll continue to adopt a prudent operational approach, prioritizing regulatory compliance and asset quality over business expansion. For the fourth quarter, we expect to see moderate quarter-over-quarter decline in loan volume. Impacted by the ongoing credit risk volatility, net income and net income take rate will see a sequential decrease. We expect to see more clarity and certainty of credit risks and the profit outlook may be at the close of the fourth quarter.

有鑑於此，我們將繼續採取審慎的營運方式，優先考慮監管合規和資產質量，而不是業務擴張。我們預計第四季度貸款量將出現環比溫和下降。受持續的信用風險波動影響，淨收入和淨收入獲取率將季減。我們預計，在第四季末，信貸風險和獲利前景將更加明朗和確定。

To conclude, I'd like to reaffirm our commitment to enhancing shareholder value. In addition to our semi-annual dividend, we'll continue to execute our share buyback program. As of October, we have repurchased $25 million worth of ADS, alongside the CEO's personal purchase of over USD 5 million worth of [shares]. On the foundation of current shareholders' return policy, we will continue to evaluate opportunities and explore different ways to ensure we deliver optimal value to our shareholders. That's all our prepared remarks for today. Operator, we are now ready to take questions.

最後，我想重申我們致力於提升股東價值的承諾。除了半年一次的股利外，我們還將繼續執行股票回購計畫。截至10月，我們已回購價值2,500萬美元的美國存託股份（ADS），此外，執行長個人也購買了價值超過500萬美元的ADS。[股份]。在現有股東回報政策的基礎上，我們將繼續評估各種機會，探索不同的方法，以確保為股東創造最大價值。這就是我們今天準備好的所有發言稿。操作員，我們現在可以開始接受提問了。

(Operator Instructions)

（操作說明）

Alex Ye, UBS.

Alex Ye，瑞銀集團。

(interpreted) First one is regarding the new regulation on the loan (inaudible), which has come into effect in October 1. Could you share us more color on what impact does it have on the business operations? Second question is on maybe you can share more color on the development strategy and outlook of the e-commerce business?

（翻譯）第一個是關於貸款的新規定（聽不清楚），該規定已於 10 月 1 日生效。您能否詳細介紹一下這對業務營運有何影響？第二個問題是，您能否更詳細地分享電子商務業務的發展策略和前景？

(interpreted) The translation for Jay's remarks. In the third quarter, we proactively made business adjustments to comply with the new regulation. On October 1, we have stopped underwriting loans with APR above 24% and ensure the business compliance. All new loans issued by the company carry an APR at or below 24%. After shifting to business with pricing below 24%, we gave up higher risk customers, which have some impact on both business volume and average loan pricing. Following the implementation of the new regulation, industry-wide risk have increased due to tighter funding. Starting in September and October, most platforms stop offering products with APR above 24%, leading to significant short-term volatilities and risk. Although the overall impact remain manageable, the industry [needs] some time to fully digest the associated credit risk.

（翻譯）傑伊講話的翻譯。第三季度，我們積極主動地對業務進行調整，以符合新規。10月1日起，我們停止承銷年利率超過24%的貸款，並確保業務符合。公司所發放的所有新貸款的年利率均在 24% 或以下。在轉向定價低於 24% 的業務後，我們放棄了風險較高的客戶，這對業務量和平均貸款定價都產生了一定的影響。新規實施後，由於資金收緊，整個產業的風險增加。從 9 月和 10 月開始，大多數平台將停止提供年利率超過 24% 的產品，導致短期內顯著的波動和風險。儘管整體影響仍在可控範圍內，但該行業需要一些時間來充分消化相關的信用風險。

For Lexin, as we have taken effective measures, our risk performance for new loans or existing loan portfolio have shown signs of stabilization and improvement now, validating the effectiveness of our risk management system. In the long run, the new regulation will pave the way for a more compliant, healthy and sustainable stage of high-quality development in industry. When the regulatory framework becomes clearer, market resources will be increasingly concentrated towards leading compliant platform with strong risk control capabilities and stable operations. Lexin has always adhered to a customer-centric business philosophy, prioritizing compliance operations, asset quality and prudent development. Furthermore, it's worth noting that Lexin's diversified business ecosystem has demonstrated strong resilience in adapting to the new regulation.

對於樂信銀行而言，由於我們採取了有效措施，目前新貸款或現有貸款組合的風險表現已呈現穩定和改善的跡象，驗證了我們風險管理系統的有效性。從長遠來看，新規將為產業進入更合規、健康和可持續的高品質發展階段鋪平道路。當監管框架更加清晰時，市場資源將越來越集中於領先的合規平台，這些平台擁有強大的風險控制能力和穩定的營運。樂信始終堅持以客戶為中心的經營理念，優先考慮合規營運、資產品質和穩健發展。此外，值得注意的是，樂信多元化的業務生態系統在適應新規方面展現出了強大的韌性。

More specifically, our online consumer finance business is progressing steadily and has been included in a wire list of all major financial partners, paving the way for future development. Our offline inclusive finance business focuses on small and micro business owners in lower-tier markets. This asset quality remained stable in the quarter, validating the value of the lower-tier markets. In (inaudible) e-commerce business targets at young segments in key consumption scenarios for building the consumption and financing demand of long-tail customer segments through innovative model.

更具體地說，我們的線上消費金融業務正在穩步發展，並已被列入所有主要金融合作夥伴的名單，為未來的發展鋪平了道路。我們的線下普惠金融業務主要針對低層市場的小微企業主。本季資產品質保持穩定，驗證了低層市場的價值。（聽不清楚）電子商務業務的目標是透過創新模式，在關鍵消費場景中瞄準年輕群體，以建立長尾客戶群的消費和融資需求。

Both set empowerment and overseas businesses achieved stable volume growth in the quarter. Under the new regulatory environment, Lexin will gradually unlock the unique competitive advantages of its business ecosystem. As a crucial component of Lexin's ecosystem, our installment e-commerce business will continue to play a key role in consumer -- in customer acquisition, engagement and expanding our operational outgrowth. In terms of business development strategy, over the past year,

本季度，企業自主營運和海外業務均實現了穩定的銷售成長。在新監管環境下，樂信將逐步釋放其商業生態系統的獨特競爭優勢。作為樂信生態系統的重要組成部分，我們的分期付款電子商務業務將繼續在消費者方面發揮關鍵作用——在客戶獲取、互動和擴大我們的營運成長方面。就業務發展策略而言，過去一年來，

We have comprehensively upgraded the e-commerce platform supply chain, introduced branded merchants from various industries and expanded (inaudible) to meet user essential daily consumption. In the third quarter, the transaction volume of essential lifestyle product categories increased by 58.5% quarter-over-quarter and 133.8% year-over-year. During the recent [double 11] shopping festival, the e-commerce GMV also experienced significant growth.

我們全面升級了電子商務平台供應鏈，引進了各行業的品牌商家，並擴大了（聽不清楚）範圍，以滿足用戶日常必需消費的需求。第三季度，生活必需品類的交易額較上季成長 58.5%，年增 133.8%。在最近的雙十一購物節期間，電子商務GMV也經歷了顯著成長。

Meanwhile, leveraging the e-commerce platform independent risk management (inaudible) to balance business quality with (inaudible) we will continue to optimize and expand our product categories on our platform to meet users' consumption and financial needs while effectively managing risk, further expanding our operational model. In terms of development pace, we have consistently adhered to the principle of prudent operation and prioritized asset quality. The third and fourth quarters, as we observed increased industry-wide risk fluctuation due to actively moderated growth pace of our installed (inaudible). In the near term, given the industry rate do require time to stabilize, we will continue to exercise caution in growing our installment e-commerce business. When industry-wide credit rate show size of stabilization, we will gradually resume the growth pace in order to capture the next phase of rapid expansion opportunities.

同時，我們將利用電子商務平台的獨立風險管理（聽不清楚）來平衡業務品質與（聽不清楚），繼續優化和擴展我們平台上的產品類別，以滿足用戶的消費和財務需求，同時有效管理風險，進一步擴展我們的營運模式。在發展速度方面，我們始終堅持穩健經營的原則，並將資產品質放在首位。第三季和第四季度，由於我們積極放緩了已安裝設備的成長速度，我們觀察到整個產業的風險波動加劇。（聽不清楚）短期內，鑑於行業利率需要時間穩定下來，我們將繼續謹慎發展分期付款電子商務業務。當產業整體信貸利率出現穩定跡象時，我們將逐步恢復成長步伐，以抓住下一階段的快速擴張機會。

Judy Zhang, Citi.

Judy Zhang，花旗銀行。

(interpreted) So during the transitional period before and after the implementation of the new regulation, the industry credit risk has already fluctuate significantly. And the company the updated the risk of control system. So as we're managing this round of business cycle and what improvements have been made to derisk the management system?

（解釋）因此，在新規實施前後的過渡期內，產業信用風險已經出現顯著波動。該公司更新了風險控制系統。那麼，在我們應對本輪商業週期時，為了降低管理系統的風險，我們做了哪些改進？

(interpreted) After the rollout of the new regulation, we anticipated that it will affect the industry liquidity supply. This is based on experience that we accumulated across multiple cycles. This would, in turn, weigh on the industry's credit rate. Therefore, starting from the second quarter, we made an adjustment in our risk management reidentification strategy and also made business adjustments.

（譯文）新規出台後，我們預期它將影響產業流動性供應。這是基於我們經過多個週期累積的經驗。這反過來又會對行業的信用評級造成壓力。因此，從第二季開始，我們對風險管理重新識別策略進行了調整，並對業務進行了調整。

We proactively identify customers who were vulnerable to tighten industry liquidity based on factors and high multi borrowing, high debt exposure, loan income, unstable employment and high exposure to high pricing traffic. Based on this reidentification, we utilize automated rescanning robot, clearance robots and credit line robot to improve efficiency and effectiveness of account clearing and credit line reduction. This allowed us to respond early in the risk cycle and control the risk fluctuations to both new loans and existing loan portfolio.

我們主動識別那些因行業流動性收緊而容易受到各種因素影響的客戶，例如多重借貸、高債務風險敞口、貸款收入、不穩定的就業以及高價流量風險敞口。基於此重新識別，我們利用自動重新掃描機器人、清算機器人和信用額度機器人來提高帳戶清算和信用額度削減的效率和效果。這使我們能夠在風險週期的早期階段做出反應，並控制新貸款和現有貸款組合的風險波動。

At the same time, by enhancing pricing competitiveness, optimizing long tenor and repayment experiences, we've strengthened engagement with prime customers, promoted the growth of quality assets, adjusted asset structure and improve resilience against recycles. So in summary, we not only control the formation of delinquent assets, but also try to increase the volume and mix of high-quality assets. Thanks to the proactive measures that we have taken, the overall re-fluctuation for both new and existing loans remain under control in the third quarter.

同時，透過提高價格競爭力、優化長期貸款和還款體驗，我們加強了與優質客戶的聯繫，促進了優質資產的成長，調整了資產結構，並提高了抵禦回收風險的能力。總而言之，我們不僅控制不良資產的形成，而且還努力增加優質資產的數量和種類。由於我們採取了積極主動的措施，第三季新貸款和現有貸款的整體波動仍然受到控制。

For the overall loan book, day one delinquency ratio increased by around 5 basis points compared to the second quarter. For new loans, the magnitude of FPD30 [30 interest] is expected to be (inaudible) 5%. Q4 is the first [full] quarter after the implementation of the new regulation so it's expected to be more challenging, not only in risk performance, but also in loan volume and also profit. For the existing loan portfolio based on the latest performance, day one delinquency ratio peaked in October due to the combined impact of the new regulation implementation and the long National Day holiday and then exhibited month-on-month improvement in November, showing signs of stabilization. For new loans, as we further tightened credit criteria in October, we expect FPD30 of loans in October to improve compared to the peak in September. So overall, moving into the month of October, the risk performance of existing loans and new loans, both show signs of stabilization.

與第二季相比，整體貸款組合的首日逾期率上升了約 5 個基點。對於新貸款，FPD30 [30 利息] 的幅度預計為（聽不清楚）5%。第四季度是新規實施後的第一個完整季度，因此預計會更具挑戰性，不僅在風險表現方面，而且在貸款規模和利潤方面也是如此。根據最新業績，現有貸款組合的首日違約率在 10 月達到峰值，這是由於新規實施和國慶長假的綜合影響，然後在 11 月出現環比改善，顯示出穩定跡象。對於新貸款，由於我們在 10 月進一步收緊了信貸標準，我們預計 10 月貸款的 FPD30 將比 9 月的峰值有所改善。因此，總體而言，進入 10 月份，現有貸款和新貸款的風險表現均顯示出穩定跡象。

[Dong Peng Chu], CICC.

[董鵬楚]，中金公司。

(interpreted) And let me just take my questions, and I have two questions. First, what is the outlook and guidance for the fourth quarter and full year 2026 performance? And second question is, as the company has utilized over half of share repurchase quarter, what are the plans for future shareholders' return?

（翻譯）讓我問幾個問題，我有兩個問題。首先，對2026年第四季和全年業績的展望和指導是什麼？第二個問題是，由於該公司已用完超過一半的股票回購額度，未來股東回報的計畫是什麼？

Okay. I guess I will take the first question and ask Jay to take the second. The first one, the fourth quarter is really the first full quarter following the implementation of the new regulation, and our results will be negatively impacted to the similar extent as other leading players in the industry. On the one hand, we ceased facilitated loans with APR above 24% starting October 1. On the other hand, in response to the rising industry-wide risk volatility, we have been proactively controlling the pace of low volume growth. As a result, we expect moderate loan volume decline in the fourth quarter. At the same time, we expect industry-wide risk fluctuation to gradually stabilize towards the end of the quarter. Therefore, along with the industry, our risk indicators will also fluctuate in the fourth quarter, which will push up the credit cost. Affected by these factors, the Q4 net profit will see a sequential decline.

好的。我想我會回答第一個問題，讓傑伊回答第二個問題。第一個季度，也就是第四季度，實際上是新規實施後的第一個完整季度，我們的業績將受到與業內其他領先企業類似的負面影響。一方面，我們從 10 月 1 日起停止提供年利率高於 24% 的貸款。另一方面，為了因應日益加劇的行業風險波動，我們一直在積極控制低銷售成長的速度。因此，我們預計第四季度貸款量將出現溫和下降。同時，我們預期整個產業的風險波動將在本季末逐漸趨於穩定。因此，與行業整體情況一樣，我們的風險指標在第四季度也會出現波動，這將推高信貸成本。受這些因素影響，第四季淨利將季減。

To put things in perspective, it is worth mentioning that in the first 9 months of this year, we have achieved a net profit of RMB1.5 billion, representing a year-over-year growth of 98%, in line with our previous guidance. Although the fourth quarter net profit will see some decline related to the regulation, the company's full year 2025 net profit is still expected to achieve significant year-over-year growth. Looking ahead to 2026. Due to the industry and regulatory uncertainties, it is really hard to pin down a clear guidance at this stage. We are the same pressure as other leading players. For the same reason, the performance in Q4 cannot be simply taken as a base for predicting 2026 profitability. However, I'd like to discuss several key factors that may impact the net profit of 2026, for your reference. One, the overall pricing impact.

為了讓大家更清楚地了解狀況，值得一提的是，今年前9個月，我們實現了淨利15億元人民幣，年增98%，與我們先前的預期一致。儘管受監管影響，第四季度淨利潤將有所下降，但預計該公司 2025 年全年淨利潤仍將實現顯著的同比增長。展望2026年。由於行業和監管方面的不確定性，現階段很難給出明確的指導意見。我們和其他領先企業面臨同樣的壓力。基於同樣的原因，第四季的業績不能簡單地作為預測 2026 年獲利能力的基準。不過，我想討論幾個可能影響 2026 年淨利的關鍵因素，供您參考。第一，整體價格影響。

After the implementation of the new regulations, the interest rate on new loans are all below 24%. As this portion of the new loans accumulate over time, the average pricing on the outstanding loan book will gradually drop below 24%. So the decline in pricing will put some pressure on the net profit. Two, risk stabilization. When the credit risk in this cycle bottoms out -- when this bottoms out, we're really determining when the volume growth and the profitability pick up. So customers with interest rate within 24% exhibit more stable credit risk profile Therefore, their credit costs will be lower, which will help offset the declines in pricing to some extent. Three, funding costs trending down. The temporary tightness in the funding supply in Q3, Q4 were gradually eased as the regulations settle in. Therefore, funding costs are expected to follow a downward trend.

新規實施後，新貸款利率均低於 24%。隨著這部分新貸款的累積，未償貸款組合的平均利率將逐漸降至 24% 以下。因此，價格下跌將對淨利潤造成一定壓力。第二，風險穩定。當本輪週期中的信貸風險觸底反彈時－也就是當信貸風險觸底反彈時，我們才能真正決定銷售成長和獲利能力何時開始回升。因此，利率在 24% 以內的客戶表現出更穩定的信用風險狀況。因此，他們的信貸成本會更低，這將有助於在一定程度上抵消價格下降的影響。第三，融資成本呈下降趨勢。第三季和第四季資金供應暫時緊張的局面隨著監管政策的逐步落實而逐漸緩解。因此，預計融資成本將呈下降趨勢。

And at the same time, with a better quality customers who carry lower risks, funding costs will also be lower. Four, the synergies from ecosystem business, i.e., e-commerce. During this period, our e-commerce business has achieved steady growth, enhancing the company's profitability. Our off-line inclusive finance and the tech empowerment businesses have maintained stable risk performance despite challenging market conditions, enhancing the company's operational resilience. So the continued growth of the company's ecosystem business will further strengthen our operational resilience and boost the overall profitability.

同時，由於客戶品質更高，風險更低，融資成本也會降低。第四，來自生態系業務（即電子商務）的綜效。在此期間，我們的電子商務業務實現了穩步成長，提高了公司的獲利能力。儘管市場環境充滿挑戰，但我們的線下普惠金融和科技賦能業務仍維持了穩定的風險表現，增強了公司的營運韌性。因此，公司生態系統業務的持續成長將進一步增強我們的營運韌性，並提高整體獲利能力。

So in conclusion, Q4 will be a temporary dip in our business and financial numbers due to the regulation. When the recovery will resume depends on the industry risk stabilization and further regulatory certainty. However, given the unique ecosystem business and the past three years turnaround effort, we are confident that we are better positioned than many other players. And we will be the first ones to recover when things are more settled, maybe in the early part of next year or so. That's first question. Jay?

綜上所述，由於監管政策的影響，第四季度我們的業務和財務數據將暫時下滑。復甦何時恢復取決於行業風險的穩定和監管的進一步確定性。然而，鑑於我們獨特的生態系統業務以及過去三年來的轉型努力，我們有信心，我們比許多其他競爭者更有優勢。當局勢更加穩定後，我們將率先復甦，可能在明年年初左右。這是第一個問題。傑伊？

(interpreted) We have been actively executing repurchase program in (inaudible). Both the companies' share repurchase program and our personal share repurchase plan have been more than [halfway] (inaudible), which is well ahead of the original one-year schedule. This fully demonstrates the management's strong confidence in the company's outlook, and reaffirms our commitment and capability to incoming shareholders (inaudible). Company's repurchase program is fully executed, alongside a dividend payout ratio of [30%]. Our total shareholder returns rise above the industry average. The company has always attached high importance on shareholder return. Once the current share repurchase program is fully executed, we will explore more initiatives to further enhance value for shareholders.

（譯文）我們一直積極執行回購計劃（聽不清楚）公司股票回購計畫和我們個人股票回購計畫都已完成過半（聽不清楚），遠遠提前於原定的一年計畫。這充分體現了管理層對公司前景的堅定信心，並再次向即將加入的股東重申了我們的承諾和能力。（聽不清楚）本公司股票回購計畫已全面執行，同時股利支付率也為[此處應填寫具體數值]。[30%]。我們的股東總回報高於產業平均。公司一直高度重視股東回報。當前股份回購計畫全面執行完畢後，我們將探索更多舉措，以進一步提升股東價值。

(inaudible) back to management for closing comments.

（聽不清楚）交由管理階層做總結發言。

Thank you. This conference is now concluded. Thank you for joining today's call. If you have any more questions, please do not hesitate to contact us. Thanks again.

謝謝。本次會議到此結束。感謝您參加今天的電話會議。如果您還有其他疑問，請隨時與我們聯繫。再次感謝。

This concludes today's conference call. Thank you for participating, and you may now disconnect.

今天的電話會議到此結束。感謝您的參與，您現在可以斷開連接了。

Portions of this transcript that are marked (interpreted) were spoken by an interpreter present on the live call. The interpreter was provided by the company sponsoring this event.

本記錄中標有（已翻譯）的部分是由現場通話中的翻譯人員翻譯的。本次活動的翻譯人員由活動贊助公司提供。