LexinFintech Holdings Ltd. (NASDAQ:LX) Q1 2023 Earnings Conference Call May 23, 2023 10:00 PM ET

Company Participants

Jamie Wang - IR Manager

Jay Xiao - Chairman and CEO

James Zheng - CFO

Jared Wu - President

Conference Call Participants

Frank Zheng - Credit Suisse

Alex Ye - UBS

Yada Li - CICC

Operator

Good day and thank you for standing by. Welcome to LexinFintech's First Quarter 2023 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded.

And now I'd like to hand the conference over to Ms. Jamie Wang, IR Manager. Please go ahead ma'am.

Jamie Wang

Thank you. Hello everyone. Welcome to Lexin's first quarter 2023 earnings conference call. With us today on the line today are CEO, Jay Xiao; President, Jared Wu; and CFO, James Zheng.

Before we get started, I'd like to remind you that the call and presentation containing business outlook and forward-looking statements, which are based on the assumptions as of today. The actual results may differ materially and we undertake no obligation to update any forward-looking statements.

Jay will first provide an update on our overall performance, James will cover the financial results in more detail, and lastly, Jared will then discuss risk management.

I'll now turn the call over to our Jay. His remarks will be in Chinese and the English translation will follow. Jay please.

Jay Xiao

[Foreign Language]

Good morning and evening everyone. Its my pleasure to speak with all of you again. In the first quarter, with the gradual recovery of consumption post-pandemic and the continued improvement of the overall macroenvironment, consumer finance started moderate growth as this maintains growth through a two-wheel drive strategy with upgrading and data-driven optimization, we achieved another quarter of strong results.

RMB60.9 billion in loan origination volume, up 41% year-over-year. Total outstanding balance at RMB107 billion, up 28.0% year-over-year. Revenue at RMB2,980 million, up 74.0% year-over-year. Net profit of RMB327 million, an increase of 302% year-over-year.

As demonstrated by the first quarter results, our profitability has continued to improve. With net profit margin rising to 11.0% from 4.8% in the first quarter of last year. And has grown steadily for the fourth consecutive quarters and various operating indicators are moving in a positive direction.

Let me elaborate in more detail. There were three major operational highlights in the first quarter. First, as we enhanced our user risk assessment capabilities, we accelerated our pace in reducing high-risk user segments and therefore improve the overall asset quality.