Lexinfintech Holdings Ltd

Lexinfintech Holdings Ltd (NASDAQ: LX) primarily provides consumer finance technology services. The company leverages technologies such as artificial intelligence and big data to build an online risk assessment and management platform, enabling quantitative decision-making processes.

Key Business Updates

• Strong Quarterly Performance: LexinFintech Holdings Ltd. delivered solid results in the second quarter of 2025, reinforcing its operational resilience amid external uncertainties. Revenue grew 16% sequentially to RMB3.6 billion, while net income rose 19% quarter-over-quarter to RMB511 million, marking the highest level in the past 14 quarters. Loan origination also reached RMB53 billion, reflecting a 2.4% increase from the previous quarter.
• Expanding User Base: The company’s customer base continued to expand, with total registered users reaching 236 million as of June 30, 2025, representing 7.9% growth from the prior year. Users with credit lines rose to 47.2 million, up 8.9% year-over-year, while active loan product users increased 12.6% to 4.7 million during the quarter. Cumulative borrowers with successful drawdowns also climbed 8.2% to 35.2 million.
• Loan Facilitation and Credit Performance: By June 2025, Lexin’s cumulative loan originations reached RMB1,429.6 billion, a 17% rise compared to a year earlier. Total loan originations in Q2 stood at RMB52.9 billion, a 3.5% year-over-year increase. The company maintained stable credit quality, with the 90+ day delinquency ratio improving to 3.1% from 3.3% in the previous quarter, while first payment default rates remained below 1%.
• Growth in E-commerce Platform: Lexin’s installment-based e-commerce platform demonstrated strong momentum, with gross merchandise volume (GMV) doubling year-over-year to RMB2,029 million in Q2 2025. The platform served over 460,000 users and partnered with approximately 180 merchants, highlighting growing adoption. Repeated borrowers contributed 86.1% of loan volume, underscoring strong customer retention.
• Revenue Mix and Segment Performance: Total operating revenue for the quarter was RMB3,587 million, down 1.5% from the prior year. Within this, credit facilitation service income declined 15% year-over-year to RMB2,270 million, while tech-empowerment services surged 55.3% to RMB830 million. Installment e-commerce service income increased 11.5% to RMB487 million. Net income attributable to shareholders more than doubled year-over-year, reaching RMB511 million, with adjusted net income at RMB541 million.
• Expense and Profitability Trends: The company reported gross profit of RMB1,273 million in Q2, compared to RMB1,348 million a year earlier. Sales and marketing expenses rose to RMB567 million, reflecting higher advertising costs, while research and development spending increased to RMB158 million, driven by continued investment in technology. Funding costs decreased significantly to RMB59.9 million, aided by lower borrowing rates. Notably, Lexin recorded a RMB184 million fair value gain, reversing a prior-year loss, further boosting profitability.
• Shareholder Returns and Outlook: Reaffirming its commitment to shareholder value, Lexin declared a semi-annual dividend of USD 0.194 per ADS, equivalent to 25% of first-half net income. Starting in the second half of 2025, the dividend payout ratio will rise to 30% of net income. Additionally, the company launched a USD 50 million share repurchase program, complemented by a planned personal ADS purchase of up to USD 10 million by its CEO. Looking forward, management maintained its full-year guidance of strong net income growth despite macroeconomic uncertainties, supported by continued focus on asset quality and operational efficiency.

Technical Observation (on the daily chart):

The stock is currently consolidating between USD 6.20 and USD 6.80 after a prolonged downtrend from its April highs. Both the 21-day and 50-day moving averages are flat and closely aligned, reflecting indecision, while the RSI near 48 suggests neutral momentum.

LexinFintech Holdings Ltd. delivered a strong Q2 FY2025 performance, with net income surging 126% year-over-year to RMB511 million and adjusted net income reaching RMB541 million. The company achieved healthy growth in its user base, loan originations, and installment e-commerce platform, while maintaining stable credit quality with a lower delinquency ratio. Strong momentum in tech-empowerment services, disciplined cost management, and shareholder-friendly actions such as higher dividend payouts and a USD 50 million share repurchase program underscore Lexin’s strengthening fundamentals and commitment to long-term value creation.

As per the above-mentioned price action, recent key business and financial updates, momentum in the stock over the last month, and technical indicators analysis, a ‘Buy’ rating has been given to Lexinfintech Holdings Ltd (NASDAQ: LX) at the current market price of USD 6.55 as of Aug 21,2025 at 8:15 am PDT. 

Individuals can evaluate the stock based on the support and resistance levels provided in the report in case of keen interest taking into consideration the risk-reward scenario. 

Markets are trading in a highly volatile zone currently due to certain macro-economic issues and prevailing geopolitical tensions. Therefore, it is prudent to follow a cautious approach while investing.

Related Risk: This report may be looked at from a high-risk perspective and a recommendation is provided for a short duration. This report is solely based on technical parameters, and the fundamental performance of the stocks has not been considered in the decision-making process. Other factors which could impact the stock prices include market risks, regulatory risks, interest rates risks, currency risks, social and political instability risks etc. 

Note 1: Past performance is not a reliable indicator of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance level is August 21,2025. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Note 4: Target Price refers to a price level that the stock is expected to reach as per the relative valuation method and or technical analysis taking into consideration both short-term and long-term scenarios.

Note 5: ‘Kalkine reports are prepared based on the stock prices captured either from the New York Stock Exchange (NYSE), NASDAQ Capital Markets (NASDAQ), and or REFINITIV. Typically, all sources (NYSE, NASDAQ, or REFINITIV) may reflect stock prices with a delay which could be a lag of 15-20 minutes. There can be no assurance that future results or events will be consistent with the information provided in the report. The information is subject to change without any prior notice.