Key Points
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LexinFintech posted higher Q1 loan volume and revenue, with total loan volume up 15.9% sequentially to RMB 57.9 billion and revenue reaching RMB 3.3 billion. Active users and new active users also grew sharply, showing continued platform expansion.
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Diversified ecosystem businesses helped offset weakness in online consumer finance, as installment e-commerce, offline inclusive finance and fintech empowerment made up nearly half of total loan volume. Management said these segments are becoming key growth drivers and supporting long-term asset quality.
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Asset quality and risk metrics improved during the quarter, with delinquency trends and collection rates getting better as industry regulation pressures eased. However, net income still fell 5.9% sequentially to RMB 201 million because operating expenses increased and online consumer finance remained under pressure.
LexinFintech (NASDAQ:LX) reported higher first-quarter loan volume and revenue as management said growth in its diversified ecosystem businesses helped offset pressure in online consumer finance amid macroeconomic and industry challenges.
On the company’s first-quarter 2026 earnings call, Chairman and Chief Executive Officer Jay Wenjie Xiao said Lexin’s installment e-commerce, offline inclusive finance and fintech empowerment businesses accounted for nearly 50% of total loan volume during the quarter. He described those businesses as new growth drivers and said they showed “strong operational resilience” in a challenging environment.
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Lexin reported total loan volume of RMB 57.9 billion, up 15.9% quarter over quarter and 12.2% year over year. Revenue reached RMB 3.3 billion, while net profit was RMB 201 million. Active users totaled 5.17 million, up 14.1% sequentially and 8.6% from a year earlier. New active users reached 1.44 million, rising 63.3% quarter over quarter and 101.6% year over year.
Diversified businesses offset consumer finance pressure
Xiao said the company’s diversified ecosystem strategy is beginning to show results, with ecosystem businesses growing faster than the online loan facilitation business. He highlighted fintech empowerment, installment e-commerce and offline inclusive finance as areas that added momentum in the quarter.
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Chief Financial Officer James Zheng said the industry continued to operate through a period of adjustment, and Lexin’s online consumer finance business remained under pressure from macroeconomic uncertainty. However, he said growth in ecosystem segments, particularly fintech empowerment services, supported total loan volume.
Zheng said non-online consumer finance gross merchandise volume, including offline inclusive finance, fintech empowerment services and e-commerce, grew to nearly 50% of total GMV and was up 42% sequentially. He said the fintech empowerment, or ShuKe, model involved partnerships with internet platforms and banks on risk assessment and credit risk assumption, with loan volume rising to around RMB 31 billion.
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“The build-up of the ShuKe model creates a robust revenue pipeline, and it will improve our long-term asset quality and ensure steady profitability across market cycles,” Zheng said.
E-commerce gross profit rises as company prioritizes asset quality
Lexin’s installment e-commerce business also contributed to the quarter’s performance. Xiao said the business expanded its supply chain and product offerings across categories including food, apparel, transportation, travel, shopping, entertainment and pets. During the quarter, the company added nearly 150 brands and launched an outlet channel for select merchants, signing more than 20 domestic and international fashion and sports brands.
Zheng said installment e-commerce GMV remained steady at RMB 2.2 billion, while gross profit from the business reached RMB 208 million, up 24% sequentially. Gross margin expanded by 169 basis points to 9.4%.
Management said the company deliberately moderated growth in the segment to keep credit risk within its risk appetite, even as demand remained strong.
Risk indicators continue to improve
Chief Risk Officer Arvin Zhanwen Qiao said Lexin’s asset quality improved in the first quarter as the impact of new industry regulations gradually subsided and industry-wide risk began to decline. Compared with the fourth quarter of 2025, Lexin’s day-one delinquency ratio for total assets declined by about 7%, while the 30-day collection rate continued to recover month over month. Qiao said FPD30 for new loans originated in the first quarter is expected to decline by about 6%.
Qiao said the company expanded the use of large models in risk management, including upgrades to high-risk asset management tools and automated risk inspection systems. He also said Lexin used large models to support real-time interactive credit line increases, helping the company better identify risk and tailor credit offers.
The company also focused on prime white-collar customers and small and microbusiness owners. Qiao said loan volume from prime white-collar customers rose 56% quarter over quarter, while volume from prime small and microbusiness customers increased 30%.
In offline inclusive finance, Qiao said Lexin continued to develop county-level markets through localized risk models and credit strategies. He said the company has covered nearly 100 counties and served more than 4 million small and micro merchants and individual operators, while maintaining stable risk performance.
Financial results show higher revenue, lower net income
Zheng said net revenue from the credit business, after credit costs and funding costs, was RMB 1.5 billion, up 7.2% sequentially. He said the increase was largely driven by a RMB 382 million rise in tech empowerment service income, supported by lower provision top-ups as asset quality improved. Credit facilitation service income declined by about 10%, or RMB 253 million, reflecting volume and pricing headwinds in online consumer finance.
Total net revenue from the credit and installment e-commerce businesses was RMB 1.7 billion, up 9.1% quarter over quarter. Operating expenses rose 13.8% to RMB 1.4 billion, mainly due to higher sales and marketing expenses and investments in user engagement, service infrastructure, consumer protection and user experience. Net income fell 5.9% sequentially to RMB 201 million.
Lexin’s total credit cost was RMB 1.3 billion, up 0.8% sequentially. Zheng said the increase was primarily volume-driven and aligned with new loan origination growth. He said the company’s gross provision ratio for new capital-heavy loans was about 7.2%, and its coverage ratio was 258% in the first quarter.
As of March 31, Lexin’s cash position, including cash equivalents and restricted cash, was approximately RMB 3.3 billion.
Management remains cautious on outlook and buybacks
In response to analyst questions, Xiao said the industry is becoming more mature and organized, with greater emphasis on compliance and user experience. He said Lexin will continue to focus on customer experience, high-quality assets, asset mix optimization and risk resilience while developing its diversified ecosystem businesses.
Zheng declined to provide specific full-year financial targets, citing macroeconomic uncertainty. He said total loan volume is expected to remain relatively stable quarter over quarter, supported by ecosystem businesses, though online consumer finance may remain under pressure. He said credit costs should come down if risk continues to decline, assuming no major macroeconomic or regulatory changes.
On shareholder returns, Xiao said Lexin plans to cancel 20 million American depositary shares, representing about 12% of total outstanding shares. He said the company has temporarily suspended new share repurchases because of macro uncertainty but may restart the program when market conditions are appropriate.
About LexinFintech (NASDAQ:LX)
LexinFintech Holdings Ltd. (NASDAQ: LX) is a China-based consumer finance and digital banking platform primarily serving young, underbanked consumers. The company’s core offering is point-of-sale installment financing, enabling eligible customers to split purchases into fixed monthly payments with transparent fees. Leveraging proprietary data analytics and credit scoring models, LexinFintech underwrites consumer loans for online purchases and provides credit lines that support a variety of retail and e-commerce transactions.
In addition to its flagship installment loan service, LexinFintech has developed wealth management and fintech-as-a-service products.
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The article “LexinFintech Q1 Earnings Call Highlights” was originally published by MarketBeat.
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