雅虎香港財經 UP Fintech Holding Limited (NASDAQ:TIGR) Q4 2023 Earnings Call Transcript
UP Fintech Holding Limited (NASDAQ:TIGR) Q4 2023 Earnings Call Transcript March 20, 2024
UP Fintech Holding Limited misses on earnings expectations. Reported EPS is $-0.01 EPS, expectations were $0.07. TIGR isn't one of the 30 most popular stocks among hedge funds at the end of the third quarter (see the details here).
Operator: Ladies and gentlemen, thank you for standing by, and welcome to UP Fintech Holding Limited Fourth Quarter and Full Year 2023 Earnings Conference Call. At this time, all participants are in a listen-only mode. There will be a presentation followed by a question-and-answer session. I must advise you that today's conference is being recorded today, March 20, 2024. I would now like to hand the conference over to your first speaker today, Mr. Aaron Li, the Head of Investor Relations. Thank you. Please go ahead.
Aaron Li: Thank you, operator. Hello everyone and thank you for joining us for the call today. UP Fintech Holding Limited's fourth quarter and full year 2023 earnings release was distributed earlier today and is available on IR website at ir.itigerup.com, as well as GlobeNewswire services. On the call today from UP Fintech are Mr. Wu Tianhua, Chairman and Chief Executive Officer; Mr. John Zeng, Chief Financial Officer; Mr. Huang Lei, CEO of U.S. Tiger Securities; and Mr. Kenny Zhao, our Financial Controller. Mr. Wu will give an overview of our business operations and discuss corporate highlights. Mr. Zeng will then discuss our financial results. They will both be available to answer your questions during the Q&A session that follows their remarks.
Now let me cover the Safe Harbor. Some statements we are about to make contain forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement. For more information about factors that could cause actual results to materially differ from those in the forward-looking statements, please refer to our Form 6-K furnished today, March 20, 2024 and our Annual Report on Form 20-F filed on April 26, 2023. We undertake no obligation to update any forward-looking statement except as required under applicable law. It is my pleasure to now introduce our Chairman and Chief Executive Officer, Mr. Wu. Mr. Wu will make remarks in Chinese which will be followed by English translation.
Mr. Wu, please go ahead with your remarks.
Tianhua Wu: [Foreign Language] Hello everyone. Thank you for joining the Tiger Brokers' fourth quarter and full year 2023 earnings conference call. Today marks the 5th Anniversary of Tiger’s listing on NASDAQ. During the past five years, we committed to our mission that technology redefines global investing and have expanded our business globally to Singapore, Southeast Asia, Australia, New Zealand, the United States, Hong Kong, and the United Kingdom. We have made significant improvement in various aspects, including product offering, industry know-how, user base, and profitability. We have also navigated through market turbulence, geopolitical and regulatory uncertainties. This valuable experience will help us to have sustainable growth in the future.
As of the end of 2023, the majority of our total client assets came from users in overseas markets. We are proud of our international reach and will continue to serve our clients with dedication and innovation. [Foreign Language] In 2023, we continue to advance our internationalization strategy, further solidifying our leading position in Singapore and officially enter Hong Kong. Benefiting from the higher interest rate environment, fourth quarter total revenue reached US $70 million, a 9.6% increase compared to the same period of last year. Our full year total revenue amounted to US $273 million, representing a 21% increase from 2022. Additionally, we saw significant improvement in our bottom line in 2023, primarily due to our brand strength and R&D capabilities, which enabled us to save costs and deploy resources more efficiently.
Full year net profit reached US $32.6 million, non-GAAP net profit reached US $42.7 million, a record high since our company founding and representing a jump of 14.8 times and 3.4 times of the same figure in 2022. In the fourth quarter, due to depreciation of U.S. dollar against other currency, we recorded a US $7 million non-cash foreign exchange loss versus a US $2 million foreign exchange gain in the third quarter, resulting our non-GAAP net income decline quarter-by-quarter to US $1.1 million. [Foreign Language] In the fourth quarter we added 39,000 funded accounts, an increase of 58.6% from the previous quarter. The total number of funded accounts for the year reached 123,110, exceeding our annual guidance of 100,000 funded accounts. This majority came from markets outside of Mainland China.
The total number of funded accounts at the end of 2023 exceeded 900,000, representing a growth of 15.8% compared to the end of last year. In the fourth quarter, by leveraging our strong presence in the Singapore, we were working with partners to explore customer acquisition initiatives in the Southeast Asian region, which resulted in a rise in quarterly new funded accounts while reducing average CAC to a historical low of below US $150. In terms of total client assets, the trend of asset inflow remains strong. We saw a record US $8.2 billion net asset inflow this quarter, in addition to US $3.5 billion from market-to-market gain. Total client assets jumped 62.1% quarter-over-quarter and more than doubled year-over-year, to US $30.6 billion at the end of 2023.
The increase in client assets was primarily due to our ongoing product development to meet the needs of institutional clients. Additionally, we are very glad to see the quality of our newly acquired customers further improved in the fourth quarter. The average net asset inflow of newly acquired clients in Singapore was above US $16,000 in the fourth quarter, setting a historic high since our launch into the Singapore retail market. [Foreign Language] We continuance to add new products on our platform, to enhance user experience, which we believe is the key to our long-term success. In the fourth quarter, we introduced Combo Option Strategy feature, a very user-friendly product that allows users to execute multi-leg options traits based on our net margin requirements.
Additionally, we launched the Fixed Coupon Notes product, offering professional investors a more diversified wealth management experience. In addition, as crypto is becoming an important asset class globally, it's a natural extension of business as broker-dealer to add this new asset class with Tiger's Fintech background and know-how. In January, we started to offer 11 Bitcoin ETFs trading based on local regulatory frameworks. In Hong Kong, Hong Kong SFC uplifted our Type 1 License, to include Virtual Asset dealing services for Professional Investors. This positions us as one of the first mainstream online brokerage firms in Hong Kong to receive approval for such a license upgrade. [Foreign Language] Our 2B business continues to perform well.
In Investment Banking Service, we underwrote a total of nine U.S. and Hong Kong IPOs in the fourth quarter, including Shiyue Daotian Group and J&T Express, bringing the total number of U.S. and Hong Kong IPOs underwritten for the year to 28. In our ESOP business, we added 30 new clients in the fourth quarter, bringing the total number of ESOP clients served to 535 as of the end of 2023. Now, I would like to invite our CFO, John, to go over our financials.
John Zeng: Great. Thanks, Tianhua and Aaron. Let me go through our financial performance for the fourth quarter. All numbers are in U.S. dollar. Total revenue was $70 million this quarter, remain last quarter-over-quarter, and increased 9.6% year-over-year. Full year total revenue were $272.5 million, increased 20.9% compared to last year. Cash equity take rate was 6.5 bps this quarter, slightly increased from last quarter. Within commission revenue, about 60% come from cash equities, 30% from options, and the rest comes from futures and other products. Now on to cost. Interest expense was $16 million, increased by 123% from same quarter of last year, as interest expense and securities lending expense both increased in line with the rate hike.
Execution and clearing expense were $2.2 million, decreased to 44% from the same quarter of last year, primarily due to more efficiency in self-clearing for U.S. and Hong Kong Securities. Employee compensation and benefits expense were $26.5 million, an increase of 8% year-over-year due to an increase of global headcounts. Occupancy depreciation and amortization expense increased 8.4% to $2.2 million due to increase in rent. Communication and data expense were $8.5 million, an increase of 21% year-over-year due to the increase in user base and IT related fees.
remember: Total operating costs were $52.5 million, slightly increased 3.1% from the same quarter of last year. GAAP net loss was $1.8 million. Non-GAAP net income was $1.1 million. The sequential drop in bottom line was primarily due to a non cash foreign exchange losses resulted from the depreciation of the U.S. dollar during this quarter. For the year of 2023, total GAAP profit was $32.6 million and non-GAAP net income was $42.7 million, a historical high in our company history. Now I have concluded our presentation. Operator, please open the line for Q&A, thanks.
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