Jiayin Group ((JFIN)) has held its Q4 earnings call. Read on for the main highlights of the call.
The recent earnings call of Jiayin Group painted a mixed picture, showcasing both significant achievements and challenges. While the company celebrated growth in loan facilitation, borrower acquisition, and technological advancements, these successes were tempered by declines in net revenue and net income, attributed to strategic shifts and increased operational costs. Despite these challenges, Jiayin Group remains optimistic about future growth and profitability, buoyed by enhanced dividend policies and strategic investments.
Strong Loan Facilitation Growth
In the fourth quarter of 2024, Jiayin Group reported a robust increase in loan facilitation, with transactions totaling RMB27.7 billion, marking a 37.8% year-over-year growth. The loan facilitation service revenue also saw a significant rise, reaching RMB1.1 billion, up 46.3% compared to the previous year.
Diverse Borrower Acquisition and Retention
Jiayin Group successfully expanded its borrower base by adding 2.774 million new borrowers in 2024, reflecting a 45.1% year-over-year growth. The company’s efforts in retention were also fruitful, with the annual retention rate increasing by approximately 7%, and a potential churn user retention rate of nearly 75%.
Technological Advancements
The company made notable strides in technological advancements, particularly in AI-powered risk control and customer service. These enhancements included achieving a 90% accuracy rate in real-time tech reminders and significantly improving document recognition efficiency.
Overseas Market Expansion
Jiayin Group’s international ventures showed promising results, especially in Indonesia, where loan volume increased by 74% year-over-year, and registered users grew by 131%. The company also reported optimized risk indicators and improved profitability in the Mexican market.
Increased Dividend Policy
In a move to enhance shareholder returns, Jiayin Group announced plans to increase the annual cash dividend to approximately 30% of the previous fiscal year’s net profit after tax, a significant rise from the previous policy of no less than 15%.
Net Revenue Decline
Despite the growth in other areas, Jiayin Group faced a 12.2% decline in net revenue compared to the same period in 2023. This decrease was primarily due to the strategic downsizing of financial guarantee services.
Decreased Net Income
The company’s net income for Q4 2024 was RMB275.5 million, representing a 25.1% decrease. This decline was attributed to a higher base in 2023 due to a one-off non-operational income.
Increased Marketing and R&D Costs
Jiayin Group’s increased focus on marketing and research and development led to a 57% year-over-year rise in sales and marketing expenses, along with an 8.1% increase in R&D expenses, impacting overall profitability.
Forward-Looking Guidance
Looking ahead, Jiayin Group has set ambitious targets for 2025, with a loan facilitation volume target range of RMB137 billion to RMB142 billion, indicating significant year-over-year growth. For the first quarter of 2025, the company aims for a loan facilitation volume of RMB35 billion and a non-GAAP income from operations target between RMB0.57 billion and RMB0.63 billion. These targets reflect Jiayin’s focus on high-quality growth and profitability, supported by favorable macroeconomic policies.
In conclusion, Jiayin Group’s earnings call revealed a company navigating through both achievements and challenges. While facing declines in net revenue and income, the company remains optimistic about its future, driven by strategic investments, technological advancements, and a commitment to enhancing shareholder returns. The forward-looking guidance suggests a focus on sustainable growth and profitability, positioning Jiayin Group for continued success in the coming year.