X Financial Reports First Quarter 2026 Unaudited Financial Results

SHENZHEN, China, May 27, 2026 /PRNewswire/ -- X Financial (NYSE: XYF), a leading Chinese fintech platform, today announced its unaudited financial results for the first quarter ended March 31, 2026. This press release should be read in conjunction with the Company's Report on Form 6-K for the first quarter ended March 31, 2026, which has been furnished to the U.S. Securities and Exchange Commission and is available on the SEC's website at www.sec.gov and on the Company's investor relations website at http://ir.xiaoyinggroup.com.

First Quarter 2026 Financial and Operational Highlights

Mr. Kent Li, President of X Financial, commented: "In the first quarter of 2026, we facilitated and originated RMB14.6 billion in loans, reflecting a substantial decline of 35.8% from the prior quarter and 58.4% year-over-year. Borrower activity continued to moderate, with active borrowers declining to approximately 956,520, down 60.6% from a year ago, reflecting the Company's deliberate focus on higher-quality origination and tighter credit standards. The 31–60 day delinquency rate eased to 2.61% from 2.90% in the prior quarter, reflecting improvement in more recent origination quality. The 91–180 day rate rose to 9.95%, driven by the migration of existing delinquent balances further into that bucket rather than fresh deterioration in new originations. In response, we have further strengthened our risk management framework, enhanced collection strategies, and adjusted capital deployment to preserve balance sheet resilience. While profitability was significantly impacted by higher provisions and narrower margins, we believe these actions appropriately position the Company for the challenging environment ahead."

Mr. Frank Fuya Zheng, Chief Financial Officer of X Financial, added: "In the first quarter of 2026, total net revenue was RMB1.18 billion, a decrease of 39.3% from the same period last year and 19.9% sequentially. Net income was RMB37.9 million and non-GAAP adjusted net income was RMB81.2 million, both significantly lower than the prior year period, primarily due to substantially higher credit-related provisions and significantly lower loan facilitation revenue amid reduced origination volumes. Basic earnings per ADS were RMB0.96, and non-GAAP adjusted earnings per ADS were RMB2.10. Operating margin improved to 12.0% from 1.4% in the prior quarter, though remained significantly below the 29.6% recorded in the same period of 2025, reflecting the ongoing impact of elevated credit costs and reduced contribution from higher-margin facilitation services. We will continue to manage capital conservatively, strengthen our balance sheet, and maintain cost discipline to support business resilience amid an evolving regulatory and operating landscape."

[1] Represents the total amount of loans that the Company facilitated and originated during the relevant period.

First Quarter 2026 GAAP and Non-GAAP Financial Summary

(In thousands, except for share and per share data)

Three Months Ended

March 31, 2025

Three Months Ended

December 31, 2025

Three Months Ended

March 31, 2026

QoQ

YoY

RMB

Total net revenue

1,937,505

1,467,843

1,176,139

(19.9 %)

(39.3 %)

Total operating costs and expenses

(1,364,600)

(1,447,660)

(1,035,481)

(28.5 %)

(24.1 %)

Income from operations

572,905

20,183

140,658

596.9 %

(75.4 %)

Net income

458,127

57,167

37,947

(33.6 %)

(91.7 %)

Non-GAAP adjusted net income

466,766

61,320

81,180

32.4 %

(82.6 %)

Net income per ADS—basic

10.92

1.44

0.96

(33.3 %)

(91.2 %)

Net income per ADS—diluted

10.56

1.44

0.96

(33.3 %)

(90.9 %)

Non-GAAP adjusted net income per ADS—basic

11.10

1.56

2.10

34.6 %

(81.1 %)

Non-GAAP adjusted net income per ADS—diluted

10.74

1.56

2.04

30.8 %

(81.0 %)

Business Outlook & Capital Return

Regulatory Update

The regulatory environment governing internet-based lending in the People's Republic of China continued to evolve during the first quarter of 2026, with authorities further strengthening oversight across the consumer credit business chain. The Company continues to monitor these developments closely; however, management has limited visibility into the ultimate scope and direction of implementation. If current and emerging regulatory requirements are implemented as currently understood, the Company's operating results may be materially and adversely affected, and historical levels of profitability should not be assumed to be indicative of future performance.

Conference Call

X Financial's management team will host an earnings conference call at 7:30 AM U.S. Eastern Time on May 28, 2026 (7:30 PM Beijing / Hong Kong Time on May 28, 2026).

Dial-in details for the earnings conference call are as follows:

United States:

1-888-346-8982

Hong Kong:

800-905945

Mainland China:

4001-201203

International:

1-412-902-4272

Passcode:

X Financial

Please dial in ten minutes before the call is scheduled to begin and provide the passcode to join the call.

A replay of the conference call may be accessed by phone at the following numbers until June 04, 2026:

United States:

1-855-669-9658

International:

1-412-317-0088

Passcode:

1485675

Additional Information

This press release contains highlights only. For the Company's complete financial results and management's discussion and analysis for the first quarter ended March 31, 2026, please refer to the Form 6-K filed with the U.S. Securities and Exchange Commission on May 27, 2026.

About X Financial

X Financial (NYSE: XYF) (the "Company") is a leading Chinese fintech platform. The Company is committed to connecting borrowers on its platform with its institutional funding partners. With its proprietary big data-driven technology, the Company has established strategic partnerships with financial institutions across multiple areas of its business operations, enabling it to facilitate and originate loans to prime borrowers under a risk assessment and control system.

For more information, please visit http://ir.xiaoyinggroup.com.

Use of Non-GAAP Financial Measures

In evaluating our business, we consider and use non-GAAP measures as supplemental measures to review and assess our operating performance. We present the non-GAAP financial measures because they are used by our management to evaluate our operating performance and formulate business plans. We believe that the use of the non-GAAP financial measures facilitates investors' assessment of our operating performance and help investors to identify underlying trends in our business that could otherwise be distorted by the effect of certain income or expenses that we include in income (loss) from operations and net income (loss). We also believe that the non-GAAP measures provide useful information about our core operating results, enhance the overall understanding of our past performance and future prospects and allow for greater visibility with respect to key metrics used by our management in its financial and operational decision-making.

We use in this press release the following non-GAAP financial measures: (i) adjusted net income (loss), (ii) adjusted net income (loss) per basic ADS, (iii) adjusted net income (loss) per diluted ADS, (iv) adjusted net income (loss) per basic share, and (v) adjusted net income (loss) per diluted share, each of which excludes share-based compensation expense, impairment losses on financial investments, income (loss) from financial investments, gain (loss) from financial investments at equity method and impairment losses on long-term investments. These non-GAAP financial measures have limitations as analytical tools, and when assessing our operating performance, investors should not consider them in isolation, or as a substitute for the financial information prepared and presented in accordance with U.S. GAAP.

We mitigate these limitations by reconciling the non-GAAP financial measures to the most directly comparable U.S. GAAP financial measures, which should be considered when evaluating our performance. We encourage you to review our financial information in its entirety and not rely on a single financial measure.

For more information on these non-GAAP financial measures, please see the table captioned "Unaudited Reconciliations of GAAP and Non-GAAP results" set forth at the end of this press release.

Exchange Rate Information

This press release contains translations of certain RMB amounts into U.S. dollars at specified rates solely for the convenience of the reader. Unless otherwise noted, all translations from RMB to U.S. dollars are made at a rate of RMB6.8980 to US$1.00, the exchange rate in effect as of March 31, 2026, as published in the Federal Reserve Board's H.10 statistical release. Percentages stated in this release are calculated based on the RMB amounts.

Disclaimer

Safe Harbor Statement

This announcement contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates," "potential," "continue," "ongoing," "targets," "guidance" and similar statements. The Company may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission (the "SEC"), in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Any statements that are not historical facts, including statements about the Company's beliefs and expectations, are forward-looking statements that involve factors, risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Such factors and risks include, but not limited to the following: the Company's goals and strategies; its future business development, financial condition and results of operations; the expected growth of the credit industry, and marketplace lending in particular, in China; the demand for and market acceptance of its marketplace's products and services; its ability to attract and retain borrowers and investors on its marketplace; its relationships with its strategic cooperation partners; competition in its industry; and relevant government policies and regulations relating to the corporate structure, business and industry. Further information regarding these and other risks, uncertainties or factors is included in the Company's filings with the SEC. All information provided in this announcement is current as of the date of this announcement, and the Company does not undertake any obligation to update such information, except as required under applicable law.

Use of Projections

This announcement also contains certain financial forecasts (or guidance) with respect to the Company's projected financial results. The Company's independent auditors have not audited, reviewed, compiled or performed any procedures with respect to the projections or guidance for the purpose of their inclusion in this announcement, and accordingly, they did not express an opinion or provide any other form assurance with respect thereto for the purpose of this announcement. This guidance should not be relied upon as being necessarily indicative of future results. The assumptions and estimates underlying the prospective financial information are inherently uncertain and are subject to a wide variety of significant business, economic and competitive risks and uncertainties that could cause actual results to differ materially from those contained in the prospective financial information. Accordingly, there can be no assurance that the prospective results are indicative of the future performance of the Company, or that actual results will not differ materially from those set forth in the prospective financial information. Inclusion of the prospective financial information in this announcement should not be regarded as a representation by any person that the results contained in the prospective financial information will actually be achieved. You should review this information together with the Company's historical information.

For more information, please contact:

X Financial

Mr. Noah Kauffman (Chief Financial Strategy Officer)

E-mail: [email protected]

X Financial

Unaudited Condensed Consolidated Balance Sheets

(In thousands, except for share and per share data)

As of December 31,

2025

As of March 31,

2026

As of March 31, 2026

RMB

USD

ASSETS

Cash and cash equivalents

987,631

1,021,230

148,047

Restricted cash, net

1,145,962

1,348,104

195,434

Accounts receivable and contract assets, net

3,145,976

2,498,233

362,168

Loans receivable from Credit Loans and other loans, net

5,298,631

4,318,579

626,062

Deposits to institutional cooperators, net

1,713,593

1,409,915

204,395

Prepaid expenses and other current assets

43,547

37,906

5,495

Deferred tax assets, net

455,358

506,794

73,470

Long term investments

515,524

522,389

75,731

Property and equipment, net

23,900

26,426

3,831

Intangible assets, net

39,183

38,839

5,630

Financial investments

1,243,076

1,825,817

264,688

Other non-current assets

53,364

52,244

7,574

TOTAL ASSETS

14,665,745

13,606,476

1,972,525

LIABILITIES

Payable to investors and institutional funding partners at amortized cost

3,054,982

2,407,547

349,021

Contingent guarantee liabilities

748,307

590,611

85,621

Deferred guarantee income

467,629

388,880

56,376

Financial guarantee derivative

15,426

14,505

2,103

Short-term borrowings

409,530

353,871

51,301

Accrued payroll and welfare

76,058

30,703

4,451

Other tax payable

221,940

207,591

30,094

Income tax payable

677,521

749,170

108,607

Accrued expenses and other current liabilities

1,053,071

895,929

129,882

Dividend payable

73,919

10,716

Other non-current liabilities

34,807

32,854

4,763

Deferred tax liabilities

69,673

92,339

13,386

TOTAL LIABILITIES

6,828,944

5,837,919

846,321

Commitments and Contingencies

Equity:

Common shares (234,517,901 and 231,097,037 shares outstanding as of December 31, 2025

and March 31, 2026, respectively)

207

Treasury stock

(967,773)

(988,210)

(143,260)

Additional paid-in capital

3,256,349

3,257,252

472,202

Retained earnings

5,484,294

5,448,322

789,841

Other comprehensive income

63,724

50,986

7,391

TOTAL EQUITY

7,836,801

7,768,557

1,126,204

TOTAL LIABILITIES AND EQUITY

14,665,745

13,606,476

1,972,525

X Financial

Unaudited Condensed Consolidated Statements of Comprehensive Income

Three Months Ended March 31,

(In thousands, except for share and per share data)

2025

2026

RMB

USD

Net revenues

Loan facilitation service

1,078,379

270,714

39,245

Post-origination service

266,041

196,206

28,444

Financing income

310,140

337,774

48,967

Guarantee income

82,929

258,294

37,445

Other revenue

200,016

113,151

16,403

Total net revenue

1,937,505

1,176,139

170,504

Operating costs and expenses:

Origination and servicing

473,725

485,364

70,363

Borrower acquisitions and marketing

709,007

219,760

31,859

General and administrative

51,744

47,121

6,831

Provision for accounts receivable and contract assets

9,048

30,778

4,462

Provision for loans receivable

62,196

52,326

7,586

Provision for contingent guarantee liabilities

63,748

200,009

28,995

Change in fair value of financial guarantee derivative

(5,417)

340

Provision for (reversal of) credit losses for deposits and other financial assets

549

(217)

(31)

Total operating costs and expenses

1,364,600

1,035,481

150,114

Income from operations

572,905

140,658

20,390

Interest income

2,922

7,314

1,060

Interest expenses

(5,641)

(2,067)

(300)

Foreign exchange (loss) gain

(12,482)

3,023

438

Loss from financial investments

(3,678)

(1,878)

(272)

Impairment losses on financial investments

(6,715)

(973)

Other income, net

1,935

(3,491)

(506)

Income before income taxes

555,961

136,844

19,837

Income tax expense

(116,528)

(72,204)

(10,467)

(Loss) gain from equity in affiliates, net of tax

(2,182)

5,107

740

Gain (loss) from financial investments at equity method, net of tax

20,876

(31,800)

(4,610)

Net income

458,127

37,947

5,500

Less: net income attributable to non-controlling interests

Net income attributable to X Financial shareholders

458,127

37,947

5,500

Net income

458,127

37,947

5,500

Other comprehensive income, net of tax of nil:

Gain from equity in affiliates

Loss from financial investments

(768)

Foreign currency translation adjustments

(198)

(12,780)

(1,853)

Comprehensive income

457,161

25,209

3,653

Less: comprehensive income attributable to non-controlling interests

Comprehensive income attributable to X Financial shareholders

457,161

25,209

3,653

Net income per share—basic

1.82

0.16

0.02

Net income per share—diluted

1.76

0.16

0.02

Net income per ADS—basic

10.92

0.96

0.14

Net income per ADS—diluted

10.56

0.96

0.14

Weighted average number of ordinary shares outstanding—basic

252,292,800

234,143,092

Weighted average number of ordinary shares outstanding—diluted

260,864,033

236,519,179

X Financial

Unaudited Reconciliations of GAAP and Non-GAAP Results

Three Months Ended March 31,

(In thousands, except for share and per share data)

2025

2026

RMB

USD

GAAP net income

458,127

37,947

5,500

Less: Income (loss) from financial investments (net of tax of nil)

(3,678)

(1,878)

(272)

Less: Impairment losses on financial investments (net of tax of nil)

(6,715)

(973)

Less: Impairment losses on long-term investments (net of tax)

Less: Gain (loss) from financial investments at equity method (net of tax of nil)

20,876

(31,800)

(4,610)

Add: Share-based compensation expenses (net of tax of nil)

25,837

2,840

412

Non-GAAP adjusted net income

466,766

81,180

11,767

Non-GAAP adjusted net income per share—basic

1.85

0.35

0.05

Non-GAAP adjusted net income per share—diluted

1.79

0.34

0.05

Non-GAAP adjusted net income per ADS—basic

11.10

2.10

0.30

Non-GAAP adjusted net income per ADS—diluted

10.74

2.04

0.30

Weighted average number of ordinary shares outstanding—basic

252,292,800

234,143,092

Weighted average number of ordinary shares outstanding—diluted

260,864,033

236,519,179

SOURCE X Financial