X Financial Shifts to Risk-First Approach: Third Quarter Revenue Drops 13.7% Amid Strategic Change

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X Financial Shifts to Risk-First Approach: Third Quarter Revenue Drops 13.7% Amid Strategic Change

Bitget-RWA2025/11/23 08:04

By:Bitget-RWA

- X Financial reported 23.9% YoY revenue growth to RMB1.96B in Q3 2025, but saw 13.7% sequential decline due to cautious lending and risk prioritization. - Net income rose 12.1% annually to RMB421M but fell 20.2% sequentially, driven by higher credit provisions and operating costs. - Share repurchases under $100M buyback program totaled $67.9M, with $48M remaining as the company emphasizes disciplined risk management. - Strategic pivot to risk mitigation contrasts with broader fintech sector caution, refle

X Financial (NYSE: XYF)

released Q3 2025 results that were mixed

, as annual revenue growth was counterbalanced by a quarter-over-quarter decrease due to slowing borrower demand and increased credit expenses. The fintech company reported total net revenue of RMB1.96 billion for the quarter,

marking a 23.9% rise compared to the same quarter in 2024

but a 13.7% reduction from Q2 2025. Net profit climbed 12.1% year-over-year to RMB421.24 million, yet dropped 20.2% from the previous quarter,

mainly due to greater provisions for credit losses and higher operating costs

Non-GAAP adjusted net profit fell 26.1% from the prior quarter

to RMB438.18 million, though this was a 1.0% improvement over last year.

The company

linked the quarter-over-quarter revenue drop

to a more conservative lending approach and intentional slowdown in loan expansion to safeguard asset quality and manage risk.

X Financial

anticipates loan originations in Q4 2025 to fall between RMB21.0–23.0 billion, with total originations for 2025

estimated at RMB128.8–130.8 billion

. This cautious expansion

comes after a 13.7% quarter-over-quarter revenue decrease

in Q3 and highlights the company’s emphasis on prudent risk controls.

X Financial Shifts to Risk-First Approach: Third Quarter Revenue Drops 13.7% Amid Strategic Change image 0

Returning value to shareholders remained a central focus

, as X Financial bought back 4.26 million ADSs for US$67.9 million under its US$100 million repurchase plan since January 2025. The buyback, set to end in November 2026, still has US$48.0 million available

as reported by Marketscreener

. Company leadership expressed optimism about sustained growth and enhancing shareholder returns, though future buybacks will depend on market trends.

At the same time,

Bank of America revised its commitments

in November 2025, which included switching a direct-pay letter of credit for Illinois Finance Authority bonds to JPMorgan Chase Bank. The bank also arranged $1.45 billion in financing for BX Commercial Mortgage Trust 2025-JDI, with Fitch Ratings providing initial assessments. These developments illustrate ongoing momentum in commercial real estate and credit markets, although

X Financial’s performance points to increased caution in the fintech industry

as credit risks remain elevated.

X Financial’s earnings per ADS dropped from the previous quarter but improved year-over-year, with basic EPS at RMB10.56 for Q3 2025,

up 34.4% from Q3 2024

. The company’s shares traded at a forward P/E of 25, down from 38 three months earlier,

indicating investor caution

as the company shifts its strategy to focus more on risk management.

Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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