On November 24, new consumer service platform Lexin (NASDAQ: LX) released its unaudited performance report for the third quarter of 2020. In the third quarter, Lexin facilitated a loan amount of 48.3 billion yuan, a year-on-year increase of 30.6; revenue was 3.2 billion yuan, gross profit was 980 million yuan, and non-GAAP profit before interest and tax was 500 million yuan.
Different from the previous loan assistance model, Lexin has shifted from a capital guarantee risk loan assistance model to a technology loan assistance model that does not bear risks.
Financial report data shows that in the third quarter, Lexin platform services and technology revenue reached 1.13 billion yuan, accounting for 36% of revenue. Among them, risk-free To B technology revenue was 614 million, a year-on-year increase of 159. Among the new transaction volume, the proportion of risk-free technology loan assistance models has expanded to 40%, and this proportion continues to increase.
Lexin’s credit payment product Lehua Card and membership-based consumption platform Leka are making efforts. The latest data shows that the number of paid membership users such as Leka exceeds 2.7 million, and the number of Lehua Card activations exceeds 11.38 million. At the same time, the total number of Lexin users increased significantly by 6.96% year-on-year to 106 million, and the number of active transaction users reached 7.4 million, a year-on-year increase of 21.3%. .
Technology service revenue increased by 159% year-on-year
Since announcing the transformation, Lexin’s financial business has shifted to a To B technology service model. Data shows that its To B technology service revenue has reached 6.14 billion, a year-on-year increase of 159.
Lexin CEO Xiao Wenjie said: "Since the beginning of this year, Lexin's efforts in the To B technology service model have achieved initial results. Since October, the transaction volume generated under our risk-free, pure technology service model has accounted for The proportion of increased transaction volume has exceeded 50. Under this model, financial institutions take risks, we can obtain better returns, which is more in line with regulatory directions. In the long run, the company's business model will become lighter and the room for growth will become greater. ”
At present, Lexin’s self-developed products and models can already provide partners with services in customer acquisition, risk control, operation and system construction.
In terms of customer acquisition, Lexin has developed the "Lejian" customized customer acquisition service system based on the RTA model, which can help financial institutions formulate user portraits, screen effective users, engage in peer marketing, etc. Currently, It has helped the user registration conversion rate of cooperative financial institutions to increase by 10-30% compared with before; the credit conversion rate has increased by 20-50%.
In terms of risk control, Lexin’s “Letu” risk profiling product can deeply integrate and process data within Lexin’s system and outside the system, helping financial partners increase their credit approval rate by 20% and reduce risks by 50%. Above; as the core risk control capability, the "Negentropy" risk operation platform serves banks, consumer To B risk operation service carriers, and provides financial institutions with anti-fraud deployment, decision-making flow configuration, federated learning, risk pricing, etc. for finance, small loans, etc. Including more than 100 licensed financial institutions.
In terms of Internet operations, Lexin can help financial institutions provide product construction, user operations, data services and other basic services; in terms of technical system construction, Lexin cooperates with financial institutions to customize credit business systems and intelligent risk control system, asset management system, etc., providing underlying data and basic management support for the system.
Financial data shows that in the third quarter, Lexin invested 118 million in R&D. Lexin said that risk-free To B technology services have become its focus, and it will continue to increase technology investment in the future.
In addition, financial data shows that Lexin facilitated a loan amount of 48.3 billion in the third quarter, a year-on-year increase of 30.6. The average nominal annual interest rate of loans facilitated by the platform was 15; the loan balance under management at the end of the quarter was 67.4 billion, a year-on-year increase of 31. .
It is worth mentioning that Lexin’s nominal annual interest rate of 15 is lower than the latest judicial protection limit of 15.4 for private lending rates.
In terms of asset quality, Lexin’s overdue rate over 90 days was 2.6, and FDP7’s overdue rate also dropped from 2.32 in the previous quarter to 1.82.
The three major products *** work together to develop new consumption
In addition to technology services, Lexin has also shown development potential in the new consumption field and launched a new consumption platform strategy. In the third quarter, Lexin’s total orders reached 84.4 million, a year-on-year increase of 49.9%.
Xiao Wenjie said that Lexin will continue to explore new consumption areas and launch various innovative products and services around new consumption, and is expected to complete the annual transaction volume of 170-180 billion yuan set before the epidemic. Target.
At present, Lexin has created a new consumer waiter with the installment consumption brand Fenqile, the digital full-scenario installment consumption product Lehua Card, and the membership-based consumer service brand Leka as its core, connecting online and offline scene.
Data shows that during this year’s Double 11, the three major platforms, Fenqile, Lehuaka and Leka, facilitated online and offline orders throughout the day, an increase of 90% year-on-year. Since October, Leka has successively launched multiple rounds of catering promotions such as National Day catering benefits and Double 11 "Leka Treats". Among them, the average daily transaction volume of the "Leka Treat" activity launched during Double 11 increased by 81% compared with October.
Specifically, Fenqile launched a more open version during the reporting period, allowing users to jump from Fenqile Mall to Taobao, Pinduoduo and other platforms to complete shopping, with thousands of new consumer brands. Introduced JD.com, Xiaomi Youpin, Kaola Online Shopping, NetEase Select, etc. Data shows that on Double 11 this year, just 46 seconds after the big promotion started, the order amount placed on Fenqile Mall exceeded 100 million.
Leka and other membership products have served more than 2.7 million users, owned more than 4,000 brand rights, and generated membership service fee income of more than 27.6 million yuan, a year-on-year increase of 14%. It has covered brand rights such as catering and fresh food, reading and learning, tourism and travel, e-commerce areas, life services, audio and video games, customized rights and joint memberships.
The number of activations of the credit payment product Lehua Card in the third quarter reached 11.38 million, and a total of 69.76 million transactions were completed, an increase of 70.4% year-on-year. Since the beginning of this year, Lehua Card has driven offline through online, serving a total of 6.12 million offline merchants, creating 210 million orders, and completing a transaction volume of 49.6 billion yuan.
Lexin was also called Fenqile when it was first established. It was established in August 2013 and is an online installment shopping mall. Now Lexin has created a new consumer service ecosystem that integrates installment consumption, membership consumption, and financial technology.
In terms of share repurchases, so far, Lexin CEO Xiao Wenjie, President Wu Yi and other senior executives have invested approximately US$12.9 million to purchase approximately 1.85 million Lexin ADS (American Depository Trust) shares in the open market. shares).