FUTU - Futu down despite Q4 beat as client acquisition slows in US

2023-03-28 14:17:22 ET

Hong Kong-based online brokerage and wealth management platform, Futu Holdings ( NASDAQ: FUTU ), was leading financials losers on Tuesday noon despite reporting a Q4 beat as client acquisition slowed in the U.S.

Futu's Q4 GAAP EPADS of $0.87 beats by $0.10 and revenue of $292.3M (+42.3% Y/Y) beats by $31.26M.

The company added more than 240,000 paying clients in 2022, bringing total paying clients to around 1.5M.

Client acquisition decelerated across all regions due to weak market performance in 1H of the quarter and concerns over the sustainability of market rebound in 2H, the company said in its earnings statement.

In Hong Kong, clients over 35 years old composed more than 50% of the new paying clients in the quarter.

In Singapore, client acquisition was resilient, while in the U.S., the company continued to prioritize client quality over quantity.

For the U.S. market, CFO Arthur Chen said during the company's Q4 earnings call that on one hand, market sentiment remained weak, which affected clients' willingness to enter the market. And on the other hand, the company deliberately slowed down client acquisition to focus on improving client quality.

FUTU refrained from giving any guidance relating to U.S. clients in 2023.

Read the recent analysis on Futu here .

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