UP Fintech’s growth highlights rising competition for Asian cross-border investors

UP Fintech Holding Limited (UP Fintech) reported double-digit revenue and client asset growth in the first quarter of 2026, underscoring continued demand for cross-border investing platforms despite regulatory pressure in mainland China.

UP Fintech announced its unaudited financial results for the first quarter ended 31 March  2026. Wu Tianhua, chairman and CEO of UP Fintech stated: “In the first quarter, we continued to expand our user base and client assets, while further optimising our comprehensive product offerings. Supported by these solid fundamentals, both our topline and operating performance have achieved notable year-over-year (YoY) growth. Our total revenue for the first quarter reached $154.9 million, representing a 26.3% increase YoY. Net loss and non-GAAP net loss attributable to UP Fintech for the quarter were $26.9 million and $23.8 million, versus net income of $30.4 million and $36.0 million in the same quarter last year. Recently on 22 May, the Beijing Bureau of the China Securities Regulatory Commission (CSRC) issued administrative penalties and ordered the confiscation of illegal gains against certain subsidiaries of the company, with a total amount of approximately RMB 411 million (equivalent to roughly $59.7 million). The penalties stemmed from certain subsidiaries’ unlicensed cross-border securities business and illegal activities relating to the fund and futures business in mainland China. The company sincerely accepts the penalty and has recognised it as a subsequent significant event for the first quarter. Considering the company’s overall profitability and cash flow position, this one-off expense will not have a material adverse impact on our business operations or long-term development.

“In the first quarter, we added 28,900 new funded clients, with great majority of which came from Singapore and Hong Kong markets. Our total funded accounts reached 1.28 million at quarter end, representing an 11.3% year-over-year increase. We continued to see solid net asset inflows, which amounted to $2.9 billion in the first quarter. It marks the first time in our history that quarterly net asset inflow above $2 billion from consolidated retail accounts, further demonstrating solid progress delivered by our client quality focused strategy. The overall market trended downward in the first quarter, driven by the pullbacks across financials, technology and consumer discretionary sectors. This caused $4.9 billion mark to market losses in client assets, led our total client assets down 3.2% quarter-on-quarter, though it still achieved a solid 28.4% YoY growth to reach $58.9 billion at quarter end. Nasdaq has since staged a rebound in the second quarter, and all mark to market losses on client assets recorded in the first quarter have been fully recovered on a quarter-to-date basis.

“We continued optimising products and elevating user experience. This quarter, we upgraded Tiger AI to a Multi-Agent structure, splitting functions like search, analysis, forecasting and risk control into standalone agents for more accurate outputs. In addition, we launched the Futures-focused Agent in the first quarter, which greatly improves accuracy and practicality in future-related inquiries and effectively lifts user satisfaction with Tiger AI’s futures service capabilities. Also, beyond its original dual-model setup, Tiger AI has now integrated with the Claude model, evolving into a triple-model intelligent assistant. Additionally, we further expanded our derivatives trading offerings by officially launching Hong Kong index options trading, alongside the TWAP (time-weighted average price) order function for options.

“Our corporate business continued to perform well in the first quarter of 2026. We underwrote 10 Hong Kong initial public offerings (IPOs), including industry-leading AI players “MiniMax” and “Zhipu AI”. We also completed two major US SPAC IPOs, namely Fortress Value Acquisition Corp. V and KPET Ultra Paceline Corp. Additionally, investor demands for Hong Kong IPO subscriptions remained strong, the total subscription amount on the Tiger platform has exceeded HKD 1 trillion ($127.6 billion) year-to-date in 2026. In our ESOP business, we added 42 new clients in the first quarter, bringing our aggregate ESOP client count to 790 as of March 31, 2026.

“To demonstrate our confidence in the company's long-term growth prospects and our commitment to delivering shareholder value, our board of directors has approved a share repurchase programme of up to $50 million, to be implemented over a 12-month period from 1 June 2026.”

Financial highlights for Q1 2026

Total revenues were $154.9 million, an increase of 26.3% YoY and a decrease of 11.8% quarter-over-quarter. Total net revenues were $136.7 million, an increase of 27.1% YoY and a decrease of 12.7% quarter-over-quarter.

Net loss attributable to ordinary shareholders of UP Fintech was $26.9 million compared to a net income attributable to ordinary shareholders of UP Fintech of $30.4 million in the same quarter of last year.

Non-GAAP net loss attributable to ordinary shareholders of UP Fintech was $23.8 million, compared to a non-GAAP net income attributable to ordinary shareholders of UP Fintech of $36.0 million in the same quarter of last year. A reconciliation of non-GAAP financial metrics to the most comparable GAAP metrics is set forth below.

Operating highlights for first quarter 2026

Total account balance increased 28.4% YoY to $58.9 billion. Total margin financing and securities lending balance increased 19.5% YoY to $6.2 billion. Total number of customers with deposit increased 11.3% YoY to 1.28 million.

First quarter 2026 financial results

Total revenues were $154.9 million, an increase of 26.3% from $122.6 million in the same quarter of last year. Commissions were $67.2 million, an increase of 15.3% from $58.3 million in the same quarter of last year, due to an increase in trading volume.

Financing service fees were $2.4 million, a decrease of 4.6% from $2.6 million in the same quarter of last year, primarily due to a decrease of the account balance of our fully disclosed account customers. Interest income was $64.5 million, an increase of 19.8% from $53.8 million in the same quarter of last year, primarily due to the increase in margin financing and securities lending activities of our consolidated account customers. Other revenues were $20.7 million, an increase of 161.4% from $7.9 million in the same quarter of last year, primarily due to the increase of our wealth management service revenue.

Interest expense was $18.1 million, an increase of 20.6% from $15.0 million in the same quarter of last year, primarily due to the increase in funding for margin financing activities. Total operating costs and expenses were $89.2 million, an increase of 32.9% from $67.1 million in the same quarter of last year. Execution and clearing expenses were $5.0 million, a decrease of 5.5% from $5.3 million in the same quarter of last year due to more self-clearing of US and Hong Kong equities. Employee compensation and benefits expenses were $46.8 million, an increase of 38.5% from $33.8 million in the same quarter of last year, primarily due to higher performance-based bonus accruals and the increase of global headcount to support our global expansion.

Occupancy, depreciation and amortisation expenses were $2.7 million, an increase of 24.9% from $2.1 million in the same quarter of last year, due to the increase in office space and relevant leasehold improvements. Communication and market data expenses were $13.6 million, an increase of 38.9% from $9.8 million in the same quarter of last year due to increased IT-related service fees. Marketing and branding expenses were $14.0 million, an increase of 28.9% from $10.9 million in the same quarter of last year, primarily due to higher marketing spending this quarter. General and administrative expenses were $7.0 million, an increase of 36.8% from $5.1 million in the same quarter of last year due to increased travel expenses and other professional services.

Net loss attributable to ordinary shareholders of UP Fintech was $26.9 million, as compared to a net income attributable to ordinary shareholders of UP Fintech of $30.4 million in the same quarter of last year. Net loss per ADS (one ADS represents 15 Class A ordinary shares), diluted, was $0.151, as compared to a net income per ADS, diluted, of $0.166 in the same quarter of last year.

Non-GAAP net loss attributable to ordinary shareholders of UP Fintech, which excludes share-based compensation, was $23.8 million, as compared to $36.0 million non-GAAP net income attributable to ordinary shareholders of UP Fintech in the same quarter of last year. Non-GAAP net loss per ADS, diluted was $0.134 as compared to a non-GAAP net income per ADS, diluted of $0.198 in the same quarter of last year.

For the first quarter of 2026, the company’s weighted average number of ADSs used in calculating non-GAAP net loss per ADS, diluted was 177,975,928. As of 31 March 2026, the company had a total of 2,680,509,912 Class A and B ordinary shares outstanding, or the equivalent of 178,700,661 ADSs.

As of 31 March 2026, the company's cash and cash equivalents and term deposits were $598.1 million, compared to $793.1 million as of 31 December 2025.

Recent development

As previously disclosed, on 22 May 2026, certain subsidiaries of the company received notices from the China Securities Regulatory Commission Beijing Bureau (CSRC Beijing Bureau) indicating that the CSRC Beijing Bureau had initiated an investigation into their suspected illegal operations of securities, fund and futures business, and found that these subsidiaries had conducted unlicensed cross-border securities business and illegal activities relating to the fund and futures business in mainland China. Based on its findings, the CSRC Beijing Bureau has imposed administrative penalties in the aggregate amount of approximately RMB 308.1 million ($45.4 million) and confiscated illegal income in the aggregate amount of approximately RMB 103.1 million ($15.2 million). The unaudited financial statements for the three months ended 31 March 2026 included in this earnings release have reflected the impact of this subsequent event. These amounts were included in “Others, net” of the unaudited condensed consolidated statements of comprehensive income for the three months ended 31 March 2026.

Share repurchase programme

On 1 June 2026, the company's board of directors approved a share repurchase programme (the Repurchase Programme), under which the company may repurchase its Class A ordinary shares, including in the form of ADSs, with an aggregate value of up to $50 million for a period of 12 months from 1 June 2026 to 1 June 2027. The company expects to fund the repurchases out of its existing cash balance.

Under the Repurchase Programme, the company may repurchase its Class A ordinary shares, including in the form of ADSs, from time to time through various means, including open market transactions, privately negotiated transactions, block trades, and/or any combination thereof, in compliance with applicable laws and regulations. The number of Class A ordinary shares repurchased, including in the form of ADSs, and the timing of repurchases will depend on a number of factors, including, but not limited to, price, trading volume and general market conditions, along with the company's general business conditions and other factors. The company’s board of directors will review the Repurchase Programme periodically and may authorise adjustment of its terms and size, or suspend or discontinue the Repurchase Programme at any time, subject to applicable laws, rules and regulations and the company’s internal policies.

Re-disseminated by Wealth and Society