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TIGR UP Fintech Holding

Participants
Clark S. Soucy Investor Relations
Wu Tianhua Chairman and Chief Executive Officer
John Zeng Chief Financial Officer
Han Pu CICC
Julia Zhang Citi
Hanyang Wang 86Research
Call transcript
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Operator

Ladies and gentlemen, thank you for standing by, and welcome to the UP Fintech Holding Limited Third Quarter 2021 Earnings Conference Call. At this time, all participants are in a listen-only mode. There will be a presentation followed by a question-and-answer session. I must advise you that this conference is being recorded today, Tuesday, November 30, 2021. I would now like to hand the conference over to your first speaker today, Mr. S. Clark

Please you. ahead. go Thank Soucy.

Clark S. Soucy

was Hello, Thank services. IR joining third website thank and release for at ir.itiger.com as and for you, quarter available the GlobeNewswire our earnings Limited operator. us Holding call you Fintech today well everyone, today. on earlier distributed as XXXX is UP

Wu will available of financial our US then and Mr. call follows questions operations the Chief results. Fintech Mr. business remarks. Mr. Officer; Q&A answer Zhao, our to highlights. John Mr. Zeng give an UP Lei, the Executive Controller. discuss be overview discuss Financial that Huang during Wu corporate Mr. both your Officer; and Mr. They On are from will session will Tiger CEO their Financial our of Zeng, Kenny today and Tianhua, Securities; Chief Chairman

Act Now, any we statements Securities within meaning Harbor. from of let the forward-looking in to those of differ actual are materially results statement. about Reform XXXX. Safe cover Private statements me make contain factors could the of contained The U.S. cause forward-looking A number the to Litigation

introduce to Mr. in ahead followed Wu except be statement, Chairman Mr. please please XXXX information to Chinese, English to now furnished pleasure on forward-looking as Chief could about factors statements, results any your our Form an update obligation on We actual remarks. translation. will my materially our Executive Form from and April law. XX, our required more filed those by which applicable Annual remarks the today, no XX-F with forward-looking Mr. cause November differ X-K go in is and XXXX. undertake For to that refer under make will Report Wu. XX, Wu, Officer, It

Wu Tianhua

asset The conditions. net position An the quarter. client market client this year-over-year. surpassing net Language] of broker-dealer of XX% healthy increased XX,XXX annual double subdued assets from Mainland year the for earnings XXX,XXX was by Tiger’s but quarter-over-quarter a Language] an call. XXX,XXX, three million, continued Total added Language] already business going new Total funded Language] numbered caused from Hello, second China. quarter values accounts XX% progressing came funded of to our milestone third third of accounts which [Foreign Non-GAAP that the last from global important quarter impact will conference of have XXXX Brokers’ the first to quarter X.XX outside is both loss existing $XX.X is decline for well. in everyone in obtained to expansion This increase and We Kong period the an almost that this big same accounts up quarter, The Tiger of billion, year. new firm totaled from a income in triple over inflows the of new Total we’ve client $X.X and customer at forward. license Hong on was assets month. is [Foreign for stood of end Our drop a last license the accounts third Brokers see the XXX,XXX, quarter in by [Foreign guidance. year-over-year. welcome the clients. Tiger were and the due Total second year-over-year, year. $XX.X improvement XXX,XXX at revenue [Foreign million, million, Total the third quarters XX% primarily drop total XX%

financial a we true Kong. Hong example, a global Kong of acquiring both investors in and is start may users institutional. high-quality substantial with center number Hong retail For

integrated be among Kong Hong for Hong IPOs per from Singapore. the will [Foreign Language] further user. of margin may to Tiger’s Kong, to Association into the able Hong and loans, the HK license, trade clearing commissions, user and also We improve the generate revenue With to was be others, addition income Kong we improve experience Securities will company trading admitted system. securities, In to as execution more

reached Singapore, Singapore member Tiger and States of Central trading the XX of broker Limited as to the online Brokers Depository. In The in a Singapore. clearing became member We licenses Securities Hong United has Trading also in be categories Australia. and and Singapore total, admitted notable obtained Tiger XX first in Singapore a Brokers Trading, qualifications Derivatives Zealand, landmark a Kong, Exchange Exchange New

pertaining take updates to expedite international give global a dual set Language] other Singapore [Foreign now in Singapore, initiatives. expansion. the Australia, up our this New offices Brokers has to and headquarters decided Zealand banking investment also presently business on to to to Language] four asset We key Kong. Hong United opportunity and States, would like licenses Tiger [Foreign I brokerage, in and holds management

as capability strategy. million for our on our As quarters total a of year. markets. our higher over guidance than funded year little annual our as period for XXX,XXX year in listed ESOP will the companies. scale previously time corporate of third which already In first in Language] able institutional We added to internationalization business came our to business. Language] doubled new more we funded number a China. unlisted XX% stated, We brokerage investment and that companies of next a accounts. were added in companies year, which [Foreign for mark to rapidly ESOP invest we were this compete of acquire exceed three And regards clients, such the And international quarter, confident in the internationalizing. executing accounts been Kong has expect than strategy same and short in With our clients banking XX in rapid users exceeded of and well year. Tiger five validates a and The was global A-share U.S. cumulative business, our [Foreign only we scaling so of outside accounts last the ESOP remain of the XX we firm corporate last X remains in in the quarter, and Hong services, third Brokers has continue new is period augments our many expansion. Being our XXXX. the XXX.X% from to Mainland in internationalization state

Our connect to third build service with investors Tiger in account added use enterprise quarter. the corporates brands, directly new and which in the also their Community, XX accounts

self-clearing of local investment serve underwriter grateful side, four Hong as in XXXX. which a their by Marsco, also we cleared banking dual company. the Xpeng in we its having Kong. for [Foreign cash On primary of were TradeUP, participated broker equity acquired three U.S. All U.S. IPOs, to trades known clients as in an and a was were We are one listing SPACs new Language] American which formerly

using the to Securities crypto I as money to to of from received enables from more end invite U.S. the Singapore, transmitter the Tiger As we TradeUP look XX% self-clear may equities. licenses of John, U.S. go of with to [Foreign future. now which residents. to in us Language] New State approval I so like provide obtaining clients CFO, provide am just forward We to for our crypto licenses Jersey, quarter, a third the communicated, As our trading were U.S. and local access. New financials. previously trading we residents would over in Jersey are cash of the announce cryptocurrency our applying pleased crypto

John Zeng

Clark. Hello, and everyone. Thanks, Tianhua

trading Tiger’s interest numbers quarter to quarter-over-quarter fee quarter-over-quarter XXX% more quarter. in a volume. in X.X through in the and So Commission self-clearing Take rate year-over-year X% second year-over-year in performance the more balance was The was in as was in The volume still we an margin grow line walk lending third quarter U.S. third operation in are efficient quarter. to service of U.S. derivatives quarter-over-quarter. $XX.X given balance. higher lower the increase Hong and and is with volume income, line more bps security financial increase third margin with margin primarily due income, lower million, the increased the for bps me you million, commission a for IPO X All growth increase third the the trading third and also second partially income. from saw weaker $XX.X XX% quarter year-over-year offset was quarter. slightly Other in and from versus listing underwriting such X% let but underwriting The drop with the XX% Interest-related We the financing the ADR quarter. trading in which the our quarter $X.X million, quarter, in managed Chinese versus second interest-related quarter-over-quarter combines year-over-year dollar. to third revenue, due revenue, especially revenue options market, XX% year-over-year, mostly the increase by increased and commission to Kong. down in in

quarter, was As $XX.X a million quarter-over-quarter. flat XX% increased and revenue third year-over-year result, the total in

Now, cost. on the

million, XX% $X.X The were with to quarter, and and Singapore. expense in million $X.X balance. margin expense So more growth quarter-over-quarter. XX% is year-over-year interest to increased Execution XXX% increased line user in this and custodian due fees year-over-year primarily in clearing increase increase

growth. and custodian became in the Tiger expense assets with SGX grows custody external Before in member clearing a used client and October, we trading custodian to line an user

custodian as increased gradually with down support our $XX.X Employee data we $X to year-over-year occupancy expense XX% XXX% adding as Marketing year-over-year to million million. year-over-year, year-over-year XX% We we $X.X Along quarter, to quarter self-custody increase, third million, XXX% will to headcount rapid R&D was up expect usage $X.XX to the a keep result expense to increased million quarter, self-clearing in XX% of quarter-over-quarter. global also million. $XX.X as Singapore. SG&A in XX% increased such down increased growth. compensation user expense and more this go headcount in this year-over-year Communication assets but expansion.

the market be marketing the window. customer being scaled to acquisition the right we we when with see Given we said, increase our That will back costs. quarter, choppy third spending in prudent marketing backdrop

$X.X million. So net market quarter private $XX.X change other was quarter on and items, for non-GAAP for this for non-GAAP And third income adjusted CB million. value was income fair our

Q&A. have Operator, please for concluded open I our the line presentation. Now,

Operator

ask [Operator first Han Please comes instructions] question. line your from Your of Pu CICC. from question the

Han Pu

Pu I taking for our CICC is Thanks two This of Language] question. have [Foreign questions. and Han

the give of during the regulation-related we acquisition the Secondly, the Thanks. impact Firstly, seen environment more us our you could user on regulatory and us previous update some could to on use? management operation give on already impact business? color Have potential some current QX?

Wu Tianhua

[Foreign Language]

John Zeng

Okay.

in regarding the and just news deals me quickly media. Tianhua the regulatory mentioned let those translate latest just So what

our security basically, overseas business KYC, regions. same regulators follow is and AML different regulated by the in than So procedures servicing domestic investors. broker no We model different relevant

more is on model but R&D, innovation we so more can our parallel So customers. which not brings some business on experience bring user

monitoring the on to Information policies attached self-examination of from support already properly resource new when agreement regulator. making to this the leading effect compliance. outflow to and the into a the out rules process, inception the requirements. in guidance compliance. procedures business current actually top definitely and make and is of effect. brokerage, And to news, Language] definitely business And new coming compliance compliance benefits we experts law serious are attention always information law hired operations accordance net of the We to keep information into advance now make will conducted develop and our from sure personal this If – an with sure saw there [Foreign regarding normal. from our can to lines are have the great involving when the we we pay in adjust and importance to back can we in policies very we of the our of protection November ensure with have several besides, high the it’s and sure and business development following and policy and already so with we, units industry into going before we situation have all since user this did Personal industry, X. the Protection standards players So we as implemented lawyers data self-exam security some scale we laws international rounds first And the And be such will will one external we formulated are will Tiger, be in regulators, went put Law, we and law, in before there as and will ensure we applicable preparation And maximized. in we users’ law. of policies and the forward, close personal experts the lot under new industry course, on reflected new law small We

saw average non-Chinese Thank than And keep second which an above. international high-quality average around seeing since we brand $X,XXX that actually, users. in still third shows our Singapore is attracting For new the service more even deposits October, first-timer our the of users, asset It’s actually we initial for deposit users from $X,XXX inflow. you. acquired actually, or users quarter, and

Han Pu

[Foreign Thanks. Language]

Operator

The Citi. from next question Kwong question. from comes ask Please Alan your

Julia Zhang

for management. Julia Hi, two the This raise Research. from questions Citi Language] is giving questions. to [Foreign I here. the Thank me opportunity have you

First, trading new acquisition you already terms has give the it’s number in target? you mutual focus funded the terms of XXX,XXX. fourth encouraging year the regions guidance guidance of operational surpassed could you. Thank customer to and in of the color of volume? full customer customer about the us that growth more plan, the Also, nine the months see share assets and in first also Could quarter including key

Wu Tianhua

[Foreign Language]

John Zeng

Okay.

shows well. our funded of XX,XXX strategy which So came we outside progressing which of from is XX% over in third really China, international the accounts, quarter, added

course, in of be now, right will Hong focus our and forward, Kong. Singapore Going

we help a better service clients. We self-clearing SGX. Singapore, local in obtained depository qualifications in just Hong us just got a license from So Singapore will Kong. These license

definitely Hong focus. will key So area Kong is another we

marketing Now course, – the to developing U.S. competitive mentioned U.S. marketing States. officially Tianhua now we feel are our in those in also on trading We yet. just still the crypto the as this infrastructure self-clearing. this trading of more us New we of evaluating we our a infrastructure devoting Jersey. launch Kong. believe are In And U.S., we launched will we in to into got tap the give tool could another the us our Focus the more of course, really peers big the when money be markets. ramp outside haven’t Hong other market. up And – license for market areas, transmitter is in over advantage earlier, some We resource

We new before will analysis market. do a entering comprehensive

bring of R&D quarter capability of now will on We competitive our value internationalization in can Based will we we its give market can user we outlook, we an experience us so fourth acquisition. we monitor growth decide are outlook. our [Foreign monitor our the landscape, much UE user and when will experience marketing, CSE, evaluate regarding to acquisition how of are what confident condition we the optimistic spend TAM, our When Singapore, kind entering Language] strategy, payback. will markets new what review edge generate. So course still on monitor and right the we user we

market be waiting still marketing. for as So of relatively the scaled is similar to might see smaller opportunity given QX product up is right quarter. to backdrop, holidays are we volume but far, And versus more right and Total the R&D. for similar our now, volume we equity on QX. And cash options, a ramp quarter, back third given our than trading volumes, so focus QX, fourth in UE higher

can Kong resources you. more up users. provide we to beef spend R&D in and infrastructure will better we Thank experience make sure our for So in to Hong our trading Singapore

Operator

Wang Hanyang question. XXResearch. the from of Please Your comes line next from your question ask

Hanyang Wang

Thanks, taking my Language] for questions. management [Foreign

have I questions. two So

the business Joy on quarter. The Kong Securities Kong. The expansion company Hong this acquiring is obtained to in license broker Ocean Hong first regarding one the

So we Hong competition know is in the Kong. intense quite

be business. for Second will your user IPO-related Kong shall about in the new what users question And strategy acquisition come expect Hong So Kong? forward? the how from incremental we going Hong is the

so uncertainties. quarter, started of So this while IPO still Kong Hong to we in that observed tech the resume the Chinese ADR faced listing the

your Thank view what’s the underwriting So of on business? you. development the

Wu Tianhua

[Foreign Language] me let first. Yes, translate

Okay.

Hong us. of everybody license as important first So is very Kong all, know, to

on one other the missing which base be Hong Hong ARPU Kong from able out tap license the from user we we our Tiger’s increase we’re can we to user side, the the – before. base. hand, will local Kong the with have So And residents, into on

plan for So our basically Hong steps. three Kong will be

the First of institutional business, ESOP institutional matter or IPO on the or underwriting. no serving Hong all, for Kong investors it’s

Kong So institutional and aggressive space. definitely the Hong more be with the license, in we’ll active more

IB from our securities to self-clearing gradually be Kong. will step second Hong for The Hong Kong move own clearing to

and we of clear to lot expense IB Hong very know, a is you expensive. traditionally, the Kong As use clearing trades

low product Hong IB to But own this Hong Kong really once Kong. switching in our be will gradually our before. Kong for changed in from So Hong clearing we was UE clearing

of Kong example, will we companies be have into know a Kong subscription, for chance them lot we and in to a apps. like Tiger tap lot Hong But own feel Kong step we of Hong users. Kong. especially, launching a retail will advantage. lot Hong more us third We give what And very give peers in The our our IPO naturally, marketing product, has competitive a for credit done, Hong and have of good they

So can Hong translate. so in share market good Okay, [Foreign we Language] grab let feel Kong. pretty confident we quickly me

the given see given a Kong more for the next underwriting to compensate But we back we IPO banking revenue by perspective, an see investment Sino-U.S. So don’t when more the to just the we from underwriting a be drop Hong we do agreement. Kong revenue know see do from how but license, the ADR both sometime want ADR will financial to underwriting quarter. yes, We Chinese year, And the Tiger meantime, in hopefully, we have can reach reiterate sides business. third in U.S. could recent resume, IPO relationship, market. underwriting market. potential I Chinese believe in to the Hong we active now loss drive will

the ARPU. course, ESOP So generated increased is is But user can to us we business so bank. our value-added and business, from important synergy underwriting clients corporate the with and important. brokerage different and provide service to business investment is and traditional more fee, of our retail Underwriting more stickiness underwriting by

headwind resource committed putting but into sure retail more there employ can the to units business understand, synergy our for corporate and make other So more we to we Tiger to underwriting in you. users. may business Thank into our values short-term, and underwriting business, short, provide be to some in our we are

Hanyang Wang

[Foreign Language] Thank you. Very helpful.

Operator

to S. this At now the I would hand Mr. call like Clark back point, to

Soucy for closing remarks. the

Clark S. Soucy

closing call at participation to call would for on management thank I your now joining the everyone We today’s in call. of appreciate I am here our like do Tiger. today. behalf the team

please your have and any for much the our to further questions, you This relations investor call concludes If out thank very you team. time. reach

Operator

for Thank you. participating. conclude Thank you conference and gentlemen, our Ladies that today. does for

You may all now disconnect.