[Management View]
Futu Holdings Limited reported significant growth in client acquisition and assets across global markets, with total funded accounts reaching approximately 2,900,000, representing a 41% year-over-year increase and an 8% rise quarter-over-quarter. Management highlighted advancements in crypto trading, AI deployment, and regional product adaptation as key drivers of growth.

[Outlook]
Management expressed confidence in meeting full-year objectives, having achieved over 50% of its annual new funded accounts target in the first half of 2025. Plans for further physical expansion and new product rollouts in the second half were disclosed, including enhanced crypto trading functionalities and new wealth management offerings.

[Financial Performance]
Futu reported total revenue of HKD $5.3 billion, up 70% year over year, led by brokerage and handling charge income of HKD $2.6 billion and interest income of HKD $2.3 billion. Net income grew 113% year over year to HKD $2.6 billion, with net income margin expanding to 48.4%.

[Q&A Highlights]
Question 1: The net asset inflow was very strong in the first half of this year and almost double compared to last year. What's the reasoning behind it? Did you adjust any marketing campaign to attract asset inflow? How do you maintain the momentum in the second half?

Answer: The strong asset inflow was driven by positive market performance in the US and Hong Kong, enriched product offerings, and effective marketing campaigns, particularly in overseas markets like the US. The collaboration with the New York Mets significantly boosted client acquisition. Plans for the second half include more physical stores and new product offerings in wealth management and crypto.

Question 2: Crypto trading has launched in Hong Kong, Singapore, and the US. Can you give us some color on the number of clients and trading volume in the second quarter or the first half and also July? Any new product or market will launch in the second half?

Answer: Crypto trading saw strong momentum, with asset value of cryptos growing over 40% quarter-on-quarter. Plans for the second half include new product pipelines in crypto trading and feasibility studies for acquiring exchange licenses in new markets.

Question 3: What's the mid to long-term strategic view on the crypto business in terms of licensing products and potential for monetization? What's the strategic upside coming from the crypto exchange license in Hong Kong?

Answer: The strategy for the crypto business includes integrating traditional finance with crypto, leveraging advanced technologies, and exploring new monetization potentials such as derivatives and staking. The ATP license in Hong Kong will enhance user experience and expand offerings to institutional clients.

Question 4: Regarding the Japan market, what's the understanding about the market? Any change in the understanding, especially regarding the competitive landscape and major competitive strength of the incumbents? How is Futu dealing with the competition? What's our key value at the moment?

Answer: The Japan market is dominated by SBI and Rakuten, but Futu's unique value proposition for self-directed investors interested in US markets is gaining traction. Branding efforts and optimized trading capabilities have led to increased engagement and trading volume. The adoption rate of AI chatbox in Japan is the highest among all international markets.

Question 5: Can you give more color on the third quarter regarding client acquisitions, net asset inflow, and trading volume? What's the plan and target for the US market?

Answer: The third quarter is expected to see steady client acquisitions and positive mark-to-market impact, with potential for increased trading volume. In the US market, partnerships and product innovations like cryptocurrency trading and AI tools are driving growth.

Question 6: Can you provide more information about the regional mix of client acquisition in the second quarter? What will be the potential impact of more stringent onboarding of Mainland Chinese clients in Hong Kong? Any potential change to your full-year guidance of 800,000?

Answer: Hong Kong and Malaysia accounted for over 50% of new client acquisitions in the second quarter. Management remains confident in achieving the full-year target of 800,000 new funded accounts, with no significant impact from new regulations in Hong Kong.

Question 7: Interest income was much stronger than expected despite a drop in HEIBOR. What's the reason behind this? What will be the trend in the third quarter for net interest income? What drives the strong growth in other income, and do you expect this momentum to continue?

Answer: The strong interest income was driven by increased income from hard-to-borrow securities lending and higher client cash positions, offsetting the impact of lower HEIBOR. The third quarter is expected to maintain this momentum. Other income growth was driven by fund distribution services and FX income, with expectations for continued strong performance.

[Sentiment Analysis]
Analysts and management exhibited a positive tone, with confidence in achieving full-year targets and optimism about future growth prospects, particularly in international markets and new product offerings.

[Quarterly Comparison]
| Key Metrics | Q2 2025 | Q2 2024 | YoY Change | QoQ Change |
|----------------------------|---------------|---------------|--------------|--------------|
| Total Funded Accounts | 2,900,000 | 2,057,000 | +41% | +8% |
| New Funded Accounts | 204,000 | 154,545 | +32% | N/A |
| Total Client Assets | HKD $974B | HKD $580B | +68% | +17% |
| Trading Volume | HKD $3.59T | HKD $1.62T | +121% | +12% |
| Wealth Management Assets | HKD $163.2B | HKD $80B | +104% | +17% |
| Total Revenue | HKD $5.3B | HKD $3.1B | +70% | N/A |
| Net Income | HKD $2.6B | HKD $1.22B | +113% | +20% |

[Risks and Concerns]
Potential risks include market volatility, regulatory changes, and competition in international markets. Management is focused on mitigating these risks through diversified product offerings and strategic partnerships.

[Final Takeaway]
Futu Holdings Limited demonstrated robust growth in Q2 2025, driven by international expansion, AI integration, and strategic partnerships. The company is well-positioned to achieve its full-year targets, with strong client engagement and innovative product offerings. Management's confidence and proactive approach to market challenges underscore Futu's potential for sustained growth and competitive positioning in the global financial services industry.