X Financial Faces Sharp Revenue Decline Amid Credit Market Headwinds

The company’s net income plummeted 91.1% compared to the same period last year, settling at RMB 47 million. Despite the steep annual decline, the firm saw a 23.8% sequential improvement in net income from the first quarter of 2026, aided by reduced operating costs and lower credit-related provisions. Loan facilitation for the quarter totaled RMB 11.63 billion, a figure that highlights the ongoing pressure on the platform's core business model.

Credit performance remains a focal point for management. While delinquency rates for loans 31–60 days past due improved to 1.73% from 2.61% in the previous quarter, these figures remain elevated compared to historical benchmarks. President Kent Li stated that the company is prioritizing disciplined underwriting and collection efforts to maintain balance sheet resilience. In response to the challenging environment, X Financial has continued its share repurchase program, buying back 2.63 million American Depositary Shares (ADS) between January and mid-August, with roughly US$35.5 million remaining in its authorization.