Futu Reports Client Growth Amid Q1 Profit Decline

Futu reports client growth & profit in Q1 2024, with a 330% surge in new paying clients despite a decline in profits. Hong Kong-based online brokerage Futu Holdings Limited (Nasdaq: FUTU) announced strong financial results for the first quarter of 2024, driven by significant growth in new paying clients across key markets. Despite higher revenue, the company’s net profit dropped over 13% to $132.3 million due to increased marketing costs for customer acquisition.

Futu Reports Client Growth Amid Q1 Profit Decline

During the first quarter, Futu added 177,000 new paying clients, representing a 330.8% increase compared to the same period last year. This marks the third-highest quarterly growth in paying clients in the company’s history. As of March 31, 2024, the total number of paying clients reached 1.89 million, showing a 23.5% year-over-year increase. Futu’s Chairman and CEO, Leaf Hua Li, credited the robust growth in paying clients to “strong market performance and solid execution in new markets. Given the year-to-date momentum, we would like to raise our full-year new paying client guidance to 400 thousand for now.”

The company experienced double-digit sequential growth in new paying clients in both Hong Kong and Singapore. Its recent launch in Malaysia surpassed expectations, with Futu attracting over 100,000 registered clients within six weeks of starting its brokerage business there. Total revenues for Q1 2024 increased by 3.7% year-over-year to HK$2.59 billion ($331.3 million). However, net income declined by 13.1% to HK$1.04 billion ($132.3 million), primarily due to higher marketing expenses associated with strong client acquisition. Despite rapid expansion, Futu maintained a quarterly paying client retention rate exceeding 98%.

Total client assets increased by 11.2% year-over-year, reaching HK$517.9 billion. Trading volume rose by 40% sequentially to HK$1.3 trillion, fueled by strong interest in the Hong Kong and US markets. Futu’s wealth management business also experienced significant growth, with client assets rising 72.8% year-over-year to HK$64.0 billion.

Expanding Global Presence and Service

Beyond Hong Kong, Futu provides trading services via its subsidiary Moomoo, which operates in various markets such as the USA, Australia, and Japan. In 2023, Moomoo Japan entered the online brokerage sector, granting local investors access to over 7,000 stocks listed on Wall Street. Additionally, last year, Futu introduced 24/5 stock trading, which is accessible to clients in Singapore and Australia. The company underscored that its customers have the opportunity to trade over 100 US stocks and exchange-traded funds (ETFs) continuously for five days.

For more broker reviews, visit: Broker Reviews