Futu Holdings FUTU reported fourth-quarter 2025 net income of HK$23.92 ($3.07) per American Depositary Share, rising 79.2% year over year.
Revenues rose 45.3% year over year to US$827.2 million, surpassing the Zacks Consensus Estimate by 1.97%, driven by broad-based strength across brokerage commissions, interest income and other service revenue streams.
FUTU's Q4 2025 in Detail
Brokerage commission and handling charge income rose 34.6% year over year to $355.9 million, supported by higher overall trading volumes, partially offset by a mild decline in the blended commission rate.
Interest income climbed 50.2% year over year to $390.3 million, reflecting increased contributions from the securities borrowing and lending business, bank deposits and margin financing activity.
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Other income advanced 78.7% year over year to US$81.0 million, driven by growth in fund distribution service income and IPO subscription service charge income.
Key Metrics for FUTU
Total funded accounts reached 3,365,414 as of Dec. 31, 2025, rising 39.6% year over year. FUTU added 234,000 net new funded accounts during the fourth quarter, an increase of 9% year over year.
Total brokerage accounts rose 29.8% year over year to 5,948,093, while the total registered user base grew 16% year over year to 29.2 million.
Total client assets reached HK$1.23 trillion as of Dec. 31, 2025, up 65.9% year over year, as robust net asset inflows were offset by depreciation in clients' Hong Kong stock holdings.
Total trading volume reached a record HK$3.98 trillion (US$511.3 billion) in the fourth quarter of 2025, rising 37.8% year over year, with U.S. stock trading volume accounting for HK$3.04 trillion (US$390.6 billion) and Hong Kong stock turnover contributing HK$821.1 billion (US$105.5 billion) to the total.
Margin financing and securities lending balance rose 33.1% year over year to HK$67.7 billion (US$8.7 billion), driven primarily by higher U.S. stock margin trading activity and short-term financing demand from Hong Kong IPO activity during the quarter.
Wealth management client assets grew 62% year over year to HK$179.6 billion (US$23.1 billion). Futu expanded product offerings across markets, including funds focused on high dividends in Hong Kong, domestic equity-focused funds in Singapore and Shariah-compliant gold tracker funds in Malaysia. The number of IPO distribution and investor relations clients stood at 600 as of quarter end, up 24.5% year over year.
FUTU's Operating Details
Total costs declined 6.1% year over year to US$93.6 million. Gross profit rose 56.2% year over year to US$733.6 million. Gross margin expanded to 88.7% from 82.5% in the fourth quarter of 2024, reflecting operating leverage on strong top-line growth alongside lower interest expenses tied to the securities borrowing and lending business.
Total operating expenses increased 8.6% year over year to $200.8 million. Research and development expenses rose 26.8% year over year to $65.1 million, reflecting increased headcount to support crypto and artificial intelligence initiatives. Selling and marketing expenses grew 9.2% year over year to $65.1 million, largely in line with growth in net new funded accounts, while customer acquisition costs remained flat year over year. General and administrative expenses declined 4.6% year over year to $70.6 million, primarily due to lower professional service expenses.
Income from operations increased 87% year over year to $532.8 million. Operating margin expanded to 64.4% from 50% in the fourth quarter of 2024.
Net income rose 80.2% year over year to $432.9 million. Net income margin expanded to 52.3% from 42.2% in the year-ago quarter. Non-GAAP adjusted net income, which excludes share-based compensation expenses, rose 77.0% year over year to $444million.
Balance Sheet of FUTU
As of Dec. 31, 2025, cash and cash equivalents were HK$10.47 billion (US$1.34 billion) compared to HK$10.72 billion as of Sept. 30, 2025. Cash held on behalf of clients declined to HK$113.4 billion from HK$127.6 billion in the prior quarter, reflecting lower client payables tied to a moderation in Hong Kong equity market activity.
Borrowings rose modestly to HK$12.14 billion (US$1.56 billion) as of Dec. 31, 2025, from HK$11.82 billion as of Sept. 30, 2025, reflecting continued financing activity to support platform operations and margin lending growth.
FUTU’s Zacks Ranks & Other Stocks to Consider
FUTU currently carries a Zacks Rank #2 (Buy).
Some other top-ranked stocks in the broader Zacks Finance sector are Nelnet NNI, PhenixFIN PFX and ProAssurance PRA.
Nelnet, PhenixFIN and ProAssurance each sport a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Nelnet’s 2026 EPS is pegged at $9.2 per share, down 23.21% year over year.
The Zacks Consensus Estimate for PhenixFin’s 2026 EPS is pegged at $2.5 per share, down 1.96% year over year.
The Zacks Consensus Estimate for ProAssurance’s 2026 EPS is pegged at $1.7 per share, down 33.95% year over year.
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This article originally published on Zacks Investment Research (zacks.com).