[Financial & Operational Highlights](index=1&type=section&id=First%20Quarter%202025%20Operational%20and%20Financial%20Highlights) The company reported strong growth in Q1 2025, with a 58.2% YoY increase in loan facilitation volume and a 20.4% rise in net revenue, demonstrating significant operational and financial momentum Q1 2025 Key Metrics vs. Q1 2024 (YoY) | Metric | Q1 2025 | Change (YoY) | | :--- | :--- | :--- | | Loan Facilitation Volume | RMB 35.6 billion | ▲ 58.2% | | Net Revenue | RMB 1,775.6 million | ▲ 20.4% | | Income from Operations | RMB 606.6 million | ▲ 91.7% | | Net Income | RMB 539.5 million | ▲ 97.5% | | Average Borrowing Amount | RMB 7,987 | ▼ 24.4% | - The contribution from repeat borrowers was **71.9%**, compared to 78.3% in the same period of 2024[7](index=7&type=chunk) - The 90 day+ delinquency ratio was **1.13%** as of March 31, 2025[7](index=7&type=chunk) [Management Commentary](index=3&type=section&id=Management%20Commentary) The CEO highlighted the company's sustained growth momentum, attributing the strong results to the disciplined execution of strategic priorities, including enhancing the loan facilitation business and leveraging AI-driven tools - The company sustained strong growth momentum, with Q1 loan facilitation volume reaching **RMB 35.6 billion** (a **58.2% YoY increase**) and net income totaling **RMB 539.5 million**[8](index=8&type=chunk) - Strategic priorities include accelerating high-quality growth by focusing on the loan facilitation business, expanding institutional partnerships, and improving credit performance[9](index=9&type=chunk) - The company is advancing the application of AI-driven tools across its core business to expand technological capabilities and drive essential value[9](index=9&type=chunk) [Detailed Financial Results (Q1 2025)](index=3&type=section&id=First%20Quarter%202025%20Financial%20Results) Net revenue grew 20.4% YoY to RMB 1,775.6 million, primarily driven by a 77.9% increase in loan facilitation services revenue, leading to a 91.7% surge in income from operations and a 97.5% increase in net income [Revenue Analysis](index=3&type=section&id=Revenue%20Analysis) Total net revenue increased by 20.4% YoY to RMB 1,775.6 million, fueled by a 77.9% surge in revenue from loan facilitation services, partially offset by a significant decrease in revenue from the release of guarantee liabilities Revenue Breakdown (in millions RMB) | Revenue Source | Q1 2024 | Q1 2025 | Change (YoY) | | :--- | :--- | :--- | :--- | | Loan facilitation services | 831.0 (approx) | 1,478.6 | ▲ 77.9% | | Releasing of guarantee liabilities | 524.5 | 170.6 | ▼ 67.5% | | Other revenue | 119.8 | 126.4 | ▲ 5.5% | | **Total Net Revenue** | **1,475.3** | **1,775.6** | **▲ 20.4%** | [Operating Costs and Expenses](index=3&type=section&id=Operating%20Costs%20and%20Expenses) Total operating costs remained relatively flat, but the composition changed significantly, with sales and marketing expenses rising 87.5% due to increased borrower acquisition efforts, while facilitation and servicing expenses decreased by 49.6% Operating Expenses Breakdown (in millions RMB) | Expense Category | Q1 2024 | Q1 2025 | Change (YoY) | | :--- | :--- | :--- | :--- | | Facilitation and servicing | 667.0 | 336.0 | ▼ 49.6% | | Sales and marketing | 359.8 | 674.5 | ▲ 87.5% | | General and administrative | 46.2 | 52.8 | ▲ 14.2% | | Research and development | 83.3 | 88.1 | ▲ 5.8% | [Profitability and Earnings Per Share](index=4&type=section&id=Profitability%20and%20Earnings%20Per%20Share) The company achieved substantial profitability growth, with net income increasing 97.5% YoY to RMB 539.5 million, leading to basic and diluted net income per ADS more than doubling to RMB 10.12 Profitability Metrics | Metric | Q1 2024 | Q1 2025 | Change (YoY) | | :--- | :--- | :--- | :--- | | Income from Operations (RMB M) | 316.4 | 606.6 | ▲ 91.7% | | Net Income (RMB M) | 273.1 | 539.5 | ▲ 97.5% | | Basic & Diluted Net Income per Share (RMB) | 1.29 | 2.53 | ▲ 96.1% | | Basic & Diluted Net Income per ADS (RMB) | 5.16 | 10.12 | ▲ 96.1% | [Financial Position](index=4&type=section&id=Financial%20Position) As of March 31, 2025, the company's cash and cash equivalents stood at RMB 190.3 million, a decrease from RMB 540.5 million at the end of 2024, while total assets grew to RMB 6.4 billion from RMB 5.4 billion Key Balance Sheet Items (in millions RMB) | Balance Sheet Item | Dec 31, 2024 | Mar 31, 2025 | | :--- | :--- | :--- | | Cash and cash equivalents | 540.5 | 190.3 | | Total Assets | 5,409.9 | 6,394.1 | | Total Liabilities | 2,282.3 | 2,727.8 | | Total Shareholders' Equity | 3,127.6 | 3,666.3 | [Business Outlook & Guidance](index=5&type=section&id=Business%20Outlook) The company provided a positive outlook, forecasting full-year 2025 loan facilitation volume between RMB 137 billion and RMB 142 billion, and Q2 2025 loan facilitation volume of RMB 37-39 billion - Full year 2025 loan facilitation volume is expected to be in the range of **RMB 137 billion to RMB 142 billion**[19](index=19&type=chunk) - For the second quarter of 2025, the company expects loan facilitation volume to be between **RMB 37 billion and RMB 39 billion**[19](index=19&type=chunk) - Non-GAAP income from operation for Q2 2025 is projected to be in the range of **RMB 0.66 billion to RMB 0.73 billion**[19](index=19&type=chunk) [Recent Developments](index=5&type=section&id=Recent%20Development) The company announced a new dividend policy and an extension of its share repurchase plan, signaling a commitment to returning value to shareholders [Dividend Policy](index=5&type=section&id=Dividend%20Policy) On May 20, 2025, the Board of Directors approved the declaration and payment of a cash dividend of US$0.20 per ordinary share, equating to US$0.80 per American depositary share (ADS), for the fiscal year 2025 - The Board approved a cash dividend of **US$0.20 per ordinary share**, or **US$0.80 per ADS**, for the fiscal year 2025[20](index=20&type=chunk) [Share Repurchase Plan Update](index=5&type=section&id=Share%20Repurchase%20Plan%20Update) The Board extended the existing share repurchase plan for another 12 months, from June 13, 2025, to June 12, 2026, with a remaining authorized amount for repurchase of US$13.2 million - The share repurchase plan has been extended for another **12-month period**, ending on June 12, 2026[21](index=21&type=chunk) - As of June 4, 2025, the remaining balance under the share repurchase plan was **US$13.2 million**[21](index=21&type=chunk) [Appendix: Financial Statements](index=9&type=section&id=Appendix%3A%20Financial%20Statements) This section contains the unaudited condensed consolidated balance sheets as of March 31, 2025, the unaudited condensed consolidated statements of comprehensive income for the first quarter of 2025, and the reconciliation of GAAP to non-GAAP results [Unaudited Condensed Consolidated Balance Sheets](index=9&type=section&id=UNAUDITED%20CONDENSED%20CONSOLIDATED%20BALANCE%20SHEETS) Provides a detailed snapshot of the company's assets, liabilities, and equity as of March 31, 2025, compared to December 31, 2024 [Unaudited Condensed Consolidated Statements of Comprehensive Income](index=10&type=section&id=UNAUDITED%20CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20COMPREHENSIVE%20INCOME) Details the company's revenues, expenses, and profits for the three months ended March 31, 2025, compared to the same period in 2024 [Unaudited Reconciliations of GAAP and Non-GAAP Results](index=11&type=section&id=UNAUDITED%20RECONCILIATIONS%20OF%20GAAP%20AND%20NON-GAAP%20RESULTS) Presents the reconciliation of GAAP income from operations to non-GAAP income from operations, which were identical at RMB 606.6 million for Q1 2025 due to no share-based compensation expenses GAAP vs Non-GAAP Income from Operation (in thousands RMB) | Metric | Q1 2024 | Q1 2025 | | :--- | :--- | :--- | | Income from operation (GAAP) | 316,446 | 606,647 | | Add: share-based compensation | 181 | - | | Non-GAAP income from operation | 316,627 | 606,647 |

Core Viewpoint - Jiayin Group Inc. reported strong financial results for the first quarter of 2025, with significant growth in loan facilitation volume and net revenue, reflecting the company's effective strategies in a dynamic macroeconomic environment [1][6]. Financial Performance - Total loan facilitation volume increased by 58.2% year-over-year to RMB35.6 billion (approximately US$4.9 billion) [1][9]. - Net revenue grew by 20.4% to RMB1,775.6 million (approximately US$244.7 million) compared to the same period in 2024 [1][8]. - Net income reached RMB539.5 million (approximately US$74.3 million), marking a 97.5% increase from RMB273.1 million in the first quarter of 2024 [1][15]. Operational Highlights - The average borrowing amount per transaction decreased by 24.4% to RMB7,987 (approximately US$1,101) [9]. - The contribution of repeat borrowers to total loan facilitation volume was 71.9%, down from 78.3% in the same period of 2024 [9]. - The 90-day+ delinquency ratio stood at 1.13% as of March 31, 2025 [9]. Revenue Breakdown - Revenue from loan facilitation services was RMB1,478.6 million (approximately US$203.8 million), an increase of 77.9% year-over-year [10]. - Revenue from releasing guarantee liabilities decreased to RMB170.6 million (approximately US$23.5 million) from RMB524.5 million in the same period of 2024 [11]. - Other revenue increased slightly to RMB126.4 million (approximately US$17.4 million) compared to RMB119.8 million in the same period of 2024 [11]. Expense Analysis - Facilitation and servicing expenses decreased by 49.6% to RMB336.0 million (approximately US$46.3 million) [12]. - Sales and marketing expenses rose by 87.5% to RMB674.5 million (approximately US$92.9 million) due to increased borrower acquisition costs [13]. - General and administrative expenses increased by 14.2% to RMB52.8 million (approximately US$7.3 million) [13]. Business Outlook - The company expects its loan facilitation volume for the full year of 2025 to be between RMB137 billion and RMB142 billion, with a second-quarter forecast of RMB37 billion to RMB39 billion [18]. - Non-GAAP income from operations for the second quarter of 2025 is anticipated to be between RMB0.66 billion and RMB0.73 billion [18]. Recent Developments - The Board of Directors approved a cash dividend of US$0.20 per ordinary share for the fiscal year 2025 [19]. - A share repurchase plan was extended for another 12 months, allowing the company to repurchase its shares with an aggregate value not exceeding the remaining balance under the plan [20].

Core Viewpoint - JFIN's stock price increased by 4.04% on May 28, 2023, reaching $13.275 per share, with a total market capitalization of $708 million [1] Financial Performance - As of December 31, 2024, JFIN reported total revenue of 5.801 billion RMB, representing a year-on-year growth of 6.11% [1] - The net profit attributable to the parent company was 1.056 billion RMB, showing a year-on-year decrease of 18.58% [1] Upcoming Events - JFIN is scheduled to disclose its Q1 2025 financial report on June 5, 2023, with the actual date subject to company announcement [2] Company Overview - JFIN is a leading technology service group in China, founded by Mr. Yan Dinggui on June 18, 2011, and headquartered in Shanghai [2] - The company went public on NASDAQ on May 10, 2019, under the stock code JFIN [2] - JFIN focuses on connecting consumers with financial institutions through big data, cloud computing, and artificial intelligence [2] Technological Innovations - JFIN has developed several technology platforms, including: - "Tianyin" for intelligent fund management - "Mingjian" for intelligent risk control - "Dayu" for data asset management - "Chang'e" for intelligent voice calling services [3] - These innovations have led to digital process optimization, automated supervision, and scientific decision-making, enhancing the company's digital capabilities [3] Global Expansion - JFIN's business has expanded to regions including Southeast Asia, Africa, and Latin America, with plans for further international growth [2]

Core Viewpoint - Jiayin Group Inc. will release its unaudited financial results for the first quarter of 2025 on June 4, 2025, before the U.S. market opens, followed by a conference call to discuss these results [1][2]. Group 1 - Jiayin Group Inc. is a leading fintech platform in China, established in 2011, focused on connecting underserved individual borrowers with financial institutions [4]. - The company operates a secure platform with a comprehensive risk management system and a proprietary risk assessment model utilizing advanced big data analytics [4]. - The conference call to discuss the financial results will take place at 8:00 AM U.S. Eastern Time on June 4, 2025, with a live and archived webcast available on the company's investor relations website [2][3].

Core Viewpoint - JiaYin Technology (JFIN.US) has launched its self-developed "Fuxi" model management platform, which leverages strong model management capabilities and intelligent algorithm technology to enhance data application potential and optimize model training, thereby promoting digital transformation in enterprises [1][2]. Group 1: Platform Features - "Fuxi" is named after the cultural ancestor of the Huaxia nation, symbolizing wisdom and innovation, and aims to achieve breakthroughs in model management capabilities in the era of large models [2]. - The platform provides a full-stack solution that allows modelers and developers to quickly and easily build and train machine learning models, significantly lowering development barriers and improving efficiency [2]. - "Fuxi" seamlessly integrates with enterprise data warehouses and big data platforms, enabling centralized management of offline model information, performance evaluation, and efficient governance of model data [2]. Group 2: Performance Improvements - The deployment efficiency of models has increased by 300%, with significant improvements in model data preprocessing efficiency, model stability, and task execution speed [2]. - The platform excels in model asset management, service management, and monitoring, achieving abstraction and unified management of the modeling process [2]. - "Fuxi" supports independent model operation clusters, ensuring stability and scalability of the model runtime environment to meet varying business load demands [6]. Group 3: Advantages of the Platform - The platform features a simple and user-friendly model deployment method that integrates deeply with the development environment, greatly simplifying the model release process [3]. - It enhances the reusability of model parameter configurations through configurable deployment parameters and easy orchestration, improving flexibility and efficiency in model development [4]. - A unified model stability and performance evaluation system is established, allowing for timely identification and resolution of potential issues before production, ensuring high quality and reliability of models [5]. Group 4: Future Development - "Fuxi" will continue to evolve towards model system construction and application expansion, transitioning from intelligent system functions to AI upgrades, and providing more convenient collaborative modeling capabilities [9]. - The launch of the "Fuxi" model management platform represents JiaYin Technology's commitment to technological innovation, aiming to create a new model of digital transformation through "technology research and development - scenario implementation - ecosystem co-construction" [9].

Core Viewpoint - JFIN's stock price increased by 2.96% to $12.54 per share, with a total market capitalization of $669 million as of May 19, 2023, despite a decline in net profit [1] Financial Performance - As of December 31, 2024, JFIN reported total revenue of 5.801 billion RMB, representing a year-on-year growth of 6.11% [1] - The company's net profit attributable to shareholders was 1.056 billion RMB, showing a year-on-year decrease of 18.58% [1] Upcoming Events - JFIN is scheduled to disclose its Q1 2025 financial report on June 5, 2023, with the actual date subject to company announcement [2] Company Overview - JFIN, founded by Mr. Yan Dinggui on June 18, 2011, is a leading technology service group in China, headquartered in Shanghai [2] - The company went public on NASDAQ on May 10, 2019, under the stock code JFIN [2] - JFIN focuses on connecting consumers with financial institutions through big data, cloud computing, and artificial intelligence [2] Technological Innovations - JFIN has developed several technology-driven platforms, including: - "Tianyin" for intelligent fund management - "Mingjian" for intelligent risk control - "Dayu" for data asset management - "Chang'e" for intelligent voice calling services [3] - These innovations have led to digital process optimization, automated supervision, and scientific decision-making, enhancing the company's digital capabilities [3]

Core Viewpoint - JFIN's stock price increased by 4.89% on May 12, reaching $13.395 per share, with a total market capitalization of $715 million. The company reported a total revenue of 5.801 billion RMB for the year ending December 31, 2024, reflecting a year-on-year growth of 6.11%, while the net profit attributable to shareholders decreased by 18.58% to 1.056 billion RMB [1][2]. Group 1 - JFIN is set to disclose its Q1 2025 financial report on June 5, with the actual date subject to company announcements [2]. - Founded in June 2011 by Mr. Yan Dinggui, JFIN is a leading technology service group in China, focusing on connecting consumers with financial institutions through big data, cloud computing, and artificial intelligence [2]. - JFIN has expanded its business globally, covering regions such as Southeast Asia, Africa, and Latin America, with plans for further expansion [2]. Group 2 - The company has implemented a comprehensive technology strategy, resulting in various innovative platforms such as the "Tianyin" intelligent fund management platform, "Mingjian" intelligent risk control engine, "Dayu" data asset management platform, and "Chang'e" intelligent voice call platform [3]. - These technological innovations have led to digitalization of processes, automation of supervision, and scientific decision-making, thereby strengthening the foundation of the digital economy and rapidly enhancing digital capabilities [3].

Core Viewpoint - JFIN (嘉银科技) has shown a modest increase in stock price and reported mixed financial results, indicating both growth in revenue and a decline in net profit, while continuing to focus on technological innovation and expansion into global markets [1][2]. Financial Performance - As of December 31, 2024, JFIN reported total revenue of 5.801 billion RMB, representing a year-on-year growth of 6.11% [1]. - The company's net profit attributable to shareholders was 1.056 billion RMB, reflecting a year-on-year decrease of 18.58% [1]. Company Overview - JFIN is a leading technology service group in China, founded by Mr. Yan Dinggui on June 18, 2011, and headquartered in Shanghai [1]. - The company was successfully listed on NASDAQ on May 10, 2019, under the stock code JFIN [1]. Technological Innovations - JFIN has developed several innovative platforms, including: - "Tianyin" intelligent fund management platform for efficient asset matching [2]. - "Mingjian" intelligent risk control engine for optimizing risk management [2]. - "Dayu" data asset management platform for enhancing data governance [2]. - "Chang'e" intelligent voice call platform for compliant post-loan services [2]. - These innovations have led to digitalization of processes, automation of supervision, and scientific decision-making, strengthening the foundation of the digital economy [2]. Global Expansion - JFIN's business has expanded to regions including Southeast Asia, Africa, and Latin America, with plans for further promotion in more countries and regions [1].

Core Viewpoint - Jiayin Group Inc. has filed its annual report for the fiscal year ended December 31, 2024, with the SEC, highlighting its position as a leading fintech platform in China [1]. Group 1: Company Overview - Jiayin Group Inc. is a prominent fintech platform in China, established in 2011, focused on connecting underserved individual borrowers with financial institutions [3]. - The company operates a secure platform featuring a comprehensive risk management system and a proprietary risk assessment model that utilizes advanced big data analytics and algorithms [3]. Group 2: Financial Reporting - The annual report includes audited consolidated financial statements and is available for shareholders and ADS holders upon request [2].

Financial Performance - The consolidated VIE had accumulated deficits of RMB965 million, RMB636 million, and RMB614 million (US$84 million) as of December 31, 2022, 2023, and 2024, respectively [47]. - Cash dividends received from PRC subsidiaries were nil, RMB157.7 million, and RMB303.7 million (US$41.6 million) for the years 2022, 2023, and 2024, respectively [50]. - As of the date of the report, dividends of RMB461.4 million (US$63.2 million) have been made to the Parent by its subsidiaries [52]. - Jiayin Technology paid a cash dividend of RMB400 million to its shareholders in March 2018 before entering into the Contractual Arrangements [53]. - The company reported a net income of RMB 1,056,468 for the year ended December 31, 2024, a decrease from RMB 1,297,576 in 2023, indicating a decline of about 18.6% [66][66]. - The equity in earnings of subsidiaries and VIEs for the year ended December 31, 2024, was RMB 1,095,954, a decrease from RMB 1,720,422 in 2023, reflecting a decline of approximately 36.2% [66][66]. - The company reported net cash provided by operating activities of RMB 1,425,488 for the year ended December 31, 2024, compared to RMB 389,588 in 2023, indicating a significant increase [67][67]. - The total loan facilitation volume facilitated through the platform was RMB55.5 billion in 2022, RMB88.1 billion in 2023, and is projected to reach RMB100.8 billion (US$13.8 billion) in 2024 [114]. Regulatory Environment - The PRC companies can only pay dividends out of retained earnings, which are determined according to PRC accounting standards [56]. - The company does not anticipate needing approvals from the CAC or other PRC government authorities for future offerings of securities to foreign investors [68]. - The CSRC has implemented new regulations requiring domestic enterprises to complete filing procedures for future offerings within three business days after closing [69]. - There is uncertainty regarding the approval process from the CSRC and CAC, which may significantly impact the ability to offer securities and could adversely affect financial conditions [71]. - The likelihood of being subject to cybersecurity review by the CAC is considered low, as the company and its consolidated VIE are not recognized as critical information infrastructure operators [72]. - Regulatory changes could impose additional compliance requirements, potentially hindering the ability to offer securities and affecting financial results [76]. - The company operates through a VIE structure, which may face scrutiny under PRC laws, impacting the enforceability of contractual arrangements and financial performance [77]. - The company is subject to PRC regulations that limit interest rates; loans exceeding 36% per annum are invalid, and those between 24% and 36% are valid but not enforceable in court [126]. - The company must comply with stringent data protection regulations, which could incur additional costs and impact operations if not adhered to [174][175]. Operational Risks - The company faces risks related to compliance with PRC regulations, which could result in severe penalties or affect the enforceability of its contractual arrangements [90]. - The company must maintain and increase the number of borrowers and loan volume to ensure business sustainability [90]. - The company is subject to credit cycles and risks associated with the deterioration of borrowers' credit profiles [90]. - The company may face challenges in securing funding from institutional partners on acceptable terms, impacting its financial condition [90]. - Negative publicity regarding the online consumer finance industry could adversely affect the company's business and results [90]. - The company relies on proprietary credit assessment models, and any flaws in these models could materially impact its reputation and market share [91]. - The company has obligations to verify borrower information and detect fraud; failure to meet these obligations could lead to liabilities and reputational harm [91]. - The company faces competition from various online consumer finance platforms and traditional financial institutions, which may have more resources and better adaptability to market changes [152]. - The company may struggle to protect its intellectual property rights, which are critical to its competitive position [199]. Financial Position - As of December 31, 2024, total assets amounted to RMB 5,409,893, a significant increase from RMB 5,644,766 as of December 31, 2023 [63][65]. - Total liabilities as of December 31, 2024, were RMB 2,282,279, up from RMB 3,264,305 as of December 31, 2023, showing a reduction in liabilities [63][65]. - Cash and cash equivalents decreased to RMB 540,523 as of December 31, 2024, from RMB 370,193 as of December 31, 2023, indicating a decline of approximately 45.9% [63][65]. - The company’s total operating costs and expenses for the year ended December 31, 2024, were RMB 4,553,017, compared to RMB 4,134,403 in 2023, representing an increase of about 10.1% [66][66]. - The total net assets as of December 31, 2024, were RMB 3,127,614, a slight decrease from RMB 2,380,461 as of December 31, 2023 [63][65]. Strategic Initiatives - The company is exploring opportunities in international markets, including increased investments in Indonesia since establishing an office there in 2019 [111]. - The company has adjusted its cooperation model with institutional funding partners to comply with Circular 141, which imposes restrictions on third-party fees and outsourcing core businesses [101][102]. - The company has entered into collaboration agreements with two licensed credit reporting institutions to ensure compliance with credit reporting regulations [106]. - The company has incurred significant expenses related to brand promotion and borrower acquisition efforts, which may not yield immediate revenue increases [158]. - The company purchased commercial property in Shanghai, approximately 43,500 square meters, for a total cash consideration of approximately RMB1.35 billion (US$184.9 million) to serve as its new headquarters [192]. Technology and Cybersecurity - The company continuously updates its fraud detection technology, but significant increases in fraudulent activities could lead to regulatory intervention and litigation [148]. - The company's risk management system may not be adequate, potentially damaging its reputation and business operations [149]. - The company’s operations depend on the performance of internet infrastructure and telecommunications networks in China, which are under state control [195]. - The company is subject to stringent reporting obligations under the Cyber Security Law of the PRC, which may adversely impact its business and results of operations [179]. - The reliance on complex software systems poses risks of undetected errors that could harm user experience and data protection [198]. Market Conditions - Broader macroeconomic factors, including interest rates and unemployment, can deter borrowers and affect loan facilitation volumes [134]. - Economic conditions in China are sensitive to both domestic policies and global economic factors, which may affect the company's operations [135]. - The company cannot guarantee that demand for consumer loans will remain stable, and any reduction in demand or increase in default rates could negatively impact growth and revenue [136]. - Rising costs of telecommunications and Internet services could adversely affect the company's results of operations [197].