Summary of Futu Holdings Ltd 3Q24 Earnings Call Company Overview - **Company**: Futu Holdings Ltd (FUTU.O, FUTU US) - **Industry**: Financial Services, specifically online brokerage - **Market Capitalization**: HK$100,573 million - **Stock Rating**: Overweight - **Price Target**: US$115.00, representing a 25% upside from the current price of US$92.30 Key Financial Highlights - **Client Assets**: Increased by 48% year-over-year to HK$693 billion, exceeding consensus estimates by approximately 7% [2][10] - **Revenue**: Reported at HK$3,436 million, a 29.6% increase year-over-year and a 9.8% increase quarter-over-quarter [10] - **Net Brokerage Commissions**: Increased to HK$1,318 million, up 53.2% year-over-year [10] - **Net Interest Income**: HK$1,285 million, a 5.7% increase year-over-year [10] - **Profit**: Non-GAAP net profit of HK$1,319 million, reflecting a 20.9% year-over-year increase [10] Client Growth and Market Performance - **Client Acquisition**: Total paying clients reached 2,196,647, a 33.1% increase year-over-year [10] - **Client Inflows**: Overseas inflows surpassed HK$10 billion for three consecutive quarters, contributing to approximately 25-30% of total inflows [7] - **Trading Volume**: Total trading volume increased by 75% year-over-year to HK$1,904,102 million [10] Special Dividend Announcement - **Dividend**: A special dividend of US$280 million was announced, representing over 40% of the estimated profit for 2024 and 7.8% of the equity base [4] - **Management Confidence**: The dividend reflects management's confidence in the company's balance sheet and growth potential, indicating that it will not hinder expansion plans [4] Operational Insights - **Trading Velocity**: Increased to 12x total assets from 11.8x in the previous quarter, primarily driven by US stocks [2] - **Client Acquisition Cost**: Decreased by 7% quarter-over-quarter to HK$2,037, expected to remain below the guided HK$2,500 for the full year [3] - **Market Share**: Notable increase in trading volume market share, particularly in US stocks, which rose to 1.03% [10] Regional Performance - **Client Growth by Region**: Hong Kong and Singapore contributed over one-third of new clients, with Singapore seeing an 18% increase in total client assets [5] - **Crypto Trading**: Daily trading volume for cryptocurrencies has ramped up to US$10-20 million since launch, with expectations for continued growth [7] Risks and Assumptions - **Upside Risks**: Better-than-expected market conditions in Hong Kong and the US, and solid traction in Japanese user acquisition [13] - **Downside Risks**: Major corrections in US/HK markets and increased regulation of the onshore client base [13] Conclusion Futu Holdings Ltd demonstrated strong financial performance in 3Q24, with significant growth in client assets and revenue, alongside a positive outlook for overseas expansion and a shareholder-friendly special dividend. The company remains well-positioned in the online brokerage space, with ongoing efforts to enhance its market presence and client acquisition strategies.

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