Up Fintech Stock Plunges 17% on Disappointing Quarterly Results
The Chinese online brokerage company reported lower-than-expected revenue and said it sought to expand overseas with a new license from Singapore.
Up Fintech Holding Ltd. (Nasdaq: TIGR) reported lower-than-expected revenue and increased net loss in the first quarter, sending its stock on a 17 percent plunge to $5.82 per share intraday Friday.
The Chinese online brokerage firm said its revenue in the three months through March was $9.6 million, representing a 20 percent increase from $8 million one year ago.
"We are pleased to report encouraging growth in the first quarter of 2019," Tianhua Wu, the chief executive officer of Up Fintech, said in a statement today.
According to its report, improvement resulted from higher financing service fees, interest income, and other revenues. Revenue from financing service fees enjoyed the fastest growth of 58 percent at $1.3 million. The company said its business line of margin trading, when investors use borrowed funds to trade a financial asset, contributed significantly.
Up Fintech reported a quarterly net loss of $2.9 million, or 6 cents per American depository share, compared with $2 million, or 7 cents per ADS, in the first quarter of 2018. It attributed the mounting loss to the increased employee compensations totaling $7.8 million, up 61 percent year-over-year. Communication and market data expenses increased 88 percent to $1.2 million.
The report was the first for Up Fintech as a U.S.-listed company. It became publicly traded in New York in March, raising $104 million in its IPO. The company has received backing from financial and technology giants including Interactive Brokers LLC and Xiaomi Corp.
Based in Beijing, Up Fintech operates its online and mobile platform under the name Tiger Trade App. The company said it is seeking to get operating licenses in multiple areas to expand its customer base early in 2019. It has recently obtained approval for launching operations in Singapore, according to the statement.
"Apart from business growth, we have obtained broker/dealer In-Principle Approval ("AIP") from Monetary Authority of Singapore, which is a great milestone to our growth strategy," Wu said.