Artificial Intelligence
LexinFintech Holdings Ltd. Reports Fourth Quarter and Full Year 2020 Unaudited Financial Results
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SHENZHEN, China, March 18, 2021 (GLOBE NEWSWIRE) — LexinFintech Holdings Ltd. (“Lexin” or the “Company”) (NASDAQ: LX), a leading online consumption and consumer finance platform for new generation consumers in China, today announced its unaudited financial results for the quarter ended December 31, 2020.
Fourth Quarter and Full Year 2020 Operational Highlights:
1 Originations of loans and outstanding principal balance represent the origination and outstanding principal balance of both on- and off-balance sheet loans.
2 Active users refer to, for a specified period, users who made at least one transaction during that period through our platform or through our third-party partners’ platforms using credit line granted by us.
3 GMV refers to the total value of transactions completed for products purchased on the e-commerce channel, net of returns.
4 Nominal APR refers to all-in interest costs and fees to the borrower over the net proceeds received by the borrower as a percentage of the total loan originations of both on- and off-balance sheet loans. 5 90 day+ delinquency ratio refers to outstanding principal balance of on- and off-balance sheet loans that were 90 to 179 calendar days past due as a percentage of the total outstanding principal balance of on- and off-balance sheet loans on our platform as of a specific date. On-balance sheet loans that were over 179 calendar days past due and charged off are not included in the delinquency rate calculation. Off-balance sheet loans that were over 179 calendar days past due are assumed charged off and not included in the delinquency rate calculation. The Company does not distinguish on the basis of the on- or off-balance sheet treatment in monitoring the credit risks of borrowers and the delinquency status of loans.
Fourth Quarter 2020 Financial Highlights:
Full Year 2020 Financial Highlights:
6 Non-GAAP EBIT, adjusted net income, adjusted net income per ordinary share and per ADS are non-GAAP financial measures. For more information on non-GAAP financial measures, please see the section of “Use of Non-GAAP Financial Measures Statement” and the tables captioned “Unaudited Reconciliations of GAAP and Non-GAAP Results” set forth at the end of this press release.
“In the past year, in spite of the challenging conditions presented by the ongoing COVID-19 pandemic, Lexin was able to meet our guidance and complete our loan origination targets. Our registered users, scale, and revenues continued to grow, and our credit risk is continuing to stabilize.” said Mr. Jay Wenjie Xiao, Lexin’s chairman and chief executive officer. “In particular, our ‘To Bank’ technology service capabilities continue to lead the industry. In the fourth quarter, loan originations generated under our pure technology service model represented over 50% of our new loan originations, improving the overall quality of our growth. This year, Lexin will aim to achieve even faster growth with higher quality, and based on the strong performance in the first quarter and the improving asset quality, we are raising our full year loan origination target up to RMB250 billion.”
“Even our core financial technology business continues to grow, we will concurrently develop a second area of growth. At the beginning of this year, Lexin introduced our new Yuehui, Maiya, and Xiaofeihao products, to expand the potential of our business, and to expand the customers that we serve from 120 million to the potential 500 million in the new consumption cohort. We currently estimate that our Maiya product will achieve GMV of RMB50 million for March.” Mr. Xiao added. “The scale of our potential business will extend to cover China’s USD4 trillion new consumption market. As China becomes the world’s largest consumption market, Lexin will utilize the customers, consumption scenarios, and operational capabilities that we have accumulated over the many years, to fully capture the potential of this historical opportunity, and to realize ever stronger growth from the expanding new consumption market.”
“We performed strongly in the last quarter of 2020 and we are currently seeing strong positive growth trends for 2021. As a result, we are raising our full year loan origination guidance for 2021, as we now expect total loan originations for 2021 to be between RMB240 and RMB250 billion,” said Mr. Craig Yan Zeng, Lexin’s chief financial officer, “In addition, the continued efforts made on improving asset quality are expected to enable a strong recovery in our profitability for the current fiscal year.” “Our credit performance and credit quality continues to improve for new loan originations and is within our expectations,” said Mr. Yang Qiao, Lexin’s vice president, “Our vintage charge-off rates7 is at approximately 4.0%, and our 90 day+ delinquency rate was 1.95% as of December, 2020. In addition, our first payment default rate (30 day+)8 for new loan originations have been at below 1% for the past 5 months now, and our one-month delinquencies for all our key past vintages have peak. As a result, we expect our credit performance to continue to improve in the future.”
7 Vintage charge-off rate refers to, with respect to on- and off-balance sheet loans originated during a specified time period, which we refer to as a vintage, the total outstanding principal balance of the loans that are charged off during a specified period, divided by the total initial principal of the loans originated in such vintage. Please refer to vintage curve at the end of “Fourth Quarter 2020 Financial Results” of this press release.
8 Loan balance with first payment day past due 30+ over total loan origination.
Fourth Quarter 2020 Financial Results:
Operating revenue decreased from RMB3,148 million in the fourth quarter of 2019 to RMB3,033 million in the fourth quarter of 2020. This decrease in operating revenue was due to a decrease in online direct sales and services income, partially offset by the increase in credit-oriented services income and platform-based services income for the quarter, driven by continuing increases in the number of active users on our platform, and the change of the presentation of guarantee income along with the adoption of ASC 326. Before the adoption of ASC 326, gain or loss related to financial guarantee not accounted for as derivatives was recorded in one combined financial statement line item within “Gain on guarantee liabilities, net.” After the adoption of ASC 326, the gain released from the guarantee liabilities accounted for under ASC 460 is recorded as “Guarantee income” as a separate financial statement line item within revenue and the relevant credit losses are recorded as “Provision for credit losses of contingent liabilities of guarantee.” Online direct sales decreased by 60.6% from RMB1,085 million in the fourth quarter of 2019 to RMB428 million in the fourth quarter of 2020. This decrease was primarily due to the decrease in the number of e-commerce orders during the fourth quarter of 2020.
Credit-oriented services income increased by 3.2% from RMB1,789 million in the fourth quarter of 2019 to RMB1,846 million in the fourth quarter of 2020. The increase was primarily resulted from the increase of RMB339 million due to change of presentation of guarantee income as aforementioned and the increase of interest and financial services income and other revenues, partially offset by the decrease in loan facilitation and servicing fees-credit oriented.
Loan facilitation and servicing fees-credit oriented decreased by 32.4% from RMB1,530 million in the fourth quarter of 2019 to RMB1,034 million in the fourth quarter of 2020. This decrease was primarily due to the Company’s business strategy shift to increase the loan originations under platform-based model.
Guarantee income for the fourth quarter of 2020 was RMB339 million. The guarantee liabilities accounted for under ASC 460 are released from the underlying risk, i.e., as the underlying loan is repaid by the borrower or when the lender is compensated in the event of a borrower’s default.
Interest and financial services income and other revenues increased by 82.3% from RMB259 million in the fourth quarter of 2019 to RMB473 million in the fourth quarter of 2020, which was consistent with the increase in the origination of on-balance sheet loans in the fourth quarter of 2020. Platform-based services income increased by 232% from RMB216 million in the fourth quarter of 2019 to RMB717 million in the fourth quarter of 2020. This increase was primarily contributed by an increase in the loan facilitation and servicing fees-performance based.
Loan facilitation and servicing fees-performance based increased by 251% from RMB194 million in the fourth quarter of 2019 to RMB679 million in the fourth quarter of 2020. This increase was primarily due to an increase in the origination of off-balance sheet loans under the performance-based model within platform-based services, driven by continuing increases in the number of active users on our platform.
Cost of sales decreased by 60.4% from RMB1,092 million in the fourth quarter of 2019 to RMB432 million in the fourth quarter of 2020, which is consistent with the decrease of online direct sales revenue.
Funding cost increased by 9.7% from RMB128 million in the fourth quarter of 2019 to RMB141 million in the fourth quarter of 2020, which was consistent with the increase of the funding debts to fund the on-balance sheet loans.
Processing and servicing cost increased by 81.8% from RMB210 million in the fourth quarter of 2019 to RMB382 million in the fourth quarter of 2020. This increase was primarily due to an increase in fees to third-party insurance companies and guarantee companies, an increase in risk management expenses, and an increase in salaries and personnel related costs. Provision for credit losses of financing receivables decreased by 31.2% from RMB219 million in the fourth quarter of 2019 to RMB151 million in the fourth quarter of 2020. The credit losses have reflected the most recent performance in relation to the Company’s on-balance sheet loans and the Company has continued to implement prudent credit assessment and risk management policies and procedures.
Provision for credit losses of contract assets and receivables increased by 794% from RMB20.9 million in the fourth quarter of 2019 to RMB187 million in the fourth quarter of 2020. This increase was mainly due to the significant increase in off-balance sheet loans originated as a result of the continuing growth of our business, earlier recognition of credit losses under ASC 326 as well as negative impact of the ongoing COVID-19 pandemic started in 2020.
Provision for credit losses of contingent liabilities of guarantee was RMB220 million in the fourth quarter of 2020. After the adoption of ASC 326 on January 1, 2020, a separate contingent liability in full amount determined using current expected credit losses (“CECL”) lifetime methodology is accounted for in addition to and separately from the guarantee liabilities accounted for under ASC 460, and relevant credit losses are recorded as “Provision for credit losses of contingent liabilities of guarantee.” Before the adoption of ASC 326, gain or loss related to such financial guarantee was recorded in one combined financial statement line item within “Gain on guarantee liabilities, net.”
Gross profit increased by 2.9% from RMB1,478 million in the fourth quarter of 2019 to RMB1,520 million in the fourth quarter of 2020. The increase in the gross profit is primarily due to the significant increase in platform-based services income and interest and financial services income and other revenues, and partially offset by the increase in processing and servicing cost, provision for credit losses of contract assets and receivables and provision for credit losses of contingent liabilities of guarantee.
Sales and marketing expenses decreased by 34.0% from RMB520 million in the fourth quarter of 2019 to RMB343 million in the fourth quarter of 2020. This decrease was primarily due to a decrease in online advertising cost. Research and development expenses decreased by 6.1% from RMB101 million of 2019 to RMB95.1 million in the fourth quarter of 2020. This decrease was primarily due to a decrease in salaries and personnel related costs.
General and administrative expenses increased by 4.8% from RMB120 million in the fourth quarter of 2019 to RMB125 million in the fourth quarter of 2020. This increase was primarily due to an increase in rental expenses.
Change in fair value of financial guarantee derivatives was a loss of RMB326 million in the fourth quarter of 2020, as compared to a loss of RMB258 million in the fourth quarter of 2019. The loss was primarily due to the re-measurement of the expected loss rates of the underlying outstanding off-balance sheet loans at the balance sheet date.
Change in fair value of loans at fair value was a loss of RMB35.9 million in the fourth quarter of 2020. Starting from the second quarter of 2020, for the loans we acquired/purchased from the relevant funding partners during the period, we account for them using fair value option pursuant to ASC 825, Financial Instruments, and record them as “Loans at fair value”. Changes in fair value of these loans are reported net and recorded as “Change in fair value of loans at fair value”.
Income tax expense for the fourth quarter of 2020 was RMB94.2 million, as compared to income tax expense of RMB96.1 million in the fourth quarter of 2019. The decrease of the income tax expense was consistent with the decrease of the taxable income from the same period of 2019. Net income for the fourth quarter of 2020 was RMB510 million, representing a decrease of 1.6% from RMB518 million in the fourth quarter of 2019.
Adjusted net income for the fourth quarter of 2020 was RMB603 million, representing an increase of 3.1% from RMB585 million in the fourth quarter of 2019.
Full Year 2020 Financial Results:
Operating revenue increased from RMB10,604 million in 2019 to RMB11,645 million in 2020. This increase in operating revenue was due to an increase in credit-oriented services income and platform-based services income for the year, driven by continuing increases in the number of active users on our platform, and the change of the presentation of guarantee income along with the adoption of ASC 326, partially offset by the decrease in online direct sales and services income. Before the adoption of ASC 326, gain or loss related to financial guarantee not accounted for as derivatives was recorded in one combined financial statement line item within “Gain on guarantee liabilities, net.” After the adoption of ASC 326, the gain released from the guarantee liabilities accounted for under ASC 460 is recorded as “Guarantee income” as a separate financial statement line item within revenue and the relevant credit losses are recorded as “Provision for credit losses of contingent liabilities of guarantee.”
Online direct sales decreased by 47.5% from RMB3,624 million in 2019 to RMB1,901million in 2020. This decrease was primarily due to the decrease in the number of e-commerce orders during 2020. Credit-oriented services income increased by 26.3% from RMB6.0 billion in 2019 to RMB7.5 billion in 2020. The increase was primarily resulted from the increase of RMB2,320 million due to change of presentation of guarantee income as aforementioned, partially offset by the decrease in loan facilitation and servicing fees-credit oriented.
Loan facilitation and servicing fees-credit oriented decreased by 21.3% from RMB4,812 million in 2019 to RMB3,787 million in 2020. This decrease was primarily due to the Company’s business strategy shift to increase the loan originations under platform-based model.
Guarantee income for 2020 was RMB2,320 million. The guarantee liabilities accounted for under ASC 460 are released from the underlying risk, i.e., as the underlying loan is repaid by the borrower or when the lender is compensated in the event of a borrower’s default.
Interest and financial services income and other revenues increased by 23.7% from RMB1,147 million in 2019 to RMB1,419 million in 2020, which was consistent with the increase in the origination of on-balance sheet loans in 2020.
Platform-based services income increased by 150% from RMB816 million in 2019 to RMB2,037 million in 2020. This increase was primarily contributed by an increase in the loan facilitation and servicing fees-performance based, partially offset by the decrease in loan facilitation and servicing fees-volume based. Loan facilitation and servicing fees-performance based increased by 198% from RMB649 million in 2019 to RMB1,931 million in 2020. This increase was primarily due to an increase in the origination of off-balance sheet loans under the performance-based model within platform-based services, driven by continuing increases in the number of active users on our platform.
Cost of sales decreased by 47.4% from RMB3,624 million in 2019 to RMB1,908 million in 2020, which was consistent with the decrease of online direct sales revenue.
Funding cost increased by 15.9% from RMB509 million in 2019 to RMB590 million in 2020, which was consistent with the increase of the funding debts to fund the on-balance sheet loans.
Processing and servicing cost increased by 120% from RMB642 million in 2019 to RMB1,413 million in 2020. This increase was primarily due to an increase in fees to third-party insurance companies and guarantee companies, an increase in fees to third-party payment platforms, an increase in risk management expenses, an increase in credit assessment cost, and an increase in salaries and personnel related costs.
Provision for credit losses of financing receivables increased by 10.0% from RMB709 million in 2019 to RMB779 million in 2020. The credit losses have reflected the most recent performance in relation to the Company’s on-balance sheet loans and the Company has continued to implement prudent credit assessment and risk management policies and procedures. Provision for credit losses of contract assets and receivables increased by 252% from RMB125 million in 2019 to RMB442 million in 2020. This increase was mainly due to the significant increase in off-balance sheet loans originated as a result of the continuing growth of our business, earlier recognition of credit losses under ASC 326 as well as negative impact of the ongoing COVID-19 pandemic started in 2020.
Provision for credit losses of contingent liabilities of guarantee was RMB2,881 million in 2020. After the adoption of ASC 326 on January 1, 2020, a separate contingent liability in full amount determined using current expected credit losses (“CECL”) lifetime methodology is accounted for in addition to and separately from the guarantee liabilities accounted for under ASC 460, and relevant credit losses are recorded as “Provision for credit losses of contingent liabilities of guarantee.” Before the adoption of ASC 326, gain or loss related to such financial guarantee was recorded in one combined financial statement line item within “Gain on guarantee liabilities, net.”
Gross profit decreased by 27.3% from RMB4,994 million in 2019 to RMB3,633 million in 2020. The decrease in the gross profit is primarily due to the significant increase of processing and servicing cost, provision for credit losses of contract assets and receivables and provision for credit losses of contingent liabilities of guarantee, partially offset by the increase in platform-based services income.
Sales and marketing expenses decreased by 17.2% from RMB1,539 million in 2019 to RMB1,274 million in 2020. This decrease was primarily due to a decrease in online advertising cost.
Research and development expenses increased by 14.0% from RMB416 million in 2019 to RMB474 million in 2020. This increase was primarily due to an increase in salaries and personnel related costs and an increase in depreciation and amortization expenses. General and administrative expenses increased by 9.5% from RMB412 million in 2019 to RMB451 million in 2020. This increase was primarily due to an increase in salaries and personnel related costs.
Change in fair value of financial guarantee derivatives was a loss of RMB707 million in 2020, as compared to a loss of RMB212 million in 2019. The loss was primarily due to the re-measurement of the expected loss rates of the underlying outstanding off-balance sheet loans at the balance sheet date.
Change in fair value of loans at fair value was a loss of RMB47.3 million in 2020. Starting from the second quarter of 2020, for the loans we acquired/purchased from the relevant funding partners during the period, we account for them using fair value option pursuant to ASC 825, Financial Instruments, and record them as “Loans at fair value”. Changes in fair value of these loans are reported net and recorded as “Change in fair value of loans at fair value”.
An investment-related impairment charge of RMB69.2 million was recognized in 2020 on an equity investment due to its unsatisfied financial performance.
Income tax expense for 2020 was RMB90.6 million, as compared to income tax expense of RMB412 million in 2019. The decrease of the income tax expense was consistent with the decrease of the taxable income from 2019. In addition, RMB16.2 million income tax provision relating to 2019 was reversed as one subsidiary of the Group was certified to be qualified for using a preferential tax rate of 10% for 2019 annual tax clearance in the third quarter of 2020. Net income for 2020 was RMB595 million, representing a decrease of 74.1% from RMB2,295 million in 2019.
Adjusted net income for 2020 was RMB903 million, representing a decrease of 62.9% from RMB2,434 million in 2019.
Please click here to view our vintage curve:
http://ml.globenewswire.com/Resource/Download/016e8a88-23ed-46f7-92ce-697c02cd0ae7
Regulatory update In February 2021, the China Banking Regulatory Commission, the People’s Bank of China, the Ministry of Education, the Office of the Central Cyberspace Affairs Commission and the Ministry of Public Security jointly issued the Notice on Further Strengthening the Regulation and Management Work of Internet Consumer Loan for College Students. The notice provides that the micro-credit companies are prohibited to provide internet consumer loans to college students. In addition, it sets forth several requirements on the banking financial institutions participating in internet consumer loans for college students, including without limitation: (i) the banking financial institutions and its cooperative institution shall not conduct online precision marketing aimed at college students, and shall complete necessary filings and reports with relevant authorities before offline promotion in campus; (ii) the banking financial institutions shall strictly check credit qualifications and the identities of college students and their use of loans, conduct comprehensive credit assessment, and receive a written confirmation from the second repayment sources (such as parents, guardians, or other administrator of the college students) that they agree such internet consumer loan provided to such college student and they will guarantee the repayment of such internet consumer loan; and (iii) all credit information of internet consumer loan for college students shall be submitted to the financial credit information database in a timely, complete and accurate manner, and college students who do not agree to submit such credit information shall not be extended the loan.
In 2017, as directed by the relevant regulatory authorities, our micro-credit loan company had already stopped providing services to college students. We will also recommend new customers based on any new instructions provided by our financial institution partners. In addition, we will continue to assess and strengthen our customer identification capabilities, to better comply with the requests of our financial institution partners.
Management changes
On March 18, 2021, Lexin appointed Mr. Ryan Huanian Liu as the Company’s new senior vice president responsible for new business initiatives. Previously, Mr. Liu was Lexin’s chief risk officer in charge of the company’s risk control operations. In addition, Lexin would also like to welcome Mr. Yang Qiao to the Lexin team as a new vice president responsible for risk control. Prior to joining Lexin, Mr. Qiao held senior positions with JD Finance, Discover, and ZRobot.
Outlook Based on Lexin’s preliminary assessment of the current market conditions, the Company now expects total loan originations for fiscal year 2021 to be between RMB240 billion and RMB250 billion, representing an upward adjustment of up to RMB30 billion from the previously stated guidance of RMB220 to RMB230 billion disclosed in the Company’s January 2021 press release. This is Lexin’s current and preliminary view, which is subject to changes and uncertainties.
Conference Call
The Company’s management will host an earnings conference call at 11:00 PM U.S. Eastern time on March 18, 2021 (11:00 AM Beijing/Hong Kong time on March 19, 2021).
Participants who wish to join the conference call should register online at:
http://apac.directeventreg.com/registration/event/3006519 Please note the Conference ID number of 3006519.
Once registration is completed, participants will receive the dial-in information for the conference call, an event passcode, and a unique registrant ID number.
Participants joining the conference call should dial-in at least 10 minutes before the scheduled start time.
Additionally, a live and archived webcast of the conference call will be available on the Company’s investor relations website at http://ir.lexin.com.
A replay of the conference call will be accessible approximately two hours after the conclusion of the live call until March 26, 2021, by dialing the following telephone numbers: About LexinFintech Holdings Ltd.
LexinFintech Holdings Ltd. is a leading online consumption and consumer finance platform for new generation consumers in China. The Company provides a range of services including financial technology services, membership benefits, and a point redemption system through its ecommerce platform Fenqile and membership platform Le Card. The Company works with financial institutions and brands both online and offline to provide a comprehensive consumption ecosystem catering to the needs of young professionals in China. Lexin utilizes advanced technologies such as big data, cloud computing and artificial intelligence throughout the Company’s services and operations, which include risk management, loan facilitation, and the near-instantaneous matching of users’ funding requests with offers from the Company’s many funding partners.
For more information, please visit http://ir.lexin.com
To follow us on Twitter, please go to: https://twitter.com/LexinFintech.
Use of Non-GAAP Financial Measures Statement In evaluating our business, we consider and use adjusted net income, non-GAAP EBIT, adjusted net income per ordinary share and per ADS, four non-GAAP measures, as supplemental measures to review and assess our operating performance. The presentation of the non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with U.S. GAAP. We define adjusted net income as net income excluding share-based compensation expenses, interest expense associated with convertible notes, investment-related impairment and investment loss/(income) and we define non-GAAP EBIT as net income excluding income tax expense, share-based compensation expenses, interest expense, net, investment-related impairment, and investment loss/(income).
We present these non-GAAP financial measures because it is used by our management to evaluate our operating performance and formulate business plans. Adjusted net income enables our management to assess our operating results without considering the impact of share-based compensation expenses, interest expense associated with convertible notes, investment-related impairment and investment loss/(income). Non-GAAP EBIT, on the other hand, enables our management to assess our operating results without considering the impact of income tax expense, share-based compensation expenses, interest expense, net, investment-related impairment and investment loss/(income). We also believe that the use of these non-GAAP financial measures facilitates investors’ assessment of our operating performance. These non-GAAP financial measures are not defined under U.S. GAAP and are not presented in accordance with U.S. GAAP.
These non-GAAP financial measures have limitations as an analytical tool. One of the key limitations of using adjusted net income and non-GAAP EBIT is that they do not reflect all items of income and expense that affect our operations. Share-based compensation expenses, interest expense associated with convertible notes, income tax expense, interest expense, net and investment-related impairment and investment loss/(income) have been and may continue to be incurred in our business and are not reflected in the presentation of adjusted net income and non-GAAP EBIT. Further, these non-GAAP financial measures may differ from the non-GAAP financial information used by other companies, including peer companies, and therefore their comparability may be limited.
We compensate for these limitations by reconciling the non-GAAP financial measure to the most directly comparable U.S. GAAP financial measure, which should be considered when evaluating our performance. We encourage you to review our financial information in its entirety and not rely on a single financial measure.
Exchange Rate Information Statement This announcement contains translations of certain RMB amounts into U.S. dollars (“US$”) at specified rates solely for the convenience of the reader. Unless otherwise stated, all translations from RMB to US$ were made at the rate of RMB6.5250 to US$1.00, the exchange rate set forth in the H.10 statistical release of the Federal Reserve Board on December 31, 2020. The Company makes no representation that the RMB or US$ amounts referred could be converted into US$ or RMB, as the case may be, at any particular rate or at all.
Safe Harbor Statement
This announcement contains forward-looking statements. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. Statements that are not historical facts, including statements about Lexin’s beliefs and expectations, are forward-looking statements. These forward-looking statements can be identified by terminology such as “will,” expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates,” “confident” and similar statements. Among other things, the expectation of its collection efficiency and delinquency, business outlook and quotations from management in this announcement, contain forward-looking statements. Lexin may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission (the “SEC”), in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: Lexin’s goal and strategies; Lexin’s expansion plans; Lexin’s future business development, financial condition and results of operations; Lexin’s expectation regarding demand for, and market acceptance of, its credit and investment management products; Lexin’s expectations regarding keeping and strengthening its relationship with borrowers, institutional funding partners, merchandise suppliers and other parties it collaborates with; general economic and business conditions; and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks is included in Lexin’s filings with the SEC. All information provided in this press release and in the attachments is as of the date of this press release, and Lexin does not undertake any obligation to update any forward-looking statement, except as required under applicable law.
For investor and media inquiries, please contact:
LexinFintech Holdings Ltd. Media inquiries: SOURCE LexinFintech Holdings Ltd.
________________________
In providing credit-oriented services, we originate on-balance sheet loans, or facilitate the loan origination of off-balance loans where we also provide guarantee services. Consequently, we take all credit risks of borrowers in respect of on-balance sheet loans, and off-balance sheet loans through the relevant guarantee arrangements. By nature, revenue earned from off-balance sheet loans where we also provide guarantee services is recorded as “Loan facilitation and servicing fees-credit oriented” and “Guarantee income,” and interest income and other fees from on-balance sheet loans is recorded as “Interest and financial services income and other revenues.”
In providing platform-based services, we do not provide guarantee services and take no credit risks of borrowers in respect of principal and interests due to the lenders for off-balance sheet loans we facilitate. We either charge the service fees for loan facilitation and servicing at predetermined rates based on the performance of the underlying off-balance sheet loans, which we refer to as performance-based model, or charge the service fees at predetermined rates of amount of loan originations upon successful matching of borrowing requests, which we refer to as volume-based model. Revenue from “Loan facilitation and servicing fees-credit oriented,” “Loan facilitation and servicing fees-performance based” and “Loan facilitation and servicing fees-volume based” were previously reported as one combined financial statement line item as “Loan facilitation and servicing fees” before the change of presentation.
For online direct sales and services income, we report the premium membership fees for our membership packages as “Membership services,” and the commission fee earned from third-party sellers for the online marketplace services we rendered and other services revenue as “Other services” within “Online direct sales and services income.” The premium membership fees, commission fee earned from third-party sellers and other services revenue were previously reported as “Services and others” within “Online direct sales and services income” before the change of presentation.
Before the adoption of ASC 326, gain or loss related to guarantee liabilities accounted for under ASC 460 was recorded in one combined financial statement line item within “Gain on guarantee liabilities, net.”
After the adoption of ASC 326, the gain released from the guarantee liabilities accounted for under ASC 460 is recorded as a separate financial statement line item within revenue as “Guarantee income” and the relevant credit losses of guarantee are recorded as “Provision for credit losses of contingent liabilities of guarantee.”
United States:
1 855 452 5696 or 1 646 254 3697
International:
61 2 8199 0299
Replay Access Code:
3006519
IR inquiries:
Tony Hung
Tel: +86 (755) 3637-8888 ext. 6258
E-mail: [email protected]
Limin Chen
Tel: +86 (755) 3637-8888 ext. 6993
E-mail: [email protected]
LexinFintech Holdings Ltd.
Unaudited Condensed Consolidated Balance Sheets
As of
(In thousands)
December 31, 2019
December 31, 2020
RMB
RMB
US$
ASSETS
Current assets
Cash and cash equivalents
2,085,234
1,563,755
239,656
Restricted cash
1,813,855
1,112,152
170,445
Restricted time deposits
1,962,293
1,779,458
272,714
Short-term financing receivables, net of allowance for credit losses of RMB318,262 and
RMB508,013 as of December 31, 2019 and December 31, 2020, respectively
3,752,690
4,918,548
753,800
Loans at fair value
–
381,393
58,451
Accrued interest receivable, net of allowance for credit losses of nil and RMB1,681 as of
December 31, 2019 and December 31, 2020, respectively
54,284
79,793
12,229
Prepaid expenses and other current assets
1,324,924
1,004,845
153,999
Amounts due from related parties
–
941
144
Deposits to insurance companies and guarantee companies
1,251,003
1,066,281
163,415
Short-term guarantee receivables, net of allowance for credit losses of RMB49,833 and
RMBB58,771 as of December 31, 2019 and December 31, 2020, respectively
1,183,278
756,197
115,892
Short-term contract assets and service fees receivable, net of allowance for credit losses of
RMB94,894 and RMB65,607 as of December 31, 2019 and December 31, 2020, respectively
2,971,976
3,707,649
568,222
Inventories, net
106,781
47,170
7,229
Total current assets
16,506,318
16,418,182
2,516,196
Non‑current assets
Restricted cash
86,537
163,999
25,134
Restricted time deposits
4,350
–
–
Long‑term financing receivables, net of allowance for credit losses of RMB55,283 and
RMB21,149 as of December 31, 2019 and December 31, 2020, respectively
658,798
204,761
31,381
Long-term guarantee receivables, net of allowance for credit losses of RMB750 and RMB16,994
as of December 31, 2019 and December 31, 2020, respectively
281,699
218,654
33,510
Long-term contract assets and service fees receivable, net of allowance for credit losses of
RMB2,845 and RMB18,970 as of December 31, 2019 and December 31, 2020, respectively
482,875
481,989
73,868
Property, equipment and software, net
92,553
125,694
19,263
Land use rights, net
–
1,000,467
153,328
Long‑term investments
511,605
521,802
79,970
Deferred tax assets
157,138
747,332
114,534
Other assets
454,421
462,285
70,848
Total non‑current assets
2,729,976
3,926,983
601,836
TOTAL ASSETS
19,236,294
20,345,165
3,118,032
LIABILITIES
Current liabilities
Accounts payable
201,837
42,961
6,584
Amounts due to related parties
40,804
67,514
10,347
Short‑term borrowings
1,977,691
1,827,063
280,010
Short‑term funding debts
3,755,528
4,685,935
718,151
Accrued interest payable
87,003
36,484
5,591
Guarantee liabilities(1)
1,726,368
–
–
Deferred guarantee income(1)
–
694,582
106,449
Contingent guarantee liabilities(1)
–
1,738,787
266,481
Funds payable to individual investors
618,749
–
–
Accrued expenses and other current liabilities
1,394,639
2,926,347
448,482
Total current liabilities
9,802,619
12,019,673
1,842,095
Non‑current liabilities
Long‑term funding debts
450,595
825,814
126,562
Deferred tax liabilities
309,646
21,046
3,225
Convertible notes
2,046,051
1,920,227
294,288
Other long-term liabilities
27,844
27,667
4,240
Total non‑current liabilities
2,834,136
2,794,754
428,315
TOTAL LIABILITIES
12,636,755
14,814,427
2,270,410
SHAREHOLDERS’ EQUITY:
Class A Ordinary Shares
170
176
27
Class B Ordinary Shares
61
58
9
Additional paid‑in capital
2,519,886
2,724,006
417,472
Statutory reserves
352,313
649,234
99,499
Accumulated other comprehensive (loss)/income
(7,288
)
3,308
507
Retained earnings
3,734,397
2,113,956
323,978
Non-controlling interests
–
40,000
6,130
TOTAL SHAREHOLDERS’ EQUITY
6,599,539
5,530,738
847,622
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY
19,236,294
20,345,165
3,118,032
(1)
We have adopted ASU No. 2016-13, Financial Instruments—Credit Losses (Topic 326) effective January 1, 2020 using the modified retrospective method.
Before the adoption of ASC 326, the guarantee liabilities subsequent to initial recognition were measured at the greater of the amount determined based on ASC 460 and the amount determined under ASC 450. An excess liability was recorded when the aggregate contingent liabilities under ASC 450 exceeded the balance of guarantee liabilities determined under ASC 460.
After the adoption of ASC 326, a contingent liability in full amount determined using CECL lifetime methodology of the guarantee (i.e., the contingent aspect recorded as “Contingent guarantee liabilities”) shall be accounted for in addition to and separately from the guarantee liability (i.e., the noncontingent aspect recorded as “Deferred guarantee income”) accounted for under ASC 460.
LexinFintech Holdings Ltd.
Unaudited Condensed Consolidated Statements of Operations
For the Three Months Ended December 31,
For the Year Ended December 31,
(In thousands, except for share and per share data)
2019
2020
2019
2020
RMB
RMB
US$
RMB
RMB
US$
Operating revenue:
Online direct sales
1,084,700
427,760
65,557
3,623,991
1,900,835
291,316
Membership services(1)
26,067
37,009
5,672
112,558
113,107
17,334
Other services(1)
32,451
5,482
839
92,292
68,890
10,558
Online direct sales and services income(1)
1,143,218
470,251
72,068
3,828,841
2,082,832
319,208
Loan facilitation and servicing fees-credit oriented(1)
1,529,525
1,034,265
158,508
4,811,868
3,786,996
580,383
Interest and financial services income and other revenues
259,256
472,668
72,440
1,146,824
1,418,892
217,455
Guarantee income(2)
–
338,580
51,890
–
2,319,693
355,509
Credit-oriented services income(1)
1,788,781
1,845,513
282,838
5,958,692
7,525,581
1,153,347
Loan facilitation and servicing fees-performance based(1)
193,559
679,494
104,137
648,516
1,930,835
295,913
Loan facilitation and servicing fees-volume based(1)
22,503
37,903
5,809
167,458
106,007
16,246
Platform-based services income(1)
216,062
717,397
109,946
815,974
2,036,842
312,159
Total operating revenue
3,148,061
3,033,161
464,852
10,603,507
11,645,255
1,784,714
Operating cost:
Cost of sales
(1,091,666
)
(431,804
)
(66,177
)
(3,624,301
)
(1,907,508
)
(292,338
)
Funding cost
(128,307
)
(140,735
)
(21,569
)
(508,829
)
(589,837
)
(90,396
)
Processing and servicing cost
(210,124
)
(381,964
)
(58,539
)
(642,126
)
(1,413,212
)
(216,584
)
Provision for credit losses of financing receivables
(219,363
)
(150,851
)
(23,119
)
(708,684
)
(779,235
)
(119,423
)
Provision for credit losses of contract assets and receivables
(20,940
)
(187,227
)
(28,694
)
(125,471
)
(441,805
)
(67,710
)
Provision for credit losses of contingent liabilities of guarantee(2)
–
(220,489
)
(33,791
)
–
(2,880,590
)
(441,470
)
Total operating cost
(1,670,400
)
(1,513,070
)
(231,889
)
(5,609,411
)
(8,012,187
)
(1,227,921
)
Gross profit
1,477,661
1,520,091
232,963
4,994,096
3,633,068
556,793
Operating expenses:
Sales and marketing expenses
(520,009
)
(343,272
)
(52,609
)
(1,538,698
)
(1,274,402
)
(195,311
)
Research and development expenses
(101,342
)
(95,124
)
(14,578
)
(415,995
)
(474,265
)
(72,684
)
General and administrative expenses
(119,723
)
(125,464
)
(19,228
)
(412,117
)
(451,284
)
(69,162
)
Total operating expenses
(741,074
)
(563,860
)
(86,415
)
(2,366,810
)
(2,199,951
)
(337,157
)
Change in fair value of financial guarantee derivatives, net
(257,777
)
(325,848
)
(49,938
)
(212,256
)
(707,442
)
(108,420
)
Change in fair value of loans at fair value
–
(35,926
)
(5,506
)
–
(47,282
)
(7,246
)
Gain on guarantee liabilities, net(2)
115,546
–
–
196,063
–
–
Interest expense, net
(29,476
)
(18,074
)
(2,770
)
(39,215
)
(77,542
)
(11,884
)
Investment-related impairment
–
(33,786
)
(5,178
)
–
(69,156
)
(10,599
)
Investment (loss)/income
(1,222
)
(1,436
)
(220
)
52,211
7,885
1,208
Others, net
50,345
62,734
9,614
82,422
146,029
22,380
Income before income tax expense
614,003
603,895
92,550
2,706,511
685,609
105,075
Income tax expense
(96,081
)
(94,219
)
(14,440
)
(411,959
)
(90,629
)
(13,890
)
Net income
517,922
509,676
78,110
2,294,552
594,980
91,185
Net income per ordinary share
Basic
1.45
1.39
0.21
6.45
1.63
0.25
Diluted
1.30
1.27
0.19
6.14
1.56
0.24
Net income per ADS
Basic
2.89
2.79
0.43
12.90
3.26
0.50
Diluted
2.60
2.54
0.39
12.29
3.13
0.48
Weighted average ordinary shares outstanding
Basic
358,312,515
365,939,185
365,939,185
355,625,970
364,733,164
364,733,164
Diluted
408,188,044
411,086,216
411,086,216
375,831,131
411,229,810
411,229,810
(1)
Starting from the second quarter of 2020, we report revenue streams in three categories—online direct sales and services income, credit-oriented services income and platform-based services income, to provide more relevant information. We also revised the comparative period presentation to conform to current period classification.
(2)
We have adopted ASU No. 2016-13, Financial Instruments—Credit Losses (Topic 326) effective January 1, 2020 using the modified retrospective method.
LexinFintech Holdings Ltd.
Unaudited Condensed Consolidated Statements of Comprehensive Income
For the Three Months Ended December 31,
For the Year Ended December 31,
(In thousands)
2019
2020
2019
2020
RMB
RMB
US$
RMB
RMB
US$
Net income
517,922
509,676
78,110
2,294,552
594,980
91,185
Other comprehensive (loss)/ income
Foreign currency translation adjustment, net of nil tax
(6,339
)
13,884
2,128
7,020
10,596
1,624
Total comprehensive income
511,583
523,560
80,238
2,301,572
605,576
92,809
LexinFintech Holdings Ltd.
Unaudited Reconciliations of GAAP and Non-GAAP Results
For the Three Months Ended December 31,
For the Year Ended December 31,
(In thousands, except for share and per share data)
2019
2020
2019
2020
RMB
RMB
US$
RMB
RMB
US$
Reconciliation of Adjusted Net Income to Net Income
Net income
517,922
509,676
78,110
2,294,552
594,980
91,185
Add: Share-based compensation expenses
53,495
46,633
7,148
177,262
198,825
30,472
Interest expense associated with convertible notes
12,393
11,535
1,768
14,261
47,781
7,323
Investment-related impairment
–
33,786
5,178
–
69,156
10,599
Investment loss/ (income)
1,222
1,436
220
(52,211
)
(7,885
)
(1,208
)
Adjusted net income
585,032
603,066
92,424
2,433,864
902,857
138,371
Adjusted net income per ordinary share
Basic
1.63
1.65
0.25
6.84
2.48
0.38
Diluted
1.43
1.47
0.22
6.48
2.20
0.34
Adjusted net income per ADS
Basic
3.27
3.30
0.51
13.69
4.95
0.76
Diluted
2.87
2.93
0.45
12.95
4.39
0.67
Weighted average number of ordinary shares outstanding
Basic
358,312,515
365,939,185
365,939,185
355,625,970
364,733,164
364,733,164
Diluted
408,188,044
411,086,216
411,086,216
375,831,131
411,229,810
411,229,810
LexinFintech Holdings Ltd.
Unaudited Reconciliations of GAAP and Non-GAAP Results
For the Three Months Ended December 31,
For the Year Ended December 31,
(In thousands)
2019
2020
2019
2020
RMB
RMB
US$
RMB
RMB
US$
Reconciliations of Non-GAAP EBIT to Net Income
Net income
517,922
509,676
78,110
2,294,552
594,980
91,185
Add: Income tax expense
96,081
94,219
14,440
411,959
90,629
13,890
Share-based compensation expenses
53,495
46,633
7,148
177,262
198,825
30,472
Interest expense, net
29,476
18,074
2,770
39,215
77,542
11,884
Investment-related impairment
–
33,786
5,178
–
69,156
10,599
Investment loss/(income)
1,222
1,436
220
(52,211
)
(7,885
)
(1,208
)
Non-GAAP EBIT
698,196
703,824
107,866
2,870,777
1,023,247
156,822
Artificial Intelligence
Key Tech Stocks Optimizing AI Usability and Infrastructure for a $20-Trillion Future
![key-tech-stocks-optimizing-ai-usability-and-infrastructure-for-a-$20-trillion-future](https://roboticulized.com/wp-content/uploads/2024/06/150514-key-tech-stocks-optimizing-ai-usability-and-infrastructure-for-a-20-trillion-future.png)
USA News Group CommentaryIssued on behalf of Avant Technologies Inc.
VANCOUVER, BC, June 21, 2024 /PRNewswire/ — USA News Group – Several big winners have been made already in the ongoing artificial intelligence (AI) revolution. However, there’s clearly none bigger than chipmaking giant NVIDIA Corporation (NASDAQ: NVDA), which just surpassed two of its big tech peers to become the most valued publicly-traded company on the planet. To put it into perspective, NVIDIA’s market cap is currently larger than each of Europe’s largest stock markets, while lucky investors who bet $1000 on NVIDIA stock just ten years ago would be sitting on an extra $297,600 today. Now as analysts are predicting that AI and cryptocurrency could inject $20 trillion into the global economy by 2030, the best minds in the tech sector are moving their pieces into place to secure their piece of the pie. Behind the scenes, tech stocks are optimizing the infrastructure, security, and usability of AI, including new developments from Avant Technologies Inc. (OTCQB: AVAI), International Business Machines Corporation (IBC) (NYSE: IBM), Cloudflare, Inc. (NYSE: NET), and Accenture plc (NYSE: ACN).
Known as a pioneer in the sector for its innovative AI technology, Avant Technologies Inc. (OTCQB: AVAI) has improved its main product, Avant AI™. This sophisticated AI system, celebrated for its advanced machine and deep learning capabilities, is adaptable across a wide range of industries.
In a recent strategic development, Avant has signed a Binding Letter of Intent (BLOI) with Flow Wave, LLC (FW), a Florida-based leader in immersible computer server technology. This agreement allows Avant to acquire up to 50 cutting-edge immersible computer servers from FW in a deal valued at $50 million.
“Avant’s revolutionary AI software platform is poised to transform the landscape of data center management,” said William Hisey, CEO of Avant. “By integrating proprietary machine learning algorithms with open-source innovations into these servers, Avant is developing a highly intelligent system designed to optimize resource allocation, enhance performance, and drive unprecedented levels of efficiency and automation. This marks the beginning of a new era for Avant Technologies, positioning us at the forefront of the supercomputer-driven data center industry and setting new standards for managing and storing AI applications.”
Flow Wave Immersible AI Supercomputer Servers are great for heavy AI and machine learning tasks because they have strong processing power, meaning they can analyze data faster and more efficiently. Their special cooling technology uses less energy, saving money and reducing environmental impact. The servers are also compact and easy to set up, making them ideal for data centers with limited space. Plus, their design helps them last longer and require less maintenance.
Avant plans to tackle the challenges of the digital age by buying up to 50 of these high-performance servers from Flow Wave. These servers, with their advanced cooling technology, boost performance and save energy. This deal shows Avant’s dedication to providing top-notch AI infrastructure and improving efficiency. More details about the transaction will be shared once a definitive agreement is finalized.
One of the most active tech giants in the AI space is International Business Machines Corporation (IBC) (NYSE: IBM), which recently released a new methodology through its IBM Research® wing called LAB (Large-Scale Alignment for ChatBots), through an open-source project called InstructLab with its subsidiary Red Hat®, which IBM acquired for $34 billion in 2019. The InstructLab project builds on the LAB technique for a community-driven approach to language model development through skills and knowledge training.
As well, IBM has teamed up with WPP and LinkedIn to launch a new business-to-business (B2B) solution powered by IBM’s AI and data platform watsonx, designed to reinvent how B2B markets identify and engage clients and prospects across the buying journey. WPP Open for B2B will help marketers solve complex B2B marketing challenges, accurately identify and engage buying groups, and improve clients’ return on investment.
“B2B marketers have been focused on creating truly personalized, relevant and consistent experiences for buying groups at scale for years,” said Jonathan Adashek, Senior Vice President of Marketing and Communications at IBM. “Our collaboration with WPP and LinkedIn provides real-time, actionable insights that are based on trusted data. We are excited to create and use these new, powerful and trusted AI solutions to deliver a force multiplier for B2B marketing.”
Cloud-based security solution provider Cloudflare, Inc. (NYSE: NET) recently announced the general availability of its AI Gateway platform, dubbed as a unified interface for managing and scaling the generative AI workloads of clients. Since its beta launch in September 2023, AI Gateway has handled over 500 million requests and is now ready for full client use.
The general availability release followed upon another Cloudflare announcement of a collaboration with Hugging Face, the leading open and collaborative platform for AI builders, for a one-click-simple global deployment for AI applications. With its Workers AI platform now generally available, Cloudflare became the first serverless inference partner integrated on the Hugging Face Hub for deploying models, enabling developers to quickly, easily, and affordably deploy AI globally, without managing infrastructure or paying for unused compute capacity.
“Workers AI is one of the most affordable and accessible solutions to run inference,” said Matthew Prince, CEO and co-founder, Cloudflare. “With Hugging Face and Cloudflare both deeply aligned in our efforts to democratize AI in a simple, affordable way, we’re giving developers the freedom and agility to choose a model and scale their AI apps from zero to global in an instant.”
Reporting impressive generative AI revenues in its latest Q3 2024 fiscal results has caused shares of Accenture plc (NYSE: ACN) to jump this week, reporting more than $900 million in generative AI bookings in the latest quarter alone.
“Our actions to stay laser-focused on the needs of our clients are clear in our third quarter results,” said Julie Sweet, Chair and CEO of Accenture. “We… achieved two significant milestones this quarter — with $2 billion in Generative AI sales year-to-date and $500 million in revenue year-to-date — which demonstrate our early lead in this critical technology.”
Prior to the financial report, Accenture announced its intent to acquire Italian-based network services company, Fibermind, which specializes in fiber and mobile 5G networks deployment, as well as infrastructure engineering services. Together, Accenture and Fibermind will offer clients network engineering capabilities, deep industry knowledge, and technology assets powered by automation, robotics, data and AI.
Prior to its surge into the position as the world’s most valuable publicly-traded company, NVIDIA Corporation (NASDAQ: NVDA) made a pair of announcements, further cementing its role in the AI revolution.
The first was the announcement of its NVIDIA Omniverse Cloud Sensor RTX, a set of microservices that enable physically accurate sensor simulation to accelerate the development of fully autonomous machines of every kind, allowing developers to test sensor perception and associated AI software at scale in physically accurate, realistic virtual environments prior to real-world deployment.
The second announcement was the NVIDIA AI Computing by HPE, a portfolio of AI solutions and joint go-to-market integrations that enable enterprises to accelerate adoption of generative AI, co-developed with Hewlett Packard (HP).
“Generative AI and accelerated computing are fueling a fundamental transformation as every industry races to join the industrial revolution,” said Jensen Huang, Founder and CEO of NVIDIA. “Never before have NVIDIA and HPE integrated our technologies so deeply – combining the entire NVIDIA AI computing stack along with HPE’s private cloud technology – to equip enterprise clients and AI professionals with the most advanced computing infrastructure and services to expand the frontier of AI.”
All NVIDIA AI Computing offerings by HPE will be available through a combined marketing strategy involving sales teams, channel partners, and training. This strategy includes a global network of system integrators such as Deloitte, HCLTech, Infosys, TCS, and Wipro. These integrators will assist enterprises across various industries in running complex AI workloads.
Source: https://usanewsgroup.com/2023/10/26/unlocking-the-trillion-dollar-ai-market-what-investors-need-to-know/
CONTACT:
USA NEWS [email protected](604) 265-2873
DISCLAIMER: Nothing in this publication should be considered as personalized financial advice. We are not licensed under securities laws to address your particular financial situation. No communication by our employees to you should be deemed as personalized financial advice. Please consult a licensed financial advisor before making any investment decision. This is a paid advertisement and is neither an offer nor recommendation to buy or sell any security. We hold no investment licenses and are thus neither licensed nor qualified to provide investment advice. The content in this report or email is not provided to any individual with a view toward their individual circumstances. USA News Group is a wholly-owned subsidiary of Market IQ Media Group, Inc. (“MIQ”). MIQ has been paid a fee for Avant Technologies Inc. advertising and digital media from the company directly. There may be 3rd parties who may have shares Avant Technologies Inc., and may liquidate their shares which could have a negative effect on the price of the stock. This compensation constitutes a conflict of interest as to our ability to remain objective in our communication regarding the profiled company. Because of this conflict, individuals are strongly encouraged to not use this publication as the basis for any investment decision. The owner/operator of MIQ own shares of Avant Technologies Inc. which were purchased as a part of a private placement. MIQ reserves the right to buy and sell, and will buy and sell shares of Avant Technologies Inc. at any time thereafter without any further notice. We also expect further compensation as an ongoing digital media effort to increase visibility for the company, no further notice will be given, but let this disclaimer serve as notice that all material disseminated by MIQ has been approved by the above mentioned company; this is a paid advertisement, and we own shares of the mentioned company that we will sell, and we also reserve the right to buy shares of the company in the open market, or through further private placements and/or investment vehicles. While all information is believed to be reliable, it is not guaranteed by us to be accurate. Individuals should assume that all information contained in our newsletter is not trustworthy unless verified by their own independent research. Also, because events and circumstances frequently do not occur as expected, there will likely be differences between any predictions and actual results. Always consult a licensed investment professional before making any investment decision. Be extremely careful, investing in securities carries a high degree of risk; you may likely lose some or all of the investment.
View original content:https://www.prnewswire.co.uk/news-releases/key-tech-stocks-optimizing-ai-usability-and-infrastructure-for-a-20-trillion-future-302179234.html
Artificial Intelligence
2024 World Intelligence Expo Begins with a Grand Opening in Tianjin
![2024-world-intelligence-expo-begins-with-a-grand-opening-in-tianjin](https://roboticulized.com/wp-content/uploads/2024/06/150508-2024-world-intelligence-expo-begins-with-a-grand-opening-in-tianjin.jpg)
TIANJIN, China, June 21, 2024 /PRNewswire/ — On June 20th, Tianjin hosted the opening of the 2024 World Intelligence Expo (WIE). Under the theme “Intelligence: Expansive Development Space, Sustainable Growth Driver,” the event was co-organized by the people’s governments of the Tianjin and Chongqing municipalities.
Chinese President Xi Jinping sent a congratulatory letter to the expo, pointing out that AI, as an important driving force for a new round sci-tech revolution and industrial transformation, will have a far-reaching impact on global economic and social development and human civilization progress. In his letter, Xi also noted that China has attached great importance to the development of AI, actively driven the deep integration of the Internet, big data and AI with real economy to cultivate and build the intelligent industry, accelerate the development of new quality productivity, and provide new momentum for high-quality development.
Chen Min’er, secretary of the CPC Tianjin Committee, addressed the opening ceremony of the expo. Wan Gang, chairman of China Association for Science and Technology, delivered the keynote speech. Hu Henghua, mayor of Chongqing; Wu Zhaohui, vice president of Chinese Academy of Sciences; Liu Liehong, head of the National Data Administration; Long Teng, vice minister of the Ministry of Science and Technology; and Shan Zhongde, vice minister of the Ministry of Industry and Information Technology, addressed the expo, respectively. Tianjin Mayor Zhang Gong presided over the opening ceremony.
In his speech, Chen Min’er pointed out that Tianjin has been adhering to sci-tech innovation and industrial innovation at the same time, actively propelling exploration and practical applications in the realm of AI, and accelerating the development of new quality productivity to better empower its high-quality development and living. Chen added, “Leading sci-tech innovation with intelligence, Tianjin will rev up the R&D and application of some key core technologies, vigorously develop the sci-tech service sector, streamline the supply and demand channels for sci-tech achievements, boost sci-tech and innovation parks to improve their quality and efficiency, and accelerate the inter-sector application of AI to help innovation and breakthroughs in the fields of life science, low-carbon technology, and future research.
According to Hu Henghua, Chongqing is speeding up in digital industrialization and industrial digitization to build itself into a new digital economy highland. The 2025 World Intelligence Expo is scheduled to be held in Chongqing. Hu invited everyone to delineate a new AI landscape together, share golden opportunities during the digitization of Chongqing, and co-build a promising future in the AI era.
Wu Zhaohui suggested strengthening the inter-discipline cooperation to consolidate the AI research foundation, enriching AI scenarios with applets, and deepening industry-institute interactions to build an AI innovation ecosystem.
Zeng Yi, chairman of China Electronics Corporation; Chen Zhongyue, chairman of China Unicom; Yang Yuanqing, chairman and CEO of Lenovo; and Zhou Hongyi, founder of Qihoo 360 delivered speeches.
Contact: Xing MeiqiTel: 0086-22-28209030E-mail: [email protected]
Photo: https://mma.prnewswire.com/media/2444782/Wan_Gang_Keynote_Speech.jpgPhoto: https://mma.prnewswire.com/media/2445109/World_Intelligence_Expo_2024.jpgLogo: https://mma.prnewswire.com/media/2444783/4775554/WIE_Logo.jpg
View original content:https://www.prnewswire.co.uk/news-releases/2024-world-intelligence-expo-begins-with-a-grand-opening-in-tianjin-302179192.html
Artificial Intelligence
Tech Developers Pioneering AI Tools to Revolutionize Future Productivity and Logistics
![tech-developers-pioneering-ai-tools-to-revolutionize-future-productivity-and-logistics](https://roboticulized.com/wp-content/uploads/2024/06/150510-tech-developers-pioneering-ai-tools-to-revolutionize-future-productivity-and-logistics.png)
USA News Group CommentaryIssued on behalf of Scope AI Corp.
VANCOUVER, BC, June 21, 2024 /PRNewswire/ — USA News Group – How we embrace this surging adoption of artificial intelligence (AI) in the economy of the future remains up for debate. Already, we’re seeing the impact of AI adoption in the workplace, in culture, and in finance, but it won’t end there. According to Goldman Sachs, AI is showing “very positive” signs of eventually boosting GDP and productivity, while some experts are remarking that the generative AI tech wave is sweeping in much faster (maybe 10x) than early internet. Behind the scenes, tech developers are building AI-powered tools that could potentially revolutionize productivity and logistics in the future, with recent developments coming from Scope AI Corp. (CSE: SCPE) (OTCQB: SCPCF), Meta Platforms, Inc. (NASDAQ: META), Amazon.com, Inc. (NASDAQ: AMZN), Microsoft Corporation (NASDAQ: MSFT), and SoundHound AI, Inc. (NASDAQ: SOUN, SOUNW).
As deep machine learning evolves rapidly, Scope AI Corp. (CSE: SCPE) (OTCQB: SCPCF) has rebranded and shifted its market focus to target sectors such as advertising, gaming, and neural networks with its advanced GEM (General Enterprise Machine Learning) technology.
Scope AI’s ongoing development of GEM aims to assist businesses in creating custom object detection and visual information systems, maximizing the potential of neural networks. The company’s strategic initiatives are set to potentially revolutionize advertising personalization, gaming enhancements, and various applications of neural networks.
Recently, Scope AI unveiled significant enhancements to GEM, designed to better serve advertising agencies and the gaming industry. These updates aim to optimize advertising content and improve gameplay experiences through advanced neural network functionalities. By the end of May, Scope AI had announced its collaboration with several leading ad agencies and ad networks, to gain insights into the primary challenges these organizations face in analyzing the efficacy of different ad creatives and page layouts, as well as the difficulties and costs associated with testing.
The timing of Scope AI’s assistance in advertising couldn’t be better, as global advertising executives are currently struggling with the injection of AI into their sphere. The worry is that if everyone is using AI for their images, nothing stands out. This is where Scope AI’s potential with GEM rises, in helping these ad execs to better discern their ad campaigns, and how to deliver them.
“Our approach is to start with the pain points of our potential users and build solutions based on those insights,” said James Young, CEO of Scope AI Corp. “We believe in understanding the real-world challenges faced by our partners, rather than falling into the common software trap of ‘build it and they will come.’ This collaboration ensures that GEM is not just another tool, but a solution that addresses the specific needs of the advertising community.”
GEM’s enhanced object visual recognition capabilities are intended to provide businesses with deeper insights and more precise solutions. Consequently, advertisers may potentially analyze consumer behavior more effectively and refine their campaigns, while game developers could create more engaging and immersive user experiences.
“We’re very pleased at how seamless we were able to streamline, enhance, and strengthen our platform with the latest performance and security upgrades made to our infrastructure,” said Sean Prescott, Founder and Non-Executive Chairman of Scope AI. “The next generation of our platform will set us apart in what kind of data and its sensitivity we can process and store. It’s a potential game-changer for the industry.”
Social media platform giant Meta Platforms, Inc. (NASDAQ: META) recently announced an initiative to release new AI research models in order to accelerate innovation at scale. As per the initiative, Meta’s Fundamental AI Research team is publicly releasing several models to accelerate future research and allow others to innovate and apply AI at scale.
According to the accompanying Meta blog post, the company states, “We believe that access to state-of-the-art AI creates opportunities for everyone.”
Meanwhile, however, Meta has also been asked to delay training its AI on data from users in the European Union. After intervention by the Irish Data Protection Commission, Meta now must delay its plan to train its large language models on Facebook and Instagram content from EU users.
“We’re disappointed by the request from the Irish Data Protection Commission (DPC), our lead regulator, on behalf of the European DPAs, to delay training our large language models (LLMs) using public content shared by adults on Facebook and Instagram — particularly since we incorporated regulatory feedback and the European DPAs have been informed since March,” wrote Stefano Fratta, Global Engagement Director for Privacy Policy for Meta in a blog post. “This is a step backwards for European innovation, competition in AI development and further delays bringing the benefits of AI to people in Europe.”
Meanwhile, Amazon.com, Inc. (NASDAQ: AMZN) seems undeterred in Europe, expanding its generative AI listing tools to sellers across the continent. As per the expansion, sellers in France, German, Italy, Spain, and the UK can now leverage the power of generative AI to greatly simplify the process of product listing creation as well as enriching existing product listings to better resonate with customers and help drive sales.
“These generative AI-powered tools simplify the listing creation process, allowing sellers to generate compelling product titles, descriptions, and other details by simply providing a few descriptive words or just uploading a product image,” said Amazon in the accompanying blog post. “We suggest product listings that are high-quality and designed to be engaging for customers in our store. This streamlines operations and allows sellers to focus on other aspects of their business.”
Amazon has long utilized AI to assist its selling partners by pioneering personalized product recommendations based on customer behavior, enabling sellers to highlight relevant products. Advanced machine learning models are used for demand forecasting and inventory management, helping sellers avoid stock shortages. AI-powered pricing tools provide dynamic pricing insights, while recent innovations include generating rich Premium A+ Content and augmented reality visualizations. In fulfillment centers worldwide, AI helps stock products locally to ensure faster deliveries and greater availability of everyday essentials. In Europe, AI reduced the average package travel distance by 25kms in 2023, enhancing delivery speed and sustainability.
Microsoft Corporation (NASDAQ: MSFT) recently decided to delay the release of its Recall AI feature on PCs, based on security concerns. The Recall feature logs activities from web browsing to voice chats, creating a searchable history on the user’s computer. This allows users to easily find and recall actions from months ago.
Experts are already labeling Microsoft as a “frontrunner in the generative AI race”, with analysts expecting big things from the software giant, citing a “strong competitive cloude edge” coming, as they estimate Microsoft’s Copilot deployments could add around $25 billion to the company’s trajectory by fiscal year 2025.
Together with LinkedIn, Microsoft also released the 2024 Work Trend Index on the State of AI at Work, titled “AI at work is here. Now comes the hard part.”
“Generative AI tools have found widespread acceptance in the workplace, and we can see that most employees have placed their trust in AI to help with their daily workloads – without waiting to see if their organization will provide AI tools, services, or directions and guidelines for usage,” said Dhanawat Suthumpun, Managing Director of Microsoft Thailand. “It is critical that business leaders respond to this emerging trend in order to help both the organization and employees make the most beneficial impact from AI – from increased productivity and new capabilities to greater security from well-defined guidance around AI use.”
Global leader in voice artificial intelligence SoundHound AI, Inc. (NASDAQ: SOUN, SOUNW) recently announced the acquisition of key assets from Allset, an online ordering platform that connects restaurants and local customers, to fast-track its vision of a voice commerce ecosystem. Allset is a food ordering platform designed for local pick-up, providing a seamless, cost-effective dining experience that allows both consumers and restaurants to bypass the high fees charged by delivery apps. SoundHound is already a market leader for restaurant voice AI solutions, working with over 10,000 restaurant locations.
“We are thrilled to join forces with SoundHound to combine our established partnerships and marketplace expertise with SoundHound’s class-leading voice AI solutions and capabilities,” said Stas Matviyenko, CEO and Co-Founder of Allset. “From the beginning, we realized that we share the same vision for the voice commerce ecosystem that elevates the consumer experience. This team-up will accelerate our progress toward the next exciting phase of AI-powered ordering convenience.”
Article Source: https://usanewsgroup.com/2024/04/26/the-currency-of-tomorrow-why-investing-in-cutting-edge-ai-recognition-tech-could-mean-big-money/
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