The income statement reflects a broken core model, with net interest income collapsing from a positive $3.2B in Q1 2023 to negative $114.8M in Q2 2026, while credit provisions of $5.4B in Q3/Q4 2025 overwhelmed all revenue streams.
Lufax Holding Ltd (LU) annual income statement — 8-year revenue, gross profit & net income history
| Metric | TTM | Dec'25 | Dec'23 | Dec'22 | Dec'21 | Dec'20 | Dec'19 | Dec'18 | Dec'17 |
|---|
| Net Interest Income | 2.95B | 15.49B | 12.17B | 18.33B | 13.74B | 6.54B | 2.58B | 5.18B | 6.33B |
| NII Growth % | -177.48% | 27.29% | -33.63% | 33.42% | 109.96% | 153.27% | -50.13% | -18.1% | - |
| Net Interest Margin % | 1.46% | 7.44% | 5.13% | 5.25% | 3.81% | 2.63% | 1.73% | 4.39% | 3.51% |
| Interest Income | 6.15B | 16.44B | 21.38B | 31.58B | 24.15B | 12.74B | 5.58B | 10.62B | 15.03B |
| Interest Expense | 161.56M | 954.68M | 9.21B | 13.24B | 10.41B | 6.19B | 3B | 5.44B | 8.7B |
| Loan Loss Provision | 14.78B | 6.1B | 3.48B | 360.32M | 6.37B | 3.02B | 1.86B | 934.59M | 2.63B |
| Non-Interest Income | 20.45B | 11.69B | 20.3B | 37.45B | 40.87B | 38.26B | 38.19B | 30.01B | 17.32B |
| Non-Interest Income % | 87.39% | 43% | 62.52% | 67.13% | 74.84% | 85.39% | 93.66% | 85.28% | 73.24% |
| Total Net Revenue | 23.4B | 27.18B | 32.47B | 55.78B | 54.61B | 44.8B | 40.77B | 35.19B | 23.64B |
| Revenue Growth % | 3.99% | -16.31% | -41.79% | 2.15% | 21.89% | 9.89% | 15.87% | 48.82% | - |
| Non-Interest Expense | 11.74B | 21.52B | 14.19B | 21.6B | 24.84B | 23.88B | 19.47B | 15.6B | 12.65B |
| Efficiency Ratio | 50.16% | 79.17% | 43.7% | 38.72% | 45.48% | 53.29% | 47.76% | 44.34% | 53.51% |
| Operating Income | -77.2M | -438.84M | 14.8B | 33.82B | 23.4B | 17.91B | 19.43B | 18.65B | 8.36B |
| Operating Margin % | -0.33% | -1.61% | 45.58% | 60.63% | 42.85% | 39.97% | 47.67% | 53% | 35.37% |
| Operating Income Growth % | - | -102.97% | -56.24% | 44.54% | 30.66% | -7.84% | 4.21% | 122.98% | - |
| Pretax Income | -2.13B | -562.01M | 1.65B | 13.01B | 23.4B | 17.91B | 19.43B | 18.65B | 8.36B |
| Pretax Margin % | -9.1% | -2.07% | 5.07% | 23.33% | 42.85% | 39.97% | 47.67% | 53% | 35.37% |
| Income Tax | 135.23M | 1.1B | 610.63M | 4.24B | 6.69B | 5.63B | 6.12B | 5.07B | 2.34B |
| Effective Tax Rate % | -6.35% | -196.26% | 37.12% | 32.57% | 28.59% | 31.45% | 31.47% | 27.2% | 27.94% |
| Net Income | -2.65B | -2.04B | 886.87M | 8.7B | 16.8B | 12.35B | 13.33B | 13.62B | 5.97B |
| Net Margin % | -11.34% | -7.51% | 2.73% | 15.6% | 30.77% | 27.57% | 32.7% | 38.71% | 25.23% |
| Net Income Growth % | -9.95% | -330.08% | -89.81% | -48.23% | 36.02% | -7.34% | -2.11% | 128.31% | - |
| Net Income (Continuing) | -2.27B | -1.66B | 1.03B | 8.78B | 16.71B | 12.28B | 13.32B | 13.58B | 6.03B |
| EPS (Diluted) | -6.12 | -4.76 | 3.08 | 30.32 | 53.52 | 44.40 | 49.08 | 50.60 | 22.42 |
| EPS Growth % | 14.93% | -254.55% | -89.84% | -43.35% | 20.54% | -9.54% | -3% | 125.69% | - |
| EPS (Basic) | - | -4.76 | 3.10 | 30.40 | 56.88 | 44.76 | 49.08 | 50.60 | 22.42 |
| Diluted Shares Outstanding | 433.34M | 433.34M | 286.79M | 286.84M | 339.94M | 276.01M | 271.67M | 269.22M | 266.14M |
Quick answers to the most common questions about buying LU stock.
For fiscal year 2025, Lufax Holding Ltd (LU) reported total revenue of $27.18B. This represents a 14.9% increase compared to $23.64B in 2017.
Lufax Holding Ltd (LU) reported a net loss of $2.04B for the fiscal year ending 2025.
Lufax Holding Ltd (LU) reported an operating income of $-438.8M, resulting in an operating profit margin of -1.6%. This margin reflects the operational efficiency of the business before interest and taxes.
Lufax Holding Ltd (LU) generated $21.08B in gross profit for the year, representing a gross profit margin of 77.6%. This demonstrates the company's core pricing power and production efficiency.
Key Metrics
Top Statement Risk
Structural revenue decline and credit losses
Net Interest Income Collapses to Negative
Lufax's net interest income has deteriorated from a positive $3.2B in Q1 2023 to a negative $114.8M in Q2 2026, a complete reversal that signals the core lending economics have broken down under the weight of the risk-bearing transition and a shrinking loan book.
The shift to a 100% risk-bearing model has fundamentally altered the NII profile, as the company now bears the full cost of funding while its asset base contracts. The negative NIM of -0.1% in the latest quarter indicates that the interest expense on its liabilities now exceeds the yield on its remaining assets, a situation that is unsustainable without a significant reversal in loan volume or a dramatic improvement in asset yields. This trajectory suggests the company is in a managed runoff of its legacy facilitated loan portfolio, with the negative NII acting as a direct drag on any potential return to profitability.
Negative NIM Signals Broken Economics
The net interest margin has collapsed from a stable 1.0%-1.3% range in 2023 to -0.7% in late 2025 and -0.1% in Q2 2026, indicating that the company's funding costs now exceed the yields on its earning assets, a critical inflection point for any financial institution.
This negative NIM is a direct consequence of the strategic pivot to risk-bearing, where Lufax is likely funding assets at market rates while the yields on its legacy, lower-risk facilitated loans roll off. The compression suggests that the company is unable to reprice its asset base quickly enough to match its rising cost of capital, or that the quality of the remaining loan book is deteriorating, forcing lower yields. Investors should monitor whether this is a temporary transitional effect or a permanent impairment of the company's core spread-generating capability.
Provisions Dominate the Income Statement
Credit impairment provisions have consistently consumed a massive portion of revenue, peaking at $5.4B in Q3/Q4 2025 against $8.0B in total revenue, indicating that the risk-bearing model is generating severe losses that overwhelm any remaining fee income.
The scale of provisioning relative to revenue is alarming; in Q2 2026, provisions of $883.7M still represent a significant portion of the $6.2B revenue base, even as the balance sheet shrinks. This pattern suggests that asset quality in the small business owner segment remains under severe stress, and the company's underwriting standards or collection capabilities may be insufficient for the risk it is now retaining. The persistent negative operating income, despite a high gross margin, confirms that credit costs are the primary driver of the company's unprofitability.
Fee Income Volatility Masks Core Weakness
Non-interest income has swung wildly from $5.2B in Q1 2023 to $665.9M in Q2 2024 and back to $6.2B in Q2 2026, suggesting that a large, non-recurring component is distorting the true underlying fee generation capacity of the business.
The extreme volatility in fee income, which now constitutes over 100% of total revenue in some quarters, indicates that the company's core, recurring fee streams from loan facilitation and wealth management have likely collapsed. The large swings may be driven by one-time items such as guarantee liability adjustments, fair value changes, or the consolidation of trust plans, rather than sustainable business activity. This makes it difficult to assess the true earning power of the platform and suggests the company is reliant on accounting adjustments to report positive top-line figures.
The Pivot to Risk-Bearing Broke the Model
The strategic decision to shift to a 100% risk-bearing model, fully evident by 2024, represents the critical inflection point where Lufax transformed from a profitable, capital-light platform into a loss-making, capital-intensive credit entity with negative net interest income.
Prior to this shift, the company generated consistent positive NII and operating income. The inflection is stark: from Q2 2023 to Q2 2026, total revenue fell from $7.7B to $6.2B, but more importantly, the composition changed from balanced NII and fees to a structure where negative NII and volatile fees mask deep operational losses. This pivot appears to have been a regulatory necessity but has destroyed the previous earnings model without yet establishing a viable new one, as evidenced by the persistent negative operating and net margins.
Cash Pile May Be a Regulatory Illusion
While the company reports a cash position of $41.1B, the negative NIM and massive provisions suggest a significant portion of this capital is likely encumbered by regulatory requirements or guarantee obligations, limiting its availability to absorb further losses or fund a turnaround.
The market may be valuing the cash at face value, but the operational reality of a risk-bearing lender in a stressed credit environment implies that much of this liquidity is restricted. The negative NIM means the company is paying more to hold this cash than it is earning, creating a direct economic drag. Furthermore, if the $41.1B is primarily held to backstop guarantee liabilities or satisfy PBOC requirements, its true discretionary value for equity holders could be a fraction of the reported figure, making the deep discount to book value less of a bargain and more of a reflection of trapped capital.