360 DigiTech, Inc. (NASDAQ:QFIN) Q2 2023 Earnings Call Transcript

Plus, our operational efforts, we have gained efficiency improvement in managing the broadly defined SME segment. Given the softer consumer credit demand, we expect to increase our spending on the broadly defined SME users. We will increase our — further, we will increase our penetration in the broadly defined customer segments in new user acquisition. And for the existing users, we will improve our service quality to improve the user’s stickiness. In terms of the pricing, we expect the pricing will be stable in the future. From our past experience, the LPR rise, or cuts, had very little impact on our pricing. Our pricing is mainly determined by the supply and demand in this market.

Operator: One moment for the next question. Next question is from the line of Yada Li from CICC.

Yada Li: I’ll do my translation. This is Yada with CICC and today I just have one quick question. I was wondering could you please elaborate more about the consideration behind the $150 million share repurchase program this time? And should we consider it as a regular way to return value to the shareholders?

Wu Haisheng : [Foreign Language]

Alex Xu: Okay. Yada, thanks for the question. Basically, every quarter, we are reviewing our cash position as well as our capital allocation kind of a strategy. And when we determine that there are actual — we consider the free cash sitting there idle without making too much of a return, then we would like to deploy that cash either in the form of the dividends or in the form of the buyback, okay. So that’s a — it’s, I would say, an ongoing process in future quarters as well. And we consider an optimal balance between the buyback and a dividend, is the best way to return to the shareholders. So like I said, the first thing first, we need to complete this USD 150 million buyback program and, along the way, we will do our periodical review to determine what to do afterwards there. But, longer term, I would say some kind of a combination between the buyback and the dividend.

Operator: Thank you for the questions. In the interest of time, I will now conclude the Q&A session. I would like to hand the call back to management for closing remarks.

Alex Xu: Okay. Thanks for everyone joining the conference. Since we have our peers right behind us in their earnings call, so to their courtesy, we just conclude our call here. If you have additional questions, please contact us offline. Thank you.

Operator: Thank you. This concludes today’s conference call. Thank you for participating. You may now disconnect.