Tiger, Futu post strong overseas gains after Beijing clampdown stalls mainland growth

Tiger Brokers and Futu Holdings, two leading online brokerages in the region, experienced strong second-quarter growth as they capitalized on Beijing's strict crackdown on illegal cross-border stock trading. In their latest financial report, UP Fintech Holding, the parent company of Tiger Brokers, disclosed a 31.4% year-on-year increase in revenue to a record US$182.3 million.

However, net income attributable to shareholders decreased to US$39.4 million from US$41.4 million in the previous year. Chairman and CEO Wu Tianhua revealed that the majority of the 32,600 new funded accounts during the quarter originated from Singapore and Hong Kong, resulting in a 10.3% year-on-year increase in total accounts to 1.32 million.

Client assets also grew by 16.7% to US$60.7 billion. To facilitate users' compliance procedures and minimize tax declaration complications, Tiger launched a dedicated tax reporting tool under its Hong Kong, Singapore, and New Zealand regulatory licenses. Additionally, Tiger introduced fractional share trading for Singapore-listed stocks and index options trading in Hong Kong.

Hong Kong client assets grew nearly 30% quarter-on-quarter following intensified offline client-acquisition campaigns, while assets in the US surged nearly 50%, and those in Australia and New Zealand expanded by more than 30%. On the other hand, Futu reported HK$7.2 billion (US$918 million) in revenue, a 35.6% increase, and net income attributable to shareholders of HK$3.64 billion, up 41.6%.

Funded accounts rose by 33.6% to 3.84 million, primarily driven by Malaysia, with Hong Kong and Singapore also contributing significantly. These impressive results come two months after mainland Chinese authorities intensified a long-standing campaign against unlicensed cross-border brokerages, aiming to eradicate illegal securities activity and curb unauthorized capital outflows.

On May 22, the China Securities Regulatory Commission imposed a combined fine of 2.2 billion yuan (US$327 million) on Tiger, Futu, and Longbridge Securities, ordering a two-year shutdown of their remaining mainland operations. With Beijing's clampdown stripping the two brokerages of their primary growth engine, they have adapted their business models to attract retail investors in Southeast Asia, North America, and Europe.

In July, Futu obtained a license from Thailand's securities regulator to launch its Moomoo platform, expanding its overseas presence beyond Hong Kong, Singapore, and Malaysia. The brokerage also broadened its global product offerings, introducing prediction markets in the US in June and gaining regulatory approval in Hong Kong for a virtual-asset financing service through its PantherTrade platform.

While neither brokerage disclosed updated metrics on mainland account exposure in their latest earnings statements, it is known that mainland Chinese investors constituted approximately 13% of Futu's funded accounts in the first quarter, and roughly 10% for Tiger at the end of the previous year.