Why Are OneConnect Shares Falling Today

Nabaparna Bhattacharya
1 min read
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In this article:

  • OneConnect Financial Technology Co., Ltd. (NYSE: OCFT) shares are falling Monday morning after reporting the first quarter of FY23 results.

  • The company reported Q1 sales of $135.33 million, missing the consensus estimate of $143.91 million.

  • The China-based cloud-platform Fintech solutions registered a GAAP EPADS loss of $0.439, beating the analyst consensus of a $0.530 loss.

  • Sales were impacted by a decline in transaction-based and support revenue and reduced customized projects with low margins in Q1.

  • Revenues in the Digital Banking segment fell 33.2% Y/Y, the Digital Insurance segment fell 4%, the Gamma Platform segment rose 7.5%, and the Virtual Bank Business segment rose 51.6%.

  • The company's strategy of focusing less on low-margin projects, coupled with disciplined execution of cost control and improved marketing efficiency, boosted margins in the quarter under review.

  • "Our overseas business continued its growth momentum at the beginning of 2023; virtual banks in Hong Kong recorded a 51.6% year-over-year revenue increase in business in the first quarter," said CEO Shen Chongfeng.

  • "We will continue to capture the growing overseas demand for digital transformation and seize the opportunities that arise."

  • Price Action: OCFT shares fell by 6.63% to $4.51 on the last check Monday.

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This article Why Are OneConnect Shares Falling Today originally appeared on Benzinga.com

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