Executive Summary / Key Takeaways

• Record-Breaking Performance and Profitability: UP Fintech Holding Limited ($TIGR) achieved record highs in Q2 2025 across total revenue, trading volume, commission income, and net income, with its non-GAAP net profit margin reaching an all-time high of 32%. This performance underscores a robust and increasingly stable business model.
• Strategic Focus on High-Quality User Acquisition: The company is deliberately prioritizing the acquisition of high-net-worth users, particularly in key markets like Hong Kong and Singapore, leading to significantly higher average net asset inflows per new client and improved overall customer acquisition cost efficiency.
• Technological Leadership and Digital Asset Expansion: TIGR's continuous investment in its proprietary TigerAI platform, coupled with its aggressive expansion into virtual asset trading through YAX Hong Kong (holding HK SFC Type 1 and Type 7 licenses, and licenses in 14 U.S. states), positions it as a bridge between traditional and digital finance, driving strong growth in crypto trading volumes and assets under custody.
• Hong Kong as a Growth Engine: The Hong Kong market has emerged as a critical strategic pillar, demonstrating substantial growth in client assets (up 50% QOQ in Q2 2025) and new funded accounts, achieving breakeven in Q4 2024, and boasting the highest ARPU among all regions.
• Diversified Revenue Streams and Operational Leverage: Beyond core brokerage, TIGR's 2B business (IPO underwriting, ESOP management) and rapidly expanding wealth management services are contributing significantly to revenue, while prudent cost management is enhancing operating leverage despite increased strategic investments.

A Digital Brokerage Ascendant: Setting the Scene for UP Fintech

UP Fintech Holding Limited, operating under the brand Tiger Brokers, has rapidly evolved since its founding in Singapore in 2014 into a prominent online brokerage firm catering to global investors, with a particular focus on the burgeoning Chinese market. Its core offering, the Tiger Trade platform, provides a comprehensive suite of financial instruments, including stocks, options, and futures, accessible through its intuitive mobile application and website. This foundational technology has been instrumental in shaping its strategic trajectory, enabling a seamless, user-friendly experience that underpins its growth.

The company's overarching strategy centers on leveraging technological innovation, expanding its high-quality user base in strategic markets, and diversifying its service offerings to create a holistic financial ecosystem. This approach is particularly relevant in the current market, where digital transformation in finance is accelerating, and investor demand for accessible, sophisticated trading and wealth management tools is on the rise. Market volatility, often seen as a challenge, is viewed by Tiger Brokers as a driver of trading volume, a dynamic it actively capitalizes on as a broker-dealer.

In the competitive landscape, Tiger Brokers operates alongside established players like Futu Holdings (FUTU), Robinhood Markets (HOOD), Interactive Brokers (IBKR), and XP Inc. (XP). While Futu Holdings shares a similar focus on Asian markets and technological innovation, Tiger Brokers differentiates itself through its specialized emphasis on Chinese investors and robust ESOP management services, giving it a qualitative edge in these niche segments. Against Robinhood, Tiger Brokers offers greater depth in international asset access for its target demographic and a more comprehensive suite of professional tools, contrasting with Robinhood's mass-market, commission-free appeal. Compared to Interactive Brokers, which excels in advanced tools for professional traders, Tiger Brokers maintains a more consumer-oriented approach with strong community engagement and educational features. XP Inc., focused on Latin American emerging markets, presents a parallel in regional specialization, though Tiger Brokers' technology integration for Chinese users may offer a distinct advantage.

Technological Edge: The Power of TigerAI and Digital Assets

At the heart of Tiger Brokers' competitive strategy lies its continuous investment in proprietary technology, most notably its AI-powered investment assistant, TigerAI. Initially launched as TigerGPT, this platform was officially upgraded to TigerAI in Q1 2025, expanding to a dual-model architecture and integrating with users' watchlists and portfolio data. This advanced capability allows TigerAI to deliver more personalized and relevant investment insights, with user satisfaction exceeding 80% following the upgrade. This technological differentiation provides tangible benefits, enhancing user engagement and decision-making, thereby contributing to a stronger competitive moat and potentially higher ARPU.

Beyond traditional brokerage, Tiger Brokers is aggressively expanding its footprint in the digital asset market, aiming to develop a comprehensive one-stop platform that seamlessly connects traditional financial assets with digital ones. Its cryptocurrency platform, YAX Hong Kong, received Type 1 and Type 7 licenses from the Hong Kong SFC in Q4 2024, officially establishing it as a licensed virtual asset trading platform. This enables legal spot trading and custody services for major cryptocurrencies like Bitcoin and Ether, as well as tokenized assets. The company also holds digital asset trading licenses in 14 U.S. states, with an application actively progressing in Singapore. This strategic move is already yielding results, with digital asset trading volume increasing approximately 65% quarter-over-quarter in Q2 2025, and assets under custody on its exchange nearly doubling sequentially. This expansion into Web3, supported by partnerships with seasoned strategic investors in the ecosystem, is crucial for long-term growth and market positioning, allowing Tiger Brokers to capture a share of this rapidly evolving asset class.

Further technological enhancements include advanced options features like pending order reminders for expiry dates and conditional market orders for single-leg options, designed to improve user experience and trading efficiency. In Q1 2025, the company also launched equity repo and delivery versus payment features, significantly improving the efficiency of its stock borrowing and lending operations and strengthening its service capabilities for institutions and high-net-worth clients. These innovations collectively contribute to a robust product set, particularly in U.S. derivatives and virtual asset trading, which sets Tiger Brokers apart in a competitive market.

Financial Performance: A Trajectory of Growth and Profitability

Tiger Brokers has demonstrated a compelling financial trajectory, culminating in record-breaking performance in the second quarter of 2025. Total revenue for Q2 2025 reached an impressive $138.7 million, marking a 58.7% year-over-year increase and a 13.1% quarter-over-quarter growth. This was driven by robust growth across all key revenue components. Commission income surged to $64.8 million, up 90.1% year-over-year and 11.1% quarter-over-quarter, fueled by a significant increase in trading volume to $284 billion. Net interest income also saw healthy growth, reaching $58.7 million, a 32.8% year-over-year increase, benefiting from an expanded user base and increased Average Revenue Per User (ARPU). The margin financing and securities lending balance further expanded to $5.7 billion, reflecting a 65.3% year-over-year growth.

Profitability metrics underscore the company's operational effectiveness. GAAP net income attributable to UP Fintech for Q2 2025 was $41.4 million, a 36.2% increase from the previous quarter and a sixteen-fold increase year-over-year. Non-GAAP net income reached $44.5 million, growing 23.5% sequentially and 8.6 times the figure from the same quarter last year. The non-GAAP net profit margin expanded to a record high of 32% in Q2 2025, marking its fourth consecutive quarter of increase. For the first half of 2025, operating profit and net profit have already exceeded the total for the entire previous year, signaling a more stable and healthier business model.

The company's liquidity and capital resources remain robust, supported by strong net asset inflows. In Q2 2025, net asset inflows reached $3 billion, with over 70% contributed by retail investors. Total client assets hit a new record of $52.1 billion, representing a 13.5% quarter-over-quarter and 36.3% year-over-year increase, marking eleven consecutive quarters of growth. This consistent growth in client assets, coupled with effective management of interest-bearing assets, contributes to a healthy interest income stream. The company's prudent management of fixed costs, with employee compensation and general & administrative expenses remaining relatively stable, has significantly improved its operating leverage, as evidenced by a 45% quarter-over-quarter growth in operating profit in Q3 2024 (excluding a one-off impairment), substantially outpacing its top-line growth.

Operational Momentum and Strategic Expansion

Tiger Brokers' operational achievements reflect its strategic focus on market penetration and user quality. In Q2 2025, the company added 39,800 new funded accounts, primarily driven by Singapore and Hong Kong. This brought the total number of funded accounts to 1,192,700, a 21.4% year-over-year increase. Crucially, the quality of these newly funded users is improving, with the average net asset inflow exceeding $20,000, reaching a historic high, and notably around $30,000 in Hong Kong and Singapore. This focus on high-quality users, rather than sheer volume, has proven effective, as the nearly 40,000 new users in Q2 2025 contributed more net asset inflow than the over 60,000 new users in Q1 2025, while also decreasing overall customer acquisition cost by about 10% sequentially.

The Hong Kong market stands out as a significant growth engine. Client assets in Hong Kong experienced approximately 50% quarter-over-quarter growth in Q2 2025, and new funded accounts from Hong Kong in Q3 2025 year-to-date have nearly matched those from Singapore. This accelerated expansion in Hong Kong, including increased marketing activities and offline events, has led to tangible results in user quality and client assets. Hong Kong's average client asset of around $20,000 and ARPU double the group average underscore its strategic importance. The company's 2B business also maintained strong momentum, underwriting 7 Hong Kong IPOs and 4 U.S. IPOs in Q2 2025, boosting other revenue to a new quarterly high. The ESOP business added 30 new clients in Q2 2025, bringing the total to 663, a 15% year-over-year increase.

Outlook and Guidance: Charting the Future

Management's guidance for 2025 reflects a strategic pivot towards qualitative growth and enhanced profitability. The company targets acquiring at least 150,000 new funded accounts in 2025, maintaining the same level as 2024 but with a strong emphasis on user quality and return on investment. This involves expanding efforts to attract high-net-worth individuals, particularly in high-value markets like Hong Kong, where a higher Customer Acquisition Cost (CAC) of around $400+ is deemed acceptable due to a healthy payback period of approximately two quarters. Overall, the average CAC is projected to rise to $250-$300 in the coming quarters, reflecting increased investment in brand awareness and high-value markets.

Looking ahead to Q3 2025, the company anticipates a high single-digit increase in client assets compared to the end of Q2 2025, primarily driven by mark-to-market gains and robust net asset inflows from retail clients. Trading activity and commission revenue are expected to remain on target, with the average monthly number of shares traded in the past two months of Q3 2025 exceeding the Q2 monthly average. The company plans disciplined headcount growth, with compensation expenses expected to increase by 10% to 20% annually, supporting continued investment in product development, R&D, and team expansion in key overseas offices.

Potential Federal Reserve interest rate cuts pose a quantifiable impact on net interest income. Management estimates that every 25 basis point cut by the Federal Reserve could negatively impact quarterly net interest income by $1 million to $1.5 million, representing approximately 1% of quarterly revenue. Despite these potential headwinds, the company's diversified revenue streams and strategic focus on high-quality assets are expected to mitigate the impact.

Risks and Challenges

While Tiger Brokers demonstrates strong growth, several risks warrant investor attention. Regulatory risks, particularly in the dynamic Chinese market, remain a pertinent concern. Changes in regulations could impact business operations, customer acquisition, and financial performance. The company's expansion into virtual asset trading, while promising, also exposes it to evolving regulatory frameworks and the inherent volatility of the cryptocurrency market.

Market volatility, while sometimes driving trading volume, can also introduce uncertainty and impact client asset valuations, potentially affecting commission and interest income. Intense competition in the online brokerage space, particularly from well-capitalized global players and local fintechs, necessitates continuous innovation and efficient customer acquisition strategies. While Tiger Brokers has built strong barriers through its technology and niche focus, maintaining its competitive edge requires ongoing investment and strategic adaptability.

Conclusion

UP Fintech Holding Limited ($TIGR) is demonstrating a powerful growth narrative, underpinned by record financial performance, strategic expansion into high-value markets, and a relentless focus on technological innovation. The company's ability to achieve record revenues and profitability, coupled with its disciplined approach to user acquisition, highlights a maturing and increasingly stable business model. Its pioneering efforts in integrating AI through TigerAI and its aggressive expansion into the digital asset space position it at the forefront of financial technology, creating a compelling bridge between traditional and Web3 finance.

The strong performance in Hong Kong, characterized by high-quality users and significant asset growth, underscores the success of its targeted market penetration strategy. While facing inherent risks from regulatory changes and market volatility, Tiger Brokers' robust operational leverage, diversified revenue streams, and commitment to technological leadership provide a solid foundation for continued growth. For discerning investors, Tiger Brokers presents an opportunity to participate in the evolution of global online brokerage, driven by digital innovation and strategic market capture.