Futu Holdings Ltd

Futu Holdings delivered a deeply disappointing Q1 2026 report, with earnings of $0.77 per share missing the $28.58 consensus estimate by 97.31% and revenue of $746.94 million falling 88.03% short of the $6.24 billion Wall Street had projected, sending shares tumbling nearly 28% as investors digested the news. The culprit was a proposed regulatory penalty from China's Securities Regulatory Commission totaling approximately $1.85 billion, covering confiscated gains and fines for allegedly conducting regulated business without proper licenses, a charge that swung the "Others, net" line to negative $2.13 billion and dragged GAAP net income down 61.2% year-over-year. Beneath that regulatory overhang, operating fundamentals were notably firm, with funded accounts climbing 34.3% to 3.59 million and total client assets reaching $1.22 trillion. Management reaffirmed its full-year guidance of 800 thousand net new funded accounts, insisting the penalty does not impair business fundamentals, though the proposed charges remain subject to further proceedings and the company retains the right to contest them.