Gentlemen, welcome to Futu Holdings second quarter 2026 earnings conference call. At this time, all participants are in a listen-only mode. After management's prepared remarks, there will be a question- and- answer session. Today's conference is being recorded. If you have any objections, you may disconnect at this time. I would now like to turn the conference over to your host for today's conference call, Michelle Li, Investor Relations Manager at Futu. Ma'am, please go ahead. Thanks, operator. Thank you for joining us today to discuss our second quarter 2026 earnings results. Joining me on the call today are Mr. Leaf Li, Chairman and Chief Executive Officer, Arthur Chen, Chief Financial Officer, and Robin Xu, Senior Vice President. As a reminder, today's call may include forward-looking statements, which represent the company's belief regarding future events, which, by their nature, are not certain and are outside of the company's control. Forward-looking statements involve inherent risks and uncertainties. We caution you that a number of important factors could cause actual results to differ materially from those contained in any forward-looking statements. For more information about the potential risks and uncertainties, please refer to the company's filings with the SEC, including its annual report. With that, I will now turn the call over to Leaf. Leaf will make his comments in Chinese and I will translate. [Non-English content] Thank you all for joining our earnings call today. In the second quarter, we acquired 252,000 net new funded accounts, up 23.7% year-over-year and 12.2% quarter-over-quarter. Total funded accounts reached approximately 3.84 million, representing an increase of 33.6% year-over-year and 7% quarter-over-quarter. Client acquisition in Hong Kong accelerated sequentially during the quarter, supported by a robust local IPO pipeline and strong performance in U.S. equities. In Singapore, registered users surpassed the 2 million milestone, further solidifying our leadership among local retail investors. The average revenue per new client in both markets improved sequentially, underpinned by our ongoing investor education initiatives across multiple asset classes, reinforced by our sustained investment in brand equity. In Malaysia, our targeted marketing campaigns centered around local IPOs and the AI-driven rally catalyzed a record quarter of client acquisitions, leading all markets in net new funded accounts for the third consecutive quarter. In the U.S., Moomoo's Prediction Markets garnered significant traction, driving incremental new client acquisition and helping improve overall client engagement on our platform. As of quarter end, total client assets stood at HKD 1.4 trillion, up 43.6% year-over-year and 14.5% quarter-over-quarter. The growth was mainly attributable to higher market valuation of client stock holdings and, to a lesser extent, net asset inflow. Period end margin financing and securities lending balance rose 31% quarter-over-quarter to HKD 95.1 billion, supported by an active Hong Kong IPO market, along with broader positive market sentiment that encouraged clients to take on more leverage. Thanks to favorable market conditions, total trading volume rose 78.8% year-over-year and 54.6% quarter-over-quarter to HKD 6.42 trillion, setting a new record high. U.S. stock trading volume grew 67.2% sequentially to HKD 5.02 trillion, driven by client interest in AI-related names. Hong Kong stock trading volume increased by 15.9% quarter-over-quarter to HKD 1.17 trillion, largely attributable to heightened trading activity in semiconductor, China internet, and newly listed companies. [Non-English content] In June, Futu Securities became the first and to date only broker in Hong Kong to launch securities-backed margin financing for virtual assets under an upgraded Type 1 license approval from the SFC. We are also exploring extending our unified buying power framework to cover virtual asset holdings, further enhancing capital efficiency across traditional and digital asset markets. [Non-English content] Wealth management client assets were HKD 180.2 billion, up 10% year-over-year and 1% quarter-over-quarter. During the quarter, we observed a shift in client preference from money market funds towards equity funds on the back of strong equity market performance. In Hong Kong, we held our first offline fund roadshow for retail investors centered on the commercial space theme. Amid heightened investor interest, the event drew a full onsite audience and several hundred livestream participants, translating into meaningful follow-on subscriptions. [Non-English content] We concluded the quarter with 683 IPO distribution and IR clients, up 32% year-over-year. The Hong Kong IPO market sustained strong momentum in the second quarter, with nearly 60% of newly listed companies choosing to partner with Futu. We served as joint bookrunners for multiple high-profile listings, including those of Star Sports Medicine, Lightelligence, and Metis TechBio. [Non-English content] Next, I'd like to invite our CFO, Arthur, to discuss our financial performance. Thank you, Leaf and Michelle. Please allow me to walk you through our financial performance in the second quarter. All the numbers are in HKD, unless otherwise noted. Total revenue was HKD 7.2 billion, up 36% from HKD 5.3 billion in the second quarter of 2025. Brokerage commission and handling charge income was HKD 3.4 billion, up 30% year-over-year and 27% Q-over-Q. Total trading volume grew on both year-over-year and a Q-over-Q basis, while blended commission rate declined due to stronger trading activities in higher priced U.S. stocks and options during the quarter. Interest income was HKD 3.1 billion, up 37% year-over-year, and 18% Q-over-Q. Both the year-over-year and the Q-over-Q increase was mainly driven by high interest income from margin financing, bank deposits, and secured lending. Other income was HKD 718 million, up 61% year-over-year and 27% Q-over-Q. Both year-over-year and the Q-over-Q increase was primarily driven by higher currency exchange income and IPO financing service income. Our total costs were HKD 985 million, up 47% compared to the second quarter of 2025. Brokerage commission and handling charge expenses were HKD 248 million, up 54% year-over-year and 50% Q-over-Q. Both the year-over-year and the Q-over-Q increase was mainly due to higher trading volume. Interest expenses were HKD 513 million, up 36% year-over-year, and 24% Q-over-Q. Both the year-over-year and the Q-over-Q increase was mainly driven by higher interest expenses associated with our margin financing business. Processing and servicing costs were HKD 225 million, up 70% year-over-year and 32% Q-over-Q. Both the year-over-year and the Q-over-Q increase were primarily driven by higher product service fees. As a result, total gross profit was HKD 6.2 billion, an increase of 34% from HKD 4.6 billion in the second quarter of 2025. Gross margin was 86.3% as compared to 87.4% in the same quarter of 2025. Operating expenses were HKD 1.8 billion, up 35% year-over-year and 11% Q-over-Q. To break it down, R&D expenses were HKD 501 million, up 13% year-over-year and 5% Q-over-Q. The year-over-year and the Q-over-Q increase was primarily driven by the increased investments in strategic initiatives like AI and Web3. Selling and marketing expenses were HKD 657 million, up 53% year-over-year and 18% Q-over-Q. The year-over-year and the Q-over-Q increase was mainly driven by the increase of new fund accounts. G&A expenses was HKD 593 million, up 40% year-over-year and 10% Q-over-Q. The year-over-year increase was primarily due to an increase in G&A personnel and the professional fees. As a result, income from operations was HKD 4.5 billion, up 34% year-over-year and 26% Q-over-Q. Operating margin of 62% is largely flat compared to the second quarter of 2025. Our net income increased by 42% year-over-year to HKD 3.6 billion. Net income margin expanded to 50.6% in the second quarter, compared to 48.4% in the same quarter last year. Our effective tax rate for this quarter was 16.1%. That concludes our prepared remarks. We'd now like to open the call to questions. Operator, please go ahead. Thank you. As a reminder, to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. We ask that you please limit yourself to one question and one follow-up. One moment while we compile our Q&A roster. Our first question is going to come from the line of Emma Xu with BofA Securities. Your line is open. Please go ahead. [Non-English content] Thank you for giving me the opportunity to ask the first question. Congratulations on the strong second quarter results. Since the release of the new regulations on May 22nd, have you seen material changes in Mainland client share across funded accounts, AUM, and revenue contribution? Have you observed meaningful outflow of accounts or client assets? The second question is, against the regulatory backdrop, the group delivered resilient revenue and profit in the second quarter. Could management please share an update of the overseas market development and their contribution to the group? Thank you. [Non-English content] I will translate for Leaf. Futu highly emphasizes compliance and strictly implements all regulatory requirements. After the new regulations were issued on May 22nd, we promptly implemented the relevant compliance measures and maintained ongoing communication with the regulators. As for the cumulative asset outflows since the new regulations, the outflows were about mid-single digit percentage of our total client assets. We believe the bulk of the impact has already been absorbed in Q2. The outflows came from both our Mainland and Hong Kong client base, and the two are roughly about the same. The Mainland outflows were primarily compliance-driven adjustments under the new rules, while the Hong Kong outflows were more concentrated in the early period right after the announcement, which reflects some risk-off sentiment as the market digested the news. Most of the Mainland client outflows happened in June and July after we implemented the restrictions on our app. The pace of client attrition started to moderate in August. For Q2, our Hong Kong client retention rate stayed above 98%, the retention across our overseas market remained stable quarter-over-quarter. We continue to see steady growth in overseas new client additions. Going forward, we will keep directing our resources and the growth focus towards advancing our international business. [Non-English content] On the quality of new fund accounts, the average revenue per newly fund accounts improved sequentially across multiple markets in the overseas. In particular, U.S., Singapore, and Hong Kong all posted double-digit growth. We think this both reflects a structural upshift in fund account quality in growing markets like U.S. and also continued acquisitions of higher value clients in mature markets like Hong Kong and Singapore, together supporting overall revenue growth. On the client asset perspective, all fund accounts in overseas markets, including Malaysia, Australia, New Zealand, and Canada, grew double digits sequentially in second quarter. Actually, the average client assets rose Q-over-Q across every overseas market we have the operations, showing that we are growing not just in the number of clients, but also the wallet share. Our recent securitizations of the Thailand license also give us a very additional important anchor for our ASEAN footprint down the road. In terms of profitability, our overseas markets are at different stage of maturities. For instance, Singapore has already passed the break even a couple of years ago. The absolute level and also the net profit margin continue to expand, thanks to the operating leverage benefit kicking. I am also very happy to share, Malaysia has recently achieved the break even in the operation levels as well. While our other overseas markets are still building out their client and asset base of the rising average clients assets and the client retentions, we think the groundwork for our long term profitability for the overseas markets will be very likely. Thank you. Thank you. They are very helpful. Thank you. One moment for our next question. Our next question will come from the line of Chiyao Huang with Morgan Stanley. Your line is open. Please go ahead. [Non-English content] Let me briefly translate. The first question is regarding Thailand. What is the strategic thinking about choosing this market? When do we expect Futu to officially launch the business here? Do we see any synergy in the ASEAN market we are already in? The second question is about the commission rate, which is dropping a little bit Q on Q. What kind of structural changes are we seeing behind this drop? Thank you. [Non-English content] [Non-English content] I will translate. Thailand is the third largest economy in Southeast Asia. The local investors there are quite digitally savvy with growing demand for global asset allocation as well as digital investing tools. According to the Stock Exchange of Thailand, as of the first half of 2026, over 45 million investors had opened accounts online. For Moomoo, entering Thailand is really a natural next step in the Southeast Asia market after Singapore and Malaysia. It allows us to leverage the infrastructure and the operations that we have already built in that region. Moomoo has already obtained the Type A securities license from the Thai SEC. Combined with our licensed operations in other overseas markets, this reflects the ongoing recognition from regulators of our ability to operate compliantly across multiple jurisdictions. The overall pace of our overseas expansion remains steady. As for the timing of the official launch, we still need to go through the regulators' readiness inspection to receive final approval. We do not really have a specific timeline to share at this point. We will continue to work closely with the local regulator and make sure all the pre-launch preparations are thoroughly in place. [Non-English content] First, there was no any price manual change in the second quarter across all of our markets. So the take rate change Q on Q is mainly driven by our customers' behavior. Number one is the contribution from the derivative in the second quarter compared with the first quarter slightly down Q- over- Q. But on the absolute levels, the contribution is still very healthy. Secondly is more clients are trading the US stocks in the second quarter with a very high concentration on some high-value AI themes and tech leading names, which let our implied commission rate down a little bit. Thank you. Thank you. One moment for our next question. Our next question is going to come from the line of Charles Zhou with UBS. Your line is open. Please go ahead. [Non-English content] First of all, congrats to the management on the very excellent results and also strong beat to the market consensus. This is Charles Zhou from UBS. I have two questions. First, can we maybe get some colors on the trajectory of your CAC in the second quarter? What the key drivers were if we think about the CAC in the coming quarters? My second question is also could you maybe provide some breakdown on the newly added funded accounts and the period and funded accounts by markets, in particular, the contribution mix from your overseas markets. Thank you. [Non-English content] [Non-English content] In the second quarter, the blended CAC rose sequentially to around HKD 2,600, which is still within our full year guidance range of HKD 2,500- HKD 3,000. The quarter-on-quarter increase in CAC for Q2 was mainly driven by the relatively lower net new funded accounts as a result of the regulatory development. At the same time, we maintain a certain level of brand investment to support the long-term growth and the higher client lifetime value across our markets. Additionally, the CAC trended higher in July relative to Q2. [Non-English content] Malaysia has led all markets in terms of new funded accounts growth for three consecutive quarters, followed by Hong Kong. Together, these two markets make up for more than 50% of net new funded accounts acquired in this quarter, with Singapore being the next largest source among the remaining markets. By the end of the second quarter, Moomoo's share of total funded accounts has increased to nearly 60%, led by Singapore, Malaysia and the U.S. Thank you. Thank you. One moment for our next question. Our last question is going to come from the line of You Fan with CICC. Your line is open. Please go ahead. [Non-English content] Thanks for taking my questions and congratulations on the outstanding results. This is You Fan from CICC and I have two questions here. Firstly, would you please share more color on our Q3 trend such as the run rate of the new funded accounts, the trade flow and also the client AUM? Secondly, since Moomoo has launched the Prediction Markets in the U.S., can you share more on this business trend and how to view the future monetization and growth opportunities of Prediction Markets? These are two questions. Thank you. [Non-English content] [Non-English content] On the Q3 quarter to date run rate basis, our key metrics are trending modestly softer against a backdrop of market volatility. The net addition of funded accounts moderated compared with Q2. As for net asset inflow in Hong Kong and our overseas markets, net asset inflows have returned to a normalized level. As for the trading volume, total trading volume was down modestly sequentially. This is primarily reflecting a cooling of the retail sentiment in the Q3 quarter to date relative to the previous quarter. [Non-English content] We got the license in May, FCM license from CFTC and Moomoo US officially launched the prediction market trading service for our retail clients in the US in early June. The number of the event contracts as Leaf mentioned in opening remarks, trade exceeds 200 million within one month of the launch, reflecting a very strong demand from the U.S. retail investors for Prediction Markets products. The event contracts has delivered great results, in our observation, in both acquiring new clients and driving engagement with clear cross-sell synergy with our core brokerage business. For instance, users who trade event contracts are more active in security trading, showing that event contracts are not substitute for security trading, but rather a drive of it. The purpose for our U.S. Prediction Market rollout, I think serves two purposes. Number one is definitely to capture the near-term opportunity as Prediction Markets took off locally. More importantly, it let us build up the product design, operational, and the risk management expertise that will support our ability to bring Prediction Markets to other regions we have the operation down the road. Thank you. [Non-English content] Thank you. Thank you. I would now like to hand the conference back over to Michelle Li for closing remarks. That concludes our call today. On behalf of the Futu management team, I would like to thank you all for joining us today. If you have any further questions, please do not hesitate to contact me or any of our investor relations representative. Thank you and goodbye. This concludes today's conference call. Thank you for participating, and you may now disconnect. Everyone, have a great day.