Freedom Holding 2026 Q2 Earnings Sharp Net Income Drop of 66.2%

Freedom Holding (FRHC) reported its fiscal 2026 Q2 earnings on Nov 7, 2025, with results significantly below expectations. Total revenue fell 5.4% year-over-year to $277.46 million, while net income plummeted 66.2% to $38.72 million. The company provided no forward guidance, and analysts noted the earnings missed key metrics.

Revenue

Freedom Holding’s total revenue declined by 5.4% to $277.46 million in Q2 2026, down from $293.42 million in the prior year. The drop reflects weaker performance across core operations, though specific segment details were not disclosed.

Earnings/Net Income

The company’s net income fell sharply to $38.72 million, a 66.2% decline from $114.49 million in 2025 Q2. Earnings per share (EPS) also dropped 66.3% to $0.65. This significant contraction in profitability underscores operational challenges and highlights the need for strategic adjustments.

Price Action

The stock price of Freedom Holding rose 4.86% on the latest trading day but fell 7.67% for the week and 16.19% month-to-date. Post-earnings volatility reflects mixed investor sentiment.

Post-Earnings Price Action Review

The strategy of buying Freedom Holding shares on the date of its earnings announcement and holding for 30 days has shown poor performance over the past three years. The 30-day return aligns closely with the 1-month return, indicating no immediate price advantage. This approach underperforms compared to a simple buy-and-hold strategy, as the holding period captures only a fraction of total returns. The lack of outperformance suggests limited value in timing trades around earnings.

CEO Commentary

Timur Turlov, CEO, emphasized strategic investments in technology and infrastructure during the earnings call, stating, “We build for the future, reinvesting every dollar into innovations that strengthen our ecosystem.” Despite the earnings decline, he highlighted long-term growth initiatives, including the expansion of digital services and cross-border partnerships. The tone remained cautiously optimistic, focusing on resilience and future scalability.

Guidance

Freedom Holding did not provide explicit forward-looking guidance for 2026 Q3 or beyond. However, management reiterated a focus on “disciplined spending to build operational backbones” for future efficiency and profitability.

Additional News

1. $2B Sovereign AI Hub in Kazakhstan: Freedom Holding partnered with the Kazakh government and NVIDIA to develop a $2 billion AI hub, leveraging exascale technology to boost regional AI capabilities.

2. BlackRock Investment: BlackRock became the second-largest shareholder, acquiring a 0.85% stake worth $89 million.

3. China-Kazakhstan E-Commerce Expansion: Freedom Bank and UnionPay Business launched a cross-border settlement system to enhance trade between the two nations.

Financial Health

Freedom Holding’s 1H FY2026 results showed $1.06 billion in revenue and $69.1 million in net income, reflecting stable liquidity. However, the Altman Z-Score of 1.4 and Beneish M-Score of -1.18 raise concerns about financial stability and potential manipulation.

Strategic Moves

The company’s $2 billion AI hub in Kazakhstan, powered by NVIDIA, signals a pivot toward technology-driven growth. This initiative aligns with its broader digital ecosystem strategy, including telecom and fintech expansions.

Analyst Outlook

Weiss Ratings reaffirmed a “Hold” rating, citing mixed performance. Institutional investors, including Strs Ohio and the Public Employees Retirement System of Ohio, increased stakes, reflecting cautious optimism about long-term potential.

Conclusion

While Freedom Holding’s Q2 2026 results were disappointing, the company’s strategic bets on AI and cross-border partnerships may drive future growth. Investors are advised to monitor the AI hub’s progress and management’s ability to execute cost discipline. The stock’s volatility underscores the need for a long-term perspective amid near-term challenges.