Noah Holdings Q1 2025: Navigating Contradictions in Tax Impact, Market Volatility, and Growth Strategy

Impact of tax bureau notices on investment sentiment, market volatility impact on clients' investment behavior, issues with product roadmap execution and supply chain are the key contradictions discussed in Noah Holdings Limited's latest 2025Q1 earnings call



Overseas Market Performance:
- Noah's overseas net revenues were RMB 304 million in Q1, up 5% sequentially but flat year-on-year, comprising 49.5% of the group's total revenue.
- Growth was driven by an increase in overseas investment products by 20.3% and the expansion of the overseas relationship management team, which increased by 44% from the previous year.

Domestic Market Challenges:
- Net revenues from Mainland China were RMB 310 million, down 9.4% year-on-year and 14.3% sequentially.
- This decline was attributed to lower recurring service fees from private equity products and reduced distributions of domestic insurance products.

Financial Management and Shareholder Returns:
- Noah distributed RMB 550 million in annual and special dividends, representing 100% of its non-GAAP net income for 2024, offering a 12% dividend yield.
- The company has distributed a total of RMB 1.8 billion in dividends over the past 3 years, equivalent to approximately 40% of its current market cap, reflecting its commitment to shareholder returns.

Operating Expense Reduction:
- Total operating costs and expenses decreased by 18.8% year-over-year and 16.7% sequentially.
- This reduction was achieved through simplifying the back office structure, which reduced compensation benefits by 21.8% and selling expenses by 18.1% year-over-year.