Qudian Inc.'s Q3 2025 Performance and Strategic Turnaround Potential

Qudian Inc. (now rebranding as High Templar Tech Limited) has navigated a complex landscape in 2025, marked by operational restructuring, cost optimization, and a strategic pivot in China's evolving consumer finance sector. The company's third-quarter 2025 results underscore both the challenges of its business transition and the potential for long-term value creation. This analysis evaluates Qudian's operational recovery, cost restructuring efforts, and market repositioning against the backdrop of a cautiously expanding consumer finance sector in China.

Operational Recovery: A Tale of Two Businesses

Qudian's Q3 2025 unaudited financial results reveal a stark dichotomy. While net income attributable to shareholders surged to RMB409.9 million (US$57.6 million)-a 211% year-over-year increase-total revenues plummeted by 84.5% to RMB8.5 million (US$1.2 million). This divergence stems from the company's deliberate wind-down of its last-mile delivery business, which accounted for the bulk of its prior revenue. By shifting focus to a technology-driven consumer finance model, Qudian has prioritized profitability over short-term revenue, a strategy that aligns with broader sector trends.

The company's cash reserves, however, remain robust. As of September 30, 2025, Qudian held RMB7,010.6 million (US$948.8 million) in cash and cash equivalents, with an additional RMB1,518.7 million (US$213.3 million) in restricted cash according to the financial results. This liquidity positions the firm to fund its strategic initiatives while maintaining financial flexibility.

Cost Restructuring: Efficiency Amid Transition

Qudian's cost restructuring efforts have been pivotal to its profitability. Operating costs and expenses declined by 2.3% year-over-year, driven by an 86.6% drop in cost of revenues due to reduced service costs from the last-mile delivery business. However, general and administrative (G&A) expenses rose by 41.1%, primarily from higher depreciation and property tax expenses following the completion of its headquarters construction as reported in Q3 results. This increase highlights the trade-off between long-term infrastructure investments and short-term cost discipline.

The company's R&D expenses also fell by 23.8%, attributed to reduced staff headcount. While this may raise concerns about innovation, Qudian has emphasized leveraging existing technology capabilities to explore new business opportunities. This approach suggests a focus on cost efficiency rather than aggressive R&D spending.

Market Repositioning: Rebranding and Shareholder Confidence

Qudian's rebranding to High Templar Tech Limited, with a ticker symbol change to "HTT," signals a strategic shift toward a technology-centric identity. This move, pending shareholder approval at an extraordinary general meeting on December 10, 2025, reflects the company's intent to distance itself from its logistics past and reposition in the consumer finance sector.

Shareholder confidence has been bolstered by a significant repurchase program. From June 13, 2024, to November 18, 2025, Qudian spent US$765.3 million to repurchase 180.6 million ADSs. Such aggressive buybacks indicate management's belief in the company's intrinsic value and its long-term growth potential.

Broader Sector Context: Navigating Regulatory and Competitive Shifts

China's consumer finance sector in 2025 is characterized by cautious optimism. Internet platforms like Ant Group and WeBank have resumed lending operations under a more stable regulatory environment, with Beijing introducing interest subsidies to stimulate borrowing. UBS forecasts online consumer lending to grow by 7.6% in 2025, reaching 5.4 trillion yuan, though rising defaults due to economic pressures pose risks.

Qudian's repositioning must contend with these dynamics. The sector's shift toward "normalised regulatory oversight" allows for growth but remains contingent on default management. Additionally, application security has emerged as a critical factor, with digital transformation driving demand for advanced security solutions in financial services. While Qudian has not explicitly detailed its security innovations, its focus on technology capabilities suggests it is aligning with these trends.

Strategic Turnaround Potential: Risks and Opportunities

Qudian's turnaround hinges on its ability to capitalize on its cash reserves and rebranding while addressing sector-specific challenges. The company's exploration of "innovative business opportunities" as highlighted in the security market report remains vague, but its strong balance sheet provides flexibility to pursue partnerships or acquisitions in the consumer finance space.

However, the absence of concrete details on new business models or partnerships raises questions about execution risk. The company's success will depend on its capacity to leverage its technology expertise in a sector increasingly dominated by fintech giants and state-backed players.

Conclusion

Qudian's Q3 2025 results reflect a company in transition, balancing operational recovery with strategic repositioning. While its cost restructuring and liquidity position are strengths, the lack of clear innovation in consumer finance and the competitive pressures of the sector present challenges. The rebranding to High Templar Tech Limited and aggressive share repurchases signal confidence, but investors must monitor the company's ability to translate its technology capabilities into sustainable revenue streams. In a sector poised for cautious growth, Qudian's turnaround potential remains contingent on its execution of a clear, differentiated strategy.