FRHC earnings analysis
What we found in FRHC's 10-Q: the parts that mattered, the offsets in the same document, and what the company said about what comes next.
Our reading of the filing · Free to read, no account needed
Freedom Holding delivered strong top-line growth, with revenue up 40% year over year to $732.5 million, led by Brokerage revenue growth of 60% and Other-segment growth of 100%. Profitability weakened, however, as net income declined 15% to $31.7 million and operating cash flow shifted to a $341.6 million outflow amid 45% expense growth. Higher cash and financing proceeds improved near-term liquidity, but insurance losses, margin concentration, substantial expansion funding needs and the SEC Wells Notice remain material concerns.
The parts that mattered.
Pulled out of the filing itself, with the figures the company reported.
- Revenue growth accelerated
- Total revenue, net increased 40% year over year to $732.5 million from $524.0 million. Growth was led by interest income of $295.1 million, up 49%, and fee and commission income of $156.7 million, up 46%.
- Brokerage led segment growth
- Brokerage revenue rose 60% to $282.6 million, supported by brokerage-service fees of $164.3 million, up 60%, and retail brokerage customers increasing to 874,000 from 725,000 year over year.
- Telecom and commerce expanded
- Other-segment revenue doubled to $73.9 million, driven by a $24.3 million increase in sales of goods and services tied to telecommunications expansion and higher Arbuz activity.
- Liquidity and assets increased
- Cash and cash equivalents increased to $1.35 billion from $966.1 million at March 31, 2026, while total assets increased to $14.05 billion from $13.16 billion.
- Credit ratings improved
- S&P raised the long-term issuer credit ratings of Freedom KZ, Freedom EU, Freedom Global and Freedom Bank KZ to BB- from B+ on June 24, 2026, citing a three-year track record of consolidated risk management and compliance.
- Financing offset cash outflow
- Net cash from financing activities was $1.22 billion, including $475.2 million of bank deposits, $300.0 million of private-placement equity proceeds and $210.0 million of net debt issuance proceeds.
And the other side of it.
The offsets in the same document — the things a summary that only listed the good news would have left out.
- Expense growth pressured earnings
- Net income declined 15% to $31.7 million from $37.4 million despite 40% revenue growth. Total expenses increased 45% to $691.7 million, including payroll and bonuses up 66% to $153.1 million and general and administrative expense up 82% to $76.2 million.
- Negative operating cash flow
- Operating cash flow turned negative at $341.6 million used, versus $480.8 million generated in the prior-year quarter. The outflow included a $548.7 million increase in trading securities and a $508.2 million decrease in brokerage customer liabilities.
- Insurance profitability deteriorated
- Insurance revenue fell 14% to $124.2 million, while insurance claims and policyholder benefits increased 102% to $131.6 million. Written premiums were $170.0 million, down 1%, and deferred profit liability issuance expense increased 457% to $38.9 million.
- Margin concentration risk
- The Company had $3.94 billion of margin lending receivables, with $2.98 billion attributable to three non-related-party customers. Management states that exposure from margin lending and customer short sales can be unlimited and not quantifiable.
- Expansion requires substantial funding
- Management expects Freedom Telecom capital expenditures to be significant, but the amount is currently uncertain; related capital-expenditure commitments were up to $113.1 million as of June 30, 2026. The proposed Sovereign AI Hub also has a potential project cost of $2 billion and would require significant financing.
- SEC regulatory investigation
- The Company and CEO Timur Turlov received a Wells Notice from SEC staff on March 11, 2026, in connection with an SEC investigation. The filing states that regulatory actions could materially adversely affect reputation, business, financial condition, results of operations, prospects and cash flows; management reported no material changes to the 2026 Form 10-K risk factors as of June 30, 2026.
What they reported.
What the company itself reported, taken out of the document.
- Segment
- Brokerage: revenue $282.6 million, up 60% year over year; expenses $115.1 million, up 34%.
- Segment
- Banking: revenue $225.2 million, up 54% year over year; expenses $219.3 million, up 74%.
- Segment
- Insurance: revenue $150.9 million, down 8% year over year; expenses $168.7 million, up 9%.
- Segment
- Other: revenue $73.9 million, up 100% year over year; expenses $188.6 million, up 73%.
What they said about what is next.
No numeric revenue or EPS guidance was provided. Management stated that Freedom Telecom capital expenditures are expected to be significant but the specific amount is currently uncertain; capital expenditure commitments were up to $113.1 million as of June 30, 2026.
The filing reads about the same as the one before it.
What came before.
- 10-Q · November 7, 2025
- FRHC reported quarterly revenue of $526,107,000 and diluted EPS of $0.63 for the three months ended September 30, 2025. Revenue and profitability declined versus the prior-year quarter (revenue down $60,032,000; diluted…
- 10-Q · August 8, 2025
- Freedom Holding Corp. reported quarterly revenue of $533,423 (in thousands) for the three months ended June 30, 2025, up from $454,999 (in thousands) a year earlier, driven by higher interest income and insurance…
- 10-Q · November 8, 2024
- FRHC reported quarterly revenue of $580,900,000 for the three months ended September 30, 2024, up from $435,581,000 a year earlier (+33.4%), driven largely by higher insurance underwriting income. Income before tax fell…
- 10-Q · August 9, 2024
- Q2 results show strong revenue expansion to $450,715 (thousands) driven by higher interest and insurance underwriting income, but profitability declined: pre-tax income fell to $41,598 (thousands) and diluted EPS to…
This is our reading of a public filing, not the filing. Read the original on SEC.gov · Educational only. Nothing here is investment advice.
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