Freedom Holding Corp.
For the period ended Jun 30, 2025. Filed Aug 8, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2025 · Filed Aug 8, 2025
FRHC$178.85+0.9%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-12-31; filed 2025-02-07.
0000924805-25-000002
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-06-30; filed 2025-08-08.
0000924805-25-000031
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 314 previous paragraphs and 236 current paragraphs.
114 unchanged; 75 reworded; 46 added; 103 removed; 22 previous and 1 current paragraphs rearranged.
Tables are not compared: 36 previous and 20 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (46)
Current report
•сhanges in U.S. trade policies or other countries trade policies, including the imposition of tariffs and retaliatory tariffs;
Current report
Our mission has always been to democratize access to financial markets for global customers. Our company was founded to provide access to the international capital markets for retail brokerage customers and has rapidly grown providing a world-class digital infrastructure that has led to innovative, integrated financial technologies that address customer needs in Kazakhstan, our home market, and dozens of other countries across Europe, Asia, and North America.
Current report
During the first quarter of fiscal 2026, the Company's common stock was included in the Russell 3000® Index as part of its 2025 annual reconstitution. Management believes that index membership may raise our profile among institutional investors and could improve the liquidity of our common stock; however, we cannot predict the magnitude or duration of any resulting impact on market price or trading volume.
Current report
FCM is a registered agency-only execution broker-dealer on the floor of the New York Stock Exchange ("NYSE"). FCM is a member of Nasdaq, NYSE and FINRA, as well as SIPC (Securities Investor Protection Corporation) insured. FCM provides a full range of broker-dealer services, including research, sales and trading services for institutional accounts, investment banking services and independent investment research through research reports, recommendations and investment ideas to assist customers in making informed decisions.
Current report
Freedom Bank KZ is a pioneer in digital retail and commercial banking services in Kazakhstan, offering deposits, multi‑currency payment cards, consumer and SME loans, payment and acquiring solutions. The bank extends our capital market heritage into everyday finance, providing the funding, payments and credit backbone of the wider Freedom ecosystem. Our Freedom Bank TJ obtained its banking license on October 15, 2024.
Current report
Digital Fintech Ecosystem
Current report
We operate as a single ecosystem that delivers multicurrency banking, payments, credit, brokerage, insurance, merchant acquiring and selected lifestyle services through one login and interface. Each service is built to interoperate with the others - balances transfer instantly, loyalty rewards accrue across products and customer data is captured only once, so the combined offering is more useful to customers and more efficient for us.
Current report
Our operating entities share customer transaction flows, interactions and profile updates to big data that is also enriched by our integration with government services. Predictive AI models built on this consolidated record set help us personalize our products and services reaching the combined effect of smarter targeting, faster fulfillment and fewer manual touch‑points which lowers acquisition cost and raises both customer lifetime value and retention.
Current report
The Freedom SuperApp is the Group’s front end for all retail and SME (small and medium-sized enterprises) services. A single sign‑on process and biometric authentication grant access to multi‑currency accounts, credit, investment, card management and lifestyle commerce. All modules are built on a micro‑services architecture with open APIs (Application Programming Interface) to over thirty government and commercial data sources.
Current report
Freedom SuperApp supports accounts and payments in KZT, multiple foreign currencies and Freedom Currency, an exchange‑traded note linked to the performance of FRHC common stock. Our app provides our customers with a generous loyalty program, access to a lifestyle marketplace including ticketing (cinema, concerts), travel bookings (Freedom Travel), grocery delivery (Arbuz) and on‑demand home services (Naimi), and integrates customer wealth information into a real‑time net‑worth view generating secured‑loan offers where collateral is available. All our core lending lines operate on the same end‑to‑end digital rail inside the SuperApp enabling our eligible customers to obtain digital mortgage loans, consumer digital auto loans, and SME digital loans in a streamlined, automated way.
Current report
Freedom Bank issues a vertically integrated suite of Visa and Mastercard products, all of which are opened, funded, and managed within the SuperApp, with some cards also customizable based on customer preferences. By using our cards, customers gain access to a range of services, including multi-currency debit balances (SuperCard), revolving and installment credit options (Freepay Card), investment opportunities through brokerage accounts (Invest Card), and enhanced service levels with exclusive benefits (Premium Deposit Cards). Freedom Business extends SuperApp to legal entities, offering mobile access to current accounts, foreign exchange, QR invoicing, advanced acquiring, sales and credit features, as well as payroll and tax payment services.
Current report
Our digital fintech platform leverages cutting-edge technology, big-data analytics, and robust security and compliance, powered by our proprietary scoring models, real-time fraud and sanctions screening, and machine-learning algorithms that analyze balance trends and purchase histories to personalize product recommendations and boost customer loyalty.
Current report
On June 26, 2025, S&P Global Ratings revised its outlook to positive from stable and affirmed its 'B+/B' long- and short-term issuer credit ratings on Freedom KZ, Freedom EU, Freedom Global, and Freedom Bank KZ. S&P affirmed 'B-' long-term rating on Freedom Holding Corp. and maintained the stable outlook. The ratings of Freedom KZ and Freedom Bank KZ on the national scale were increased from "kzBBВ" to "kzBBВ+". The positive outlook on Group's financial operating companies reflects substantial achievements in establishing consolidated risk management and compliance and strengthening these functions in its financial subsidiaries.
Current report
Earlier, on November 7, 2024, S&P Global Ratings raised its long-term issuer credit and financial strength ratings on Freedom Insurance to 'BB-' from 'B+'. The outlook is stable. S&P also raised the Kazakhstan national scale rating on Freedom Insurance to 'kzA-' from 'kzBBB+'. The upgrade reflected the view that Freedom Insurance operating performance improved sustainably in 2023 and year to date through 2024.
Current report
•Our fee and commission income for the three months ended June 30, 2025 was $107.6 million, a decrease of $7.8 million, or 7%, compared to the three months ended June 30, 2024. The decrease was mainly attributable to a decrease in fee and commission income from bank services and payment processing.
Current report
We had net income of $30.4 million for the three months ended June 30, 2025, as compared to $34.3 million for the three months ended June 30, 2024. Our Brokerage, Banking, Insurance, and Other segments contributed net income of $74.3 million, net income of $17.4 million, net loss of $1.8 million and net loss of $59.5 million, respectively, to our total net income for the three months ended June 30, 2025.
Current report
Fee and commission income for the three months ended June 30, 2025 amounted to $107.6 million, reflecting a decrease of $7.8 million or 7% compared to $115.5 million for the three months ended June 30, 2024. This decrease was driven by multiple factors, including the factors discussed below.
Current report
Fee and commission income from brokerage services generated $102.9 million, representing a 10% increase from $93.2 million in the three months ended June 30, 2024. This growth was primarily due to an increase in the number of retail brokerage customers from 532,000 as of June 30, 2024 to 725,000 as of June 30, 2025. During the three months ended June 30, 2025 and June 30, 2024, we earned fee and commission income from a market maker customer at our subsidiary Freedom Global of $72.3 million and $64.9 million, representing 67% and 56%, respectively, of our total fee and commission income for that period.
Current report
Fee and commission income from payment processing decreased to $5.9 million in the three months ended June 30, 2025 from $8.6 million for the three months ended June 30, 2024. The $2.6 million decrease is attributable to a strategic decrease in our average acquiring rate and overall decline in transaction turnover during the period.
Current report
Fee and commission income from banking services decreased by $11.9 million during the three months ended June 30, 2025. The decrease was primarily driven by active use by our customers of a cashback-based loyalty program. As part of our strategic approach, we do not prioritize revenue generation from banking service commissions. Instead, the loyalty program is leveraged to effectively reduce transaction costs for customers by supporting our customer base expansion and increasing engagement across the ecosystem.
Current report
For the three months ended June 30, 2025, we had interest income of $198.6 million, representing a decrease of $27.4 million, or 12%, compared to the three months ended June 30, 2024. The decrease was primarily driven by a $54.6 million, or 51% , decrease in interest income on trading securities. This decrease was primarily due to a lower volume of trading securities held during the period.
Current report
This decline was partially offset by increase in other streams of interest income. Specifically, interest income on loans to customers increased by $9.3 million, or 18%, due to the increase in loan portfolio. Similarly, interest income on margin loans to customers rose by $9.2 million, or 18%, reflecting increased customer activity in margin lending.
Current report
(1) Average balance and average yields relate to margin lending activities.
Current report
(2) Average balance, average yields, and interest income relates to corporate debt, non-US sovereign debt and US sovereign debt activities.
Current report
(3) Average yields are computed by dividing interest income by the corresponding average monthly balances.
Current report
Insurance premiums earned, net of reinsurance
Current report
For the three months ended June 30, 2025, we realized a net loss on foreign exchange operations of $12.9 million compared to a net gain of $8.1 million for the three months ended June 30, 2024. The change was primarily due to the translation loss in the amount of $36.7 million which is mainly attributable to the 3% weakening of Kazakhstan tenge against US dollar. This loss was offset by a $23.8 million gain on dealing transactions. This change is mostly attributable to Freedom Bank KZ which had a net gain on sales and purchases of foreign currency of $23.7 million for the three months ended June 30, 2025, compared to a $12.7 million for the three months ended June 30, 2024.
Current report
Fee and commission expense increased by $4.7 million, or 6% in the three months ended June 30, 2025, as compared to the three months ended June 30, 2024. The increase was mainly attributable to a $4.3 million increase in brokerage service expenses in the three months ended June 30, 2025 as compared to the three months ended June 30, 2024, driven by higher customer activity. Additionally, bank services expense increased by $4.2 million during the period, reflecting the continued expansion of our customer base and the growing volume of card transactions within our ecosystem. Furthermore, there was an increase by $1.1 million in agency fee expense mainly due to an increase of insurance product sales by Freedom Life, which are outsourced to outside agents.
Current report
During the three months ended June 30, 2025, total interest expense amounted to $113.4 million, representing a decrease of $32.3 million, or 22%, compared to $145.7 million for the same period in 2024. The decline was primarily driven by changes in average balances and average interest rates across several funding sources.
Current report
There was a decrease in interest expense on securities repurchase agreement obligations, driven by a 31% decline in the average balance, from $2.6 billion during the three months ended June 30, 2024 to $1.8 billion during the three months ended June 30, 2025. This decrease primarily reflects the Company's strategic decision to reduce exposure to market risk by liquidating a portion of the trading portfolio, which historically has been primarily funded through repurchase agreements. As a result, the need for repurchase agreements financing declined, leading to both lower average balances and reduced interest expense.
Current report
Interest expense on customer liabilities increased to $39.3 million in the three months ended June 30, 2025, compared to $23.1 million in the three months ended June 30, 2024. This increase was driven by the growth of customer deposit base reflecting the continued expansion of the Company’s banking segment.
Current report
Interest expense on debt securities issued increased to $13.8 million in the three months ended June 30, 2025, compared to $7.0 million in the three months ended June 30, 2024. This increase was primarily driven by the placement of several new debt securities between the two periods. The impact of the higher balance was partially offset by a decrease in the average interest rate from 11% to 10%. The increase in debt issuance reflects the Company’s long-term funding and investment strategy.
Current report
$10.4 million, or 83%, primarily due to higher redemptions under pension annuity contracts and terminations under accident insurance policies. Claims paid also grew by $9.5 million, or 118%. Part of these claims has been reimbursed from the reinsurers in the amount of $2.9 million.
Current report
Advertising and sponsorship expense
Current report
Advertising and sponsorship expense for the three months ended June 30, 2025, was $24.5 million, representing an increase of $2.6 million, or 12%, compared to $21.9 million for the three months ended June 30, 2024. Sponsorship expense increased by $6.5 million and included several contributions made through Company subsidiaries. The most significant sponsorships during the period were directed to the State Fund "Astana-20" in the amount of $3.4 million and the Junior Football League of Kazakhstan in the amount of$2.5 million, reflecting the Company’s continued support of socially significant initiatives. This increase was partially offset by a$3.3 million decrease in advertising expenditures by Freedom EU, primarily due to the seasonal nature and timing of marketing campaigns. The overall growth in advertising and sponsorship expenses is consistent with the Company’s broader strategy to strengthen brand recognition, expand market presence, and support impactful community-oriented projects.
Current report
General and administrative expense for the three months ended June 30, 2025, was $42.0 million, representing an increase of $1.6 million or 4% compared to general and administrative expense of $40.4 million for the three months ended June 30, 2024. The main factors contributing to the increase were increases in business trip expenses, driven by higher travel activity in connection with expanded operational and strategic initiatives across several regions.
Current report
Total revenue, net for the three months ended June 30, 2025 increased across Brokerage, Banking and Insurance segments compared to the three months ended June 30, 2024. In our segment reporting, we account for all operations within each business segment, including all related subsidiaries and their activities. Below is a discussion of revenue of our segments for the three months ended June 30, 2025 compared to the three months ended June 30, 2024.
Current report
•In the three months ended June 30, 2025, total revenue, net in the Banking segment increased as compared to the three months ended June 30, 2024, mostly driven by a $79.7 million increase in net gain on trading securities due to the price increase on the majority of the governmental securities, a $5.8 million increase in net gain on foreign exchange operations due to an appreciation of the U.S. dollar against the Kazakhstan tenge between the two periods, a $6.0 million increase in other income due to compensation received as early repayment of right-of-claim for purchased historical loans, and a $5.3 million increase in net gain on derivatives due to increased operations with such instruments. These increases were partially offset by a $30.1 million decrease in interest income due to partial disposal of the securities portfolio, and an $11.6 million decrease in fee and commission income due to lower commission rates and increased SuperApp cashback payments in the three months ended June 30, 2025.
Current report
•In the three months ended June 30, 2025, total revenue, net in the Other segment decreased mostly due to a decrease of $13.2 million in net gain on foreign exchange operations from FRHC. The decline was attributable to a reduced appreciation of the U.S. dollar against the Kazakhstani tenge in the three months ended June 30, 2025 compared to the three months ended June 30, 2024. The $5.7 million decrease in Other income in the Other segment was primarily affected by the disposal of our former subsidiary ITS Tech Limited and $4.2 million recognition in the three months ended June 30, 2024. Fee and commission income declined by $4.0 million, which is primarily attributable to a decrease in Paybox's transaction volume following the cessation of operations of its counterparty that previously contributed significantly to such volume. These decreases were partially offset by an increase in sales of goods and services of $12.0 million, driven by our continued expansion into the telecommunications sector and higher order volumes and customer activity at Arbuz, as well as an increase in net gain on trading securities of $7.9 million between the two quarters.
Current report
For the three months ended June 30, 2025, total expenses, net increased across Banking, Insurance and Other segments compared to the three months ended June 30, 2024. Below is a discussion of changes in expenses for each of our segments for the three months ended June 30, 2025 versus the three months ended June 30, 2024:
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Removed paragraphs (103)
Previous report
We own and operate lifestyle-focused platforms such as the e-commerce solution, the premier online travel booking service and the go-to platform for entertainment and event management. These services, alongside our core financial businesses, provide convenience and value for our clients, making FRHC more than a financial services provider but also a lifestyle enabler.
Previous report
From the very beginning, our mission has been to democratize access to international capital markets for retail and institutional clients alike. Today, we are improving the financial industry by creating an integrated digital fintech ecosystem designed to meet the evolving demands of a global customer base. Our strategy centers on providing a seamless, user-friendly experience by combining innovative technologies with a comprehensive suite of services accessible through a single, unified platform. Our ambition is to set the gold standard for digital customer experiences, leveraging advanced technologies to deliver customized solutions that make managing finances and accessing global markets simpler, faster, and more intuitive. By fostering innovation and pushing boundaries, we aim to remain at the forefront of the industry.
Previous report
PrimeEx is a registered agency-only execution broker-dealer on the floor of the New York Stock Exchange ("NYSE"). PrimeEx is a member of the NYSE, Nasdaq, FINRA and the Securities Investor Protection Corp ("SIPC"). PrimeEx conducts investment banking and equity capital markets business under the name Freedom Capital Markets ("FCM").
Previous report
Digital Fintech Ecosystem and Product Expansion
Previous report
In addition to trading capabilities, we have expanded our digital solutions to include mortgages, auto loans, and insurance products. We also operate Ticketon Events LLP ("Ticketon"), the largest online ticket sales company in
Previous report
Kazakhstan and Paybox platform, the digital payment aggregator which enables our customers to accept payments from buyers using a wide range of payment methods, including bank cards, online banking, electronic money, and more.
Previous report
In April 2024, Freedom Bank KZ launched its mobile application, SuperApp, marking a significant milestone in the Kazakhstan financial technology sector. This innovative app consolidates all essential financial services into one platform, offering clients a seamless and convenient way to manage their finances. With SuperApp, clients can easily check their account balances, review transaction histories, make transfers and payments, open and manage deposits, obtain and repay loans, get access to investment, insurance, lifestyle and other products and services. The app also provides real-time portfolio monitoring, along with access to analytical reports and recommendations, empowering users to make well-informed investment decisions. SuperApp's payment services enable users to pay utility and internet bills, mobile phone charges, and other expenses effortlessly. SuperApp not only enhances the user experience but also aligns with our strategic goals. Customer satisfaction is improved through easy access to all banking and investment services in a single app, coupled with an intuitive interface and personalized recommendations.
Previous report
Going forward, we are prioritizing the further development of our digital fintech ecosystem by integrating our online and mobile brokerage services, banking offerings, insurance products, payment processing systems, and online commercial ticketing services. Our strategic objective is to provide customers with a comprehensive and user-centric digital experience, offering them convenient access to a wide array of financial products and services through a single platform. When achieving our strategic objectives, we rely heavily on information technology and its continuous development and innovation to offer our users a seamless customer interaction, meet their diverse needs, and ensure stringent adherence to regulatory requirements and information security standards.
Previous report
On December 12, 2024, S&P Global Ratings affirmed the long-term credit rating of Freedom Holding Corp. at the "B-" level and upgraded the long-term credit ratings of Freedom KZ, Freedom EU, Freedom Global and Freedom Bank KZ from "B" to "B+" level. The short-term credit ratings of Freedom KZ, Freedom EU, Freedom Global and Freedom Bank KZ have been affirmed at "B" level. The ratings of Freedom KZ and Freedom Bank KZ on the national scale were increased from "kzBBВ-" to "kzBBВ". The stable outlooks on Freedom Holding Corp. and its core operating subsidiaries Freedom KZ, Freedom EU, Freedom Global and Freedom Bank KZ reflect S&P's expectations of stable business and financial profiles over the next 12 months, benefiting from reduced economic and industry risks and enhanced regulatory oversight in Kazakhstan. S&P also factor in the group's ongoing measures to strengthen its risk management and compliance, and planned moderation of growth rates, which should support capitalization.
Previous report
•Our fee and commission income for the three months ended December 31, 2024 was $143.4 million, an increase of $23.3 million, or 19%, compared to the three months ended December 31, 2023. The increase was mainly attributable to an increase in fee and commission income from brokerage services and banking services.
Previous report
We had net income of $78.1 million for the three months ended December 31, 2024, as compared to $96.1 million for the three months ended December 31, 2023. Our Brokerage, Banking, Insurance, and Other segments contributed net income of $102.3 million, net income of $34.5 million and net loss of $5.2 million and net loss of $53.4 million, respectively, to our total net income for the three months ended December 31, 2024.
Previous report
For the three months ended December 31, 2024, total fee and commission income was $143.4 million, an increase of $23.3 million, or 19%, as compared to fee and commission income of $120.2 million for the three months ended December 31, 2023.
Previous report
Fee and commission income from brokerage services for the three months ended December 31, 2024 was $118.8 million, representing a 19% increase as compared to $99.8 million for the three months ended December 31, 2023. This increase was primarily due to an increase in the number of retail brokerage customers from 458,000 as of December 31, 2023 to 618,000 as of December 31, 2024. The increase in the number of customers was attributable in part to the migration of customers from our affiliate FST Belize to brokerage companies within our Group between the two quarters. The increase was offset in part by a decrease in fee and commission income from brokerage services generated from FST Belize between the two quarters, as our omnibus brokerage account arrangement with FST Belize was wound down and customers of FST Belize closed their accounts at FST Belize and opened accounts with brokerage companies within our Group. During the three months ended December 31, 2024, we earned fee and commission income from a market maker customer at our Freedom Global subsidiary in an amount of $77.4 million, representing 54% of our total fee and commission income for that quarter.
Previous report
Fee and commission income from payment processing decreased to $7.1 million for the three months ended December 31, 2024 from $9.0 million for the three months ended December 31, 2023. The decrease is attributable to a decrease in transaction volumes between the two quarters, which was in turn due to the cessation of operations of one of our counterparties, which previously contributed a substantial transaction volume.
Previous report
Fee and commission income from banking services increased to $8.4 million in the three months ended December 31, 2024 from $1.3 million in the three months ended December 31, 2023. The increase in fee and commission income from banking services between the two quarters was primarily due to increase in commissions generated on transfer and payment processing, which was a result of an increase in the volume of transfer and payment processing transactions and an increase of cash operations income, by attracting new clients.
Previous report
Fee and commission income from underwriting and market-making activities decreased by 54% to $1.5 million for the three months ended December 31, 2024 from $3.3 million for the three months ended December 30, 2023, driven by a lower volume of underwriting transactions for the three months ended December 31, 2024 as compared to the three months ended December 31, 2023.
Previous report
During the three months ended December 31, 2023, we had a realized gain on trading securities of $9.4 million, which is mainly attributable to debt securities of the Kazakhstan Sustainability Fund JSCsold during the three months ended December 31, 2023. We had an unrealized net loss in amount of $14.4 million in the three months ended December 31, 2023 due to securities positions we continued to hold at December 31, 2023. The majority of the unrealized net loss arose from the securities of Kazakhstan Sustainability Fund JSC, primarily as a consequence of price declines.
Previous report
For the three months ended December 31, 2024, we had interest income of $224.7 million, representing a decrease of $1.8 million, or 1%, compared to the three months ended December 31, 2023. The increase in interest income was primarily attributable to the increase of the income from margin loans to customers by $9.7 million, or 19% due to an increase in the usage of margin loans for trades by our clients between the two periods, partially offset by the decrease in interest income on trading securities by $17.2 million, or 15%, as a result of a decrease in the total size of our trading portfolio and a decrease in the amount of bonds we held as a percentage of our total trading portfolio between the two periods.
Previous report
For the three months ended December 31, 2024, we realized a net gain on foreign exchange operations of $3.9 million compared to a net gain of $38.8 million for the three months ended December 31, 2023. The net gain for the three months ended December 31, 2024, is primarily attributable to a $23.2 million gain from foreign currency transactions, partially offset by a $19.2 million translation loss. The decrease compared to the prior-year period was mainly driven by a 9.1% depreciation of the Kazakhstan tenge against the U.S. dollar, which led to increased foreign exchange currency losses for our subsidiaries operating in Kazakhstan.
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Insurance underwriting income
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Fee and commission expense increased by $51.1 million or 119% in the three months ended December 31, 2024, as compared to the three months ended December 31, 2023. The increase is mainly attributable to an increase of agency fees expense of $44.7 million or 149% compared to the three months ended December 31, 2023. The increase in agency fees expenses was due to an increase in insurance products sales by Freedom Life, which are outsourced to outside agents. The increase in brokerage services, from $4.5 million to $9.4 million, was primarily due to heightened client activity within our brokerage services. This growth in client transactions led to a corresponding increase in associated commission costs. Additionally, other commission expenses rose as a result of higher bank commissions, driven by increased business activity.
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During the three months ended December 31, 2024, total interest expense remained relatively flat compared to the same period in 2023. However, its composition changed due to shifts in funding sources and interest rate dynamics.
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There was a decrease in interest expense on securities repurchase agreement obligations, driven by a 15% decline in the average balance, from $2.9 billion during the three months ended December 31, 2023 to $2.4 billion during the three months ended December 31, 2024. Additionally, the average interest rate applied to these obligations decreased from 16% to 15%, further contributing to the reduction in costs. This decline reflects adjustments in our short-term funding strategy and a shift towards more stable, long-term financing sources.
Previous report
At the same time, interest expense related to customer liabilities increased as the average balance of customer deposits and brokerage account liabilities grew 43% year-over-year, rising from $1.1 billion to $1.6 billion. This increase was caused by a higher average interest rate, which rose from 6% to 7%, reflecting both market-driven adjustments and an expanded customer deposit base.
Previous report
Additionally, interest expense on debt securities issued increased, primarily due to a rise in the average balance, from $131.3 million to $423.6 million. The average interest rate on these instruments also increased, from 5% to 10%, reflecting a shift toward long-term financing at higher prevailing market rates. This increase in debt issuance aligns with our broader funding strategy to support business expansion and strengthen liquidity reserves.
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Advertising expense
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Advertising expense for the three months ended December 31, 2024, was $21.5 million, representing an increase of $10.4 million, or 94%, compared to $11.1 million for the three months ended December 31, 2023. The increase is primarily attributable to an increase in advertising expenses by Freedom Europe of $7.6 million attributable to marketing campaigns that were initiated during fiscal 2024 and continued in the three months ended December 31, 2024. This increase consisted of an increase of approximately $4.1 million on advertising and an increase of $3.8 million on influencer and affiliates advertising. There was also an increase of $2.1 million attributable to Freedom Advertising, an advertising company, out of which $1.8 million was paid to advertising contractors for advertisement placement and promotion. There was also an increase of $1.4 million of advertising expenses attributable to FRHC due to its focus on brand visibility and enhanced marketing efforts.
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General and administrative expense for the three months ended December 31, 2024, was $73.4 million, representing an increase of 41.3 million or 129% compared to general and administrative expense of $32.1 million for the three months ended December 31, 2023. The main factors contributing to the increase was in charity and sponsorship. Our charity and sponsorship expense increased by $31.4 million due to several charitable contributions through our subsidiaries during the three months ended December 31, 2024. The most significant contributions were made to the Kazakhstan Chess Federation, Junior Football League of Kazakhstan, Tennis Federation of the Olympic Committee, and organization of a chess tournament in the USA. Taxes, other than income tax, increased by $2.3 million, mainly due to the general growth of the Group, including the addition of new subsidiaries.
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Non-controlling interest
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As of December 31, 2024, FRHC held a 94.73% ownership interest in Arbuz and a 90.0% ownership interest in ReKassa. The remaining 5.27% of the ownership interest in Arbuz and 10.0% of the ownership interest in ReKassa are recognized as non-controlling interests in our Condensed Consolidated Balance Sheets, Condensed Consolidated Statements of Operations and Statements of Other Comprehensive Income, Condensed Consolidated Statements of Shareholders’ Equity and Condensed Consolidated Statements of Cash Flows.
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Net loss attributable to non-controlling interest was $0.1 million and $0.3 million for the three months ended December 31, 2024 and December 31, 2023, respectively.
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Comparison of the Nine-month Periods Ended December 31, 2024 and 2023
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Revenue
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The following table sets out information or our total revenue, net for the periods presented.
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Percentage of total revenue, net.
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Fee and commission income
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For the nine months ended December 31, 2024, total fee and commission income was $380.0 million, an increase of $49.4 million, or 15%, as compared to fee and commission income of $330.6 million for the nine months ended December 31, 2023.
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Fee and commission income from brokerage services for the nine months ended December 31, 2024 was $319.4 million, representing a 33% increase as compared to $239.6 million for the nine months ended December 31, 2023. This increase was primarily due to an increase in the number of retail brokerage customers from 458,000 as of December 31, 2023 to 618,000 as of December 31, 2024. The increase in the number of customers was attributable in part to the migration of customers from FST Belize to brokerage companies within our Group between the two periods. The increase was offset in part by a decrease in fee and commission income from brokerage services generated from FST Belize between the two periods, as our omnibus brokerage arrangement with FST Belize was wound down and customers of FST Belize closed their accounts at FST Belize and opened accounts with brokerage companies within our Group. During the nine months ended December 31, 2024, we earned fee and commission income from a market maker customer at our subsidiary Freedom Global of $213.6 million, representing 56% of our total fee and commission income for that period.
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Fee and commission income from payment processing decreased to $21.7 million for the nine months ended December 31, 2024 from $37.3 million for the nine months ended December 31, 2023. The $15.6 million decrease is attributable to a significant reduction in transaction volumes between the two periods, which was in turn due to the cessation of operations of one of our counterparties, which previously contributed a substantial transaction volume.
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Fee and commission income from banking services decreased by $10.7 million to $12.7 million during the nine months ended December 31, 2024. The decrease in fee and commission income from banking services between the two periods was primarily due to decrease in commissions generated on transfer and payment processing, which was a result of a lower volume of transfer and payment processing transactions between two periods.
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Reworded paragraphs (75)
Previous wording
All statements other than statements of historical fact included herein, any documents incorporated herein by reference, or any related discussions in this quarterly report on Form 10-Q, if any, including without limitation, statements regarding business strategy, credit rating, impact of new accounting pronouncements, expected capital expenditures and plans to finance such capital expenditure in the telecommunications business, treasury policy, expected outcome of litigation, aims, goals, and plans and objectives, and other than non-historical statements are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. In some cases, forward-looking statements can be identified by terminology such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “forecast,” “future,” “intend,” “likely,” “may,” “might,” “plan,” “potential,” “predict,” “project,” “should,” “strategy,” “will,” “ would,” and other similar expressions and their negatives.
Current wording
This quarterly report on Form 10-Q and any related discussions contains forward-looking statements (as such phrase is used in the federal securities laws) which involve substantial risks and uncertainties. Forward-looking statements generally relate to future events or our future financial or operating performance. All statements, other than statements of historical fact, included herein and in any documents incorporated by reference in this quarterly report on Form 10-Q are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, without limitation, statements regarding aims, goals, and plans and objectives, including business mission and strategy, digital fintech ecosystem development, customer base, features and performance of our products and services, including Freedom SuperApp, our plans for expansion into telecommunication, media and other markets, expected capital expenditures and plans to finance such capital expenditures, credit ratings, impact of new accounting pronouncements, intentions with respect to FFIN Credit, compliance, information security, acquisitions, treasury policy, expected outcome of legal proceedings, our recent inclusion in the Russell 3000® Index including expected benefits of such inclusion, the expected impact of accounting pronouncements and other non-historical statement. In some cases, forward-looking statements can be identified by terminology such as "anticipate," "believe," "continue," "could," "estimate," "expect," "forecast," "future," "intend," "likely," "may," "might," "plan," "potential," "predict," "project," "should," "strategy," "will," "would," and other similar expressions and their negatives.
Previous wording
Forward-looking statements are not guarantees of future performance and involve known and unknown risks and uncertainties, many of which may be beyond our control, which could cause actual results to differ materially from the those implied by the forward-looking statements. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date hereof, and actual results could differ materially as a result of various factors. The following include some but not all of the factors that could cause actual results or events to differ materially from anticipated results or events:
Current wording
Forward-looking statements are not guarantees of future performance and involve known and unknown risks and uncertainties, many of which may be beyond our control, which could cause actual results to differ materially from the those implied by the forward-looking statements. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date hereof, and actual results could differ materially as a result of various factors. The following are some but not all of the factors that could cause actual results or events to differ materially from anticipated results or events:
Previous wording
•economic sanctions and countersanctions that limit movement of funds, restrict access to capital markets or curtail our ability to service existing or potential new customers;
Current wording
•economic sanctions and countersanctions that limit movement of funds, restrict access to capital markets, block access to third party technologies and IT services or curtail our ability to service existing or potential new customers;
Previous wording
•our ability to successfully execute our strategy for entry into new business areas, including among others the telecommunications and media sectors in Kazakhstan;
Current wording
•our ability to successfully execute our strategy for entry into new business areas, including among others the telecommunications, media and health sectors in Kazakhstan;
Previous wording
•the impact of competition, including downward pressures on fees and commissions;
Current wording
•the impact of competition, including downward pressures on fee and commissions;
Previous wording
•the impact of rapid technological change;
Current wording
•the impact of rapid technological change, including incorporation of artificial intelligence (AI) technologies into products and processes;
Previous wording
•the impact of armed conflict in Israel and Gaza and any possible escalation of such conflict or contagion to neighboring countries or regions;
Current wording
•the impact of armed conflict in Israel and Gaza, India-Pakistan conflict, and any possible escalation of such conflicts or contagion to neighboring countries or regions;
Previous wording
Freedom Holding Corp. ("FRHC"), incorporated under the laws of the State of Nevada, combines cutting-edge financial services with an array of lifestyle solutions. Through our subsidiaries, we provide a diverse range of offerings, including securities brokerage, market making, investment research, financial advisory, investment banking, retail and commercial banking, insurance products, payment solutions, and data processing services. We also own several ancillary businesses intended to complement our core financial services businesses, including telecommunications and media businesses in Kazakhstan that are in a developmental stage.
Current wording
Freedom Holding Corp. is organized under the laws of the State of Nevada and acts as a holding company for all of our subsidiaries. Our subsidiaries engage in a broad range of activities including securities brokerage, securities dealing for customers and for our own account, market making activities, investment research, investment counseling, retail and commercial banking, and insurance products. We also own several ancillary businesses and lifestyle solutions, which complement our core financial services businesses, including payment and information processing services, entertainment and travel ticketing services, e-commerce business, and telecommunications and media businesses in Kazakhstan that are in a developmental stage.
Previous wording
The main market of our operations is Kazakhstan. Our operating subsidiaries are located in Kazakhstan, Cyprus, the United States, the United Kingdom, Armenia, the United Arab Emirates, Uzbekistan, Kyrgyzstan, Tajikistan, Azerbaijan, and Turkey, and we also have a presence in Austria, Belgium, Bulgaria, France, Germany, Greece, Italy, Lithuania, The Netherlands, Poland and Spain. We divested our Russian subsidiaries in February 2023. Our subsidiaries in the United States include an SEC- and FINRA-registered broker dealer. As of December 31, 2024, we had 7,761 employees and 204 offices (of which 51 offered brokerage services, 56 offered insurance services, 29 offered banking services and 68 offered other financial and non-financial services).
Current wording
The main market of our operations is Kazakhstan. Our operating subsidiaries are located in Kazakhstan, Cyprus, the United States, the United Kingdom, Armenia, the United Arab Emirates, Uzbekistan, Kyrgyzstan, Tajikistan, Azerbaijan, and Turkey, and we also have a presence in Austria, Belgium, Bulgaria, France, Germany, Greece, Italy, Lithuania, The Netherlands, Poland and Spain. We divested our Russian subsidiaries in February 2023. Our subsidiaries in the United States include an SEC- and FINRA-registered broker dealer. As of June 30, 2025, we had 10,054 employees and 231 offices (of which 44 offered brokerage services, 57 offered insurance services, 30 offered banking services and 100 offered other financial and non-financial services).
Previous wording
Our business is organized into four segments: Brokerage, Banking, Insurance, and Other. Additional information regarding our segments can be found in the narrative and tabular descriptions of segments and operating results under this Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations of this quarterly report; and Note 24 "Segment Reporting" of the notes to our condensed consolidated financial statements included in Item 1 of this quarterly report.
Current wording
Our business is organized into four segments: Brokerage, Banking, Insurance, and Other. Additional information regarding our segments can be found in the narrative and tabular descriptions of segments and operating results under "Management's Discussion and Analysis of Financial Condition and Results of Operations" included in Item 2 of this quarterly report and Note 24 "Segment Reporting" in the notes to our condensed consolidated financial statements included in Item 1 of this quarterly report.
Previous wording
Our Brokerage segment primarily focuses on retail brokerage and investment banking. Our Banking segment encompasses lending, deposit services, payment card services, money transfers, and correspondent accounts, supporting both individual and corporate clients with innovative digital financial solutions. Our Insurance segment offers life and general insurance services. Our Other segment includes payment processing services, e-commerce, online ticket sales, and new business areas including telecommunications and media services. We also engage in proprietary securities trading activities through each of our four segments.
Current wording
Our Brokerage segment primarily focuses on retail brokerage and broader investment banking services. Our Banking segment encompasses lending, deposit services, payment card services, money transfers, and correspondent accounts, supporting both individual and corporate customers with innovative digital financial solutions. Our Insurance segment offers life and general insurance services. Our Other segment includes payment processing services, e-commerce, online ticket sales, and new business areas including telecommunications and media services. We also engage in proprietary securities trading activities through each of our four segments.
Previous wording
The expansion of our retail clients’ activity has been a major driver of our growth, particularly in Kazakhstan, Europe and other Central Asian jurisdictions. Over recent years, we have observed a significant increase in retail clients’ activity across these key markets, which has been instrumental in scaling our business. Below is the table with number of our customer for our key segments:
Current wording
The expansion of our retail customers’ activity has been a major driver of our growth, particularly in Kazakhstan, Europe and other Central Asian jurisdictions. Over recent years, we have experienced a significant increase in retail customers' activity across these key markets, which has been instrumental in scaling our business. Below is the table with the number of our customers across our key segments as of the date indicated:
Previous wording
As of December 31, 2024, in our Brokerage business segment we had 51 offices that provided brokerage and financial services, investment consulting and education, including offices in Kazakhstan, Cyprus, Armenia, United States, Uzbekistan, and Kyrgyzstan and representative offices in a number of other European countries. In addition, following receipt of a principal approval by the Turkey's financial regulatory and supervisory authority granted on January 9, 2025, we are in the process of obtaining a license to provide brokerage services in Turkey. We provide a comprehensive range of securities brokerage services to individuals, businesses and financial institutions. Depending on the region, our brokerage services may include securities trading and margin lending. Our investment banking business consists of investment banking professionals in Kazakhstan, Uzbekistan, and the United States who provide strategic advisory services and capital markets products.
Current wording
As of June 30, 2025, in our Brokerage business segment we had 44 offices that provided brokerage and financial services, investment consulting and education, including offices in Kazakhstan, Europe, Armenia, United States, Uzbekistan, and Kyrgyzstan. In addition, following receipt of a principal approval by the Turkey's financial regulatory and supervisory authority granted on January 9, 2025, we are in the process of obtaining a license to provide brokerage services in Turkey. We provide a comprehensive range of securities brokerage services to individuals, businesses and financial institutions. Depending on the region, our brokerage services may include securities trading and margin lending. Our investment banking business, which includes underwriting and market making activities, is carried out by professionals in Kazakhstan, Uzbekistan and the United States who provide strategic advisory services and capital markets products.
Previous wording
Freedom KZ and Freedom Global are professional participants on the KASE and the AIX. Foreign Enterprise LLC Freedom Finance ("Freedom UZ") is a professional participant on the Republican Stock Exchange of Tashkent ("UZSE") and the Uzbek Republican Currency Exchange ("UZCE").
Current wording
Freedom KZ and Freedom Global are professional participants on the KASE and the AIX. Foreign Enterprise LLC Freedom Finance ("Freedom UZ") is a professional participant on the Republican Stock Exchange of Tashkent ("UZSE") and the Uzbek Republican Currency Exchange ("UZCE") and International Trading System Limited ("ITS"). Freedom Finance Armenia LLC ("Freedom AR") is a professional participant on the Armenia Stock Exchange ("AMX"). Freedom Broker LLC is a professional participant on the Kyrgyz Stock Exchange ("KSE").
Previous wording
Freedom EU oversees our European region operations (including Austria, Belgium, Bulgaria, Cyprus, France, Germany, Greece, Italy, the Netherlands, Poland, Lithuania, Spain, and the United Kingdom). In Cyprus, it is licensed to receive, transmit and execute customer orders, establish custodial accounts, engage in foreign currency exchange services and margin lending, and trade our own investment portfolio. Freedom EU serves as a hub for the Group's brokerage operations, providing transaction processing and intermediary services to our regional customers and to institutional customers that may seek access to the securities markets in the United States and Europe.
Current wording
Freedom EU oversees our European region operations (including Austria, Belgium, Bulgaria, Cyprus, France, Germany, Greece, Italy, the Netherlands, Poland, Lithuania, Spain, and the United Kingdom).Through Freedom EU, we provide transaction processing and intermediary services to our regional customers and to institutional customers that may seek access to the securities markets in the United States and Europe. All trading of United States and European exchange traded and over-the-counter ("OTC") securities by all Freedom group securities brokerage firms, excluding FCM, are also routed to and executed through Freedom EU.
Previous wording
As of December 31, 2024, we had 1,749 employees in our Brokerage segment, including 1,478 full-time employees and 271 part-time employees.
Current wording
As of June 30, 2025, we had 1,859 employees in our Brokerage segment, including 1,681 full-time employees and 178 part-time employees.
Previous wording
Our Banking segment consists of the operations of Freedom Bank KZ, which is a pioneer in digital retail and commercial banking services in Kazakhstan, offering a large variety of deposit, debit and credit cards allowing its customers to make purchases around the world in multiple different currencies, pay in installments or on credit, save their funds, manage their investment accounts, or get an increased cashback that may be transferred to the International Fund for the Salvation of the Aral Sea. Freedom Bank KZ provides digital mortgages, digital car loans, digital business loans, and payment acquiring services for individual entrepreneurs. On October 15, 2024, we obtained a banking license in Tajikistan.
Current wording
Our Banking segment consists of the operations of Freedom Bank KZ and Freedom Bank TJ.
Previous wording
As of December 31, 2024, Freedom Bank KZ's assets decreased by 2%, its loan portfolio increased by 5%, its deposit portfolio increased by 27%, its trading portfolio decreased by 9%, in each case in comparison with March 31, 2024. The increase in the loan and deposit portfolios reflects continued customer demand and growth in our banking services, while the decline in trading portfolio aligns with our strategic focus on core banking operations. During the three months ended December 31, 2024, the banking segment continued to exhibit growth. In particular, net gain on trading securities increased in comparison to the three months ended December 31, 2023, reflecting favorable market conditions and improved trading strategies.
Current wording
As of June 30, 2025, Freedom Bank KZ's assets decreased by 5%, trading portfolio decreased by 17%, loan portfolio increased by 10%, deposit portfolio increased by 2%, in each case in comparison with March 31, 2025. The increase in the loan and deposit portfolios reflects continued customer demand and growth in our banking services, while the decline in trading portfolio aligns with our strategic focus on core banking operations. During the three months ended June 30, 2025, the banking segment continued to exhibit growth. In particular, net gain on trading securities increased in comparison to the three months ended June 30, 2024, reflecting favorable market conditions and improved trading strategies.
Previous wording
We have 29 office locations in Kazakhstan and Tajikistan that provide banking services to our customers. As of December 31, 2024, we had 2,825 employees in our Banking segment, all of which were full-time employees.
Current wording
We have 30 office locations in Kazakhstan and Tajikistan that provide banking services to our customers. As of June 30, 2025, we had 3,384 employees in our Banking segment, all of which were full-time employees.
Previous wording
Freedom Life provides a range of health and life insurance products to individuals and businesses, including life insurance, health insurance, annuity insurance, accident insurance, obligatory worker emergency insurance, travel insurance and reinsurance. As of December 31, 2024, Freedom Life had 973,827 active contracts, as compared to 616,301 active contracts as of March 31, 2024. As of December 31, 2024, Freedom Life had total assets of approximately $510.1 million and total liabilities of approximately $417.4 million, as compared to total assets of approximately $371.5 million and total liabilities of approximately $290.0 million as of March 31, 2024.
Current wording
Freedom Life provides a range of health and life insurance products to individuals and businesses, including life insurance, health insurance, annuity insurance, accident insurance, obligatory worker emergency insurance, travel insurance and reinsurance. As of June 30, 2025, Freedom Life had 984,442 active contracts, as compared to 1,038,516 active contracts as of March 31, 2025. As of June 30, 2025, Freedom Life had total assets of approximately $566.9 million and total liabilities of approximately $472.3 million, as compared to total assets of approximately $554 million and total liabilities of approximately $465.9 million as of March 31, 2025.
Previous wording
Freedom Insurance operates in the "general insurance" industry and is the leader in online insurance in Kazakhstan and offers various general insurance products in property (including automobile), casualty, civil liability, personal insurance and reinsurance. As of December 31, 2024, Freedom Insurance had 567,931 active contracts, as compared to 190,872 active contracts as of March 31, 2024. As of December 31, 2024, Freedom Insurance had total assets of approximately $154.3 million and total liabilities of approximately $95.3 million, as compared to total assets of approximately $158.0 million and total liabilities of approximately $112.8 million as of March 31, 2024.
Current wording
Freedom Insurance operates in the "general insurance" industry and is the leader in online insurance in Kazakhstan offering various general insurance products in property (including automobile), casualty, civil liability, personal insurance and reinsurance. As of June 30, 2025, Freedom Insurance had 1,201,443 active contracts, as compared to 824,838 active contracts as of March 31, 2025. As of June 30, 2025, Freedom Insurance had total assets of approximately $183.4 million and total liabilities of approximately $127.0 million, as compared to total assets of approximately $157.4 million and total liabilities of approximately $105.5 million as of March 31, 2025.
Previous wording
As of December 31, 2024, we had 56 offices and 994 employees, including 955 full-time employees and 39 part-time employees, providing consumer life and general insurance services in Kazakhstan.
Current wording
As of June 30, 2025, we had 57 offices and 1,058 employees, including 1,038 full-time employees and 20 part-time employees, providing consumer life and general insurance services in Kazakhstan.
Previous wording
As of December 31, 2024, in our Other segment we had 68 offices and 2,679 employees, including 2,503 full-time employees and 134 part-time employees, providing a range of services including payment processing, entertainment ticketing sales, online air and railway ticket purchase aggregation and an online retail trade and e-commerce services. In addition, we have recently established subsidiaries in Kazakhstan to operate a telecommunications business and a media business, each of which is in the developmental stage. The revenue of this segment is currently mainly derived from provision of payment processing services, retail online ticket sales and online aggregation of purchasing air and railway tickets.
Current wording
As of June 30, 2025, in our Other segment we had 100 offices and 3,753 employees, including 3,612 full-time employees and 141 part-time employees, providing a range of services including payment processing, entertainment ticketing sales, online air and railway ticket purchase aggregation and an online retail trade and e-commerce services. In the recent years, we have also established subsidiaries in Kazakhstan with a view to developing a telecommunications business and a media business, respectively, each of which is in the developmental stage. In our Other segment we also conduct proprietary securities trading activities, which are mainly conducted by FRHC. The Other segment accounted for $36.9 million, or 7%, of our total revenue, net for the three months ended June 30, 2025. This revenue was mainly derived from provision of payment processing services, retail online ticket sales and online aggregation of purchasing air and railway tickets.
Previous wording
Operating under the "Freedom" brand, our comprehensive suite of digital products and services enables our customers to engage in electronic trading and to monitor their accounts. Our flagship online trading platform Tradernet is designed for a wide range of investors featuring a comprehensive and user-friendly interface and secure infrastructure. The platform allows users to trade a diverse array of financial instruments, including stocks, options, and ETFs from major global exchanges such as the KASE, AIX, NYSE, Nasdaq, ATHEX, the London Stock Exchange, the Chicago Mercantile Exchange, the Hong Kong Stock Exchange and Deutsche Börse.
Current wording
Tradernet is our flagship online trading platform designed for a wide range of investors, offering a comprehensive and user-friendly trading experience. The platform allows customers to trade a diverse array of financial instruments, including stocks, options, and ETFs from major global exchanges such as the KASE, AIX, NYSE, Nasdaq, ATHEX, the London Stock Exchange, the Chicago Mercantile Exchange, the Hong Kong Stock Exchange and Deutsche Börse, EUREX, ICE, SGX, HKFE, CFE, CBOE Europe and ITS. Accessible via both web and mobile platforms, Tradernet allows customers to monitor and manage their investments in real-time through intuitive and customizable interface. At the heart of Tradernet is a robust data platform that provides real-time market data and analytics which supports various trading activities by offering comprehensive data on securities. The back-end infrastructure of Tradernet is designed to handle high volumes of transactions securely and efficiently, promoting the platform's reliability even during peak trading times. The system includes advanced compliance and risk management features to enable trading activities to strictly adhere to the relevant regulations and provide timely advice to manage risks effectively. In addition, Tradernet places a strong emphasis on education and support, providing tutorials, webinars and market analysis reports enabling customers to make informed trading decisions and assist with any issues they may encounter.
Previous wording
In alignment with our digital fintech ecosystem strategy, we are expanding our business by entering the telecommunications market in Kazakhstan and regional media industry in Central Asia. We are seeking to establish a new independent telecommunications operator in Kazakhstan to provide a diverse range of telecommunications and telecommunications-related services to customers which may include, among others, high-quality internet connectivity, mobile virtual network operator (MVNO) services, WiFi access, over-the-top (OTT) streaming, internet protocol television (IPTV), traffic transit for operators and cloud solutions, subject to obtaining applicable licenses, acquisitions of telecom assets or entering into partnerships where required. Our new telecommunications business is operated by Freedom Telecom, a wholly-owned subsidiary of Freedom Holding Corp. incorporated under the laws of the AIFC. Pursuing further development of our telecom business, on September 17, 2024 we completed the acquisition of a 100% interest in SilkNetCom LLP for a purchase price of approximately$23.9 million and on October 17, 2024 we completed the acquisition of a 100% interest in EliteCom LLP for a purchase price of approximately$3.0 million.SilkNetCom LLP is a company specializing in provider services, IT and construction of telecommunications networks in private and public sectors. EliteCom LLP specializes in telecommunications services, including Internet access, telephone services and cable television for individuals (B2C), provision of Internet access services for legal entities (B2B). See Note 22"Acquisitions of subsidiaries" to the condensed consolidated financial statements included in this quarterly report on Form 10-Q. Our strategy and budget for Freedom Telecom are currently being reassessed and are subject to revisions, which may be material. During fiscal 2024, we established Freedom Media LLP ("Freedom Media") as a subsidiary of Freedom Telecom that is intended to become a national media platform in Kazakhstan offering tailored streaming services to the Kazakhstan and broader Central Asia markets. This platform is expected to provide unlimited access to a diverse collection of TV shows, movies, documentaries, and exclusive content across multiple genres.
Current wording
In alignment with our digital fintech ecosystem strategy, we are expanding our business by entering the telecommunications market in Kazakhstan and regional media industry in Central Asia. We are seeking to establish a new independent telecommunications operator in Kazakhstan to provide a diverse range of telecommunications and telecommunications-related services to customers which may include, among others, high-quality internet connectivity, fixed wireless access (FWA), WiFi access, over-the-top (OTT) streaming, internet protocol television (IPTV), traffic transit for operators and cloud solutions, subject to obtaining applicable licenses, acquisitions of telecom assets or entering into partnerships where required. Our new telecommunications business is operated by Freedom Telecom, a wholly-owned subsidiary of Freedom Holding Corp. incorporated under the laws of the AIFC. Pursuing development of our telecom business, on April 30, 2025 we completed the acquisition of a 100% interest in Astel Group Ltd. for a purchase price of approximately $22.3 million. Astel Group Ltd. is a provider of digital solutions and telecommunications services ranked among the largest telecom operators in Kazakhstan. Astel Group Ltd. provides advanced IT solutions including information security and cloud services. See Note 22 "Acquisitions of Subsidiaries" to the condensed consolidated financial statements included in this quarterly report on Form 10-Q. Our strategy and budget for Freedom Telecom are currently being reassessed and are subject to revisions, which may be material. Our telecom services will be offered as a separate product and in a bundle with our other digital products and services and will expand the ecosystem’s reach to areas where traditional banking channels are less efficient.
Previous wording
On July 2, 2024, S&P Global Ratings revised its ratings outlook on Freedom Life to stable from negative. At the same time, S&P Global Ratings affirmed their 'BB' long-term issuer credit and financial strength ratings on Freedom Life. S&P Global Ratings also raised the Kazakhstan national scale rating on Freedom Life to 'kzAA-' from 'kzA+'. S&P Global Ratings consider that Freedom Life remains a strategically important subsidiary of the Group. This is based on Freedom Life's increasing importance to the Group's operations and track record of collaboration with other Group members. S&P
Current wording
On July 2, 2024, S&P Global Ratings revised its ratings outlook on Freedom Life to stable from negative. At the same time, S&P Global Ratings affirmed their 'BB' long-term issuer credit and financial strength ratings on Freedom Life. S&P Global Ratings also raised the Kazakhstan national scale rating on Freedom Life to 'kzAA-' from 'kzA+'. S&P Global Ratings considered Freedom Life to be a strategically important subsidiary of the Group based on its increasing importance to the Group's operations and track record of collaboration with other Group members. S&P Global Ratings also continued to view Freedom Life as an insulated entity due to strong regulatory oversight and its operational independence from the parent.
Previous wording
Our operations have been, and may continue to be, affected by certain key factors as well as certain historical events. For additional information on these factors and other risks that may affect our financial condition and results of operations, see“Management's Discussion and Analysis of Financial Condition and Results of Operations”in Part II Item 7 of the 2024 Form 10-K and “Risk Factors” in Part I, Item 1A, of the 2024 Form 10-K.
Current wording
Our operations have been, and may continue to be, affected by certain key factors as well as certain historical events. The key factors affecting our business and the results of operations include, in particular: market and economic conditions, expansion of our digital ecosystem, acquisitions and expansion into new business areas and markets, our transactions with related parties, our arrangements with market maker customers, and governmental policies. For additional information on these factors and other risks that may affect our financial condition and results of operations, see "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Part II Item 7 of the 2025 Form 10-K and "Risk Factors" in Part I, Item 1A, of the 2025 Form 10-K.
Previous wording
We had total revenues, net of $655.2 million for the three months ended December 31, 2024, as compared to $418.6 million for the three months ended December 31, 2023. The increase between the two quarters was primarily attributable to the following:
Current wording
We had total revenues, net of $533.4 million for the three months ended June 30, 2025, as compared to $455.0 million for the three months ended June 30, 2024. The increase between the two quarters was primarily attributable to the following:
Previous wording
•Our insurance underwriting income for the three months ended December 31, 2024 was $177.5 million, an increase of $98.5 million or 125%, compared to the three months ended December 31, 2023. The increase was driven by the expansion of our insurance operations such as in the pension annuity and accident insurance between the two quarters.
Current wording
•Our insurance premiums earned, net of reinsurance for the three months ended June 30, 2025 were $153.3 million, an increase of $23.8 million or 18%, compared to the three months ended June 30, 2024. The increase was driven by the expansion of our insurance operations such as in the pension annuity and accident insurance between the two quarters.
Previous wording
•We had a net gain on trading securities of $89.6 million for the three months ended December 31, 2024, as compared to a net loss on trading securities of $5.1 million for the three months ended December 31, 2023. The majority of the net gain for the three months ended December 31, 2024 was attributable to the increase in the market prices of Kazakhstan sovereign bonds held in our proprietary portfolio during the quarter.
Current wording
•We had a net gain on trading securities of $45.6 million for the three months ended June 30, 2025, as compared to a net loss on trading securities of $52.1 million for the three months ended June 30, 2024. The majority of the net gain for the three months ended June 30, 2025 was attributable to the increase in the market price of Kazakhstan sovereign bonds held in our proprietary portfolio during the quarter.
Previous wording
•We had a net gain on derivatives for the three months ended December 31, 2024 in the amount of $11.9 million, an increase of $54.5 million, or 128%, compared to the three months ended December 31, 2023. The gain for the three months ended June 30, 2024 was due to revaluation of currency swaps.
Current wording
•We had a net gain on derivatives for the three months ended June 30, 2025 in the amount of $15.5 million, an increase of $3.0 million, or 24%, compared to the three months ended June 30, 2024. The gain for the three months ended June 30, 2025 was due to revaluation of currency swaps.
Previous wording
We had total expense of $556.9 million, for the three months ended December 31, 2024, as compared to $307.0 million for the three months ended December 31, 2023. The increase was mainly attributable to increases in fee and commission expense, insurance claims incurred (net of reinsurance), payroll and bonuses, general and administrative expense, advertising expense and stock based compensation expense.
Current wording
We had total expense of $492.9 million, for the three months ended June 30, 2025, as compared to $413.4 million for the three months ended June 30, 2024. The increase was mainly attributable to increases in fee and commission expense, insurance claims incurred (net of reinsurance), payroll and bonuses, general and administrative expense, advertising and sponsorship expense and stock based compensation expense.
Previous wording
Our total assets increased to $9.1 billion as of December 31, 2024 from $8.3 billion as of March 31, 2024.
Current wording
Our total assets decreased to $9.7 billion as of June 30, 2025 from $9.9 billion as of March 31, 2025.
Previous wording
We had approximately 618,000 total retail brokerage customers as of December 31, 2024 as compared to approximately 530,000 as of March 31, 2024. We had approximately 1,407,000 banking customers at our Freedom Bank KZ subsidiary as of December 31, 2024 as compared to approximately 904,000 as of March 31, 2024.
Current wording
We had approximately 725,000 total retail brokerage customers as of June 30, 2025 as compared to approximately 683,000 as of March 31, 2025. We had approximately 2,927,000 banking customers at our Freedom Bank KZ subsidiary as of June 30, 2025 as compared to approximately 2,515,000 as of March 31, 2025. We had approximately 1,396,000 insurance customers at our Freedom Life and Freedom Insurance subsidiaries as of June 30, 2025 as compared to approximately 1,170,000 as of March 31, 2025.
Previous wording
We had a net gain on trading securities of $89.6 million for the three months ended December 31, 2024, an increase of $94.7 million as compared to a net loss of $5.1 million for the three months ended December 31, 2023. The following table sets forth information regarding our net gains on trading activities during the three months ended December 31, 2024 and 2023:
Current wording
We had a net gain on trading securities of $45.6 million for the three months ended June 30, 2025, an increase of $97.7 million as compared to a net loss of $52.1 million for the three months ended June 30, 2024. The following table sets forth information regarding our net gains on trading activities during the three months ended June 30, 2025 and 2024:
Previous wording
During the three months ended December 31, 2024, we had a realized gain on trading securities of $15.0 million, which is attributable to Kazakhstan sovereign bonds sold during the three months ended December 31, 2024. Also, we recognized an unrealized net gain of $74.6 million during the same period due to an increase in the value of securities positions we held as of December 31, 2024. The majority of the unrealized net gain is attributable to Kazakhstan sovereign bonds.
Current wording
During the three months ended June 30, 2025, we had a realized gain on trading securities of $7.9 million, which is attributable to Kazakhstan sovereign bonds sold during the three months ended June 30, 2025. Also, we recognized an unrealized net gain of $37.7 million during the same period due to an increase in the value of securities positions we held as of June 30, 2025. The majority of the unrealized net gain is attributable to Kazakhstan sovereign bonds.
Previous wording
During the nine months ended December 31, 2024, we had a realized gain on trading securities of $30.3 million, which is attributable to Kazakhstan sovereign bonds sold during the nine months ended December 31, 2024. Also, we recognized an unrealized net gain of $75.5 million during the same period due to the increase in the value of securities positions we held as of December 31, 2024. The majority of the unrealized net gain is attributable to Kazakhstan sovereign bonds, as a consequence of market price increase.
Current wording
During the three months ended June 30, 2024, we had a realized gain on trading securities of $12.8 million, which was attributable to Kazakhstan sovereign bonds sold during the three months ended June 30, 2024. However, we also incurred an unrealized net loss of $64.9 million during the same period due to the decline in the value of securities positions we held as of June 30, 2024. The majority of the unrealized net loss was attributable to Kazakhstan sovereign bonds, as a consequence of their market price decline.
Previous wording
Additionally, the interest income on securities available-for-sale increased by $3.5 million, or 47%, compared to the three months ended December 31, 2023. Such increase was due to the increase of volume of available-for-sale securities which is attributable to the purchase of debt securities of the Ministry of Finance of the Republic of Kazakhstan.
Current wording
Additionally, the interest income on securities available-for-sale increased by $5.0 million, or 59%, compared to the three months ended June 30, 2024. Such increase was due to the increase of volume of available-for-sale securities which is attributable to the purchase of debt securities of the Ministry of Finance of the Republic of Kazakhstan.
Previous wording
Interest income on margin loans to customers includes income accrued on off-balance sheet arrangements, the monthly average balance of which is not included in the table above. These off-balance sheet arrangements mainly included repurchase agreements of our brokerage clients. As of December 31, 2024 and 2023, the monthly average balance of off-balance sheet arrangements were $688.8 million and $569.0 million, respectively, and the weighted average interest rate was 8%, and 12%, respectively.
Current wording
Interest income on margin loans to customers includes income accrued on off-balance sheet arrangements. The monthly average balance of these arrangements is not included in the table above. These off-balance sheet arrangements mainly included repurchase agreements of our brokerage customers. As of September 30, 2024, the monthly average balance of off-balance sheet arrangements was $688.8 million, with a weighted average interest rate of 8%. Following that date, we had no such off-balance sheet arrangements on which we charge an interest. As of June 30, 2025, the monthly average balance of margin loans to customers was $— million and the weighted average interest rates was 0%.
Previous wording
For the three months ended December 31, 2024, we had insurance underwriting income of $177.5 million, an increase of $98.5 million, or 125%, as compared to the three months ended December 31, 2023. The increase was primarily attributable to a $99.3 million, or 128%, increase in insurance underwriting income from written insurance premiums for the three months ended December 31, 2024, as compared to the three months ended December 31, 2023, due to the expansion of our insurance operations such as in the pension annuity and accident insurance between the two quarters. This increase in income from written insurance premiums was partially offset by a $1.9 million decrease in reinsurance premiums ceded for the three months ended December 31, 2024, as compared to the three months ended December 31, 2023. The following table sets out information on our insurance underwriting income for the periods presented.
Current wording
For the three months ended June 30, 2025, we had insurance premiums earned, net of reinsurance of $153.3 million, an increase of $23.8 million, or 18%, as compared to the three months ended June 30, 2024. The increase was primarily attributable to a $24.5 million, or 17%, due to the expansion of our insurance operations such as in the pension annuity and accident insurance between the two quarters. This increase in income from written insurance premiums was partially offset by a $3.8 million increase in change in unearned premium reserve, net for the three months ended June 30, 2025, as compared to the three months ended June 30, 2024. The following table sets out information on our insurance premiums earned, net of reinsurance for the periods presented.
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Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
During fiscal 2024, we established Freedom Media LLP ("Freedom Media") as a subsidiary of Freedom Telecom that is intended to become a national media platform in Kazakhstan offering tailored streaming services to the Kazakhstan and broader Central Asia markets. This platform is built and developed to provide unlimited access to a diverse collection of TV shows, movies, documentaries, and exclusive content across multiple genres.
Rearranged previous paragraphs (22)
Previous report — wording carried elsewhere
Global Ratings continue to view Freedom Life as an insulated entity due to strong regulatory oversight and its operational independence from the parent.
Previous report — wording carried elsewhere
Interest income on margin loans to customers includes income accrued on off-balance sheet arrangements, the monthly average balance of which is not included in the table above. These off-balance sheet arrangements mainly included repurchase agreements of our brokerage clients. As of December 31, 2024 and 2023, the monthly average balance of off-balance sheet arrangements were and $788.2 million, respectively, and the weighted average interest rate was 0.0%, and 11.7%, respectively.
Previous report — wording carried elsewhere
The following table sets forth information regarding our fee and commission income for the periods presented.
Previous report — wording carried elsewhere
The following table sets out the components of our fee and commission income as a percentage of total fee and commission income, net for the periods presented.
Previous report — wording carried elsewhere
The following tables set forth information regarding our revenue from interest income for the periods presented.
Previous report — wording carried elsewhere
The following table provides a summary of the monthly average balances and average interest rates for the major categories of our interest-earning assets for the nine months ended December 31, 2024 and 2023.
Previous report — wording carried elsewhere
The following table sets forth the effects of changing rates and volumes on interest income. The rate column shows the effects attributable to changes in rate (changes in rate multiplied by prior volume). The volume column shows the effects attributable to changes in volume (changes in volume multiplied by prior rate), The net column represents the sum of the prior columns. Changes attributable to changes in both rate and volume that cannot be segregated have been allocated proportionally based on changes due to rate and the changes due to volume.
Previous report — wording carried elsewhere
Net gain on foreign exchange operations
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The following table sets out information on our total expense for the periods presented.
Previous report — wording carried elsewhere
The following table sets forth information regarding our fee and commission expense for the periods presented.
Previous report — wording carried elsewhere
The following table sets out the components of our fee and commission expense as a percentage of total fee and commission expense, net for the periods presented.
Previous report — wording carried elsewhere
The following table provides a summary of the monthly average balances and average interest rates for the major categories of interest-bearing liabilities for the nine months ended December 31, 2024 and 2023.
Previous report — wording carried elsewhere
(1) Average balance, average rates, and interest expense relates to interest-bearing deposits.
Previous report — wording carried elsewhere
The following table sets forth the effects of changing rates and volumes on interest. The rate column shows the effects attributable to changes in rate (changes in rate multiplied by prior volume). The volume column shows the effects attributable to changes in volume (changes in volume multiplied by prior rate). The net column represents the sum of the prior columns. Changes attributable to changes in both rate and volume that cannot be segregated have been allocated proportionally based on changes due to rate and the changes due to volume.
Previous report — wording carried elsewhere
Insurance claims incurred, net of reinsurance
Previous report — wording carried elsewhere
Provision for allowance for expected credit losses
Previous report — wording carried elsewhere
We had income before income tax of $268.4 million and $330.9 million for the nine months ended December 31, 2024, and December 31, 2023, respectively. Income tax expense for the nine months ended December 31, 2024, and December 31, 2023 was $41.5 million and $51.4 million, respectively. The decrease was primarily due to a decrease in our income before income tax between the two periods. In addition, our effective tax rate during the nine months ended December 31, 2024, was 15.5%, the same as during the nine months December 31, 2023. Although our effective tax rate did not change, there were changes in the composition of the revenues we realized from our operating activities, the tax treatment of those revenues in the various jurisdictions where our subsidiaries operate, and the incremental U.S. GILTI tax.
Previous report — wording carried elsewhere
Foreign currency translation adjustments, net of tax
Previous report — wording carried elsewhere
Due to a 18% depreciation of the Kazakhstan tenge against the U.S. dollar during the nine months ended December 31, 2024, we realized a foreign currency translation loss of $187.0 million for the nine months ended December 31, 2024 since most of our Group's companies use the Kazakhstan tenge as their functional currency, as compared to a foreign currency translation loss of $3.6 million for the nine months ended December 31, 2023.
Previous report — wording carried elsewhere
Total expenses associated with our segments are summarized in the following table:
Previous report — wording carried elsewhere
accounts for the exclusive benefit of our brokerage customers.
Previous report — wording carried elsewhere
Telecom are currently being reassessed and are subject to revisions, which may be material. We currently plan to finance our capital expenditures for this business area with a combination of own funds and borrowings, including vendor financing and utilizing the proceeds of a $200 million U.S. dollar domestic bond placement on the AIX that we completed on December 19, 2023. For further information, see "Indebtedness – Long-term" below.