OppFi Q2 2026 Earnings Call Summary

1Key Financial Results and Metrics

Revenue: $145 million, a 1.9% increase year-over-year, marking a record for any second quarter.

Originations: Decreased by 9% to $212 million compared to Q2 2025, attributed to tightened underwriting.

Net Charge-Offs: Increased to 40% of revenue (up from 32% YoY) and 52% of receivables (up from 43% YoY). However, recoveries improved to $15 million from $11 million YoY.

Adjusted Net Income: Decreased by 27% to approximately $29 million; adjusted EPS fell to $0.33 from $0.45 YoY.

Operating Expenses: Adjusted operating expenses were $49 million (34% of revenue), slightly down from 35% YoY; unadjusted expenses were 43% of revenue due to one-time costs related to the BNC transaction.

2Strategic Updates and Business Highlights

LOLA System: Refinement of the LOLA system has been prioritized, delaying its rollout but expected to enhance future growth and efficiency.

BNC National Bank Acquisition: Regulatory applications submitted, with expectations to close in Q4 2026. This acquisition is anticipated to provide significant revenue synergies starting in 2027.

Line of Credit Product: Extensive testing completed, with plans to launch next month. This product aims to meet consumer demand for affordability and flexibility in payments.

3Forward Guidance and Outlook

Revised 2026 Guidance: Total revenue expected to be between $600 million and $625 million, adjusted net income between $115 million and $130 million, and adjusted EPS between $1.34 and $1.51.

Long-Term Targets: Confidence remains in achieving approximately $3 EPS by the end of 2028, with continued investment of over $150 million this year to support growth.

4Bad News, Challenges, or Points of Concern

Declining Metrics: The decrease in originations and increased charge-offs raise concerns about credit quality and growth sustainability.

Tightened Underwriting: Adjustments made to underwriting standards due to perceived risks in the consumer credit environment, which could impact growth.

Delayed Product Launches: The line of credit and LOLA system migrations are delayed, affecting near-term revenue expectations and origination targets.

5Notable Q&A Insights

Consumer Credit Trends: Management noted that consumer sentiment has shifted, leading to a tightening in underwriting. They are responding to market demands for more affordable payment options.

Impact of Delays: The delays in launching the line of credit and LOLA system are significant factors in the revised guidance, with the line of credit launch now expected in September.

Recovery Performance: Despite increased charge-offs, management highlighted improved recoveries as a positive indicator of credit performance.

Bank Merger Timeline: Management remains optimistic about closing the BNC acquisition by year-end, pending regulatory approval. Overall, while OppFi faces challenges with declining originations and increased charge-offs, strategic investments and product launches are expected to position the company for future growth.