Oportun returned to year-over-year revenue growth in the third quarter for the first time since late 2023, while sharply increasing profit and reducing credit losses. The personal-loan company also raised its full-year revenue and earnings outlook and lowered its expected charge-off rate.
Alongside its results, Oportun introduced “Oportun Forward,” a strategy focused on simplifying its core business, improving offers and service for customers, and making operations more efficient. The company said it will pursue that plan while maintaining credit and capital discipline.
Third-quarter results
- Revenue was $246 million, up 3% from $239 million a year earlier. Originations increased 12% year over year. Oportun said growth was supported by returning unsecured members and secured personal loans.
- GAAP net income rose to $22.9 million from $5.2 million. Diluted earnings per share increased to 45 cents from 11 cents.
- On an adjusted basis, net income increased 38% to $26 million from $19 million, and diluted earnings per share rose to 51 cents from 39 cents. Adjusted EBITDA was $56 million, compared with $41 million a year earlier.
- The annualized net charge-off rate was 10.6%, its lowest level since the third quarter of 2022. Oportun said lower charge-offs and interest expense, alongside revenue growth and expense discipline, contributed to higher profitability.
Updated full-year outlook and strategy
- Oportun now expects full-year revenue of $955 million to $960 million and an annualized net charge-off rate of 11.6%, plus or minus 0.10 percentage point. It also forecast adjusted earnings per share of $1.60 to $1.70, which the company said represents 21% year-over-year growth at the midpoint.
- The company said the revised outlook reflects its third-quarter performance and expectations for the fourth quarter. It raised its revenue and earnings outlook and lowered its expected credit losses; the prior guidance figures were not included in the announcement.
- Under Oportun Forward, the company plans to use its customer data and credit experience to improve offers for qualified applicants, simplify the experience for returning members, and streamline operating processes.
- Oportun cited the additions of Bill Franklin as chief financial officer, Bernardo Martinez as chief retail and sales officer, and Garrett Hope as chief product officer as strengthening its ability to carry out the plan. Franklin said the company intends to invest organically while maintaining the capital, liquidity and funding capacity to operate through economic cycles.
The quarter’s revenue growth marks a return to expansion after several years without year-over-year growth. The updated outlook pairs higher expected earnings with a lower projected charge-off rate, while the company’s stated strategy emphasizes improving its existing business rather than describing a new line of business or acquisition.