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    ENVA
    Earnings call· Mar 2026(Q1 FY26)

    Enova International Q1 FY26 earnings call ENVA

    Apr 23, 2026 Source

    Executive summary

    Enova International Q1 FY26 — Strong Originations and Credit Drive Record Revenue and EPS Growth

    Enova International delivered a strong start to the year, driven by robust originations and solid credit performance across its diversified portfolio. The company achieved record revenue and significant adjusted EPS growth, leveraging its scalable operating model and advanced risk management. Management raised its full-year outlook, confident in its ability to navigate the evolving macro environment and capitalize on opportunities, including the pending Grasshopper Bank acquisition.

    Highlights

    5

    • Originations increased 33% year-over-year to nearly $2.3 billion.

    • Total portfolio grew 28% year-over-year to nearly $5.3 billion.

    • Revenue increased 17% year-over-year to a record $875 million.

    • Adjusted EPS increased 30% year-over-year to $3.87 per diluted share.

    • Consolidated net charge-off ratio declined 100 basis points year-over-year to 7.6%, the lowest since Q2 2023.

    Concerns

    3

    • Marketing costs increased to 22% of revenue ($189 million) compared to 19% ($139 million) in Q1 FY25.

    • Operations and technology expenses increased to 8.7% of revenue ($76 million) compared to 8.4% ($62 million) in Q1 FY25.

    • Consumer revenue growth of 3% year-over-year was significantly lower than SMB revenue growth of 37% year-over-year.

    Guidance & targets

    9
    CategoryTargetConfidence
    Total Company Revenue Growth
    15% to 20% higher year-over-year
    high materiality
    High
    Total Company Net Revenue Margin
    55% to 60%
    medium materiality
    High
    Marketing Expenses as % of Revenue
    around 20%
    medium materiality
    Medium
    Operations and Technology Expenses as % of Revenue
    around 8% to 8.5%
    medium materiality
    Medium
    General and Administrative Expenses as % of Revenue
    around 5%
    medium materiality
    Medium
    Adjusted EPS Growth
    20% to 25% higher than the second quarter of 2025
    high materiality
    High
    Originations Growth
    around 20%
    high materiality
    High
    Revenue Growth
    similar to originations growth
    high materiality
    High
    Adjusted EPS Growth
    at least 25%
    high materiality
    High

    Segment performance

    3
    SegmentRevenueYoYQoQMargin
    Total Company
    Record revenue driven by strong originations growth and portfolio expansion.
    Originations: $2.3 billionOriginations growth YoY: 33%Total portfolio (amortized basis): $5.3 billionTotal portfolio growth YoY: 28%
    		$875 million17%——
    Small Business
    Continued remarkable growth and stable credit, driven by leading brand presence and competitive position.
    Originations: $1.7 billionOriginations growth YoY: 42%Receivables (amortized basis): $3.7 billionReceivables growth YoY: 39%Portfolio share: 70%
    		$418 million37%——
    Consumer
    Year-over-year growth in originations accelerated, with stable or improved credit metrics.
    Originations: $559 millionOriginations growth YoY: 10%Receivables (amortized basis): $1.6 billionReceivables growth YoY: 8%Portfolio share: 30%
    		$446 million3%——

    Operational metrics

    9
    Adjusted EPS
    $3.8730% increase YoY
    Q1 FY26

    Non-GAAP measure.

    Total Operating Expenses as % of Revenue
    36%vs 33% in Q1 FY25
    Q1 FY26

    Includes marketing expenses.

    Marketing Expenses
    $189 millionup from $139 million in Q1 FY25
    Q1 FY26

    Increased to drive strong originations growth.

    Operations and Technology Expenses
    $76 millionup from $62 million in Q1 FY25
    Q1 FY26

    Driven by growth in receivables and originations.

    General and Administrative Expenses
    $48 millionvs $42 million in Q1 FY25
    Q1 FY26

    Includes $2.7 million of one-time deal-related expenses for Grasshopper acquisition.

    Total Liquidity
    $1.1 billion
    Q1 FY26 end

    Provides financial flexibility.

    Cost of Funds
    8.2%down from 8.3% in Q4 FY25
    Q1 FY26

    Reflects strong execution in recent financing transactions.

    Shares Acquired
    110,000 shares
    Q1 FY26

    Part of opportunistic share repurchases.

    Consumer Gas Spending as % of Income
    around 2%slight increase since
    Prior to Iran War

    Based on electronic bank statement data, showing consumers adapting to higher gas prices without material impact on overall spending.

    Industry KPIs

    10
    MetricValueDetails
    Funding mix—
    Payment rate—
    Delinquencies—
    Capital returns$16 millionUSD
    Credit quality mix—
    Net charge off rate7.6%%
    Loans card receivables$5.3 billionUSD
    New accounts card acquisitions—
    Billed business purchase volume$2.3 billionUSD
    Net interest margin yield on receivables60%%

    Deals & partnerships

    2
    Grasshopper BankAcquisition of Grasshopper Bank to transition to a bank holding company, enabling geographic expansion and lower funding costs.

    Engaged in constructive dialogue with OCC and Federal Reserve for application process. Internal teams are deep into integration planning to ensure readiness and deliver significant synergies.

    Multiple debt facilitiesUpsized four secured consumer and small business warehouse facilities.$377 million

    Upsized facilities at existing terms, reflecting strong capital markets execution.

    Risks & headwinds

    3
    Rising energy costs (gasoline prices)Current (since Iran War)

    Slight increase in consumer spending on gas relative to income (from ~2% of income prior to Iran War).

    Mitigation: Consumers adapt behavior (fuel-efficient autos, EVs, ridesharing, on-demand delivery). Historically, no material impact on originations or credit performance during similar spikes (e.g., 2022). Demand for products typically increases to bridge temporary cash flow gaps.

    Geopolitical or domestic policy issuesOngoing

    Not quantified, but mentioned as concerns.

    Mitigation: Resiliency of consumer and small business customers; diversified product offerings, scalable operating model, and advanced risk management capabilities.

    Macroeconomic environment impact on demand and payment ratesNear-term (Q2 FY26) and Full-Year FY26

    Not quantified, but noted as a dependency for Q2 and full-year expectations.

    Mitigation: Talented team, world-class technology and analytics, resilient online-only business model, diversified product offerings, nimble machine learning-powered credit risk management capabilities, and solid balance sheet position the company to adapt.

    What to watch in Q2 FY26

    5

    Consumer Originations Growth

    Next quarter
    Current10% YoY
    TargetContinued acceleration

    Why it matters

    Management expects consumer growth to accelerate and diminish the disparity with SMB, indicating a more balanced portfolio growth.

    I think you should expect to continue to see the consumer year-over-year growth to accelerate... I also think we'll continue to see that acceleration in consumer. So the disparity, I think we should -- all things being equal and with the strong operating backdrop, I think you'll see that disparity diminish.

    Q&A highlights

    5

    Inquired about the disparity in growth between SMB and Consumer originations, where marketing costs were incurred, and the outlook for consumer growth re-acceleration.

    Steve Cunningham explained that SMB has consistently grown over 20% for two years, with efficient marketing. Consumer growth is re-accelerating after a purposeful slowdown in mid-last year, particularly in installment loans and LOC products. He expects consumer year-over-year growth to continue accelerating, diminishing the disparity with SMB. Marketing remains efficient across both segments.

    “I think you should expect to continue to see the consumer year-over-year growth to accelerate. As we look back into some of the quarters last year where we had purposely slowed down. So I think I expect we'll continue to see healthy SMB growth, but I also think we'll continue to see that acceleration in consumer. So the disparity, I think we should -- all things being equal and with the strong operating backdrop, I think you'll see that disparity diminish.”

    asked by Moshe Orenbuch · answered by Steven Cunningham

    2 min read5 chapters

    Detailed Narrative

    01

    Strong Originations and Portfolio Growth

    Enova reported a robust 33% year-over-year increase in originations, reaching nearly $2.3 billion, which drove a 28% year-over-year expansion in its total portfolio to almost $5.3 billion. This growth was fueled by strong demand and solid credit performance, allowing the company to strategically increase marketing spend to meet demand while maintaining attractive unit economics. The SMB segment continued its strong trajectory, with originations up 42% year-over-year, while consumer originations accelerated to 10% year-over-year.

    02

    Credit Performance and Macroeconomic Resilience

    Consolidated net charge-offs improved significantly, falling 100 basis points year-over-year to 7.6%, the lowest since Q2 2023, reflecting stable or improving credit across both consumer and SMB portfolios. Management highlighted the resilience of its customer base despite market volatility🌐 and geopolitical concerns, citing stable labor markets, growth in real wages, and consistent small business optimism. The company noted that consumers are adapting to higher gas prices without material impact on overall spending or credit performance, similar to trends observed in 2022.

    03

    Strategic Technology and AI Adoption

    Enova emphasized its long-standing commitment to technology and analytics, including machine learning and generative AI, to enhance customer experience, manage risk, and improve efficiency. The company views AI as a tool to defend and extend its competitive advantages, enabling faster insights and smarter operations. This tech-forward approach is deeply integrated into its culture, contributing to consistent and profitable lending across diverse economic environments.

    04

    Grasshopper Bank Acquisition Update

    The company provided an update on its pending acquisition of Grasshopper Bank, confirming continued progress and constructive dialogue with the OCC and Federal Reserve. Internal teams are actively engaged in integration planning to ensure a smooth transition and realize significant synergies, including geographic expansion and lower funding costs from Grasshopper's deposits. The transaction is still expected to close in the second half of 2026, with anticipated adjusted EPS accretion of over 25% once synergies are fully realized within two years post-closing.

    05

    Capital Markets and Liquidity

    Enova maintained a strong balance sheet and liquidity position, ending the quarter with approximately $1.1 billion in liquidity, including $436 million in cash and $654 million in available debt facility capacity. The company successfully upsized four secured consumer and small business warehouse facilities by $377 million at existing terms, demonstrating strong capital markets execution and providing additional capacity for growth. The cost of funds slightly decreased to 8.2% from 8.3% in the prior quarter.

    AI-generated summary of the company’s earnings call. Not investment advice.