OppFi Q1 Earnings Call Highlights
OppFi (NYSE:OPFI) reported higher first-quarter 2026 revenue but lower adjusted earnings as elevated charge-offs offset growth in receivables, while management emphasized a series of strategic moves aimed at reshaping the company into a broader technology-enabled banking platform.
Executive Chairman and CEO Todd Schwartz and CFO Pam Johnson used the earnings call to highlight OppFi’s planned acquisition of BNCCORP and BNC National Bank, its migration to the LOLA lending system, the launch of a line of credit product, a simplified corporate structure and a new share repurchase authorization.
Revenue Rises, Adjusted Earnings Decline
Johnson said OppFi generated first-quarter revenue of $152 million, up 8% from the first quarter of 2025. She attributed the increase largely to higher receivables, which ended the quarter at $445 million, up 9% year over year.
Originations declined 7% from the prior-year quarter to $176 million. Johnson said the decrease reflected tighter credit for certain consumer segments, which began in the second quarter of 2025, as well as reduced loan demand tied to higher average tax refunds.
Credit costs weighed on profitability. Net charge-offs as a percentage of revenue rose to 42% from 35% in the prior-year quarter, while net charge-offs as a percentage of receivables increased to 55% from 47%. Johnson said revenue yield decreased to 131% from 136% in the first quarter of 2025 due to higher defaults.
Adjusted net income fell 11% to $30 million, and adjusted earnings per share declined to $0.35 from $0.38 a year earlier. Total expenses as a percentage of Total revenue were 34%, flat with the prior-year quarter.
Johnson said OppFi ended the quarter with approximately $100 million in cash, cash equivalents and restricted cash, $284 million in total debt and $343 million in total stockholders’ equity. She said total funding capacity was $625 million at quarter-end, including $241 million in unused debt capacity. OppFi generated $69 million in free cash flow during the quarter.
BNC Deal Expected to Expand Funding and Geographic Reach
Schwartz said OppFi’s planned acquisition of BNCCORP and BNC National Bank, valued at approximately $130 million in cash and stock, is a “pivotal step” toward the company’s goal of becoming a leading digital finance platform for everyday Americans.
BNC National Bank has more than $1 billion in total assets and approximately $1 billion in deposits as of the end of 2025, according to Schwartz. He said more than 80% of BNC’s deposits carry a cost of less than 2%, which OppFi expects will improve balance sheet flexibility and reduce funding costs.
Management said the transaction is expected to close in the fourth quarter of 2026, subject to regulatory approval and other closing conditions. Schwartz said the combination of OppFi’s technology with BNC’s national charter and deposit base is expected to support broader access to financial products for underserved populations.
OppFi expects the transaction to be at least 25% accretive to adjusted EPS in the first year after closing, 40% accretive in the second year and 50% accretive in the third year, Schwartz said. Johnson said OppFi expects adjusted EPS accretion from synergies of at least $60 million in the first year post-closing, $90 million in the second year and more than $115 million in the third year. She said the synergy assumptions are based on geographic expansion, marketing opportunities and funding optimization.
During the question-and-answer session, Northland Securities analyst Mike Grondahl asked for more detail on the expected synergies. Schwartz said a national banking platform would potentially expand OppFi beyond the 40 states where it currently operates, while noting the company would work with regulatory counsel to comply with applicable federal and state laws. He also cited benefits from doing bank partnership activity directly and from the planned line of credit product.
New Products and Credit Models in Focus
Schwartz said OppFi fully deployed its Model 6.1 refit in the first quarter. He said the refit is designed to increase volume while improving overall delinquencies. The company’s current goal is to launch a model refit every six months and a new model annually. Schwartz said OppFi expects to launch Model 7 in the fall of 2026, describing it as the company’s “most powerful model” and saying it will use more artificial intelligence in the model-building process.
OppFi is also preparing to launch a new line of credit product with its bank partners in the summer of 2026. Schwartz said the product will be offered under the OppLoans brand alongside the existing installment product. Initially, he said the line of credit product is expected to open three new geographies and will be offered in certain states, while installment loans will continue to be offered in others. After launch and early data reads, OppFi expects to give customers the option to choose between the two products.
Schwartz said the line of credit product will include similar features to the company’s installment loan product, including no original draw fee, no late fees and no prepayment penalties.
On small business lending, Schwartz said BNC has an established SBA and commercial lending program that will continue through the community bank. He said OppFi’s focus is on working capital small-business originations below $150,000, including products such as revenue-based finance, installment loans and lines of credit. He said the company sees a supply-demand imbalance in that segment and is working with its Bitty investment to develop a fuller suite of small-business products.
LOLA Migration and Corporate Structure Changes
Schwartz said OppFi has completed the building and testing phases for LOLA, its new origination and servicing system, and is finalizing quality assurance. Initial migration is planned for May 2026, with substantial completion expected in the third quarter of 2026.
He said LOLA is expected to improve funnel metrics, increase automated approvals, enhance servicing and recoveries efficiency, integrate major systems, reduce cycle times and improve throughput for product, technology and risk teams. In response to an analyst question, Schwartz said OppFi’s auto-approval rate rose to 79.2% in the first quarter from 78.6% a year earlier, even before the new system migration. He said LOLA should help reduce processing and approval times and cut the cycle time for certain product enhancements by about 50%.
OppFi has also transitioned from an Up-C structure to a traditional C-Corp legal structure. Schwartz said all stockholders now hold Class A common stock with identical economic and voting interests. Johnson said OppFi terminated its tax receivable agreement and recorded tax-amortizable goodwill of approximately $466 million, which is expected to result in approximately $111 million in future cash tax savings, subject to tax changes and other conditions.
Buyback Program and 2026 Outlook
OppFi’s board approved a new $40 million share repurchase program, replacing the prior program. Johnson said the company repurchased 1 million shares of Class A common stock for $9.9 million during the first quarter. She said OppFi plans to deploy cash through a combination of buybacks, dividends and strategic mergers and acquisitions.
Johnson said OppFi is maintaining its 2026 guidance, citing the solid start to the year, economic uncertainty and ongoing investments and restructuring. Schwartz said management is focused on long-term sustainable growth rather than pursuing short-term origination growth, while noting that consumer sentiment, inflationary pressures and broader macroeconomic conditions remain factors the company is watching.
About OppFi (NYSE:OPFI)
OppFi (NYSE: OPFI) is a financial technology company that provides digital lending and credit solutions designed to meet the needs of near-prime consumers in the United States. Through its technology-driven platform, OppFi offers unsecured installment loans under the OppLoans brand, allowing borrowers to access credit online or via mobile devices. The company leverages proprietary data analytics and machine learning models to assess credit risk, streamline underwriting processes and deliver personalized loan products with transparent terms.
Headquartered in Chicago, Illinois, OppFi was founded in 2013 with a mission to increase financial inclusion for underserved and underbanked populations.
This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected].
Where Should You Invest $1,000 Right Now?
Before you make your next trade, you'll want to hear this.
MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis.
Our team has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and none of the big name stocks were on the list.
They believe these five stocks are the five best companies for investors to buy now...
Source MarketBeat
