Core Insights - Ally Financial reported strong third-quarter earnings, with earnings per share of $1.18, exceeding the S&P analysts' consensus estimate of 96 cents, and net income of $371 million, surpassing forecasts of $301.9 million [1][2][7] - The bank's revenue for the quarter reached $2.2 billion, outpacing expectations of $2.11 billion and reflecting a 2% increase from the previous year [2][7] Industry Context - The auto industry is facing challenges, with rising delinquency rates and recent bankruptcies from companies like First Brands and Tricolor [3][4] - In August, auto delinquencies increased across all stages, with 6.43% of subprime auto loans being at least 60 days past due, nearing an all-time high [4] Ally Financial's Performance - Despite industry challenges, Ally Financial experienced a decline in retail auto delinquencies and a charge-off rate for retail auto loans that dropped to 1.88%, down from 2.24% in the same period last year [5][6] - The bank's cautious approach to subprime lending and tightened underwriting standards in 2023 contributed to its strong performance [6]

Core Insights - Warren Buffett is stepping down as CEO of Berkshire Hathaway at the end of the year, with Greg Abel set to take over, although Buffett will remain as Chairman and involved in operations [2][3] - Berkshire Hathaway's stocks are performing well in the Q3 earnings season, with financials leading the way and exceeding analysts' expectations [3][4] Company Performance - **Ally Financial**: Reported adjusted earnings per share of $1.15, beating the consensus of $1.00, with revenue of $2.17 billion surpassing estimates of $2.12 billion. Adjusted earnings more than doubled from $0.43 per share in the same quarter last year [6][7] - **American Express**: Achieved earnings per share of $4.14, exceeding expectations of $3.99, marking a 19% year-over-year increase. Revenue grew 11% to $18.43 billion, surpassing forecasts of $18.05 billion [10][13] - **Bank of America**: Reported earnings per share of $1.06 against expectations of $0.95, with revenue of $28.24 billion beating estimates of $27.5 billion. Profit rose 23% year-over-year to $8.5 billion [16][18] Investment Outlook - Dividend-paying stocks associated with Warren Buffett are expected to perform well as interest rates decline, making them attractive for growth and income investors [4][5] - Ally Financial, American Express, and Bank of America are highlighted as strong buy-and-hold stocks, with favorable ratings from top Wall Street firms [4][8][14]

Core Insights - Investor fears regarding worsening credit conditions eased as regional bank earnings provided relief after a significant market downturn [1][2] - The KBW regional bank index rose after a sharp decline of 6% on Thursday, marking its worst single-day pullback since April [1] Group 1: Regional Bank Earnings - Investors reacted positively to earnings reports from regional banks such as Truist Financial, Fifth Third Bancorp, Huntington Bancshares, and Ally Financial, with most stocks rising in early trading [2] - Loan loss provisions were lower than analysts' expectations for most banks, except for Huntington [2] Group 2: Credit Quality and Risks - Trust CEO Bill Rogers stated that overall credit quality remains strong, despite some idiosyncratic events in the market [3] - The scrutiny of regional banks increased after Western Alliance and Zions disclosed bad loans linked to fraud, causing significant stock declines [4] - Concerns were heightened by recent bankruptcies in the auto lending sector, with Fifth Third reporting a $200 million increase in net charge-offs compared to the previous quarter [6] Group 3: Market Reactions - Stocks of Western Alliance and Zions recovered on Friday after their initial declines, along with Jefferies Financial, which was affected by an auto parts supplier's bankruptcy [4] - Investors in the sector tend to react quickly to credit concerns, often selling first and asking questions later [5]

Core Insights - Ally Financial reported a revenue of $2.17 billion for the quarter ended September 2025, marking a 3.1% increase year-over-year and a surprise of +3.57% over the Zacks Consensus Estimate of $2.09 billion [1] - The earnings per share (EPS) was $1.15, up from $0.95 in the same quarter last year, resulting in an EPS surprise of +16.16% compared to the consensus estimate of $0.99 [1] Financial Performance Metrics - Net interest margin was reported at 3.5%, slightly above the estimated 3.4% [4] - The efficiency ratio stood at 57.2%, higher than the average estimate of 55.3% [4] - Net charge-offs to average finance receivables and loans outstanding were 1.2%, better than the estimated 1.4% [4] - Total interest-earning assets averaged $178.73 billion, below the estimated $181.31 billion [4] - Insurance premiums and service revenue earned were $361 million, slightly below the estimate of $363.92 million, but a +0.6% change year-over-year [4] - Net financing revenue was $1.58 billion, exceeding the estimate of $1.56 billion, with a +6.5% change year-over-year [4] - Total other revenue was reported at $584 million, above the average estimate of $533.43 million, but a -5% change year-over-year [4] - Other income, net of losses, was $170 million, surpassing the estimate of $148.83 million, with a -3.4% change year-over-year [4] - Total financing revenue and other interest income was $3.39 billion, slightly below the estimate of $3.41 billion, reflecting a -5.2% change year-over-year [4] Stock Performance - Ally Financial's shares have returned -13.8% over the past month, contrasting with the Zacks S&P 500 composite's +0.7% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]

Financial Data and Key Metrics Changes - Adjusted EPS increased by 166% year over year to $1.15 per share [5] - Core ROTCE was 15% on a headline basis and about 12% excluding the impact of AOCI [6] - Adjusted net revenue reached $2.2 billion, up 3% year over year, and 9% excluding the sale of the credit card business [6][19] - Net interest margin expanded to 3.55%, up 10 basis points quarter over quarter [6][21] - CET1 ratio of 10.1% equates to $4.5 billion of excess capital above regulatory minimum [7][24] Business Line Data and Key Metrics Changes - Dealer Financial Services reported consumer originations of $11.7 billion, driven by a record 4 million applications [10][30] - Insurance business recorded core pretax income of $52 million, up $6 million year over year [32] - Corporate Finance generated a 30% ROE with a 10% growth in the loan portfolio [12] Market Data and Key Metrics Changes - The digital bank ended the quarter with $142 billion in balances, serving 3.4 million customers [13] - 92% of deposits are FDIC insured, demonstrating the strength of the deposit base [13] Company Strategy and Development Direction - The company is focused on its core franchises, aiming for sustained growth and improved results [15] - The refresh strategy implemented in January has reshaped the organization into a more focused entity [4][5] - The company is leveraging its brand and culture to maintain a competitive edge in the market [9] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in credit performance, noting that consumer behaviors are better than expected despite macro uncertainties [45][46] - The company anticipates modest expansion in portfolio yield and expects full-year net charge-offs to be around 2% [37][38] - Management is committed to disciplined expense management and maintaining a strong capital position [20][25] Other Important Information - The company rolled out its proprietary AI platform, ally.ai, to enhance operational efficiency [8] - The company announced a quarterly common dividend of $0.30 per share, consistent with the prior quarter [26] Q&A Session Summary Question: Concerns about subprime auto and consumer credit trends - Management noted that credit performance metrics are better than expected and that underwriting standards have been tightened [45][46] Question: Expectations for net interest margin (NIM) trajectory - Management provided insights on NIM expansion, indicating it is influenced by Fed rate cuts and competitive market dynamics [48][50] Question: Update on flow to loss trends - Management confirmed that flow to loss rates remain favorable, with delinquency levels decreasing [57] Question: Earning asset expectations and liquidations - Management expects low single-digit growth in earning assets, driven by retail auto and corporate finance [68] Question: Future modifications to the business base - Management expressed satisfaction with the current business mix and indicated no immediate plans for significant changes [75][76] Question: Strength of origination and application volume - Management highlighted record application volumes and the impact of EV lease tax credits on origination strength [81][85]

Financial Data and Key Metrics Changes - Adjusted EPS increased by 166% year-over-year to $1.15 per share, reflecting significant earnings growth [4] - Core ROTCE was 15% on a headline basis and about 12% excluding the impact of AOCI [4] - Adjusted net revenue reached $2.2 billion, up 3% year-over-year, with a 9% increase when excluding the sale of the credit card business [4][12] - Net interest margin expanded to 3.55%, up 10 basis points quarter-over-quarter [4][15] - CET1 ratio of 10.1% equates to $4.5 billion of excess capital above regulatory minimum [4][18] Business Line Data and Key Metrics Changes - Dealer Financial Services reported consumer originations of $11.7 billion, driven by a record 4 million applications [7][24] - Insurance business recorded core pre-tax income of $52 million, up $6 million year-over-year, with total written premiums of $385 million [25] - Corporate finance generated a core pre-tax income of $95 million, reflecting a 30% return on equity [26] Market Data and Key Metrics Changes - The digital bank ended the quarter with $142 billion in balances, serving 3.4 million customers, with deposits representing nearly 90% of total funding [9] - Delinquency rates for retail auto improved to 4.9%, down 30 basis points year-over-year [21] - Consolidated net charge-off rate was 118 basis points, a decline of 32 basis points year-over-year [20] Company Strategy and Development Direction - The company has implemented a refreshed strategy focused on core franchises, resulting in sustained improvement and momentum [3][10] - The emphasis on disciplined expense management and capital allocation is expected to drive long-term value for shareholders [10][19] - The company aims to leverage its brand and culture to maintain competitive advantages in the market [5][6] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in credit performance despite macroeconomic uncertainties, noting better-than-expected consumer behaviors [32][34] - The outlook for net interest margin is expected to migrate to the upper threes over time, influenced by Fed rate cuts [28] - Full-year net charge-offs are projected to be approximately 2% at the low end of the guidance, reflecting positive trends in credit performance [29] Other Important Information - The company rolled out its proprietary AI platform, ally.ai, to enhance operational efficiency [5] - The company announced a quarterly common dividend of $0.30 per share for Q4 2025, consistent with the prior quarter [19] Q&A Session Summary Question: Concerns about subprime auto and consumer credit trends - Management noted that consumer behaviors are better than expected and credit performance remains strong despite macro uncertainties [32][34] Question: Expectations for net interest margin trajectory - Management provided insights on NIM expansion, indicating a historical case study on beta evolution following Fed rate reductions [36][37] Question: Update on flow-to-loss trends - Management confirmed that flow-to-loss rates remain favorable, with delinquency levels continuing to decline [42] Question: Capital return potential and CET1 ratio - Management expressed confidence in capital progress and indicated that share repurchases remain a key priority as capital generation improves [43][45] Question: Earning asset expectations and growth - Management expects low single-digit growth in earning assets, driven by retail auto and corporate finance [49][53]

Core Insights - Ally Financial reported quarterly earnings of $1.15 per share, exceeding the Zacks Consensus Estimate of $0.99 per share, and showing an increase from $0.95 per share a year ago, resulting in an earnings surprise of +16.16% [1] - The company achieved revenues of $2.17 billion for the quarter ended September 2025, surpassing the Zacks Consensus Estimate by 3.57% and up from $2.1 billion year-over-year [2] Earnings Performance - Over the last four quarters, Ally Financial has consistently surpassed consensus EPS estimates, achieving this four times [2] - The company had a previous quarter earnings surprise of +26.92%, with actual earnings of $0.99 compared to an expected $0.78 [1] Stock Performance - Ally Financial shares have increased approximately 6.8% since the beginning of the year, while the S&P 500 has gained 12.7% [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the market in the near future [6] Future Outlook - The current consensus EPS estimate for the upcoming quarter is $1.04 on revenues of $2.13 billion, and for the current fiscal year, it is $3.59 on revenues of $7.85 billion [7] - The outlook for the Financial - Consumer Loans industry, where Ally Financial operates, is currently in the bottom 41% of Zacks industries, which may impact stock performance [8]

Financial Performance - GAAP净收入为3.71亿美元，稀释后每股收益为1.18美元[10] - 核心净收入为3.63亿美元，调整后每股收益为1.15美元[10] - 核心有形普通股回报率为15.3%[10] - 调整后净收入为22亿美元[14] - 净利息收益率为3.55%（不含OID）[14] Capital and Asset Quality - CET1比率为10.1%[14] - 全面实施的AOCI CET1为8.0%[31] - 净冲销为3.95亿美元[24] - 零售汽车贷款（不含对冲）的平均收益率为9.21%[26] Segment Results - 汽车金融税前收入为4.21亿美元[40] - 保险税前收入为7900万美元，核心税前收入为5200万美元[53] - 公司金融税前收入为9500万美元[60] Outlook - 预计全年净利息收益率为3.45%-3.50%（不含OID）[65] - 预计零售汽车净冲销率约为2.0%[65] - 预计综合净冲销率约为1.3%[65]

Core Insights - The third quarter earnings season has begun, with analysts expecting a 7.9% increase in earnings per share for S&P 500 companies, marking the ninth consecutive quarter of positive growth but a slowdown from the 12% growth in Q2 [1][2] Financial Institutions Performance - Major banks including JPMorgan Chase, Goldman Sachs, Wells Fargo, Citigroup, and BlackRock reported their quarterly results, with additional reports from Bank of America, Morgan Stanley, and others following [2][4] - Ally Financial reported earnings per share of $1.18, exceeding estimates of $0.96, with revenue of $2.17 billion surpassing expectations of $2.10 billion [7][8] - Truist's net income rose to $1.3 billion, or $1.04 per diluted share, beating analyst estimates of $0.99 per share, with noninterest income increasing 11% to $158 million [9][10] - Comerica's net interest income grew over 7% to $574 million, while noninterest income declined to $264 million due to slower capital markets activity [11][12] - Fifth Third reported net interest income of $1.52 billion, a 7% year-over-year increase, with earnings per share growing 17% to $0.91, surpassing estimates of $0.86 [14][15] - U.S. Bancorp reported net income of $2.00 billion, or $1.22 per share, beating estimates and achieving record revenue of $7.3 billion [22][23] - Charles Schwab's earnings were $1.26 per share, with record revenue of $6.13 billion, a 27% year-over-year increase [24][25] Technology Sector Insights - Taiwan Semiconductor Manufacturing Company (TSMC) reported a 39% year-over-year profit surge in Q3 and raised its 2025 revenue outlook, anticipating mid-30% annual sales growth [27][28] - TSMC's revenue reached approximately $32.2 billion, exceeding estimates, with earnings per share of $2.92 also beating expectations [28][29] Other Notable Earnings Reports - Morgan Stanley's profits surged 45% in Q3, driven by a 44% increase in deal-making fees to $2.1 billion and a 24% rise in trading fees [36][37][38] - Citigroup's net income for Q3 was $3.8 billion, or $1.86 per diluted share, with total revenue growing 9% to $22.1 billion, driven by increased deal-making and trading activities [46][47]

[Executive Summary & Highlights](index=1&type=section&id=Executive%20Summary%20%26%20Highlights) Ally Financial reported strong Q3 2025 financial results, with significant increases in EPS and pre-tax income, driven by record consumer auto originations and continued retail deposit growth, reflecting improved returns and disciplined execution [Financial Highlights](index=1&type=section&id=Financial%20Highlights) Ally Financial reported strong third-quarter 2025 financial results, with significant year-over-year increases in GAAP and Adjusted EPS, and pre-tax income, reflecting improved returns and disciplined execution across its core businesses | Metric | 3Q 25 | YoY Change | QoQ Change | | :--------------------------------------- | :------ | :--------- | :--------- | | GAAP EPS | $1.18 | +116% | +14% | | Adjusted EPS | $1.15 | +166% | +16% | | GAAP Pre-tax income | $513 million | +$248 million | +$77 million | | Core Pre-tax income | $502 million | +$282 million | +$85 million | | GAAP Net Income Attributable to Common Shareholders | $371 million | +117% | +15% | | Core Net Income Attributable to Common Shareholders | $363 million | +167% | +17% | | Return on GAAP Shareholder's Equity | 11.9% | +104% | +10% | | Core ROTCE | 15.3% | +145% | +12% | | GAAP Total Net Revenue | $2,168 million | +2% | +4% | | Adjusted Total Net Revenue | $2,157 million | +3% | +5% | - Net Interest Margin (NIM) ex. OID increased by **10 basis points** quarter-over-quarter to **3.55%**[10](index=10&type=chunk) - Common equity tier 1 ratio improved to **10.1%**, up approximately **20 basis points** quarter-over-quarter[10](index=10&type=chunk) [Operational Highlights](index=1&type=section&id=Operational%20Highlights) Ally's operational performance was strong, marked by record consumer auto applications, significant auto originations, stable insurance premiums, and continued growth in retail deposits, reinforcing its position as a leading digital bank - Consumer auto originations reached **$11.7 billion** from a record **4.0 million** applications, up **25%** year-over-year[5](index=5&type=chunk)[10](index=10&type=chunk) - Retail auto originated yield was **9.72%**, with **42%** of volume in the highest credit quality tier[10](index=10&type=chunk) - Retail auto net charge-offs decreased by **36 basis points** year-over-year to **1.88%**[10](index=10&type=chunk) - Insurance written premiums were **$385 million**, flat year-over-year, and up **2%** excluding excess of loss reinsurance[10](index=10&type=chunk) - Retail deposits totaled **$142 billion**, with **92%** FDIC insured and **88%** core deposit funded[7](index=7&type=chunk)[10](index=10&type=chunk) - Ally Bank achieved its **66th consecutive quarter** of retail deposit customer growth, serving **3.4 million** customers[7](index=7&type=chunk)[10](index=10&type=chunk) - Corporate Finance delivered a **30% ROE** for the quarter, with criticized assets and non-accrual loans near historic lows[6](index=6&type=chunk)[10](index=10&type=chunk) [CEO Comments](index=1&type=section&id=CEO%20Comments) CEO Michael Rhodes highlighted the quarter's results as proof of continued progress towards improved returns, attributing success to sharper strategic alignment and disciplined execution across all core businesses, including Dealer Financial Services, Insurance, Corporate Finance, and Ally Bank - CEO Michael Rhodes stated that the quarter's results demonstrate continued progress toward improved returns, driven by sharper strategic alignment and disciplined execution[4](index=4&type=chunk)[8](index=8&type=chunk) - Dealer Financial Services showed competitive strength with record consumer applications and **$11.7 billion** in originations, up **25%** year-over-year[5](index=5&type=chunk) - Corporate Finance achieved a **30% ROE**, maintaining low criticized assets and non-accrual loans due to disciplined risk management[6](index=6&type=chunk) - Ally Bank grew its deposit customer base for the **66th consecutive quarter**, reaching **3.4 million** customers and **$142 billion** in retail deposits, solidifying its position as the largest all-digital bank[7](index=7&type=chunk) [Key Financial Metrics](index=1&type=section&id=Key%20Financial%20Metrics) The company reported significant year-over-year growth in key financial metrics for Q3 2025, including substantial increases in GAAP and Adjusted Net Income and EPS, alongside improvements in profitability ratios like Return on GAAP Shareholder's Equity and Core ROTCE | ($ millions except per share data) | 3Q 25 | 2Q 25 | 3Q 24 | Increase / (Decrease) vs. 2Q 25 | Increase / (Decrease) vs. 3Q 24 | | :----------------------------------------- | :------ | :------ | :------ | :------------------------------ | :------------------------------ | | GAAP Net Income (Loss) Attributable to Common Shareholders | $371 | $324 | $171 | 15% | 117% | | Core Net Income Attributable to Common Shareholders | $363 | $309 | $136 | 17% | 167% | | GAAP Earnings per Common Share | $1.18 | $1.04 | $0.55 | 14% | 116% | | Adjusted EPS | $1.15 | $0.99 | $0.43 | 16% | 166% | | Return on GAAP Shareholder's Equity | 11.9% | 10.7% | 5.8% | 10% | 104% | | Core ROTCE | 15.3% | 13.6% | 6.2% | 12% | 145% | | GAAP Common Shareholder's Equity per Share | $41.56 | $39.71 | $39.68 | 5% | 5% | | Adjusted Tangible Book Value per Share | $39.19 | $37.30 | $35.41 | 5% | 11% | | GAAP Total Net Revenue | $2,168 | $2,082 | $2,135 | 4% | 2% | | Adjusted Total Net Revenue | $2,157 | $2,064 | $2,090 | 5% | 3% | [Third Quarter 2025 Financial Results Discussion](index=3&type=section&id=Third%20Quarter%202025%20Financial%20Results%20Discussion) Ally Financial's Q3 2025 results showed significant net income growth driven by higher net financing revenue and reduced credit loss provisions, with varied pre-tax income performance across segments [Consolidated Financial Performance](index=3&type=section&id=Consolidated%20Financial%20Performance) Ally Financial's consolidated performance in Q3 2025 showed a significant increase in net income attributable to common shareholders, driven by higher net financing revenue and a substantial decrease in provision for credit losses, despite a slight increase in noninterest expense - Net income attributable to common shareholders was **$371 million**, a significant increase from **$171 million** in Q3 2024[13](index=13&type=chunk)[18](index=18&type=chunk) - Net financing revenue rose to **$1.6 billion**, up **$64 million** year-over-year, with Net Interest Margin (NIM) at **3.51%** and NIM excluding core OID at **3.55%**, both up over **20 bps** year-over-year[13](index=13&type=chunk)[18](index=18&type=chunk) - Other revenue decreased by **$31 million** year-over-year to **$584 million**, primarily due to a smaller increase in fair value of equity securities compared to the prior year, partially offset by growth in diversified revenue streams[14](index=14&type=chunk)[18](index=18&type=chunk) - Provision for credit losses decreased by **$230 million** year-over-year to **$415 million**, attributed to an increase in retail auto reserve rate in the prior year, lower retail auto net charge-offs, and the sale of the credit card portfolio[15](index=15&type=chunk)[18](index=18&type=chunk) - Noninterest expense increased by **$15 million** year-over-year to **$1,240 million**[16](index=16&type=chunk)[18](index=18&type=chunk) | ($ millions except per share data) | 3Q 25 | 2Q 25 | 3Q 24 | Increase/(Decrease) vs. 2Q 25 | Increase/(Decrease) vs. 3Q 24 | | :----------------------------------------- | :------ | :------ | :------ | :------------------------------ | :------------------------------ | | Net Financing Revenue | $1,584 | $1,516 | $1,520 | $68 | $64 | | Other Revenue | $584 | $566 | $615 | $18 | $(31) | | Provision for Credit Losses | $415 | $384 | $645 | $31 | $(230) | | Noninterest Expense | $1,240 | $1,262 | $1,225 | $(22) | $15 | | Pre-Tax Income (loss) | $513 | $436 | $265 | $77 | $248 | | Net Income (Loss) Attributable to Common Shareholders | $371 | $324 | $171 | $47 | $200 | | GAAP EPS | $1.18 | $1.04 | $0.55 | $0.14 | $0.63 | | Adjusted EPS | $1.15 | $0.99 | $0.43 | $0.16 | $0.72 | [Pre-Tax Income by Segment](index=4&type=section&id=Pre-Tax%20Income%20by%20Segment) Dealer Financial Services maintained stable pre-tax income quarter-over-quarter and saw a significant year-over-year increase, while Automotive Finance's pre-tax income improved year-over-year. Insurance and Corporate Finance experienced slight year-over-year declines in pre-tax income | ($ millions) | 3Q 25 | 2Q 25 | 3Q 24 | Increase/(Decrease) vs. 2Q 25 | Increase/(Decrease) vs. 3Q 24 | | :--------------------------------------- | :------ | :------ | :------ | :------------------------------ | :------------------------------ | | Automotive Finance | $421 | $472 | $355 | $(51) | $66 | | Insurance | $79 | $28 | $102 | $51 | $(23) | | Dealer Financial Services | $500 | $500 | $457 | $— | $43 | | Corporate Finance | $95 | $96 | $105 | $(1) | $(10) | | Corporate and Other | $(82) | $(160) | $(297) | $78 | $215 | | Pre-Tax Income (Loss) from Continuing Operations | $513 | $436 | $265 | $77 | $248 | | Core Pre-Tax Income | $502 | $418 | $220 | $85 | $282 | [Segment Results Discussion](index=4&type=section&id=Segment%20Results%20Discussion) The Auto Finance segment saw increased pre-tax income and improved credit quality, while Insurance experienced a decline due to fair value changes, and Corporate Finance maintained strong profitability despite a slight pre-tax income decrease [Auto Finance](index=4&type=section&id=Auto%20Finance) The Auto Finance segment saw a year-over-year increase in pre-tax income, primarily due to lower provision expense, despite a decrease in net financing revenue. Credit quality improved, with lower net charge-offs and delinquencies, while consumer auto earning assets grew - Pre-tax income was **$421 million**, up **$66 million** year-over-year, driven by lower provision expense[24](index=24&type=chunk) - Net financing revenue was **$1.3 billion**, down **$54 million** year-over-year, primarily due to lower lease gains and commercial assets[24](index=24&type=chunk) - Retail auto portfolio yield, excluding hedges, increased **22 bps** year-over-year to **9.21%**[24](index=24&type=chunk) - Provision for credit losses decreased **$169 million** year-over-year to **$410 million**, reflecting improved credit and a prior year reserve rate increase[25](index=25&type=chunk) - Retail auto net charge-off rate decreased **36 bps** year-over-year to **1.88%**, and 30+ days past due delinquencies decreased **30 bps** year-over-year to **4.90%**[25](index=25&type=chunk) - Consumer auto originations totaled **$11.7 billion**, with **60%** from used retail volume[26](index=26&type=chunk) - End-of-period consumer auto earning assets increased **$2.2 billion** year-over-year to **$93.6 billion**, while commercial earning assets decreased **$2.1 billion** to **$21.8 billion**[27](index=27&type=chunk) [Insurance](index=4&type=section&id=Insurance) The Insurance segment's pre-tax income declined year-over-year due to a decrease in the fair value of equity securities, despite an increase in core pre-tax income driven by higher investment income and stable written premiums - Pre-tax income was **$79 million**, down **$23 million** year-over-year, primarily due to a **$29 million** decrease in the change in fair value of equity securities[28](index=28&type=chunk) - Core pre-tax income increased **$6 million** year-over-year to **$52 million**, driven by higher investment income[28](index=28&type=chunk) - Insurance losses increased **$6 million** year-over-year to **$141 million**, reflecting increased Property & Casualty (P&C) exposure[29](index=29&type=chunk) - Written premiums were **$385 million**, flat year-over-year, and up **2%** excluding excess of loss reinsurance[30](index=30&type=chunk) - Total investment income, excluding fair value changes of equity securities, was **$62 million**, up **$13 million** year-over-year due to higher realized investment gains[30](index=30&type=chunk) [Corporate Finance](index=5&type=section&id=Corporate%20Finance) Corporate Finance reported a slight year-over-year decrease in pre-tax income, mainly due to lower other revenue, but maintained strong profitability with a 30% ROE and continued low levels of criticized assets and non-accrual loans - Pre-tax income was **$95 million**, down **$10 million** year-over-year, driven by lower other revenue[32](index=32&type=chunk) - Net financing revenue increased **$2 million** year-over-year to **$111 million**, due to higher earning assets[32](index=32&type=chunk) - Other revenue decreased **$12 million** year-over-year to **$25 million**, impacted by higher syndication and fee income in the prior year[32](index=32&type=chunk) - Provision expense was **$8 million**, a **$3 million** favorable change year-over-year, primarily due to lower specific reserve activity[33](index=33&type=chunk) - Return on equity (ROE) for the quarter was **30%**[34](index=34&type=chunk) - The held-for-investment loan portfolio stood at **$11.3 billion**, **100%** first lien, with criticized assets at **9%** and non-accrual loans at **1%**, both near historically low levels[34](index=34&type=chunk) [Capital, Liquidity & Deposits](index=5&type=section&id=Capital%2C%20Liquidity%20%26%20Deposits) Ally maintained a strong capital position with an increased CET1 ratio and robust liquidity, supported by substantial cash and deposits, while continuing to grow its retail deposit customer base [Capital](index=5&type=section&id=Capital) Ally maintained a stable common dividend and strengthened its capital position, with the CET1 ratio increasing and a successful credit risk transfer generating additional capital - Ally paid a **$0.30 per share** quarterly common dividend, unchanged year-over-year, and approved the same for Q4 2025[36](index=36&type=chunk) - The common equity tier 1 (CET1) capital ratio was **10.1%**, with risk-weighted assets (RWA) at **$150.7 billion**, down **$0.6 billion** quarter-over-quarter[37](index=37&type=chunk) - A **$5 billion** credit risk transfer was closed at the tightest spread in program history, generating approximately **20 bps** of CET1 at issuance[37](index=37&type=chunk) [Liquidity & Funding](index=5&type=section&id=Liquidity%20%26%20Funding) Ally maintained robust liquidity with substantial cash and highly liquid securities, complemented by significant unused borrowing capacity, ensuring strong funding stability with deposits comprising a large portion of its funding portfolio - Cash and cash equivalents totaled **$9.5 billion**, with highly liquid securities at **$19.9 billion**[38](index=38&type=chunk) - Unused pledged borrowing capacity at FHLB and FRB was **$10.3 billion** and **$26.9 billion**, respectively[38](index=38&type=chunk) - Total current available liquidity was **$66.6 billion**, representing **5.8x** uninsured deposit balances[38](index=38&type=chunk) - Deposits constituted **88%** of Ally's funding portfolio[39](index=39&type=chunk) [Deposits](index=5&type=section&id=Deposits) Ally's retail deposits remained strong, showing year-over-year growth and continued customer acquisition, particularly among younger demographics, while the average retail deposit portfolio yield saw a decrease - Retail deposits were **$141.8 billion**, up **$0.4 billion** year-over-year, but down **$1.3 billion** quarter-over-quarter[40](index=40&type=chunk) - Total deposits reached **$148.4 billion**, with Ally maintaining an industry-leading customer retention rate[40](index=40&type=chunk) - The average retail deposit portfolio yield was **3.48%**, down **70 bps** year-over-year and **10 bps** quarter-over-quarter[41](index=41&type=chunk) - Ally Bank added **44 thousand** net new deposit customers, totaling **3.4 million**, with Millennials and younger customers forming the largest segment of new customers[41](index=41&type=chunk) [Non-GAAP Financial Measures and Reconciliations](index=6&type=section&id=Non-GAAP%20Financial%20Measures%20and%20Reconciliations) This section defines and reconciles various non-GAAP financial measures to their GAAP equivalents, providing clarity on adjustments made to assess Ally Financial's core operating performance and capital adequacy [Definitions of Non-GAAP Financial Measures and Other Key Terms](index=6&type=section&id=Definitions%20of%20Non-GAAP%20Financial%20Measures%20and%20Other%20Key%20Terms) This section provides detailed definitions for various non-GAAP financial measures used by Ally Financial, such as Adjusted EPS, Core ROTCE, and Adjusted Tangible Book Value per Share, explaining their purpose in assessing operating performance and capital adequacy, and outlining the adjustments made to GAAP measures - Non-GAAP financial measures are supplemental to GAAP and are used by management and investors to assess operating performance and capital[43](index=43&type=chunk) - Adjusted EPS adjusts GAAP EPS for strategic or non-operating items to better reflect core business performance[44](index=44&type=chunk) - Core Return on Tangible Common Equity (Core ROTCE) helps understand the company's ability to generate returns on its equity base supporting core operations[45](index=45&type=chunk) - Adjusted Tangible Book Value per Share (Adjusted TBVPS) provides a more conservative assessment of equity value by adjusting for goodwill, intangibles, and tax-effected Core OID balance[47](index=47&type=chunk) - Core Pre-Tax Income adjusts pre-tax income from continuing operations by excluding Core OID, changes in fair value of equity securities, and repositioning items to understand core business operating performance[51](index=51&type=chunk) - Net Interest Margin (excluding Core OID) and Net Financing Revenue (excluding Core OID) are used to better understand profitability and revenue generation by excluding bond exchange OID[55](index=55&type=chunk)[56](index=56&type=chunk) [Reconciliation to GAAP](index=8&type=section&id=Reconciliation%20to%20GAAP) This section provides detailed reconciliations of various non-GAAP financial measures to their most directly comparable GAAP measures, illustrating the adjustments made for items such as Core OID, changes in fair value of equity securities, and repositioning, to derive adjusted metrics like EPS, ROTCE, and pre-tax income [Adjusted Earnings per Share](index=8&type=section&id=Adjusted%20Earnings%20per%20Share) | Numerator ($ millions) | 3Q 25 | 2Q 25 | 3Q 24 | | :--------------------------------------------------- | :------ | :------ | :------ | | GAAP Net Income (Loss) Attributable to Common Shareholders | $371 | $324 | $171 | | Core OID | 17 | 16 | 14 | | Change in the Fair Value of Equity Securities | (27) | (35) | (59) | | Tax on: Core OID, Repo, & Change in Fair Value of Equity Securities (21% tax rate) | 2 | 4 | 9 | | Core Net Income Attributable to Common Shareholders | $363 | $309 | $136 | | Denominator (Weighted-Average Common Shares Outstanding, thousands) | 313,823 | 312,434 | 311,044 | | Adjusted EPS | $1.15 | $0.99 | $0.43 | [Core Return on Tangible Common Equity (ROTCE)](index=8&type=section&id=Core%20Return%20on%20Tangible%20Common%20Equity%20%28ROTCE%29) | Numerator ($ millions) | 3Q 25 | 2Q 25 | 3Q 24 | | :--------------------------------------------------- | :------ | :------ | :------ | | Core Net Income Attributable to Common Shareholders | $363 | $309 | $136 | | Denominator (Average, $ millions) | | | | | GAAP Common Shareholder's Equity | $12,508 | $12,066 | $11,733 | | Goodwill & Identifiable Intangibles, Net of Deferred Tax Liabilities (DTLs) | (187) | (241) | (710) | | Tangible Common Equity | $12,321 | $11,824 | $11,023 | | Core OID Balance | (696) | (713) | (759) | | Net Deferred Tax Asset (DTA) | (2,119) | (2,004) | (1,531) | | Normalized Common Equity | $9,506 | $9,107 | $8,733 | | Core Return on Tangible Common Equity | 15.3% | 13.6% | 6.2% | [Adjusted Tangible Book Value per Share](index=9&type=section&id=Adjusted%20Tangible%20Book%20Value%20per%20Share) | Numerator ($ millions) | 3Q 25 | 2Q 25 | 3Q 24 | | :--------------------------------------------------- | :------ | :------ | :------ | | GAAP Common Shareholder's Equity | $12,793 | $12,223 | $12,090 | | Goodwill and Identifiable Intangible Assets, Net of DTLs | (187) | (187) | (707) | | Tangible Common Equity | 12,606 | 12,036 | 11,383 | | Tax-effected Core OID Balance (21% tax rate) | (544) | (557) | (594) | | Adjusted Tangible Book Value | $12,062 | $11,479 | $10,790 | | Denominator (Issued Shares Outstanding, thousands) | 307,828 | 307,787 | 304,715 | | Adjusted Tangible Book Value per Share | $39.19 | $37.30 | $35.41 | [Adjusted Efficiency Ratio](index=9&type=section&id=Adjusted%20Efficiency%20Ratio) | ($ millions) | 3Q 25 | 2Q 25 | 3Q 24 | | :--------------------------------------------------- | :------ | :------ | :------ | | GAAP Noninterest Expense | $1,240 | $1,262 | $1,225 | | Insurance Expense | (374) | (424) | (365) | | Adjusted Noninterest Expense for Adjusted Efficiency Ratio | $866 | $838 | $860 | | Total Net Revenue | $2,168 | $2,082 | $2,135 | | Core OID | 17 | 16 | 14 | | Insurance Revenue | (453) | (452) | (467) | | Adjusted Net Revenue for Adjusted Efficiency Ratio | $1,732 | $1,646 | $1,682 | | Adjusted Efficiency Ratio | 50.0% | 50.9% | 51.1% | [Original Issue Discount Amortization Expense](index=9&type=section&id=Original%20Issue%20Discount%20Amortization%20Expense) | ($ millions) | 3Q 25 | 2Q 25 | 3Q 24 | | :----------------------------------------- | :------ | :------ | :------ | | GAAP Original Issue Discount Amortization Expense | $19 | $18 | $17 | | Other OID | (2) | (2) | (3) | | Core Original Issue Discount (Core OID) Amortization Expense | $17 | $16 | $14 | [Outstanding Original Issue Discount Balance](index=9&type=section&id=Outstanding%20Original%20Issue%20Discount%20Balance) | ($ millions) | 3Q 25 | 2Q 25 | 3Q 24 | | :----------------------------------------- | :------ | :------ | :------ | | GAAP Outstanding Original Issue Discount Balance | $(708) | $(727) | $(780) | | Other Outstanding OID Balance | 20 | 22 | 29 | | Core Outstanding Original Issue Discount Balance (Core OID Balance) | $(688) | $(705) | $(751) | [Net Financing Revenue (Excluding Core OID)](index=10&type=section&id=Net%20Financing%20Revenue%20%28Excluding%20Core%20OID%29) | ($ millions) | 3Q 25 | 2Q 25 | 3Q 24 | | :----------------------------------------- | :------ | :------ | :------ | | GAAP Net Financing Revenue | $1,584 | $1,516 | $1,520 | | Core OID | 17 | 16 | 14 | | Net Financing Revenue (Excluding Core OID) | $1,601 | $1,532 | $1,534 | [Adjusted Other Revenue](index=10&type=section&id=Adjusted%20Other%20Revenue) | ($ millions) | 3Q 25 | 2Q 25 | 3Q 24 | | :----------------------------------------- | :------ | :------ | :------ | | GAAP Other Revenue | $584 | $566 | $615 | | Accelerated OID & Repositioning Items | — | — | — | | Change in Fair Value of Equity Securities | (27) | (35) | (59) | | Adjusted Other Revenue | $557 | $531 | $556 | [Adjusted Total Net Revenue](index=10&type=section&id=Adjusted%20Total%20Net%20Revenue) | ($ millions) | 3Q 25 | 2Q 25 | 3Q 24 | | :----------------------------------------- | :------ | :------ | :------ | | Adjusted Total Net Revenue | $2,157 | $2,064 | $2,090 | [Adjusted Provision for Credit Losses](index=10&type=section&id=Adjusted%20Provision%20for%20Credit%20Losses) | ($ millions) | 3Q 25 | 2Q 25 | 3Q 24 | | :----------------------------------------- | :------ | :------ | :------ | | GAAP Provision for Credit Losses | $415 | $384 | $645 | | Repositioning | — | — | — | | Adjusted Provision for Credit Losses | $415 | $384 | $645 | [Adjusted Noninterest Expense](index=10&type=section&id=Adjusted%20Noninterest%20Expense) | ($ millions) | 3Q 25 | 2Q 25 | 3Q 24 | | :----------------------------------------- | :------ | :------ | :------ | | GAAP Noninterest Expense | $1,240 | $1,262 | $1,225 | | Repositioning | — | — | — | | Adjusted Noninterest Expense | $1,240 | $1,262 | $1,225 | [Core Pre-Tax Income](index=10&type=section&id=Core%20Pre-Tax%20Income) | ($ millions) | 3Q 25 | 2Q 25 | 3Q 24 | | :----------------------------------------- | :------ | :------ | :------ | | Pre-Tax Income (Loss) | $513 | $436 | $265 | | Core Pre-Tax Income | $502 | $418 | $220 | [Insurance Non-GAAP Walk to Core Pre-Tax Income](index=10&type=section&id=Insurance%20Non-GAAP%20Walk%20to%20Core%20Pre-Tax%20Income) | Insurance ($ millions) | GAAP 3Q 2025 | Change in fair value of equity securities | Non-GAAP1 3Q 2025 | GAAP 3Q 2024 | Change in fair value of equity securities | Non-GAAP1 3Q 2024 | | :----------------------------------- | :----------- | :---------------------------------------- | :---------------- | :----------- | :---------------------------------------- | :---------------- | | Premiums, Service Revenue Earned and Other | $364 | $— | $364 | $362 | $— | $362 | | Losses and Loss Adjustment Expenses | 141 | — | 141 | 135 | — | 135 | | Acquisition and Underwriting Expenses | 233 | — | 233 | 230 | — | 230 | | Investment Income and Other | 89 | (27) | 62 | 105 | (56) | 49 | | Pre-Tax Income from Continuing Operations | $79 | $(27) | $52 | $102 | $(56) | $46 | [Additional Information](index=11&type=section&id=Additional%20Information) This section provides an overview of Ally Financial, clarifies forward-looking statements and non-GAAP measures, defines key operational terms, and lists contact information for investor and media inquiries [About Ally Financial Inc.](index=11&type=section&id=About%20Ally%20Financial%20Inc%2E) Ally Financial Inc. is a diversified financial services company, recognized as the nation's largest all-digital bank and a leader in auto financing, offering a range of services including deposits, investment advisory, auto financing, insurance, and corporate finance solutions - Ally Financial Inc. (NYSE: ALLY) is a financial services company with the nation's largest all-digital bank and an industry-leading auto financing business[76](index=76&type=chunk) - The company provides deposits, securities brokerage, investment advisory services, auto financing, and insurance offerings[76](index=76&type=chunk) - Ally also includes a corporate finance business that offers capital for equity sponsors and middle-market companies[76](index=76&type=chunk) [Forward-Looking Statements](index=11&type=section&id=Forward-Looking%20Statements) This section contains forward-looking statements subject to various risks and uncertainties, including economic conditions, interest rates, and strategic initiatives, which could cause actual results to differ materially from expectations. Readers are cautioned not to rely solely on these statements and to consult SEC filings for further disclosures - The release contains forward-looking statements about financial and operating metrics, performance, and future capital allocation, identifiable by words like 'believe,' 'expect,' 'anticipate,' and 'outlook'[80](index=80&type=chunk) - These statements are subject to assumptions, risks, and uncertainties, including general economic conditions, interest rates, monetary policies, balance sheet composition, and strategic initiatives[80](index=80&type=chunk) - Actual future results may differ materially from forward-looking statements, and readers should consult SEC filings for further disclosures[81](index=81&type=chunk)[82](index=82&type=chunk) [Non-GAAP Financial Measures Disclaimer](index=11&type=section&id=Non-GAAP%20Financial%20Measures%20Disclaimer) The report includes specifically identified non-GAAP financial measures, which are supplementary to GAAP results and should not be considered in isolation. Reconciliations to GAAP are provided where feasible, but forward-looking non-GAAP measures may not be reconcilable due to forecasting difficulties - Non-GAAP financial measures supplement GAAP results and are useful to investors but should not be viewed in isolation or as a substitute for GAAP[83](index=83&type=chunk) - Reconciliations to comparable GAAP measures are provided, but forward-looking non-GAAP measures may not be reconcilable without unreasonable effort due to inherent forecasting difficulties[83](index=83&type=chunk) [Key Term Definitions](index=11&type=section&id=Key%20Term%20Definitions) This section defines key operational terms used throughout the report, such as 'loans,' 'operating leases,' 'consumer,' and 'commercial,' to ensure clarity and consistent understanding of Ally's financial activities - The term 'loans' refers to consumer and commercial products including loans, retail installment sales contracts, lines of credit, and other financing products, excluding operating leases[84](index=84&type=chunk) - 'Operating leases' are consumer- and commercial-vehicle lease agreements where Ally is the lessor and the lessee is generally not obligated to acquire ownership[84](index=84&type=chunk) - 'Consumer' encompasses all consumer products related to loan and operating-lease activities, plus commercial retail installment sales contracts[84](index=84&type=chunk) - 'Commercial' includes all commercial products associated with loan activities, excluding commercial retail installment sales contracts[84](index=84&type=chunk) [Contacts](index=11&type=section&id=Contacts) Contact information for Ally Investor Relations and Ally Communications (Media) is provided for inquiries - Investor Relations contact: Sean Leary, 704-444-4830, sean.leary@ally.com[85](index=85&type=chunk)[86](index=86&type=chunk) - Media contact: Peter Gilchrist, 704-644-6299, peter.gilchrist@ally.com[85](index=85&type=chunk)[86](index=86&type=chunk)