Core Insights - Open Lending Corporation has appointed Abhijit "Abhi" Chaudhary to its Board of Directors as a Class I director, effective November 21, 2025, replacing Gene Yoon [1] - Mr. Chaudhary brings over 20 years of experience in product strategy for growth-oriented financial services, currently serving as Executive Vice President at Mastercard [2] - The CEO of Open Lending, Jessica Buss, expressed that Mr. Chaudhary's experience in scaling disruptive technology will provide valuable insights to the Board [3] Company Overview - Open Lending Corporation provides lending enablement and risk analytics solutions for financial institutions, focusing on loan analytics, risk-based pricing, risk modeling, and default insurance for auto lenders in the U.S. [4] - The company has been empowering financial institutions for 25 years to create profitable auto loan portfolios with reduced risk and increased rewards [4]

Core Viewpoint - Open Lending (LPRO) has been upgraded to a Zacks Rank 2 (Buy), indicating a positive trend in earnings estimates which is a significant factor influencing stock prices [1][3]. Earnings Estimates and Stock Price Movement - The Zacks rating system is based on changes in earnings estimates, which are closely correlated with near-term stock price movements [4][6]. - An increase in earnings estimates typically leads to higher fair value calculations by institutional investors, resulting in buying or selling pressure that affects stock prices [4]. Open Lending's Earnings Outlook - The recent upgrade for Open Lending reflects an improvement in the company's underlying business, which is expected to drive the stock price higher [5]. - Over the past three months, the Zacks Consensus Estimate for Open Lending has increased by 17.9%, indicating a positive shift in earnings expectations [8]. Zacks Rank System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with a strong historical performance, particularly for Zacks Rank 1 stocks which have averaged a +25% annual return since 1988 [7]. - Open Lending's upgrade to Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, suggesting a strong potential for market-beating returns in the near term [10].

Group 1 - The article does not provide any specific content or key points related to a company or industry [1]

Core Insights - Open Lending (LPRO) reported revenue of $24.17 million for the quarter ended September 2025, reflecting a year-over-year increase of 2.9% and a positive surprise of 12.78% over the Zacks Consensus Estimate of $21.43 million [1] - The earnings per share (EPS) for the quarter was $0.03, significantly higher than the $0.01 reported in the same quarter last year, resulting in an EPS surprise of 200% compared to the consensus estimate [1] Revenue Breakdown - Revenue from profit share was $8.47 million, exceeding the average estimate of $6.65 million by two analysts, representing a year-over-year increase of 24.2% [4] - Revenue from program fees was $13.34 million, slightly above the average estimate of $12.31 million, but showed a year-over-year decline of 5.8% [4] - Revenue from claims administration service fees was $2.36 million, which was below the average estimate of $2.47 million, indicating a year-over-year decrease of 5.5% [4] Stock Performance - Over the past month, shares of Open Lending have returned -13.7%, contrasting with the Zacks S&P 500 composite's increase of 1.3% [3] - The stock currently holds a Zacks Rank 3 (Hold), suggesting it may perform in line with the broader market in the near term [3]

Financial Data and Key Metrics Changes - Total revenue for Q3 2025 was $24.2 million, up 3% from the prior year period, including a positive $1.1 million change in estimate profit-share revenue associated with historical vintages [24][25] - Net losses for Q3 2025 were $7.6 million compared to net income of $1.4 million in Q3 2024, with diluted net loss per share at $0.06 [27] - Adjusted EBITDA for Q3 2025 was $5.6 million compared to $4.5 million in Q3 2024, excluding a one-time payment of $11 million [27] Business Line Data and Key Metrics Changes - The company facilitated 23,880 certified loans in Q3 2025, down from 27,435 in Q3 2024, reflecting a deliberate tightening of lending standards [11][23] - Program fee revenues were $13.3 million, profit-share revenues were $8.5 million, and claims administration fees and other revenues were $2.4 million in Q3 2025 [24] - Profit-share revenue associated with new originations was $7.4 million, or $310 per certified loan, compared to $13.8 million, or $502 per certified loan in Q3 2024 [25] Market Data and Key Metrics Changes - The CERT mix by channel for the quarter was 89.8% through credit unions and banks, with 10.2% from OEMs, indicating a drop in OEM production due to tighter underwriting requirements [12] - Credit builder exposure has been reduced, with super thin files now comprising a negligible amount of new originations, down from 24% in Q3 2024 to 6% [13] Company Strategy and Development Direction - The introduction of Apex One Auto, a new prime credit automated decisioning platform, aims to diversify revenue and add a recurring revenue stream through subscription-based minimum application volumes [6][9] - The company is focused on improving profitability and reducing volatility in profit-share unit economics, achieving three consecutive quarters of positive Adjusted EBITDA [10][11] - The company amended its contract with Allied Solutions, expected to generate over $2.5 million in annual cost savings once fully implemented in 2027 [26] Management's Comments on Operating Environment and Future Outlook - Management noted ongoing challenges such as rising delinquencies and affordability pressures but emphasized proactive measures to capture opportunities [13][20] - The company believes it is well-positioned for growth in 2026, with improved underwriting and pricing actions [34] - Management highlighted that the tightening of credit standards has positioned the company for more sustainable profitability in future vintages [11][21] Other Important Information - The company exited Q3 with $287.7 million in total assets, including $222.1 million in unrestricted cash [28] - Operating expenses were $26.6 million in Q3 2025, a 71% increase year over year, primarily due to a one-time payment to Allied [26][27] - The company is actively recruiting for a new Chief Revenue Officer to refresh its go-to-market strategy [19] Q&A Session Summary Question: Details on Apex One Auto's subscription model - Apex One Auto will be a completely subscription-based product with three-year contracts and monthly minimums, with overage fees per loan charged for amounts exceeding the minimum [31] Question: Expected savings from the Allied contract amendment - The anticipated $2.5 million annual savings will start phasing in during the second half of 2026, with the majority realized in 2027 [32] Question: Insights on the macro environment and stabilization - Management indicated that 2025 was a transition year with significant tightening and changes to pricing models, positioning the company well for growth in 2026 [33][34] Question: Expectations for fourth quarter certified loan assumptions - The fourth quarter is typically one of the lowest CERT volume quarters, with expectations for stabilization as the company moves into 2026 [36] Question: Long-term expectations for Apex One Auto uptake - If Apex One captures a 50% adoption rate among credit unions, revenues could reach between $30 million and $40 million, indicating significant growth potential [39]

Financial Performance - Revenue increased to $24.2 million in Q3 2025 from $23.5 million in Q3 2024[3] - Adjusted EBITDA increased to $5.6 million in Q3 2025 from $4.5 million in Q3 2024[3] - The company experienced a net loss of $7.569 million in Q3 2025, compared to a net income of $1.437 million in Q3 2024[19] - Adjusted EBITDA margin was 23% in Q3 2025, compared to 19% in Q3 2024[20] Loan Origination - Total certified loans decreased to 23,880 in Q3 2025 from 27,435 in Q3 2024[3] - Facilitated loan origination volume decreased to $701.7 million in Q3 2025 from $772.5 million in Q3 2024[16] - Average loan size increased to $29,384 in Q3 2025 from $28,156 in Q3 2024[16] Loan Portfolio Mix - CU/Bank channel loans accounted for 89.8% of the total in Q3 2025, up from 79.5% in Q3 2024, while OEM loans accounted for 10.2%, down from 20.5%[5] - Used vehicle certs accounted for 87.5% of the total in Q3 2025, compared to 87.1% in Q3 2024[8] - Direct certs accounted for 19.8% of the total in Q3 2025, compared to 19.5% in Q3 2024[8,18] - Refinance certs accounted for 5.8% of the total in Q3 2025, compared to 3.2% in Q3 2024[8,18] Credit Profile - Credit builder loans accounted for 6.3% of the total in Q3 2025[11]

Financial Performance - Total revenue for the three months ended September 30, 2025, was $24.2 million, a slight increase from $23.5 million in the same period of 2024, while revenue for the nine months ended September 30, 2025, was $73.9 million, down from $80.9 million in 2024[95]. - Net loss for the three months ended September 30, 2025, was $7.6 million, compared to net income of $1.4 million in the same period of 2024, and net loss for the nine months ended September 30, 2025, was $5.9 million, down from net income of $9.4 million in 2024[96]. - Total revenue for the nine months ended September 30, 2025, decreased by $7.1 million, or 9%, primarily driven by a $6.9 million decrease in profit share revenue[131]. - Operating income decreased by $18.9 million, or 144%, resulting in an operating loss of $5.8 million for the nine months ended September 30, 2025[141]. - For the three months ended September 30, 2025, Adjusted EBITDA was $5.553 million, representing a margin of 23%, compared to $4.546 million and a margin of 19% for the same period in 2024[158]. - For the nine months ended September 30, 2025, Adjusted EBITDA decreased to $12.805 million from $20.868 million in 2024, reflecting a reduction in revenue primarily due to lower certified loan volume and profit share unit economics[159]. Loan and Revenue Metrics - The company facilitated 23,880 certified loans in the three months ended September 30, 2025, compared to 27,435 in the same period of 2024, representing a decrease of 13%, and 78,040 loans in the nine months ended September 30, 2025, down 8% from 84,587 in 2024[94][100]. - The value of insured loans facilitated was $701.7 million for the three months ended September 30, 2025, compared to $772.5 million in 2024, and $2.27 billion for the nine months ended September 30, 2025, down from $2.38 billion in 2024[99]. - The average loan size per certified loan increased to $29,384 for the three months ended September 30, 2025, compared to $28,156 in 2024, and was $29,062 for the nine months ended September 30, 2025, compared to $28,132 in 2024[99]. - Profit share revenue increased by $1.6 million, or 24%, due to an $8.0 million increase in the change in estimate adjustment, partially offset by a $6.4 million decrease in anticipated profit share revenue from new certified loan originations[118]. - New certified loan originations decreased by 46% to $7.4 million, with an average of $310 per loan compared to $502 per loan in the prior year[119]. Operating Expenses - Total operating expenses increased by $11.1 million, or 71%, primarily due to a one-time payment of $11.0 million related to the Allied Amendment[125]. - General and administrative expenses increased by $11.5 million, or 120%, primarily driven by the aforementioned one-time payment and a $0.5 million increase in employee compensation[125]. - Operating expenses increased by $12.5 million, or 25%, with general and administrative expenses rising by $10.6 million, or 32%[138]. Cash Flow and Financing - Net cash used in operating activities was $(8.6) million for the nine months ended September 30, 2025, a decrease of $29.6 million compared to $21.0 million in 2024[147]. - Net cash used in investing activities was $0.9 million, primarily related to capitalized software development costs[149]. - Net cash used in financing activities was $10.6 million, including a $5.6 million principal payment on the Term Loan due 2027[151]. - As of September 30, 2025, the company had $134.4 million outstanding under its Term Loan due 2027[153]. - The company had $135.0 million outstanding under the Term Loan due 2027, which matures on September 9, 2027[168]. Market and Risk Management - The company is exposed to market risks including changes in interest rates and consumer attitudes towards financing vehicle purchases, which are monitored as part of its risk management program[164]. - The company relies on three active insurance partners for a significant portion of its profit share and claims administration service fee revenue, indicating a concentration risk[166]. - The company has established policies to protect against market risks associated with economic conditions and consumer spending levels[165]. - The interest rates on the Term Loan are variable, exposing the company to fluctuations in earnings and cash flows[168]. Other Notable Events - The company signed 10 new contracts with automotive lenders in the three months ended September 30, 2025, compared to 21 in 2024, and 40 contracts in the nine months ended September 30, 2025, down from 45 in 2024[99]. - A one-time payment of $11.0 million was made in connection with the Allied Amendment, included in the non-recurring expenses for the three and nine months ended September 30, 2025[158]. - The Board of Directors authorized a Share Repurchase Program allowing the company to repurchase up to $25.0 million of its outstanding common stock until May 1, 2026[154].

Financial Performance - Total revenue for Q3 2025 was $24.2 million, up 3.0% from $23.5 million in Q3 2024[8] - Gross profit increased to $18.9 million in Q3 2025, compared to $17.3 million in Q3 2024[8] - The net loss for Q3 2025 was $7.6 million, contrasting with a net income of $1.4 million in Q3 2024[8] - Adjusted EBITDA rose to $5.6 million in Q3 2025, compared to $4.5 million in Q3 2024[8] - Total revenue for Q3 2025 was $24,169 million, a 2.9% increase from $23,476 million in Q3 2024[22] - Net loss for Q3 2025 was $7,569 million, compared to a net income of $1,437 million in Q3 2024[22] - Adjusted EBITDA for the nine months ended September 30, 2025, was $12,805 million, with an adjusted EBITDA margin of 17.3%[26] Loan Activity - Open Lending facilitated 23,880 certified loans in Q3 2025, a decrease of 12.5% from 27,435 certified loans in Q3 2024[8] - Credit unions and banks accounted for 89.8% of certified loans in Q3 2025, up from 79.5% in Q3 2024[9] - The company expects total certified loans for Q4 2025 to be between 21,500 and 23,500[7] Revenue per Loan - Average profit share revenue per certified loan decreased to $310 in Q3 2025 from $502 in Q3 2024[9] - Average program fee revenue per certified loan increased to $558 in Q3 2025 from $516 in Q3 2024[9] Operating Expenses - Operating expenses increased significantly to $26,552 million in Q3 2025, up from $15,483 million in Q3 2024, primarily due to higher general and administrative costs[22] - Research and development expenses for Q3 2025 were $2,050 million, significantly higher than $992 million in Q3 2024, indicating increased investment in innovation[22] Cash Flow - Cash and cash equivalents at the end of Q3 2025 were $233,729 million, down from $260,947 million at the end of Q3 2024[24] - The company reported a net cash used in operating activities of $8,644 million for the nine months ended September 30, 2025, compared to $20,976 million provided in the same period of 2024[24] Interest Expense - Interest expense for the nine months ended September 30, 2025, was $7,440 million, down from $8,468 million in the same period of 2024[24] Share Information - The weighted average diluted shares outstanding for Q3 2025 were 118,825 million, compared to 119,428 million in Q3 2024[22] New Initiatives - Open Lending launched ApexOne Auto, an advanced decisioning platform aimed at enhancing service capabilities for auto borrowers[3] One-time Payments - The company made a one-time payment of $11 million related to a reseller agreement, impacting non-GAAP financial measures[26]

Core Insights - Open Lending Corporation reported its third quarter financial results for the period ending September 30, 2025, highlighting a strategic shift towards enhanced underwriting standards and a conservative booking approach aimed at reducing profit share unit volatility [2][6]. Financial Performance - The company facilitated 23,880 certified loans in Q3 2025, a decrease from 27,435 certified loans in Q3 2024 [7]. - Total revenue for Q3 2025 was $24.2 million, up from $23.5 million in Q3 2024, driven by a $1.1 million increase in estimated profit share revenues from historic vintages [7]. - Gross profit increased to $18.9 million in Q3 2025 from $17.3 million in Q3 2024 [7]. - The net loss for Q3 2025 was $7.6 million, compared to a net income of $1.4 million in Q3 2024 [7]. - Adjusted EBITDA for Q3 2025 was $5.6 million, compared to $4.5 million in Q3 2024 [7]. Business Highlights - Credit unions and banks accounted for 89.8% of certified loans in Q3 2025, up from 79.5% in Q3 2024 [8]. - Average profit share revenue per certified loan decreased to $310 in Q3 2025 from $502 in Q3 2024, while average program fee revenue per certified loan increased to $558 from $516 [8]. - The company launched ApexOne Auto, an advanced decisioning platform aimed at enhancing service capabilities for a broader range of auto borrowers [2]. Fourth Quarter Outlook - For Q4 2025, Open Lending expects total certified loans to range between 21,500 and 23,500 [6].

Core Insights - Open Lending Corporation has launched ApexOne Auto, an advanced decisioning platform aimed at enhancing its capabilities in serving a diverse range of auto borrowers [1][3] - The platform integrates automation, data, and explainable intelligence to facilitate faster and more consistent credit decisions while ensuring effective risk management [2][3] Company Overview - Open Lending specializes in automotive lending enablement and risk analytics solutions for financial institutions, providing services such as loan analytics, risk-based pricing, and risk modeling [5] - The company has been operational for 25 years, focusing on empowering financial institutions to develop profitable auto loan portfolios with reduced risk [5] Product Features - ApexOne Auto is designed to integrate seamlessly with existing loan origination systems, enhancing the overall credit evaluation and performance management process for financial institutions [4] - Early adopters of the platform have reported positive experiences, particularly regarding its automation and integration capabilities [3][4] Market Context - The auto lending market is evolving, necessitating comprehensive solutions that can address the needs of various borrower profiles with speed and confidence [3] - The launch of ApexOne Auto aims to break through existing credit spectrum silos, providing a unified decisioning engine that supports growth while managing risk [3]