Triumph Financial(TFIN)

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Triumph Announces Schedule for Third Quarter 2025 Earnings Release and Conference Call
Globenewswire· 2025-10-03 20:07
DALLAS, Oct. 03, 2025 (GLOBE NEWSWIRE) -- Triumph Financial, Inc. (NYSE: TFIN) today announced that it expects to release its third quarter financial results and management commentary after the market closes on Wednesday, October 15, 2025. Upon filing, the financial results and commentary will be available on the Company’s IR website at ir.triumph.io. Aaron P. Graft, Vice Chairman and CEO, and Brad Voss, CFO, will review the financial results in a conference call with investors and analysts beginning at 9:3 ...
Triumph Expands Intelligence Offering for Brokers to Include Pricing, Performance and Capacity
Globenewswire· 2025-09-22 12:30
DALLAS, Sept. 22, 2025 (GLOBE NEWSWIRE) -- Triumph (NYSE: TFIN), a financial and technology company focused on payments, factoring, intelligence and banking solutions for the transportation industry, has launched its integrated Pricing and Performance Intelligence solution. This launch marks the first step in unifying pricing, performance and capacity sourcing into a single, trusted data solution for freight brokers. As part of the rollout, Triumph is introducing sourcing capabilities by embedding carrier c ...
Highway Launches the Trusted Freight Exchange, Powered by the Triumph Network
GlobeNewswire News Room· 2025-08-25 12:00
Core Insights - Highway has launched the Trusted Freight Exchange (TFX), a secure digital freight exchange designed exclusively for verified carriers and vetted brokers [1][2] - TFX integrates identity verification, compliance, pricing, and payment functionalities into a single platform, enhancing trust and efficiency in freight transactions [2][3] - The platform aims to eliminate issues such as impersonation, double brokering, fraud, non-payment, and poor visibility, establishing a reliable foundation for brokers and carriers [2][3] Company Overview - Highway specializes in Carrier Identity® solutions, helping freight brokers reduce fraud and streamline the digital booking process [4] - The company emphasizes transparency, trust, and truth, equipping brokers with necessary data to enhance service delivery and business growth [4] Industry Context - The launch of TFX represents a significant milestone in the freight industry, setting a new standard for identity-first infrastructure in freight transactions [3] - Triumph, a financial and technology company, collaborates with Highway to provide payment, factoring, and intelligence solutions that modernize freight transactions [5]
Triumph's True Value Is Hidden
Seeking Alpha· 2025-08-24 12:06
Core Insights - Triumph Financial (TFIN) operates as both a regional bank and a technology provider focused on trucking workflows, indicating a diversified business model that combines traditional banking with innovative tech solutions [1] Company Overview - The banking and factoring operations of Triumph Financial are described as mature and solidly profitable, suggesting a stable revenue base [1] - The company has expanded its offerings into technology, which may present growth opportunities in the trucking sector [1] Investment Philosophy - The approach to evaluating companies emphasizes viewing them as businesses rather than mere stock tickers, highlighting a fundamental analysis perspective [1] - The investment strategy is based on identifying mispriced opportunities in the market, which could indicate potential for significant returns [1]
Triumph Announces Transfer of Listing of Common and Preferred Stock to the New York Stock Exchange
Globenewswire· 2025-08-08 12:30
Core Points - Triumph Financial, Inc. is transferring its common and preferred stock listings from Nasdaq to the New York Stock Exchange (NYSE) and will also dual list on NYSE Texas [1][2] - The common stock ticker will remain TFIN, while the preferred stock ticker will change from TFINP to TFIN PR [1] - Trading on NYSE is expected to begin on or about August 19, 2025, and on NYSE Texas on or about August 20, 2025 [2] Company Overview - Triumph Financial is a financial and technology company focused on modernizing and simplifying freight transactions through payments, factoring, intelligence, and banking [4] - The company is headquartered in Dallas, Texas, and its portfolio includes brands such as Triumph, TBK Bank, and LoadPay [4] Leadership Statements - The CEO expressed honor in joining the NYSE and emphasized the potential for greater value for the company and its shareholders [3] - The NYSE Group's chief development officer welcomed Triumph Financial as a new member, highlighting the support for the company's growth and future success [3]
Triumph Financial(TFIN) - 2025 Q2 - Earnings Call Transcript
2025-07-17 15:32
Financial Data and Key Metrics Changes - The company reported a significant improvement in EBITDA margin, reaching approximately 14%, with expectations to exceed 40% in the long term [18][19] - Credit quality improved materially, with net charge-offs reported at less than one million dollars, indicating a strong quarter from a credit perspective [50][52] Business Line Data and Key Metrics Changes - The core transportation business experienced substantial revenue growth, with expectations for the intelligence segment to grow the fastest among the three transportation businesses [7][17] - The average annual contract value (ACV) for the GreenScreens acquisition increased from $37,000 to $80,000, reflecting strong customer engagement and integration efforts [15][45] Market Data and Key Metrics Changes - The company has captured nearly 70% of all freight transactions in the U.S., leveraging its extensive data network to enhance service offerings [16][46] - The factoring segment's average invoice size was influenced by market pressures and customer mix, with expectations for continued growth despite potential fluctuations [79][82] Company Strategy and Development Direction - The company emphasizes a value chain strategy, focusing on integrating data and services across its transportation businesses to enhance customer offerings [8][30] - The acquisition of GreenScreens is seen as a strategic move to bolster the intelligence segment, which is expected to grow rapidly due to its innovative data capabilities [12][45] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate competitive pressures and highlighted the importance of delivering value to customers [61][62] - The company aims to maintain flat expenses while growing revenue, ensuring a strong financial position amidst market challenges [112][114] Other Important Information - The company resolved a long-standing financial dispute with the United States Postal Service, which positively impacted financial results [6][7] - Investments in information security and infrastructure are prioritized to support business growth and protect against market risks [109][112] Q&A Session Summary Question: Early observations on the GreenScreens acquisition - Management noted that the integration is progressing well, with expectations for enhanced customer adoption and improved data models [11][12] Question: Expectations for EBITDA margin moving forward - Management anticipates continued improvement in EBITDA margin as revenues scale without proportional expense increases [19] Question: Average annual revenue impact from new accounts - Management indicated that while new accounts may dilute average revenue figures initially, mature accounts are generating significant revenue [27] Question: Competitive pushback from industry initiatives - Management acknowledged competitive pressures but emphasized that their offerings are driven by customer demand and are positioned to capture market share [30][35] Question: Timeline for breaking even on GreenScreens acquisition - Management expects to see a run rate of approximately $10 million in revenue from GreenScreens, with a focus on rapid growth in the intelligence segment [41][45] Question: Credit trends and expectations for provisions - Management confirmed that credit losses were typical for the quarter, with projections indicating a return to lower levels of credit loss expense [50][51] Question: Impact of DAT's acquisition on traditional factoring business - Management recognized DAT's move into the factoring space but remains confident in their competitive position within the market [60][62] Question: Growth in noninterest bearing deposits - Management detailed that over half of the growth in noninterest bearing deposits is attributed to mortgage warehouse deposits, with the remainder from payment float [96][97]
Triumph Financial(TFIN) - 2025 Q2 - Earnings Call Transcript
2025-07-17 15:30
Financial Data and Key Metrics Changes - The core transportation business experienced significant revenue growth, with credit quality improving materially [6][17] - The EBITDA margin for the payment segment improved to approximately 14%, with expectations to exceed 40% in the long term [19][20] Business Line Data and Key Metrics Changes - The GreenScreens acquisition is expected to contribute approximately $10 million in contracted annual recurring revenue (ARR), with an increase in average contract value from $37,000 to $80,000 [12][15][46] - The factoring segment is anticipated to continue growing, although invoice sizes may fluctuate due to a mix of larger customers [84][88] Market Data and Key Metrics Changes - The company reported a significant increase in noninterest-bearing deposits, with over half attributed to mortgage warehouse deposit growth and the remainder from payment float growth [101] Company Strategy and Development Direction - The company aims to leverage its data and technology to enhance its intelligence offerings, which are expected to grow faster than other transportation-related businesses [17][50] - The strategy includes integrating acquired data into existing models to improve service offerings and customer engagement [12][16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to monetize services and improve margins, emphasizing the importance of maintaining a strong credit quality [6][20] - The company is focused on delivering value to customers and expects to see continued growth in supply chain financing and other segments [94][96] Other Important Information - The resolution of the long-standing issue with the United States Postal Service has been viewed positively, reinforcing the company's commitment to delivering on promises [5][6] - Management highlighted the importance of investments in information security and infrastructure to support business growth and protect against risks [116][120] Q&A Session Summary Question: Early observations on the GreenScreens acquisition - Management noted that integration is underway, with expectations for improved customer engagement and increased average contract values [10][14][46] Question: Expectations for EBITDA margin moving forward - Management anticipates continued improvement in EBITDA margins as revenues scale without a proportional increase in expenses [19][20] Question: Average annual revenue impact from new accounts - The average revenue per account is expected to be around $700 or more, with new accounts initially diluting the average [26][28] Question: Competitive pushback from industry - Management acknowledged competition but emphasized that their offerings are driven by customer demand and are positioned to capture significant market share [30][36] Question: Timeline for breaking even on GreenScreens acquisition - Management indicated that they expect to grow the $10 million run rate faster than other transportation businesses, with a focus on leveraging Triumph's existing customer base [43][46] Question: Credit trends and charge-offs - Excluding impacts from USPS and acquired portfolios, charge-offs were less than $1 million, indicating strong credit performance [51][54] Question: Impact of DAT's acquisition on competition - Management recognized DAT's move into the factoring space but emphasized that competition is a natural part of the market [61][63] Question: Growth in net noninterest expense - Investments in shared services, particularly in information security, are aimed at supporting business growth and ensuring operational integrity [115][120]
Triumph Financial(TFIN) - 2025 Q2 - Earnings Call Presentation
2025-07-17 14:30
Company Overview - Triumph's market capitalization was $1.5 billion as of July 11, 2025 [9] - The company's revenue for the trailing twelve months (TTM) ending June 30, 2025, was $419 million [9] - Net income to common shareholders for the same period was $10.4 million [9] - The U S freight and logistics industry represents a $990 billion market based on gross freight revenue from U S trucking on primary shipments [14] Factoring - Triumph is the 2 transportation factor in the U S [17] - The factoring portfolio turns 10.4x annually [17, 36] - The average discount rate for factoring is 1.37% [17, 33] - Triumph purchased $11 billion in transportation accounts receivable over the last 12 months [33] Payments & Intelligence - Triumph handles payments for 41 of the top 100 freight brokers [24, 44] - Triumph disburses over $155 million every day [24] - Triumph's Network Engagement touches over 63% of all brokered freight [44, 54] - Triumph Intelligence processes $70 billion in annual, verified freight transaction data [28, 54]
Triumph Financial(TFIN) - 2025 Q2 - Quarterly Report
2025-07-16 20:16
[PART I - FINANCIAL INFORMATION](index=4&type=section&id=PART%20I%20-%20FINANCIAL%20INFORMATION) Presents the company's interim financial statements, management's discussion and analysis, and disclosures on market risks and internal controls [Item 1. Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) Presents the consolidated balance sheets, income statements, comprehensive income, changes in equity, cash flows, and detailed notes [Consolidated Balance Sheets](index=5&type=section&id=Consolidated%20Balance%20Sheets) Presents the Company's financial position as of June 30, 2025, and December 31, 2024, showing an increase in total assets, loans, and deposits | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | Change (in thousands) | | :-------------------------- | :----------------------------- | :----------------------------- | :-------------------- | | Total Assets | $6,494,748 | $5,948,975 | $545,773 | | Loans, net | $4,914,479 | $4,506,246 | $408,233 | | Total Deposits | $5,186,098 | $4,820,820 | $365,278 | | Total Stockholders' Equity | $912,382 | $890,919 | $21,463 | | Goodwill | $353,900 | $241,949 | $111,951 | [Consolidated Statements of Income](index=6&type=section&id=Consolidated%20Statements%20of%20Income) Details the Company's revenues and expenses for the three and six months ended June 30, 2025 and 2024, showing an increase in net income for Q2 2025 but a decrease for the six months ended June 30, 2025 compared to the prior year Net Income (Three Months Ended June 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | Change (in thousands) | % Change | | :--------------------------------- | :------------------ | :------------------ | :-------------------- | :------- | | Total interest income | $109,201 | $107,015 | $2,186 | 2.0% | | Total interest expense | $20,523 | $19,100 | $1,423 | 7.5% | | Net interest income | $88,678 | $87,915 | $763 | 0.9% | | Credit loss expense (benefit) | $(702) | $4,155 | $(4,857) | (116.9)% | | Net income | $4,420 | $2,747 | $1,673 | 60.9% | | Net income available to common stockholders | $3,618 | $1,945 | $1,673 | 86.0% | | Diluted EPS | $0.15 | $0.08 | $0.07 | 87.5% | Net Income (Six Months Ended June 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | Change (in thousands) | % Change | | :--------------------------------- | :------------------ | :------------------ | :-------------------- | :------- | | Total interest income | $211,471 | $208,962 | $2,509 | 1.2% | | Total interest expense | $38,410 | $35,012 | $3,398 | 9.7% | | Net interest income | $173,061 | $173,950 | $(889) | (0.5)% | | Credit loss expense (benefit) | $628 | $10,051 | $(9,423) | (93.8)% | | Net income | $4,437 | $6,905 | $(2,468) | (35.7)% | | Net income available to common stockholders | $2,834 | $5,302 | $(2,468) | (46.5)% | | Diluted EPS | $0.12 | $0.22 | $(0.10) | (45.5)% | [Consolidated Statements of Comprehensive Income](index=8&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income) Reports the Company's comprehensive income, including net income and other comprehensive income (loss) components, primarily unrealized gains/losses on securities, for the three and six months ended June 30, 2025 and 2024 Comprehensive Income (Three Months Ended June 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | Change (in thousands) | | :--------------------------------------- | :------------------ | :------------------ | :-------------------- | | Net income | $4,420 | $2,747 | $1,673 | | Change in unrealized gains (losses) on securities, net of tax | $774 | $(262) | $1,036 | | Comprehensive income (loss) | $5,194 | $2,485 | $2,709 | Comprehensive Income (Six Months Ended June 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | Change (in thousands) | | :--------------------------------------- | :------------------ | :------------------ | :-------------------- | | Net income | $4,437 | $6,905 | $(2,468) | | Change in unrealized gains (losses) on securities, net of tax | $470 | $(469) | $939 | | Comprehensive income (loss) | $4,907 | $6,436 | $(1,529) | [Consolidated Statements of Changes in Stockholders' Equity](index=9&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Stockholders'%20Equity) Details the changes in each component of stockholders' equity for the six months ended June 30, 2025 and 2024, including net income, stock-based compensation, and treasury stock transactions - Total Stockholders' Equity increased to **$912,382 thousand** at June 30, 2025, from **$890,919 thousand** at January 1, 2025[17](index=17&type=chunk) - Key drivers of change in stockholders' equity from January 1 to June 30, 2025, include issuance of common stock (**$12,732 thousand**), stock-based compensation (**$3,430 thousand**), net income (**$4,420 thousand**), other comprehensive income (**$774 thousand**), and net purchase of treasury stock (**$(2,099) thousand**)[17](index=17&type=chunk) [Consolidated Statements of Cash Flows](index=11&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Provides a breakdown of cash flows from operating, investing, and financing activities for the six months ended June 30, 2025 and 2024, showing a net decrease in cash and cash equivalents in 2025 Cash Flow Summary (Six Months Ended June 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | | :--------------------------------------- | :------------------ | :------------------ | | Net cash provided by (used in) operating activities | $6,179 | $11,126 | | Net cash provided by (used in) investing activities | $(566,791) | $(232,985) | | Net cash provided by (used in) financing activities | $512,841 | $435,887 | | Net increase (decrease) in cash and cash equivalents | $(47,771) | $214,028 | | Cash and cash equivalents at end of period | $282,346 | $500,663 | - Investing activities in 2025 included significant net cash paid for acquisitions (**$137,517 thousand**) and a substantial net change in loans (**$(406,345) thousand**)[21](index=21&type=chunk) - Financing activities in 2025 were primarily driven by a net increase in deposits (**$365,278 thousand**) and an increase in Federal Home Loan Bank advances (**$150,000 thousand**)[21](index=21&type=chunk) [Condensed Notes to Consolidated Financial Statements](index=13&type=section&id=Condensed%20Notes%20to%20Consolidated%20Financial%20Statements) Provides detailed disclosures and explanations for the financial statements, covering significant accounting policies, acquisitions, securities, loans, goodwill, regulatory matters, and segment information [NOTE 1 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES](index=13&type=section&id=NOTE%201%20%E2%80%94%20SUMMARY%20OF%20SIGNIFICANT%20ACCOUNTING%20POLICIES) Outlines the Company's nature of operations as a financial holding company offering banking, factoring, payments, and intelligence services, its basis of presentation, reportable segments, and the adoption of new accounting standards - Triumph Financial, Inc. is a financial holding company offering diversified banking, factoring, payments, and intelligence services through its subsidiaries, primarily TBK Bank, SSB[26](index=26&type=chunk) - The Company has four reportable segments: Banking, Factoring, Payments, and Intelligence[30](index=30&type=chunk) - The Intelligence segment, launched in Q4 2024, focuses on turning trucking data into actionable insights, supplemented by acquisitions of Isometric Technologies Inc. (Q4 2024) and Greenscreens AI, Inc. (Q2 2025)[35](index=35&type=chunk) - A USPS Settlement was reached on June 30, 2025, for **$47.5 million**, positively impacting pretax net income by **$12.4 million** for the three months and **$11.5 million** for the six months ended June 30, 2025[40](index=40&type=chunk)[42](index=42&type=chunk) [NOTE 2 — ACQUISITIONS AND DIVESTITURES](index=16&type=section&id=NOTE%202%20%E2%80%94%20ACQUISITIONS%20AND%20DIVESTITURES) Details the Company's acquisitions, specifically Greenscreens AI, Inc. in Q2 2025 and Isometric Technologies Inc. in Q4 2024, including consideration paid, assets acquired, and goodwill recognized Greenscreens AI, Inc. Acquisition (May 8, 2025) | Metric | Amount (in thousands) | | :-------------------------- | :-------------------- | | Cash paid | $139,118 | | Stock consideration | $12,732 | | Total consideration | $151,850 | | Goodwill recognized | $111,951 | | Customer relationship intangible assets | $36,380 | | Capitalized software intangible assets | $8,340 | - Goodwill from Greenscreens acquisition was allocated to Factoring (**$16,096 thousand**), Payments (**$15,425 thousand**), and Intelligence (**$80,430 thousand**) segments[46](index=46&type=chunk) Isometric Technologies Inc. Acquisition (December 1, 2024) | Metric | Amount (in thousands) | | :-------------------------- | :-------------------- | | Cash paid | $10,000 | | Goodwill recognized | $8,240 | | Capitalized software intangible assets | $1,680 | | Customer relationship intangible assets | $60 | | Trade name intangible assets | $20 | [NOTE 3 — SECURITIES](index=18&type=section&id=NOTE%203%20%E2%80%94%20SECURITIES) Provides a breakdown of the Company's equity and debt securities, including fair values, unrealized gains/losses, and allowance for credit losses, highlighting that unrealized losses on available-for-sale debt securities are due to noncredit-related factors Equity Securities with Readily Determinable Fair Values | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :--------------------------------------- | :----------------------------- | :----------------------------- | | Equity securities with readily determinable fair values | $4,526 | $4,445 | | Unrealized gains (losses) on equity securities held (Six Months Ended June 30, 2025) | $81 | $(66) | Available for Sale Debt Securities (June 30, 2025) | Metric | Fair Value (in thousands) | Gross Unrealized Gains (in thousands) | Gross Unrealized Losses (in thousands) | | :-------------------------- | :------------------------ | :------------------------------------ | :------------------------------------- | | Total available for sale securities | $392,275 | $1,329 | $(4,811) | - Management believes unrealized losses on available for sale debt securities are due to noncredit-related factors, and therefore, no allowance for credit losses was recorded at June 30, 2025[68](index=68&type=chunk) Held to Maturity Debt Securities (June 30, 2025) | Metric | Amortized Cost (in thousands) | Allowance for Credit Losses (in thousands) | | :-------------------------- | :---------------------------- | :------------------------------------- | | Total held to maturity securities, net of ACL | $1,782 | $1,399 | | Nonaccrual held to maturity securities | $1,913 | N/A | - During the three months ended March 31, 2025, the Company charged off one CLO fund investment of **$2,160 thousand**, which was fully reserved in a prior period, having no impact on credit loss expense[69](index=69&type=chunk) [NOTE 4 — LOANS AND ALLOWANCE FOR CREDIT LOSSES](index=22&type=section&id=NOTE%204%20%E2%80%94%20LOANS%20AND%20ALLOWANCE%20FOR%20CREDIT%20LOSSES) Details the Company's loan portfolio, including loans held for sale and investment, and the allowance for credit losses (ACL), noting changes in loan balances, credit quality, and modification activities Loans Held for Sale | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :-------------------------- | :----------------------------- | :----------------------------- | | Total loans held for sale | $6,066 | $1,172 | Loans Held for Investment (June 30, 2025) | Loan Type | Amortized Cost (in thousands) | % of Total | | :------------------ | :---------------------------- | :--------- | | Total loans held for investment | $4,968,659 | 100% | | Factored receivables | $1,401,377 | 28.2% | | Mortgage warehouse | $1,209,695 | 24.3% | Allowance for Credit Losses (ACL) on Loans | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :-------------------------- | :----------------------------- | :----------------------------- | | ACL ending balance | $38,691 | $40,714 | | ACL to total loans ratio | 0.78% | 0.90% | - Net charge-offs for the six months ended June 30, 2025, totaled **$13,601 thousand**, while credit loss expense was **$798 thousand**[87](index=87&type=chunk)[127](index=127&type=chunk) Nonperforming Loans | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :-------------------------- | :----------------------------- | :----------------------------- | | Nonaccrual loans | $54,616 | $90,023 | | Nonperforming factored receivables | $2,893 | $23,289 | | Total nonperforming loans | $57,509 | $113,312 | - Nonperforming loans decreased by **$55.8 million (49.2%)** from December 31, 2024, primarily due to payoffs, decreases in equipment finance and liquid credit relationships, and a **$19.4 million** reduction in the Misdirected Payments Receivable[125](index=125&type=chunk)[412](index=412&type=chunk) Loan Modifications to Borrowers Experiencing Financial Difficulty (Six Months Ended June 30, 2025) | Modification Type | Amortized Cost (in thousands) | % of Portfolio | | :---------------- | :---------------------------- | :------------- | | Term Extension | $134,268 | 17.8% | | Term Extension and Payment Delay | $302 | —% | | Payment Delay | $528 | —% | [NOTE 5 — GOODWILL AND INTANGIBLE ASSETS](index=39&type=section&id=NOTE%205%20%E2%80%94%20GOODWILL%20AND%20INTANGIBLE%20ASSETS) Provides a summary of goodwill and intangible assets, including changes due to acquisitions and amortization, showing a significant increase in goodwill and net carrying amount of intangible assets Goodwill and Intangible Assets | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :-------------------------- | :----------------------------- | :----------------------------- | | Goodwill | $353,900 | $241,949 | | Net Carrying Amount of Intangible Assets | $55,265 | $16,259 | - Acquired goodwill increased by **$111,951 thousand** and acquired intangible assets by **$44,844 thousand** during the six months ended June 30, 2025, primarily due to the Greenscreens acquisition[127](index=127&type=chunk) - Amortization of intangible assets totaled **$(5,800) thousand** for the six months ended June 30, 2025[127](index=127&type=chunk) [NOTE 6 — VARIABLE INTEREST ENTITIES](index=39&type=section&id=NOTE%206%20%E2%80%94%20VARIABLE%20INTEREST%20ENTITIES) Discusses the Company's investments in Collateralized Loan Obligation (CLO) funds, which are classified as held-to-maturity securities, and the conclusion that the Company is not the primary beneficiary, thus not requiring consolidation CLO Fund Investments | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :-------------------------- | :----------------------------- | :----------------------------- | | Net carrying amounts of CLO funds | $1,782 | $1,876 | - The Company concluded that it does not have the power to direct the activities that most significantly impact the CLO funds' economic performance, and therefore, is not required to consolidate them[131](index=131&type=chunk) [NOTE 7 — LEGAL CONTINGENCIES](index=41&type=section&id=NOTE%207%20%E2%80%94%20LEGAL%20CONTINGENCIES) States that various legal claims arise in the normal course of business, but management believes none will have a material effect on the Company's consolidated financial statements as of June 30, 2025 - Management believes that various legal claims arising in the normal course of business will have no material effect on the Company's consolidated financial statements as of June 30, 2025[132](index=132&type=chunk) [NOTE 8 — OFF-BALANCE SHEET LOAN COMMITMENTS](index=41&type=section&id=NOTE%208%20%E2%80%94%20OFF-BALANCE%20SHEET%20LOAN%20COMMITMENTS) Details the Company's off-balance sheet financial instruments, including commitments to extend credit and standby letters of credit, and the associated allowance for credit losses Off-Balance Sheet Financial Instruments | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :-------------------------- | :----------------------------- | :----------------------------- | | Unused lines of credit | $605,885 | $590,198 | | Standby letters of credit | $11,644 | $23,950 | | Mortgage warehouse commitments | $599,691 | $810,913 | Allowance for Credit Losses on Off-Balance Sheet Exposures | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :-------------------------- | :----------------------------- | :----------------------------- | | Allowance for credit losses | $2,481 | $2,701 | | Credit loss expense (benefit) (Six Months Ended June 30) | $(218) | $1,102 | [NOTE 9 — FAIR VALUE DISCLOSURES](index=43&type=section&id=NOTE%209%20%E2%80%94%20FAIR%20VALUE%20DISCLOSURES) Explains the Company's fair value measurement methodologies (Level 1, 2, 3 inputs) for assets and liabilities, including recurring measurements for securities and non-recurring for collateral-dependent loans, and details changes in indemnification and revenue share assets - Fair value measurements are categorized into Level 1 (quoted prices), Level 2 (observable inputs), and Level 3 (unobservable inputs)[141](index=141&type=chunk)[142](index=142&type=chunk) Assets Measured at Fair Value on a Recurring Basis (June 30, 2025) | Asset Type | Fair Value (in thousands) | Level | | :-------------------------- | :------------------------ | :---- | | Securities available for sale | $392,275 | Level 2 | | Equity securities with readily determinable fair values | $4,526 | Level 1 | | Loans held for sale | $6,066 | Level 2 | | Indemnification asset | $270 | Level 3 | | Revenue share asset | $2,344 | Level 3 | Collateral Dependent Loans Measured at Fair Value on a Non-Recurring Basis (June 30, 2025) | Loan Type | Fair Value (in thousands) | Level | | :------------------ | :------------------------ | :---- | | Commercial | $14,494 | Level 3 | | Factored receivables | $5,515 | Level 3 | | Total | $20,009 | Level 3 | [NOTE 10 — REGULATORY MATTERS](index=49&type=section&id=NOTE%2010%20%E2%80%94%20REGULATORY%20MATTERS) Details the Company's and TBK Bank's compliance with regulatory capital requirements, confirming they meet "well capitalized" status and outlining the impact of ASU 2016-13 transition adjustments - Triumph Financial, Inc. and TBK Bank, SSB meet all capital adequacy requirements and are categorized as "well capitalized" as of June 30, 2025, and December 31, 2024[161](index=161&type=chunk)[162](index=162&type=chunk) Triumph Financial, Inc. Capital Ratios (June 30, 2025) | Metric | Actual Ratio | Minimum for Capital Adequacy | | :--------------------------------------- | :----------- | :--------------------------- | | Total capital (to risk weighted assets) | 11.9% | 8.0% | | Tier 1 capital (to risk weighted assets) | 10.0% | 6.0% | | Common equity Tier 1 capital (to risk weighted assets) | 8.4% | 4.5% | | Tier 1 capital (to average assets) | 9.5% | 4.0% | - The temporary regulatory capital benefits from ASU 2016-13 were fully reversed after December 31, 2024[166](index=166&type=chunk) - The Company's and TBK Bank's risk-based capital exceeded the **2.5%** capital conservation buffer at June 30, 2025, and December 31, 2024[169](index=169&type=chunk) [NOTE 11 — STOCKHOLDERS' EQUITY](index=51&type=section&id=NOTE%2011%20%E2%80%94%20STOCKHOLDERS'%20EQUITY) Provides a summary of the Company's capital structure, including preferred stock and common stock details, such as shares authorized, issued, outstanding, par value, and dividend rates Preferred Stock Series C (June 30, 2025) | Metric | Value | | :-------------------------- | :---- | | Shares outstanding | 45,000 | | Liquidation preference amount | $45,000 thousand | | Dividend rate | 7.125% | Common Stock (June 30, 2025) | Metric | Value | | :-------------------------- | :---- | | Shares authorized | 50,000,000 | | Shares outstanding | 23,727,046 | | Par value per share | $0.01 | [NOTE 12 — STOCK BASED COMPENSATION](index=51&type=section&id=NOTE%2012%20%E2%80%94%20STOCK%20BASED%20COMPENSATION) Details the stock-based compensation expense and activity under the Company's Omnibus Incentive Plan and Employee Stock Purchase Plan, including restricted stock awards, restricted stock units, market-based performance stock units, and stock options Stock Based Compensation Expense (Six Months Ended June 30) | Year | Amount (in thousands) | | :--- | :-------------------- | | 2025 | $6,261 | | 2024 | $7,066 | - As of June 30, 2025, unrecognized compensation cost for nonvested Restricted Stock Units (RSUs) was **$8,187 thousand** (expected over **2.97 years**), for Market Based Performance Stock Units (PSUs) was **$16,012 thousand** (expected over **2.38 years**), and for nonvested stock options was **$3,240 thousand** (expected over **3.20 years**)[177](index=177&type=chunk)[181](index=181&type=chunk)[185](index=185&type=chunk) - Under the Employee Stock Purchase Plan (ESPP), **20,892 shares** were issued during the six months ended June 30, 2025, compared to **18,328 shares** in the same period of 2024[186](index=186&type=chunk) [NOTE 13 — EARNINGS PER SHARE](index=54&type=section&id=NOTE%2013%20%E2%80%94%20EARNINGS%20PER%20SHARE) Presents the basic and diluted earnings per common share calculations for the three and six months ended June 30, 2025 and 2024, along with the weighted average shares outstanding and dilutive effects of various equity instruments Earnings Per Common Share | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Basic EPS | $0.15 | $0.08 | $0.12 | $0.23 | | Diluted EPS | $0.15 | $0.08 | $0.12 | $0.22 | - Shares not considered in computing diluted earnings per common share because they were antidilutive for the three months ended June 30, 2025, included **199,859 stock options**, **5,171 restricted stock units**, and **56,311 market-based performance stock units**[189](index=189&type=chunk) [NOTE 14 — REVENUE FROM CONTRACTS WITH CUSTOMERS](index=55&type=section&id=NOTE%2014%20%E2%80%94%20REVENUE%20FROM%20CONTRACTS%20WITH%20CUSTOMERS) Describes the Company's revenue recognition policies under Topic 606 for its Banking, Factoring, and Payments segments, detailing how various fees and charges are recognized - The Banking and Factoring segments' revenue from contracts with customers under Topic 606 includes service charges on deposits, card income, net OREO gains/losses, fee income, and insurance commissions[191](index=191&type=chunk)[192](index=192&type=chunk) - The Payments segment earns transaction and network fees, which are subject to Topic 606 and recognized over time as services are rendered for providing access to its payments and audit platforms[195](index=195&type=chunk)[196](index=196&type=chunk)[197](index=197&type=chunk) Payments Segment Fee Income from External Customers (Six Months Ended June 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | % Change | | :---------------- | :------------------ | :------------------ | :------- | | Broker fee income | $11,621 | $8,507 | 36.6% | | Factor fee income | $2,226 | $2,591 | (14.1)% | | Other fee income | $257 | $154 | 66.9% | | Total fee income | $14,104 | $11,252 | 25.3% | [NOTE 15 — LESSOR OPERATING LEASES](index=58&type=section&id=NOTE%2015%20%E2%80%94%20LESSOR%20OPERATING%20LEASES) Reports the Company's revenue from lessor operating leases, disaggregated into fixed and variable payments, and amortization of intangibles Lessor Operating Lease Revenue (Six Months Ended June 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | % Change | | :--------------------------------------- | :------------------ | :------------------ | :------- | | Fixed payments | $682 | $1,095 | (37.7)% | | Variable payments | $436 | $553 | (21.2)% | | Amortization of intangibles included in lease income | $(38) | $(30) | 26.7% | | Total fee income | $1,080 | $1,618 | (33.3)% | [NOTE 16 — BUSINESS SEGMENT INFORMATION](index=58&type=section&id=NOTE%2016%20%E2%80%94%20BUSINESS%20SEGMENT%20INFORMATION) Provides detailed financial information for the Company's four reportable segments (Banking, Factoring, Payments, Intelligence) and a Corporate and Other category, outlining revenue, expenses, and intersegment allocations - The Company's reportable segments are Banking, Factoring, Payments, and Intelligence. The Intelligence segment was launched in Q4 2024, so no prior period comparative results are available[207](index=207&type=chunk) Segment Revenue Contribution (Six Months Ended June 30, 2025) | Segment | % of Total Segment Revenue | | :--------- | :------------------------- | | Banking | 59% | | Factoring | 30% | | Payments | 10% | | Intelligence | 1% | Net Income (Loss) Before Income Tax Expense by Segment (Six Months Ended June 30, 2025) | Segment | Amount (in thousands) | | :---------------- | :-------------------- | | Banking | $53,953 | | Factoring | $26,673 | | Payments | $(3,645) | | Intelligence | $(8,599) | | Corporate and Other | $(60,388) | [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=66&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Analyzes the company's financial performance, condition, and operational results for the reporting periods, including segment-specific details [Overview](index=66&type=section&id=Overview) Provides a high-level description of Triumph Financial, Inc. as a financial holding company, its principal subsidiary TBK Bank, and its diversified services across banking, factoring, payments, and intelligence segments, with a focus on the trucking ecosystem - Triumph Financial, Inc. is a financial holding company offering diversified banking, factoring, payments, and intelligence services, primarily focused on the for-hire trucking ecosystem[229](index=229&type=chunk)[236](index=236&type=chunk) - The Factoring business provides working capital to the trucking industry and launched its Factoring as a Service (FaaS) product in 2024[231](index=231&type=chunk) - The Payments business operates a network for the over-the-road trucking industry, connecting Brokers, Shippers, Factors, and Carriers, with a strategic shift towards fee revenue and the introduction of the LoadPay product[232](index=232&type=chunk)[234](index=234&type=chunk) - The Intelligence business, launched in Q4 2024, aims to turn trucking data into actionable insights, enhanced by the acquisitions of Isometric Technologies Inc. and Greenscreens AI, Inc[235](index=235&type=chunk) [Second Quarter 2025 Overview](index=68&type=section&id=Second%20Quarter%202025%20Overview) Presents key financial results and balance sheet highlights for the second quarter and six months ended June 30, 2025, noting increases in net income for the quarter but decreases for the six-month period, alongside growth in assets, loans, and deposits Net Income Available to Common Stockholders | Period | 2025 (in millions) | 2024 (in millions) | Change (in millions) | | :---------------- | :----------------- | :----------------- | :------------------- | | Q2 | $3.6 | $1.9 | $1.7 | | YTD Q2 | $2.8 | $5.3 | $(2.5) | Balance Sheet Highlights (June 30, 2025 vs. December 31, 2024) | Metric | June 30, 2025 (in billions) | December 31, 2024 (in billions) | Change (in billions) | | :-------------------------- | :-------------------------- | :-------------------------- | :------------------- | | Total Assets | $6.495 | $5.949 | $0.546 | | Gross Loans Held for Investment | $4.953 | $4.547 | $0.406 | | Total Deposits | $5.186 | $4.821 | $0.365 | - Gross loans held for investment increased by **$406.2 million**, with Factoring factored receivables up **13.7%** and Payments factored receivables up **32.0%**[240](index=240&type=chunk) - The Factoring segment purchased **$2.874 billion** in invoices in Q2 2025, while the Payments segment processed **8.5 million invoices** totaling **$10.081 billion**[243](index=243&type=chunk)[244](index=244&type=chunk) [2025 Items of Note](index=70&type=section&id=2025%20Items%20of%20Note) Highlights significant events in 2025, including the acquisition of Greenscreens AI, Inc. and the USPS Settlement, detailing their financial impacts - On May 8, 2025, the Company acquired Greenscreens AI, Inc. for **$139.1 million** in cash and **$12.7 million** of common stock, a pricing solution for the logistics industry[245](index=245&type=chunk) - A settlement was reached with the USPS on June 30, 2025, for **$47.5 million** to resolve litigation related to misdirected payments. This settlement had a **$12.4 million** positive impact on pretax net income for Q2 2025 and **$11.5 million** for the six months ended June 30, 2025[247](index=247&type=chunk)[248](index=248&type=chunk) - The **$47.5 million** USPS settlement proceeds were applied to various items, including **$11.5 million** to a large carrier, **$19.4 million** to relieve the Misdirected Payments Receivable, **$7.9 million** for legal expense recovery, and **$3.8 million** for recovery of previously charged-off advances[249](index=249&type=chunk) [2024 Items of Note](index=71&type=section&id=2024%20Items%20of%20Note) Covers notable events from 2024, specifically the acquisition of Isometric Technologies Inc. and the purchase of Triumph Financial's new headquarters - On December 1, 2024, the Company acquired Isometric Technologies Inc., a freight technology company, for **$10.0 million** in cash[250](index=250&type=chunk) - On March 20, 2024, the Company purchased a building in Dallas, TX, for **$54.6 million** to serve as its future headquarters[252](index=252&type=chunk) [Trucking transportation and factoring](index=71&type=section&id=Trucking%20transportation%20and%20factoring) Discusses the impact of freight market fluctuations on the Company's Factoring and Payments segments, noting softness in freight, decreased rates, and increased equipment finance delinquencies, while emphasizing the Company's focus on efficiency and technology - The freight market experienced softness during 2023, 2024, and the first half of 2025, characterized by falling volumes and excess capacity, leading to decreased average rates per mile[253](index=253&type=chunk) - This market softness has put pressure on the revenue of the Factoring segment and resulted in increased equipment finance delinquencies and loan modifications[253](index=253&type=chunk) - The Company is focusing on technology initiatives, including artificial intelligence capabilities, to enhance efficiency and profitability in its factoring segment[254](index=254&type=chunk) [Financial Highlights](index=72&type=section&id=Financial%20Highlights) Provides a comprehensive overview of the Company's financial performance and condition, including income statement data, per share data, performance ratios, balance sheet data, and asset quality ratios for the three and six months ended June 30, 2025 and 2024, and as of June 30, 2025 and December 31, 2024 Income Statement Data (Three Months Ended June 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | $ Change | % Change | | :--------------------------------- | :------------------ | :------------------ | :------- | :------- | | Net interest income | $88,678 | $87,915 | $763 | 0.9% | | Credit loss expense (benefit) | $(702) | $4,155 | $(4,857) | (116.9)% | | Noninterest income | $19,384 | $17,167 | $2,217 | 12.9% | | Net income available to common stockholders | $3,618 | $1,945 | $1,673 | 86.0% | | Diluted EPS | $0.15 | $0.08 | $0.07 | 87.5% | Income Statement Data (Six Months Ended June 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | $ Change | % Change | | :--------------------------------- | :------------------ | :------------------ | :------- | :------- | | Net interest income | $173,061 | $173,950 | $(889) | (0.5)% | | Credit loss expense (benefit) | $628 | $10,051 | $(9,423) | (93.8)% | | Noninterest income | $36,574 | $32,166 | $4,408 | 13.7% | | Net income available to common stockholders | $2,834 | $5,302 | $(2,468) | (46.5)% | | Diluted EPS | $0.12 | $0.22 | $(0.10) | (45.5)% | Balance Sheet Data (June 30, 2025 vs. Dec 31, 2024) | Metric | June 30, 2025 (in thousands) | Dec 31, 2024 (in thousands) | $ Change | % Change | | :--------------------------------- | :--------------------------- | :-------------------------- | :------- | :------- | | Total assets | $6,494,748 | $5,948,975 | $545,773 | 9.2% | | Loans held for investment, net | $4,914,479 | $4,506,246 | $408,233 | 9.1% | | Total deposits | $5,186,098 | $4,820,820 | $365,278 | 7.6% | | Total stockholders' equity | $912,382 | $890,919 | $21,463 | 2.4% | Asset Quality Ratios (June 30, 2025 vs. Dec 31, 2024) | Metric | June 30, 2025 | Dec 31, 2024 | Change | | :--------------------------------- | :------------ | :------------ | :----- | | Past due to total loans | 2.21% | 3.27% | (1.06)%| | Nonperforming loans to total loans | 1.20% | 2.49% | (1.29)%| | ACL to nonperforming loans | 65.02% | 35.93% | 29.09% | Capital Ratios (June 30, 2025 vs. Dec 31, 2024) | Metric | June 30, 2025 | Dec 31, 2024 | Change | | :--------------------------------- | :------------ | :------------ | :----- | | Tier 1 capital to risk-weighted assets | 9.98% | 13.06% | (3.08)%| | Total capital to risk-weighted assets | 11.95% | 15.23% | (3.28)%| [Results of Operations - Three months ended June 30, 2025 compared with three months ended June 30, 2024](index=77&type=section&id=Results%20of%20Operations%20-%20Three%20months%20ended%20June%2030%2C%202025%20compared%20with%20three%20months%20ended%20June%2030%2C%202024) Analyzes the Company's financial performance for the three months ended June 30, 2025, compared to the same period in 2024, detailing changes in net income, net interest income, credit loss expense, noninterest income, noninterest expense, and income taxes [Net Income](index=77&type=section&id=Net%20Income) Net income increased by $1.7 million (60.9%) for the three months ended June 30, 2025, primarily due to a significant benefit from credit loss expense and increased noninterest income, partially offset by higher interest expense Net Income (Three Months Ended June 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | $ Change | % Change | | :------- | :------------------ | :------------------ | :------- | :------- | | Net income | $4,420 | $2,747 | $1,673 | 60.9% | - Net income before income taxes increased by **$4.3 million (121.1%)** to **$7.9 million** in Q2 2025[261](index=261&type=chunk) [Net Interest Income](index=77&type=section&id=Net%20Interest%20Income) Net interest income saw a modest increase of 0.9% for Q2 2025, driven by higher interest income from increased average interest-earning assets, particularly loans, but partially offset by increased interest expense and a decrease in net interest margin Net Interest Income (Three Months Ended June 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | $ Change | % Change | | :---------------- | :------------------ | :------------------ | :------- | :------- | | Net interest income | $88,678 | $87,915 | $763 | 0.9% | - Total interest income increased by **$2.2 million (2.0%)**, driven by a **$533.3 million (10.7%)** increase in average interest-earning assets, including a **$529.6 million (12.6%)** increase in average total loans[267](index=267&type=chunk) - Total interest expense increased by **$1.4 million (7.5%)**, primarily due to a **$135.4 million (5.1%)** increase in average total interest-bearing deposits[268](index=268&type=chunk) - Net interest margin decreased by **64 basis points** to **6.43%** in Q2 2025 from **7.07%** in Q2 2024, mainly due to a **69 basis point** decrease in the yield on interest-earning assets[269](index=269&type=chunk)[270](index=270&type=chunk) [Credit Loss Expense](index=80&type=section&id=Credit%20Loss%20Expense) The Company recognized a credit loss benefit of $0.7 million in Q2 2025, a significant improvement from a $4.2 million expense in Q2 2024, primarily due to net recoveries (including the USPS Settlement) and favorable changes in loss drivers Total Credit Loss Expense (Benefit) (Three Months Ended June 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | $ Change | % Change | | :-------------------------- | :------------------ | :------------------ | :------- | :------- | | Total credit loss expense (benefit) | $(702) | $4,155 | $(4,857) | (116.9)% | - Credit loss expense on loans decreased by **$4.6 million (112.7%)** to a benefit of **$(516) thousand** in Q2 2025[278](index=278&type=chunk) - The Company recorded a net recovery of **$3.0 million** in Q2 2025, including a **$3.8 million** recovery from the USPS Settlement, compared to net charge-offs of **$2.7 million** in Q2 2024[280](index=280&type=chunk) - The Allowance for Credit Losses (ACL) on loans was **$38.7 million** at June 30, 2025, representing an ACL to total loans ratio of **0.78%**[278](index=278&type=chunk) [Noninterest Income](index=82&type=section&id=Noninterest%20Income) Noninterest income increased by $2.2 million (12.9%) in Q2 2025, mainly driven by higher fee income from the Payments and Intelligence segments, partially offset by decreases in other noninterest income Total Noninterest Income (Three Months Ended June 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | $ Change | % Change | | :---------------- | :------------------ | :------------------ | :------- | :------- | | Total noninterest income | $19,384 | $17,167 | $2,217 | 12.9% | - Fee income increased by **$4.2 million**, driven by a **$1.8 million** increase from the Payments segment, a **$1.6 million** increase from the Intelligence segment (due to Greenscreens acquisition), and a **$0.7 million** increase from insurance services[285](index=285&type=chunk) - Other noninterest income decreased by **$1.6 million**, primarily due to a **$0.5 million** gain on equity securities in Q2 2024 not recurring and a **$1.4 million** decrease in rental income, partially offset by a **$0.4 million** increase in bank-owned life insurance income[285](index=285&type=chunk) [Noninterest Expense](index=82&type=section&id=Noninterest%20Expense) Noninterest expense increased by $3.5 million (3.6%) in Q2 2025, primarily due to higher salaries and employee benefits, software amortization, and other expenses (including litigation settlement and lease termination payments), partially offset by a significant decrease in professional fees due to the USPS Settlement recovery Total Noninterest Expense (Three Months Ended June 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | $ Change | % Change | | :---------------- | :------------------ | :------------------ | :------- | :------- | | Total noninterest expense | $100,840 | $97,343 | $3,497 | 3.6% | - Salaries and employee benefits increased by **$3.9 million (6.9%)**, driven by higher salaries, payroll taxes, bonuses, and commissions[284](index=284&type=chunk) - Professional fees decreased by **$4.9 million (107.0%)**, primarily due to a **$7.4 million** recovery of legal fees from the USPS Settlement, partially offset by **$3.0 million** in Greenscreens acquisition-related fees[289](index=289&type=chunk) - Software amortization increased by **$1.5 million (111.1%)** due to additional software assets coming online[289](index=289&type=chunk) - Other noninterest expense increased by **$4.7 million (84.9%)**, including a **$2.0 million** litigation settlement and **$1.8 million** in lease termination payments[289](index=289&type=chunk) [Income Taxes](index=83&type=section&id=Income%20Taxes) Income tax expense increased significantly in Q2 2025, with the effective tax rate rising to 44% due to factors like limited stock-based compensation deductibility, higher state tax rates, and disallowed acquisition costs Income Tax Expense (Three Months Ended June 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | $ Change | % Change | | :---------------- | :------------------ | :------------------ | :------- | :------- | | Income tax expense | $3,504 | $837 | $2,667 | 318.6% | - The effective tax rate was **44%** in Q2 2025, up from **23%** in Q2 2024, impacted by limited restricted stock-based compensation deductibility, higher state tax rates, and disallowed Greenscreens acquisition costs[287](index=287&type=chunk) [Operating Segment Results](index=83&type=section&id=Operating%20Segment%20Results) Provides a breakdown of operating results by segment (Banking, Factoring, Payments, Intelligence, and Corporate & Other) for the three months ended June 30, 2025 and 2024, highlighting segment-specific revenue, expenses, and profitability Net Income (Loss) Before Income Tax Expense by Segment (Three Months Ended June 30) | Segment | 2025 (in thousands) | 2024 (in thousands) | $ Change | % Change | | :---------------- | :------------------ | :------------------ | :------- | :------- | | Banking | $26,374 | $30,285 | $(3,911) | (12.9)% | | Factoring | $19,754 | $4,627 | $15,127 | 326.9% | | Payments | $(654) | $(3,973) | $3,319 | 83.5% | | Intelligence | $(5,986) | $0 | $(5,986) | N/A | | Corporate and Other | $(31,564) | $(27,355) | $(4,209) | (15.4)% | [Banking Segment](index=88&type=section&id=Banking%20Segment) The Banking segment's operating income decreased by 12.9% in Q2 2025, primarily due to decreased net interest income from lower yields despite increased loan balances, and higher interest expense, partially offset by increased noninterest income and decreased noninterest expense Banking Segment Operating Income (Three Months Ended June 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | $ Change | % Change | | :---------------- | :------------------ | :------------------ | :------- | :------- | | Operating income (loss) | $26,374 | $30,285 | $(3,911) | (12.9)% | - Net interest income decreased by **$5.0 million (8.7%)**, primarily due to decreased yields despite an **11.4%** increase in average loans in the Banking segment[299](index=299&type=chunk) - Interest expense increased by **$2.1 million (12.6%)**, driven by higher average interest-bearing liabilities and increased usage of higher-priced brokered time deposits[300](index=300&type=chunk) - Total Banking loans increased by **$208.9 million (6.3%)** to **$3.549 billion** as of June 30, 2025[305](index=305&type=chunk) [Factoring Segment](index=90&type=section&id=Factoring%20Segment) The Factoring segment's operating income significantly increased by 326.9% in Q2 2025, driven by higher net interest income from increased average net funds employed and a substantial credit loss benefit (including the USPS Settlement recovery), alongside decreased noninterest expense due to legal fee recovery Factoring Segment Operating Income (Three Months Ended June 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | $ Change | % Change | | :---------------- | :------------------ | :------------------ | :------- | :------- | | Net income (loss) before income tax expense | $19,754 | $4,627 | $15,127 | 326.9% | - Net interest income increased by **$3.6 million (14.5%)** to **$28.8 million**, driven by a **22.0%** increase in overall average net funds employed[310](index=310&type=chunk) - Credit loss expense was a benefit of **$(2.9) million** in Q2 2025, a **234.0%** decrease from Q2 2024, including a **$3.8 million** recovery from the USPS Settlement[311](index=311&type=chunk) - Total noninterest expense decreased by **$6.6 million (31.7%)**, primarily due to a **$7.4 million** recovery of previously expensed legal fees associated with the USPS Settlement[306](index=306&type=chunk)[313](index=313&type=chunk) - Accounts receivable purchased increased by **13.0%** to **$2.874 billion**, while the average invoice size decreased by **4.6%** to **$1,693** in Q2 2025[308](index=308&type=chunk)[309](index=309&type=chunk) [Payments Segment](index=93&type=section&id=Payments%20Segment) The Payments segment's operating loss decreased by 83.5% in Q2 2025, driven by increased net interest income from higher average interest-earning assets and increased noninterest income from payment and audit fees, while noninterest expense remained relatively flat Payments Segment Operating Income (Loss) (Three Months Ended June 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | $ Change | % Change | | :---------------- | :------------------ | :------------------ | :------- | :------- | | Net income (loss) before income tax expense | $(654) | $(3,973) | $3,319 | 83.5% | - Net interest income increased by **$1.4 million (18.0%)** to **$9.1 million**, due to increased average balance of interest-earning assets and intersegment interest allocation[318](index=318&type=chunk) - Noninterest income increased by **$1.9 million (31.7%)** to **$7.7 million**, driven by a **$1.8 million** increase in payment and audit fees[319](index=319&type=chunk) - The number of invoices processed increased by **40.2%** to **8.5 million**, and the amount of payments processed increased by **50.7%** to **$10.081 billion** in Q2 2025[316](index=316&type=chunk) [Intelligence Segment](index=96&type=section&id=Intelligence%20Segment) The Intelligence segment reported an operating loss of $6.0 million in Q2 2025, with the majority of expenses attributed to salaries and benefits and professional fees, largely due to the Greenscreens acquisition. This segment was launched in Q4 2024, so no comparative prior period data is available - The Intelligence segment reported an operating loss of **$(5,986) thousand** for Q2 2025[322](index=322&type=chunk) - The majority of expenses were salaries and benefits (**$3,234 thousand**) and professional fees (**$2,995 thousand**), with professional fees largely related to the Greenscreens acquisition[322](index=322&type=chunk) - Noninterest income for the Intelligence segment was **$1,724 thousand** in Q2 2025[322](index=322&type=chunk) [Corporate and Other](index=97&type=section&id=Corporate%20and%20Other) The Corporate and Other category reported an increased operating loss of $31.6 million in Q2 2025, driven by higher noninterest expense (salaries, professional fees, other expenses including lease termination payments) and decreased noninterest income (rental income), partially offset by decreased interest expense Corporate and Other Operating Loss (Three Months Ended June 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | $ Change | % Change | | :---------------- | :------------------ | :------------------ | :------- | :------- | | Net income (loss) before income tax expense | $(31,564) | $(27,355) | $(4,209) | (15.4)% | - Total noninterest expense increased by **$3.5 million (13.0%)**, driven by increases in salaries and benefits (**$1.3 million**), professional fees (**$1.1 million**), and other noninterest expense (**$1.9 million**, including **$1.8 million** in lease termination payments)[324](index=324&type=chunk) - Noninterest income decreased by **$1.5 million (91.9%)**, primarily due to a **$1.4 million** decrease in rental income[323](index=323&type=chunk)[324](index=324&type=chunk) - Interest expense decreased by **$0.7 million (28.9%)** due to decreased average borrowings[323](index=323&type=chunk)[324](index=324&type=chunk) [Results of Operations - Six months ended June 30, 2025 compared with six months ended June 30, 2024](index=97&type=section&id=Results%20of%20Operations%20-%20Six%20months%20ended%20June%2030%2C%202025%20compared%20with%20six%20months%20ended%20June%2030%2C%202024) Analyzes the Company's financial performance for the six months ended June 30, 2025, compared to the same period in 2024, detailing changes in net income, net interest income, credit loss expense, noninterest income, noninterest expense, and income taxes [Net Income](index=98&type=section&id=Net%20Income) Net income decreased by $2.5 million (35.7%) for the six months ended June 30, 2025, primarily due to higher interest expense, increased noninterest expense, and a higher income tax expense, despite a significant decrease in credit loss expense Net Income (Six Months Ended June 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | $ Change | % Change | | :------- | :------------------ | :------------------ | :------- | :------- | | Net income | $4,437 | $6,905 | $(2,468) | (35.7)% | - Net income before income taxes decreased by **$0.4 million (4.3%)** to **$8.0 million** for the six months ended June 30, 2025[326](index=326&type=chunk) [Net Interest Income](index=98&type=section&id=Net%20Interest%20Income) Net interest income saw a slight decrease of 0.5% for the six months ended June 30, 2025, as increased interest income from higher average interest-earning assets was largely offset by increased interest expense and a decline in net interest margin Net Interest Income (Six Months Ended June 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | $ Change | % Change | | :---------------- | :------------------ | :------------------ | :------- | :------- | | Net interest income | $173,061 | $173,950 | $(889) | (0.5)% | - Total interest income increased by **$2.5 million (1.2%)**, driven by a **$530.1 million (10.9%)** increase in average interest-earning assets, including a **$478.7 million (11.6%)** increase in average total loans[335](index=335&type=chunk) - Total interest expense increased by **$3.4 million (9.7%)**, primarily due to a **$205.2 million (8.0%)** increase in average total interest-bearing deposits[336](index=336&type=chunk) - Net interest margin decreased by **72 basis points** to **6.46%** for the six months ended June 30, 2025, from **7.18%** in the prior year, mainly due to a **74 basis point** decrease in the yield on interest-earning assets[337](index=337&type=chunk)[338](index=338&type=chunk) [Credit Loss Expense](index=102&type=section&id=Credit%20Loss%20Expense) Credit loss expense significantly decreased by 93.8% for the six months ended June 30, 2025, primarily due to a decrease in required specific reserves and net charge-offs (including the USPS Settlement recovery), partially offset by changes in loan portfolio volume and mix Total Credit Loss Expense (Six Months Ended June 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | $ Change | % Change | | :---------------- | :------------------ | :------------------ | :------- | :------- | | Total credit loss expense | $628 | $10,051 | $(9,423) | (93.8)% | - Credit loss expense on loans decreased by **$8.2 million (91.1%)** to **$798 thousand** for the six months ended June 30, 2025[346](index=346&type=chunk) - Net charge-offs on loans for the six months ended June 30, 2025, were **$13,601 thousand**, including a **$3.8 million** recovery from the USPS Settlement[348](index=348&type=chunk)[127](index=127&type=chunk) - A **$4.1 million** decrease in required specific reserves contributed to the lower credit loss expense[348](index=348&type=chunk) [Noninterest Income](index=104&type=section&id=Noninterest%20Income) Noninterest income increased by $4.4 million (13.7%) for the six months ended June 30, 2025, driven by higher fee income from the Payments and Intelligence segments, partially offset by decreased insurance commissions and rental income Total Noninterest Income (Six Months Ended June 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | $ Change | % Change | | :---------------- | :------------------ | :------------------ | :------- | :------- | | Total noninterest income | $36,574 | $32,166 | $4,408 | 13.7% | - Fee income increased by **$4.7 million (27.1%)**, driven by the Payments segment (**$2.9 million**), Intelligence segment (**$1.9 million** from Greenscreens acquisition), and insurance services (**$0.8 million**)[352](index=352&type=chunk) - Insurance commissions decreased by **$0.5 million (17.6%)** due to lower volumes of processed policies[352](index=352&type=chunk) - Other noninterest income increased by **$0.3 million (7.2%)**, primarily due to higher BOLI income and gains on business asset sales, partially offset by lower revenue share asset gains and rental income[352](index=352&type=chunk) [Noninterest Expense](index=104&type=section&id=Noninterest%20Expense) Noninterest expense increased by $13.3 million (7.1%) for the six months ended June 30, 2025, primarily due to higher salaries and employee benefits, software amortization, and other expenses (including litigation settlement and lease termination payments), partially offset by a decrease in professional fees due to the USPS Settlement recovery Total Noninterest Expense (Six Months Ended June 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | $ Change | % Change | | :---------------- | :------------------ | :------------------ | :------- | :------- | | Total noninterest expense | $201,013 | $187,714 | $13,299 | 7.1% | - Salaries and employee benefits increased by **$8.4 million (7.6%)**, driven by higher salaries, payroll tax, bonuses, commissions, and workforce growth[357](index=357&type=chunk) - Professional fees decreased by **$2.4 million (29.1%)**, primarily due to a **$6.5 million** recovery of legal fees from the USPS Settlement, partially offset by **$4.0 million** in Greenscreens acquisition-related fees[357](index=357&type=chunk) - Software amortization increased by **$2.3 million (91.9%)** due to additional software assets coming online[357](index=357&type=chunk) - Other noninterest expense increased by **$5.4 million (48.2%)**, including a **$2.0 million** litigation settlement and **$2.4 million** in lease termination payments[357](index=357&type=chunk) [Income Taxes](index=105&type=section&id=Income%20Taxes) Income tax expense increased significantly for the six months ended June 30, 2025, with the effective tax rate rising to 44% due to factors like limited stock-based compensation deductibility, higher state tax rates, and disallowed acquisition costs Income Tax Expense (Six Months Ended June 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | $ Change | % Change | | :---------------- | :------------------ | :------------------ | :------- | :------- | | Income tax expense | $3,557 | $1,446 | $2,111 | 146.0% | - The effective tax rate was **44%** for the six months ended June 30, 2025, up from **17%** in the prior year, impacted by limited restricted stock-based compensation deductibility, higher state tax rates, and disallowed Greenscreens acquisition costs[355](index=355&type=chunk) [Operating Segment Results](index=105&type=section&id=Operating%20Segment%20Results) Provides a breakdown of operating results by segment (Banking, Factoring, Payments, Intelligence, and Corporate & Other) for the six months ended June 30, 2025 and 2024, highlighting segment-specific revenue, expenses, and profitability Net Income (Loss) Before Income Tax Expense by Segment (Six Months Ended June 30) | Segment | 2025 (in thousands) | 2024 (in thousands) | $ Change | % Change | | :---------------- | :------------------ | :------------------ | :------- | :------- | | Banking | $53,953 | $58,460 | $(4,507) | (7.7)% | | Factoring | $26,673 | $11,718 | $14,955 | 127.6% | | Payments | $(3,645) | $(8,176) | $4,531 | 55.4% | | Intelligence | $(8,599) | $0 | $(8,599) | N/A | | Corporate and Other | $(60,388) | $(53,651) | $(6,737) | (12.6)% | [Banking Segment](index=111&type=section&id=Banking%20Segment) The Banking segment's operating income decreased by 7.7% for the six months ended June 30, 2025, primarily due to decreased net interest income from lower yields despite increased loan balances, and higher interest expense, partially offset by a significant decrease in credit loss expense and increased noninterest income Banking Segment Operating Income (Six Months Ended June 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | $ Change | % Change | | :---------------- | :------------------ | :------------------ | :------- | :------- | | Net income (loss) before income tax expense | $53,953 | $58,460 | $(4,507) | (7.7)% | - Net interest income decreased by **$10.2 million (8.9%)**, primarily due to decreased yields despite a **10.9%** increase in average loans[369](index=369&type=chunk) - Interest expense increased by **$4.8 million (15.9%)**, driven by higher average balances in interest-bearing liabilities and increased usage of brokered time deposits[370](index=370&type=chunk) - Credit loss expense decreased by **$3.8 million (58.0%)** to **$2.7 million**, driven by decreased specific reserves and favorable changes in loss drivers[371](index=371&type=chunk) - Total Banking loans increased by **$208.9 million (6.3%)** to **$3.549 billion** as of June 30, 2025[375](index=375&type=chunk) [Factoring Segment](index=114&type=section&id=Factoring%20Segment) The Factoring segment's operating income significantly increased by 127.6% for the six months ended June 30, 2025, driven by higher net interest income from increased average net funds employed and a substantial credit loss benefit (including the USPS Settlement recovery), alongside decreased noninterest expense due to legal fee recovery Factoring Segment Operating Income (Six Months Ended June 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | $ Change | % Change | | :---------------- | :------------------ | :------------------ | :------- | :------- | | Net income (loss) before income tax expense | $26,673 | $11,718 | $14,955 | 127.6% | - Net interest income increased by **$5.5 million (11.2%)** to **$54.4 million**, driven by a **17.6%** increase in overall average net funds employed[379](index=379&type=chunk) - Credit loss expense was a benefit of **$(2.4) million** in YTD Q2 2025, a **166.7%** decrease from YTD Q2 2024, including a **$3.8 million** recovery from the USPS Settlement[381](index=381&type=chunk) - Total noninterest expense decreased by **$4.9 million (12.4%)**, primarily due to a **$6.5 million** recovery of previously expensed legal fees associated with the USPS Settlement[376](index=376&type=chunk)[383](index=383&type=chunk) - Accounts receivable purchased increased by **11.4%** to **$5.581 billion**, while the average invoice size decreased
Triumph Financial(TFIN) - 2025 Q2 - Quarterly Results
2025-07-16 20:09
[Shareholder Letter & Q2 2025 Overview](index=1&type=section&id=Shareholder%20Letter) This section provides an overview of Q2 2025 financial performance, strategic initiatives, and the company's integrated value chain of transportation offerings [Q2 2025 Financial Highlights](index=1&type=section&id=Q2%202025%20Financial%20Highlights) For the second quarter of 2025, the company reported a net income of $3.6 million, or $0.15 per diluted share, significantly influenced by non-core items, primarily a substantial gain from a litigation settlement with the U.S. Postal Service (USPS) impacting pre-tax operating income by $12.36 million Q2 2025 Key Financials | Metric | Value | | :--- | :--- | | Net Income to Common Stockholders | $3.6 million | | Diluted EPS | $0.15 | Summary of Non-Core Items (Q2 2025) | Category | Description | $ Impact | | :--- | :--- | :--- | | **USPS Settlement** | Net impact of USPS settlement | **$12,362,000** | | Interest income | USPS - Collection of fees | $1,213,000 | | Noninterest expense | USPS - Recovery of legal expense | $7,376,000 | | Credit loss expense | USPS - ACL Recovery | $3,773,000 | | **Other Non-Recurring Items** | Net impact of other non-recurring items | **$(7,091,000)** | | Noninterest expense | Greenscreens transaction costs | $(3,024,000) | | Noninterest expense | Other Legal Settlements | $(2,000,000) | | Noninterest expense | New HQ termination fees and accelerated amortization | $(2,067,000) | | **Total Pre-tax Impact** | Pre-tax operating income impact | **$5,271,000** | - The company recovered the full **$19.4 million** receivable from the USPS, which had been carried as a non-performing asset for nearly five years, plus additional amounts covering legal expenses[2](index=2&type=chunk) - The company acquired a **$23.4 million** non-performing equipment finance loan at a significant discount, with an initial **$10.8 million** charged-off with no impact to credit loss expense, and the remaining discount expected to be accreted as income in future quarters[4](index=4&type=chunk) [Key Thoughts for the Quarter](index=1&type=section&id=Key%20Thoughts%20for%20the%20Quarter) Despite a stagnant freight cycle, Triumph is demonstrating progress through revenue growth and operational efficiency initiatives, including 15.2% growth in transportation revenue, the acquisition of Greenscreens, a new FaaS partnership with RXO, and significant momentum in LoadPay account openings, reaching over 2,700 accounts by mid-July - The company is focused on operating within the current soft market conditions and is implementing operational efficiency improvements, with more details to be shared in Q3[7](index=7&type=chunk) - Annualized transportation revenue grew from **$206 million** last quarter to **$237 million** this quarter (excluding USPS settlement impact), with organic growth at **11.3%** after adjusting for the Greenscreens acquisition[9](index=9&type=chunk) - RXO, a major freight broker, went live on the factoring-as-a-service (FaaS) platform and became the second LoadPay distribution partner[9](index=9&type=chunk) - LoadPay accounts grew rapidly, reaching **2,000** on June 10 and **2,729** by July 14, with the company expecting growth to accelerate with increased market awareness and the RXO partnership[9](index=9&type=chunk) - The company's transportation network now engages with **$70 billion** of unique annualized volume, and its Payments Network serves **66 of the top 100** US freight brokers[9](index=9&type=chunk) [A Value Chain of Five Offerings](index=3&type=section&id=A%20Value%20Chain%20of%20Five%20Offerings) Triumph outlines its integrated value chain of five core transportation offerings: Audit, Payments, Liquidity Solutions, Digital Banking (LoadPay), and a Pricing & Performance Engine, creating a symbiotic ecosystem that generates network effects and a defensible competitive advantage - The company's strategy is to build a value chain where each service offering logically leads to and enhances the others, creating a competitive advantage and customer stickiness[10](index=10&type=chunk)[11](index=11&type=chunk)[13](index=13&type=chunk) - 1. **Audit:** Audits more brokered freight than any known competitor, leveraging AI for automation, with the NextGen Audit product serving as a key tool[14](index=14&type=chunk) - 2. **Payments:** Disburses about **$200 million** daily, making more payments to U.S. truckers than anyone else, with significant opportunities for cross-selling with audit services[14](index=14&type=chunk) - 3. **Liquidity Solutions:** Offers a broad suite including factoring, FaaS, and supply chain finance, with a total balance sheet exposure of **$1.4 billion** and room to grow[14](index=14&type=chunk) - 4. **Digital Banking for Truckers (LoadPay):** A purpose-built digital bank account for truckers offering 24/7 instant funding, targeting **5,000-10,000** accounts by year-end, with **2,729** accounts as of July 14, 2025 (a **251%** increase over Q1)[14](index=14&type=chunk)[15](index=15&type=chunk) - 5. **Pricing & Performance Engine:** A unique offering built on **$70 billion** in unique volume from audit, payment, and factoring data, providing real-time pricing, market data, and performance metrics, with prediction models claimed to be **2x** more accurate than competitors[18](index=18&type=chunk) [Segment Performance Analysis](index=9&type=section&id=Segment%20Performance%20Analysis) This section analyzes the financial performance of the company's key operating segments: Payments, Factoring, Intelligence, and Banking, highlighting revenue growth, profitability, and strategic initiatives within each [Payments](index=9&type=section&id=Payments) The Payments segment demonstrated strong growth, with revenue increasing 13.5% quarter-over-quarter to an annualized $68.9 million, driven by a 14.8% increase in payment volume and significant growth in LoadPay accounts, leading to a dramatic EBITDA margin improvement to 13.9% Payments Segment Performance (Q2 2025 vs Q1 2025) | Metric | Q2 2025 | Q1 2025 | Q/Q Change | | :--- | :--- | :--- | :--- | | Total Revenue | $17.2M | $15.2M | +13.5% | | Payment Volume | $10.1B | $8.8B | +14.8% | | EBITDA Margin | 13.9% | (0.1)% | +14.0 p.p. | | LoadPay Accounts | 2,367 | 778 | +205.7% | | LoadPay Funding | $22.2M | $5.0M | +345.5% | - Network engagement in brokered freight increased to **63.3%** from **50.4%** in the prior quarter, partly due to the addition of Greenscreens volume[31](index=31&type=chunk) - The company is focused on three levers for revenue growth: consistently pricing existing customers, growing the customer base, and cross-selling Audit (NGA) and Payments services[34](index=34&type=chunk)[40](index=40&type=chunk) - The percentage of payments for which a fee was charged increased from **24.0%** to **28.5%** in Q2, contributing to a **$1.2 million** increase in fee revenue[37](index=37&type=chunk) [Factoring](index=14&type=section&id=Factoring) The Factoring segment's operating income was significantly boosted by a one-time USPS litigation settlement, resulting in a 48.5% operating margin, while still showing strong underlying growth with a 13.4% QoQ increase in invoice volume and a 6.1% increase in purchased volume, driven by technology enhancements and a strategic shift to Net Funds Employed (NFE) pricing Factoring Segment Performance (Q2 2025 vs Q1 2025) | Metric | Q2 2025 | Q1 2025 | Q/Q Change | | :--- | :--- | :--- | :--- | | Operating Margin | 48.46% | 19.24% | +29.22 p.p. | | Purchased Volume | $2.87B | $2.71B | +6.1% | | Invoice Volume | 1,697,851 | 1,497,644 | +13.4% | | Avg. Trans. Invoice Size | $1,663 | $1,769 | -6.0% | - Operating income was impacted by a net **$10.4 million** from non-core/non-recurring items, primarily the USPS settlement[51](index=51&type=chunk) - The instant decision model is active on the entire portfolio (except SCF), creating a **30% - 45%** revenue growth opportunity before adding material expense[52](index=52&type=chunk) - The segment added **328** new customers in Q2, and the shift to NFE pricing continues, with **22%** of recourse customers now on this model, up from **4%** in 2022[59](index=59&type=chunk)[61](index=61&type=chunk) [Intelligence](index=17&type=section&id=Intelligence) The Intelligence segment, bolstered by the acquisition of Greenscreens on May 8, closed the quarter on a $9.7 million annualized revenue run rate, with a near-term focus on integrating Triumph's rich data into the ISO and Greenscreens models to enhance the accuracy and coverage of its pricing and performance products, with new product announcements expected in Q3 - The segment reported total revenue of **$1.7 million** for the quarter and ended with an annualized revenue run rate of **$9.7 million**[64](index=64&type=chunk) - The Greenscreens acquisition, completed May 8, contributed approximately **$1.3 million** in noninterest income and **$1.3 million** in operating expenses for the partial quarter[65](index=65&type=chunk) - Near-term development is focused on integrating Triumph's data into ISO and Greenscreens, integrating the two products, and building new products[68](index=68&type=chunk) - Early testing confirms that integrating Triumph's data will demonstrably improve the prediction accuracy (MAPE) and lane coverage of the pricing engine[72](index=72&type=chunk) [Banking](index=18&type=section&id=Banking) The Banking segment's operating income decreased by 4.4% to $26.4 million, as growth in net interest income was offset by higher legal expenses, while credit metrics showed significant improvement, with non-performing loans and classified assets decreasing, aided by the USPS settlement but also driven by other resolutions - Banking segment operating income decreased **$1.2 million (4.4%)** from the prior quarter to **$26.4 million**[75](index=75&type=chunk) - Credit metrics improved significantly in Q2, with the USPS settlement accounting for less than **40%** of the overall improvement in nonaccrual loans and classified assets[76](index=76&type=chunk) Credit Quality Improvement | Metric | Improvement | USPS-Related Impact | | :--- | :--- | :--- | | Non-performing loans to total loans | 87 bps | 39 bps | | Classified assets decrease | $58.2 million | $19.4 million | [Outlook and Closing](index=6&type=section&id=Outlook%20and%20Closing) This section provides an update on the transportation market conditions and outlines the company's expense forecast for Q3, emphasizing its strategic commitment to innovation and market leadership [Transportation Market Update](index=6&type=section&id=Transportation%20Market%20Update) The transportation market continues to experience flat demand and stable capacity, with consistent pressure on broker margins since 2023, and while mild rate conditions persist, normal seasonal events and isolated demand spikes are expected to push rates higher, challenging existing capacity with any moderate increase in demand - The market saw no major surprises in trucking prices or capacity in Q2, though temporary inflation episodes occurred due to weather, road checks, and seasonality[23](index=23&type=chunk) - Aggregate dry van broker margins across the Greenscreens customer base have been under fairly consistent pressure since 2023[24](index=24&type=chunk) - Benchmark price trends show mild rate conditions have persisted since early 2023 with slight seasonal upticks[27](index=27&type=chunk) [Expense Forecast & Closing Thoughts](index=20&type=section&id=Expense%20Forecast%20%26%20Closing%20Thoughts) After a 'noisy' second quarter, the company projects a more representative core run rate for Q3, with noninterest expense forecasted to be approximately $104 million, as management expresses confidence in the company's trajectory, emphasizing its unique position and commitment to innovation to deliver value despite a soft transportation market - Q3 noninterest expense is projected to be approximately **$104 million**, which includes incremental operating expenses and intangible amortization from the Greenscreens acquisition[80](index=80&type=chunk) - The company remains committed to innovation and customer-centric solutions to strengthen its market position, regardless of market tailwinds[81](index=81&type=chunk) [Financial Statements and Supplementary Data](index=24&type=section&id=Financial%20Statements%20and%20Supplementary%20Data) This section presents the company's consolidated financial statements, including the balance sheet, income statement, and detailed segment performance data, providing a comprehensive view of its financial position and operational results [Financial Highlights](index=24&type=section&id=Financial%20Highlights) This section provides a high-level overview of key financial metrics for the quarter ended June 30, 2025, compared to previous periods, showing total assets grew to $6.5 billion, net income available to common stockholders was $3.6 million, and presenting key performance ratios alongside asset quality and capital adequacy metrics Key Financials as of June 30, 2025 | Metric | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Total Assets | $6,494.7M | $6,268.4M | $5,783.3M | | Loans Held for Investment | $4,953.2M | $4,666.2M | $4,288.4M | | Total Deposits | $5,186.1M | $4,976.8M | $4,392.0M | | Net Income (to common) | $3.6M | $(0.8)M | $1.9M | | Diluted EPS | $0.15 | $(0.03) | $0.08 | | Tangible Book Value per Share | $19.31 | $25.32 | $24.60 | [Consolidated Balance Sheet](index=25&type=section&id=Consolidated%20Balance%20Sheet) As of June 30, 2025, total assets stood at $6.5 billion, an increase from $6.3 billion in the prior quarter, primarily driven by growth in loans, while total liabilities increased to $5.6 billion, with total deposits growing to $5.2 billion, and total stockholders' equity rose to $912.4 million Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2025 | March 31, 2025 | | :--- | :--- | :--- | | **Assets** | | | | Total Assets | $6,494,748 | $6,268,394 | | Loans, net | $4,914,479 | $4,629,994 | | Goodwill | $353,900 | $241,949 | | **Liabilities & Equity** | | | | Total Deposits | $5,186,098 | $4,976,750 | | Total Liabilities | $5,582,366 | $5,374,467 | | Total Stockholders' Equity | $912,382 | $893,927 | [Consolidated Statement of Income](index=26&type=section&id=Consolidated%20Statement%20of%20Income) For the three months ended June 30, 2025, the company reported net interest income of $88.7 million and a net income of $4.4 million, with a credit loss benefit of $0.7 million largely due to the USPS recovery, and noninterest expense at $100.8 million, impacted by transaction costs and legal settlements but offset by the recovery of legal fees Consolidated Income Statement Highlights (Q2 2025, in thousands) | Line Item | Q2 2025 | Q1 2025 | | :--- | :--- | :--- | | Net Interest Income | $88,678 | $84,383 | | Credit Loss Expense (Benefit) | $(702) | $1,330 | | Total Noninterest Income | $19,384 | $17,190 | | Total Noninterest Expense | $100,840 | $100,173 | | Net Income | $4,420 | $17 | | Net Income to Common Stockholders | $3,618 | $(784) | [Segment Financials](index=29&type=section&id=Segment%20Financials) This section provides a detailed breakdown of financial performance by operating segment: Banking, Factoring, Payments, and Intelligence, with Q2 2025 showing the Banking segment generating $26.4 million in operating income, Factoring contributing $19.8 million (boosted by the USPS settlement), while Payments and Intelligence recorded operating losses of $0.7 million and $6.0 million respectively, with Intelligence impacted by acquisition costs Operating Income (Loss) by Segment (Q2 2025, in thousands) | Segment | Operating Income (Loss) | | :--- | :--- | | Banking | $26,374 | | Factoring | $19,754 | | Payments | $(654) | | Intelligence | $(5,986) |