ATLANTICUS HOLDI(ATLCP) - 2025 Q2 - Quarterly Report

PART I. FINANCIAL INFORMATION This section presents the unaudited condensed consolidated financial statements and management's discussion and analysis for Atlanticus Holdings Corporation Item 1. Financial Statements (Unaudited) This section presents Atlanticus Holdings Corporation's unaudited condensed consolidated financial statements for Q2 2025 and prior periods Condensed Consolidated Balance Sheets Atlanticus' balance sheets as of June 30, 2025, and December 31, 2024, show significant asset and equity growth | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | Change (YoY) | Percentage Change (YoY) | | :-------------------------------- | :----------------------------- | :------------------------------- | :----------- | :---------------------- | | Total Assets | $3,643,175 | $3,270,707 | $372,468 | 11.39% | | Loans at fair value | $3,004,724 | $2,630,274 | $374,450 | 14.24% | | Total Liabilities | $3,043,997 | $2,691,344 | $352,653 | 13.11% | | Notes payable, net | $2,466,059 | $2,199,448 | $266,611 | 12.12% | | Total Equity | $559,178 | $489,363 | $69,815 | 14.27% | Condensed Consolidated Statements of Income The income statements show strong revenue growth and increased profitability for Q2 2025 compared to Q2 2024 | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Change (YoY) | Percentage Change (YoY) | | :------------------------------------ | :------------------------------------ | :------------------------------------ | :----------- | :---------------------- | | Total revenue and other income | $394,163 | $316,023 | $78,140 | 24.73% | | Net income | $30,290 | $24,127 | $6,163 | 25.54% | | Net income attributable to common shareholders | $28,351 | $17,972 | $10,379 | 57.75% | | Basic EPS | $1.87 | $1.22 | $0.65 | 53.28% | | Diluted EPS | $1.51 | $0.99 | $0.52 | 52.53% | | Metric | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | Change (YoY) | Percentage Change (YoY) | | :------------------------------------ | :------------------------------------ | :------------------------------------ | :----------- | :---------------------- | | Total revenue and other income | $739,329 | $606,729 | $132,600 | 21.85% | | Net income | $61,412 | $49,946 | $11,466 | 22.96% | | Net income attributable to common shareholders | $56,297 | $37,850 | $18,447 | 48.74% | | Basic EPS | $3.72 | $2.57 | $1.15 | 44.75% | | Diluted EPS | $3.00 | $2.08 | $0.92 | 44.23% | Condensed Consolidated Statements of Shareholders' Equity and Temporary Equity This section details changes in equity for the six months ended June 30, 2025, and June 30, 2024, including net income and dividends - Total equity increased from $489.36 million at January 1, 2025, to $559.18 million at June 30, 2025, primarily due to net income and common stock issuances, partially offset by dividends and redemption of preferred units[14] - The company redeemed the remaining 50.0 million Class B preferred units in March 2025, which were previously issued to noncontrolling interests[14] - Series B preferred stock shares issued increased from 3,301,179 at January 1, 2025, to 3,457,443 at June 30, 2025[14] Condensed Consolidated Statements of Cash Flows Cash flows show a net decrease in cash for the six months ended June 30, 2025, driven by increased investing activities | Cash Flow Activity | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | Change (YoY) | | :------------------------------------------ | :------------------------------------ | :------------------------------------ | :----------- | | Net cash provided by operating activities | $264,260 | $234,439 | $29,821 | | Net cash used in investing activities | $(520,419) | $(264,752) | $(255,667) | | Net cash provided by financing activities | $239,758 | $53,823 | $185,935 | | Net (decrease) increase in cash and cash equivalents and restricted cash | $(16,401) | $23,510 | $(39,911) | | Cash and cash equivalents and restricted cash equivalents at end of period | $483,235 | $407,163 | $76,072 | - Investing activities saw a significant increase in cash usage, primarily due to higher investments in earning assets, which rose from $1.24 billion in 2024 to $1.55 billion in 2025[18] - Financing activities provided substantially more cash in 2025, driven by increased proceeds from borrowings ($894.69 million in 2025 vs $423.90 million in 2024)[18] Notes to Condensed Consolidated Financial Statements The notes provide detailed explanations of the company's business, accounting policies, segment reporting, and other financial contexts Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations This section provides management's perspective on the company's financial condition and results of operations for Q2 2025 compared to Q2 2024 Overview Atlanticus Holdings Corporation is a financial technology company focused on facilitating consumer credit for underserved Americans using data, analytics, and AI - Atlanticus is a financial technology company focused on inclusive financial solutions for everyday Americans, particularly those with FICO scores below 700[161] - The company provides technology and support services to bank partners (The Bank of Missouri and WebBank) for originating private label and general purpose card products[161] - Atlanticus' decisioning platform is enhanced by artificial intelligence and machine learning for fast, sound credit decisions[161] Credit as a Service Segment The CaaS segment supports lenders in offering inclusive financial services, including private label and general purpose credit cards, leveraging technology and analytics - CaaS segment offers private label credit cards (Fortiva, Curae) and general purpose credit cards (Aspire, Imagine, Fortiva) through bank partners[163] - The segment's technology allows instant credit decisions using proprietary predictive analytics and AI/machine learning, targeting consumers with lower FICO scores[26] - Revenue is recognized from finance charges, fees, and merchant fees, with loans valued at fair value, reflecting expected ongoing economics and cash flows[166] Private Label Credit Private label credit products offer financing with APRs from 0% to 36% and merchant fees from 0% to 65%, paid by retail partners - Private label credit products feature APRs ranging from 0% to 36% and merchant fees from 0% to 65%[171] - Merchant fees are paid by retail partners to Atlanticus to facilitate transactions and enhance returns, particularly for promotional offers with lower APRs[171] - Financing terms range from 12 to 84 months, customized for retail clients based on expected performance, purchase volumes, and return requirements[172] [General Purpose Credit Cards](index=45&type=section&id