PROG (PRG) - 2025 Q3 - Quarterly Results

Executive Summary & Highlights Q3 2025 Overview PROG Holdings reported Q3 2025 consolidated revenues of $595.1 million and net earnings of $33.1 million - PROG Holdings, Inc. (NYSE:PRG) announced financial results for the third quarter ended September 30, 2025[2] Q3 2025 Consolidated Financial Snapshot | Metric | Value | | :-------------------- | :------------ | | Consolidated Revenues | $595.1 million | | Net Earnings | $33.1 million | CEO Commentary CEO Steve Michaels highlighted strong Progressive Leasing earnings, Four Technologies' triple-digit growth, and Vive's strategic sale for capital efficiency - Delivered strong earnings and expanded margins in the Progressive Leasing segment despite modest revenue headwinds[3] - Four Technologies achieved its eighth consecutive quarter of triple-digit GMV and revenue growth, validating its BNPL platform[3] - The sale of Vive improves capital efficiency and supports the capital allocation strategy[3] - Strategic focus on a three-pillar strategy: Grow, Enhance, and Expand, with investments in Progressive Leasing, PROG Marketplace, and Four Technologies[3] Key Financial Highlights (Q3 2025) Q3 2025 key consolidated metrics included revenues of $595.1 million, net earnings of $33.1 million, and Adjusted EBITDA of $67.0 million Q3 2025 Key Financial Highlights | Metric | Value | | :-------------------------------- | :---------------- | | Consolidated Revenues | $595.1 million | | Net Earnings | $33.1 million | | Adjusted EBITDA | $67.0 million | | Diluted EPS | $0.82 | | Non-GAAP Diluted EPS | $0.90 | | Progressive Leasing GMV | $410.9 million | | Four Technologies GMV Growth | 162.8% | | Four Technologies Adjusted EBITDA | Positive (3rd consecutive quarter) | Third Quarter 2025 Financial Results Consolidated Results Q3 2025 consolidated revenues decreased to $595.1 million, net earnings dropped to $33.1 million, while Adjusted EBITDA increased to $67.0 million Consolidated Financial Performance (Q3 2025 vs Q3 2024) | Metric | Q3 2025 | Q3 2024 | Change (YoY) | | :-------------------- | :---------- | :---------- | :----------- | | Revenues | $595.1M | $606.1M | -1.8% | | Net Earnings | $33.1M | $84.0M | -60.6% | | Adjusted EBITDA | $67.0M | $63.5M | +5.5% | | Adjusted EBITDA % of Rev | 11.3% | 10.5% | +0.8 pp | | Diluted EPS | $0.82 | $1.94 | -57.7% | | Non-GAAP Diluted EPS | $0.90 | $0.77 | +16.9% | - The year-ago consolidated net earnings included a $53.6 million non-cash, net tax benefit[6] - The Company's diluted weighted average shares outstanding in the third quarter were 6.2% lower year-over-year[7] Progressive Leasing Results Progressive Leasing's Q3 2025 GMV was $410.9 million, a 10.0% decrease, with write-offs at 7.4% of leasing revenues Progressive Leasing Q3 2025 Performance | Metric | Value | | :-------------------------------- | :------------ | | GMV | $410.9 million | | YoY GMV Change | -10.0% | | Provision for Lease Merchandise Write-offs | 7.4% of leasing revenues (within 6-8% target) | Liquidity and Capital Allocation PROG Holdings maintained a strong financial position with $292.6 million in cash and $600.0 million in gross debt as of Q3 2025 Liquidity and Capital Allocation (Q3 2025 End) | Metric | Value | | :-------------------------- | :------------ | | Cash | $292.6 million | | Gross Debt | $600.0 million | | Share Repurchase Capacity | $309.6 million (under $500M program) | | Quarterly Cash Dividend | $0.13 per share | 2025 Outlook Overview and Assumptions PROG Holdings provided Q4 and full-year 2025 outlook, excluding Vive, assuming a challenging operating environment and 27% tax rate - Vive segment excluded from outlook and will be presented as discontinued operations beginning in Q4 2025 due to the sale of its credit card portfolio[10] - Outlook assumes a difficult operating environment with soft demand for consumer durable goods[10] - Assumes no material changes in the Company's current decisioning posture and an effective tax rate for Non-GAAP EPS of approximately 27%[10] Full Year and Fourth Quarter 2025 Outlook Metrics Full-year 2025 outlook revised with lower revenue but higher net earnings; Q4 projects $575-590 million in revenues Revised vs. Previous Full Year 2025 Outlook (Continuing Operations) | Metric | Revised Low | Revised High | Previous Low | Previous High | | :------------------------------------ | :---------- | :----------- | :----------- | :------------ | | Total Revenues | $2,410,000 | $2,435,000 | $2,450,000 | $2,500,000 | | Net Earnings from Continuing Operations | $124,300 | $128,800 | $120,000 | $125,000 | | Adjusted EBITDA | $258,000 | $265,000 | $255,000 | $265,000 | | Diluted EPS from Continuing Operations | $3.06 | $3.16 | $2.91 | $3.06 | | Diluted Non-GAAP EPS from Continuing Operations | $3.35 | $3.45 | $3.20 | $3.35 | Three Months Ended December 31, 2025 Outlook (Continuing Operations) | Metric | Low | High | | :------------------------------------ | :-------- | :-------- | | Total Revenues | $575,000 | $590,000 | | Net Earnings from Continuing Operations | $17,000 | $24,000 | | Adjusted EBITDA | $47,000 | $54,000 | | Diluted EPS from Continuing Operations | $0.47 | $0.57 | | Diluted Non-GAAP EPS from Continuing Operations | $0.55 | $0.65 | Company Information About PROG Holdings, Inc. PROG Holdings, Inc. is a Salt Lake City-based fintech holding company offering lease-to-own, BNPL, and credit building products - PROG Holdings, Inc. (NYSE:PRG) is a fintech holding company headquartered in Salt Lake City, UT[13] - The Company owns Progressive Leasing (lease-to-own), Four Technologies (Buy Now, Pay Later), and Build (personal credit building products)[13] Conference Call and Webcast A webcast and conference call was scheduled for October 22, 2025, at 8:30 A.M. ET to discuss Q3 2025 financial results - A live webcast and conference call was scheduled for Wednesday, October 22, 2025, at 8:30 A.M. ET to discuss Q3 2025 financial results[12] - The webcast can be accessed on the Events and Presentations page of the Company's Investor Relations website[12] Forward-Looking Statements Forward-looking statements involve risks including macroeconomic volatility, consumer demand, retail partner reliance, and regulatory compliance - Statements, estimates, and projections in this press release are 'forward-looking statements' subject to risks and uncertainties[14] - Risks include continued volatility in the macroeconomic environment, impact on consumer demand and disposable income, reliance on key retail partners, and the inability to attract new retail partners or customers[14] - Further risks involve business model differences for Vive and Four, modernization of IT systems, intense competition, maintaining consumer satisfaction, extensive federal/state/local laws and regulations, negative characterization of transactions, cybersecurity incidents, and the effectiveness of capital allocation strategy[14][15] Investor Relations Contact John A. Baugh, CFA, Vice President of Investor Relations, is the contact for investor inquiries - Investor Contact: John A. Baugh, CFA, Vice President, Investor Relations[16] Financial Statements (GAAP) Consolidated Statements of Earnings Consolidated statements of earnings show Q3 2025 revenues of $595.1 million and net earnings of $33.1 million Consolidated Statements of Earnings (Three Months Ended September 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | | :-------------------------------- | :------------------ | :------------------ | | Lease Revenues and Fees | $556,583 | $582,551 | | Interest and Fees on Loans Receivable | $38,525 | $23,594 | | Total Revenues | $595,108 | $606,145 | | Operating Profit | $53,529 | $49,231 | | Net Earnings | $33,121 | $83,962 | | Diluted EPS | $0.82 | $1.94 | Consolidated Statements of Earnings (Nine Months Ended September 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | | :-------------------------------- | :------------------ | :------------------ | | Lease Revenues and Fees | $1,777,814 | $1,773,617 | | Interest and Fees on Loans Receivable | $106,045 | $66,559 | | Total Revenues | $1,883,859 | $1,840,176 | | Operating Profit | $170,574 | $144,726 | | Net Earnings | $106,322 | $139,702 | | Diluted EPS | $2.60 | $3.19 | Consolidated Balance Sheets Consolidated balance sheets show total assets increased to $1,546.6 million, with higher cash and equity, and lower liabilities Consolidated Balance Sheet (September 30, 2025 vs. December 31, 2024) | Metric | Sep 30, 2025 (in thousands) | Dec 31, 2024 (in thousands) | | :------------------------------------ | :-------------------------- | :-------------------------- | | Cash and Cash Equivalents | $292,610 | $95,655 | | Lease Merchandise (net) | $501,152 | $680,242 | | Loans Receivable (net) | $160,350 | $146,985 | | Total Assets | $1,546,601 | $1,513,767 | | Debt, Net | $594,537 | $643,563 | | Total Liabilities | $843,044 | $863,486 | | Total Shareholders' Equity | $703,557 | $650,281 | Consolidated Statements of Cash Flows Cash provided by operating activities significantly increased to $389.9 million for the nine months ended September 30, 2025 Consolidated Statements of Cash Flows (Nine Months Ended September 30) | Activity | 2025 (in thousands) | 2024 (in thousands) | | :-------------------------------- | :------------------ | :------------------ | | Cash Provided by Operating Activities | $389,865 | $223,013 | | Cash Used in Investing Activities | $(69,041) | $(35,648) | | Cash Used in Financing Activities | $(123,869) | $(121,055) | | Increase in Cash and Cash Equivalents | $196,955 | $66,310 | | Cash and Cash Equivalents at End of Period | $292,610 | $221,726 | Segment Performance (GAAP) Quarterly Revenues by Segment Q3 2025 consolidated revenue was $595.1 million, with Progressive Leasing contributing $556.6 million, a slight decrease from Q3 2024 Quarterly Revenues by Segment (Three Months Ended September 30, 2025) | Segment | Lease Revenues and Fees (in thousands) | Interest and Fees on Loans Receivable (in thousands) | Total Revenues (in thousands) | | :------------------ | :----------------------------------- | :------------------------------------------------- | :---------------------------- | | Progressive Leasing | $556,583 | — | $556,583 | | Vive | — | $17,402 | $17,402 | | Other | — | $21,123 | $21,123 | | Consolidated Total | $556,583 | $38,525 | $595,108 | Quarterly Revenues by Segment (Three Months Ended September 30, 2024) | Segment | Lease Revenues and Fees (in thousands) | Interest and Fees on Loans Receivable (in thousands) | Total Revenues (in thousands) | | :------------------ | :----------------------------------- | :------------------------------------------------- | :---------------------------- | | Progressive Leasing | $582,551 | — | $582,551 | | Vive | — | $16,000 | $16,000 | | Other | — | $7,594 | $7,594 | | Consolidated Total | $582,551 | $23,594 | $606,145 | Nine Month Revenues by Segment Nine-month consolidated revenues reached $1,883.9 million, driven by Progressive Leasing, Vive, and Other segments Nine Month Revenues by Segment (Nine Months Ended September 30, 2025) | Segment | Lease Revenues and Fees (in thousands) | Interest and Fees on Loans Receivable (in thousands) | Total Revenues (in thousands) | | :------------------ | :----------------------------------- | :------------------------------------------------- | :---------------------------- | | Progressive Leasing | $1,777,814 | — | $1,777,814 | | Vive | — | $49,221 | $49,221 | | Other | — | $56,824 | $56,824 | | Consolidated Total | $1,777,814 | $106,045 | $1,883,859 | Nine Month Revenues by Segment (Nine Months Ended September 30, 2024) | Segment | Lease Revenues and Fees (in thousands) | Interest and Fees on Loans Receivable (in thousands) | Total Revenues (in thousands) | | :------------------ | :----------------------------------- | :------------------------------------------------- | :---------------------------- | | Progressive Leasing | $1,773,617 | — | $1,773,617 | | Vive | — | $47,471 | $47,471 | | Other | — | $19,088 | $19,088 | | Consolidated Total | $1,773,617 | $66,559 | $1,840,176 | Quarterly Gross Merchandise Volume by Segment Q3 2025 total GMV increased to $620.3 million, primarily due to growth in Vive and Other segments, offsetting Progressive Leasing's decline Quarterly Gross Merchandise Volume by Segment (Three Months Ended September 30) | Segment | 2025 (in thousands) | 2024 (in thousands) | | :------------------ | :------------------ | :------------------ | | Progressive Leasing | $410,943 | $456,651 | | Vive | $46,308 | $38,755 | | Other | $163,086 | $62,058 | | Total GMV | $620,337 | $557,464 | Non-GAAP Financial Measures Use and Definition of Non-GAAP Financial Information PROG Holdings uses Non-GAAP measures like Adjusted EBITDA and diluted EPS, excluding specific items, for supplemental performance insights - Non-GAAP net earnings, diluted EPS, and Adjusted EBITDA are supplemental measures not calculated in accordance with GAAP[29] - Exclusions for Non-GAAP outlook include Vive operations and gain on sale of its credit card portfolio[29][30] - Historical Non-GAAP adjustments include intangible amortization, transaction costs, restructuring expenses, cybersecurity incident costs, and certain tax benefits/accrued interest[29][30] - Management believes these measures provide relevant and useful information for assessing performance and are widely used by analysts, investors, and competitors[31][32] - Non-GAAP measures should not be used as a substitute for GAAP measures and may not be comparable to similar measures disclosed by other companies[33] Reconciliation of Net Earnings and Diluted EPS to Non-GAAP Reconciliation details GAAP to Non-GAAP net earnings and diluted EPS, adjusting for amortization, transaction costs, and other items Reconciliation of Net Earnings to Non-GAAP Net Earnings (Three Months Ended September 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | | :------------------------------------ | :------------------ | :------------------ | | Net Earnings (GAAP) | $33,121 | $83,962 | | Add: Intangible Amortization Expense | $3,999 | $4,000 | | Add: Transaction Costs | $200 | — | | Add: Restructuring Expense | — | $6 | | Add: Costs Related to Cybersecurity Incident | $58 | $114 | | Less: Tax Impact of Adjustments | $(1,107) | $(1,071) | | Less: Reversal of Uncertain Tax Position | — | $(53,599) | | Non-GAAP Net Earnings | $36,271 | $33,412 | Reconciliation of Diluted EPS to Non-GAAP Diluted EPS (Three Months Ended September 30) | Metric | 2025 | 2024 | | :------------------------------------ | :--- | :--- | | Diluted EPS (GAAP) | $0.82 | $1.94 | | Add: Intangible Amortization Expense | $0.10 | $0.09 | | Add: Transaction Costs | — | — | | Add: Restructuring Expense | — | — | | Add: Costs Related to Cybersecurity Incident | — | — | | Less: Tax Impact of Adjustments | $(0.03) | $(0.02) | | Less: Reversal of Uncertain Tax Position | — | $(1.24) | | Non-GAAP Diluted EPS | $0.90 | $0.77 | Quarterly Segment Adjusted EBITDA Quarterly segment Adjusted EBITDA reconciliation shows consolidated Adjusted EBITDA of $67.0 million in Q3 2025, up from $63.5 million Quarterly Segment Adjusted EBITDA (Three Months Ended September 30, 2025) | Segment | Progressive Leasing (in thousands) | Vive (in thousands) | Other (in thousands) | Consolidated Total (in thousands) | | :------------------------------------ | :------------------------------- | :------------------ | :------------------- | :-------------------------------- | | Earnings (Loss) Before Income Tax | $46,738 | $(74) | $(1,017) | $45,647 | | EBITDA | $57,775 | $333 | $1,563 | $59,671 | | Stock-Based Compensation | $6,638 | $47 | $412 | $7,097 | | Costs Related to Cybersecurity Incident | $58 | — | — | $58 | | Transaction Costs | — | $200 | — | $200 | | Adjusted EBITDA | $64,471 | $580 | $1,975 | $67,026 | Quarterly Segment Adjusted EBITDA (Three Months Ended September 30, 2024) | Segment | Progressive Leasing (in thousands) | Vive (in thousands) | Other (in thousands) | Consolidated Total (in thousands) | | :------------------------------------ | :------------------------------- | :------------------ | :------------------- | :-------------------------------- | | Earnings (Loss) Before Income Tax | $47,177 | $(1,441) | $(3,889) | $41,847 | | EBITDA | $60,267 | $(1,286) | $(3,485) | $55,496 | | Stock-Based Compensation | $6,059 | $354 | $1,438 | $7,851 | | Restructuring Expense | $6 | — | — | $6 | | Costs Related to Cybersecurity Incident | $114 | — | — | $114 | | Adjusted EBITDA | $66,446 | $(932) | $(2,047) | $63,467 | Nine Month Segment Adjusted EBITDA Nine-month segment Adjusted EBITDA reconciliation shows consolidated Adjusted EBITDA of $210.8 million, an increase from prior year Nine Month Segment Adjusted EBITDA (Nine Months Ended September 30, 2025) | Segment | Progressive Leasing (in thousands) | Vive (in thousands) | Other (in thousands) | Consolidated Total (in thousands) | | :------------------------------------ | :------------------------------- | :------------------ | :------------------- | :-------------------------------- | | Earnings (Loss) Before Income Tax | $146,909 | $(398) | $(1,058) | $145,453 | | EBITDA | $181,733 | $660 | $6,434 | $188,827 | | Stock-Based Compensation | $19,510 | $253 | $1,870 | $21,633 | | Costs Related to Cybersecurity Incident | $167 | — | — | $167 | | Transaction Costs | — | $200 | — | $200 | | Adjusted EBITDA | $201,410 | $1,113 | $8,304 | $210,827 | Nine Month Segment Adjusted EBITDA (Nine Months Ended September 30, 2024) | Segment | Progressive Leasing (in thousands) | Vive (in thousands) | Other (in thousands) | Consolidated Total (in thousands) | | :------------------------------------ | :------------------------------- | :------------------ | :------------------- | :-------------------------------- | | Earnings (Loss) Before Income Tax | $136,596 | $108 | $(14,951) | $121,753 | | EBITDA | $178,799 | $595 | $(13,888) | $165,506 | | Stock-Based Compensation | $16,905 | $1,052 | $3,631 | $21,588 | | Restructuring Expense | $18,278 | — | $2,628 | $20,906 | | Costs Related to Cybersecurity Incident | $346 | — | — | $346 | | Adjusted EBITDA | $214,328 | $1,647 | $(7,629) | $208,346 | Non-GAAP Outlook Reconciliations Full Year 2025 Outlook for Adjusted EBITDA Revised full-year 2025 Adjusted EBITDA outlook is $258.0 million to $265.0 million, reconciling net earnings with various adjustments Revised Fiscal Year 2025 Outlook for Adjusted EBITDA (Continuing Operations) | Metric | Progressive Leasing (in thousands) | Other (in thousands) | Consolidated Total (in thousands) | | :------------------------------------ | :------------------------------- | :------------------- | :-------------------------------- | | Estimated Net Earnings from Continuing Operations | | | $124,300 - $128,800 | | Projected Adjusted EBITDA | $256,000 - $261,000 | $2,000 - $4,000 | $258,000 - $265,000 | Previous Fiscal Year 2025 Outlook for Adjusted EBITDA | Metric | Progressive Leasing (in thousands) | Vive (in thousands) | Other (in thousands) | Consolidated Total (in thousands) | | :------------------------------------ | :------------------------------- | :------------------ | :------------------- | :-------------------------------- | | Estimated Net Earnings | | | | $120,000 - $125,000 | | Projected Adjusted EBITDA | $255,000 - $261,000 | $(2,500) - $(1,000) | $2,500 - $5,000 | $255,000 - $265,000 | Fourth Quarter 2025 Outlook for Adjusted EBITDA Q4 2025 outlook projects consolidated Adjusted EBITDA between $47.0 million and $54.0 million, based on estimated net earnings Three Months Ended December 31, 2025 Outlook for Adjusted EBITDA (Consolidated Total) | Metric | Low (in thousands) | High (in thousands) | | :------------------------------------ | :----------------- | :----------------- | | Estimated Net Earnings from Continuing Operations | $17,000 | $24,000 | | Projected Adjusted EBITDA | $47,000 | $54,000 | Full Year 2025 Outlook for Diluted EPS Revised full-year 2025 Non-GAAP diluted EPS outlook is $3.35 to $3.45, adjusting GAAP EPS for amortization and tax effects Revised Full Year 2025 Outlook for Diluted EPS to Non-GAAP Diluted EPS (Continuing Operations) | Metric | Low | High | | :------------------------------------------------------ | :--- | :--- | | Projected Diluted Earnings Per Share from Continuing Operations (GAAP) | $3.06 | $3.16 | | Add: Projected Intangible Amortization Expense | $0.39 | $0.39 | | Subtract: Tax Effect on Non-GAAP Adjustments | $(0.10) | $(0.10) | | Projected Non-GAAP Diluted Earnings Per Share from Continuing Operations | $3.35 | $3.45 | Previous Full Year 2025 Outlook for Diluted EPS to Non-GAAP Diluted EPS | Metric | Low | High | | :------------------------------------ | :--- | :--- | | Projected Diluted Earnings Per Share (GAAP) | $2.91 | $3.06 | | Add: Projected Intangible Amortization Expense | $0.39 | $0.39 | | Subtract: Tax Effect on Non-GAAP Adjustments | $(0.10) | $(0.10) | | Projected Non-GAAP Diluted Earnings Per Share | $3.20 | $3.35 | Fourth Quarter 2025 Outlook for Diluted EPS Q4 2025 Non-GAAP diluted EPS outlook is $0.55 to $0.65, adjusting GAAP EPS for amortization and tax effects Three Months Ended December 31, 2025 Outlook for Diluted EPS to Non-GAAP Diluted EPS (Continuing Operations) | Metric | Low | High | | :------------------------------------------------------ | :--- | :--- | | Projected Diluted Earnings Per Share from Continuing Operations (GAAP) | $0.47 | $0.57 | | Add: Projected Intangible Amortization Expense | $0.10 | $0.10 | | Subtract: Tax Effect on Non-GAAP Adjustments | $(0.03) | $(0.03) | | Projected Non-GAAP Diluted Earnings Per Share from Continuing Operations | $0.55 | $0.65 |