Core Insights - Oportun Financial Corporation reported significant improvements in its Q1 2025 financial results, demonstrating growth in originations and profitability metrics [3][7]. Financial Highlights - Total originations reached $469.3 million, reflecting a 38.7% year-over-year increase, marking the second consecutive quarter of growth [3]. - Total revenue for Q1 was $235.9 million, with adjusted EPS of $0.40 compared to $0.09 in Q1 2024 [7]. - Adjusted EBITDA totaled $34 million, a substantial increase from $1.9 million in Q1 2024 [7]. Operational Analysis - The annualized net charge-off rate improved to 12.2%, at the low end of the company's guidance range [3]. - Adjusted operating expenses were $89 million, down 13% year-over-year, with operating expenses as a percentage of average daily principal balance improving by 160 basis points to 13.9% [4]. Credit Quality - The front book's annualized net charge-off rate was 11.5%, slightly above the target range of 9% to 11%, while the back book declined to only 4% of the loan portfolio, expected to decrease to 1% by year-end [5]. 2025 Outlook - Management reaffirmed its guidance for FY 2025, moderating loan originations growth expectations to 10% [6]. - Revenue is projected between $945 million and $970 million, with adjusted EBITDA expected between $135 million and $145 million, representing a 34% year-over-year increase at the midpoint [8]. Unit Economics - The company's business model targets a long-term Return on Equity in the range of 20%-28%, which appears achievable as the back book continues to shrink and operating expenses decline further [9]. Future Projections - Adjusted EPS is forecasted between $1.10 and $1.30, indicating a 73% year-over-year increase at the midpoint [14]. - The net charge-off rate is expected to be at 11.5% (±50 basis points), with the company aiming for GAAP profitability by the end of FY 2025 [14].