Financial Data and Key Metrics Changes - In Q2 2025, gross originations grew by 30.4% year over year to $72.1 million, exceeding the top end of the outlook range [6][29] - Revenue for Q2 2025 increased by 22.1% to $71.9 million, surpassing the expected growth of 17% to 20% [6][31] - Adjusted EBITDA was slightly above breakeven at over $300,000, compared to expectations of breakeven [6][34] Business Line Data and Key Metrics Changes - Total app originations grew by 56% to $43.1 million, with approximately 60% of gross originations starting in the app marketplace [9][29] - KPay originations accelerated to approximately 81% year over year, totaling $28.3 million [9][20] - Unique new customers increased by approximately 40%, contributing to a total customer base growth of about 32% [10][13] Market Data and Key Metrics Changes - Gross originations for the top 25 merchants grew by 28% in Q2, with a notable 65% growth when excluding the largest merchant, Wayfair [30][31] - Direct and waterfall merchants accounted for approximately 61% of total gross originations, with a growth of about 11% [22][23] - Excluding home furnishings and mattress categories, gross originations grew by 62% year over year [29][30] Company Strategy and Development Direction - The company aims to build a successful two-sided marketplace for lease-to-own consumers, focusing on consumer engagement, merchant engagement, referral partnerships, and improving unit economics [11][28] - The strategy includes enhancing the consumer journey and experience to drive engagement and conversion [15][19] - The company is actively working on partnerships to drive top-of-funnel traffic and referrals [27][28] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the resilience of customers despite macroeconomic factors and expects write-offs to remain within the targeted range of 8% to 10% [44][45] - The company is raising its 2025 outlook for gross originations to a growth range of 25% to 30% [41][42] - Management is closely monitoring macroeconomic headwinds and is prepared to adapt to changes in economic policies [27][41] Other Important Information - The company completed a refinancing agreement that increased liquidity and reduced interest rates on its revolving line of credit [38][39] - Cash used for operations in Q2 2025 was $3.2 million, compared to $1.4 million generated in Q2 2024 [40] Q&A Session Summary Question: What drove the year-over-year increase in lease merchandise charge-off rate? - Management noted fluctuations in quarterly results are not concerning as they remain within the targeted range [44][45] Question: What does the pipeline look like for new partners? - The pipeline is strong, with interest from various segments, including auto and home furnishings [47][48] Question: What strategies are being implemented to drive higher application activity? - The company has focused on digital marketing and customer referral strategies to attract new customers [52][54] Question: What is the competitive environment like regarding pricing and credit? - Management indicated stability in the competitive landscape and emphasized optimizing pricing for conversion and repeat rates [55][57]

Financial Data and Key Metrics Changes - Gross originations grew 15.4% year over year to $64.2 million in Q1 2025, marking the tenth consecutive quarter of growth [26][27] - Revenue for Q1 2025 was $71.9 million, reflecting a 10.6% increase year over year, and this was the eighth consecutive quarter of year-over-year growth [27] - Gross profit for Q1 was approximately $14.3 million, with a gross margin of 19.9%, down from $16.5 million the previous year [28][29] - Write-offs as a percentage of revenue were 9%, an improvement from Q4 performance and within the target range of 8% to 10% [29] Business Line Data and Key Metrics Changes - KPay originations increased by approximately 57% to $22.8 million, representing 35% of total gross originations [12][9] - Total app originations grew 42% to $37.9 million, with 59% of gross originations starting in the app marketplace [9][7] - The number of customers with more than one active lease grew nearly 60% year over year, with over 28% of the customer base having multiple leases [11] Market Data and Key Metrics Changes - Gross originations for the top 25 merchants grew 13% in Q1 2025, despite challenges faced by the largest merchant, Wayfair, which reported $17 million in gross originations [22][44] - Excluding home furnishings and mattress categories, gross originations grew 51% year over year [27] Company Strategy and Development Direction - The company is focused on four top initiatives: consumer engagement, merchant engagement, referral partnerships, and improving unit economics and capital structure [7] - New partnerships and marketing strategies are being developed to drive sales and enhance the customer experience [24][19] - The company is exploring new pathways for partnerships to expand customer engagement and brand awareness [24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving full-year goals despite macroeconomic headwinds, emphasizing strong Q1 results and positive growth momentum [6][23] - The company anticipates gross originations growth of at least 20% for the full year 2025, with revenue growth expected to be at least 20% as well [38][37] Other Important Information - The company is actively negotiating a maturity extension amendment for its credit facility, with a temporary waiver of certain covenant breaches in place [35][36] - Cash generated from operations for Q1 2025 was $3.4 million, an increase from $2 million in Q1 2024 [36] Q&A Session Summary Question: Clarification on EBITDA expectations - Management explained that despite breakeven expectations in Q2, they anticipate strong growth in the second half of the year, leading to a total of $10 million in EBITDA [40][42] Question: Performance of Wayfair - Management confirmed that Wayfair faced challenges, reporting $17 million in gross originations for Q1 2025 [44][45] Question: Credit facility maturity - Management stated they are negotiating with existing lenders for a comprehensive maturity extension amendment [47] Question: KPay growth and customer engagement - Management highlighted that KPay is driving significant growth and customer engagement, with higher lifetime value from KPay users [51][54] Question: Second quarter performance expectations - Management indicated that they expect gross originations growth in Q2 to be between 25% to 30% [60][61]