OppFi Q2 2025 Earnings Call Transcript

Quartr
Provided by Quartr
August 6, 2025

Key Takeaways

  • Positive Sentiment: OPFI delivered a record quarter with a 13% year-over-year revenue increase, 59% growth in adjusted net income, and raised full-year 2025 guidance for revenue, net income, and EPS.
  • Positive Sentiment: Its proprietary Model Six underwriting system drove a 14% rise in net originations and improved the net charge-off rate to 32% of revenue, highlighting healthy credit performance.
  • Positive Sentiment: The company plans to migrate to its new AI-integrated loan origination platform, LOLA, over the next six months to reduce processing times, increase automation, and enhance customer experience.
  • Negative Sentiment: On a GAAP basis, net income fell 59% to $11 million due to a $33 million non-cash warrant fair-value charge despite strong operational results.
  • Positive Sentiment: OPFI closed Q2 with $78 million in cash and $603 million of total funding capacity, and is considering stock buybacks to address the gap between enterprise value and its share price.
AI Generated. May Contain Errors.
Earnings Conference Call
OppFi Q2 2025
00:00 / 00:00

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Operator

morning, and welcome to OpFife's Second Quarter twenty twenty five Earnings Conference Call. All participants are in a listen only mode. As a reminder, this conference call is being recorded. Following management's presentation, a question and answer session will be held. For those listening by dial in, you will be prompted to enter the queue after the prepared remarks.

Operator

I am pleased to introduce your Mike Gallantine, Head of Investor Relations. You may begin.

Mike Gallentine
Mike Gallentine
Head of IR at OppFi

Thank you, operator. Good morning, and welcome to OPI's second quarter twenty twenty five earnings call. Today, our Executive Chairman and CEO, Todd Schwartz and CFO, Pam Johnson, will present our financial results, followed by a question and answer session. You can access the earnings presentation on our website at investors.opbuy.com. During this call, OPFI may discuss certain forward looking information.

Mike Gallentine
Mike Gallentine
Head of IR at OppFi

The company's filings with the SEC describe essential factors that could cause actual results, developments and business decisions to differ materially from forward looking statements. Please refer to Slide two of the earnings presentation and press release for our disclaimer statements covering forward looking statements and references to information about non GAAP financial measures, which will be discussed throughout today's call. Reconciliations of those measures to GAAP measures can be found in the appendix to our earnings presentation and press release. With that, I'd like to turn the call over to Todd.

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

Thanks, Mike, and good morning, everyone. Thank you for joining us today. After a strong start to 2025, I'm proud to report that the second quarter was a record quarter for OpFy. The business achieved record quarterly revenue, adjusted net income and operating margin.

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

Our Q2 results reinforce our belief that OPFI is unlocking its full growth potential and demonstrating that we are well positioned to continue increasing profitability and strengthening our balance sheet. Given our Q2 outperformance, we are increasing full year 2025 revenue, adjusted net income, and adjusted EPS guidance. During the quarter, the company generated a 14% increase in total net originations, a 13% increase in revenue and a 59% increase in adjusted net income year over year. Our disciplined approach to growth and dynamic pricing led to this double digit growth, and we anticipate that year over year growth will continue throughout 2025. Throughout the quarter, the underwriting model, Model six, continued to perform well.

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

In the 2025, OpFund's net charge off rate improved to 32% of revenue compared to 33% for the prior year. The model gives us the confidence that we will be able to continue to grow and weather different periods of economic volatility. Offline continues to invest in product and technology initiatives to improve customer experience in originations and servicing. The auto approval rate improved to 80% in q two two thousand twenty five, up from 76% in q two two thousand twenty four, which in turn improved funnel metrics and propelled our net revenue up 16% year over year. OpLoans remains one of the highest rated products in the industry, posting an 79 NPS score and a CSAT score of 89% throughout the quarter.

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

We are proud to announce our new loan origination lending application named LOLA. Our product, tech, and operation teams have been working diligently over the last year to build the loan origination system of the future. It's designed to significantly reduce loan application processing times and boost operational efficiencies. By integrating with AI tools, Lola is expected to enhance customer experiences, improve satisfaction, and increase automation, including auto approvals. Its modern architecture also allows for seamless integration with other major systems and tools, creating a cleaner data layer and providing deeper insights to fuel further innovation.

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

Over the next six months, Opti plans to migrate to Lola. Our investment in Bitty continued to perform well in the 2025. The business continues to add accretive profitability and cash flow to Opti. Citi is doing a great job utilizing technology to improve operations and the customer experience, identifying additional growth opportunities in new credit segments and capitalizing on the continued supply demand imbalance in the small business lending space. Overall, OPFI had a strong quarter financially and operationally.

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

We expect continued healthy revenue momentum and profitable growth throughout the remainder of 2025 and into 02/1926. We believe OpFy is well on its way to executing its vision of becoming the leading tech enabled digital finance platform that collaborates with banks to offer financial products and services to everyday Americans. With that, I'll turn the call over to Pam.

Pamela Johnson
Pamela Johnson
CFO at OppFi

Thanks, Todd, and good morning, everyone. As Todd noted, we had another quarter with record results. These are due in large part to the proprietary Model six credit software. Model six has helped us expand our reach and grow our business in a highly capital efficient and profitable manner. Its enhanced predictive power has enabled the ability to confidently underwrite larger loan amounts for credit worthy individuals.

Pamela Johnson
Pamela Johnson
CFO at OppFi

This ability to increase the average loan size while maintaining rigorous risk standards directly fuel the growth in originations, which Todd mentioned. The impact of Model six extends beyond just loan size. We have also seen an improvement in the auto approval rates. This enables deserving borrowers to more easily access credit, thereby enhancing the customer experience, increasing operational efficiency and improving customer satisfaction. The synergy between expanding originations driven by larger and more efficiently approved loans and disciplined credit performance is clearly reflected in the healthy growth of our finance receivables, which increased 13% to $438,000,000 year over year.

Pamela Johnson
Pamela Johnson
CFO at OppFi

This growth is supported by the improved predictive accuracy of Model six, which is properly aligned loan prices and terms with risk driving revenue. As a result of the machine learning improvements incorporated into Model six, which helps underwrite better performing loans and increase finance receivables, total revenue reached a quarterly record of $142,000,000 representing a 13% increase year over year. The revenue growth, coupled with a lower net charge off rate, drove a significant 16% increase in net revenue to $100,000,000 The net result of these positive effects was a 130 basis point improvement in the average yield to a quarterly record 136%. Our focus on cost discipline also played a key role in our strong performance. Continued operational improvements contributed to lower total expenses before interest expense, which declined to 39% of revenue in the second quarter compared to 45% in the same quarter last year.

Pamela Johnson
Pamela Johnson
CFO at OppFi

As we noted during the first quarter earnings call, we proactively paid down our corporate debt, which reduced interest expense to 7% of total revenue, down from 9% from the prior year. As a result of the increases in revenue and reductions in expenses, adjusted net income increased 59% to a quarterly record $39,000,000 up from $25,000,000 At the same time, adjusted earnings per share grew significantly to $0.45 from $0.29 last year. On a GAAP basis, our net income decreased by 59% to $11,000,000 primarily due to a 33,000,000 noncash charge, reflecting the change in fair value of our outstanding warrants. Because our Class A common stock price increased during the quarter, the estimated value of the warrants issued when we went public also increased, driving this noncash expense. Moving to the balance sheet.

Pamela Johnson
Pamela Johnson
CFO at OppFi

We maintained a strong position, ending the quarter with $78,000,000 in cash, cash equivalents and restricted cash alongside $3.00 $6,000,000 in total debt and $218,000,000 in total stockholders' equity. Our total funding capacity was $6.00 $3,000,000 at quarter end, including $219,000,000 in unused debt capacity. We expect our healthy momentum to continue into the 2025. Given our strong operating performance, driven by growth in originations and a focus on operating efficiencies, we are providing the following updated full year guidance. For the full year 2025, we now expect total revenues to be between $578,000,000 and $6.00 $5,000,000 representing a 10% to 15% increase compared to 2024.

Pamela Johnson
Pamela Johnson
CFO at OppFi

We are again increasing our adjusted net income guidance to be between 125,000,000 and $130,000,000 representing a 51% to 57% increase compared to 2024. Based on an anticipated diluted weighted average share count of 90,000,000 shares, we are increasing our adjusted earnings per share guidance to be between $1.39 and $1.44 With that, I would now like to turn the call over to the operator for Q and A. Operator?

Operator

Thank And our first question will come from David Scarf with Citizens Capital Market. Your line is open.

David Scharf
Analyst at Citizens Capital Markets and Advisory

Hi. Good morning, and thanks for taking my questions. Hey, first one, little more high level for both Todd and Pam. I mean, obviously, you've delivered on everything and more of kind of your restructuring over the last couple of years in in both the expense and credit side as well as as well as volume. And this is not a back ended way of trying to force you into providing, you know, future guidance.

David Scharf
Analyst at Citizens Capital Markets and Advisory

But is there a long term margin structure operating model we we ought to think about? Or or maybe more specifically, you know, is is there a target ROE or or net margin over the next three, five years that you have in mind for the business based on all the changes you've made?

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

Thanks, David. Thanks for the question. I think I think we have when we when we went on this journey, when I when I come back as CEO back in 2022, we had laid out, you know, roughly what we thought those could be. We were we were we were a long way from home at that point, but but we we kinda told you, hey. This is this is what we think we're gonna achieve, and we've achieved it.

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

You know, when I think I think we're, you know, we're very satisfied where we're at today. We think that the business is performing incredibly well. Now it does ebb and flow, right, depending on some macro factors. There's there's some, you know, clouds out there that we're looking at with tariffs and stuff like that with the consumer on inflation and unemployment. But, you know, we if we can, you know, bump that, if we're achieving a 20% margin, that that is a very healthy margin.

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

And that that is, you know, probably exceeding our expectations, and we feel really, really good there. One of the things this year, you know, we wanted to return to growth, and that was a big priority for us. And I think, you know, the team has done a really great job, you know, executing on that. It's a combination of not only recruiting, you know, new customers with our great service and auto approvals, but also finding the right price and the right size of origination for our customers. So it's it's a nice balance.

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

So we have a nice, you know, kind of combination right now of growth and profitability that we will look to continue to achieve here throughout '25 and beyond.

David Scharf
Analyst at Citizens Capital Markets and Advisory

Got it. Got it. Understood. And hey, more more granularly on on the quarter, you you referenced, and I apologize, I haven't done the math myself, but you know that the latest credit models have enabled you to it sounds like, you know, notably increased the average origination size. Could could you give some context around that, sort sort of what the average loan size has increased by or or how much originations in the quarter was due to just increasing the average loan amount as as opposed to just the number of originations.

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

Yeah. I mean I mean I mean, I think I think the, you know, the way we're thinking about it is, you know, you you have you've had significant inflation. You know, obviously, inflation today is less than it was a couple of years back, but that inflation has stopped. Prices have not fallen down. And so what's really happened is our our top end price of of $4,000 was was was one of the largest originations we made. You know, that that had not been adjusted in in almost ten years where we we had not really taken into account for inflation.

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

And so we are now able to incrementally, I would say, increase that up to closer to $5,000, which will allow us for the updating of prices and and, you know, inflation in in today's economy. And then also, you know, incremental term. But these are all incremental things that we're doing. So it's it's, you know, probably 10% increase in size. And and so it's it's not it's not like we're only relying on just raising the amount of the origination.

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

It's a combination of, you know, doing that and then also, you know, making sure that our current customers are paying us and we're we're staying current. And then also, you know, there's a there's a large population of customers that have been successful in our product and paid in full that that are, you know, coming back to us at at great rates as well. So it's it's a combination of things.

Pamela Johnson
Pamela Johnson
CFO at OppFi

Got it. So, David, our average our average loan size, David, has increased by about a $100 for the year over year. But, again, these these newer larger loans are are just now infiltrating the portfolio. Right? And so you're you're you're just starting to really get the initial impact of those.

Pamela Johnson
Pamela Johnson
CFO at OppFi

But an average loan price right now is about $100 more than it was during the six months last year.

David Scharf
Analyst at Citizens Capital Markets and Advisory

I see. Just sorry, if I can squeeze in just one more on originations. I see slide deck, there's a reference to sort of the growth in the percentage of loans retained by bank partners. Is that something that was contractual or is it concentrated with, you know, one partner? Is it just kind of the demand they just wanna retain more? Can you maybe provide a little more context?

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

Yeah.

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

You know, we it's depending on the state. You know, we abide by all federal and state laws depending on on some of the the states. Banks retain different percentages. And so that just means, you know, for the quarter, there was some growth, maybe more growth in those states. So that's that's how they they retain more.

David Scharf
Analyst at Citizens Capital Markets and Advisory

Got it. Got it. Great. Thanks so much.

Operator

Thank you. Our next question will come from Kyle Joseph with Stephens. Your line is open.

Kyle Joseph
Managing Director at Stephens Inc

Hey. Good morning, guys. Thanks for taking my questions, and congrats on a nice quarter. Just wanna dive into credit a little bit more. Obviously, your your charge offs are are heading in the right direction, and you saw good expansion in your in your net revenue margin.

Kyle Joseph
Managing Director at Stephens Inc

But, you know, I just want to get your thoughts on the macro, the health of the underlying consumer, kind of any any trends you're seeing on the DQ or first payment default trends, and then, you know, layer that in with kind of some of the large the commentary around larger originations and how you expect that to impact credit going forward.

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

Yeah. Good question. You know, I I think we we, you know, we saw a strong start to the year. I think, you know, coming into the summer months, we're being we're being pretty we're still being cautious.

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

I mean, we've we've never you know, we've always been very slow to to ever change the credit back, and we're still running, I would say, pretty tight. But the good news is we've been able to, you know, still achieve growth and continue to, you know, push down the the charge off as a percentage of revenue. I think I think, you know, similar to the Fed waiting and seeing on on lowering interest rates, we're, you know, waiting and seeing a couple more things here in today's economy to make sure that, you know, that we're we're we're seeing the the FPs and also long term charge off rates that that we need to to work within the confines of our, you know, of our structure. So but, yeah, it's it's it's still we're still running, you know, relatively, I would say, tight compared to, you know, years past back in 02/1819 where much more risk segments were, you know, available at the current charge off base. So we've we've kind of largely unchanged that, and we'll continue to be, you know, cautious and read and react.

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

I mean, that's the nice thing about Model six now is our ability to dynamically read and react to situations. And and, you know, we've we've said it a couple times on the earnings call. It also focuses more on long term charge off rate than than short term, you know, volatility in the FPD numbers.

Kyle Joseph
Managing Director at Stephens Inc

Got it. Really helpful.

Kyle Joseph
Managing Director at Stephens Inc

And then just shifting to expenses a bit. Obviously, you know, the quarter really highlighted the operational leverage in the model. But, know, you're seeing kind of accelerating origination growth that has far outpaced, you know, at least marketing expense growth, you know, to be that a relatively healthy market. But, you know, how how are you thinking about the market overall? How are thinking about marketing expenses given kind of competitive factors in the market?

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

Yeah. I mean, if you look at 2024 and '23, we averaged right around $202,100 dollars MCPF, and and that has increased. And and I kinda talked about it in the first quarter that there were some marketing initiatives that we were gonna be unlocking this year in in direct response partnerships and and some investments in some of our organic search methods as well. So, you know, we've started to roll that out. Our our cost for the for the quarter was $2.20, so we're definitely making those investments.

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

But we're being, you know, we're being smart smart about it. But those we think that there's continued investments for q three and q three or four that we'll see in MCPF. But the good news is, you know, so far, we've we've been happy with the results and, you know, continuing to learn and find new new methods and channels that that we work that work for us on a scalable way.

Kyle Joseph
Managing Director at Stephens Inc

Got it. Helpful.

Kyle Joseph
Managing Director at Stephens Inc

And then, yeah, just one last one for me, if you don't mind. Just just wanna get your your sense for or or your expectations for for yields given some of the dynamics in the portfolio. Obviously, credit's been good. Kind of a shift towards, you know, larger loans. Obviously, some of that's probably graduating consumers in the in the higher or larger loan balances.

Kyle Joseph
Managing Director at Stephens Inc

But and then at the same time, you're seeing pretty good year over year yield expansion, but just kinda unpack that and give us a sense for where you where you see yields trending for the portfolio over time.

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

Yeah. We think we think it's it's gonna be stable, you know, incrementally increasing to stable. I think, you know, we're we're start we're you know, one of the things we implemented last year was more of a risk risk based pricing approach for different segments, you know, based on credit risk. And so, you know, that's been starting to that was rolled out starting last year and is is now starting to, you know, take shape in the portfolio.

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

But we we feel we feel like it's, you know, at a at a stable level to slightly increasing.

Kyle Joseph
Managing Director at Stephens Inc

Got it. Really helpful. Thanks for taking my all my questions.

Operator

Thank you. Our next question will come from Mike Grondahl with Northland Securities. Your line is open.

Mike Grondahl
Head - Equities & Director - Research at Northland Capital Markets

Hey, guys. Thanks. Another very nice quarter. Pam, maybe the first one for you. You guys had mentioned, like, roughly 10% higher average loan size, maybe a $100 year over year.

Mike Grondahl
Head - Equities & Director - Research at Northland Capital Markets

Do you expect the average loan size to keep creeping up? Have you kind of fully absorbed that increase? Or how should we think about that the next couple quarters?

Pamela Johnson
Pamela Johnson
CFO at OppFi

I would say incrementally, it will creep up a bit. We, again, really haven't seen, I'd say, the full rollout of these larger loans yet at the level that we could be making them. So I think you'll see an incremental increase.

Mike Grondahl
Head - Equities & Director - Research at Northland Capital Markets

Okay. Not huge, but Got it. Got it. Nothing's changed materially in terms of your average loan size, but it's creeping up a little bit.

Mike Grondahl
Head - Equities & Director - Research at Northland Capital Markets

And I think Todd said, hey. Adjust we're kind of adjusting it for inflation, I think, is what I heard, which makes sense. You know, secondly, on credit quality, last week, we kinda had a reset from the government in the jobs data, you know, June, July. Did you guys see that at all? Like, did that cause you guys to rethink a little bit about leaning into growth?

Mike Grondahl
Head - Equities & Director - Research at Northland Capital Markets

I'm just curious kind of kind of how you feel about the macro right now.

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

Yeah. I mean, listen. The the job numbers, you know, are getting revised every month later, and then and they're not even what they you know, so it if they get worse I mean, it's something we watch. It's a macro indicator that we'll watch unemployment. We watch inflation. Those are the two big ones for us that we, you know, kind of it. It's it's not something we're gonna, like, you know, dynamically change the model because of some macro indicator that may not even be, you know, fully accurate. But it is definitely something, you know, we're watching here going into the growth months of the year. I think you have to always be, you know, careful in watching, you know, what what's going on in the economy. You know, it it it's it's things are changing pretty pretty quickly in today's environment.

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

So you can't read and react to everything, but it's definitely something that will inform us. And then also, you know, we have we have very, very good early data to kinda see cracks or see problems kinda well before any economists or anyone due to the, you know, repayment rates kind of and and the default frequency we see. So we can read and react as needed.

Mike Grondahl
Head - Equities & Director - Research at Northland Capital Markets

Got it. And, hey, does that data still look really good?

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

Yeah. I mean I mean, so so far, I mean, like, you know, this is coming off of a tax refund season, you know, you're gonna start to see higher losses for the second half. It's something that, you know, we model and and are prepared for, but it's something we're always, you know, closely watching, especially on new new loan originations. It's something you have to be careful with because because of the environment changes, things can, you know, change as well.

Mike Grondahl
Head - Equities & Director - Research at Northland Capital Markets

Perfect.

Mike Grondahl
Head - Equities & Director - Research at Northland Capital Markets

And then did you guys call out what the collection amount was in February? I I know, you know, two years ago, give or take a little bit, you revamped collections, started being more active there, and I know you've had a lot of success. How was collections in 2Q?

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

Just to just to understand your question, Mike, are you talking about recoveries, like post post charge offs?

Mike Grondahl
Head - Equities & Director - Research at Northland Capital Markets

Yeah. Yeah.

Pamela Johnson
Pamela Johnson
CFO at OppFi

I've got that handy, Mike. Last year, Q2, our recoveries were $8,400,000 and this year, they're $10,692,000 So again, major increase.

Mike Grondahl
Head - Equities & Director - Research at Northland Capital Markets

Got it. Great. And and then just lastly, OpEx was pretty much flat year over year. I think it was roughly $45,000,000. How do we think about the growth there going forward?

Mike Grondahl
Head - Equities & Director - Research at Northland Capital Markets

Should it track revenues? Should it be half of revenue growth? Any any how do you guys think about it?

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

Yeah. No.

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

I don't think if we think about it necessarily as, like, a formula per se. I mean, we're gonna invest when we see the high you know, there's there's a need for there's a need And and I think, you know, I mentioned for the first time our our Lola system or our lending application, Lola. We think that's, you know, a great investment and something that is gonna propel us into the future, allows us to seamlessly integrate in with AI tools that also better integrates all our major systems and is, like, is really gonna, you know, set us up really nicely here once we migrate for the next ten five, ten years, It if not beyond. So, you know, I think I think as far as, like, the corporate and our servicing, we think that, you know, with the team in place, we can we can definitely continue to scale without having to add, you know, maybe some incremental stuff, but without having to add major cost.

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

But, you know, our response to to scaling and continuing to grow is to really, really focus on delivering value to our customers and and really getting our our, you know, all the technical debt and all the the the software that had been built in the past really cleaned up to give us a clean footprint going into this new world where, you know, we know that there's there's these cool AI tools that can benefit not only us operationally, but also our customer experience.

Mike Grondahl
Head - Equities & Director - Research at Northland Capital Markets

Got it. And, hey, I'm sorry. I'll squeeze one more in just with the robust free cash flow. Any updated thoughts on capital allocate capital allocation?

Mike Grondahl
Head - Equities & Director - Research at Northland Capital Markets

You know, I saw you. The dividend was was was what was incremental. How how are you thinking about that?

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

Yeah. We're continuing to explore, you know, opportunities and investment opportunities.

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

And, you know, our goal, Mike, is to be a multiproduct platform for for the alternative credit space to be the leader in that. And, you know, we're seeing some interesting stuff out there. Nothing to report, but, you know, we're we're really happy with the bidding investment that's continuing to perform really well in the SMB space. We're continuing to look at adjacent spaces and point of sale, continuing to look at, you know, the the the the earn with the access space is obviously a very, very hot space. The valuations are, you know, very, very full there, but, you know, they're getting they're getting a lot of credit.

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

It seems like consumers really like the product. Right? A lot of the product market sit there for consumers. So, you know, we're we're we're definitely active looking, you know, where where it can make sense. It's it's gonna be something that, you know, we make sure it really fits within our brand promise and our mission.

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

We don't wanna do anything just to just to say, hey. We did we did an acquisition. It really has to fit our, you know, our footprint and our vision for being a a multiproduct platform, but we're definitely looking at that, you know, closely.

Mike Grondahl
Head - Equities & Director - Research at Northland Capital Markets

Cool. Hey.

Pamela Johnson
Pamela Johnson
CFO at OppFi

Mike, I'd like to add that I'd like to add that, you know, we would be considering stock repurchases. We feel like there's a mismatch between the the the value of the the the enterprise and the stock price.

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

Yeah. Well, I I would I would I would go ahead and say we do think it is disconnected. But, yeah, we we think it's been very, very disconnected. That is another menu option for us as well to protect our, you know, our share price when we we think it's, you know, not valued correctly as well. So

Mike Grondahl
Head - Equities & Director - Research at Northland Capital Markets

Perfect. Perfect. Hey. Thanks, guys.

Operator

Thank you. Our next our last question today will come from Dave Storms with Stonegate. Your line is now open.

Dave Storms
Director - Equity Research at Stonegate Capital Partners

Hey. Good morning, and thanks for taking my questions. Just wanted to circle back to the LOLA initiative. You know, how should we be thinking about that rollout over the next six months? And I guess, what does success look like for that?

Dave Storms
Director - Equity Research at Stonegate Capital Partners

Is it measured in cost or auto approval rates, the number of clicks to originate a loan? Just any more there would be great.

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

Yeah. I mean, I think success is we just continue to achieve the results we're we're getting right now with our current system. The the real value is the ability to to the for the future to really unlock the the full potential of all the new technologies in AI and and plug them in without breaking the system and and being able to seamlessly integrate them.

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

It also really improves our our our data analysis and and connect better in major systems. But it would be to continue to achieve the great results we're getting today and even build upon them incrementally better. But, also, it really just gives us that optionality to be able to deploy new tools in all facets of the business, marketing, credit, operations, you know, even even better, you know, for compliance and and financials as well and data. So it really it really just helps us clean up a lot of the tech footprint we had over the last, you know, ten years that we've built and and improve on it.

Dave Storms
Director - Equity Research at Stonegate Capital Partners

That's perfect.

Dave Storms
Director - Equity Research at Stonegate Capital Partners

And then just one more for me. Your guidance takes into account, the second half being seasonally softer. Are you seeing anything in the macro that would throw off the seasonal distribution between 3Q and 4Q?

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

Your can you can you be a little more specific just to make sure I answer your question correctly?

Dave Storms
Director - Equity Research at Stonegate Capital Partners

Yeah.

Dave Storms
Director - Equity Research at Stonegate Capital Partners

Of course. So your guidance takes into account the second half being seasonally softer as it normally is. Should we expect 3Q and 4Q to be seasonally in line with our typical seasonal trends? Or are you seeing anything in the macro picture that might throw that off?

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

Yeah.

Todd Schwartz
Founder, CEO & Executive Chairman at OppFi

No. I think I mean, listen. I think as you as you start to grow more, you know, there's cost associated with that and, obviously, you know, charge offs, you know, build a little bit until you kinda reset the So, I mean, I think we're we're seeing a a pretty a pretty, you know, standard, process there, but, you know, nothing nothing to to call out, out of the ordinary.

Dave Storms
Director - Equity Research at Stonegate Capital Partners

Perfect.

Dave Storms
Director - Equity Research at Stonegate Capital Partners

Thank you for taking my questions, and good luck in third quarter.

Operator

Thank you. Ladies and gentlemen, this concludes today's event. You may now disconnect.

Executives
Analysts
    • Todd Schwartz
      Founder, CEO & Executive Chairman at OppFi
    • David Scharf
      Analyst at Citizens Capital Markets and Advisory
    • Kyle Joseph
      Managing Director at Stephens Inc
    • Mike Grondahl
      Head - Equities & Director - Research at Northland Capital Markets
    • Dave Storms
      Director - Equity Research at Stonegate Capital Partners
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