Enova International Q2 Earnings Call Highlights

Key Points

• Enova beat Q2 expectations with revenue up 22% to $929 million and adjusted EPS up 33% to $4.31, driven by 27% growth in consolidated originations and continued operating leverage.
• Credit performance improved, with the consolidated net charge-off ratio falling to 7.3% from 8.1% a year ago; consumer credit was notably stronger while small business credit stayed stable.
• Management raised the full-year outlook, now forecasting 2026 revenue growth of 20% to 25% and adjusted EPS growth of 30% to 35%, while also reiterating that the Grasshopper Bank acquisition remains on track to close later this year.

Enova International NYSE: ENVA reported second-quarter 2026 results that topped management's expectations, driven by higher originations across both its consumer and small business lending businesses, stable credit performance and continued operating leverage.

Chief Executive Officer Steve Cunningham said healthy originations growth and credit, supported by a stable macroeconomic environment, drove financial results that exceeded the company's expectations. Consolidated originations rose 27% year over year to nearly $2.3 billion, marking the 11th consecutive quarter in which Enova posted year-over-year consolidated originations growth of 20% or more.

The company's portfolio grew 28% from the prior year to $5.5 billion. Small business products represented 69% of the portfolio, while consumer products accounted for 31%.

"Our second quarter results and our long track record of consistent and differentiated financial performance reflect the strength and resiliency of our business," Cunningham said, citing Enova's diversified product offerings, scalable operating model and risk management capabilities.

Revenue and Earnings Growth Accelerate

Chief Financial Officer Scott Cornelis said total company revenue increased 22% year over year to $929 million, supported by 28% growth in combined loan and finance receivable balances on an amortized basis.

Adjusted earnings per share, a non-GAAP measure, increased 33% from the second quarter of 2025 to $4.31 per diluted share. Cunningham said the quarter marked Enova's eighth consecutive quarter of year-over-year adjusted EPS growth of 30% or more. Cornelis said the result translated to an annualized quarterly return on equity above 30%.

Small business lending revenue rose 35% from the prior-year quarter to $439 million, while small business receivables ended the quarter at $3.8 billion, up 36% year over year. Small business originations grew 29% to $1.6 billion.

Consumer revenue increased 11% year over year to $477 million, with consumer receivables ending the quarter at $1.7 billion, approximately 14% above the year-ago period. Consumer originations rose 23% to $691 million, which Cornelis said reflected stronger demand and solid credit during the quarter.

Credit Performance Improves, Led by Consumer Portfolio

Credit performance was a key contributor to earnings growth. Enova's consolidated net charge-off ratio was 7.3% in the second quarter, down from 8.1% a year earlier and 7.6% in the first quarter. Cunningham said the metric was the best the company had seen "in quite some time," as consumer credit improved and small business credit remained stable.

The consumer net charge-off ratio improved to 12.8%, down 170 basis points from the second quarter of 2025. The small business net charge-off ratio was 4.8%, roughly in line with 4.7% a year earlier.

Cornelis said the consolidated net revenue margin was 61%, slightly better than expected. The consolidated fair value premium remained at approximately 115%, consistent with levels seen over the past two years, while the consolidated 30-plus day delinquency rate ended the quarter at 7.5%, essentially flat with the first quarter.

During the question-and-answer session, Cunningham said Enova's risk appetite had not changed in either the consumer or small business portfolios. He attributed consumer volume growth to healthy demand and the company's ability to capture that demand within its existing unit economics framework. He also noted that some consumer growth came from the line-of-credit product, which had faced a softer comparison after the company slowed activity in that area last year.

Marketing Spend Rises as Originations Grow

Operating expenses, including marketing, were 35% of revenue in the second quarter, compared with 32% a year earlier. Marketing costs were $204 million, or 22% of revenue, up from $143 million, or 19% of revenue, in the second quarter of 2025.

Cunningham said marketing should be viewed as an output of meeting market demand rather than a decision to "lean in" more aggressively. He said the company's technology, analytics and real-time feedback allow it to respond quickly to demand while maintaining its return and credit standards.

Operations and technology expenses were $75 million, or 8.1% of revenue, compared with $64 million, or 8.3% of revenue, a year earlier. General and administrative expenses were $44 million, or 4.7% of revenue, including $1.5 million of deal-related expenses associated with the pending Grasshopper Bank acquisition.

Grasshopper Bank Deal Remains on Track

Enova reiterated that it expects to close its planned combination with Grasshopper Bank later this year. Cunningham said the company remains in "constructive dialogue" with both the Office of the Comptroller of the Currency and the Federal Reserve as the agencies continue reviewing the application.

Cunningham said integration planning is largely complete and that Enova expects to move quickly after receiving approval. He said anticipated synergies include geographic expansion of existing products and lower funding costs from Grasshopper's deposit business.

Management repeated its expectation that net synergies from the transaction will drive adjusted EPS accretion of more than 25% once fully realized within the first two years after closing. Cornelis said Enova's 2026 financial expectations do not assume any contribution from the pending acquisition.

In response to an analyst question, Cunningham said the national bank charter would allow Enova to expand its NetCredit consumer products into new geographies. He also said Grasshopper's existing small business capabilities could serve as an adjacency to Enova's current small business programs.

Management Raises Full-Year Outlook

Enova ended the second quarter with approximately $929 million of liquidity, including $478 million of cash and marketable securities and $451 million of available capacity on debt facilities. Its cost of funds was 8.1%, down from 8.2% in the first quarter and 8.8% a year earlier. The company also repurchased approximately 117,000 shares during the quarter for about $19 million.

For the third quarter of 2026, Enova expects consolidated revenue to be around 25% higher year over year and net revenue margin to be in the 55% to 60% range. Management expects marketing expense to be around 20% of revenue, operations and technology costs to be around 8% to 8.5% of revenue, and general and administrative costs to be around 5% of revenue.

Those expectations should lead to third-quarter adjusted EPS growth of around 30% from the third quarter of 2025, Cornelis said.

For the full year, Enova now expects revenue growth of 20% to 25% compared with 2025 and adjusted EPS growth of 30% to 35%. Cornelis said the outlook depends on the macroeconomic environment and its effects on demand, customer payment rates, and the level, timing and mix of originations growth.

About Enova International (NYSE:ENVA)

Enova International, Inc NYSE: ENVA is a Chicago-based financial services company specializing in online lending solutions. Since its founding in 2004, Enova has leveraged proprietary data analytics and technology platforms to underwrite and deliver short-term consumer loans, lines of credit and installment loans. Through its flagship consumer brand NetCredit, Enova provides flexible credit options designed to serve a wide range of borrowers, including those with limited or non-traditional credit histories.

In addition to its U.S.

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