Credit Acceptance (CACC) Financials

Credit Acceptance’s (NASDAQ:CACC) second-quarter 2026 results show a meaningful recovery in profitability and operating cash flow compared with the same quarter last year. Revenue increased to $480.0 million from $465.7 million, while net income rose to $135.9 million from $87.4 million. Diluted earnings per share increased to $12.66 from $7.42, helped by both stronger earnings and a lower share count.

The improvement follows a difficult period in mid-2024, when Credit Acceptance reported a $47.1 million quarterly loss after a $320.6 million credit-loss provision and a $23.7 million investment loss. Profitability recovered to $106.3 million in the first quarter of 2025 and has generally strengthened since then, although second-quarter 2026 earnings were essentially flat compared with the $135.8 million reported in the first quarter.

• Profitability rebounded sharply: Q2 2026 net income increased 55.5% year over year to $135.9 million, and diluted EPS rose 70.6% to $12.66.
• Revenue continued to grow: Total revenue rose 3.1% year over year to $480.0 million. Service charges on deposit accounts, the company’s largest reported revenue source, increased to $546.2 million from $540.7 million.
• Credit-loss provisions moderated: The provision for credit losses declined to $159.2 million from $172.6 million in Q2 2025. It was higher than the $139.6 million recorded in Q1 2026, but remains well below the unusually high $320.6 million provision in Q2 2024.
• Operating expenses improved: Total non-interest expense fell to $152.2 million from $175.3 million a year earlier, with lower salaries, marketing, insurance claims and other operating expenses.
• Operating cash flow remained strong: Cash flow from operations rose to $309.5 million in Q2 2026 from $139.7 million in Q2 2025. Operating cash flow has remained positive in every supplied quarter, generally exceeding reported net income.
• Share repurchases supported per-share results: Credit Acceptance repurchased $141.4 million of common stock during Q2 2026. Basic weighted-average shares declined to 10.5 million from 11.6 million a year earlier and 13.1 million in Q1 2023.
• Liquidity pressure eased compared with last year: Net cash decreased by $59.3 million in Q2 2026, a significant improvement from the $556.8 million decline in Q2 2025. The company also generated enough operating cash to help fund investment purchases and shareholder returns.
• Debt refinancing remains central to the business: Credit Acceptance issued $2.97 billion of debt and repaid $3.09 billion in Q2 2026, producing a net financing outflow of $197.4 million. The large gross borrowing activity suggests ongoing reliance on capital-market access even though net debt was reduced during the quarter.
• Investment cash flows are volatile: The company continues to purchase and sell large volumes of investment securities. Q2 2026 investing cash flow was negative $171.4 million, while prior quarters ranged from negative $526.0 million to negative $60.9 million, making cash trends difficult to evaluate from one quarter alone.
• Leverage remains high: At June 30, 2026, total liabilities were $7.03 billion compared with $1.59 billion of equity, implying liabilities of roughly 4.4 times equity. Long-term debt was $6.11 billion, leaving earnings sensitive to funding costs and credit-market conditions.

Overall, the financial statements point to improving earnings quality compared with 2024 and early 2025. Lower credit-loss provisions, reduced operating expenses, strong operating cash generation and continued share repurchases are favorable for shareholders. However, investors should continue monitoring loan performance, provisions, interest expense and debt-market access because the company’s highly leveraged model can produce substantial swings in earnings and cash flow.