Ally Financial (ALLY) Financials

Ally Financial (NYSE: ALLY) has shown various financial trends over the last several quarters from Q3 2022 through Q1 2025. Based on the analysis of their income statements, cash flow statements, and balance sheets for this period, here are the key takeaways:

• Stable Interest Income: Loan and lease interest income has generally trended upward over the quarters, growing from approximately $2.53 billion in Q3 2022 to above $3.06 billion in Q1 2025, indicating consistent loan portfolio performance.
• Strong Net Interest Income: Net interest income remains robust, with quarterly figures consistently over $1.4 billion, reaching $1.48 billion in Q1 2025, showing effective interest margin management despite rising interest expenses.
• Solid Operating Cash Flows: Net cash from continuing operating activities remains positive and substantial, with $940 million generated in Q1 2025 and similarly strong figures in previous quarters, reflecting good cash generation capacity.
• Consistent Dividend Payouts: Ally continues to pay a quarterly cash dividend of $0.30 per common share consistently across all recent quarters, signaling commitment to shareholder returns.
• Reduction in Weighted Average Shares: Weighted average basic shares outstanding slightly decreased from around 316 million in early 2022 to about 309 million in Q1 2025, indicating potential share repurchases contributing to EPS support.

• Fluctuating Non-Interest Income: Non-interest income has shown volatility, with net realized and unrealized capital gains ranging from positive to significant losses, including a substantial $-498 million loss in Q1 2025, impacting total revenue.
• Asset Growth Moderate: Total assets have fluctuated around $190B to $197B range over the last few years, with no significant growth spikes seen recently, indicating a stable asset base.
• Stable Liability Structure: Total liabilities remain relatively stable near $176B to $183B over several quarters, with deposits forming the large majority, and long-term debt fluctuating modestly.

• Quarterly Net Loss in Q1 2025: Ally reported a consolidated net loss of $225 million in Q1 2025, a deterioration from modest profits in previous quarters, reflecting net realized and unrealized losses and increased provisions.
• Rising Provision for Credit Losses: The provision for credit losses increased to $191 million in Q1 2025, indicating anticipated higher potential loan defaults that weigh on profitability.
• Increasing Non-Interest Expenses: Non-interest expenses grew significantly to $1.63 billion in Q1 2025 from prior levels around $1.2-$1.4 billion, driven by salaries, other operating expenses, and a $305 million impairment charge, pressuring margins.
• Elevated Interest Expenses: Interest expenses remain high, at around $1.9 billion in Q1 2025, reflecting cost of funding pressures from deposits, borrowings, and long-term debt servicing.
• Declining Earnings Per Share (EPS): Basic and diluted EPS fell to -$0.82 in Q1 2025, a sharp decline from positive EPS above $0.80 in earlier quarters, signaling worsening profitability driven by the factors above.

Summary: Ally Financial has maintained stable core interest income and strong operating cash flows with consistent dividend payments. However, recent quarters, especially Q1 2025, show pressure from volatile investment income losses, increased credit loss provisions, growing operating expenses, and high interest costs. These factors led to quarterly net losses and negative EPS. Investors should monitor how Ally manages credit risks and operating expenses going forward to return to profitability while maintaining its asset and deposit base.