CPSS Reports Earnings
View original at nasdaq.comCPSS Reports Earnings Image source: The Motley Fool. DATE March 11, 2026, 1 p.m. ET CALL PARTICIPANTS Chief Executive Officer — Charles BradleyChief Financial Officer — Danny BharwaniChief Operating Officer — Michael Lavin Need a quote from a Motley Fool analyst?…
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Employee costs as percentage of portfolio declined from 2.6% to 2.4% despite 8.24% portfolio growth, showing proper scaling
60% confidence2024 and 2025 vintages showing significantly better credit performance than 2022-2023 vintages due to credit tightening
60% confidencePortfolio size of nearly $4 billion provides strong industry competitive positioning
60% confidenceGeneration 9 credit model increased approvals by 11%, from low 40% range to low 50% range, while maintaining capture rate
60% confidenceInterest rates expected to remain stable or decline, with unemployment steady, creating favorable environment for 2026
60% confidence2025 was a very good year, though growth fell short of expectations
60% confidenceImproved portfolio delinquency performance in 2025 despite macroeconomic headwinds is a significant accomplishment
60% confidenceMinimum portfolio size of $1 billion needed to be competitive in subprime auto lending industry
60% confidenceCPSS ranks among the best credit performers in subprime space based on Intex data used by bond investors
60% confidenceExcluding fair value marks, pretax income improved significantly to $21.5 million in 2025 from $6.4 million in 2024
60% confidenceRecoveries expected to normalize to low 40% range once 2022-2023 vintages run off by end of 2026
60% confidence2026 goals focus on portfolio growth, margin improvement through better interest rates, and improved performance by eliminating 2022-2023 vintages
60% confidenceLegacy 2022-2023 loans that were unprofitable represented nearly 40% of portfolio at start of 2025, expected to become de minimis by end of 2026
60% confidenceCredit is readily available and multiple banks are eager to lend or buy CPSS bonds
60% confidenceGLS acquisition set favorable valuation benchmark for subprime auto lending industry
60% confidencePrime lending program growth will be gradual, similar to near-prime program that eventually reached 5-6% of originations
60% confidenceInterest income growth of 16% year-over-year is the main driver of total revenue increase
60% confidence2025 originations of $1.638 billion made it the third-best year in company's 35-year history despite headwinds
60% confidenceCore operating expenses declined as percentage of managed portfolio from 5.6% to 4.8%, demonstrating scaling benefits
60% confidenceTarget to increase monthly application volume from 250,000 to 325,000
60% confidence