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Dec 31, 2025
World Acceptance Q3 2026 Earnings Report
World Acceptance Corporation reports a net loss of $0.9 million in the third quarter of fiscal 2026, a decrease from net income of $13.4 million in the same quarter of the prior year, primarily due to increased provision for credit losses and higher general and administrative expenses.
Key Takeaways
World Acceptance Corporation experienced a challenging third quarter of fiscal 2026, reporting a net loss of $0.9 million, a significant decline from the $13.4 million net income in the prior year's comparable quarter. This was largely driven by a substantial increase in the provision for credit losses, up $7.3 million to $51.4 million, and a 16.1% rise in general and administrative expenses. Despite these headwinds, total revenues saw a modest increase of 1.9% to $141.3 million, and the company achieved growth in its outstanding loans and customer base, reflecting a strategic shift towards targeted portfolio growth.
Net loss for the third quarter was $912,000, a decrease from net income of $13,388,000 in the same quarter of the prior year.
Total revenues increased by 1.9% to $141,252,000, driven by a 2.7% increase in interest, fee, and insurance income.
Provision for credit losses rose by $7,300,000 to $51,423,000, primarily due to new loan growth and an increased proportion of new customers in the portfolio.
General and administrative expenses increased by 16.1% to $78,057,000, largely due to a $5,000,000 increase in share-based compensation expense and higher field-level incentives.
Revenue by Segment
Forward Guidance
The Company anticipates that investments made in the portfolio this year will begin to yield positive results in the next fiscal year. They expect continued targeted growth with a lower proportion of new customers, leading to improved profitability.
Positive Outlook
- Investments in the portfolio are expected to pay off towards the next fiscal year.
- Continued targeted growth with fewer new customers as a percentage of the mix is anticipated.
- Lower charge-offs and reserve rates are expected as new customers gain tenure.
- Improved profitability is projected as growth becomes more widely dispersed.
- Expect a 3-5% reduction in headcount moving forward as staffing levels are right-sized.
Challenges Ahead
- The current quarter's net loss was significantly impacted by increased provision for credit losses.
- New customers, while performing well, carry a substantially higher reserve for loan losses.
- The company was required to rebuild its allowance for credit losses due to the targeted growth strategy.
Historical Earnings Impact
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