CREDIT ACCEPTANCE CORP
For the period ended Sep 30, 2025. Filed Oct 30, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2025 · Filed Oct 30, 2025
CACC$529.56+1.3%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-06-30; filed 2025-07-31.
0000885550-25-000085
Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSCurrent report: 10-Q
Period ended 2025-09-30; filed 2025-10-30.
0000885550-25-000124
Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 167 previous paragraphs and 167 current paragraphs.
107 unchanged; 48 reworded; 11 added; 9 removed; 3 previous and 1 current paragraphs rearranged.
Tables are not compared: 24 previous and 24 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (11)
Current report
•Received the following awards:
Current report
•Financial Services Top Workplaces for the second consecutive year, with a #4 ranking in the 1,000+ employee size category.
Current report
•Crain’s Fast 50 list by Crain's Detroit Business for the ninth time.
Current report
•PEOPLE 100 Companies that Care® by PEOPLE magazine and Great Place to Work®, for the fourth consecutive year, with a #44 ranking.
Current report
•Fortune Best Workplaces in Financial Services and Insurance TMby Great Place to Work® and Fortunefor the eleventh consecutive year, with a #10 ranking in the large company category.
Current report
•An increase in general and administrative expense of $7.3 million, or 25.2%, primarily due to an increase in legal expenses, which included a $15.0 million contingent loss recognized during the third quarter of 2025 compared to a $7.4 million contingent loss recognized during the third quarter of 2024, both related to previously disclosed legal matters as to which we have recognized cumulative contingent losses of $46.8 million through the end of the third quarter of 2025. The cumulative amount reflects, among other things, a September 2025 offer by us to settle the previously disclosed multi-state and New York Attorney General legal matters on terms that include, among other things, a proposed cash payment of $45.0 million.
Current report
Nine Months Ended September 30, 2025 Compared to Nine Months Ended September 30, 2024
Current report
•An increase in general and administrative expense of $27.7 million, or 36.5%, primarily due to an increase in legal expenses, which included a $38.4 million contingent loss recognized during the first nine months of 2025, compared to an $8.4 million contingent loss recognized during the first nine months of 2024, both related to previously disclosed legal matters as to which we have recognized cumulative contingent losses of $46.8 million through the end of the third quarter of 2025. The cumulative amount reflects, among other things, a September 2025 offer by us to settle the previously disclosed multi-state and New York Attorney General legal matters on terms that include, among other things, a proposed cash payment of $45.0 million.
Current report
We endeavor to run our business conservatively, with a large margin of safety in Loan pricing in the aggregate, low leverage on the balance sheet, and significant unused availability on our revolving credit facilities. Our forecasting models have performed best during relatively stable economic periods but have been less accurate during periods of volatility like we have experienced in recent years. Since forecasting collection rates is challenging, our business model is designed to produce acceptable returns in the aggregate even if Loan performance is worse than forecasted. When needed, we have made adjustments to our forecasts on both new and existing Loans, and our recent forecasts incorporate underperformance of post-pandemic vintages. We have also reduced advance rates to the Dealer on more recent vintages, which we believe increases the margin of safety in our business. Based on our current estimates, total forecasted collections for the portfolio as of September 30, 2025 are $12.3 billion, which provides over $4.5 billion of cushion to our lenders after considering $1.4 billion of estimated interest and operating expenses and $6.4 billion of outstanding debt.
Current report
Since 1998, we have completed 59 term securitizations totaling $16.6 billion of debt issued. We believe our securitization trusts contain a significant margin of safety for investors, including structural features such as overcollateralization, subordination, and reserve accounts to protect our investors against credit risk. Our securitization trusts have paid timely interest and principal of all maturing securities in full and have never experienced an early amortization event, event of default, or other adverse event that would cause early or late repayment. Our securitization transactions are generally structured to withstand a 35% decline in the forecasted collection rate before the most junior bond is at risk of taking a principal loss. Accordingly, we believe future net cash flows from collateral securing our outstanding securitization debt are more than sufficient to repay all future obligations of our outstanding securitization trusts.
Current report
On September 19, 2025, we extended the date on which our $200.0 million Warehouse Facility VIII will cease to revolve from September 21, 2026 to September 19, 2028. The interest rate on borrowings under the facility has been decreased from SOFR plus 225 basis points to SOFR plus 185 basis points.
Removed paragraphs (9)
Previous report
•Named one of the 100 Best Companies to Work For®by Great Place to Work® and Fortune magazine for the eleventh time, with a #34 ranking, and a Spring 2025 Top Workplaces Culture Excellence award winner in the following five categories: Work-Life Flexibility, Leadership, Innovation, Purpose & Values, and Compensation & Benefits.
Previous report
•An increase in general and administrative expense of $22.0 million, or 94.8%, primarily due to an increase in legal expenses, which included the recognition of a $23.4 million contingent loss during the second quarter of 2025 related to previously disclosed legal matters.
Previous report
Six Months Ended June 30, 2025 Compared to Six Months Ended June 30, 2024
Previous report
Other Income. The increase of $6.8 million, or 20.5%, was primarily due to:
Previous report
•A $4.0 million increase in interest income primarily due to income earned on the investment of excess cash balances.
Previous report
•A $2.5 million increase in ancillary product profit sharing income primarily due to growth in our Loan portfolio and an increase in the average cost of premiums written on vehicle service contracts.
Previous report
•An increase in general and administrative expense of $20.4 million, or 43.5%, primarily due to an increase in legal expenses, which included the recognition of a $23.4 million contingent loss during the first six months of 2025 related to previously disclosed legal matters.
Previous report
During the first six months of 2024, we decreased our estimate of future net cash flows by $220.1 million, or 2.2%, to reflect a decline in forecasted collection rates during the period and slowed our forecasted net cash flow timing to reflect a decrease in Consumer Loan prepayments, which remained below historical averages. The $220.1 million decrease in forecasted net cash flows for the first six months of 2024 was composed of an ordinary decrease in forecasted net cash flows of $72.9 million, or 0.8%, and an adjustment applied to our forecasting methodology, which upon implementation, reduced forecasted net cash flows by $147.2 million, or 1.4%, and increased our provision for credit losses by $127.5 million. Consumer Loans assigned in 2022 had continued to underperform our expectations for several quarters. Consumer Loans assigned in 2023 had also begun exhibiting similar trends of underperformance, although not as severe as Consumer Loans assigned in 2022. During the first six months of 2024, we determined that we had sufficient Consumer Loan performance experience to estimate the magnitude by which we expected Consumer Loans assigned in 2022 through 2024 would likely underperform our historical collection rates on Consumer Loans with similar characteristics. Accordingly, we applied an adjustment to Consumer Loans assigned in 2022 through 2024 to reduce forecasted collection rates to what we believed the ultimate collection rates would be based on these trends.
Previous report
The 13.6% decrease in provision for credit losses related to new Consumer Loan assignments was due to a 12.2% decrease in Consumer Loan assignment unit volume and a 1.6% decrease in the average provision per Consumer Loan assignment. The decrease in the average provision per Consumer Loan assignment was due to a decrease in the average advance rate for 2025 Consumer Loans.
Reworded paragraphs (48)
Previous wording
For the three months ended June 30, 2025, consolidated net income was $87.4 million, or $7.42 per diluted share, compared to consolidated net loss of $47.1 million, or $3.83 per diluted share, forthe same period in 2024. Theincrease was primarily due to a decrease in provision for credit losses and an increase in finance charges, partially offset by increases in provision for income taxes and operating expenses. Our results and achievements for the three months ended June 30, 2025 included the following:
Current wording
For the three months ended September 30, 2025, consolidated net income was $108.2 million, or $9.43 per diluted share, compared to consolidated net income of $78.8 million, or $6.35 per diluted share, forthe same period in 2024. The increase was primarily due to a decrease in provision for credit losses and an increase in finance charges, partially offset by an increase in operating expenses. Our results and achievements for the three months ended September 30, 2025 included the following:
Previous wording
•A 6.8% increase in the average balance of our Loan portfolio from the second quarter of 2024 to $8.0 billion, which is our largest ever.
Current wording
•A 3.9% increase in the average balance of our Loan portfolio from the third quarter of 2024 to $8.0 billion.
Previous wording
•A decline in Consumer Loan assignment unit and dollar volumes of 14.6% and 18.8%, respectively, as compared to the second quarter of 2024.
Current wording
•A decline in Consumer Loan assignment unit and dollar volumes of 16.5% and 19.4%, respectively, as compared to the third quarter of 2024.
Previous wording
•A decline in forecasted collection rates, which decreased forecasted net cash flows from our Loan portfolio by $55.8 million, or 0.5%, and slower forecasted net cash flow timing.
Current wording
•A decline in forecasted collection rates, which decreased forecasted net cash flows from our Loan portfolio by $58.6 million, or 0.5%, and slower forecasted net cash flow timing.
Previous wording
•The repurchase of approximately 530,000 shares, or 4.5% of the shares outstanding at the beginning of the quarter.
Current wording
•$107.4 million in the repurchase of approximately 230,000 shares, or 2.0% of the shares outstanding at the beginning of the quarter.
Previous wording
•The enrollment of 1,560 new Dealers, with 10,655 active Dealers during the quarter.
Current wording
•The enrollment of 1,342 new Dealers, with 10,180 active Dealers during the quarter.
Previous wording
•$63.3 million in Dealer Holdback and accelerated Dealer Holdback payments to Dealers.
Current wording
•$51.9 million in Dealer Holdback and accelerated Dealer Holdback payments to Dealers.
Previous wording
•$23.4 million contingent loss related to previously disclosed legal matters.
Current wording
•$15.0 million contingent loss related to previously disclosed legal matters.
Previous wording
For thesix months ended June 30, 2025, consolidated net income was $193.7 million, or $16.11 per diluted share, compared to consolidated net income of $17.2 million, or $1.37 per diluted share, for the same period in 2024. The increase was primarily due to a decrease in provision for credit losses and an increase in finance charges, partially offset by increases in provision for income taxes and operating expenses. Our results and achievements for the six months ended June 30, 2025 included the following:
Current wording
For thenine months ended September 30, 2025, consolidated net income was $301.9 million, or $25.50 per diluted share, compared to consolidated net income of $96.0 million, or $7.68 per diluted share, for the same period in 2024. The increase was primarily due to a decrease in provision for credit losses and an increase in finance charges, partially offset by an increase in operating expenses. Our results and achievements for the nine months ended September 30, 2025 included the following:
Previous wording
•An 8.9% increase in the average balance of our Loan portfolio from the first six months of 2024 to $7.9 billion.
Current wording
•A 7.1% increase in the average balance of our Loan portfolio from the first nine months of 2024 to $8.0 billion.
Previous wording
•A decline in Consumer Loan assignment unit and dollar volumes of 12.2% and 17.1% respectively, as compared to the first six months of 2024.
Current wording
•A decline in Consumer Loan assignment unit and dollar volumes of 13.5% and 17.8% respectively, as compared to the first nine months of 2024.
Previous wording
•A decline in forecasted collection rates, which decreased forecasted net cash flows from our Loan portfolio by $76.7 million, or 0.7%, and slower forecasted net cash flow timing.
Current wording
•A decline in forecasted collection rates, which decreased forecasted net cash flows from our Loan portfolio by $135.3 million, or 1.2%, and slower forecasted net cash flow timing.
Previous wording
•The repurchase of approximately 859,000 shares, or 7.1% of the shares outstanding at the beginning of the year.
Current wording
•$534.0 million in the repurchase of approximately 1,089,000 shares, or 9.0% of the shares outstanding at the beginning of the year.
Previous wording
•The enrollment of 3,205 new Dealers, with 13,008 active Dealers during the first six months of 2025.
Current wording
•The enrollment of 4,547 new Dealers, with 14,483 active Dealers during the first nine months of 2025.
Previous wording
•$131.3 million in Dealer Holdback and accelerated Dealer Holdback payments to Dealers.
Current wording
•$183.2 million in Dealer Holdback and accelerated Dealer Holdback payments to Dealers.
Previous wording
•$23.4 million contingent loss related to previously disclosed legal matters.
Current wording
•$38.4 million contingent loss related to previously disclosed legal matters.
Previous wording
•Received awards from Great Place to Work®and Fortune magazine and from Top Workplaces USA.
Current wording
•Received awards from Great Place to Work®and Fortune magazine, PEOPLE magazine, Top Workplaces USA, and Crain's Detroit Business.
Previous wording
For the three months ended June 30, 2025, forecasted collection rates improved for Consumer Loans assigned in 2025, declined for Consumer Loans assigned in 2022 through 2024, and were generally consistent with expectations at the start of the period for all other assignment years presented. For the six months ended June 30, 2025, forecasted collection rates improved for Consumer Loans assigned in 2020, declined for Consumer Loans assigned in 2022 through 2024, and were generally consistent with expectations at the start of the period for all other assignment years presented.
Current wording
For the three months ended September 30, 2025, forecasted collection rates improved for Consumer Loans assigned in 2025, declined for Consumer Loans assigned in 2022 through 2024, and were generally consistent with expectations at the start of the period for all other assignment years presented. For the nine months ended September 30, 2025, forecasted collection rates improved for Consumer Loans assigned in 2020, declined for Consumer Loans assigned in 2022 through 2024, and were generally consistent with expectations at the start of the period for all other assignment years presented.
Previous wording
(3)Represents activity for the six months ended June 30, 2025. Information in this table for each of the years prior to 2025 represents activity for all 12 months of that year.
Current wording
(3)Represents activity for the nine months ended September 30, 2025. Information in this table for each of the years prior to 2025 represents activity for all 12 months of that year.
Previous wording
(4)The averages for 2025 Consumer Loans include both Consumer Loans that were in our portfolio as of March 31, 2025 and Consumer Loans assigned
Current wording
(4)The averages for 2025 Consumer Loans include both Consumer Loans that were in our portfolio as of June 30, 2025 and Consumer Loans assigned during the most recent quarter. The following table provides averages for each of these segments:
Previous wording
The spread between the forecasted collection rate as of June 30, 2025 and the advance rate ranges from 12.3% to 24.1%, on an annual basis, for Consumer Loans assigned over the last 10 years. The spreads with respect to 2019 and 2020 Consumer Loans have been positively impacted by Consumer Loan performance, which has exceeded our initial estimates by a greater margin than the other years presented. The spreads with respect to 2021 through 2024 Consumer Loans have been negatively impacted by Consumer Loan performance, which has been lower than our initial estimates by a greater margin than the other years presented. The higher spread for 2025 Consumer Loans relative to 2024 Consumer Loans as of June 30, 2025 was primarily a result of Consumer Loan performance, as the performance of 2024 Consumer Loans has been lower than our initial estimates.
Current wording
The spread between the forecasted collection rate as of September 30, 2025 and the advance rate ranges from 11.9% to 24.1%, on an annual basis, for Consumer Loans assigned over the last 10 years. The spreads with respect to 2019 and 2020 Consumer Loans have been positively impacted by Consumer Loan performance, which has exceeded our initial estimates by a greater margin than the other years presented. The spreads with respect to 2021 through 2023 Consumer Loans have been negatively impacted by Consumer Loan performance, which has been lower than our initial estimates by a greater margin than the other years presented. The higher spread for 2025 Consumer Loans relative to 2024 Consumer Loans as of September 30, 2025 was primarily a result of Consumer Loan performance, as the performance of 2024 Consumer Loans has been lower than our initial estimates.
Previous wording
The spread as of June 30, 2025 on 2025 Dealer Loans was 22.3%, as compared to a spread of 20.4% on 2024 Dealer Loans. The increase was primarily a result of Consumer Loan performance, as the performance of 2024 Dealer Loans has been lower than our initial estimates.
Current wording
The spread as of September 30, 2025 on 2025 Dealer Loans was 22.4%, as compared to a spread of 20.2% on 2024 Dealer Loans. The increase was primarily a result of Consumer Loan performance, as the performance of 2024 Dealer Loans has been lower than our initial estimates.
Previous wording
The spread as of June 30, 2025 on 2025 Purchased Loans was 21.2%, as compared to a spread of 21.1% on 2024 Purchased Loans, reflecting the net impact of two offsetting factors. Consumer Loan performance increased the spread from 2024 to 2025, as the performance of 2024 Purchased Loans has been lower than our initial estimates. This impact of Consumer Loan performance was partially offset by the impact of a lower initial spread on 2025 Purchased Loans, due to the advance rate increasing by a greater margin than the initial forecast in our Purchased Loan portfolio.
Current wording
The spread as of September 30, 2025 on 2025 Purchased Loans was 21.3%, as compared to a spread of 21.0% on 2024 Purchased Loans, reflecting the net impact of two offsetting factors. Consumer Loan performance increased the spread from 2024 to 2025, as the performance of 2025 Purchased Loans has exceeded our initial estimates while the performance of 2024 Purchased Loans has been lower than our initial estimates. This impact of Consumer Loan performance was partially offset by the impact of a lower initial spread on 2025 Purchased Loans, due to the advance rate increasing by a greater margin than the initial forecast in our Purchased Loan portfolio.
Previous wording
Our strategy for accessing capital on acceptable terms needed to maintain and grow the business is to: (1) maintain consistent financial performance; (2) maintain modest financial leverage; and (3) maintain multiple funding sources. Our funded debt to equity ratio was 4.2 to 1 as of June 30, 2025. We currently utilize the following primary forms of debt financing: (1) our revolving secured line of credit facility; (2) Warehouse facilities; (3) Term ABS financings; and (4) senior notes.
Current wording
Our strategy for accessing capital on acceptable terms needed to maintain and grow the business is to: (1) maintain consistent financial performance; (2) maintain modest financial leverage; and (3) maintain multiple funding sources. Our funded debt to equity ratio was 4.0 to 1 as of September 30, 2025. We currently utilize the following primary forms of debt financing: (1) our revolving secured line of credit facility; (2) Warehouse facilities; (3) Term ABS financings; and (4) senior notes.
Previous wording
Unit and dollar volumes declined 14.6% and 18.8%, respectively, during the second quarter of 2025 as the number of active Dealers declined 0.8% and the average unit volume per active Dealer declined 14.0%. Dollar volume declined by more than unit volume during the second quarter of 2025 due to a decrease in the average advance paid, primarily resulting from a decrease in the average size of Consumer Loans assigned. Unit volume for the 28-day period ended July 28, 2025 decreased 19.4% compared to the same period in 2024.
Current wording
Unit and dollar volumes declined 16.5% and 19.4%, respectively, during the third quarter of 2025 as the number of active Dealers declined 4.7% and the average unit volume per active Dealer declined 12.2%. Dollar volume declined by more than unit volume during the third quarter of 2025 due to a decrease in the average advance paid, primarily resulting from a decrease in the average size of Consumer Loans assigned. Unit volume for the 28-day period ended October 28, 2025 decreased 13.0% compared to the same period in 2024.
Previous wording
As of both June 30, 2025 and December 31, 2024, the net Dealer Loans receivable balance was 72.3% of the total net Loans receivable balance. In 2025, we expanded Dealer access to the Purchase Program for Consumer Loans to consumers with higher credit ratings. The increase in the percentage of Purchased Loans in 2025 Consumer Loan assignment volume was primarily related to Consumer Loans assigned under this expanded Dealer access.
Current wording
As of September 30, 2025 and December 31, 2024, the net Dealer Loans receivable balance was 72.1% and 72.3%, respectively, of the total net Loans receivable balance. In 2025, we expanded Dealer access to the Purchase Program for Consumer Loans to consumers with higher credit ratings. The higher percentage of Purchased Loans in 2025 Consumer Loan assignment volume was primarily related to Consumer Loans assigned under this expanded Dealer access.
Previous wording
Finance Charges. The increase of $100.5 million, or 10.4%, was primarily a result of an increase in the average net Loans receivable balance, as follows:
Current wording
Finance Charges. The increase of $31.8 million, or 6.3%, was the result of increases in the average net Loans receivable balance and the average yield on our Loan portfolio as follows:
Previous wording
Operating Expenses. The increase of $31.1 million, or 25.0%, was primarily due to:
Current wording
Operating Expenses. The increase of $17.2 million, or 13.3%, was primarily due to:
Previous wording
•An increase in salaries and wages expense of $7.9 million, or 10.4%, primarily due to increases in (i) the number of team members as we are investing in our business with the goal of increasing the speed at which we enhance our product for Dealers and consumers and (ii) stock-based compensation expense, primarily due to equity awards granted to our executive officers and senior leaders.
Current wording
•An increase in salaries and wages expense of $8.2 million, or 10.6%, primarily due to increases in (i) the number of team members as we are investing in our business with the goal of increasing the speed at which we enhance our product for Dealers and consumers and (ii) fringe benefits, primarily due to higher medical claims.
Previous wording
Provision for Credit Losses. The decrease of $148.0 million, or 46.2%, was due to decreases in provision for credit losses on forecast changes and provision for credit losses on new Consumer Loan assignments.
Current wording
Provision for Credit Losses. The decrease of $32.7 million, or 17.7%, was due to decreases in provision for credit losses on forecast changes and provision for credit losses on new Consumer Loan assignments.
Previous wording
The decrease in provision for credit losses related to forecast changes was due to a smaller decline in Consumer Loan performance during the second quarter of 2025 compared to the second quarter of 2024. During the second quarter of 2025, we decreased our estimate of future net cash flows by $55.8 million, or 0.5%, to reflect a decline in forecasted collection rates during the period and slowed our forecasted net cash flow timing to reflect lower-than-expected Consumer Loan prepayments, which remained below historical averages. Historically, Consumer Loan prepayments have been lower in periods with less availability of consumer credit. The $55.8 million decrease in forecasted net cash flows for the second quarter of 2025 was composed of an ordinary decrease in forecasted net cash flows of $37.2 million, or 0.3%, and an adjustment applied to our forecasting methodology, which upon implementation, reduced forecasted net cash flows by $18.6 million, or 0.2%, and increased our provision for credit losses by $16.5 million. Consumer Loans assigned in 2024 prior to the implementation of our scorecard adjustment during the third quarter of 2024 had underperformed relative to the forecast adjustment we implemented during the second quarter of 2024. Accordingly, in the second quarter of 2025, we applied an adjustment to that segment of the Consumer Loans assigned in 2024 to reduce forecasted collection rates to what we believed the ultimate collection rates would be based on these trends.
Current wording
The decrease in provision for credit losses related to forecast changes in the third quarter of 2025 compared to the third quarter of 2024 reflected changes in forecasted net cash flow timing and a smaller decline in Consumer Loan performance. While we continued to experience slowing of forecasted net cash flow timing as a result of lower-than-expected Consumer Loan prepayments, it was to a lesser extent as compared to the same period in 2024. During the third quarter of 2025, we decreased our estimate of future net cash flows by $58.6 million, or 0.5%, to reflect a decline in forecasted collection rates during the period and slowed our forecasted net cash flow timing to reflect lower-than-expected Consumer Loan prepayments, which remained below historical averages. Historically, Consumer Loan prepayments have been lower in periods with less availability of consumer credit. During the third quarter of 2024, we decreased our estimate of future net cash flows by $62.8 million, or 0.6%, to reflect a decline in forecasted collection rates during the period and slowed our forecasted net cash flow timing to reflect a decrease in Consumer Loan prepayments, which remained below historical averages.
Previous wording
The 13.9% decrease in provision for credit losses related to new Consumer Loan assignments was primarily due to a 14.6% decrease in Consumer Loan assignment unit volume.
Current wording
The 18.9% decrease in provision for credit losses related to new Consumer Loan assignments was primarily due to a 16.5% decrease in Consumer Loan assignment unit volume.
Previous wording
Interest. The increase in interest expense of $13.6 million, or 13.0%, was primarily due to an increase in our average outstanding debt balance, primarily due to borrowings used to fund the growth of our Loan portfolio and stock repurchases.
Current wording
Interest. The increase in interest expense of $5.1 million, or 4.6%, was primarily due to an increase in our average outstanding debt balance.
Previous wording
Provision for Income Taxes. For the three months ended June 30, 2025, the effective income tax rate increased to 25.8% from 14.8% for the same period in 2024. The increase was primarily due to changes in state tax laws enacted during the second quarter of 2024 that were effective retroactively to the beginning of 2024, which increased our state income taxes and reduced, rather than increased, our effective income tax rate, as we had a pre-tax loss that quarter compared to pre-tax income for the second quarter of 2025. For additional information, see Note 10 to the consolidated financial statements contained in Part I - Item 1 of this Quarterly Report on Form 10-Q, which is incorporated herein by reference.
Current wording
Provision for Income Taxes. For the three months ended September 30, 2025, the effective income tax rate increased to 27.3% from 26.0% for the same period in 2024, primarily due to a revision of deferred tax estimates during the third quarter of 2025. For additional information, see Note 10 to the consolidated financial statements contained in Part I - Item 1 of this Quarterly Report on Form 10-Q, which is incorporated herein by reference.
Previous wording
Finance Charges. The increase of $43.0 million, or 8.6%, was primarily due to an increase in the average net Loans receivable balance, as follows:
Current wording
Finance Charges. The increase of $132.3 million, or 9.0%, was the result of increases in the average net Loans receivable balance and the average yield on our Loan portfolio as follows:
Previous wording
The following table summarizes the impact each component had on the overall increase in finance charges for the six months ended June 30, 2025:
Current wording
The following table summarizes the impact each component had on the overall increase in finance charges for the nine months ended September 30, 2025:
Previous wording
Operating Expenses. The increase of $40.5 million, or 16.2%, was primarily due to:
Current wording
Operating Expenses. The increase of $57.7 million, or 15.2%, was primarily due to:
Previous wording
•An increase in salaries and wages expense of $18.0 million, or 11.7%, primarily due to increases in (i) the number of team members as we are investing in our business with the goal of increasing the speed at which we enhance our product for Dealers and consumers, (ii) stock-based compensation expense, primarily due to equity awards granted to our executive officers and senior leaders, and (iii) fringe benefits, primarily due to higher medical claims.
Current wording
•An increase in salaries and wages expense of $26.2 million, or 11.3%, primarily due to increases in (i) the number of team members as we are investing in our business with the goal of increasing the speed at which we enhance our product for Dealers and consumers, (ii) stock-based compensation expense, primarily due to equity awards granted to our executive officers and senior leaders, and (iii) fringe benefits, primarily due to higher medical claims.
Previous wording
Provision for Credit Losses. The decrease of $172.1 million, or 34.0%, was due to a decreases in provision for credit losses on forecast changes and provision for credit losses on new Consumer Loan assignments.
Current wording
Provision for Credit Losses. The decrease of $204.8 million, or 29.6%, was due to decreases in provision for credit losses on forecast changes and provision for credit losses on new Consumer Loan assignments.
Previous wording
The decrease in provision for credit losses related to forecast changes was primarily due to a smaller decline in Consumer Loan performance during the first six months of 2025 compared to the firstsix months of 2024.
Current wording
The decrease in provision for credit losses related to forecast changes was primarily due to a smaller decline in Consumer Loan performance during the first nine months of 2025 compared to the first nine months of 2024.
Showing the first 40 of 48 pairs. Open the source sections for the rest.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
The 15.2% decrease in provision for credit losses related to new Consumer Loan assignments was primarily due to a 13.5% decrease in Consumer Loan assignment unit volume.
Rearranged previous paragraphs (3)
Previous report — wording carried elsewhere
during the most recent quarter. The following table provides averages for each of these segments:
Previous report — wording carried elsewhere
Loss on Sale of Building. For the six months ended June 30, 2024, we recognized a loss on sale of a building of $23.7 million.
Previous report — wording carried elsewhere
For additional information, see Note 10 to the consolidated financial statements contained in Part I - Item 1 of this Quarterly Report on Form 10-Q, which is incorporated herein by reference.