UPBOUND GROUP, INC.

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litigation or administrative proceedings to which we are or may be a party to from time to time and changes in estimates relating to litigation reserves, including in each case in connection with the regulatory and litigation matters described in Note 11 to our condensed consolidated financial statements included in this Quarterly Report on Form 10-Q;

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litigation or administrative proceedings to which we are or may be a party from time to time and changes in estimates relating to litigation reserves, including in each case in connection with the regulatory and litigation matters described in Note 12 to our condensed consolidated financial statements included in this Quarterly Report on Form 10-Q;

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At Brigit, continue to grow Brigit’s earned wages access, credit builder and other existing products and increase Brigit’s portfolio of products;

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At Brigit, continue to grow Brigit’s earned wage access, credit builder and other existing products and increase Brigit’s portfolio of products;

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Rent-A-Center e-commerce revenue. In recent years, e-commerce revenues have increased over time as a percentage of total rentals and fees revenue in our Rent-A-Center segment. For the six months ended June 30, 2026 and 2025, e-commerce revenues represented approximately 28% and 27% of total lease-to-own revenues, respectively. Due to recent trends in consumer shopping behaviors and expectations, we believe e-commerce solutions are an important part of our lease-to-own offering. However, we are unable to quantify the extent to which e-commerce revenues are incremental compared to what our overall revenues would have been in the absence of those e-commerce transactions. In addition, the profitability of e-commerce transactions can be impacted by different merchandise loss factors compared to traditional store-based transactions in the Rent-A-Center segment. Therefore, we are unable to determine with certainty whether the continuation of this trend toward increased e-commerce transactions will have a significant impact on our financial statements in future periods or be ultimately favorable or unfavorable to our financial results.

Current wording

Rent-A-Center e-commerce revenue. In recent years, e-commerce revenues have increased over time as a percentage of total rentals and fees revenue in our Rent-A-Center segment. For the nine months ended September 30, 2026 and 2025, e-commerce revenues represented approximately 28% and 27% of total lease-to-own revenues, respectively. Due to recent trends in consumer shopping behaviors and expectations, we believe e-commerce solutions are an important part of our lease-to-own offering. However, we are unable to quantify the extent to which e-commerce revenues are incremental compared to what our overall revenues would have been in the absence of those e-commerce transactions. In addition, the profitability of e-commerce transactions can be impacted by different merchandise loss factors compared to traditional store-based transactions in the Rent-A-Center segment. Therefore, we are unable to determine with certainty whether the continuation of this trend toward increased e-commerce transactions will have a significant impact on our financial statements in future periods or be ultimately favorable or unfavorable to our financial results.

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The following discussion focuses on our results of operations and our liquidity and capital resources. You should read this discussion in conjunction with the condensed consolidated financial statements and notes thereto for the six months ended June 30, 2026 included in Part I, Item 1 of this Quarterly Report on Form 10-Q.

Current wording

The following discussion focuses on our results of operations and our liquidity and capital resources. You should read this discussion in conjunction with the condensed consolidated financial statements and notes thereto for the nine months ended September 30, 2026 included in Part I, Item 1 of this Quarterly Report on Form 10-Q.

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Lease Charge-Offs (“LCOs”) (previously referred to as “skip / stolen losses”): Represents charge-offs of the net book value of unrecoverable on-rent merchandise with lease-to-own customers who are past due. This is typically expressed as a percentage of revenues for the applicable period. For the Rent-A-Center segment, LCOs exclude Get It Now, Home Choice and franchise-owned Rent-A-Center locations. For the Acima segment, LCOs exclude fraudulent lease-to-own contract losses.

Current wording

Lease Charge-Offs (“LCOs”): Represents charge-offs of the net book value of unrecoverable on-rent merchandise with lease-to-own customers who are past due. This is typically expressed as a percentage of revenues for the applicable period. For the Rent-A-Center segment, LCOs exclude Get It Now, Home Choice and franchise-owned Rent-A-Center locations. For the Acima segment, LCOs exclude fraudulent lease-to-own contract losses.

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We report four operating segments: Acima, Rent-A-Center, Brigit and Mexico. The following briefly summarizes our financial performance for the six months ended June 30, 2026 as compared to the six months ended June 30, 2025 on a consolidated basis and for our operating segments.

Current wording

We report four operating segments: Acima, Rent-A-Center, Brigit and Mexico. The following briefly summarizes our financial performance for the nine months ended September 30, 2026 as compared to the nine months ended September 30, 2025 on a consolidated basis and for our operating segments.

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During the first six months ended June 30, 2026, consolidated revenues and gross profit increased by approximately $49.3 million and $59.3 million, respectively, primarily due to an increase in Brigit segment revenues, partially offset by decreases in Rent-A-Center and Acima segment revenues described below. Operating profit increased by approximately $18.4 million, primarily due to the increase in gross profit noted above and decreases in general and administrative expenses and other gains and charges of $10.4 million and $15.9 million, respectively, partially offset by increases in non-labor operating expenses of $61.3 million.

Current wording

During the nine months ended September 30, 2026, consolidated revenues and gross profit increased by approximately $30.7 million and $76.5 million, respectively, primarily due to an increase in Brigit segment revenues, partially offset by decreases in Rent-A-Center and Acima segment revenues described below. Operating profit increased by approximately $36.8 million, partly due to the increase in gross profit noted above and a decrease in other gains and charges of $36.8 million, partially offset by increases in non-labor operating expenses of $73.4 million.

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Acima segment revenues decreased approximately $4.1 million for the six months ended June 30, 2026, primarily due to lower merchandise sales revenues of $7.3 million, partially offset by fewer customers electing early purchase options in 2026 resulting in higher rentals and fees revenues of $3.5 million. Operating profit decreased approximately $5.0 million for the six months ended June 30, 2026, primarily due to increases in other gains and charges and non-labor operating expenses of $13.3 million and $3.4 million, respectively, partially offset by an increase in gross profit of $10.8 million. See“Segment Performance” below for further discussion of Acima segment operating results for the six months ended June 30, 2026.

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Acima segment revenues decreased approximately $44.6 million for the nine months ended September 30, 2026, primarily due to lower rentals and fees revenues and merchandise sales revenues of $23.6 million and $20.7 million, respectively, primarily due to a decrease in GMV. Operating profit increased approximately $6.0 million for the nine months ended September 30, 2026, primarily due to an increase in gross profit of $10.9 million and decreases in non-labor operating expenses and operating labor of $6.2 million and $2.6 million, respectively, partially offset by an increase in other gains and charges of $13.4 million. See“Segment Performance” below for further discussion of Acima segment operating results for the nine months ended September 30, 2026.

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Revenues in our Rent-A-Center segment decreased approximately $8.2 million for the six months ended June 30, 2026, primarily due to decreases in merchandise sales and other revenues of $8.4 million and $6.8 million, respectively, primarily resulting from fewer customers electing early purchase options and lower franchise revenues, partially offset by an increase in rentals and fees revenues of $7.0 million. Operating profit decreased approximately $12.5 million for the six months ended June 30, 2026, primarily due to a decrease in gross profit of approximately $5.7 million driven by lower revenues, in addition to higher non-labor operating expenses and operating labor expenses of approximately $14.4 million and $1.0 million, respectively, partially offset by a decrease in general and administrative expenses of approximately $11.1 million. See“Segment Performance” below for further discussion of Rent-A-Center segment operating results for the six months ended June 30, 2026.

Current wording

Revenues in our Rent-A-Center segment decreased approximately $10.3 million for the nine months ended September 30, 2026, primarily due to decreases in merchandise sales and other revenues of $13.2 million and $9.1 million, respectively, primarily resulting from fewer customers electing early purchase options and lower franchise revenues, partially offset by an increase in rentals and fees revenues of $12.0 million. Operating profit decreased approximately $13.3 million for the nine months ended September 30, 2026, primarily due to a decrease in gross profit of approximately $10.5 million driven by lower revenues, in addition to higher non-labor operating expenses of approximately $20.9 million, partially offset by decreases in general and administrative expenses and operating labor expenses of approximately $10.6 million and $2.4 million, respectively. See“Segment Performance” below for further discussion of Rent-A-Center segment operating results for the nine months ended September 30, 2026.

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The Brigit segment revenues and gross profit increased by $55.0 million and $50.2 million, respectively, for the six months ended June 30, 2026, partially due to only five months being included in operating results for the six months ended June 30, 2025 following the Closing Date, in addition to an increase in Brigit subscription customers during the six months ended June 30, 2026. See“Segment Performance” below for further discussion of Brigit segment operating results for the six months ended June 30, 2026.

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The Brigit segment revenues and gross profit increased by $76.2 million and $70.1 million, respectively, for the nine months ended September 30, 2026, partially due to only eight months being included in operating results for the nine months ended September 30, 2025 following the Closing Date, in addition to an increase in Brigit subscription customers during the nine months ended September 30, 2026. See“Segment Performance” below for further discussion of Brigit segment operating results for the nine months ended September 30, 2026.

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The Mexico segment revenues and gross profit increased by 16.9% and 14.7% for the six months ended June 30, 2026, respectively, primarily due to positive impacts of exchange rate fluctuations. See“Segment Performance” below for further discussion of Mexico segment operating results for the six months ended June 30, 2026.

Current wording

The Mexico segment revenues and gross profit increased by 15.9% and 14.4% for the nine months ended September 30, 2026, respectively, primarily due to positive impacts of exchange rate fluctuations. See“Segment Performance” below for further discussion of Mexico segment operating results for the nine months ended September 30, 2026.

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Cash flow from operations was $294.0 million for the six months ended June 30, 2026. As of June 30, 2026, we held $105.3 million of cash and cash equivalents and had outstanding indebtedness of $1.4 billion.

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Cash flow from operations was $457.1 million for the nine months ended September 30, 2026. As of September 30, 2026, we held $125.1 million of cash and cash equivalents and had outstanding indebtedness of $1.4 billion.

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Revenue. Total revenues increased by $5.9 million, or 0.5%, to $1,163.4 million for the three months ended June 30, 2026, from $1,157.5 million for the three months ended June 30, 2025. This increase was primarily due to increases of approximately $19.2 million and $2.9 million in the Brigit and Mexico segments, respectively, partially offset by decreases of approximately $15.4 million and $0.7 million in the Acima and Rent-A-Center segments, respectively, as discussed further in the “Segment Performance” section below.

Current wording

Revenue. Total revenues decreased by $18.5 million, or 1.6%, to $1,146.2 million for the three months ended September 30, 2026, from $1,164.7 million for the three months ended September 30, 2025. This decrease was primarily due to decreases of approximately $40.5 million and $2.1 million in the Acima and Rent-A-Center segments, respectively, partially offset by increases of approximately $21.1 million and $2.9 million in the Brigit and Mexico segments, respectively, as discussed further in the “Segment Performance” section below.

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Cost of Rentals and Fees. Cost of rentals and fees consists primarily of depreciation of rental merchandise. Cost of rentals and fees for the three months ended June 30, 2026 decreased by $7.5 million, or 2.1%, to $350.6 million as compared to $358.1 million for the three months ended June 30, 2025. The decrease was primarily attributable to decreases of approximately $6.4 million and $2.0 million in the Acima and Rent-A-Center segments, respectively, driven by decreases in rentals and fees revenues. Cost of rentals and fees expressed as a percentage of rentals and fees revenue decreased to 38.8% for the three months ended June 30, 2026, as compared to 39.6% for the three months ended June 30, 2025.

Current wording

Cost of Rentals and Fees. Cost of rentals and fees consists primarily of depreciation of rental merchandise. Cost of rentals and fees for the three months ended September 30, 2026 decreased by $18.9 million, or 5.2%, to $345.2 million as compared to $364.1 million for the three months ended September 30, 2025. The decrease was primarily attributable to a decrease of approximately $19.5 million in the Acima segment driven by decreases in rentals and fees revenues and merchandise sales revenues. Cost of rentals and fees expressed as a percentage of rentals and fees revenue decreased to 39.2% for the three months ended September 30, 2026, as compared to 40.4% for the three months ended September 30, 2025.

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Cost of Merchandise Sold. Cost of merchandise sold represents the net book value of rental merchandise at time of sale. Cost of merchandise sold decreased by $10.7 million, or 4.8%, to $210.9 million for the three months ended June 30, 2026, from $221.7 million for the three months ended June 30, 2025, primarily attributable to a decrease of $12.2 million in the Acima segment, driven by lower merchandise sales, partially offset by an increase of approximately $1.3 million in the Rent-A-Center segment. The gross margin percent of merchandise sales decreased to (15.4)% for the three months ended June 30, 2026, from (15.3)% for the three months ended June 30, 2025.

Current wording

Cost of Merchandise Sold. Cost of merchandise sold represents the net book value of rental merchandise at time of sale. Cost of merchandise sold decreased by $18.1 million, or 7.8%, to $212.8 million for the three months ended September 30, 2026, from $230.9 million for the three months ended September 30, 2025, primarily attributable to a decrease of $21.2 million in the Acima segment, driven by lower revenues, partially offset by an increase of approximately $2.9 million in the Rent-A-Center segment. The gross margin percent of merchandise sales decreased to (18.1)% for the three months ended September 30, 2026, from (16.5)% for the three months ended September 30, 2025.

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Gross Profit. Gross profit increased by $23.0 million, or 4.0%, to $594.8 million for the three months ended June 30, 2026, from $571.8 million for the three months ended June 30, 2025, primarily due to increases of $18.2 million, $3.1 million and $1.7 million in the Brigit, Acima and Mexico segments, respectively, as discussed further in the section “Segment Performance” below. Gross profit as a percentage of total revenue increased to 51.1% for the three months ended June 30, 2026, from 49.4% for the three months ended June 30, 2025, primarily due to mix-shift changes between subscriptions and fees product categories in the Brigit segment and fewer customers exercising early purchase options in the Acima segment.

Current wording

Gross Profit. Gross profit increased by $17.1 million, or 3.0%, to $580.2 million for the three months ended September 30, 2026, from $563.1 million for the three months ended September 30, 2025, primarily due to increases of $19.9 million and $2.1 million in the Brigit and Mexico segments, respectively, partially offset by a decrease of $4.9 million in the Rent-A-Center segment, as discussed further in the section “Segment Performance” below. Gross profit as a percentage of total revenue increased to 50.6% for the three months ended September 30, 2026, from 48.3% for the three months ended September 30, 2025, primarily due to mix-shift changes between subscriptions and fees product categories in the Brigit segment and fewer customers exercising early purchase options in the Acima segment.

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Operating Labor. Operating labor includes all salaries and wages paid to operational employees and district managers, together with payroll taxes and benefits. Operating labor increased by $3.2 million or 2.2% to $152.3 million for the three months ended June 30, 2026, as compared to $149.1 million for the three months ended June 30, 2025. Operating labor expressed as a percentage of total revenue was 13.1% for the three months ended June 30, 2026, as compared to 12.9% for the three months ended June 30, 2025.

Current wording

Operating Labor. Operating labor includes all salaries and wages paid to operational employees and district managers, together with payroll taxes and benefits. Operating labor decreased by $4.3 million or 2.8% to $147.4 million for the three months ended September 30, 2026, as compared to $151.7 million for the three months ended September 30, 2025. Operating labor expressed as a percentage of total revenue was 12.9% for the three months ended September 30, 2026, as compared to 13.0% for the three months ended September 30, 2025.

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Non-Labor Operating Expenses. Non-labor operating expenses include LCOs, occupancy, delivery, advertising, selling, insurance, travel and other operating expenses. Non-labor operating expenses increased by $30.2 million, or 13.1%, to $260.3 million for the three months ended June 30, 2026, as compared to $230.1 million for the three months ended June 30, 2025, primarily due to increases of $20.5 million, $8.9 million and $1.7 million in the Brigit, Rent-A-Center and Mexico segments, respectively, partially offset by a decrease of $1.1 million in the Acima segment. The increase in the Brigit segment was primarily due to higher advertising expenses and customer advance losses of $9.1 million and $7.6 million, respectively, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025. Non-labor operating expenses expressed as a percentage of total revenue was 22.4% for the three months ended June 30, 2026, compared to 19.9% for the three months ended June 30, 2025.

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Non-Labor Operating Expenses. Non-labor operating expenses include LCOs, occupancy, delivery, advertising, selling, insurance, travel and other operating expenses. Non-labor operating expenses increased by $11.9 million, or 4.9%, to $254.0 million for the three months ended September 30, 2026, as compared to $242.1 million for the three months ended September 30, 2025, primarily due to increases of $14.1 million, $6.5 million and $1.0 million in the Brigit, Rent-A-Center and Mexico segments, respectively, partially offset by a decrease of $9.6 million in the Acima segment. The increase in the Brigit segment was primarily due to higher customer advance losses and advertising expenses of $7.7 million and $4.1 million, respectively, for the three months ended September 30, 2026, compared to the three months ended September 30, 2025. Non-labor operating expenses expressed as a percentage of total revenue was 22.2% for the three months ended September 30, 2026, compared to 20.8% for the three months ended September 30, 2025.

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General and Administrative Expenses. General and administrative expenses include all corporate overhead expenses related to our headquarters such as salaries, payroll taxes and benefits, stock-based compensation, occupancy, administrative and other expenses, as well as salaries and labor costs for our regional directors, divisional vice presidents and executive vice presidents. General and administrative expenses decreased by $3.7 million, or (5.9)%, to $59.7 million for the three months ended June 30, 2026, as compared to $63.4 million for the three months ended June 30, 2025, primarily due to a decrease of approximately $6 million in the Rent-A-Center segment, partially offset by increases of $1.0 million in the Mexico segment and $1.5 million in Corporate costs. General and administrative expenses expressed as a percentage of total revenue was 5.1% for the three months ended June 30, 2026, compared to 5.5% for the three months ended June 30, 2025.

Current wording

General and Administrative Expenses. General and administrative expenses include all corporate overhead expenses related to our headquarters such as salaries, payroll taxes and benefits, stock-based compensation, occupancy, administrative and other expenses, as well as salaries and labor costs for our regional directors, divisional vice presidents and executive vice presidents. General and administrative expenses increased by $10.7 million, or 21.2%, to $60.9 million for the three months ended September 30, 2026, as compared to $50.2 million for the three months ended September 30, 2025, primarily due to an increase of $9.5 million in Corporate costs driven by higher compensation and outside service costs. General and administrative expenses expressed as a percentage of total revenue was 5.3% for the three months ended September 30, 2026, compared to 4.3% for the three months ended September 30, 2025.

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Other Gains and Charges. Other gains and charges decreased by $11.1 million to $54.4 million for the three months ended June 30, 2026, as compared to $65.5 million for the three months ended June 30, 2025. The decrease in other gains and charges was driven primarily by a decrease of $33.6 million in estimated legal accruals and related litigation and defense expenses as described in Note 11 of our condensed consolidated financial statements included in this Quarterly Report on Form 10-Q, partially offset by an increase of $13.3 million related to Acima fraudulent lease-to-own contract losses as discussed above, $5.3 million related to stock compensation expense associated with the vesting of a portion of the Brigit acquisition equity consideration, and $4.0 million related to store consolidations during the three months ended June 30, 2026.

Current wording

Other Gains and Charges. Other gains and charges decreased by $20.9 million to $32.5 million for the three months ended September 30, 2026, as compared to $53.4 million for the three months ended September 30, 2025. The decrease in other gains and charges was driven primarily by decreases of $12.7 million in estimated legal accruals and related litigation and defense expenses as described in Note 12 of our condensed consolidated financial statements included in this Quarterly Report on Form 10-Q, $11.6 million in asset impairment related to the closure of approximately 50 franchise store locations in the third quarter of 2025 and $5.1 million related to stock compensation expense associated with the vesting of the Brigit acquisition equity consideration, partially offset by an increase of $6.0 million related to store consolidations during the three months ended September 30, 2026.

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Operating Profit. Operating profit increased by $3.6 million, or 6.9%, to $54.3 million for the three months ended June 30, 2026, as compared to $50.7 million for the three months ended June 30, 2025, primarily due to increases in revenues and gross profit, in addition to decreases in general and administrative expenses and other gains and charges, partially offset by an increase in non-labor operating expenses, as described above. Operating profit expressed as a percentage of total revenue was 4.7% for the three months ended June 30, 2026, compared to 4.4% for the three months ended June 30, 2025.

Current wording

Operating Profit. Operating profit increased by $18.4 million, or 34.9%, to $71.2 million for the three months ended September 30, 2026, as compared to $52.8 million for the three months ended September 30, 2025, primarily due to an increase in gross profit, in addition to decreases in other gains and charges and operating labor, partially offset by increases in non-labor operating expenses and general and administrative expenses as described above. Operating profit expressed as a percentage of total revenue was 6.2% for the three months ended September 30, 2026, compared to 4.5% for the three months ended September 30, 2025.

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Income Tax Expense. Income tax expense increased by $0.3 million to $7.7 million for the three months ended June 30, 2026, as compared to $7.4 million for the three months ended June 30, 2025, primarily due to the increase in earnings before income taxes partially offset by a lower effective tax rate for the three months ended June 30, 2026 compared to the three months ended June 30, 2025.

Current wording

Income Tax Expense. Income tax expense increased by $5.9 million to $12.5 million for the three months ended September 30, 2026, as compared to $6.6 million for the three months ended September 30, 2025, primarily due to the increase in earnings before income taxes partially offset by a lower effective tax rate for the three months ended September 30, 2026 compared to the three months ended September 30, 2025.

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Revenue. Total revenues increased by $49.3 million, or 2.1%, to $2,383.2 million for the six months ended June 30, 2026, from $2,333.9 million for the six months ended June 30, 2025. This increase was primarily due to increases of approximately $55.0 million and $6.3 million in the Brigit and Mexico segments, respectively, partially offset by decreases of approximately $8.2 million and $4.1 million in the Rent-A-Center and Acima segments, respectively, as discussed further in the “Segment Performance” section below.

Current wording

Revenue. Total revenues increased by $30.7 million, or 0.9%, to $3,529.3 million for the nine months ended September 30, 2026, from $3,498.6 million for the nine months ended September 30, 2025. This increase was primarily due to increases of approximately $76.2 million and $9.3 million in the Brigit and Mexico segments, respectively, partially offset by decreases of approximately $44.6 million and $10.3 million in the Acima and Rent-A-Center segments, respectively, as discussed further in the “Segment Performance” section below.

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Cost of Rentals and Fees. Cost of rentals and fees consists primarily of depreciation of rental merchandise. Cost of rentals and fees for the six months ended June 30, 2026 decreased by $2.4 million, or 0.3%, to $708.2 million as compared to $710.6 million for the six months ended June 30, 2025. The decrease was primarily attributable to a decrease of approximately $6.3 million in the Rent-A-Center segment, partially offset by increases of approximately $2.0 million and $1.9 million in the Acima and Mexico segments, respectively, driven by an increase in rentals and fees revenue. Cost of rentals and fees expressed as a percentage of rentals and fees revenue decreased to 38.9% for the six months ended June 30, 2026, as compared to 39.4% for the six months ended June 30, 2025.

Current wording

Cost of Rentals and Fees. Cost of rentals and fees consists primarily of depreciation of rental merchandise. Cost of rentals and fees for the nine months ended September 30, 2026 decreased by $21.4 million, or 2.0%, to $1,053.4 million as compared to $1,074.8 million for the nine months ended September 30, 2025. The decrease was primarily attributable to decreases of approximately $17.4 million and $6.4 million in the Acima and Rent-A-Center segments, respectively, partially offset by an increase of approximately $2.5 million in the Mexico segment, driven by an increase in rentals and fees revenue. Cost of rentals and fees expressed as a percentage of rentals and fees revenue decreased to 39.0% for the nine months ended September 30, 2026, as compared to 39.7% for the nine months ended September 30, 2025.

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Cost of Merchandise Sold. Cost of merchandise sold represents the net book value of rental merchandise at time of sale. Cost of merchandise sold decreased by $12.5 million, or 2.5%, to $478.8 million for the six months ended June 30, 2026, from $491.3 million for the six months ended June 30, 2025, primarily attributable to a decrease of $16.9 million in the Acima segment, driven by lower merchandise sales, partially offset by an increase of approximately $3.8 million in the Rent-A-Center segment. The gross margin percent of merchandise sales decreased to (15.9)% for the six months ended June 30, 2026, from (14.7)% for the six months ended June 30, 2025, primarily resulting from lower early purchase option exercises in the Rent-A-Center segment for the six months ended June 30, 2026.

Current wording

Cost of Merchandise Sold. Cost of merchandise sold represents the net book value of rental merchandise at time of sale. Cost of merchandise sold decreased by $30.5 million, or 4.2%, to $691.7 million for the nine months ended September 30, 2026, from $722.2 million for the nine months ended September 30, 2025, primarily attributable to a decrease of $38.0 million in the Acima segment, driven by lower merchandise sales, partially offset by an increase of approximately $6.7 million in the Rent-A-Center segment. The gross margin percent of merchandise sales decreased to (16.6)% for the nine months ended September 30, 2026, from (15.3)% for the nine months ended September 30, 2025.

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Gross Profit. Gross profit increased by $59.3 million, or 5.3%, to $1,181.3 million for the six months ended June 30, 2026, from $1,122.0 million for the six months ended June 30, 2025, primarily due to increases of $50.2 million, $10.8 million and $3.9 million in the Brigit, Acima and Mexico segments, respectively, partially offset by a decrease of $5.7 million in the Rent-A-Center segment, as discussed further in the section “Segment Performance” below. Gross profit as a percentage of total revenue increased to 49.6% for the six months ended June 30, 2026, from 48.1% for both the six months ended June 30, 2025.

Current wording

Gross Profit. Gross profit increased by $76.5 million, or 4.5%, to $1,761.5 million for the nine months ended September 30, 2026, from $1,685.0 million for the nine months ended September 30, 2025, primarily due to increases of $70.1 million, $10.9 million and $6.0 million in the Brigit, Acima and Mexico segments, respectively, partially offset by a decrease of $10.5 million in the Rent-A-Center segment, as discussed further in the section “Segment Performance” below. Gross profit as a percentage of total revenue increased to 49.9% for the nine months ended September 30, 2026, from 48.2% for the nine months ended September 30, 2025.

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Operating Labor. Operating labor includes all salaries and wages paid to operational employees and district managers, together with payroll taxes and benefits. Operating labor increased by $3.1 million to $301.4 million for the six months ended June 30, 2026, as compared to $298.3 million for the six months ended June 30, 2025. Operating labor expressed as a percentage of total revenue was 12.6% for the six months ended June 30, 2026, as compared to 12.8% for the six months ended June 30, 2025.

Current wording

Operating Labor. Operating labor includes all salaries and wages paid to operational employees and district managers, together with payroll taxes and benefits. Operating labor decreased by $1.2 million to $448.8 million for the nine months ended September 30, 2026, as compared to $450.0 million for the nine months ended September 30, 2025. Operating labor expressed as a percentage of total revenue was 12.7% for the nine months ended September 30, 2026, as compared to 12.9% for the nine months ended September 30, 2025.

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Non-Labor Operating Expenses. Non-labor operating expenses include LCOs, occupancy, delivery, advertising, selling, insurance, travel and other operating expenses. Non-labor operating expenses increased by $61.3 million, or 13.7%, to $510.5 million for the six months ended June 30, 2026, as compared to $449.2 million for the six months ended June 30, 2025, due to increases of $40.1 million, $14.4 million, $3.5 million and $3.4 million in the Brigit, Rent-A-Center, Mexico and Acima segments, respectively. The increase in the Brigit segment was partially due to the six months ended June 30, 2025 including only five months of expenses after the Closing Date, in addition to higher advertising expenses and net advance losses of $18.5 million and $16.5 million, respectively. Non-labor operating expenses expressed as a percentage of total revenue was 21.4% for the six months ended June 30, 2026, compared to 19.2% for the six months ended June 30, 2025.

Current wording

Non-Labor Operating Expenses. Non-labor operating expenses include LCOs, occupancy, delivery, advertising, selling, insurance, travel and other operating expenses. Non-labor operating expenses increased by $73.4 million, or 10.6%, to $764.6 million for the nine months ended September 30, 2026, as compared to $691.2 million for the nine months ended September 30, 2025, due to increases of $54.2 million, $20.9 million and $4.5 million in the Brigit, Rent-A-Center, and Mexico segments, respectively, partially offset by a decrease of $6.2 million in the Acima segment. The increase in the Brigit segment was partially due to the nine months ended September 30, 2025 including only eight months of expenses after the Closing Date, in addition to higher net advance losses and advertising expenses of $24.2 million and $22.6 million, respectively. Non-labor operating expenses expressed as a percentage of total revenue was 21.7% for the nine months ended September 30, 2026, compared to 19.8% for the nine months ended September 30, 2025.

Previous wording

General and Administrative Expenses. General and administrative expenses include all corporate overhead expenses related to our headquarters such as salaries, payroll taxes and benefits, stock-based compensation, occupancy, administrative and other expenses, as well as salaries and labor costs for our regional directors, divisional vice presidents and executive vice presidents. General and administrative expenses decreased by $10.4 million, or (8.2)%, to $116.8 million for the six months ended June 30, 2026, as compared to $127.2 million for the six months ended June 30, 2025, primarily due to a decrease in bad debt expense of $8.1 million related to franchising trade receivables. General and administrative expenses expressed as a percentage of total revenue was 4.9% for the six months ended June 30, 2026, compared to 5.4% for the six months ended June 30, 2025.

Current wording

General and Administrative Expenses. General and administrative expenses include all corporate overhead expenses related to our headquarters such as salaries, payroll taxes and benefits, stock-based compensation, occupancy, administrative and other expenses, as well as salaries and labor costs for our regional directors, divisional vice presidents and executive vice presidents. General and administrative expenses increased by $0.3 million, or 0.1%, to $177.7 million for the nine months ended September 30, 2026, as compared to $177.4 million for the nine months ended September 30, 2025. General and administrative expenses expressed as a percentage of total revenue was 5.0% for the nine months ended September 30, 2026, compared to 5.1% for the nine months ended September 30, 2025.

Previous wording

Other Gains and Charges. Other gains and charges decreased by $15.9 million or (14.6)% to $92.9 million for the six months ended June 30, 2026, as compared to $108.8 million for the six months ended June 30, 2025. The decrease in other gains and charges was driven primarily by a decrease of $40.2 million in estimated legal accruals and related litigation and defense expenses as described in Note 11 of our condensed consolidated financial statements included in this Quarterly Report on Form 10-Q, partially offset by an increase of $13.3 million related to Acima fraudulent lease-to-own contract losses as discussed above, $6.1 million related to stock compensation expense associated with the vesting of a portion of the Brigit acquisition equity consideration, and $4.0 million related to store consolidations in the first half of 2026.

Current wording

Other Gains and Charges. Other gains and charges decreased by $36.8 million or 22.7% to $125.3 million for the nine months ended September 30, 2026, as compared to $162.1 million for the nine months ended September 30, 2025. The decrease in other gains and charges was driven primarily by decreases of $52.9 million in estimated legal accruals and related litigation and defense expenses as described in Note 12 of our condensed consolidated financial statements included in this Quarterly Report on Form 10-Q and $10.3 million in asset impairment primarily related to the closure of approximately 50 franchise store locations in the third quarter of 2025, partially offset by increases of $13.3 million related to Acima fraudulent lease-to-own contract losses and $9.9 million related to store consolidations in the first half of 2026.

Previous wording

Operating Profit. Operating profit increased by $18.4 million, or 16.2%, to $131.7 million for the six months ended June 30, 2026, as compared to $113.3 million for the six months ended June 30, 2025, primarily due to increases in revenues and gross profit, in addition to decreases in general and administrative expenses and other gains and charges, partially offset by an increase in non-labor operating expenses, as described above. Operating profit expressed as a percentage of total revenue was 5.5% for the six months ended June 30, 2026, compared to 4.9% for the six months ended June 30, 2025.

Current wording

Operating Profit. Operating profit increased by $36.8 million, or 22.1%, to $202.9 million for the nine months ended September 30, 2026, as compared to $166.1 million for the nine months ended September 30, 2025, primarily due to increases in revenues and gross profit, in addition to a decrease in other gains and charges, partially offset by an increase in non-labor operating expenses, as described above. Operating profit expressed as a percentage of total revenue was 5.7% for the nine months ended September 30, 2026, compared to 4.7% for the nine months ended September 30, 2025.

Previous wording

Income Tax Expense. Income tax expense increased by $5.1 million to $23.2 million for the six months ended June 30, 2026, as compared to $18.1 million for the six months ended June 30, 2025, primarily due to the increase in earnings before income taxes for the six months ended June 30, 2026 compared to the six months ended June 30, 2025.

Current wording

Income Tax Expense. Income tax expense increased by $10.9 million to $35.6 million for the nine months ended September 30, 2026, as compared to $24.7 million for the nine months ended September 30, 2025, primarily due to the increase in earnings before income taxes partially offset by a lower effective tax rate for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025.

Previous wording

Revenues. The decrease in revenues for the three months ended June 30, 2026 as compared to the three months ended June 30, 2025 was primarily due to a decrease in rentals and fees revenues of $9.1 million and a decrease in merchandise sales revenue of $6.0 million, driven by lower GMV. In addition the decrease in revenues for the six months ended June 30, 2026, as compared to the six months ended June 30, 2025 was partially due to a decrease in merchandise sales revenue of $7.3 million, offset by an increase in rentals and fees revenues of $3.5 million.

Current wording

Revenues. The decrease in revenues for the three months ended September 30, 2026 as compared to the three months ended September 30, 2025 was primarily due to a decreases in rentals and fees and merchandise sales revenues of $27.1 million and $13.3 million, respectively, driven by lower GMV. In addition the decrease in revenues for the nine months ended September 30, 2026, as compared to the nine months ended September 30, 2025 was due to decreases in rentals and fees and merchandise sales revenues of $23.6 million and $20.7 million, respectively.

Previous wording

Gross Profit. Gross profit increased for the three and six months ended June 30, 2026 as compared to the three and six months ended June 30, 2025, primarily driven by fewer customers exercising early purchase options. Gross profit as a percentage of segment revenues increased to 32.8% and 31.3% for the three and six months ended June 30, 2026, respectively, compared to 31.5% and 30.4% for the three and six months ended June 30, 2025, respectively, primarily due to fewer customers exercising early purchase options.

Current wording

Gross Profit. Gross profit increased for the three and nine months ended September 30, 2026 as compared to the three and nine months ended September 30, 2025, primarily driven by fewer customers exercising early purchase options. Gross profit as a percentage of segment revenues increased to 31.4% and 31.3% for the three and nine months ended September 30, 2026, respectively, compared to 29.3% and 30.0% for the three and nine months ended September 30, 2025, respectively, primarily due to fewer customers exercising early purchase options.

Previous wording

Operating Profit. Operating profit as a percentage of segment revenues decreased to 12.2% and 12.0% for the three and six months ended June 30, 2026, respectively, compared to 13.2% and 12.4% for the three and six months ended June 30, 2025, respectively. The decrease in operating profit for the three and six months ended June 30, 2026 was primarily due to an increase in other charges of $13.3 million for both the three and six months ended June 30, 2026, related to Acima fraudulent lease-to-own contract losses as discussed above, partially offset by the increase in gross profit described above. Merchandise losses in our Acima locations due to LCOs, expressed as a percentage of segment revenues, were approximately 8.8% for both the three and six months ended June 30, 2026, compared to 9.3% and 9.1% for the three and six months ended June 30, 2025, respectively. Merchandise losses in our Acima locations due to other merchandise losses, expressed as a percentage of segment revenues, were approximately 0.5% for both the three and six months ended June 30, 2026 compared to 0.4% and 0.3% for the three and six months ended June 30, 2025, respectively.

Current wording

Operating Profit. Operating profit as a percentage of segment revenues increased to 12.8% and 12.3% for the three and nine months ended September 30, 2026, respectively, compared to 10.2% and 11.7% for the three and nine months ended September 30, 2025, respectively, primarily due to the increase in gross profit margin described above. Merchandise losses in our Acima locations due to LCOs, expressed as a percentage of segment revenues, were approximately 8.7% and 8.8% for the three and nine months ended September 30, 2026, respectively, compared to 9.7% and 9.3% for the three and nine months ended September 30, 2025, respectively. Merchandise losses in our Acima locations due to other merchandise losses, expressed as a percentage of segment revenues, were approximately 0.6% and 0.5% for the three and nine months ended September 30, 2026, respectively, compared to 0.4% for both the three and nine months ended September 30, 2025, respectively.

Previous wording

Revenues. The decrease in revenue for the three and six months ended June 30, 2026, as compared to the three and six months ended June 30, 2025, was primarily due to decreases in merchandise sales of $3.5 million and $8.4 million, respectively, primarily resulting from fewer customers electing early purchase options and lower franchise revenues, partially offset by increases in rentals and fees of $5.9 million and $7.0 million, respectively.

Current wording

Revenues. The decrease in revenue for the three and nine months ended September 30, 2026, as compared to the three and nine months ended September 30, 2025, was primarily due to decreases in merchandise sales of $4.7 million and $13.2 million, respectively, primarily resulting from fewer customers electing early purchase options and decreases in other revenue of $2.3 million and $9.1 million, respectively, due to lower franchise revenues, partially offset by increases in rentals and fees of $5.0 million and $12.0 million, respectively.

Previous wording

Gross Profit. Gross profit decreased for the three and six months ended June 30, 2026, as compared to the three and six months ended June 30, 2025, driven primarily by the decrease in revenues described above. Gross profit as a percentage of segment revenues was 67.9% and 66.9% for both the three and six months ended June 30, 2026 and three and six months ended June 30, 2025.

Current wording

Gross Profit. Gross profit decreased for the three and nine months ended September 30, 2026, as compared to the three and nine months ended September 30, 2025, driven primarily by the decrease in revenues described above. Gross profit as a percentage of segment revenues was 67.4% and 67.0% for the three and nine months ended September 30, 2026, respectively, and 68.1% and 67.3% for the three and nine months ended September 30, 2025, respectively.

Previous wording

Operating Profit. Operating profit as a percentage of segment revenues was 11.7% and 12.3% for the three and six months ended June 30, 2026, respectively, compared to 13.5% for both the three and six months ended June 30, 2025, respectively. The decrease in operating profit margin for the three and six months ended June 30, 2026, as compared to the three and six months ended June 30, 2025, was partially driven by the decrease in gross profit described above, in addition to increases in merchandise losses, advertising expenses, and insurance costs. Merchandise losses in our company-owned Rent-A-Center lease-to-own stores due to LCOs, expressed as a percentage of Rent-A-Center lease-to-own revenues, were approximately 5.0% and 4.8% for the three and six months ended June 30, 2026, respectively, compared to 4.7% for both the three and six months ended June 30, 2025. Other merchandise losses in our company-owned Rent-A-Center lease-to-own stores, expressed as a percentage of Rent-A-Center lease-to-own revenues, were approximately 1.1% and 1.0% for the three and six months ended June 30, 2026, respectively, compared to 1.0% and 0.9% for the three and six months ended June 30, 2025, respectively. Other merchandise losses include unrepairable and missing merchandise and loss/damage waiver claims.

Current wording

Operating Profit. Operating profit as a percentage of segment revenues was 12.1% and 12.3% for the three and nine months ended September 30, 2026, respectively, compared to 12.2% and 13.1% for the three and nine months ended September 30, 2025, respectively. The decrease in operating profit margin for the three and nine months ended September 30, 2026, as compared to the three and nine months ended September 30, 2025, was partially driven by the decrease in gross profit described above, in addition to increases in merchandise losses, advertising expenses, and insurance costs. Merchandise losses in our company-owned Rent-A-Center lease-to-own stores due to LCOs, expressed as a percentage of Rent-A-Center lease-to-own revenues, were approximately 5.4% and 5.0% for the three and nine months ended September 30, 2026, respectively, compared to 4.7% for both the three and nine months ended September 30, 2025. Other merchandise losses in our company-owned Rent-A-Center lease-to-own stores, expressed as a percentage of Rent-A-Center lease-to-own revenues, were approximately 1.1% and 1.0% for the three and nine months ended September 30, 2026, respectively, compared to 1.0% and 0.9% for the three and nine months ended September 30, 2025, respectively. Other merchandise losses include unrepairable and missing merchandise and loss/damage waiver claims.

Previous wording

Revenues. The increase in revenues for the three and six months ended June 30, 2026 as compared to the three and six months ended June 30, 2025, was partially due to the six months ended June 30, 2025 including only five months of revenues after the Closing Date, in addition to an increase in Brigit subscription customers. The Brigit segment revenues included increases of $37.5 million, $9.0 million and $7.6 million in subscription revenue, transfer fee revenue and marketplace revenue, respectively.

Current wording

Revenues. The increase in revenues for the three and nine months ended September 30, 2026 as compared to the three and nine months ended September 30, 2025 was primarily due to an increase in Brigit subscription customers, in addition to the nine months ended September 30, 2025 including only eight months of revenues after the Closing Date. The Brigit segment revenues included increases of $51.4 million, $11.4 million and $11.4 million in subscription revenue, transfer fee revenue and marketplace revenue, for the nine months ended September 30, 2026, respectively.

Previous wording

Gross Profit. Gross profit as a percentage of segment revenues was 90.2% and 89.3% for the three and six months ended June 30, 2026, respectively, as compared to 88.5% and 88.1% for the three and six months ended June 30, 2025, respectively. The increase was primarily due to mix-shift changes between subscriptions and fees product categories.

Current wording

Gross Profit. Gross profit as a percentage of segment revenues was 90.0% and 89.6% for the three and nine months ended September 30, 2026, respectively, as compared to 88.5% and 88.2% for the three and nine months ended September 30, 2025, respectively. The increase was primarily due to mix-shift changes between subscriptions and fees product categories.