GREEN DOT CORP

Previous wording

Our consolidated results of operations for the three and six months ended June 30, 2026 and 2025 were as follows:

Current wording

Our consolidated results of operations for the three and nine months ended September 30, 2026 and 2025 were as follows:

Previous wording

Our total operating revenues for the three and six months ended June 30, 2026 increased $91.7 million, or 18%, and $189.1 million, or 18%, respectively, over the prior year comparable periods, driven primarily by higher revenues in our B2B Services segment partially offset by lower revenues earned in our Consumer Services segment.

Current wording

Our total operating revenues for the three and nine months ended September 30, 2026 increased $106.3 million, or 21%, and $295.3 million, or 19%, respectively, over the prior year comparable periods, driven primarily by higher revenues in our B2B Services segment partially offset by lower revenues earned in our Consumer Services segment.

Previous wording

Continued growth of certain BaaS partner programs generated an increase of 19% and 18% in our total gross dollar volume for the three and six months ended June 30, 2026, respectively, over the prior year comparable periods, which increased our total operating revenues year-over-year. However, as discussed below, our total operating revenues for the three and six months ended June 30, 2026 were negatively impacted by unfavorable trends and factors in our deposit account programs, driving, among other things, a decrease in the number of active accounts during the three months ended June 30, 2026 by 1%, as compared to the prior year period, and a decrease in purchase volume and the number of cash transfers by 6% and 2%, respectively, for the three months ended June 30, 2026 and 7% and 4%, respectively, for the six months ended June 30, 2026 from the prior year comparable periods.

Current wording

Continued growth of certain BaaS partner programs generated an increase of 19% and 18% in our total gross dollar volume for the three and nine months ended September 30, 2026, respectively, over the prior year comparable periods, which increased our total operating revenues year-over-year. However, as discussed below, our total operating revenues for the three and nine months ended September 30, 2026 were negatively impacted by unfavorable trends and factors in our deposit account programs, driving, among other things, a decrease in the number of active accounts during the three months ended September 30, 2026 by 4%, as compared to the prior year period, and a decrease in purchase volume during the three and nine months ended September 30, 2026 by 3% and 6%, respectively, from the prior year comparable periods.

Previous wording

In our B2B Services segment, revenues increased during the three and six months ended June 30, 2026 by 29% and 25%, respectively, over the prior year comparable periods. The increase was driven by strong year-over-year growth in our gross dollar volume, which increased during the three and six months ended June 30, 2026 by 22% and 21%, respectively, and to a lesser extent, growth in the number of active accounts, which increased by 9% over the prior year comparable period. We recorded a net increase in segment revenue primarily due to growth in gross dollar volume attributable to certain BaaS programs that do not generate interchange fees, resulting in higher program management service fees earned from these BaaS partners.

Current wording

In our B2B Services segment, revenues increased during the three and nine months ended September 30, 2026 by 30% and 27%, respectively, over the prior year comparable periods. The increase was driven by strong year-over-year growth in our gross dollar volume, which increased during the three and nine months ended September 30, 2026 by 22% and 21%, respectively, and to a lesser extent, growth in the number of active accounts, which increased by 6% over the prior year comparable period. We recorded a net increase in segment revenue primarily due to growth in gross dollar volume attributable to certain BaaS programs that do not generate interchange fees, resulting in higher program management service fees earned from these BaaS partners.

Previous wording

In our Consumer Services segment, revenues decreased during each of the three and six months ended June 30, 2026 by 9% from the prior year comparable periods. Our gross dollar volume and purchase volume declined by 7% and 10%, respectively, for the three months ended June 30, 2026, and the number of active accounts and direct deposit accounts declined by 12% and 7%, respectively. Similarly, gross dollar volume and purchase volume each declined for the six months ended June 30, 2026 by 8% and 11%, respectively. While we saw some moderation in these declining trends in recent periods, we believe these decreases in our Consumer Services segment remain attributable to several persistent factors, including macro-economic factors affecting consumer behavior and other competitive trends that have impacted account acquisition. These factors had a corresponding negative impact on the amount of accountholder fee revenue we earn from accounts, including monthly maintenance fees, ATM fees and interchange fees. These decreases in segment revenues were partially offset by fees generated from our overdraft protection programs due to expanded usage by our accountholders.

Current wording

In our Consumer Services segment, revenues decreased during the three and nine months ended September 30, 2026 by 8% and 9%, respectively, from the prior year comparable periods. Our gross dollar volume and purchase volume declined by 4% and 8%, respectively, for the three months ended September 30, 2026, and the number of active accounts and direct deposit accounts declined by 15% and 10%, respectively. Similarly, gross dollar volume and purchase volume each declined for the nine months ended September 30, 2026 by 6% and 10%, respectively. While we saw some moderation in these declining trends in recent periods, we believe these decreases in our Consumer Services segment remain attributable to several persistent factors, including macro-economic factors affecting consumer behavior and other competitive trends that have impacted account acquisition. These factors had a corresponding negative impact on the amount of accountholder fee revenue we earn from accounts, including monthly maintenance fees, ATM fees, transaction-based fees and interchange fees. These decreases in segment revenues were partially offset by fees generated from our overdraft protection programs due to expanded usage by our accountholders.

Previous wording

In our Money Movement Services segment, revenues decreased during the three months ended June 30, 2026 by 8% and increased by 10% during the six months ended June 30, 2026, from the prior year comparable periods. The decrease in our Money Movement Services revenue during the three months ended June 30, 2026 was driven primarily by a decrease in our tax processing revenues due to a 23% decrease in the number of tax refunds processed, principally attributable to our online tax preparation partners and the timing of when tax refunds were processed between interim periods during the first half of the year. This decrease in our Money Movement Services revenue was partially offset by an increase in cash transfer revenues during the three months ended June 30, 2026 primarily due to higher disbursements revenue per transaction from a platform partner despite a 2% decrease in cash transfers processed. The decline in the number of cash transfers processed was primarily due to a lower number of active accounts within our Consumer Services segment discussed above, partially offset by a higher number of cash transfers processed for third-party programs, which continued to represent the majority of our total cash transfers as of June 30, 2026.

Current wording

In our Money Movement Services segment, revenues decreased during the three months ended September 30, 2026 by 2% and increased by 8% during the nine months ended September 30, 2026, from the prior year comparable periods. The decrease in our Money Movement Services revenue during the three months ended September 30, 2026 was driven primarily by a decrease in our tax processing revenues due to a 25% decrease in the number of tax refunds processed, principally attributable to our online tax preparation partners. This decrease in our Money Movement Services revenue was partially offset by an increase in cash transfer revenues during the three months ended September 30, 2026 primarily due to an increase in cash transfers processed of 2% and higher disbursements revenue per transaction from a platform partner.

Previous wording

The increase in revenue in our Money Movement Services segment during the six months ended June 30, 2026 was driven primarily by an increase in our tax processing revenues and, to a lesser extent, an increase in cash transfer revenues. Although the number of tax refunds processed decreased by 9% for the six months ended June 30, 2026, as compared to the prior year period, our tax processing revenues increased due to the expansion of our taxpayer advance programs. The decrease in the number of tax refunds processed was principally attributable to our online tax preparation partners. Our cash transfer revenues increased during the six months ended June 30, 2026 despite a 4% decrease in the number of cash transfers processed due to the same reasons discussed above.

Current wording

The increase in revenue in our Money Movement Services segment during the nine months ended September 30, 2026 was driven primarily by an increase in our tax processing revenues and, to a lesser extent, an increase in cash transfer revenues. Although the number of tax refunds processed decreased by 9% for the nine months ended September 30, 2026, as compared to the prior year period, our tax processing revenues increased due to the expansion of our taxpayer advance programs. The decrease in the number of tax refunds processed was principally attributable to our online tax preparation partners. Our cash transfer revenues increased during the nine months ended September 30, 2026 due to higher disbursements revenue per transaction from a platform partner.

Previous wording

Revenues within our Corporate and Other segment increased during the three and six months ended June 30, 2026 by 31% and 67%, respectively, from the prior year comparable periods, driven primarily by a decrease in interest profit sharing arrangements with certain BaaS partners (a reduction of revenue). In addition, the increase during the six months ended June 30, 2026 was driven by an increase in net interest income earned by Green Dot Bank, primarily the result of both the size of our investments portfolio and higher yielding investments therein from our bond repositioning strategy.

Current wording

Revenues within our Corporate and Other segment increased during the three and nine months ended September 30, 2026 by 25% and 52%, respectively, from the prior year comparable periods, driven primarily by a favorable decrease in interest profit sharing arrangements with certain BaaS partners (a reduction of revenue). In addition, the increase during the nine months ended September 30, 2026 was driven by an increase in net interest income earned by Green Dot Bank, primarily the result of both the size of our investments portfolio and higher yielding investments therein from our bond repositioning strategy.

Previous wording

For the three months ended June 30, 2026, the increase in total operating expenses was driven primarily by an increase in our processing expenses from the growth in gross dollar volume associated with certain BaaS account programs within our B2B Services segment, which is discussed above. To a lesser extent, our total operating expenses increased due to an increase in other general and administrative expenses, driven primarily by higher professional services fees associated with our proposed transactions with CommerceOne and Smith Ventures, as well as our anti-money laundering ("AML") regulatory compliance initiatives, and an increase in depreciation and amortization expense and software licenses and hosting costs due to investments in our platform and operations. In addition, the increase in other general and administrative expenses reflects a reserve established for unclaimed property obligations. No comparable expense was recorded in the prior year period. These increases in other general and administrative expenses were partially offset by a decrease in overall transaction losses attributable to a decrease in customer dispute volume across our portfolios and a favorable reduction in our dispute loss rates. Total operating expenses were partially offset by a decrease in compensation and benefits expenses, driven primarily by a reduction in third-party call center support costs associated with certain of our BaaS account programs discussed above, a decrease in employee stock-based compensation expense due to a reduction in new grants of equity awards during the pendency of our proposed transactions with CommerceOne and Smith Ventures, and lower accrued bonus compensation expense due to our financial performance in the prior year period exceeding our bonus targets.

Current wording

Our total operating expenses for the nine months ended September 30, 2026 increased over the prior year comparable period, driven by similar factors as discussed above for the three months ended September 30, 2026. Our processing expenses increased during the nine months ended September 30, 2026, due to the same reasons discussed above. Other general and administrative expenses increased primarily from higher professional services fees associated with our proposed transactions with CommerceOne and Smith Ventures, as well as our anti-money laundering ("AML") regulatory compliance initiatives, and an increase in depreciation and amortization expense and software licenses and hosting costs discussed above. In addition, the increase in other general and administrative expenses reflects a reserve established for unclaimed property obligations. No comparable expense was recorded in the prior year period. These increases in other general and administrative expenses were partially offset by a decrease in overall transaction losses attributable to a decrease in customer dispute volume across our portfolios and a favorable reduction in our dispute loss rates. Compensation and benefits expenses also decreased due to the same reasons discussed above, and were further partially offset from a reduction in third-party call center support costs associated with certain of our BaaS account programs and severance benefits that did not recur at the same magnitude in the current period as a result of our reduction in employee workforce in the comparable prior year period. Sales and marketing expenses decreased principally due to a decrease in supply chain materials expenses, which are comprised of debit card plastics and related materials costs, from fewer active accounts and a decrease in advertising and promotion expenses, partially offset by an increase in revenue-sharing arrangements in our tax processing business.

Previous wording

Other income and expense, net for the three and six months ended June 30, 2026 decreased $74.7 million and $100.6 million, respectively, from the prior year comparable periods. These decreases resulted principally from charges that did not recur in the current period, including a $70 million incentive payment made by TailFin Labs, LLC ("TailFin") in connection with the extension of the Walmart MoneyCard agreement and related agreements in May 2025. In addition, during the first quarter of 2025, we determined we would sell certain available-for-sales securities in order to reposition the proceeds into higher yielding assets, which resulted in a realized loss of $24.8 million for the six months ended June 30, 2025.

Current wording

Other expense, net for the three and nine months ended September 30, 2026 was approximately flat and decreased $100.5 million, respectively, from the prior year comparable periods. The decrease for the nine-months ended September 30, 2026 resulted principally from charges that did not recur in the current period, including a $70 million incentive payment made by TailFin Labs, LLC ("TailFin") in connection with the extension of the Walmart MoneyCard agreement and related agreements in May 2025. In addition, during the first quarter of 2025, we determined we would sell certain available-for-sales securities in order to reposition the proceeds into higher yielding assets, which resulted in a realized loss of $24.8 million for the nine months ended September 30, 2026.

Previous wording

We intend to continue to make growth-oriented investments and incur other expenditures that we believe will benefit our long-term financial results. Our growth-oriented investments are focused on, among other things, accelerating our ability to onboard new partners in our B2B Services and Money Movement Services segments, adding new features and functionality to our Arc platform, cost-effectively implementing strategic marketing initiatives in support of our GO2bank product, and other initiatives across our account programs with the objective of returning to active account growth. In 2025, we initiated a re-alignment of teams and resources across the enterprise in a continual effort to better support our strategic priorities and growth channels, and improve our operating efficiency. We expect these re-alignments, including the exit from our operational activities in China, to further improve our cost structure year-over-year.

Current wording

We intend to continue to make growth-oriented investments and incur other expenditures that we believe will benefit our long-term financial results. Our growth-oriented investments are focused on, among other things, accelerating our ability to onboard new partners in our B2B Services and Money Movement Services segments, adding new features and functionality to our Arc platform, implementing cost-effective strategic marketing initiatives in support of our products that we market through direct-to-consumer channels, and other initiatives across our account programs with the objective of returning to active account growth. In 2025, we initiated a re-alignment of teams and resources across the enterprise in a continual effort to better support our strategic priorities and growth channels, and improve our operating efficiency. We expect these re-alignments, including the exit from our operational activities in China, to further improve our cost structure year-over-year.

Previous wording

In December 2025, the Federal Reserve decreased interest rates by an additional 25 basis points to a current range of 3.50% to 3.75%. The Federal Reserve's decision-making policies for short-term interest rates will continue to impact the amount of net interest income we earn in the future. In general, while higher short-term interest rates benefit the yield we earn on our cash, certain of our BaaS partner arrangements allow for the BaaS partner to share in a significant portion of the interest earned from accountholder deposits (which are recorded as a reduction of revenue in our consolidated financial statements), and fixed yields on our investment portfolio tend to lag interest rate increases as securities mature and proceeds are reinvested. Accordingly, the net effect has had, and we expect will continue to have, a negative impact on our consolidated financial statements and will be dependent upon future interest rate changes enacted by the Federal Reserve. In an effort to mitigate these impacts, beginning in the second quarter of 2025, we started to gradually reposition a portion of our investment securities portfolio and our cash into variable rate debt securities to improve net yields, and we continue with our investment strategies to balance the effect of our interest sharing arrangements with BaaS partners.

Current wording

In September 2026, the Federal Reserve increased interest rates by 25 basis points to a current range of 3.75% to 4.00%, the first rate increase in several years. The Federal Reserve's decision-making policies for short-term interest rates will continue to impact the amount of net interest income we earn in the future. In general, while higher short-term interest rates benefit the yield we earn on our cash, certain of our BaaS partner arrangements allow for the BaaS partner to share in a significant portion of the interest earned from accountholder deposits (which are recorded as a reduction of revenue in our consolidated financial statements), and fixed yields on our investment portfolio tend to lag interest rate increases as securities mature and proceeds are reinvested. Accordingly, the net effect has had, and we expect will continue to have, a negative impact on our consolidated financial statements and will be dependent upon future interest rate changes enacted by the Federal Reserve. In an effort to mitigate these impacts, beginning in the second quarter of 2025, we started to gradually reposition a portion of our investment securities portfolio and our cash into variable rate debt securities to improve net yields, and we continue with our investment strategies to balance the effect of our interest sharing arrangements with BaaS partners.

Previous wording

Other income and expense, net includes income and expenses we generally do not consider normal operating activities, such as earnings, losses or impairment attributable to equity method investments, realized gains or losses on investment securities, income earned on bank-owned life insurance policies, and changes in valuation allowances on loans held for sale, amongst other similar items that may arise from time to time.

Current wording

Other expense, net includes income and expenses we generally do not consider normal operating activities, such as earnings, losses or impairment attributable to equity method investments, realized gains or losses on investment securities, income earned on bank-owned life insurance policies, and changes in valuation allowances on loans held for sale, amongst other similar items that may arise from time to time.

Previous wording

Our income tax expense consists of the federal and state corporate income taxes accrued on income resulting from the sale of our products and services. Our effective income tax rate may differ from the 21% U.S. federal statutory rate due to a number of factors, including state income taxes, research and development tax credits, non-deductible expenses, increases or decreases in valuation allowances and liabilities for uncertain tax positions, excess tax benefits or shortfalls on stock compensation awards, audit developments, and legislative changes. See

Current wording

Our income tax expense consists of the federal and state corporate income taxes accrued on income resulting from the sale of our products and services. Our effective income tax rate may differ from the 21% U.S. federal statutory rate due to a number of factors, including state income taxes, research and development tax credits, nondeductible expenses, the tax benefit from the cash surrender value of bank-owned life insurance policies, increases or decreases in valuation allowances and liabilities for uncertain tax positions, excess tax benefits or shortfalls on stock compensation awards, the recognition of discounts on purchased transferable tax credits when the credits are used, audit developments, and legislative changes. See Note 10—Income Taxesto the Consolidated Financial Statements included herein for a discussion of the significant tax differences that impacted our effective tax rate.

Previous wording

There have been no material changes during the six months ended June 30, 2026 to the critical accounting estimates disclosed in Management's Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the year ended December 31, 2025.

Current wording

There have been no material changes during the nine months ended September 30, 2026 to the critical accounting estimates disclosed in Management's Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the year ended December 31, 2025.

Previous wording

Card Revenues and Other Fees — Card revenues and other fees totaled $476.9 million for the three months ended June 30, 2026, an increase of $95.7 million, or 25%, from the comparable prior year period. Card revenues and other fees increased primarily due to growth in gross dollar volume in our B2B Services segment programs, which resulted in higher program management service fees earned from our BaaS partners. These increases were partially offset by decreases in certain accountholder fees, such as monthly maintenance fees and ATM fees, as a result of a decline in the number of active accounts in our Consumer Services segment during the current period. Decreases in accountholder fees were partially offset by an increase in fees generated from our overdraft protection programs due to expanded usage by our accountholders.

Current wording

Card Revenues and Other Fees — Card revenues and other fees totaled $499.6 million for the three months ended September 30, 2026, an increase of $106.5 million, or 27%, from the comparable prior year period. Card revenues and other fees increased primarily due to growth in gross dollar volume in our B2B Services segment programs, which resulted in higher program management service fees earned from our BaaS partners. These increases were partially offset by decreases in certain accountholder fees, such as monthly maintenance fees, ATM fees and transaction-based fees, as a result of a decline in the number of active accounts in our Consumer Services segment during the current period. Decreases in accountholder fees were partially offset by an increase in fees generated from our overdraft protection programs due to expanded usage by our accountholders.

Previous wording

Cash Processing Revenues — Cash processing revenues totaled $53.3 million for the three months ended June 30, 2026, a decrease of $1.2 million, or 2%, from the comparable prior year period. Cash processing revenues decreased as a result of lower tax processing revenues, which decreased due to a 23% decrease in the number of tax refunds processed and lower ancillary tax program fees that are associated with tax refund transfers. The decrease in the number of tax refunds processed was principally attributable to the performance of our online tax preparation partners. This decrease was partially offset by an increase in cash transfer revenues primarily due to higher disbursements revenue earned per transaction from a platform partner despite a 2% decrease in cash transfers processed. The decline in the number of cash transfers processed was primarily due to a lower number of active accounts within our Consumer Services segment, partially offset by a higher number of cash transfers processed for third-party programs.

Current wording

Cash Processing Revenues — Cash processing revenues totaled $35.9 million for the three months ended September 30, 2026, an increase of $2.1 million, or 6%, from the comparable prior year period. Cash processing revenues increased as a result of an increase in cash transfer revenues primarily due to higher disbursements revenue earned per transaction from a platform partner and a 2% increase in the number of cash transfers processed. This increase was partially offset by lower tax processing revenues, which decreased due to a 25% decrease in the number of tax refunds processed. The decrease in the number of tax refunds processed was principally attributable to the performance of our online tax preparation partners.

Previous wording

Interchange Revenues — Interchange revenues totaled $44.2 million for the three months ended June 30, 2026, a decrease of $2.8 million, or 6%, from the comparable prior year period. The decrease was primarily due to a decrease in purchase volume of 6% as our effective interchange rate earned from the comparable prior year period remained consistent. Our interchange fees have both fixed and variable components, and as a result, the effective rate we earn may vary based on the size of transactions, among other factors.

Current wording

Interchange Revenues — Interchange revenues totaled $43.1 million for the three months ended September 30, 2026, a decrease of $2.2 million, or 5%, from the comparable prior year period. The decrease was primarily due to a decrease in purchase volume of 3%, as well as a lower effective interchange rate earned from the comparable prior year period. Our interchange fees have both fixed and variable components, and as a result, the effective rate we earn may vary based on the size of transactions, among other factors.

Previous wording

Interest Income, net — Net interest income totaled $48.7 million for the six months ended June 30, 2026, an increase of $5.6 million, or 12%, from the comparable prior year period. The increase in net interest income was primarily the result of both the size of our investments portfolio and higher yielding investments therein from our bond repositioning strategy.

Current wording

Interest Income, net — Net interest income totaled $22.5 million for the three months ended September 30, 2026, a decrease of $0.2 million, or 1%, from the comparable prior year period. The changes in net interest income was primarily the result of the composition of our interest-earning assets due to the bond repositioning strategy of our investments portfolio, offset by the amount of interest shared with certain BaaS partners (a reduction of revenue).

Previous wording

Processing Expenses — Processing expenses totaled $394.7 million for the three months ended June 30, 2026, an increase of $101.5 million, or 35%, from the comparable prior year period. This increase was principally due to growth in gross dollar volume on certain BaaS account programs within our B2B Services segment.

Current wording

Processing Expenses — Processing expenses totaled $411.9 million for the three months ended September 30, 2026, an increase of $102.6 million, or 33%, from the comparable prior year period. This increase was principally due to growth in gross dollar volume on certain BaaS account programs within our B2B Services segment.

Previous wording

Our income tax benefit totaled $0.3 million for the three months ended June 30, 2026, representing a decrease of $15.6 million from the prior year comparable period, primarily due to an increase in our income before taxes.

Current wording

Our income tax benefit totaled $2.6 million for the three months ended September 30, 2026, representing a decrease of $2.3 million from the prior year comparable period, primarily due to a decrease in the amount of our loss before income taxes.

Previous wording

Card Revenues and Other Fees — Card revenues and other fees totaled $925.6 million for the six months ended June 30, 2026, an increase of $168.4 million, or 22%, from the comparable prior year period. This increase was driven principally by the same factors discussed above under “Comparison of Three-Month Periods Ended June 30, 2026 and 2025—Operating Revenues—Card Revenues and Other Fees."

Current wording

Card Revenues and Other Fees — Card revenues and other fees totaled $1,425.2 million for the nine months ended September 30, 2026, an increase of $275.0 million, or 24%, from the comparable prior year period. This increase was driven principally by the same factors discussed above under “Comparison of Consolidated Results for the Three-Months Ended September 30, 2026 and 2025—Operating Revenues—Card Revenues and Other Fees."

Previous wording

Cash Processing Revenues — Cash processing revenues totaled $189.7 million for the six months ended June 30, 2026, an increase of $21.8 million, or 13%, from the comparable prior year period. Cash processing revenues increased primarily due to an increase in our tax processing revenues and to a lesser extent, an increase in cash transfer revenues. Although the number of tax refunds processed decreased by 9% for the six months ended June 30, 2026, as compared to the prior year period, our tax processing revenues increased due to the expansion of our taxpayer advance programs. The decrease in the number of tax refunds processed was principally attributable to our online tax preparation partners. Our cash transfer revenues increased during the six months ended June 30, 2026 primarily due to higher disbursements revenue earned per transaction from a platform partner despite a 4% decrease in the number of cash transfers. The decline in the number of cash transfers processed was primarily due to a lower number of active accounts within our Consumer Services segment and to a lesser extent, a lower number of cash transfers processed for third-party programs.

Current wording

Cash Processing Revenues — Cash processing revenues totaled $225.6 million for the nine months ended September 30, 2026, an increase of $24.0 million, or 12%, from the comparable prior year period. Cash processing revenues increased primarily due to an increase in our tax processing revenues and to a lesser extent, an increase in cash transfer revenues. Although the number of tax refunds processed decreased by 9% for the nine months ended September 30, 2026, as compared to the prior year period, our tax processing revenues increased due to the expansion of our taxpayer advance programs. The decrease in the number of tax refunds processed was principally attributable to our online tax preparation partners. Our cash transfer revenues increased during the nine months ended September 30, 2026 primarily due to higher disbursements revenue earned per transaction from a platform partner despite a 2% decrease in the number of cash transfers. The decline in the number of cash transfers processed was primarily due to a lower number of active accounts within our Consumer Services segment.

Previous wording

Interchange Revenues — Interchange revenues totaled $88.1 million for the six months ended June 30, 2026, a decrease of $6.8 million, or 7%, from the comparable prior year period. The decrease was primarily due to a decrease in purchase volume of 7% and for the same reasons as discussed under “Comparison of Three-Month Periods Ended June 30, 2026 and 2025—Operating Revenues—Interchange Revenues."

Current wording

Interchange Revenues — Interchange revenues totaled $131.2 million for the nine months ended September 30, 2026, a decrease of $9.0 million, or 6%, from the comparable prior year period. The decrease was primarily due to a decrease in purchase volume of 6% as our effective interchange rate earned from the comparable prior year period remained consistent.

Previous wording

Interest Income, net — Net interest income totaled $21.5 million for the three months ended June 30, 2026, consistent with the comparable prior year period. The changes in net interest income was primarily the result of an increase in the size of our investments portfolio and higher yielding investments therein from our bond repositioning strategy, which was offset by interest shared with certain BaaS partners (a reduction of revenue).

Current wording

Interest Income, net — Net interest income totaled $71.2 million for the nine months ended September 30, 2026, an increase of $5.4 million, or 8%, from the comparable prior year period. The changes in net interest income was primarily the result of an increase in the size of our investments portfolio and higher yielding investments therein from our bond repositioning strategy, partially offset by interest shared with certain BaaS partners (a reduction of revenue).

Previous wording

Sales and Marketing Expenses — Sales and marketing expenses totaled $49.4 million for the three months ended June 30, 2026, a decrease of $0.8 million, or 2%, from the comparable prior year period. This decrease was driven primarily by a decrease in supply chain materials expenses, which are comprised of card packages and personalized debit cards, from fewer active accounts and a decrease in our revenue-sharing arrangements in our Consumer Services business.

Current wording

Sales and Marketing Expenses — Sales and marketing expenses totaled $155.1 million for the nine months ended September 30, 2026, a decrease of $3.0 million, or 2%, from the comparable prior year period. This decrease was driven primarily by a decrease in supply chain materials expenses, which are comprised of debit card plastics and related materials costs, from fewer active accounts and a decrease in advertising and promotion expenses, partially offset by an increase in revenue-sharing arrangements in our tax processing business.

Previous wording

Compensation and Benefits Expenses — Compensation and benefits expenses totaled $59.0 million for the three months ended June 30, 2026, a decrease of $4.8 million, or 8%, from the comparable prior year period. The decrease was driven primarily by a decrease in third-party call center support costs associated with certain BaaS account programs within our B2B Services segment, a decrease in employee stock-based compensation expense due to a reduction in new grants of equity awards during the pendency of our proposed transactions with CommerceOne and Smith Ventures, and lower accrued bonus compensation expense due to our financial performance in the prior year period exceeding our bonus targets.

Current wording

Compensation and Benefits Expenses — Compensation and benefits expenses totaled $175.0 million for the nine months ended September 30, 2026, a decrease of $18.5 million, or 10%, from the comparable prior year period. The decrease was driven primarily by a decrease in third-party call center support costs associated with certain BaaS account programs within our B2B Services segment, a decrease in severance costs from reductions in employee workforce that did not recur, lower accrued bonus compensation expense and lower employee stock-based compensation expense.

Previous wording

Processing Expenses — Processing expenses totaled $769.3 million for the six months ended June 30, 2026, an increase of $190.8 million, or 33%, from the comparable prior year period. This increase was driven primarily by the same factors discussed above under “Comparison of Three-Month Periods Ended June 30, 2026 and 2025—Operating Expenses—Processing Expenses."

Current wording

Processing Expenses — Processing expenses totaled $1,181.2 million for the nine months ended September 30, 2026, an increase of $293.4 million, or 33%, from the comparable prior year period. This increase was driven primarily by the same factors discussed above under “Comparison of Consolidated Results for the Three-Months Ended September 30, 2026 and 2025—Operating Expenses—Processing Expenses."

Previous wording

Other General and Administrative Expenses — Other general and administrative expenses totaled $93.5 million for the three months ended June 30, 2026, an increase of $9.9 million, or 12%, from the comparable prior year period. This increase was driven primarily by higher professional services fees associated with our proposed transactions with CommerceOne and Smith Ventures, and our AML regulatory compliance initiatives, and an increase in depreciation and amortization expense and software licenses and hosting costs due to investments in our platform and operations. In addition, the increase in other general and administrative expenses reflects a reserve established for unclaimed property obligations. No comparable expense was recorded in the prior year period. These increases were partially offset by a decrease in overall transaction losses attributable to a decrease in customer dispute volume across our portfolios and a favorable reduction in our dispute loss rates.

Current wording

Other General and Administrative Expenses — Other general and administrative expenses totaled $280.3 million for the nine months ended September 30, 2026, an increase of $23.0 million, or 9%, from the comparable prior year period. This increase was driven primarily by higher professional services fees associated with our proposed transactions with CommerceOne and Smith Ventures, and our AML regulatory compliance initiatives, and an increase in depreciation and amortization expense and software licenses and hosting costs due to investments in our platform and operations. In addition, the increase in other general and administrative expenses reflects a reserve established for unclaimed property obligations. No comparable expense was recorded in the prior year period. These increases were partially offset by a decrease in overall transaction losses attributable to a decrease in customer dispute volume across our portfolios and a favorable reduction in our dispute loss rates.

Previous wording

Restructuring and Other Charges — Restructuring and other charges totaled $0.2 million for the six months ended June 30, 2026, due to our previously announced restructuring plan. Additionally, refer to Note 19—Restructuring and Other Chargesin the Consolidated Financial Statements included herein for a more detailed discussion of our restructuring and other charges.

Current wording

Restructuring and Other Charges — Restructuring and other charges totaled $0.3 million for the nine months ended September 30, 2026, due to our previously announced restructuring plan. Additionally, refer to Note 19—Restructuring and Other Chargesin the Consolidated Financial Statements included herein for a more detailed discussion of our restructuring and other charges.

Previous wording

Other income and expense, net totaled $0.01 million for the three months ended June 30, 2026, a decrease of $74.7 million, from the prior year comparable period. This decrease was driven by our equity method losses associated with TailFin and resulted principally from a $70 million incentive payment that TailFin made in connection with the extension of the Walmart MoneyCard agreement and related agreements in May 2025. The incentive payment, which did not recur in the current period, was recorded as a component of equity in losses attributable to TailFin during the second quarter of 2025 under our HLBV method of accounting.

Current wording

Other expense, net totaled $1.3 million for the nine months ended September 30, 2026, a decrease of $100.5 million, from the prior year comparable period. This decrease was driven by our equity method losses associated with TailFin and resulted principally from a $70 million incentive payment that TailFin made in connection with the extension of the Walmart MoneyCard agreement and related agreements in May 2025. The incentive payment, which did not recur in the current period, was recorded as a component of equity in losses attributable to TailFin during the second quarter of 2025 under our HLBV method of accounting. In addition, during the first quarter of 2025, we determined we would sell certain available-for-sales securities in order to reposition the proceeds into higher yielding assets, which resulted in a realized loss of $24.8 million for the nine months ended September 30, 2025.

Previous wording

Our income tax expense totaled $13.6 million for the six months ended June 30, 2026, representing an increase of $21.6 million from the prior year comparable period, primarily due to an increase in our income before taxes.

Current wording

Our income tax expense totaled $11.0 million for the nine months ended September 30, 2026, representing an increase of $24.0 million from the prior year comparable period, primarily due to our income before income taxes of $55.3 million, compared to a loss before income taxes of $65.0 million for the prior year comparable period.

Previous wording

The net decrease in our effective tax rate for the six months ended June 30, 2026 from the prior year comparable period was due to several factors, including a decrease of $1.4 million in tax expense associated with shortfalls from stock-based compensation, an increase of $0.9 million in the tax benefit from the cash surrender value in bank-owned life insurance policies, and a higher tax rate benefit due to an increase of $1.0 million in general business credits. These decreases were partially offset by an increase of $2.7 million in state income taxes expense, net of federal benefits, an increase of $0.4 million in the amount of compensation expense that was subject to the IRC 162(m) limitation on the deductibility of certain executive compensation, an increase of $0.4 million in nondeductible transaction related costs, and an increase in the valuation allowance recorded against our 2026 federal and state research credits. For the six months ended June 30, 2026, we recorded valuation allowances of $1.1 million against our 2026 federal research credits, which is reflected in change in valuation allowance, and $1.1 million against our 2026 state research credits, reflected in state income taxes, net of federal tax benefit in our effective tax rate reconciliation.

Current wording

Our effective tax rate was 19.9% for the nine months ended September 30, 2026, consistent with the prior year comparable period. Compared to the prior year period, income tax expense for the nine months ended September 30, 2026 reflects an increase of $3.3 million in state income taxes, net of federal benefit, $0.6 million of tax expense from nondeductible transaction related costs associated with our proposed transactions with CommerceOne and Smith Ventures, and an increase of $0.1 million in tax expense from the IRC 162(m) limitation on the deductibility of certain executive compensation. These increases were partially offset by a decrease of $1.6 million in tax expense associated with shortfalls from stock-based compensation, a decrease of $1.4 million in tax expense from changes in valuation allowances, a decrease of $1.0 million in tax expense from the foreign tax rate differential, an increase of $0.7 million in the tax benefit from the cash surrender value of bank-owned life insurance policies, and an increase of $0.5 million in the benefit from general business credits. For the nine months ended September 30, 2026, the change in valuation allowance of $1.2 million primarily reflects the valuation allowance recorded against our 2026 federal research credits. In addition, valuation allowances recorded against our 2026 state research credits increased income tax expense by $1.1 million, reflected in state income taxes, net of federal tax benefit, in our effective tax rate reconciliation. The "Other" category in our effective tax rate consists of a variety of permanent differences, none of which were individually significant.

Previous wording

Segment revenues within our B2B Services for the three and six months ended June 30, 2026 increased $99.8 million, or 29%, and $175.3 million, or 25%, respectively, from the prior year comparable periods, while our segment expenses for the three and six months ended June 30, 2026 increased $95.3 million, or 30%, and $169.3 million, or 27%, respectively.

Current wording

Segment revenues within our B2B Services for the three and nine months ended September 30, 2026 increased $109.7 million, or 30%, and $285.1 million, or 27%, respectively, from the prior year comparable periods, while our segment expenses for the three and nine months ended September 30, 2026 increased $108.1 million, or 32%, and $277.4 million, or 29%, respectively.

Previous wording

Our gross dollar volume and number of active accounts increased during the three months ended June 30, 2026 by 22% and 9%, respectively, over the comparable prior year period, while purchase volume increased by 1% year over year. We have continued to experience organic growth from both new and existing users concentrated in certain BaaS programs that tend to yield higher gross dollar volume per active user but do not generate comparable levels of interchange fees. The growth in gross dollar volume from these BaaS programs resulted in a net increase in segment revenue for the three and six months ended June 30, 2026 due to higher program management service fees earned from these BaaS partners.

Current wording

Our gross dollar volume and number of active accounts increased during the three months ended September 30, 2026 by 22% and 6%, respectively, over the comparable prior year period, and purchase volume increased by 3% year over year. We have continued to experience organic growth from both new and existing users concentrated in certain BaaS programs that tend to yield higher gross dollar volume per active user but do not generate comparable levels of interchange fees. The growth in gross dollar volume from these BaaS programs resulted in a net increase in segment revenue for the three and nine months ended September 30, 2026 due to higher program management service fees earned from these BaaS partners.

Previous wording

Segment expenses increased for the three and six months ended June 30, 2026 over the comparable prior year periods, principally due to higher processing expenses associated with the growth of certain BaaS account programs, partially offset by lower third-party call center support costs as a result of decreases in call volume and lower transaction losses due to decreases in our dispute loss rates and incoming volume. As a result of these factors, our segment profit increased for the three and six months ended June 30, 2026 by approximately 16% and 11%, respectively, from the prior year comparable periods. However, this segment also experienced margin compression because certain BaaS partnerships are largely structured based on a fixed profit and therefore, our segment profit for certain arrangements will not scale with revenue growth.

Current wording

Segment expenses increased for the three months ended September 30, 2026 over the comparable prior year period, principally due to higher processing expenses associated with the growth of certain BaaS account programs, and to a lesser extent, higher third-party call center support costs as a result of increases in call volume and higher transaction losses attributable to the growth in gross dollar volume associated with certain BaaS account programs. Similarly, segment expenses increased for the nine months ended September 30, 2026 principally due to higher processing expenses, however, was partially offset by lower third-party call center support costs and lower transaction losses due to lower incoming dispute volume. As a result of these factors, our segment profit increased for the three and nine months ended September 30, 2026 by approximately 6% and 9%, respectively, from the prior year comparable periods. However, this segment also experienced margin compression because certain BaaS partnerships are largely structured based on a fixed profit and therefore, our segment profit for certain arrangements will not scale with revenue growth.

Previous wording

Segment revenues within Consumer Services for the three and six months ended June 30, 2026 decreased $8.3 million, or 9%, and $17.1 million, or 9%, respectively, from the comparable prior year periods, while our segment expenses for the three and six months ended June 30, 2026 decreased by $1.1 million, or 2%, and $1.7 million, or 1%, respectively.

Current wording

Segment revenues within Consumer Services for the three and nine months ended September 30, 2026 decreased $7.0 million, or 8%, and $24.2 million, or 9%, respectively, from the comparable prior year periods, while our segment expenses for the three and nine months ended September 30, 2026 decreased by $2.9 million, or 5%, and $4.6 million, or 3%, respectively.

Previous wording

Our gross dollar volume and purchase volume declined by 7% and 10%, respectively, for the three months ended June 30, 2026 from the prior year comparable period, and the number of active accounts and direct deposit accounts declined by 12% and 7%, respectively, primarily due to each of the factors discussed above in "Overview." These factors include macro-economic factors leading to economic challenges for consumers and other competitive trends that have impacted account acquisition. Our gross dollar volume and purchase volume decreased year over year by similar levels during the six months ended June 30, 2026. As a result of these decreases in each of our key metrics, our monthly maintenance fee revenues, ATM fee revenues and interchange revenues decreased year over year. These decreases in segment revenues were partially offset by fees generated from our overdraft protection programs due to expanded usage by our accountholders.

Current wording

Our gross dollar volume and purchase volume declined by 4% and 8%, respectively, for the three months ended September 30, 2026 from the prior year comparable period, and the number of active accounts and direct deposit accounts declined by 15% and 10%, respectively, primarily due to each of the factors discussed above in "Overview." These factors include macro-economic factors leading to economic challenges for consumers and other competitive trends that have impacted account acquisition. Our gross dollar volume and purchase volume decreased year over year by similar levels during the nine months ended September 30, 2026. As a result of these decreases in each of our key metrics, our monthly maintenance fee revenues, ATM fee revenues, transaction-based fees, and interchange revenues decreased year over year. These decreases in segment revenues were partially offset by fees generated from our overdraft protection programs due to expanded usage by our accountholders.

Previous wording

Segment expenses for the three and six months ended June 30, 2026 decreased from the comparable prior year periods primarily due to a decrease in overall transaction losses attributable to lower customer dispute volume across our portfolios and favorable reductions in our dispute loss rates, lower supply chain material expenses due to fewer active accounts, and a decrease in sales commissions from lower revenues on products subject to tiered revenue-sharing agreements.

Current wording

Segment expenses for the three and nine months ended September 30, 2026 decreased from the comparable prior year periods primarily due to a decrease in overall transaction losses attributable to lower customer dispute volume across our portfolios and favorable reductions in our dispute loss rates, lower supply chain material expenses due to fewer active accounts, and a decrease in sales commissions from lower revenues on products subject to tiered revenue-sharing agreements.

Previous wording

Overall, segment profit decreased for the three and six months ended June 30, 2026 by approximately 22% and 23%, respectively, from the prior year comparable periods.

Current wording

Overall, segment profit decreased for the three and nine months ended September 30, 2026 by approximately 13% and 20%, respectively, from the prior year comparable periods.