PROG Holdings, Inc.

Previous wording

The following discussion should be read in conjunction with the condensed consolidated financial statements as of and for the three and six months ended June 30, 2026 and 2025, including the notes to those statements, appearing elsewhere in this report. We also suggest that management's discussion and analysis appearing in this report be read in conjunction with the management's discussion and analysis and consolidated financial statements included in our 2025 Annual Report.

Current wording

The following discussion should be read in conjunction with the condensed consolidated financial statements as of and for the three and nine months ended September 30, 2026 and 2025, including the notes to those statements, appearing elsewhere in this report. We also suggest that management's discussion and analysis appearing in this report be read in conjunction with the management's discussion and analysis and consolidated financial statements included in our 2025 Annual Report.

Previous wording

Vive Financial ("Vive"), an omnichannel provider of second-look revolving credit products, had been an operating segment prior to October 20, 2025. On that date, the Company sold substantially all of Vive's loan receivables portfolio and began the process of discontinuing its remaining operations. Vive is reported as discontinued operations in our condensed consolidated financial statements for all periods presented. All of Vive's revenues and expenses, other than allocated corporate overhead, are excluded from the results of continuing operations.

Current wording

Vive Financial ("Vive"), an omnichannel provider of second-look revolving credit products, had been an operating segment prior to October 20, 2025. On that date, the Company sold substantially all of Vive's loans receivable portfolio and began the process of discontinuing its remaining operations. Vive is reported as discontinued operations in our condensed consolidated financial statements for all periods presented. All of Vive's revenues and expenses, other than allocated corporate overhead, are excluded from the results of continuing operations.

Previous wording

We believe the increased cost of living and recent rise in fuel costs has continued to have a disproportionate negative effect on our customers' disposable income, negatively affecting demand for many products offered by our businesses, as well as in customer payment performance. The significant increase in inflation resulting from the war in Iran and related geopolitical disruption has further pressured our customers' budgets and unfavorably impacted consumer confidence within our customer base, resulting in a decrease in demand for the types of larger-ticket, durable consumer goods offered by many of our retail partners and by our Purchasing Power business.

Current wording

We believe the increased cost of living and recent rise in fuel costs have continued to have a disproportionate negative effect on our customers' disposable income, negatively affecting demand for many products offered by our businesses, as well as customer payment performance. The significant increase in inflation resulting from the war in Iran and related geopolitical disruption has further pressured our customers' budgets and unfavorably impacted consumer confidence within our customer base, resulting in a decrease in demand for the types of larger-ticket, durable consumer goods offered by many of our retail partners and by our Purchasing Power business.

Previous wording

Progressive Leasing entered 2026 with a smaller lease portfolio, as measured by its gross leased asset balance, compared to 2025, which resulted in a decrease in lease revenues when compared to the three and six months ended June 30, 2025. Gross margin as a percentage of revenue increased from the prior-year periods, driven primarily by a lower rate of early purchase option activity. Macroeconomic conditions contributed to fewer customers exercising early purchase options and more customers making payments over the full lease term, which generally results in greater margin realization.

Current wording

GMV increased by $9.5 million for Progressive Leasing in the third quarter of 2026, compared to the same period in the prior year. Despite the increase in GMV in the third quarter of 2026, lease revenue declined for both the three and nine months ended September 30, 2026 compared to the prior-year periods, primarily due to lower average gross leased asset balance resulting from smaller lease portfolios entering those periods. Gross margin as a percentage of revenue was relatively unchanged for the three-month period and increased for the nine-month period ended September 30, 2026 compared to the prior year, primarily due to reduced early purchase option activity during the first half of 2026. Macroeconomic conditions contributed to fewer customers exercising early purchase options and more customers making payments over the full lease term, which generally results in greater margin realization.

Previous wording

Customer payment delinquencies were elevated at the end of 2024 and during the first quarter of 2025, which prompted us to tighten our decisioning posture to maintain a healthy lease portfolio. While this action benefited our lease portfolio performance, it also negatively impacted Progressive Leasing's GMV during the periods subsequent to the change. In addition, elevated delinquencies in the second quarter of 2026 contributed to a provision for lease merchandise write-offs as a percentage of Progressive Leasing revenue of 8.4% compared to 7.5% in the prior year period. As a result, Progressive Leasing recently further tightened its decisioning posture, which is expected to continue to pressure GMV in future periods while supporting portfolio performance. Despite these trends, customer payment activity remained within expected ranges, and gross margin as a percentage of revenues increased during the three and six months ended June 30, 2026 when compared to the prior year.

Current wording

Progressive Leasing experienced elevated delinquencies in the second and third quarters of 2026, which contributed to a provision for lease merchandise write-offs as a percentage of Progressive Leasing revenue of 8.3% during the three months ended September 30, 2026 compared to 7.4% in the prior year period. As a result, Progressive Leasing further tightened its decisioning posture late in the second quarter and again in the third quarter of 2026, which is expected to continue to pressure GMV in future periods while supporting portfolio performance. The Company will continue to actively manage underwriting and decisioning criteria to support portfolio performance.

Previous wording

While customer payment delinquencies and write-offs for Purchasing Power are generally lower than those of Progressive Leasing due to Purchasing Power's payroll deduction and allotment repayment model, delinquencies on non-federal employee receivables were elevated in the second quarter of 2026, which resulted in a higher than estimated provision for credit losses. Delinquencies for federal government employee receivables have improved compared to the elevated delinquencies experienced in 2025 resulting from various workforce disruptions, including DOGE workforce reductions and multiple government shutdowns. We continue to monitor these conditions, as well as increased turnover (both voluntary and involuntary) at Purchasing Power's clients, as prolonged uncertainty could pose additional risk to Purchasing Power's receivables performance.

Current wording

Customer payment delinquencies and write-offs for Purchasing Power are generally lower than those of Progressive Leasing due to Purchasing Power's payroll deduction and allotment repayment model. Delinquencies on non-federal employee receivables in the third quarter of 2026 were in line with expectations and the same period in the prior year. Delinquencies for federal government employee receivables have generally improved compared to the elevated delinquencies experienced in 2025 resulting from various workforce disruptions, including DOGE workforce reductions and multiple government shutdowns.

Previous wording

Due to the average ticket size of a BNPL transaction with Four being significantly lower than a transaction with Progressive Leasing and Purchasing Power, we believe demand for products purchased through the use of Four is not as impacted by the macroeconomic headwinds discussed above to the same degree as demand for larger-ticket products.

Current wording

Due to the average ticket size of a BNPL transaction with Four being significantly lower than a transaction with Progressive Leasing and Purchasing Power, we believe demand for products purchased through the use of Four is not impacted by the macroeconomic headwinds discussed above to the same degree as demand for larger-ticket products.

Previous wording

•We reported consolidated revenues of $719.7 million, which was a 22.3% increase compared to the $588.5 million we reported for the second quarter of 2025. The increase in consolidated revenues was primarily due to the $130.4 million of revenues contributed by Purchasing Power, which we acquired on January 2, 2026. Additionally, revenues at Four increased by $19.0 million, compared to the prior year period, due to continued growth in its BNPL transactions. These increases were offset by a $19.8 million decrease in revenue at Progressive Leasing, which was driven primarily by a smaller gross leased asset balance throughout the second quarter of 2026 when compared to the same period in the prior year.

Current wording

•We reported consolidated revenues of $725.8 million, which was a 25.6% increase compared to the $577.7 million we reported for the third quarter of 2025. The increase in consolidated revenues was primarily due to the $131.8 million of revenues contributed by Purchasing Power, which we acquired on January 2, 2026. Additionally, revenues at Four increased by $19.8 million, compared to the prior year period, due to continued growth in its BNPL transactions. These increases were offset by a $3.9 million decrease in total revenues at Progressive Leasing, which was driven primarily by a smaller average gross leased asset balance during the third quarter of 2026 when compared to the same period in the prior year.

Previous wording

•GMV from Four increased by $165.5 million, due to an increase in Four loan originations in the second quarter of 2026 compared to the second quarter of 2025, as a result of the continued growth in that business. GMV increased by $14.2 million for Progressive Leasing in the second quarter of 2026, compared to the same period in the prior year. The increase in GMV for Progressive Leasing was due primarily to $23.0 million in GMV growth from e-commerce channels. This increase was offset by a reduction in GMV due to the higher cost of living experienced by our customer base, including increased fuel prices, and an uncertain macroeconomic outlook, all of which have negatively impacted consumer confidence and demand for our lease-to-own offering. GMV relating to Purchasing Power was $158.8 million and no GMV was reported in the prior year period, as the acquisition was completed on January 2, 2026.

Current wording

•GMV from Four increased by $167.3 million, due to an increase in Four loan originations in the third quarter of 2026 compared to the third quarter of 2025, as a result of the continued growth in that business. GMV increased by $9.5 million for Progressive Leasing in the third quarter of 2026, compared to the same period in the prior year. The increase in GMV for Progressive Leasing was due primarily to $16.7 million in GMV growth from e-commerce channels. This increase was partially offset by pressures on GMV due to the higher cost of living experienced by our customer base, including increased fuel prices, and an uncertain macroeconomic outlook, all of which have negatively impacted consumer confidence and demand for our lease-to-own offering. GMV relating to Purchasing Power was $161.2 million and no GMV was reported in the prior year period, as the acquisition was completed on January 2, 2026.

Previous wording

Progressive Leasing's GMV increased compared to the second quarter of 2025 due primarily to increases in GMV from e-commerce channels. E-commerce channels generated 25.6% of Progressive Leasing's GMV in the second quarter of 2026 compared to 20.9% in the second quarter of 2025. This increase was offset by a reduction in GMV driven by inflationary pressures, an elevated cost of living, and an uncertain macroeconomic outlook, all of which have negatively impacted consumer confidence and demand for our lease-to-own offering. The increase in Four's GMV is primarily attributable to the continued expansion of the Four BNPL platform, reflecting growth through higher transaction volumes and average order value from existing and new customers over the period.

Current wording

Progressive Leasing's GMV increased compared to the third quarter of 2025 due primarily to increases in GMV from e-commerce channels. E-commerce channels generated 26.4% of Progressive Leasing's GMV in the third quarter of 2026 compared to 23.0% in the third quarter of 2025. This increase was partially offset by a reduction in GMV driven by inflationary pressures, an elevated cost of living, and an uncertain macroeconomic outlook, all of which have negatively impacted consumer confidence and demand for our lease-to-own offering. The increase in Four's GMV is primarily attributable to the continued expansion of the Four BNPL platform, reflecting growth through higher transaction volumes and average order value from existing and new customers over the period.

Previous wording

The number of active customers for Progressive Leasing decreased due to a decrease in consumer demand for many of the durable leasable goods offered by our retail partners, due to the continued elevated costs of living and inflationary pressures facing our customers. The increase in the number of customers for Four was the result of continued growth in BNPL transactions, which have a significantly smaller transaction size, as compared to our Progressive Leasing business.

Current wording

The number of active customers for Progressive Leasing was relatively unchanged from the prior year. Increases from growth in our e-commerce channel were offset by decreases due to lower consumer demand for many of the durable leasable goods offered by our retail partners, due to the continued elevated costs of living and inflationary pressures facing our customers. The increase in the number of customers for Four was the result of continued growth in BNPL transactions, which have a significantly smaller transaction size, as compared to our Progressive Leasing business.

Previous wording

In this MD&A section, we discuss the key components of our condensed consolidated results. For the three and six months ended June 30, 2026 and the comparable prior year periods, some of the key revenue, cost and expense items that affected earnings before income taxes were as follows:

Current wording

In this MD&A section, we discuss the key components of our condensed consolidated results. For the three and nine months ended September 30, 2026 and the comparable prior year periods, some of the key revenue, cost and expense items that affected earnings before income taxes were as follows:

Previous wording

Revenues. We separate our total revenues into three components: (i) lease revenues and fees, (ii) product and service revenues and (iii) other revenues. Lease revenues and fees include all revenues derived from lease agreements from our Progressive Leasing segment. Lease revenues are recorded net of a provision for uncollectible renewal payments. Product and service revenues represent Purchasing Power's sales of products and the revenue earned relating to arranging for services that customers purchase from Purchasing Power, net of estimated returns. Other revenues represents transaction income, subscription revenues, annual and other fees earned relating to loans in our Four segment and our other strategic businesses, as well as Progressive Leasing affiliate commissions and imputed interest income recognized on a portion of Purchasing Power's receivables portfolio.

Current wording

Revenues. We separate our total revenues into three components: (i) lease revenues and fees, (ii) product and service revenues and (iii) other revenues. Lease revenues and fees include all revenues derived from lease agreements from our Progressive Leasing segment. Lease revenues are recorded net of a provision for uncollectible renewal payments. Product and service revenues represent Purchasing Power's sales of products and the revenue earned relating to arranging for services that customers purchase from Purchasing Power, net of estimated returns. Other revenues represent transaction income, subscription revenues, late and other fees earned relating to loans in our Four segment and our other strategic businesses, as well as Progressive Leasing affiliate commissions and imputed interest income recognized on a portion of Purchasing Power's receivables portfolio.

Previous wording

Provision for credit losses. The provision for credit losses reflects the expected lifetime credit losses on Purchasing Power's, Four's and other strategic operations receivables, determined using the Current Expected Credit Losses ("CECL") framework and incorporating historical loss experience, current conditions, and reasonable and supportable forecasts. The provision for credit losses on Purchasing Power's receivables are net of estimated recoveries from its program of selling portfolios of charged-off receivables to third-parties.

Current wording

Provision for credit losses. The provision for credit losses reflects the expected lifetime credit losses on Purchasing Power's, Four's and other strategic operations receivables, determined using the Current Expected Credit Losses ("CECL") framework and incorporating historical loss experience, current conditions, and reasonable and supportable forecasts. The provision for credit losses on Purchasing Power's receivables is net of estimated recoveries from its program of selling portfolios of charged-off receivables to third-parties.

Previous wording

The decrease in revenues was primarily due to a lower gross leased asset balance as a result of the tightening of our decisioning posture during 2025, and a decrease in demand for the durable leasable products offered by many of our retail partners. We believe the inflationary and other macroeconomic factors had a disproportionate negative effect on our customers' disposable income, negatively affecting demand for many products offered by our retail partners.

Current wording

The decrease in revenues was primarily due to a lower gross leased asset balance as a result of the tightening of our decisioning posture during early 2025 and again in 2026, and a decrease in demand for the durable leasable products offered by many of our retail partners. We believe the inflationary and other macroeconomic factors had a disproportionate negative effect on our customers' disposable income, negatively affecting demand for many products offered by our retail partners.

Previous wording

Gross margin is a key performance measure for our Progressive Leasing segment, which generates lease revenue from transactions that include associated depreciation of the merchandise on lease, making gross margin a meaningful indicator of profit. The increase in Progressive Leasing's gross margin percentage reflects a decline in customers' electing early purchase options, as macroeconomic conditions contributed to customers choosing to make payments over the full contractual lease term rather than exercising early purchase options, which generally result in lower margin realization.

Current wording

Gross margin is a key performance measure for our Progressive Leasing segment, which generates lease revenue from transactions that include associated depreciation of the merchandise on lease, making gross margin a meaningful indicator of profit. Gross margin percentage was essentially unchanged from the same period in the prior year.

Previous wording

The provision for lease merchandise write-offs increased $3.9 million compared to the same period in 2025. The provision for lease merchandise write-offs as a percentage of revenues increased to 8.4% during the second quarter of 2026 from 7.5% in the same period in 2025, primarily reflecting higher period-end delinquency levels, as well as continued pressure on customer payment performance in a challenging macroeconomic environment. Given the significant uncertainty regarding the impacts of geopolitical disruptions, inflation, tariffs, increased fuel prices, elevated interest rates, and unemployment rates on our business, and the potential effects of such developments on Progressive Leasing's POS partners, customers, and business going forward, a high level of estimation was involved in determining the allowance as of June 30, 2026. Actual lease merchandise write-offs could differ materially from the allowance for those write-offs.

Current wording

The provision for lease merchandise write-offs increased $4.9 million compared to the same period in 2025. The provision for lease merchandise write-offs as a percentage of revenues increased to 8.3% during the third quarter of 2026 from 7.4% in the same period in 2025, primarily reflecting higher period-end delinquency levels, as well as continued pressure on customer payment performance in a challenging macroeconomic environment. Given the significant uncertainty regarding the impacts of geopolitical disruptions, inflation, tariffs, increased fuel prices, elevated interest rates, and unemployment rates on our business, and the potential effects of such developments on Progressive Leasing's POS partners, customers, and business going forward, a high level of estimation was involved in determining the allowance as of September 30, 2026. Actual lease merchandise write-offs could differ materially from the allowance for those write-offs.

Previous wording

–Stock-based compensation increased$1.7 million, primarily due to (i) a higher aggregated fair value of restricted stock units granted during 2026 and (ii) higher expense recognized on performance stock units due to increased expected award achievement levels compared to the prior-year period.

Current wording

•Stock-based compensation increased$0.8 million, primarily due to (i) a higher aggregated fair value of restricted stock units granted during 2026 and (ii) higher expense recognized on performance share units due to increased expected award achievement levels compared to the prior-year period.

Previous wording

In June 2026, Progressive Leasing sold a portfolio of charged-off lease receivables to a third-party for $4.7 million in cash and recognized a gain of $4.7 million as the carrying amount of the charged-off receivables had been reduced to zero. There were no similar sales during the three months ended June 30, 2025.

Current wording

In August 2026, Progressive Leasing sold a portfolio of charged-off lease receivables to a third-party for $2.9 million in cash and recognized a gain of $2.9 million as the carrying amount of the charged-off receivables had been reduced to zero. There were no similar sales during the three months ended September 30, 2025.

Previous wording

Progressive Leasing results of operations – Six months ended June 30, 2026 and 2025

Current wording

Progressive Leasing results of operations – Nine months ended September 30, 2026 and 2025

Previous wording

The decrease in revenues was primarily due to a lower gross leased asset balance as a result of the tightening of our decisioning posture during 2025, and a decrease in demand for the durable leasable products offered by many of our retail partners. We believe the inflationary and other macroeconomic factors had a disproportionate negative effect on our customers' disposable income, negatively affecting demand for many products offered by our retail partners.

Current wording

The decrease in revenues was primarily due to a lower gross leased asset balance as a result of the tightening of our decisioning posture during 2025 and 2026, and a decrease in demand for the durable leasable products offered by many of our retail partners. We believe the inflationary and other macroeconomic factors had a disproportionate negative effect on our customers' disposable income, negatively affecting demand for many products offered by our retail partners.

Previous wording

Gross margin is a key performance measure for our Progressive Leasing segment, which generates lease revenue from transactions that include associated depreciation of the merchandise on lease, making gross margin a meaningful indicator of profit. The increase in Progressive Leasing's gross margin percentage reflects a decline in customers' electing early purchase options, as macroeconomic conditions contributed to customers choosing to make payments over the full contractual lease term rather than exercising early purchase options, which generally result in lower margin realization.

Current wording

The increase in Progressive Leasing's gross margin percentage reflects a decline in customers' electing early purchase options during the first half of 2026, as macroeconomic conditions contributed to customers choosing to make payments over the full contractual lease term rather than exercising early purchase options, which generally result in lower margin realization.

Previous wording

The provision for lease merchandise write-offs decreased $0.5 million compared to the same period in 2025. The provision for lease merchandise write-offs as a percentage of total revenues increased to 7.9% during the six months ended June 30, 2026 from 7.4% in the same period in 2025. The increase was due to a continued pressure on customer payment performance in a challenging macroeconomic environment. Given the significant uncertainty regarding the impacts of geopolitical disruptions, inflation, tariffs, higher fuel costs, elevated interest rates, and unemployment rates on our business, and the potential effects of such developments on Progressive Leasing's POS partners, customers, and business going forward, a high level of estimation was involved in determining the allowance as of June 30, 2026. Actual lease merchandise write-offs could differ materially from the allowance for those write-offs.

Current wording

The provision for lease merchandise write-offs increased $4.4 million compared to the same period in 2025. The provision for lease merchandise write-offs as a percentage of total revenues increased to 8.0% during the nine months ended September 30, 2026 from 7.4% in the same period in 2025. The increase was due to continued pressure on customer payment performance in a challenging macroeconomic environment. Given the significant uncertainty regarding the impacts of geopolitical disruptions, inflation, tariffs, higher fuel costs, elevated interest rates, and unemployment rates on our business, and the potential effects of such developments on Progressive Leasing's POS partners, customers, and business going forward, a high level of estimation was involved in determining the allowance as of September 30, 2026. Actual lease merchandise write-offs could differ materially from the allowance for those write-offs.

Previous wording

Selling, general and administrative expense increased primarily due to a$2.7 million increase in stock compensation expense, which wasprimarily due to (i) a higher aggregated fair value associated with restricted stock units granted during 2026 and (ii) higher expense recognized on performance stock units due to increased expected award achievement levels compared to the prior-year period.

Current wording

•Stock-based compensation increased $3.6 million primarily due to(i) a higher aggregated fair value associated with restricted stock units granted during 2026 and (ii) higher expense recognized on performance share units due to increased expected award achievement levels compared to the prior-year period.

Previous wording

In February and June 2026, Progressive Leasing sold portfolios of charged-off lease receivables to third-parties for a total of $11.2 million in cash and recognized total gains of $11.2 million, as the carrying amount of the charged-off receivables had been reduced to zero. There were no similar sales during the prior year.

Current wording

During the nine months ended September 30, 2026, Progressive Leasing sold portfolios of charged-off lease receivables to third-parties for a total of $14.0 million in cash and recognized total gains of $14.0 million, as the carrying amount of the charged-off receivables had been reduced to zero. There were no similar sales during the same period in the prior year.

Previous wording

Interest expense, net for the three months ended June 30, 2026 was higher than the same period in 2025 due to an increase in debt used for the acquisition of Purchasing Power on January 2, 2026.

Current wording

Interest expense, net for the nine months ended September 30, 2026 was higher than the same period in 2025 due to an increase in debt used for the acquisition of Purchasing Power on January 2, 2026, and a decrease in interest income due to lower average cash balances in 2026 compared to the prior year.

Previous wording

Selling, general and administrative expenses include $1.9 million of transaction and transition costs incurred related to the acquisition of Purchasing Power.

Current wording

Selling, general and administrative expenses include $0.4 million of transaction and transition costs incurred related to the acquisition of Purchasing Power.

Previous wording

The gain on change in fair value of receivables of $1.8 million reflects changes in the estimated fair value of Purchasing Power's receivables under the fair value option, including the impact of the passage of time, changes in credit performance, discount rates and other valuation inputs.

Current wording

The gain on change in fair value of receivables of $1.5 million reflects changes in the estimated fair value of Purchasing Power's receivables under the fair value option, including the impact of the passage of time, changes in credit performance, discount rates and other valuation inputs.

Previous wording

Purchasing Power results of operations – Six months ended June 30, 2026 and 2025

Current wording

Purchasing Power results of operations – Nine months ended September 30, 2026 and 2025

Previous wording

Selling, general and administrative expenses include $3.7 million of transaction and transition costs incurred related to the acquisition of Purchasing Power.

Current wording

Selling, general and administrative expenses include $4.0 million of transaction and transition costs incurred related to the acquisition of Purchasing Power.

Previous wording

Other expenses include restructuring expense related to employee severance of $3.4 million resulting from cost reduction initiatives that occurred shortly after the Company's acquisition of Purchasing Power.

Current wording

Restructuring and other expenses represent employee severance of $4.2 million resulting from cost reduction initiatives that occurred shortly after the Company's acquisition of Purchasing Power.

Previous wording

The gain on change in fair value of receivables of $7.5 million reflects changes in the estimated fair value of Purchasing Power's receivables under the fair value option, including the impact of the passage of time, changes in credit performance, discount rates and other valuation inputs.

Current wording

The gain on change in fair value of receivables of $9.0 million reflects changes in the estimated fair value of Purchasing Power's receivables under the fair value option, including the impact of the passage of time, changes in credit performance, discount rates and other valuation inputs.

Previous wording

Provision for credit losses increased due to the growth in new BNPL transactions. The increase in the provision for credit losses is consistent with the increase in GMV for the six months ended June 30, 2026 when compared to the same period in the prior year.

Current wording

Provision for credit losses increased due to the growth in new BNPL transactions. The provision as a percentage of revenues has improved for the three months ended September 30, 2026 when compared to the same period in the prior year due to management's continued refinement of its credit risk models, as well as continued growth in Four+ subscription revenues, which does not result in outstanding receivables or provision for credit losses.

Previous wording

–Bank charges and processing fees increased $4.4 million related to higher customer payment transaction volumes; and

Current wording

•Bank charges and processing fees increased $4.1 million related to higher customer payment transaction volumes; and

Previous wording

–Advertising expense increased $1.6 million resulting from additional marketing efforts to drive continued growth of Four.

Current wording

•Advertising expense increased $1.3 million resulting from additional marketing efforts to drive continued growth of Four.

Previous wording

Provision for credit losses increased due to the growth in new BNPL transactions. The increase in the provision for credit losses is consistent with the increase in GMV for the quarter ended June 30, 2026 when compared to the same period in the prior year.

Current wording

Provision for credit losses increased due to the growth in new BNPL transactions. The provision as a percentage of revenues has improved for the nine months ended September 30, 2026 when compared to the same period in the prior year due to management's continued refinement of its credit risk models, as well as continued growth in Four+ subscription revenues, which does not result in outstanding receivables or provision for credit losses.

Previous wording

–Bank charges and processing fees increased $9.3 million related to higher customer payment transaction volumes; and

Current wording

•Bank charges and processing fees increased $13.4 million related to higher customer payment transaction volumes; and

Previous wording

–Advertising expense increased $3.0 million resulting from additional marketing efforts to drive continued growth of Four.

Current wording

•Advertising expense increased $4.3 million resulting from additional marketing efforts to drive continued growth of Four.

Previous wording

Other operations incurred$1.4 million of losses before income tax expense for thethree months ended June 30, 2026, which is primarily related to losses associated with our other strategic operations.

Current wording

Other operations incurred$1.5 million of losses before income tax expense for thethree months ended September 30, 2026, which is primarily related to losses associated with our other strategic operations.

Previous wording

Other operations incurred$9.7 million of losses before income tax expense for thesix months ended June 30, 2026, which was primarily related to costs incurred in connection with the acquisition of Purchasing Power on January 2, 2026.

Current wording

Other operations incurred$11.1 million of losses before income tax expense for thenine months ended September 30, 2026, which was primarily related to costs incurred in connection with the acquisition of Purchasing Power on January 2, 2026.