OppFi Inc

Previous wording

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION

Current wording

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Previous wording

OppFi’s primary products are offered by its OppLoans platform. Customers on this platform are U.S. consumers who are employed, have bank accounts, and generally earn median wages. The average installment loan facilitated by OppFi is approximately $1,500, payable in installments and with an average contractual term of 11 months. Neither SalaryTap nor OppFi Card contributed meaningfully to OppFi’s results during the three months ended June 30, 2024.

Current wording

OppFi’s primary products are offered by its OppLoans platform. Customers on this platform are U.S. consumers who are employed, have bank accounts, and generally earn median wages. The average installment loan facilitated by OppFi is approximately $1,500, payable in installments and with an average contractual term of 11 months. Neither SalaryTap nor OppFi Card contributed meaningfully to OppFi’s results during the three and nine months ended September 30, 2024.

Previous wording

•Basic and diluted earnings per share (“EPS”)of $0.16 and $0.16, respectively, for thethree months ended June 30, 2024;

Current wording

•Basic and diluted earnings per share (“EPS”) of $0.21 and $0.21, respectively, for the three months ended September 30, 2024;

Previous wording

•Adjusted earnings per share (“Adjusted EPS”)(1) of $0.29 for thethree months ended June 30, 2024, an increase of$0.10 from $0.19 for the three months ended June 30, 2023;

Current wording

•Adjusted earnings per share (“Adjusted EPS”)(1) of $0.33 for the three months ended September 30, 2024, an increase of $0.18 from $0.16 for the three months ended September 30, 2023;

Previous wording

•Adjusted net income (“Adjusted Net Income”)(1) of $24.8 million for the three months ended June 30, 2024, an increase of $8.9 million from $15.9 million for the three months ended June 30, 2023.

Current wording

•Adjusted net income (“Adjusted Net Income”)(1) of $28.8 million for the three months ended September 30, 2024, an increase of $15.5 million from $13.3 million for the three months ended September 30, 2023.

Previous wording

On April 4, 2024, the Board authorized a new share repurchase program to repurchase up to $20.0 million in the aggregate of shares of our Class A Common Stock. This new share repurchase program will expire in April 2027. During the three months ended June 30, 2024, we repurchased 769,715 shares of Class A Common Stock, which were held as treasury stock as of June 30, 2024, for an aggregate purchase price of $2.5 million at an average purchase price per share of $3.27. As of June 30, 2024, $17.5 million of the repurchase authorization under the Repurchase Program remained available.

Current wording

On April 4, 2024, the Board authorized a new share repurchase program to repurchase up to $20.0 million in the aggregate of shares of our Class A Common Stock. This new share repurchase program will expire in April 2027. During the three months ended September 30, 2024, OppFi repurchased 264,995 shares of Class A Common Stock, which were held as treasury stock as of September 30, 2024, for an aggregate purchase price of $1.0 million at an average purchase price per share of $3.82. During the nine months ended September 30, 2024, the Company repurchased 1,034,710 shares of Class A Common Stock, which were held as treasury stock as of September 30, 2024, for an aggregate purchase price of $3.6 million at an average purchase price per share of $3.41. As of September 30, 2024, $16.4 million of the repurchase authorization under the Repurchase Program remained available.

Previous wording

On July 31, 2024, we entered into a Securities Purchase Agreement, dated as of July 31, 2024, to acquire 35% of the outstanding equity securities of Bitty Holdings, LLC (“Bitty”), a credit access company that offers revenue-based financing and other working capital solutions. The acquisition closed on July 31, 2024 (the “Closing Date”). The aggregate consideration paid in connection with the acquisition consisted of (i) a cash payment of approximately $15.3 million and (ii) 734,851 OppFi Units, valued at approximately $2.7 million.

Current wording

On July 31, 2024, we entered into a Securities Purchase Agreement, dated as of July 31, 2024 (the “Securities Purchase Agreement”), to acquire 35% of the outstanding equity securities of Bitty, a credit access company that offers revenue-based financing and other working capital solutions. The acquisition closed on July 31,2024 (the “Acquisition Date”). The aggregate consideration paid in connection with the acquisition consisted of (i) a cash payment of approximately $15.3 million and (ii) 734,851 OppFi Units, valued at approximately $2.7 million.

Previous wording

Pursuant to the Securities Purchase Agreement, one of our subsidiaries has (a) the right to purchase an additional 30% of the outstanding equity securities of Bitty within a specific time period from the date that is three years from the Closing Date, and (b) the right to purchase all remaining equity securities of Bitty within a specific time period from the date that is six years from the Closing Date.

Current wording

Pursuant to the Securities Purchase Agreement, one of our subsidiaries has (a) the right to purchase an additional 30% of the outstanding equity securities of Bitty within a specific time period from the date that is three years from the Acquisition Date, and (b) the right to purchase all of the remaining equity securities of Bitty within a specific time period from the date that is six years from the Acquisition Date.

Previous wording

For further details, see Note 17 to the Consolidated Financial Statements, “Subsequent Events”.

Current wording

For further details, see Note 2 to the Consolidated Financial Statements, “Significant Accounting Policies.”

Previous wording

We regularly review the following key metrics to evaluate our business, measure our performance, identify trends affecting our business, formulate financial projections and make strategic decisions, which may also be useful to an investor. The following tables and related discussion set forth key financial and operating metrics for the Company’s operations as of and for the three and six months ended June 30, 2024 and 2023.

Current wording

We regularly review the following key metrics to evaluate our business, measure our performance, identify trends affecting our business, formulate financial projections, and make strategic decisions, which may also be useful to an investor. The following tables and related discussion set forth key financial and operating metrics for the Company’s operations as of and for the three and nine months ended September 30, 2024 and 2023.

Previous wording

The following tables present total net originations (defined as gross originations net of transferred balance on refinanced loans), total retained net originations (defined as the portion of total net originations as defined above with respect to which the Company ultimately purchased a receivable from bank partners or originated directly), percentage of net originations by bank partners, and percentage of net originations by new loans for the three and six months ended June 30, 2024 and 2023 (in thousands):

Current wording

The following tables present total net originations (defined as gross originations net of transferred balance on refinanced loans), total retained net originations (defined as the portion of total net originations as defined above with respect to which the Company ultimately purchased a receivable from bank partners or originated directly), percentage of net originations by bank partners, and percentage of net originations by new loans for the three and nine months ended September 30, 2024 and 2023 (in thousands):

Previous wording

Total net originations increased to $205.5 million and $369.0 million for the three and six months ended June 30, 2024, respectively, from $200.6 million and $360.2 million for the three and six months ended June 30, 2023, respectively. The 2.4% and 2.4% increases for the three and six months ended June 30, 2024 were a result of bank partners’ expansion into additional states as well as enhanced lead evaluation capabilities driving higher quality applications. Total retained net originations decreased to $189.3 million and $341.9 million for the three and six months ended June 30, 2024, respectively, from $195.3 million and $351.0 million for the three and six months ended June 30, 2023, respectively. The 3.1% and 2.6% decreases for the three and six months ended June 30, 2024 were attributed to one of our bank partners retaining a higher percentage of loans originated in certain states.

Current wording

Total net originations increased to $218.8 million and $587.8 million for the three and nine months ended September 30, 2024, respectively, from $195.7 million and $555.9 million for the three and nine months ended September 30, 2023, respectively. The 11.8% and 5.7% increases for the three and nine months ended September 30, 2024 were a result of bank partners’ expansion into additional states, increased demand through certain marketing partners, and enhanced lead evaluation capabilities driving higher quality applications. Total retained net originations increased to $198.4 million and decreased to $540.3 million for the three and nine months ended September 30, 2024, respectively, from $190.7 million and $541.7 million for the three and nine months ended September 30, 2023, respectively. The 4.0% increase for the three months ended September 30, 2024 was a result of the originations growth outpacing the growth in the percentage of loans retained by our bank partners, while the 0.3% decrease for the nine months ended September 30, 2024 was attributed to one of our bank partners retaining a higher percentage of loans originated in certain states.

Previous wording

Total net originations by our bank partners increased to 100.0% and 100.0% for the three and six months ended June 30, 2024, respectively, from 97.3% and 96.4% for the three and six months ended June 30, 2023, respectively. During the third quarter of 2023, the Company ceased directly originating loans and transitioned completely to a servicing / facilitation model for bank partners.

Current wording

Total net originations by our bank partners increased to 100.0% and 100.0% for the three and nine months ended September 30, 2024, respectively, from 97.9% and 96.9% for the three and nine months ended September 30, 2023, respectively. During the third quarter of 2023, the Company ceased directly originating loans and transitioned completely to a servicing / facilitation model for bank partners.

Previous wording

Ending receivables decreased to $387.1 million as of June 30, 2024 from $397.8 million as of June 30, 2023. The 2.7% decrease was primarily driven by a one of our bank partners retaining a higher percentage of loans originated in certain states.

Current wording

Ending receivables decreased to $413.7 million as of September 30, 2024 from $415.9 million as of September 30, 2023. The 0.5% decrease was primarily driven by one of our bank partners retaining a higher percentage of loans originated in certain states.

Previous wording

Average yield represents total revenue from the period as a percent of average receivables and is presented as an annualized metric. Receivables are defined as the unpaid principal balances of loans. The following tables present average yield for the three and six months ended June 30, 2024 and 2023:

Current wording

Average yield represents total revenue from the period as a percent of average receivables and is presented as an annualized metric. Receivables are defined as the unpaid principal balances of loans. The following tables present average yield for the three and nine months ended September 30, 2024 and 2023:

Previous wording

Average yield increased to 134.8% and 131.4% for the three and six months ended June 30, 2024, respectively, from 128.8% and 126.7% for the three and six months ended June 30, 2023, respectively. The 4.7% and 3.7% increases were driven by a decrease in delinquent loans in the portfolio that were not accruing interest throughout the period as well as an increase in the average statutory rate from a relative shift away from states with lower interest rates.

Current wording

Average yield increased to 133.9% and 131.8% for the three and nine months ended September 30, 2024, respectively, from 128.5% and 127.3% for the three and nine months ended September 30, 2023, respectively. The 4.2% and 3.5% increases were driven by a decrease in delinquent loans in the portfolio that were not accruing interest throughout the period as well as an increase in the average statutory rate from a relative shift away from states with lower interest rates.

Previous wording

Net charge-offs as a percentage of total revenue and net charge-offs as a percentage of average receivables represent total charge-offs from the period less recoveries as a percentage of total revenue and as a percentage of average receivables. Net charge-offs as a percentage of average receivables is presented as an annualized metric. Receivables are defined as the unpaid principal of loans. Our charge-off policy is based on a review of delinquent finance receivables on a loan-by-loan basis. Finance receivables are charged off at the earlier of the time when accounts reach 90 days past due on a recency basis, when we receive notification of a customer bankruptcy, or when finance receivables are otherwise deemed uncollectible.

Current wording

Net charge-offs as a percentage of total revenue and net charge-offs as a percentage of average receivables represent total charge-offs from the period less recoveries as a percentage of total revenue and as a percentage of average receivables. Net charge-offs as a percentage of average receivables is presented as an annualized metric. Receivables are defined as the unpaid principal balances of loans. Our charge-off policy is based on a review of delinquent finance receivables on a loan-by-loan basis. Finance receivables are charged off at the earlier of the time when accounts reach 90 days past due on a recency basis, when we receive notification of a customer bankruptcy, or when finance receivables are otherwise deemed uncollectible.

Previous wording

The following tables present net charge-offs as a percentage of total revenue and as an annualized percentage of average receivables for the three and six months ended June 30, 2024 and 2023:

Current wording

The following tables present net charge-offs as a percentage of total revenue and as an annualized percentage of average receivables for the three and nine months ended September 30, 2024 and 2023:

Previous wording

Net charge-offs as a percentage of total revenue decreased to 32.5% and 40.2% for the three and six months ended June 30, 2024, respectively, from 36.2% and 42.6% for the three and six months ended June 30, 2023, respectively. The decreases in net charge-offs as a percentage of total revenue for the three and six months ended June 30, 2024 are a result of a higher yielding portfolio for the reasons discussed above in “Average Yield” combined with higher recoveries driving lower levels of net charge-offs compared to the three and six months ended June 30, 2023. Net charge-offs as a percentage of average receivables decreased to 43.8% and 52.9% for the three and six months ended June 30, 2024, respectively, from 46.6% and 53.9% for the three and six months ended June 30, 2023, respectively. The decreases in net charge-offs as a percentage of average receivables for the three and six months ended June 30, 2024 are a result of higher recoveries driving lower levels of net charge-offs compared to the three and six months ended June 30, 2023.

Current wording

Net charge-offs as a percentage of total revenue decreased to 34.3% and 38.2% for the three and nine months ended September 30, 2024, respectively, from 42.4% and 42.5% for the three and nine months ended September 30, 2023, respectively. The decreases in net charge-offs as a percentage of total revenue for the three and nine months ended September 30, 2024 are a result of a higher yielding portfolio for the reasons discussed above in “Average Yield” combined with both lower gross charge-offs and higher recoveries driving lower levels of net charge-offs compared to the three and nine months ended September 30, 2023. Net charge-offs as a percentage of average receivables decreased to 45.9% and 50.3% for the three and nine months ended September 30, 2024, respectively, from 54.5% and 54.1% for the three and nine months ended September 30, 2023, respectively. The decreases in net charge-offs as a percentage of average receivables for the three and nine months ended September 30, 2024 are a result of both lower gross charge-offs and higher recoveries driving lower levels of net charge-offs compared to the three and nine months ended September 30, 2023.

Previous wording

Auto-approval rate is calculated by taking the number of approved loans that are not decisioned by a loan processor or underwriter (auto-approval) divided by the total number of loans approved. The following tables present auto approval rate for the three and six months ended June 30, 2024 and 2023:

Current wording

Auto-approval rate is calculated by taking the number of approved loans that are not decisioned by a loan processor or underwriter (auto-approval) divided by the total number of loans approved. The following tables present auto approval rate for the three and nine months ended September 30, 2024 and 2023:

Previous wording

Auto-approval rate increased to 75.8% and 74.7% for the three and six months ended June 30, 2024, respectively, from 72.1% and 71.0% for the three and six months ended June 30, 2023, respectively. The increases in auto-approval rate for the three and six months ended June 30, 2024 were driven by the continued application of algorithmic automation projects that streamline frictional steps of the origination process.

Current wording

Auto-approval rate increased to 76.8% and 75.4% for the three and nine months ended September 30, 2024, respectively, from 72.5% and 71.5% for the three and nine months ended September 30, 2023, respectively. The increases in auto-approval rate for the three and nine months ended September 30, 2024 were driven by the continued application of algorithmic automation projects that streamline frictional steps of the origination process.

Previous wording

The following table presents our consolidated results of operations for the three months ended June 30, 2024 and 2023 (in thousands, except number of shares and per share data).

Current wording

The following table presents our consolidated results of operations for the three months ended September 30, 2024 and 2023 (in thousands, except share and per share data). Certain columns and rows may not sum due to the use of rounded numbers for disclosure purposes. Percentages presented are calculated from the underlying whole-dollar amounts.

Previous wording

Total revenue consists mainly of revenue earned from interest on receivables from outstanding loans based on the interest method. We also earn revenue from referral fees related primarily to our “Turn-Up” program, which represented 0.3% of total revenue for the three months ended June 30, 2024.

Current wording

Total revenue consists mainly of revenue earned from interest on receivables from outstanding loans based on the interest method. We also earn revenue from referral fees related primarily to our “Turn-Up” program, which represented 0.2% of total revenue for the three months ended September 30, 2024.

Previous wording

Total revenue increased by $3.8 million, or 3.1%, to $126.3 million for the three months ended June 30, 2024 from $122.5 million for the three months ended June 30, 2023. The increase was due to a higher average statutory rate for the loans in the portfolio as well as stronger payment activity driving a higher yield on the balances.

Current wording

Total revenue increased by $3.4 million, or 2.6%, to $136.6 million for the three months ended September 30, 2024 from $133.2 million for the three months ended September 30, 2023. The increase was due to a higher average statutory rate for the loans in the portfolio as well as stronger payment activity driving a higher yield on the balances.

Previous wording

Change in fair value consists of gross charge-offs incurred in the period on the OppLoans installment product, net of recoveries, plus the change in the fair value on the installment loans portfolio. Change in fair value totaled $40.0 million for the three months ended June 30, 2024, which was comprised of $41.1 million of net charge-offs and a fair market value adjustment of $(1.1) million, down from $44.0 million for the three months ended June 30, 2023, which was comprised of $44.2 million of net charge-offs and a fair market value adjustment of $(0.2) million. The fair value adjustment for thethree months ended June 30, 2024 had a positive impact due to the increase in receivables over the period with a relatively flat fair value mark.

Current wording

Change in fair value consists of gross charge-offs incurred in the period on the OppLoans installment product, net of recoveries, plus the change in the fair value on the installment loans portfolio. Change in fair value totaled $45.4 million for the three months ended September 30, 2024, which was comprised of $55.6 million of gross charge-offs, offset by $8.8 million of recoveries and a positive fair value adjustment of $1.4 million, down from $57.3 million for the three months ended September 30, 2023, which was comprised of $62.6 million of gross charge-offs and a negative fair value adjustment of $1.0 million, offset by $6.3 million of recoveries. The fair value adjustment for thethree months ended September 30, 2024 had a positive impact due to the increase in receivables over the period with a relatively flat fair value mark.

Previous wording

Provision for credit losses on finance receivables consists of gross charge-offs incurred in the period, net of recoveries, plus the change in allowance for credit losses for our SalaryTap and OppFi Card products. Provision for credit losses on finance receivables decreased by $3.9 million to $30.8 thousand for the six months ended June 30, 2024 from $3.9 million for the six months ended June 30, 2023. The decrease is largely attributed to very few remaining active SalaryTap finance receivables during the six months ended June 30, 2024, while provision for credit losses was increased during six months ended June 30, 2023 to account for the then-impending closure of OppFi Card finance receivables.

Current wording

Provision for credit losses on finance receivables consists of gross charge-offs incurred in the period, net of recoveries, plus the change in allowance for credit losses for our SalaryTap and OppFi Card products. Provision for credit losses on finance receivables decreased by $192 thousand to $3 thousand for the three months ended September 30, 2024 from $0.2 million for the three months ended September 30, 2023. The decrease is largely attributed to very few remaining active SalaryTap finance receivables during the three months ended September 30, 2024.

Previous wording

Net revenue is equal to total revenue less the change in fair value and provision for credit losses on finance receivables. Total net revenue increased by $11.7 million, or 15.7%, to $86.3 million for the three months ended June 30, 2024 from $74.6 million for the three months ended June 30, 2023. This increase was due to both the increase in total revenue and the decrease in change in fair value and provision for credit losses on finance receivables.

Current wording

Net revenue is equal to total revenue less the change in fair value and provision for credit losses on finance receivables. Net revenue increased by $15.5 million, or 20.5%, to $91.2 million for the three months ended September 30, 2024 from $75.7 million for the three months ended September 30, 2023. This increase was due to both the increase in total revenue and the decrease in change in fair value and provision for credit losses on finance receivables.

Previous wording

Expenses increased by $0.6 million, or 1.0%, to $56.8 million for the three months ended June 30, 2024, from $56.2 million for the three months ended June 30, 2023. The increase in expenses was primarily driven by a one-time adjustment as a result of the reclassification of OppFi Card assets from held for sale to held for investment at amortized cost that offset expenses for the three months ended June 30, 2023. The increase was partially offset by lower direct marketing spend expense resulting from a shift towards relatively lower-cost loans, reduced payment processing fees related to a renegotiation, and lower professional fees related to accounting and legal matters. Despite the slight increase in total expenses for the three months ended June 30, 2024, expenses as a percent of total revenue decreased from 45.9% to 45.0% for the three months ended June 30, 2024 compared to the three months ended June 30, 2023.

Current wording

Expenses decreased by $4.0 million, or 6.7%, to $56.1 million for the three months ended September 30, 2024, from $60.1 million for the three months ended September 30, 2023. The decrease in expenses was primarily driven by reduced payment processing fees related to a renegotiation, lower salary expenses from headcount efficiency, and lower capitalized technology amortization expense. The decrease was partially offset by higher professional fees. Expenses as a percent of total revenue decreased from 45.1% to 41.1% for the three months ended September 30, 2024 compared to the three months ended September 30, 2023.

Previous wording

Income from operations is the difference between net revenue and expenses. Total income from operations increased by $12.7 million to $34.8 million for the six months ended June 30, 2024 from income from operations of $22.1 million for the six months ended June 30, 2023. This increase was driven primarily by higher total revenue and lower change in fair value and provision for credit losses on finance receivables, slightly offset by higher expenses for the six months ended June 30, 2024 as a result of the reasons discussed above.

Current wording

Income from operations is the difference between net revenue and expenses. Income from operations increased by $19.5 million to $35.1 million for the three months ended September 30, 2024 from income from operations of $15.6 million for the three months ended September 30, 2023. This increase was driven by higher total revenue, lower change in fair value and provision for credit losses on finance receivables, and lower expenses for the three months ended September 30, 2024 as a result of the reasons stated above.

Previous wording

Change in fair value of warrant liabilities totaled $(1.0) million for the three months ended June 30, 2024 and $0.4 million for the three months ended June 30, 2023. These warrant liabilities arose with respect to warrants issued in connection with the initial public offering of FGNA and are subject to re-measurement at each balance sheet date.

Current wording

The fair value of warrant liabilities increased by $1.4 million for the three months ended September 30, 2024 and decreased by $0.3 million for the three months ended September 30, 2023. These warrant liabilities arose with respect to warrants issued in connection with the initial public offering of FGNA and are subject to re-measurement at each balance sheet date.

Previous wording

Income before income taxes is the sum of income from operations, the change in fair value of warrant liabilities, and other income. Income before income taxes increased by $9.8 million, or 52.4%, to $28.6 million for the three months ended June 30, 2024 from $18.8 million for the three months ended June 30, 2023 for the reasons stated above.

Current wording

Income before income taxes is the sum of income from operations, the change in fair value of warrant liabilities, income from equity method investment, and other income. Income before income taxes increased by $18.4 million, or 114.8%, to $34.4 million for the three months ended September 30, 2024 from $16.0 million for the three months ended September 30, 2023 for the reasons stated above.

Previous wording

OppFi recorded an income tax expense of $0.9 million for the three months ended June 30, 2024 and $0.7 million for the three months ended June 30, 2023. This increase is largely attributed to OppFi Inc.’s increasing ownership in OppFi-LLC.

Current wording

OppFi recorded an income tax expense of $2.3 million for the three months ended September 30, 2024 and $0.5 million for the three months ended September 30, 2023. This increase is largely attributed to OppFi Inc.’s increasing ownership in OppFi-LLC.

Previous wording

Net income increased by $9.6 million to $27.7 million for the three months ended June 30, 2024 from net income of $18.1 million for the three months ended June 30, 2023 for the reasons stated above.

Current wording

Net income is the difference between income before income taxes and income tax expense. Net income increased by $16.5 million to $32.1 million for the three months ended September 30, 2024 from net income of $15.5 million for the three months ended September 30, 2023 for the reasons stated above.

Previous wording

Net income attributable to OppFi Inc. was $3.1 million for the three months ended June 30, 2024, up from net income attributable to OppFi Inc. of $2.1 million for the three months ended June 30, 2023. Net income attributable to OppFi Inc. represents the income solely attributable to stockholders of OppFi Inc. As a result of the Company’s Up-C structure, the underlying income or expense components that are attributable to OppFi Inc. are generally expense items related to OppFi Inc.’s status as a public company, the income or expense for the change in fair value of warrant liabilities related to the Company’s warrants, and the Company’s approximate percentage interest in the noncontrolling interest. For the three months ended June 30, 2024, the underlying income or expense components attributable to OppFi Inc. include OppFi Inc.'s percentage interest in the income attributable to noncontrolling interest of $5.3 million, partially offset by the loss on change in fair value of warrant liabilities of $1.0 million, income tax expense of $0.9 million, general and administrative expense of $0.2 million, and board fees of $0.1 million, for total net income attributable to OppFi Inc. of $3.1 million. For the three months ended June 30, 2023, the underlying income or expense components that are attributable to OppFi Inc. include OppFi Inc.’s percentage interest in the income attributable to noncontrolling interest of $2.6 million and the gain on change in fair value of warrant liabilities of $0.3 million, partially offset by income tax expense of $0.6 million, general and administrative expense of $0.1 million, and board fees of $0.1 million, for net income attributable to OppFi Inc. of $2.1 million.

Current wording

Net income attributable to OppFi Inc. was $4.3 million for the three months ended September 30, 2024, up from net income attributable to OppFi Inc. of $2.2 million for the three months ended September 30, 2023. Net income attributable to OppFi Inc. represents the income solely attributable to stockholders of OppFi Inc. As a result of the Company’s Up-C structure, the underlying income or expense components that are attributable to OppFi Inc. are generally expense items related to OppFi Inc.’s status as a public company, the income or expense for the change in fair value of warrant liabilities related to the Company’s warrants, and the Company’s approximate percentage interest in the noncontrolling interest. For the three months ended September 30, 2024, the underlying income or expense components attributable to OppFi Inc. include OppFi Inc.'s percentage interest in the income attributable to noncontrolling interest of $8.7 million, partially offset by the loss on change in fair value of warrant liabilities of $1.4 million, income tax expense of $2.3 million, general and administrative expense of $0.6 million, and board fees of $0.1 million, for total net income attributable to OppFi Inc. of $4.3 million. For the three months ended September 30, 2023, the underlying income or expense components that are attributable to OppFi Inc. include OppFi Inc.’s percentage interest in the income attributable to noncontrolling interest of $2.4 million and the gain on change in fair value of warrant liabilities of $0.3 million, partially offset by income tax expense of $0.4 million and general and administrative expense and board fees of $0.1 million, for net income attributable to OppFi Inc. of $2.2 million.

Previous wording

For the six months ended June 30, 2024, the Company’s outstanding shares of Class V Voting Stock were included in computing the diluted earnings per share as the inclusion of these shares had a dilutive effect under the if-converted method. Under the if-converted method, shares of the Company’s Class V Voting Stock are assumed to be exchanged, together with OppFi Units, into shares of the Company’s Class A Common Stock as of the beginning of the period. For the six months ended June 30, 2023, the Company’s outstanding shares of Class V Voting Stock were excluded in computing the diluted earnings per share as the inclusion of these shares would have had an antidilutive effect under the if-converted method.

Current wording

For the three months ended September 30, 2024 and 2023, the Company’s outstanding shares of Class V Voting Stock were excluded in computing the diluted earnings per share as the inclusion of these shares would have had an antidilutive effect under the if-converted method. Under the if-converted method, shares of the Company’s Class V Voting Stock are assumed to be exchanged, together with OppFi Units, into shares of the Company’s Class A Common Stock as of the beginning of the period.

Previous wording

The following table presents our consolidated results of operations for the six months ended June 30, 2024 and 2023 (in thousands, except number of shares and per share data).

Current wording

The following table presents our consolidated results of operations for the nine months ended September 30, 2024 and 2023 (in thousands, except share and per share data). Certain columns and rows may not sum due to the use of rounded numbers for disclosure purposes. Percentages presented are calculated from the underlying whole-dollar amounts.

Previous wording

Total revenue consists mainly of revenue earned from interest on receivables from outstanding loans based on the interest method. We also earn revenue from referral fees related primarily to our “Turn-Up” program, which represented 0.2% of total revenue for the six months ended June 30, 2024.

Current wording

Total revenue consists mainly of revenue earned from interest on receivables from outstanding loans based on the interest method. We also earn revenue from referral fees related primarily to our “Turn-Up” program, which represented 0.2% of total revenue for the nine months ended September 30, 2024.

Previous wording

Total revenue increased by $10.8 million, or 4.4%, to $253.6 million for the six months ended June 30, 2024 from $242.9 million for the six months ended June 30, 2023. The increase was due to higher average receivables balances throughout the period, a higher average statutory rate for the loans in the portfolio, and stronger payment activity driving a higher yield on the balances.

Current wording

Total revenue increased by $14.2 million, or 3.8%, to $390.2 million for the nine months ended September 30, 2024 from $376.0 million for the nine months ended September 30, 2023. The increase was due to higher average receivables balances throughout the period, a higher average statutory rate for the loans in the portfolio, and stronger payment activity driving a higher yield on the balances.

Previous wording

Change in fair value consists of gross charge-offs incurred in the period on the OppLoans installment product, net of recoveries, plus the change in the fair value on the installment loans portfolio. Change in fair value totaled $104.1 million for the six months ended June 30, 2024, which was comprised of $102.1 million of net charge-offs and a fair market value adjustment of $2.1 million, down from $107.2 million for the six months ended June 30, 2023, which was comprised of $103.0 million of net charge-offs and a fair market value adjustment of $4.2 million. The fair value adjustment for the six months ended June 30, 2024 had a negative impactdue to the decrease in receivables over the period with a relatively flat fair value mark.

Current wording

Change in fair value consists of gross charge-offs incurred in the period on the OppLoans installment product, net of recoveries, plus the change in the fair value on the installment loans portfolio. Change in fair value totaled $149.5 million for the nine months ended September 30, 2024, which was comprised of $174.6 million of gross charge-offs and a negative fair value adjustment of $0.7 million, offset by $25.8 of recoveries, down from $164.5 million for the nine months ended September 30, 2023, which was comprised of $178.5 million of gross charge-offs and a negative fair value adjustment of $5.2 million, offset by $19.2 million of recoveries. The fair value adjustment for the nine months ended September 30, 2024 had a negative impactdue to the decrease in receivables over the period with a relatively flat fair value mark.

Previous wording

Provision for credit losses on finance receivables consists of gross charge-offs incurred in the period, net of recoveries, plus the change in allowance for credit losses for our SalaryTap and OppFi Card products. Provision for credit losses on finance receivables decreased by $3.9 million to $4.1 thousand for the three months ended June 30, 2024 from $3.9 million for the three months ended June 30, 2023. The decrease is largely attributed to very few remaining active SalaryTap finance receivables during the three months ended June 30, 2024, while provision for credit losses was increased during the three months ended June 30, 2023 to account for the then-impending closure of OppFi Card finance receivables.

Current wording

Provision for credit losses on finance receivables consists of gross charge-offs incurred in the period, net of recoveries, plus the change in allowance for credit losses for our SalaryTap and OppFi Card products. Provision for credit losses on finance receivables decreased by $4.1 million to $34 thousand for the nine months ended September 30, 2024 from $4.1 million for the nine months ended September 30, 2023. The decrease is largely attributed to very few remaining active SalaryTap finance receivables during the nine months ended September 30, 2024, while provision for credit losses was increased during nine months ended September 30, 2023 to account for the then-impending closure of OppFi Card finance receivables.