OPRT - Earnings call transcript Q4 2023 | Oportun Financial Corporation

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Operator

Welcome to Oportun's Financial Corporation's Fourth Quarter 2023 Earnings Conference Call. [Operator Instructions] Today's call is being recorded.

For opening remarks and introductions, I'd like to turn the call over to Dorian Hare, Senior Vice President of Investor Relations. Mr. Hare, you may begin.

Dorian Hare

everyone. hello, and Thanks discuss Executive quarter Chief Officer Administrative and to Raul Financial results Vazquez, Chief Chief and Officer. Oportun's me XXXX fourth are Officer With Jonathan Coblentz, operations.Actual on regarding include forward-looking we expense services, related of some senior may everyone I'll operations secured by webcast results and business, business savings statements call plan, and loan from made statements. will for contemplated differ undue results our not future remarks strategy, those plans and financial materially to forward-looking place management those that position our objectives remind today of on the forward-looking future the statements caution term of our measures, or or to these and reliance implied products statements you and a or that the ended discussion these based Risk than the Exchange the are we in of our required on caption update A of cause XX-K for differ are in factors and Securities our Factors, with release including risk the our that set make XXXX.Any could materially detailed obligation filings and and earnings statements forth statements information other by upcoming undertake forward-looking call to these as XX, to of new no assumptions Form this we results future as under on events more December Commission today law. result as year press investors financial period business regarding believe to measures, and Also on to we non-GAAP core provide for today's for call, comparisons of our operations. condition will financial and useful which and present we be results GAAP period useful will our can which both information measures the substitute financial found the our Relations Investor section accordance earnings available a in and for full materials website.Non-GAAP of presented our financial measures A in in with are to calculated as definitions GAAP. addition be not on list can measures at appendix GAAP quarter financial fourth investor.oportun.com. our section at included financial the supplement non-GAAP all in all earnings of the Investor fourth relations presentation, which our measures at and XXXX earnings section quarter of press XXXX available A release, reconciliation is of of to are our website the

In will be call, call after remarks.With now Raul. copy turn addition, archived a of along this and I an that, the prepared over our is the webcast call version will being available to with

Raul Vazquez

and everyone. Dorian joining areas afternoon, us. our progress I'll update for on quarter Thanks, our Today, performance good fourth of you Thank the you key in business. discuss and

Let me highlights four begin our with QX of performance.

record of $XXX year billion, First, close million a with up XXXX revenue we generated $X.X full to XX%.

than was XX.X%, year. Second, our last charge-off better points XX net QX rate basis annualized

our addition, first for measured since prior the year. the dollars, time lower XXXX, In in quarterly were net charge-offs, than

promising. severance million, recurring for performance. are were earnings on seeing goal now Jonathan of Third, we business GAAP represented $XX page to our that dynamics three and of share backed made changes shape, team the improvement non that I'm $XXX shortly.Turning to the I are with signs year-over-year when stated credit more we're met performance $X increase. cost most I'll details and XXXX. on adjusted provide million relating $X our XXXX, the quarter seeing actions executed QX million, down million EBITDA a to operating operational we our recovery our the in announced our the out.Finally, of GAAP in by credit early quarter a was positive and year-over-year. decisions well call QX areas We million expenses find start will pleased X strategic related and $XXX of OpEx driven I'll XX% Overall, our taking

of represents loans.As approximately XXX of front lower since book to in of loans in presentation, loans back a rates Slide of are originated of The tightening X back first for to material our book July earnings book loss book our the loans XXXX. on origination First, as prior are you can points loans then. comparison reminder, front basis the see our

half You own principal of our the quarter, for diminish at to also fourth end that the charge-offs. back of the to can continue our second own The to buckets see below plus XXXX charge-offs XXXX. time principal gross impact XX will is this for balance on as we importantly, our accounted X% below XX% shrank good of the X running Slide the year. when This but disproportionately levels. XXXX the last the shrink XXXX, bodes and the book years below our the ago, XX was year book the days balance forecast are X that news XX% of year.Second, was more throughout in X back delinquencies future day book at stage of were back The end of of to our well performance prior to delinquency early currently

months the the of our app servicing strategic approximately exhibited our not so originations.Finally, were of have the have XXXX.Improving than Third, our Digit leveraging priority, points personal product. plan loans increase underwriting by efforts charge-off enhancements continue XX% better outcomes members promotion growing net a who on credit Oportun identify as year delinquencies and key mobile day app. lower XXXX loan annualized personal in just our to unsecured up a portfolio stance than and We app underwriting signed Savings and mobile focus adoption integrated over high is XXX plus secured know our on our personal conservative we We will secured borrowing visibility, app. ago, X finished our yet loan who levels We those year disbursement basis mobile sources plan of to part that this to use post that platform. approximately our XX with priority app use quality now we app to launched models,

second management. The area is expense promising

are average were public ago. became significantly X mentioned can more we we we earlier, presentation, QX see business XXXX are percentage appreciably and efficient core down a areas to QX OpEx of goal and these priorities in economics additional I few on XXXX.Fortifying as for balance years principal today managed OpEx our share decisions our will As met our of XXXX in minutes. company QX than X a unit as versus and Adjusted earnings in a in was I Slide we XX.X% made you we when XX.X% our

final and that third I promising of to funding. improvement is The area highlight want

improvement order the recovery. model.Again, its business oversubscribed. improvement, by full levels, will we fully incorporates by an points bringing we encouraged an when annualized these a signifies XXXX as that XXX most amendment XX cost other Our in expense $XX an executed lower that recent actions these less is interest a that XXXX. the our we're the X XXXX. announcing At in on and OpEx basis as my in The generating we to strength work closed to quality share $XXX 'XX this of facility beyond, term our term annualized month our investors confidence first than cost with was the total million and expenses million for to and loan. QX our to since $XXX senior In weighted The our substantial holiday October in our to February, additional business with principal reductions guidance this execute million. all provides X securitization, to secured year but completed which view, to we originations, X.X% basis, and plans our rate, residual still our of us payment average times credit will securitization continue realize end, extends To our you to well there's recently our enhanced operating Jonathan management profitability.Finally, year with January ahead significantly I'm of started residual signs XXXX the the reduce X amendments, efforts have facility

outstanding covenant have some to make which levels before for loan the to cash that needed caused than our senior The principal to ratio, been higher by originations the set unrestricted lower XXXX, the will payments financing payments the in which credit amendment facility. lower were our asset losses residual and of of escalating We and facilities secured this the equity expected senior of the reduces on the secured made loan XXXX's debt.We ratio on tightening. equal in is coverage the amount term minimum would term

the In achieving summary, XXXX options. increases coverage asset covenant scheduled the well strategic guidance. the are on will additional and we've the financial refinancing and I to performance, today ratio made position challenging over path our quarter by the decisions a announced XXXX as the it to for of for into evaluating company, very in that, I first full last remainder levels after XXXX, on twelve and details Given are XXXX a Jonathan stronger and that currently right year we for as months.With over we confident changes XXXX, the our am operational quarter turn fourth driven have

Jonathan Coblentz

afternoon good Raul Thanks, and everyone.

solidly executed quarter. we fourth mentioned, Raul in As the

We substantially differentiated XXXX are initiatives laser our our tight and on beyond our enhance products, track our profitability posture. cost X credit to by core ongoing and reduction on focused being alongside in

tightening quarter resulting from us basis due $XX As of adjusted anticipated, our delivered credit short loss virtually the portfolio shown on posture drove a lower million actions down be basis third originations which yield, to an quantity Slide pricing fall non-interest growth. flat than $X.XX.We $XXX in with of X% total XX% tightening lower year-over-year. our change per were net an year-over-year million, credit to increases expense of points originations revenue XXX previously revenue and credit our million, fair Oportun originations Despite originations, dominating adjusted loss traditional of target. the focused of increased down to XXX with continue was on were XX, to for patterns net income.Our led $XXX of originations interest further share points total higher seasonal of rather along higher with impact higher quality than or causing from Sequentially, year-over-year value

increased our I'm adjusted portfolio charge-offs, basis that However, yield, QX risk which year-over-year points. includes a by strong XXX pleased

our remaining We interest yield and XX% $XX mark-to-market will to down cap.Net was expense. XX% unfavorable continue while higher million, APR year-over-year fair to value revenue to enhance adjustments committed due

We a decrease of asset $XXX of total fair $XX backed points mark-to-market million period portfolio XX primarily to million notes our offsetting charge-offs to by current on loan partially these marks XXX% increase of and due consistent value discount in net separately at million, million the a rate.Before the balance fair driven accrued on to value adjustments more out at fair $XX of our with portfolio's other loan basis decline fees fair our value adjustment mark-to-market value are change the recorded now was a loans so continuing, Our sheet million, of loans in in on these made in on $XX sold financial sequential We increased would in on sheet. unfavorable a our on drivers, $XX made by included this fair and the presentation point balance loans. change receivable be that interest our we've their want companies previously loans I fair value receivable presentation value. and

fair historical have changed. We none so our change. and a period, prices in have To announced we be initiatives. interest the We've balance accrued rate increase past. continue is and line thus balance only higher $XX change, debt not the the figures was to the expenses in primarily was of X.X% numbers higher updated this of outstanding to sheet reflect items, to ago loans clear, the up in a aggregate of for quoted efficiency, value reclass X sheet by X.X% increased fees debt restatement.Given have year-over-year. our accrued the our $XX this that This structure combined the interest benefits reflect operating fees to and year see previously expense prices this and excluding and than now cost cost now environment.Turning optimization our of driven our versus million the and million we Interest include reflecting

marketing rate operating total a continue headcount charge improving reduction strides XXXX and the reflected expenses year now significant with additional quarterly million, for our expense XX% were down announced We will our million our expense of the operating in operating the period targeting a in year-over-year. QX partially million quarter, structure and $XX.X Raul fourth that XXXX GAAP operating enabled $XX by reductions. million prior million $X we included severance and are sales in expenses.In $XXX $XX reductions streamlined QX XX% to our drive in run announced, our product through to in made over just non-recurring we lower previously cost expenses Our from annualized related suite,

and $X.XX adjusted cash compared and versus For in prior share the an recorded of excludes was reflected our in notes net value credit mark-to-market year-over-year loss million we which net higher the interest driven adjusted by sharply our portfolio million driven increase $XX year quarter discuss a primarily let fair reduced Slide quarter, marks loan $XX This on net fair earnings of and $X value our profitability adjusted the quarter. structure.Now of expense. by per prior adjustments to the non per cost million, of performance. Adjusted The EBITDA, impact fourth me $X year loss million, of share profit a XX, decline on $X.XX. net QX in strong was

annualized guidance XX.X% year in charge-off range. midpoint of rate the the Our net period. was our at prior This to XX.X% compared of

X.X%. XX points plus basis Our rate increased delinquency to year-over-year day by XX

between upon we and we've Based delinquency this mentioned and seen expect quarter day X In actions. improved through our loans tightening are vantage greater to recently 'XX underwritten delinquency we XXX be week, surprising, for XX X.X%.These to from earlier start what to Raul XX% trend the addition to first begin delinquencies day 'XX, continue. prior delinquency data of XX XX the our trends decline given improving, plus rates last increased during percentage on expect X.X% to plus to QX to QX up scores the rate or of of with not XX%

of million, Regarding flow sharply pleased our used repayments million reduced investing debt loan capital remained at near to quarter cost levels year-over-year.Furthermore, repayment from and for principally flow net million. top and this operating in allowed up net operations cash that disbursements, for line fourth $XXX liquidity, resilient cash performance net $X our finance and I'm fully record our activities, structure of cash $XX XX% the in

December to funding responsible agreement grow remaining of June quarter since sale executed our I liquidity, sustainable credit $XXX securitization. and asset-backed and million million, lines a to inform our total and making $XXX continuing our cash unrestricted that total capacity of of product Oportun to end, loan million under want our million almost ensure million restricted, and further in you have evaluating billion.Before capital available that we $X.X update XX, capacity was in As a $XXX was funded strategic good our to fashion, soon. we're since for which card financing bolstering $XX agreement $XXX closed $XXX and was brings liquidity options to was whole warehouse leave of million expect is progress This an I discussion funding for you and

adjusted initial year guidance X investment wanted the on community.As we at asset-backed shown our to relating I with value you income to update going EPS. mark-to-market provide value excluding fair to we providing Before to performance we XXXX, from forward, XX, you impact the of changes on adjusted are on Slide notes adjustments the first, this net fair and metrics our be making adjusted will

Second, more in calculation other with we be our are adjusted companies EBITDA those of adjusting of our to in space. line

for Now share you detail decision. let regarding me rationale the more with each

This then of and asset-backed XX% converges negative par $XX rate the of $XX environment expect year end recognize of is driven mark-to-market in XXXX, so our income have net after adjusted our than pretax adjustments at of notes there our indicator value currently now, maturity. valuing time.Between reflection our our be the interest the by fair update no reduction existing mark-to-market debt of million as health at to to all a for adjustments financings. is calculation new our fair we asset-backed our business. GAAP rather will on paid earnings at debt to been By off, decision stop an valued to higher will basis, Our debt that nearly election last million

net adjusted it income metrics. forward, and backing we going out will from EPS our adjusted So be

our adding expense adjusted to companies we we beginning over with in net more other respect of to will and acquisition X be in closed calculation no XXXX, our Digit QX for income Additionally, back of longer adjusted calculations integration-related since simplifying consistent our are acquisition EBITDA, be the ago.With space. years

loans longer their EBITDA. not this the other earned since adjusted fully at we our origination changes XXXX that Going companies are no timing of we cash.Had is will $XX $XX calculation in million reporting, on forward, adjust an no need these difference feel applied we adjustment adjusted higher that disbursement see our are the would adjust year EBITDA for we in longer been adjusted non-refundable to and receipt of the of and reflect we have of an at loss Originations net fees net making to full time million. income for net

we had net $XX year to on applied total million for million at $XX net million been been million $XX $XX points, revenue XXXX guidance, XXXX as lower plus million Full $XX million.Turning of rate $XX have higher our been adjusted loss while $XXX or have changes for at full now million. year year However, adjusted income the XXXX these negative $XX million, million. have XX, Slide would first would of $XXX annualized minus basis for EBITDA EBITDA shown our adjusted reporting, an would higher to full negative is, for adjusted at EBITDA XX.X%, outlook net charge-off million, XX of to $XXX of quarter adjusted

of share to of first The while for of have XXXX revenue personal on basis like. had we alternatives returns and for that, look investor the for guidance, million see back plus minus full would of million we a you principal return with charge-off owned yield is are changed quite to not for Raul to the a calculation.Before to Our XX% or a $XX million handing this and Oportun expenses negative year annualized believe loan XXXX $X to economics been XX.X%, $XX close, $XX percentage are could of our of XX.X% which total our call X% to X% we basis, the negative And I'd million even $XXX at over excess quarter from rate, non-interest strong full million what be long-term rate guidance in assets $XX points, $XX of our like EBITDA APR, XX% new operating to we Add calculation of million.With XX what product remains. to total the EBITDA as deliver to adjusted billion, net to respect XX% our assuming to $XX is unit as XX% million our savings for revenue business the year adjusted XX% to X% our balance annualized to members. yield well value funds of income, charge-off over predominantly see borrowing an we a cost of net balance, sustainable.Conservatively on risk-adjusted long-term principal assuming X% and attainable. guidance

debt-to-equity ratio a funding potential and robust term. the X:X over diversified a we very sources, ROE the for long with Lastly, a XX%, yield enabled risk-adjusted XX% strong see by

improvements have we strengthen and back focus, goal changes to over to made over progress business the next see ourselves you. Given the and years.Raul, several significant we tighten product making our its our towards

Raul Vazquez

Jonathan. Thanks,

time wrap include who most welcome in position from of years XXXX Consumer at credit analytics and Square experiences X publicly members, His risk, I in investment newest Oportun's Banking joined he XX prior up, private Carlos Services, banking equity Carlos ThoughtSpot, Chief February. Minetti an Inc., as PayPal, at including recently of company. Discover Minetti I as as executive AI-powered roles Officer Daswani, Before well Directors President, Mohit to the XXXX. Financial and is experience and Daswani industries. board consumer the has Mohit and held Financial lending a more independent want than our in to Board of

on to long-term consumer and the and We in for of do to experience.While backgrounds affordable perspective, in our the responsible are just on step their that credit work profitable the talked and with recovery we we we've establish resilience, fundamental savings. foundation From a towards type adequate financial the are and guided and already have executive board finance, by X have still we public Jonathan holistically to along of most addressing profitability to company about, XXXX health and them the laid are sustainable, pleased extensive focus defining a expect journey access to to XXXX growth. our strategy challenges be leveraging in

our so savings our our high-quality secured personal We loans with personal will outcomes, X improving by origination. do product on and loans, and fortifying credit top identifying business economics priorities: streamlined strategic executing and assortment of

disciplined let's are the QX management, importantly, expense We and line due open questions. more that, February's securitization optimistic XXXX million operator, $XXX credit about to trends.With promising for up our the

Operator

Instructions] Thank you. Thank [Operator you.

Sanjay Our Sakhrani first question with comes from the of KBW. line

Steven Kwok

Kwok is in Steven Sanjay. filling This for

the day credit the on in quarter XX%. on first XX-plus the Congrats of First delinquency around quality. seeing improve

wondering, it the about like at of rate Can this within assuming? that? you year, guidance. remains was Just the it environment still talk driving that What's look just we pretty as what's elevated seems your you're economic

Raul Vazquez

saying So That XX-plus when that QX, X.X%. expect to year's to we we X.X% think delinquencies QX. rate last X.X% about we're DQs, compares for right, of

right So we're optimistic seeing actually about really what now. we're

the year only appropriate terms think us conservatism. from what We're year. full we an into guidance, weeks you're appropriately, In still just is seeing of early year. the is in level the It's XX I think what of

would that second hasn't the would right? X the of we're we delinquencies, delinquencies seeing in Steven, appropriately is below to XX-day guidance. but into right we just in hope continues in which now it mentioned hold terms year, better are I We think So X early half the translate to expect loss years. performance is year, the what happened if prior you're of seeing that conservative what that to what

Steven Kwok

in noticed fourth about quarter. the within guys then just took use plotted you think credits we the I and against would And vintage. then were If us adopt And XXXX Could help to the further that and talk like look tightening through how XXXX, XXXX today? you that?

Raul Vazquez

amounts. shorter still over try some sizes loans $X,XXX. and we environment, we loan that it at, say, look we larger of ahead take this of could do just go loans, things particular, is smaller sense in actions that to terms, loans reduce makes tightening in the the last We give continue just one the think took quarter, to and the with in of terms loan in to So a that

So that did. that's we tightening the some of

with pleased results. are we far, so the And

I what 'XX. think of the look that front our and QX saw book, like QX X if we on we are where the vintages all QX below you deck plotted 'XX the on of QX, earnings lines Page the QX and like fact of

if like asking expect would we what a look those early XXXX the that rates look that. as what So to me vintages you're I pool the an like? X.Steven, give way it's know, project like. update quarter Page on static every those little think on loss But to you we I static pools look

that So we'll look a all get at over time.

Operator

Thank you.

next from John Hecht line with of Our Jefferies. comes the question

John Hecht

Yes, $XX you of to my year EBITDA or 'XX just just any not I just -- around looks marks does can mentioned, mean million that the that like trying the million guess, that in loss a Jonathan, us guidance. us head apologize, of fair -- it -- net you're debt like fiscal does I'm kind include you $XX around value you I of get the don't -- mark-to-mark, on for mark like include have you that that loss. tell the including, gave value million reconciliation $XX fair your Does projecting? the the what's

Raul Vazquez

have EBITDA, if changes I'm just talking about you adjusted to income? dive be ahead or I but is adjusted the income to sure net not guided because question, go adjusted on Before EBITDA the clear, are about your into question and adjusted Jonathan we net

John Hecht

net wondering fair be no give I'm a or says EBITDA will adjustments you and starting adjusted just as in in loss. mark-to-market to value and it the Slide value point Well, XX, net that fair No. get mark, to the loss no income -- that on net the

So to that? I'm in in bridge wondering, not and us that can what's you kind what's of

Raul Vazquez

here, losses and presentation says last marks, positive, were year in So our forecast marks net guiding for out haven't This be do negative, using view be would was what number excluding to net it if calculation excluding out this since the It John EBITDA the fully it of marks. right? like is is adjusted starred on be higher net new -- right? net before, reconciliation million a marks number, Asterisk $XX right? so to $XX back million a of some we're volatility to the and the if is of Sure. basis, this the would that adjusted to is because I'm turn the expecting happy marks But adjusted helpful? we has the the XXXX. the of Is been footnote this this EBITDA lower been that, continues since saying table, we're have we've to to income that all for

John Hecht

between and I this. something my probably need on adjustment some million time $XX hands to mention did fair a end the like you value around the But get debt now the of year?

Raul Vazquez

No.

Let That's me net made right? years, adjusted to EBITDA adjusted So forward over going both income. to we changes X to calculation and clarify. our

for that of added For it What adjusted EBITDA, hasn't we're not is income part going -- that has fair changing always made any we net mark-to-market back we're changed. adjusted the previously adjusted full EBITDA had value mark-to-market, that where changes. hasn't

recall financings value we notes, for fair new the to on electing stopped any we Now the did. that year, asset-backed we're just right? out the be backing value impact going mark fair of last starting So

And $XX they to that maturity, bonds our As right? of off, par, notes still on right, fair so going relative go par. currently, And go are they are they value price, $XX discount marked are balance sheet, there million right? to so to run is those right? at to a And

impact, So X we're income going the we the full would expect that net GAAP years, next to right? our not X X realize so And year, to in next over be... over years,

John Hecht

So that's [Technical loss Difficulty]? I'm net not but 'XX year the that clear, in you put fiscal for

Raul Vazquez

right. That's That's right.

to use half. example and do an right? just simple Let's it's math together, half let's So say

back we $XX we that $XX half 'XX, adjusted 'XX whatever will year, impact in we $XX So in a happens notes, other -- would will that have higher. income a report the adjusted one, adjusted, loans. and that is of for the out say when that mean over if on right? the fair of right? we'll the number million, million of But a that course the there So the which number half half value the Let's side on -- be million year, the it recognize of report be benefit negative net will will when basically, two, for is the

You may to have noticed XXXX. income on that for elsewhere our have and adjusted profitability in expect our basis materials remarks we net this in

John Hecht

in me, value what the fair mark -- how sold year? then do And coming on about -- think we remind loans the

Raul Vazquez

behind Yes, a that's includes treat We'll assumption our our an EBITDA. a way, value forecast estimate sits loan and forecast fair sold. So for the within same adjusted that right? that got we've included of in guidance that

John Hecht

I to the this the... take the might have gap with to understand Okay. offline changes,

Raul Vazquez

We'd that. be do happy to

I I would years. thing the the think because the is, though you've noise, add followed over for have company right, the created years certainly marks only

the the One we to really I'm in substantially comments, mentioned communicate trying in XXXX. that that in about enhance our our to Jonathan his profitability were we fact comments, optimistic things of and that expect

expect can of to X other, significant year-over-year in expect and You been as I do Again, in a in by measures be though profitability right? well the track can income noise. we EBITDA, though adjusted noise each net see as has bit well.And net net there GAAP that improvement there a income, we because large mentioned, that think GAAP in adjusted Jonathan income again, tend

makes that benefits of positive now and see We So corner. losses. things and trajectory that look OpEx We funding the at good about we the of the and indications also is really at the significant the one feel us do reductions. the turning look

profitability head little spend said, right it, in a takes off-line, expect improvement like you it bit time year. but to more happy do one's measures significant we wrap this the all around So to

John Hecht

then you loans, net but then there's also in that value fair charge-offs mark-to-market the of could have And adjustments, the correct? adjustment out you

Raul Vazquez

any no, reduced Charge-offs right? yes, charge-offs added to these of well, not earnings metrics, Yes, right, metrics. back of are all our

John Hecht

the I the get there? in does Does it So and -- I'll apologize net back have anticipated the charge-offs loss stated as in queue.

Raul Vazquez

Yes.

John Hecht

not value So it's charge-offs around it, marks? but fair

Jonathan Coblentz

That's for mark-to-market.

Raul Vazquez

been to true. always and That's right. true adjusted that's that of Yes, be continues EBITDA

Jonathan Coblentz

in Page those on XX, is included losses loss But numbers. are absolutely

John Hecht

I think guys. you a I'll follow-up think with schedule I -- it. got call I

Operator

you. Thank

the with comes question next Securities. line Riley Hal Our from of B. Goetsch

Harold Goetsch

refresh of XX.X% cuts, where your the a for economics to the going a you is goal of quarterly operating One are of And big? expenses cost remember Is what expense the ratio. kind unit think be I bridge, for on number portfolio you certain increased of have the how level can that level? got X do or a the you that's a questions. size targeted

Jonathan Coblentz

said XXXX, So in actions that, just remind around cost $XX.X cut will earnings with this are million. year additional targeting -- actually be GAAP you, of OpEx quarter to that now we I fourth these said we

Harold Goetsch

Okay. you. And is thank that,

Jonathan Coblentz

Yes.

we getting to portfolio expect And year-end. question so about operating that we expenses, back be your to the said also flat the generally then

So anticipated. that comes as -- that that's to let's say pass

right? so you quarter GAAP mid-XXs, the that by And fourth future growth. it annualized, XX.X% took incremental if $XX.X come and the and you receivables in number in the some of divide a would get OpEx in can So the owned you with up million you with just to

Harold Goetsch

demand could give a coming platform? demand a there's you lot the for you then side? a what's add And on So tightening, over color of like sides could us that? of the consumers, side on comment of high-yielding both this subscribed for for the investor suggest the us quite is give you a you Could little just And feel funnel mentioned side. investor X, on just consumer in feel demand demand XXx the on for high paper. another but the Clearly, top

Jonathan Coblentz

for strong been certainly, well now. loss model. deals in years the has but certainly particularly of that, business ABS future our represents it's following market XXx And as also with the platform side, deal XX So performance, did confidence we we starting funding doing as benefited it we've strong asset-backed indicative was in market a and Oportun the in February the is over over subscribed. from our securitization that It since

right? included So our slide yield.Raul, want those to that that's exposure given And you happy to to strong recent are recent loss do X, which question? you performing, Page performance certainly, how only one market continues at terrific, in We come we right? points would deck that expect looked vintages And included where XXX priced to we this the basically consumer at strong investors our take be than basis risk-adjusted the take shows this to deal and the well market on more was were vintages saw were the primarily. it year.Certainly, and again would investors the we actually of things and in October X.X%, better

Raul Vazquez

Yes.

-- I our that we in conservative to if QX, underwriting in shared consumer earnings the a in the stance. at XX% earlier, have year-over-year. right, mentioned million earnings, $XX side, as deck On certainly we have was Marketing, marketing we continue you look down spent that

door the with as really lower credit our given to and to from the feel also who with we're up how the effort.So something drive share attracting right we of actually continue we demand could see marketing continues demand. the the think terms funnel, we good to we're this see at that that if potentially demand is top a credit pleased about optimistic through to expenditures, good who's we performance we half see marketing I coming we second now the the of ourselves and open of and perspective, economy trying year that quality So in the did starting in that normalize the we're about more think

Harold Goetsch

Is improved, safe commentary is, last vintages after my that message be fears to heard And or think that I potential -- sure tightened. in in is follow-up weakness that's mentioned it the or performance third today? I call, something either to the initial the from away bit little just make cured those a say take that first the right. I itself were quarter of And that would that today, you

Raul Vazquez

Hal. memory, great a That's

that the if very the QX that or look very, tightening say, at you about, same end be, tail of Jonathan beginning talking So of that page kind of first QX. would was

like That QX, below is see could we separation. is vintages didn't QX you QX, but purple top right? line. So some on start the of QX, that gray we to see line, that separation, recent even are the there more right the fact

confidence we tighten led and what we comments quarter. delinquencies prior is and credit view lines Those QX indications as the in right, new for like in reported if are positive Jonathan to XXXX, of including to desire even we've this profitability the giving were good these $XX that continuing the reduction, year X the below And to to right? on what our really certainly 'XX. you we continue and is with right, turn for million we the our think from and are be to mentioned, things that that hoping look good see perspective, below this a prior below a of started leaner, running us that run the kind improved be year to successful and things then combine these ourselves last we 'XX delinquencies just the that funding, So our corner that as from the things We're we shared QX really with at hold, one setting OpEx we're a 'XX early up that 'XX. could XX securitization.When in right,

Operator

Thank you.

next with line the JPMorgan. Our from of question Rick comes Shane

Melissa Wedel

to about thinking of I mean Or should we differently the of towards the you in It's last the or actions Melissa to that I I shift today. over anything be should on given that extra of a wanted NCO seasonality? taken NCO continue the for this expectations Rick little months sort cadence during on normal of you've rest so, trajectory XX some sort bit tightening wanted ask the book the front year, expect with trajectory? but -- year. we over to the the expect on dig or also

Jonathan Coblentz

expect would normal seasonality. I

most our think of return normal elements business to of the seasonality. year this I will

probably that's assumption the modeling. think I to for best use So

Melissa Wedel

from to skewing origination. sort of it What period, the to slide Does contours the inflationary seeing curious towards comment are what incorporating account geographic for about in risk I'm secured, an learnings the does that dynamics? some some more done you that? And has the in mean a deck then new change model of of to that

Raul Vazquez

there elements much that I they've X, Number that loan. we're seeing. necessarily after on individuals allow adjustments that some we've look to think we the us are to made as think Oportun taking out that going of aren't taken a couple for are debt

to but that time we the the at certainly, I a file X vantage people able ability which find thinner we in ahead to the go I about of Melissa mentioned.All that we've are in the think given have the to the us go been same chance been talked execute some that things strong it's model, then also mentioned. individuals that today. with ways, with terms to us, finding lower those a shorter losses some that to are of for historically niche individuals back the And scores willing and think we accept think and improvements we high the

our to points XXXX for book loans this the able about be loan that loans. performance year. personal drive credit something unsecured that be XXX lower Your remainder is to secured secured on able personal loans losses for of to the is than We personal year to and think of going the comment basis were X going that of objectives is good we in secured also grow to shared be in

Operator

call the Thank to remarks. you. back I'd further this to for pass time. questions like There at closing are no over Vazquez Raul

Raul Vazquez

on speaking you. again and forward everyone soon. we Thank for you to once look thank today's with to We us joining want call again

Operator

concludes This you. today's Thank teleconference.

your for participation. lines at you this You your may disconnect Thank time.

Oportun Financial (OPRT) 12 Mar 242023 Q4 Earnings call transcript