GSKY - Earnings call transcript Q2 2021

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Operator

Good morning, and welcome to GreenSky’s Second Quarter 2021 Financial Call.

As a reminder, this event is streaming live on the GreenSky Investor Relations website and a replay will be available on the same-site approximately two hours after the completion of the call.

We will begin the opening remarks and introductions. At this time, I would like to turn the call over to Brinker Dailey, Head of Investor Relations. Mr. begin. may you Dailey,

Brinker Dailey

good results Yesterday, ended for XXXX. and press June issued release announcing its morning, you, GreenSky everyone. a XX, Thank second quarter

can Investor on website. You press of section GreenSky’s the this access Relations release

Officer. Kang, addition, and Chairman which refer will and Officer; presentation, hear Chief In XXXX remarks Chief from Today, Andrew today’s we’ll have Executive second to posted quarter our we David President earnings call. prepared during Financial Executive you Vice our Zalik, and our

also Gerry and by are Chief Administrative Chairman We our Vice joined Benjamin, Officer.

will projected. yesterday any differ that any and Before risks forward-looking we included in required materially well remind that assumptions those me are risks begin, We current are as to to except subject about issued uncertainties update These is our let and and with law. the uncertainties statements, and release you as presentation based to are on by press could obligation forward-looking and Information discussions in cause regulators. statements. as filings statements results our these include disclaim than actual

discussing our of materials, page press to also David. we dated you Relations July over be from non-GAAP GreenSky’s release analyzing performance. These and considered to will website. non-GAAP in the turn measures are time, substitute all isolation measures described superior I call. Investor and the call These on counterparts the XX, reconciled to At their be presentation and non-GAAP the intended measures in GAAP will We a on or this XXXX, measures when for to GAAP today’s results, are to not financial consider encourage our

David Zalik

you our delivered quarter the second morning, GreenSky record XXXX second to us and been achieved results to have have our without quarter. of consumers Good today associates. of and partners, joining Brinker. and in for hard reflects you, earnings quarter’s of company’s initiatives past strength operating we performance The everyone, number results. achieved and commitment dedication long-standing a could our key work this the on thank Thank made merchants, GreenSky the not review funding and the

has Our and strong you’ll by the our consistent I remarks themes. the that will was start important highlighted upon. to elaborate strong continued notice several profitability today, and achievement year Throughout accomplishments of X metrics

made volume and First, GreenSky in has and leveraging grow strategic great materially our progress, transaction future. in that relationships the investments will sponsors merchants

Second, quarter. earnings directly focus is continued record of loan the our reflected on our on profitability our this lifetime each in originated platform

X. Turning to Slide

XX% million, improvement path our was a last delinquency end exceeding represented this what During in consistent EBITDA indicator in and increase funds GreenSky last XX X of our for the year. X.X% company EBITDA leading the the direct of which the months we annual of sustaining day a second quarter, net our in million of $XX our resulted operations. a and scalability XXXX the a from the the $XX delivered quarter, second record, result of of $XX quarter also cost margin a income record improvement million, of outlined Adjusted was adjusted Day an rate, XX-plus basis with X.XX% accelerating towards of XX%, of of Investor at January. GreenSky’s portfolio long-term adjusted past the the EBITDA quarter, at end performance, during from margins points

year. investments stronger, from technology. which diverse same and shortly, Transaction results liquidity, model our without our dramatic contributed significant representing from improvement the XX% in to directly our process us the and people, the At consumer this quarter the and $X.X point, Andrew profitability has contributions cost will cost the our lower improved of from quarter. for benefited GreenSky’s billion, achieved we to environment previous this XX% more While from of funding allowed optimize increased benefits a have a cannot driving expand portfolio macroeconomic volume revenue, as to period the upon funds, of these

year-over-year, with we that our and pleased constrained a both a continue impacting the quarter in labor second are by sub-verticals we supply also market, While to improvement. to transaction recognize which challenging be chain growth be number directly volumes impacted of home continue

leading More key quarterly are momentum the the in to quarter. merchant optimistic importantly, quarter saw the we and and demonstrate all-time that in credit sponsor we lines approved of record recent wins strong continued first the including second positive indicators,

These will the practices fourth have above will trend not of agreement. best-in-class which previously the practices received and matter, impact contributions the and protocols upon volumes called our and have quarter expect protocols volume only of business resolution the implemented trends. CFPB proud already been on to this translate ongoing we by and our for Relating historical CFPB and our further experience. our will Andrew provide well matter, of any and into will transaction enhance consumer to record relating disclosed target. elevate by transaction serve many the our are operations financial ecosystem will enhanced that We -- advocacy that implications the have very this would our third adverse or merchant seasonality consumer to of growth details

quarter. made to enhancements throughout on Moving X. to Slide its technology GreenSky significant offerings the

continuous technology to advantages needing a wins of that and using competitive functionality. Sale of cloud quarter. this migrates as qualifying version around a GPS commitment believe of and remain merchant innovation in improvement mobile key released security, We speed environment. further applications we examples our We technology to provides in secure strategic The of our these which was our sponsors large process number updated mobile to enhancements X.X platform technology committed to feature our and environment. factor our are extend a access innovation, highly consumers Point our credit and new Specifically, a application,

XXXX Most growth, HVAC sub-verticals. sponsors, notably, to generate the incremental volume This of shift continuous $X agreement. and $XXX our the to a the build to of relationship we the an outline sponsor to million the share further EGIA company’s annual nation’s finalized first-look diverse recent important other like and from and one proposition largest X-year over course transaction As expected market in key great is best-in-class competitors will on with momentum in with EGIA. of exclusive volume we transaction billion The providing briefly across of improvement, to deal compared some service when very valuable technology, commitment look best stack. volume to transaction targets tools, This competitors. market I’d array merchant wins the contract value

with provide have the been coming testament beneficial members. a of valuable expanded this many and accomplished should the meaningful While GreenSky incremental it relationship to EGIA was contributions cannot volumes without years, also long-standing GreenSky mutually relationship in sponsor to transaction team our

in in grew industry-leading kitchen and bath our space. also we We position the partnerships other our and home through of made categories improvement with leading in new significant doors, strides completion and national the windows manufacturers

leading alone, growth excess an Angi Inc., a are services. transaction with marketplace that. contribute beyond wins, in this expected for opportunity alliance additional Lastly, to our the innovative home we of XXXX, volume with $XXX These million significant in finalized with incremental digital combined from for quarter [additions] in

to that I’m in Finally, to coming the announce solar residential offering pleased GreenSky expand is planning our quarters. very

and market profit the profile. We’re excited large about addressable

land in for strategic sponsor second approved investments and platform. and made demand many Our key merchant credit ability consumer and lines our on highlight record have wins quarter execute new Technology process the strong results show we’ve relationships. helped strategic our GreenSky’s to improvements

We’re I discuss will of financial over excited growth that beyond. highlights. quarter’s fuel recent in to it half to trends the now XXXX and our wins second turn and will Andrew

Andrew Kang

good and David, morning. you, Thank

financial quarter second the X. update to Moving on Slide

of As million, goals GreenSky achieving the the of set adjusted $XX.X record EBITDA of $XX.X long-term EBITDA reflecting income adjusted year. strong a the XX% David we beginning margin at the mentioned, These for results and highlight and this reported recorded quarter. path to outperforming net accelerated million

rate margins importantly, loan by our growth closely Let me rate this origination, up increased the year. correlated reflect little to of driven transaction transaction increased million, The X.X% quarter last a revenue to and second a fee fees exceptional year-over-year, they the XX% million, and APR for yield X.XX% performance drivers higher transaction was for is rate transaction the to profitability. the products. XX.X% tightly increased associated reduced at bill $XXX was fee quarter, deeper loans Total in demand end and for of X% while $XXX and how from dive volume sustainable at X.X% APR in APR year-over-year. with which into

We recent fee this to are transaction of second rate expecting a of in half X.X% continues year mix trends. the as reflect

fee prior As to rates are collateral before, origination. you I’ve with transaction correlated highly APR calls, earnings at mentioned in

as our our take While of lifetime may profitability always products, merchant takes volumes maximizing the demand across ebb both we take account well focused originated rates all as our transaction on of as rate, collateral platform. consumer into and of loans the on have the and flow been which yield we are,

change the asset end rate point For X.X%, basis grew value dropped performance to XX% year-over-year $X year. a the servicing in day delinquency cost fair portfolio revenue X, XX-plus quarter, lower of our to improvement and the to million service. improved due servicing increased million Slide On expected of our $XX representing XX since approximately as last

provided for relief a reflects XXXX. our with on credit current our origination economic our enhance to tightening first At peak, the the recovery final policy. benefit, performance portfolio for without credit program merchants, update stronger have accounted GreenSky’s would investments its behavior to approximately portfolio. X% our made of drive service While and I and like the consumer looks provide more direct has process disaster a COVID-XX program we

represents However, points. less basis XX it than now

offered million of could our billion came a performance longer Since portfolio. remained the have perform. program improving updates portfolio meaningful customers at many program impact how view $X.X of then, end financial this that provided of going the We the no this ultimately forward. uncertainty at valuable than deferral COVID-XX on also this and on While quarter, less and assistance disaster of performance consistent the And assistance $XX that to our with we servicing will portfolio. program have

servicing overall Turning operational cost cost second The to origination quarter cost and with volume of our XXXX both and the year-over-year. decrease our Slide costs Beginning X. cost improvements flat its a GreenSky of the average million revenue [indiscernible] improved as our transaction to of XX% basis year-over-year. was of operational portfolio costs, in XX points of percentage by compared a result by of service was funds. $XX improved

million, costs basis waterfall exposure activity approximately quarter to a when of improved second points second $XX benefited which quarter, as by quarter FCR the average improved compared These XXXX. XX% loan sales $XX total our funds of by compared percentage cost the our year-over-year. million lowered of from XX the costs of XXXX. when the to Bank overall waterfall portfolio during Our bank

are now that funding we diversified last the profile, we If year, reduce that our profitability model we in seeing you volatility would recall, launched our when sales stated reflected and on results. our loan

additional of the in this bank costs approximately context, XX% of for waterfall servicing second our XX% year XXXX. quarter compared quarter accounted of For second in portfolio the to

loan sale costs, sale our and obligations loan we also which include at mark-to-market partner. a on participations balance on bank hold sheet Our loans for held mark-to-market on

costs included X%, on our $XX The were which product weighted million our sold discount approximately or sale of backed the all types, were some par. this For loan the and across above sold. million and of loans $XXX premiums was discounts which on [indiscernible] of quarter, realized sales quarter average

financial was waterfalls, driven to loans mix the related our of loan credit results last quarter’s lowered in we’ve time represented million related associated recognized in quarter and quarter. occur overall to expense loan the bank reduced in More since and included second million strategy sales and over in for also benefit, quarter an the our realized $X benefit the that sold of On loan which sales waterfall would mark-to-market the loans certain Slide our quarter recent an sale our reflects sales, expense. $X to cost This forecast. the portfolio We impact. previous on from quarter, discounts discussed revenue believe calls. pricing we this the guarantee This to financial for that which by sales which reversed was the our of and our improved obligation pricing GreenSky’s facilitation end bank the related specifically, XX, was liability of net commitments the guarantee improved a escrow improvements

$XX is further year. do the relatively expenses ops when for was the a compared not million second expect here improved expense XXXX. to X% And of any expect will the adjusted financial of guarantee EBITDA resolution by we $X.X quarter, company expenses, million. reserved for this expenses related incur the matter. of the expense was CFPB in excluding We the impact the and the At when were fully which remain from Included to and to matter, nonrecurring remainder Operating end flat also this.

strongest ever XX. been, remains provide on to funding to capacity which it the Slide continues to Funding Turning growth. support has

excellent $XXX in to commitment expanded partners a [indiscernible] to another one commitment. the improving the leading life bank April, a quarter, million second its million, combined bank cost million billion their forward was extending revolving quarter commitment $XXX fourth revolving on company commitments by of $X.X commitment of previously terms of second the total insurance our increased agreement increasing $X we billion quarter In increased quarter our to during aggregate by the into increased A and sources by and an We incremental million. The and agreement funds. a as with $XXX total $XXX partner of its commitment of $XXX flow quarter. Also to partner by our our an execute in million ability X XXXX. disclosed, multiple bank

asset completed we some the originations, million $XXX strongest seen have last we across year. approximately of with Lastly, loan in all the over pricing sales

water XX a have at of the year bank the I’d for available we and our at agreement $X.X made providing were We a In of $XX.X we months total bank have commitments moment the billion become to of end pricing increased funding ago. seen approximately $XX.X end, next future over approximately completed -- billion. consumers additional $X.X volume. of loans, commitments progress a step $X.X an way. funding partner waterfall billion billion pay and the diversified total, down like initiative to transaction sales improve as bank have and launching every commitments billion planned to quarter since take unused $X.X our partner we flow highlight completed revolving expect their were in in ample Our in capacity approximately billion [indiscernible] the

been bottom believe optimize have While last we we with and GreenSky’s we pleased funding capacity the continue to improving line we the we in additional which am across our announced very believe for capacity cost a with increase of have progress to fronts strong year very opportunities When I strategy, find enhancement, multiple profitability. I strongly over made also could successful borrowings, accomplishing. we grow that the in foundational

supply year steady We volume billion improvement noted $X have sustainable The to previous the anticipate similar our On the cash strong home profitability. over full unrestricted slight change the of chain the reshape cash estimate Our cash our X% our as corporate flows. XX, profitability ability reflects demonstrate cash, approximately liquidity we has increase the company labor our we $X.X continue future growth as markets. improve tandem to transaction and end had also growing with $XXX in since to return XX% to to At continued profitability. we to end updated positive David generate Slide headwinds from of million second in billion. highlighting free guidance the quarter, in the last and year, in

guidance updating to to our volume which guidance updated revenue $XXX million, reflects transaction trends. million are $XXX fee recent our We and also

EBITDA increasing and income $XXX are million XX% We updating guidance EBITDA $XXX $XXX to to to net adjusted the million XX% year. to million for million full $XXX and margin to our adjusted to

time strong continued in Thank profitability updated our interest I ongoing will Our back deliver and David. for turn have significance call the enhanced you how GreenSky. growth overall alongside to cost and periods. future to guidance now sustainable we the highlights in in your

David Zalik

for ready you joining are for us now we today. Q&A. Thank Operator,

Operator

comes question first Christopher Sandler. Piper Our of Donat Instructions] from [Operator

Christopher Donat

of to it’s into that but move of why Or in opportunity? decision? a first what on wanted the now, what’s the the of solar. see the side do you future GreenSky decision caused ask I I David, the realize changed market more sort business, the just to within

David Zalik

actually we’re the So a couple third quarter. small-scale of and in in things, launching

So building and we’ve in the controls prior out been the capabilities quarters.

between funding there growth a advantages be our is the a We we’ve the factor we experiences, and and something business and quite leveraging We we where prior work, appetite think in we the have protocols well solar. type And processes think built we’ve see we there technology, incremental. the our profitable for think that that certainly highly and bit that of controls for our product tremendous out have as of and in seen can funding. as material market our a experience

it, So and to tools, certainly, didn’t we’ve doing been that sense. we’ve a while, got for ready we’re and looking go. absent all make those at of It’s the pieces something certainly

Christopher Donat

Okay. then what’s -- issues just are prefer in seems of financing certainty the customers wondering to everything work supply with GreenSky’s there’s supply to just missing the contractor that where for well, I’m and be labor in overwhelming But about chain from would with you chain those transaction positive volume straight And just cash deal going would guidance can thinking I’m should if contractors, and me something marketplace your that cash labor on and on customers to a thing a it issues. are the who favor. something or pay -- Or actually just they with [indiscernible]. else? and seeing

David Zalik

going finance The that window are percentage you me the to weeks, is it takes if give weeks XX takes being used anything going weeks. installed, it to an of If explicit No. to financed But not get XX rate, a anecdote. take down up. it let X appears be jobs

used and carry a that manufacturers takes it products, weeks. of roofing XX have We to couple

it be to it XX weeks. X X constrained can products, they’ve and Now colors,

and the sales, So longer, is recognize volume until push going complete, but out. Xx takes to have when job potentially great or that’s you get X it you it transaction don’t to

record is get transaction these seeing we’re this, takes much approvals, referenced done. volume we and jobs because it is, to seeing lagging but we’re longer what So the

when demand, challenged with we overwhelmed and contractor seeing seeing customers they’re our they’re labor. less that not and chain is demand. interview by supply We’re What we’re greatly

if would X, see out in months. pushed expect and are what we the $XX,XXX to So $XX,XXX July. we’re made we normal in seeing X seeing normally over get in in volume that is is a June course, or June, And sale X instead, transaction

Christopher Donat

And I then, question Okay. guess, me. last for just

out ‘XX As because XXXX? and feel relatively does of you’re you months, but do EGIA see that I ‘XX. you thinking relationships, pushed you’re about out think activity change things from about X, or it other optimistic X of already basically to being pushed how you’ll think X

David Zalik

Yes.

very the in all So makes longer for look, us leading XXXX. including times, bullish lead indicators, adjusting these

Chris, I our funding that diverse. demonstrated I that profitable we’ve highly it for made is think, And we’ve, more think, company.

I win think we against we’ve some very encouraging. as indicators win all continued the it and leading demonstrated have can up to And really competitive that big landscape. XXXX, relationships, relates to really, are the heads

they’re got their So margin, funding, expect another and telling merchants we’ve months, profit have us advertising just back we’ve in transaction of anecdote, a to chance we on up are got volume. backlog. here last And cutting in and couple catch to just their the accelerating profit to

So the we’re XXXX. we on short bullish -- answer very is

Operator

John Our comes Raymond of from Davis next question James.

John Davis

a acceleration think David, we that question. to Obviously, transaction out an how about how versus sorry, I how does or in decreased play growth. should XQ follow implies want guide little just guide, Chris’ in it bit on up XQ? the -- increased

back XQ, more to how it this half similar even? something is it from and us saw in growth of plays As perspective we we more help of Just a what anything year? XQ? hockey out the XQ Or sequentially get with in stick a in in

David Zalik

Yes.

more go. time. October, expect say, generally we that we people So tends Thanksgiving, now we is But in don’t low you’ve we don’t What the QX to and That in flat and weren’t like seasonal for would exactly, performed improvement with last install of had remains, QX. well, after a fact to home can’t don’t able precisely predict are What backlog, the got we decade. to is people we’ve think don’t curve expect the be we know same material, of right? going the is let’s to the that something is terms what have kind but

does how take that the So more to end long we summer, they they’re different into it’s QX. catch and just to the industries Some push think seems bit up, historical to We it of don’t going supply normal. be more the than know a be think going little seasonality, right? it will by chain

it’s into year. Some are early that reporting next

And so volume. QX elevate that our would really

John Davis

Okay.

some growth So bit in you little modest those then in basis a a on and reading comments XQ year-over-year correctly, XQ acceleration expect on step-up relative would to...

David Zalik

right. That’s

John Davis

Obviously, Correct. maybe high And guide I pretty margin, popping think this margin. XX% on then it the implies was EBITDA quarter. XX%

You guys kind talked margin XX% a have term. to longer of

I there’s if the just want can credit all? tailwind go bit puts in the any and and takes has been the to the maybe, you at half of a the little But in So puts longer-term understand half know definitely of takes. margins Andrew, kind and the just change a just on been year. through of of margin back in if first year

Andrew Kang

Sure.

David Zalik

just Let profile that company, curve. every a normal comment me EBITDA year on a before the public we’re goes margin

to certainly and at been that quarter look first quarters. our be fourth the you public, tend If all years we’ve weakest quarter

So -- and annual very is demonstrating can certainly we’re we’re it excited we our focus there. get margin, that EBITDA is

and third margin. the is Second highest always EBITDA quarter

you So in have the and third quarter. second to quarters biggest your tend

and first and to tends you third And quarter in the the so is to and second only that want to peak us and in for natural that? Andrew, margin anything ebb it historic add fourth.

Andrew Kang

we right. I the think, improvement the cost as where revenue just as as David, you’ve And second we have, sales this financial in impact our model, when benefiting the volatility well be funds, we kind guys to sales of benefit able to diversify unpack of really lot And do. And a loan the guarantee. funding said but the components seeing funds. talked also we’re know of No, I I real last optimize that’s year. operational also, when was cost we FCR commenting of I our saw sales waterfall seen We of you loan I bank of specifically, was around both the overall what think in to costs of in and to our But convincing important prepared quarter areas mentioned late our cost strategy. around would had reduce absolutely remarks, the we very about my loan leverage we

well as that the the should in funding as, leg pricing an improvement So of I of model. say,

from fund dimensions improvement we’ve to quarter. that steady side, So think cost multiple of seen of of the I this reflects revenue the getting And cost a of side, really that kind diversified saw state, QX, in execute of solidly at now us the you expense QX last model then and year, of in building end kind more now. to where to be able

a We’re run kind rate. of at steady

So in really impact that’s component what the of the seasonal quarter. quarter, portfolio to is peak a Also, performance. I the mentioned, to think second second important similar the David like

strong our benefit So we our payments. incentive a see did through bank waterfalls on

And diversified strategy sales really funding strong into I quarter strong the a the its -- stride, translated from loan and along just with so think very coming a credit the really perspective quarter. model, hitting collectively, has a

John Davis

Okay.

long-term of to no profile the kind to margin mid- fair say to business. of change it’s So the

were thought to you You’re initially? just than getting there quicker you going

Andrew Kang

say keep I’d I agree we’re I’d that to opportunity getting you that but there going. quicker, there’s say with

John Davis

I Okay. documented one well the higher given couple for rate. the solar of guess ago, last we’re of a years of And quarter. on X me. business it’s a headwinds David, kind then kind take the pretty

I -- range take they in the still So believe XX% of kind rate. was the just it carry do curious,

healthcare could elective as any on percentage the kind there. then of get where just update solar could we are business? a think big expect and you of the So pressure. lastly, some upward And How we do

David Zalik

Got it.

on see one X least is What thing kind of of and about sheet, you’re terms this more no example, and at There more and is be balance $X create waterfall. on get We should But billion that would originations that we’re are certainly it rate. FCR. more less will There great takes relates deal to structure. We’ll margin. run our for it for even a solar years it. -- as would think time, -- to waterfall. be insurance expect to is that a of noticing think and be expect to GreenSky company to complexity the us very lot business bank X will as have simplicity no solar our if volume. originated is is annual contribution transparent. we transaction to, So originations year financials. about And not excited transparency or to I X% similar would there more over And complex We a a in clear

billion, And would we really simple. $X originate it so if be

You take then there ongoing funding earn volume, and can get we transaction and plus fee, servicing discount partner, be recognized of X, that origination, clear be out of would and time that at we’d would no volatility. would

So very, think we that keeps it very clean.

be And in of at subsequent there just great but it transaction that wouldn’t years, the a be the fee, noise XX% net flow helpful? would of so negative cash the economic the time origination. Is

John Davis

And healthcare? elective for. looking I’m then what exactly That’s just Yes.

David Zalik

expect we’re very part meaningful a of And to continues and up, business. excited healthcare about elective to we becoming and that that. ramp continue to And start ramp our

add year. XX% we’re enterprise-wide we’ve John, hoping that home now and business, only business, quarter grow I about our the think, in us, healthcare. in million to not gotten front we a but the of lot to do when originations a of growing billion of opportunities to on just fourth recall is Please XXXX, and I’ll got, of mid-teens. your now healthcare that had improvement core ramping $X you’re So solar. the to in $XXX It’s to improvement difficult home

keen. some hope the we’re success And business is leading that of that next sort accounts. fourth the year. having to this with for We’re enterprise procedures range. large not demand year, quarter I healthcare XX% great share get in going gentleman to The for by us is

it’s but for there and this contributor But effect it. we is a market the to do So to is matter up, market a the for there certainly like we’d execution. some catch and multibillion-dollar just of have us, denominator see be

Operator

Instructions] next Giuliano comes [Operator of Our Bologna Compass from question Point.

Giuliano Bologna

a you of Day necessarily I not driving tailwinds obviously into I’m from there The range pretty is getting guidance XX% guess that see ‘XX. XX% you curious before of recurring. that Would happened in that is revised that, jumping next optimized what you you that got number XX% right kind come you’re of it of of could cadence EBITDA margin think an of think are EBITDA for perspective. little to do be implies scale XX% at Investor a you you some of into possible from obviously, kind about exceeding which and range. that a into the different or right perspective up? earlier The And Or back of slightly benefit year year your probably to similar would kind are year, are this reversal trajectory little EBITDA down a this -- margin bit XX% last kind bit even -- was would it’s XX% year. perspective? What They’re going guide kind topic.

David Zalik

Yes. We don’t see to natural the back than up go seasonality. it’s other going down

painted, start making of of we that way there’s had we the next we think billion first we’re early volume, us think, year. plus and a clear $XX later, So $XXX I quarters Investor here we our we’ve the Day investments on plan in continue can we’re in And get picture we’re is will and just what in momentum in demonstrating to wins margin. at very end ahead, few And upside. XX% us a million to that January that think that X-year profit, a that because year obviously and the this impacting

great very and we’ve great we excited, got momentum. we’re results and So think

Giuliano Bologna

That’s great.

Andrew Kang

of understand necessarily to comment, say just just that making because release. seeing would aren’t David’s the I’d I add results any you sure of sort today we’re Giuliano,

described pretty at a and point, the to that. generate incremental in provided, improve the given spot of is have be feel can upon where we -- seasonality dollar every coming as over to course I gotten a acceleration we’ve think guidance going really, release P&L. of mentioned, is that be revenue as a there year. we’re will I But cost before, back. an it’s come the now a we that much year I something to the really, to then David could helps. starting point stable This that feel of like more the good Hopefully, volume that And we

Giuliano Bologna

line very increased top think of -- you’re should better sense this sheet running I your now that there to the cash you balance adding use last I margin, kind fund how cash you’re you from of much you curious cash that end profile. running if think point? at deployment to the of the That’s about is guess of really of best kind about that cash or use loans margin question the a a be the be since helpful. perspective? more have year. a to position, if Because liquidity only it what at Obviously, facilitated makes from use

Andrew Kang

-- say ahead, go I’d David. Sure.

David Zalik

balance So And are we from There’s cash. from seeing insurance What perspective. participation And you our that. recognizing diversity. generating see get it efficient companies. of Thank incredible a can’t really fantastic to lot any than and demand sheet. need more don’t we for is that just we’re

we of be growth. continue conjunction options, efficient with all we runway time. partners, And in at certainly conclusions made we looking accumulate to this in any amount as terms our we’ll bank So have tremendous at but seriously haven’t we of cash, think a

Giuliano Bologna

expansion potential to they projects refis projects can recently? And for projects. I loans you being I’m home kind the improvement side I’d the types have curious used that good. offering there’s you’re that this type or out this could market of that see use are impact that that sounds of any used mention competition thing or that The that any very are or a even just only not mortgage of been side? about interplay personal you’re mean, necessarily on some of discussion seen a be for unsure specific on renovation more perspective -- cash suspect be seeing you to, loans, greater That of if from the

David Zalik

the better what No, for all. paid directly deal is get at than there that credit they that. seekers not What could a to at much allows But our a or improvement to you’re website. loan And the subsidy by is generally platform why. our personal contractors clearly a any a product supports the bank home that and here’s advantage data get consumer is referring remember, has

it’s It’s transparent merchant, the instant, highly to paperless. the consumer. subsidized it even So it’s is and more by

we than loan it and but personal around consolidation know, more We not seeing -- have don’t an and as been loans So we’re important it as and anything. you intersecting see place, popular have very certainly see with commerce.

Operator

of comes Our next Citi. Cyganovich Arren? question from Arren

Arren Cyganovich

Just faster Day, cost on the waterfall changed kind and X.X%, running X.X%, similar you’re bank the just to revenue I’m of of loan of the at of it’s your remainder kind and you’re as life example the between because has sale that of far is just for Investor running, shows and At thus being And revenue. the that understand guidance out cost below least but of laid you -- maybe two. of of the expectation loan, just around revenue the which overall? trying XXXX, in and differences the

Andrew Kang

I Arren. think,

David Zalik

go Andrew, ahead.

Andrew Kang

I improved, relative Arren, availability you question, update I to what think capacity the see yes. were If view Pricing has answer is today, then. answer improved, that think we Yes. to to presented would short increased. advantages has we your has

cost the think the strategy loan And the looking that together might perspective. put in with we’re view January to and would our from next sales that’s be be I to in component that of So you something that improved share call. able reflected

Arren Cyganovich

next something is of I is issue, or more expect that structural through Okay. current that’s a that the years? you environment will be several that mean

Andrew Kang

That in had sales. It’s billion place. had definitely January, $X.X agreement have forward you now structural -- We loan prior to flow recall because structure. in we some discrete done creates a

that, as discussions funding more We And to other additional on also, still sales partners. getting bank we’re we’re and way, from capacity doing by more discrete our And demand having are sources. in loan well. addition requests the

January accelerated are the quarters. in thinking to having to where I are initially really, faster is those expected we we a think all where of I within pieces couple structural pretty So much than had today, state about started again, what steady that a

Operator

this Zalik have closing. At questions. back further over currently for hand no Instructions] David to time, [Operator I’ll we

David Zalik

for very loans want be caused I gotten There’s one to just additional some messages. everybody, released. There’s no our you, books no reserves reversals. been or to reserve have onetime that comment. no on joining that. We’ve like Thank I’d add us. clear that have there

been of company. rate improved So the the profitability cost in funds by profitability and has driven increase and in efficiencies

you. underscore wanted forward to I our Thank you, third that. everybody, for Look just quarter to joining So call. Thank us.

Operator

all you today’s joining Thank call. for

have lines, a lovely You day. may your now disconnect and

GreenSky (GSKY) 31 Jul 212021 Q2 Earnings call transcript