PRG - Earnings call transcript Q3 2024

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Operator

Good day, and thank you for standing by. Welcome to PROG Holdings Third Quarter Earnings Conference Call. [Operator Instructions] Please note that today's conference is being recorded. I will now hand the conference over to your speaker host John Baugh, please go ahead.

John Baugh

Thank you, and good morning, everyone. Holdings XXXX PROG Call. the to Third Earnings Quarter Welcome

you President Michaels, Executive Chief Joining morning, a which of Investor issued Steve on website, earnings Holdings' of Financial already and our copy Many is our me are this Garner, Investor PROG atprogholdings.com. Chief release seen Brian Officer; Officer. our available have Relations and

Steve? priorities, for of full During our the capital fourth comments to actual for regarding including continue allocation to are to financial of the to earnings be forward quarter year statements. obligation in non-GAAP that the measures, and company's for included ability with and results call flows Michaels, our of risks Officer. adjusted certain On we forward-looking our operational to company's this forward-looking including these performance Chief performance. referring not EPS cautioned that, the company outlook looking, the portfolio President reconciliation call, quarter detailed measures release. provides to year which tables uncertainties, today's to our Leasing PROG to financial other which GMV cause certain call, affect The believes like from in update prior for are understanding expectations statements with assist and we measures undue today, which I'd including for Executive over the our With operational of meaningful to full returning We health have for been such XXXX. are operating and items results emphasis outlook revised periods no to the regarding help place comparability on the we undertake certain measures full XXXX, turn subject Holdings' our adjusted the non-GAAP in make and non-GAAP XXXX differ them statements. fourth our any segment and will facilitate will and our companies. These insight contained these expectations and to make materially statements our be the and capital to may and Progressive ongoing investors those write-offs our performance cash comparisons year EBITDA with into of provide non-GAAP Steve and shareholders. Listeners all XXXX which could

Steven Michaels

Thanks, morning, as insights joining John. full provide and we thank outlook. you discuss share to everyone year and third quarter QX Good for financial us updates our results, our into XXXX

expectations today, great GMV revenue, we growth surpassing earlier outlook. EPS the end high and another non-GAAP delivered for quarter, earnings approximating announced our As and diluted of

line of balance strategy top and we Our and highlight retailer strong successfully team. our customer maintained execution a relentless of QX by focus the results effectiveness share. our experiences, on the and enhancing both gained With momentum

Our direct-to-consumer to customer fueling continue engagement, efforts deepen growth.

with Progressive Additionally, for tighter external for higher I'm of to accelerating at XX.X%. factors rates GMV Leasing's in consecutive our the team coming Progressive in GMV from proud of the GMV incredibly contributed delivering approval stack segment. Leasing up credit growth QX such also lenders quarters as QX growth the

incurred strategic key accounts. higher metrics. This regional performance and focus driving both Our grow, pillars expand national growth has enhance been version on fueled is meaningful improvements year-over-year application the and and across across per by door productivity

our for means X% excited QX growth QX, return million, partners about our In of $XXX.X this we achieved are our We compared shareholders. XXXX. consolidated and team, what retail representing to revenue to growth

in margin reached million, EBITDA performance disciplined $XX.X growth and driven by portfolio resulting adjusted Our a supported by consolidated and GMV XX.X% stable spending.

remainder XXXX. omentum this expect carry Looking the to of ahead, through we

period QX a year leased as asset last the the gross or is GLA end year. the outperformance has of same which GMV key led of indicator increase of revenues. balance future compared our throughout X.X% to Our in the to XXXX

close with This For and In successful year started QX decline a And GLA X.X% XXXX. levels. in QX entered we we GLA, for of our us at write-off the positive year-over-year shared flat. rate pre-pandemic balance of trend a quarterly QX consistent positions to X.X% well context, write-offs the mark peak QX, in that we in we July, with X.X%, expected write-offs. remained XXXX our to

short Our to dynamic swiftly decisioning customer posture allows us and to cycle to portfolio X-week trends. adjust supported X- by a health feedback

us rapidly fine-tune models approval enabling our proprietary and incorporate real-time Our machine amounts. rates to decision learning information

will X% confident details, of our are I'm Brian targeted X%. XXXX maintain further within annual provide While to to range write-offs we on track

focus that progress growth significant driven to GMV and expand As growth regional signed we success our the enhance profitable Signature, these on our positioning our part American XXX our Execution our with achieving national areas exclusive at fuel pleased grow, top and essential market and top strengthening on targets retailer priorities. beyond. our further These XXXX our year-to-date forward. I'm will remains made pillar, the XX strategy. Under is and of Inc., have moving long-term Sustainable accounts. financial strategy, in a in for XXXX core today's we've our our of alongside X-pillared a list, share furniture partnership to grow efforts

several our growth partnerships, across regional through driving existing strengthening in We're quarter double to and the penetration. to Our growth and customers, new customers marketing acquire investing direct-to-consumer another low awareness in delivered business GMV brand business dimensions efforts e-commerce through impressive targeted new expanding include engaging increasing partnerships of digits.

GMV Leasing willingness to delivered of focus all with contracts leadership with QX, extending further contract investments renewing renew deepening on us long-term At maps. both of exclusive retail is have give record that and track and is Our exclusive road leader. our and significant and integrations ability the half partnership over the in exclusive as position enter our solidifying our the leasing take our technology agreements XX% retail and sales, our with value under under industry. to initiative We key the partners pride us firmly multiyear in great to Key in and partners, prioritizing Leasing Progressive our contracts Progressive XXXXs. end their approximately market GMV of marketing into of with Progressive a

our efforts leases As XXXX initiatives, sales, this platform, the our app by in up to shop. wherever like about initiatives as taking e-commerce platform traffic QX in mobile complements launching material as improved PROG with the We year-over-year. as multichannel roughly the from advantage Leasing well product advancements to of the delivered channel e-commerce experience QX our partners of QX to tech activity our customer and allows as I'm XXX% New, anytime, additional growth customers a as exceed significant number for marketable XX.X% total shop branded QX. part investments choose rates. of continued through Year-to-date, two active The reactivated. over customer our PROG These anywhere of Marketplace conversion segment integrations enhanced sales and increase is total into product XXXX have product track retail however has to of for a for GMV we traction the marketing to progressive remains to they and XXXX. Prime database XX.X% coordinated as marketplace completed segment direct-to-consumer is Day gain X partner GMV which focus double XX.X% to execute growth and GMV promotions Overall, offers meet to bringing driving target and X.X% well in GMV customers and GMV on as on direct-to-consumer and our excited pillar, growing. E-commerce leasing growth, Progressive marketing in and engaged drove campaigns drove customers in Leasing. Simultaneously, opportunities Amazon with our XXXX highly of end Under to custom traffic. Progressive seasonal drive customers them in incremental as contributed and the year-over-year groups: QX. repeat we strive QX of

as clarification, each last to funded define that unique strategies reactivated and ago. needs group's to months customers a lease For XX our than allows us This more marketing we segmentation behaviors. tailor those

benefit try we personalized while customers introductory purchasing and gather patterns. from new instance, their insights as to marketing deeper more For incentives product repeat into require our customers information

and to maintain customer New respectively, and customers in repeat reactivated QX, year-over-year, contributions approximately XX% XX% increased GMV. while we

our loyal share value is who focusing customer critical our of segments a a driver business. repeat lifetime working all cost-effective we underserved of of in customers to new repeat manner. higher Our By addressable expand reactivated, deliver a and retaining ability while larger are base, X capture on market customer a growth across to our

tools rolling an inquiries for solutions, enterprise-wide benefits enable information. out AI and related consumer-facing efficiency enhance assistant and We We implemented customer both all with and self-service employee satisfaction. to operational that are policies AI to AI-driven innovating

immediate assistance, driving our experience. I a not healthy take and entire to our consumer-facing also designed for maintaining through team in only growth, remaining embracing first change a Additionally, a short-term to future stage customer in to with program step enhance satisfaction to set providing their assistant disciplined our AI customer we pilot by the portfolio results for tremendous our thank spending. efforts but transforming key support want moment launched marking

of work financial the today tomorrow mission, a and better creating possibilities Our as performance unlocking a of dedication their director empowerment. is through hard all and our to

outperformance partnerships, Leasing Given segment, now new reflecting GMV marketplace. expectations. the efforts our being outlook and enhance onboard new deepen XXXX through technology, to our expected both earnings momentum for driven retail partners, exceed update customers this and performance to increased revenue This targeted Progressive pleased our by attract we've year, existing and we're year seen our with PROG expand marketing full prior to is

of dynamic to we've low we we expect monitor range driven while fourth environment. the consumer positive quarter, growth For single the to in a double high observed be the digits, GMV momentum by

year holiday into Though X-week of a far Black on our Eve. XX% the quarter's in carry the to the historically we We where remain and position front October, as Christmas period for we're time, generated at season, in off strong of the in year executing with momentum approximately this us So Friday of XXXX. focused GMV all-important in every have still ourselves strategy this the we to success to end spanning have start.

the through details topic priorities to I'll and and Finally, excess results for and of turn fund look dividends year opportunities allocation, and outlook. return expect of remainder CFO, unchanged the to repurchases. more Garner, growth, our to remain for strategic call cash Brian share QX and our Brian? on on shareholders continue to the we now over capital M&A

Brian Garner

Steve, morning, everyone. good Thanks, and

anticipated high that quarter came exceeded team results like EPS Starting are with the high that results. XXXX provided single-digit with late and through range in you segment, I'll near our and an diluted successful we GMV for our in pleased delivering exceeded begin We expectations report year-over-year thanking quarter. to to non-GAAP third end earnings of breakdown the our a July. our I'd rate. Progressive for now of expectations growth detailed take increase by Leasing another XX.X% more surpassing GMV revenues,

both we Steve strategic rates. conversion and successfully implemented As mentioned, have multiple applicant that boosted flow initiatives

progress we have believe this ahead, QX, momentum. several additional initiatives in for will which sustain Looking we

materially. most Our GMV outpaced larger growth comparable of retail again partners store our sales

we supply Additionally, credit of benefiting of environment from through above end least tightening us, persist we the are at the and this to XXXX. expect

last this a is of a we balance, growth asset marks a first driven larger of the As highlights which leased since revenue, of growth. of one year-over-year quarters accelerating the with by quarter year, period result, growth than now the future primary portfolio X.X% of same QX higher ended quarter the time driver is size. This X our GMV consecutive that gross XXXX the

improve We in of our remainder revenue the contributing revised to implied the to growth balance outlook. year, the expect GLA through

same QX, our higher our $XXX.X XXXX in to driven leased QX $XXX.X for to in for by reflects demand period and this GMV higher strategy period to last of million partnerships in for with the our the than XXXX, for write-off for portfolio lease targeted growth our is due The was We growth our and as execution Leasing the XX-day the Leasing segment expectations million remained in for provision sustained year. exciting growth performance of Progressive within however, from X.X% annual revenues delinquencies success the QX range. is well merchandise Progressive strength slightly early QX believe This an compared purchases strong QX increase moving which product. write-offs lease [indiscernible] the of effective momentum of forward. The portfolio positions return higher our our and increased the period. it consistent the pre-pandemic us relating the of in X.X% to provision to

This average continue while confident allows rates X are us to supported every We which to real year ability our dynamic to to the months. rates. a anticipate in maintaining range X target growth. customer growth to in We trends short [ over adjust time higher-than-expected on manage lease the day our full turns X% [indiscernible] decisioning of with new early to by within amounts bolstered to still duration our historic customer portfolio ]. XX portfolio, by write-offs X% in be models, swiftly purchases lows compared health that and elevated portfolio XXXX,

expected, XX.X% approximately last $XX.X Progressive QX points leases As QX were in X.X% million gross our a or $XXX,XXX prior margin basis decrease in lower year. same to million $XX.X than was XXXX of the of of SG&A expense compared quarter in year. XXX

expenses decreased year-over-year in XXXX XX from XX.X% of revenues by As to of points a percentage in revenues XX.X% of QX basis revenue, SG&A XXXX. QX of of

investment our Despite our these EBITDA of primarily in $XX.X due QX XX% purchase lower marketing Leasing This within by the measures, million gross in restructuring XX.X% QX XX-day this write-offs Leasing profitable in headwinds compared with pre-pandemic is and levels, EMV. of actions have to and partially START for technology this sales, adjusted we QX to target taken options XX.X% discipline. SG&A to was in to a maintained approximating year. drive cost-cutting the and offset Progressive Adjusted margin XX% Progressive margin for As was annual to revenue reminder, XXXX, basis XXX improvement driven points XX.X% segment. is by of margin of EBITDA

their growth, million revenue Turning of year-ago period. purchase revenues the in consolidated of to by same and options increase results. segment. Consolidated to the XXXX Progressive along quarter to million was year XX.X% and customers at Leases with exercising in million XX-day the $XX.X was $XXX.X million driven EBITDA adjusted $XX.X an QX GMV last $XXX.X compared XX.X% in compared

the balance of remain cash common $X.XX during stock our end adjusted million a And of price quarter. the months a ratio third We in resulting We XX EBITDA. $XXX in quarterly per cash X.Xx on revolver quarter paid XXX,XXX leverage We repurchased our debt a $XX.XX $XXX.X share. of September. at and we of sheet. in Looking our quarter, at the share XXXX of dividend at gross of ended with million, of the net average weighted undrawn trailing $XXX per shares million

million remaining program. recently $XXX.X our reauthorized repurchase have million We under $XXX share

As persist consumers will affect delivering anticipate credit segment. to we we benefits the year-over-year about in us remain across growth Progressive single-digit our the maintain rest year, overall its high QX the strong. of continue of positive to our the trajectory, that QX credit the look supply Leasing GMV saw pressures spectrum, the contributing we will With finishing our we performance. from the year double-digit ahead, optimistic a tightening We believe economic through low above for to

growth along increased and improved GLA X.X% GMV GMV This flat the with outlook. QX into up and into benefits revenue going year-over-year revenue is balance, in outperformance was QX in which QX. improvement GLA, Our our roughly XXXX reflected our going is anticipated with

our to to QX Progressive and have primarily the our due our difficult within been target consumers remain a into pressures to for from purchases expected to of the number write-offs will We annual is merchandise for decisioning Lease gross is within year. target to provision the remainder of trends performance choosing full the yields be for average comparison for financial lease year X%. exercise expected the liquidity challenges X% customers facing XX-day of forecast. QX believe portfolio portion a our model year our segment, leasing for last these of persist Our range to XXXX incorporated margin and deliver below their

SG&A year to for line expectations of with as disciplined segment. approach Regarding Leasing the remain revenue, percentage a full our on we SG&A, our track Progressive deliver in and are maintaining

consumer the difficult credit company's the outlook for be material assumes base; to from to from I and for changes and earnings above are effective in impact with the free our rate us $X.XX of and head our growth tightened non-GAAP decisioning $X.XX goods; over positioned material million will for XX%; us; to tax the operating range This soft a consolidated benefits we call additional our cash this for Our the with performance rate has range $X.XX. consumer extremely pleased billion deliver the in EPS well no an demand are set no we environment as in $X.XX share adjusted to operator for no into posture; in shareholder revised continuation we repurchases. In XXXX up outlook the for Combined unemployment approximately turn year, XXXX. calls revenues billion, $XXX value. range of flow EPS summary, from questions. team's with to for in revenue meaningful changes leasable non-GAAP EBITDA $XXX of Operator? million, generation, of well the to which a now

Operator

from first coming the [Operator with KeyBanc. line Thomas question Instructions] of Our Brad

Bradley Thomas

the a over just that token talk momentum kind and sales that's I country follow Congratulations on and little next you up have nice GMV. customer from quarters? particular. topic. those Signature, you're about over Can Steve, seeing that the I customers of takes underway same some or in talk puts the a wanted store GMV on about that impacting and of closures now bit if how of happening you digesting some larger thinking the And in the you American Obviously, could what are wondering by how -- you're GMV that exciting was in you're to few right there. and [indiscernible] bankruptcy first about

Steven Michaels

little our the it and kind above but that actually would, closing expectations, marketing and in promos Yes, outlook a the a in our anticipating. we were we're quarter little there than was quarter for some we bit the little campaigns Clearly, pleased thought of performance Yes. performed Thanks, our year. a Brad. GMV were maybe above nicely the with out expectations better played bit way out the

And the Eve. It's so -- always from it's but going out but XXXX that that it's because in very much such press with American Signature, of of really -- October Friday we're difficult I where we as as -- year calendar about and pleased period between acute this starting you partnership. all and we're a to remarks, that mentioned for strong, launch Christmas that the very prepared release, to season Black because year, being late it's impact the of it's is And and QX an in GMV holiday that. in standpoint, not predict and said XXXX. proud But excited we're the mentioned tight

commenting not as as We're top to our to Lots, quarter. certainly said, of with and about As really a to the it's on the marketing and the dynamics the partnerships they've credit it XXXX, bankruptcy to We plan stores, it certainly relates retailers. good will well them well. is GMV. relates a well the Big XXX number -- QX, but really it that's waves of relates and and with obviously, basis partnering as partnerships, lot integrations known, as and for point executing, good for headwind their to impact The believe, funnel that certainly. accelerate excited to they're it's be above got us there's you of We've XXX probably starting helping closed us, supply

So there's and takes. always puts

on create supply side. Some well that the little credit we've bit customer as with the net-net, referred of tailwinds to there various pleased as stress a as help macro to. out from we're helped the we But

Bradley Thomas

the in is Great. That's the extent side stretch more that customers follow-up I consumer equation of part know that if write-off And on Steve. you. could a some on the just the U.S. to sends the to helpful, ask

case Do a bit XQ seasonally is you standpoint. XQ? the from to still write-offs? to will think them And be that loan maybe think range on what you in I highest the here in quarter take think that do little you degree your need typically for a the decision

Brian Garner

Brian. it's Brad,

and as from expect payment during would have reserves what aspect QX you look looking to here. the the we a of at typical we to tax season strong Just in that than And it, what you're step high year. to cash forward QX seen that collections down with actually QX. that's stick your different not in time, reflect seasonality Normally, performance

the got [indiscernible]. down. the from we to a step X.X% you've expect on couple And write-offs, of by So

aspect funnel, referred we actively to You've got trade bottom little down stress at in are remarks of let indicated that Steve the of we a as of of we got we've our bit that speak some managing and to and it. this decisioning end I'll the prepared the

Steven Michaels

as it data, react monitoring very posture mean and I seeing the a so say, we Brad, quick quickly. we're what that on a always from standpoint, in based have like Yes. and quarter constantly can we're throughout little We adjusting tightening the decision feedback loop we we of the for some progressed. wasn't opportunities like the pockets and bit. changes. It do third kind terminology looking as trim just to I'd quarter was did to wholesale use And a scalpel because

and we is in So lower that our we to last And and on see X as to annual last in rate of we're points as think ended X% portfolio were that time been squarely range so for an X% monitor the or years basis we've we sit confidently here the to XXX basis. we performance what necessary. year. quarter XXX probably continue we're than on that today, this we'll and approval

Operator

coming next the our question And of John Jefferies. from line Hecht of

John Hecht

good a quarter. on Congratulations

increase Or coming understand the should to write-offs about? during think in write-offs. some income income of bands? there cohort contained are higher other dynamic that First we customers, maybe some But is I'm and is the more the is from early-stage is one, to quality, a newer higher think I the the there the whereas EBOs EBOs it dynamics trying -- buyouts of the -- the just quarters that the I straightforward lower

Brian Garner

Brian. it's John,

thinking I right. about it you're think

that tend if seeing surprising their to check is isolation. What to That's credit keep their a in they propensity higher write-offs. with the look early a some indicators not And stronger Just in they we we're on specifically down a average, given buyout. trade with have that profile. do of population, XX-day at

for have skew have population. margin propensity before. days tend some These lower so new. it have existing margin consideration customer largely here as but favorable also at we that about seen as will going gross you We're very looking to from we've tend higher got to that new margin customer customers And not And XX a They trade that's you're down versus are strong. to because a a think customer. as very repeat. slightly an from standpoint, customer have lifetime to is long-term of the be be value The prospect you opportunity this prospect this

And slight so a of initial, would a you pressures some It's population. relating they're might see and I down say, trade the to gross majority margin early, not story.

of And next as play so -- that I'd and is keep relatively out it it's characterize something but small is it but over quarters, updated it course may that, folks few small. we'll on the relatively the

John Hecht

new very question merchants on by you you you versus can -- existing That's it another GMV Okay. but mentioned then growth. helpful. I the And Can merchants? just bifurcate if this, apologize

Steven Michaels

say platform. overall, we that, that we we don't No, a was give our growth saw XX.X% that didn't and the regions did across But John, say it generally out. we nice and

John Hecht

final on there merchant from and Is in any update Progressive any Okay. adds ] revenue that for [ And pipeline a then marketplace growth potential question. initiative? the

Steven Michaels

a with to had up excited and pleased year-to-date, of We're kind marketplace over this Marketplace. it out year put Yes. for PROG double. Progressive earlier and we with XXX% guide It's

our to in important are and nicely experience and outperformance, And with, they in us the tech continue really customer the that that to sophisticated combination bit also are marketplace. checkout sizing a to experience in teams quarter. targeted and our got not retailers really very direct-to-consumer that look proud motion. the our more we're we'll super kind the more get So conversion working getting that. ahead on marketing forward to improving this simplifying for have but customers. the and helping of XXXX, -- give we're drivers because We've -- partnered growth we're And checkout product But the we and efforts on little choice partnerships in is together, we're participants we've marketplace. affiliate clearly product, good of probably tech that color are of of marketing some that are to give on Few

Operator

Our the with next question Anthony line Markets. coming Capital Chukumba of Loop from

Anthony Chukumba

quarter. of Congrats strong positive quarter, lot in on a a the signs

to that's to lease merchandise So kind that, questions leading that's buyouts, as great have for waited question before. a see. to higher We up time related that. of trade customer also, a the a which come a you credit saying less said down, in long result And XX-day and seeing makes of certainly you more is couple which are a and or -- well-heeled a likely sense customer because that but more likely you're write-off. is

seeing guess clearly if trying merchandise I'm lower to it's I write-offs. So trade be it what is and down out is happening is happening also gross and figure that impacting your lease margin, shouldn't we

that understand just wanted sort I of dynamic. to Just

Brian Garner

dynamics. Brian. Anthony, Two

rest that's a down be the across indicated same of just seen. strong credit seen the they But a have has not slight to the trade generally at the delinquencies from statement in trade increase the overall. the time, board And a our factor do happening, profile. stack in down prepared remarks, we and unlike is we a So tend the population. credit That's independent portfolio of as

we to is that job X.X% at point stay were and our So where top decision the and for on is QX would pre-pandemic just QX. period of same for monitor I accordingly. that it out

a not see is ]with expanding we is QX. we're that that it [ into or So uncomfortable level

as end kind if we to changes within the viewing population, the unusual. though years, what's bottom pointing control But We're course the we've here. level to some been last relatively we'll it's intend that only not few but downs, iterative ability that as do the number that, normalized we We're also levels down. our of a perspective to expect on have both weakness. we're we And P&L of small step dynamics the at the our So the strong ups and the funnel, both and so. of decisioning, at and level benefit is write-off hopefully, at out make demonstrated observed the in from do of in trade-down a

Anthony Chukumba

it. And answer, fair update guys super a the That's you some obligatory retail Got just partner question, specific large of anyway. to pipeline? helpful. enough. ask I'm give in Any going then it but and No, never terms

Steven Michaels

you that disappointed I ask Anthony, Yes, would question. if be didn't

you. on We're Buy the a ASI recent We're Officer, part Best least with [indiscernible] and think gotten that Progressive up representatives Lowe's some nice the the how pleased not momentum. Certainly, specific are we've how really was to with thank for and the I Those panel retail of traction next of financial So partners inclusion and at a with year-to-date. Commercial mean, that audience from [ land, they profile win update. is our the Yes, continuing. listening of can ] the with that We partnership conversation. MAG with are that. a help really partnering helpful some our setting big things the Chief nice in conference

progress, the nothing by to encouraged but specific on. we're you So update

Operator

And our Nguyen next TD the Cowen. question with is of line coming Hoang from

Hoang Nguyen

the And quarter. congrats on

And it to take should Sorry a I We range? credit charge-off talk being a mean inflation wage the trend guess, consumers little a to that middle know lower-income I back which maybe you while, growth the pressure. base what But theoretically side. that you serve? for have the on I for, delinquency would help of mean, I the keep for about guess, beating bit I has follow-up.

Steven Michaels

the give just not mean, the right? say stick I when to and range would I start, now. to like X%, at we range that are But landing the the of add. X% the where of range we're X%, in is trying Brian I'll middle can we just

range like So provided. we're proven adjusting this over things. to we've constantly that can we very we and the feel And portfolio that time we're manage We comfortable.

is range is the The of don't I want consumer So North or also a and that Star. impacts, a impression from X% lot from vertical to it our give standpoint, shift. standpoint, whether fluid mix retailer has be a shift

against So expecting would the -- a just X%. I guard

I comfortable of consumer, we and consumer-exposed as mean, far across we're delinquencies. there's lot So are of where stress the evidence a portfolios as been

to line, be kind of not but rising, we're some in that are DQs car DQs we're first which well. might And so it's results ] of different or some cause in seem could providers. the -- the quarter certainly some be as not And early-stage for that alone -- [ of battle. NCOs in seeing

trimming controlling the continuing some in we're we're trimming, to should that doing the but we're control so -- And confident appropriate -- be portfolio. message

Hoang Nguyen

And maybe follow-up Brian. it. maybe for Got a

in seasonal I your tends looks be down guidance, it EPS year. and stronger think than new XQ the to guess XQ implying a this I seasonally, like performance XQ. XQ you're your versus given

talk I And you about drivers that? maybe mean, the of so can

Brian Garner

bleed I and QX we've hard encouraged thinking as as production the sizes we're Yes. here, into that profile revenue is going to think the remember our go But last It's to back by have normal it about into generally, the going earnings we're increase. had. that we GMV QX, portfolio

perspective strong. from is line QX looking a top is So

We a write-offs, to I percentage expect the as as indicated, from of step X.X% down revenue level.

seasonal then just QX variable aspect SG&A increase production assist and keep GMV So in forward strong going from to be some to But launching indicating, point a a as up. costs spend into of looking And you're an a our of those that us in check. dollars we're tick there. overall, tied should of we'll XXXX. There's good to

just This what the any guide. anomaly course think gross So EPS and margins in control, that's not a portfolio spinning we and will is resulted be ordinary onetime into incorporated larger kind cost what's with outlook. our there's good off of

Hoang Nguyen

outlook holiday this And promotional mean, for I you the guess, last anything different conversations based mean, with are Got season on your year? your partners, year it. of in early versus I seeing I terms

Steven Michaels

starts I I early, because retailers came that well be anything customers plan, are in some change probably seems other from planning been earlier last saw think season but as in more year it needed it's holiday credit it And probably going cases, our to of always months and to probably promotional and partnering mean earlier. I in a for holiday start of -- calendar the pronounced for like and will that We there providers it between us. is them. with going a Christmas, more fairly provider there. we've don't it shift [indiscernible] payment think promotional activity. standpoint, Thanksgiving and be that will and primary as holiday with the for benefit that

in good but demand we're feel we like some our retail like a underlying position, inflection So calling we're not categories. in for

trade some growth coming of the and the that GMV is talked about, Our from we've the down. initiatives things

Operator

And coming Raymond of our question Giffen line James. next the Bobby from with

Robert Griffin

good quarter a on Congrats here.

drive this me Just So it your middle a the XX-day in that or is question when towards this the what healthy What's just of product? the stay in XX%. mix consumers trending whole for continue if pathway is upper right I on kind guess sense growth GMV of the using the a of we are of as is long-term function if customer EBITDA to could that's guide, growth first what about something GMV control? we at end? Is upper the path. more so healthy it the towards end you quite think kind Progressive buyouts Or just a trying now get kind

Brian Garner

Yes.

I think Bobby, Brian. it's --

disposition of customers be I to what the is been terms margins. always this with EBITDA always mix on through business. that's overall a going think big say I'd their the there choose the is And in outcomes factor leases that in

we're long see to revenue, for so days. as to higher speaking, you over for operating with generally opportunities XX going shift a you're slight propensity leverage And some grow term. there the But have starting some

than business to growth to think mode to high rather the -- the I us end. the opportunities us reinvest ourselves push and ask there initiatives -- are we in margin internally is of harvesting have there initiatives a and towards seeking question kind for

like -- But all I think That's we would philosophy the first profitable and ability GMV feel higher So a for scenario look GMV lean to else opportunity growth, long think as inception. be I margins, our as what in really of into time. of being we've we're equal. the to been going our course growth there since got that's

Robert Griffin

that's lot that cash. Okay. not great is and say of It's XX% yes, a generates not And healthy. to

get the mix. of just what's customer versus in the dynamics to trying would your a control what Just of -- sense

And the that. seeing from categories, credit the Are lot What the to actually things? at of like appreciate that took down the they you guys as I down. space kind So over maybe just side of just then your out Steve, and the We're all of and post trade starting really pure category COVID side help improve? seeing just itself. I earning a was the Have macro stabilize view of we're you is GMV curious, in a macro of things a seen well first initiatives the any of the just dive category starts categories things the to standpoint? improve of the with down stacks tightening as function growth above. progressive the Or this is trade

Steven Michaels

Yes, Robby, thanks.

the growth, trade sit our GMV here are think less Clearly, our be down with is currently, in the latter. we I the pretty the less the It's a now. and getting, there's bad the manufacturing of nice credit also couple and bad categories see. and adding right the is up new that which our I'd but doors, new say, may to much it's partnerships improvement execution as supply retailers dynamic it

bad the so side, that retailers really for little well, there. it's still some the in you're but guiding cycle. quite it's the technology holiday label on hoping demand might would probably There But the tough been saw comp pandemic industry, for a more are which still on to The fairly forward, get a strong is pretty for that and I while from mattress for us here replacement there frankly, makes kind less dip and that important furniture home we out for away put cycle that are And further a the inflecting compute is sense from have have pull and And going a and So bit. to bad. of as pretty to and the smartphones be some standpoint. out starting a quarter. never major flat replacement

as -- and we those of we're about not think any expecting XXXX, in inflection So kind categories.

Robert Griffin

is kind That's crystal like you've guess there a in the starts actually today answer, this ball to then macro All be then not favorable? they're of there, stay further seeing Or seen trends. improve, I history thinking, start just in a but does helpful. when actually And of macro over that I'm so is acceleration where to scenarios the to right. we're see curious your tough one not going category as the I your view. go could But mean tailwinds you you, in tailwinds categories the what even but historical a to of against time improve

Steven Michaels

cycles XX a of last has repeated lot that not where years kind existed. There's Yes. that the progressive have of over

But I -- while in very consumer our demand in tight. overlap I than the because for demand supply. -- your tighter a think is is view acceleration tighter the macro think business could there over demand multiplier the force previously, had for tailwind persists I of I I've think to would But I be you're I that of don't don't categories to an of -- said take for long. strong our I one don't what them credit if choose supply credit consumer as a supply, bigger stronger point,

I'm have think a down quite we to equal I long. the -- simultaneously, love that all credit we I'd it, anticipating demand, good have for if we've strong be things that don't supply have don't the we in exist trade but stronger But I that transition to while pleased demand. consumer from While both that orderly to scenario. tighter been them think credit a very then but lasted an we'll being

Robert Griffin

to details Perfect. holiday I best the luck appreciate the selling on season. there, you and guys

Operator

Our of last BTIG. coming are from Caintic question Vincent the line with

Vincent Caintic

potential, probably is but GMV impacts near-term potential of as and kind the execution think you that growth term as when big quarter single understand But of there's I so think you longer-term the One medium on about X understanding winning there's fourth particular in the that and I phase to executing focusing and to impact be when mentioned you digits -- growth high penetrating basically, well your further? this quarter. theme kind GMV guidance think about appreciate us lots would wondering long that, of business. low and within sales you medium about the fourth think the some help could and that there what you you the of question, a more merchants the helpful. double broad If merchants of or less already holiday have

Steven Michaels

market clearly, and growth. But on not given we really underpenetrated Yes, haven't Vincent, fully. long-term is served the a algorithm GMV being

are built in to however growth have as of various retailers, because I've and with pent the maps we as you retailers a about those think We road to our up, success had or X fortunate lot referred within that. fully initiatives, last over we existing it, and get that our want of partnering deployed do years and deployed. are that to We've haven't to tools

growth and from come that. And has the of progress the some

talking clearly, of necessarily of as growth said, built-in over guaranteed some new with I base. retailers trade we And you're dump of and here. if term, funnel, macro. down we're want got into we're to installed it the from mean we or new just top funded seen our does But the we've that need having going. leases is growth But acceleration longer the that keep just not that new it reinforce the some type GMV. apps But that about to we've intermediate -- add So to pleased to platform

process. to good have a have We

have experience. good customer We a have to

product conversion. We have the a and our an customers for challenge well in LTO those customer customer that to getting get stack. us new order to apps, new us for improve especially familiar when in to that not maybe above they're continually offered with and the are approved products used treat LTO That's getting

So optimization our convert is top of the helping funnel that the the macro into but are helping projects funded open GMV. up into funnel, really

potentially through expect time into we so that And and continue 'XX will over 'XX.

to for existing intend we to will retailers, help long-term But as base. that's we the grow but to going as need far to So add can and our be while. with growth, a a

Operator

call the closing turn now for any will I back Michael over Mr. to Steve And remarks.

Steven Michaels

your I'd thank in this interest joining you like and continued for for PROG. to, again, guys morning us

the excited updating and to well, Have wrapped forward great again day. growth our year executing are look about teams ready We a strong. this to Our up. has you finish year once

Operator

today. does participation, for you may gentlemen, for that Ladies disconnect. conference and Thank and your our now conclude you

PROG (PRG) 23 Oct 242024 Q3 Earnings call transcript