PROG Holdings Reports Second Quarter 2025 Results

Business Wire

5 days ago

SALT LAKE CITY--(BUSINESS WIRE)--PROG Holdings, Inc. (NYSE:PRG), the fintech holding company for Progressive Leasing, Vive Financial, Four Technologies, and Build today announced financial results for the second quarter ended June 30, 2025.
"Our second quarter results once again demonstrate the resiliency of our Leasing business and our ability to manage through a period of high uncertainty and the loss of an important retail partner to liquidation," said Steve Michaels, President and CEO of PROG Holdings. "The revenue and earnings outperformance compared to guidance reflects strong execution in our Progressive Leasing business, where our teams took deliberate actions to preserve portfolio health while expanding balance of share with key retail partners - even as we navigated notable GMV headwinds. At the same time, Four Technologies delivered another outstanding quarter, with over 200% revenue growth and continued profitability. Four is delivering value to our ecosystem – driving cross-sell opportunities and enhancing customer engagement across our platform."
"At Progressive Leasing, we're advancing our technology initiatives – deploying AI-powered tools, optimizing our digital funnel, and enhancing our mobile and web experiences to create a more seamless, personalized customer journey. These improvements are driving greater efficiency and top-of-funnel engagement, even as we make strategic decisions to moderate GMV growth and maintain portfolio performance within our targeted annual write-off range to fulfill our expectation of sustainable and profitable growth."
"I am extremely proud of our team's execution as we strike the balance of executing on growth objectives in our Progressive Leasing business and further developing our other suite of products which holds significant promise," Michaels concluded.
Consolidated Results
Consolidated revenues for the second quarter of 2025 were $604.7 million, an increase of 2.1% from the same period in 2024.
Consolidated net earnings for the quarter were $38.5 million, compared with $33.8 million in the prior year period. The effective income tax rate was 26.8% in the second quarter. Adjusted EBITDA for the quarter was $73.5 million, or 12.2% of revenues, compared with $72.3 million, or 12.2% of revenues for the same period in 2024.
Diluted earnings per share for the second quarter of 2025 were $0.95, compared with $0.77 in the year ago period. On a non-GAAP basis, diluted earnings per share were up 10.9% at $1.02 in the second quarter of 2025, compared with $0.92 for the same period in 2024. The Company's diluted weighted average shares outstanding in the second quarter were 7.2% lower year-over-year.
Progressive Leasing Results
Progressive Leasing's second quarter GMV of $413.9 million was down 8.9% compared to the same period in 2024. The provision for lease merchandise write-offs for the quarter was 7.5% of leasing revenues, within the Company's 6-8% targeted annual range.
Liquidity and Capital Allocation
PROG Holdings ended the second quarter of 2025 with cash of $222.0 million and gross debt of $600.0 million. The Company repurchased $25.7 million of its stock in the quarter at an average price of $28.51 per share, leaving $309.6 million of repurchase capacity under its $500 million share repurchase program. Additionally, the Company paid a quarterly cash dividend of $0.13 per share.
2025 Outlook
The Company is providing selective third quarter outlook metrics and updating its full year 2025 outlook by increasing the low end of our previous range on revenues and earnings metrics and maintaining the previous high ends of those same metrics. The updated outlook below assumes a difficult operating environment with soft demand for consumer durable goods, no material changes in the Company's current decisioning posture, an effective tax rate for Non-GAAP EPS of approximately 27%, and no impact from additional share repurchases.
Conference Call and Webcast
The Company has scheduled a live webcast and conference call for Wednesday, July 23, 2025, at 8:30 A.M. ET to discuss its financial results for the second quarter of 2025. To access the live webcast, visit the Events and Presentations page of the Company's Investor Relations website, https://investor.progholdings.com/.
About PROG Holdings, Inc.
PROG Holdings, Inc. (NYSE:PRG) is a fintech holding company headquartered in Salt Lake City, UT, that provides transparent and competitive payment options to consumers. The Company owns Progressive Leasing, a leading provider of e-commerce, app-based, and in-store point-of-sale lease-to-own solutions, Vive Financial, an omnichannel provider of second-look revolving credit products, Four Technologies, a provider of Buy Now, Pay Later payment options through its platform, Four, and Build, provider of personal credit building products. More information on PROG Holdings and its companies can be found at https://investor.progholdings.com/.
Forward Looking Statements:
Statements, estimates and projections in this press release regarding our business that are not historical facts are "forward-looking statements" that involve risks and uncertainties which could cause actual results to differ materially from those contained in the forward-looking statements. Such forward-looking statements generally can be identified by the use of forward-looking terminology, such as "delivering," "driving," "advancing," "expectation," "estimate," "target," "uncertainty," "outlook," "assumes," "intends" and similar forward-looking terminology. These risks and uncertainties include (i) continued volatility and challenges in the macroeconomic environment and their impact on: (a) consumer confidence and customer demand for the merchandise that our retail partners sell, in particular consumer durables, such as home appliances, electronics and furniture; (b) our customers' disposable income and their ability to make the lease and loan payments they owe the Company; (c) the availability of consumer credit; and (d) our overall financial performance and outlook; (ii) the impact of the uncertain macroeconomic environment on our proprietary algorithms and decisioning tools that we use to approve customers such that they are no longer indicative of our customers' ability to perform, which in turn may limit the ability of our businesses to manage risk, avoid lease and loan charge-offs and may result in insufficient reserves to cover actual losses; (iii) a large percentage of Progressive Leasing's revenue being concentrated with several key retail partners, and the loss of any of these retail partner relationships materially and adversely affecting several aspects of our performance; (iv) Progressive Leasing being unable to attract additional retail partners and retain and grow its relationships with its existing retail partners, resulting in several aspects of our performance being materially and adversely affected; (v) Progressive Leasing being unable to attract new consumers and retain and grow its relationships with its existing customers materially and adversely affecting several aspects of our performance; (vi) Vive and Four's business models differing significantly from Progressive Leasing's lease-to-own business, which means each of these businesses have different risk profiles; (vii) our efforts to modernize and enhance certain enterprise-wide information management systems and technologies adversely impacting our businesses and operations; (viii) the inability of our businesses to successfully operate in highly and increasingly competitive industries materially and adversely affecting several aspects of our performance; (ix) our business, results of operations, financial condition, and prospects being materially and adversely affected due to Progressive Leasing failing to maintain a consistently high level of consumer satisfaction and trust in its brand; (x) our businesses being subject to extensive federal, state and local laws and regulations, including certain laws and regulations unique to the industries in which our businesses operate, that may subject them to government investigations and significant monetary penalties, remediation expenses and compliance-related burdens that may result in them changing the manner in which they operate, which may be materially adverse to several aspects of our performance; (xi) our performance being materially and adversely affected due to the transactions offered to consumers by our businesses being negatively characterized by federal, state and local government officials, consumer advocacy groups and the media; (xii) our inability to protect confidential, proprietary, or sensitive information, including the confidential information of our customers, being adversely affected by cyber-attacks or similar disruptions, which may result in significant costs, litigation and reputational damage or otherwise have a material adverse impact on several aspects of our performance; (xiii) any significant disruption in our vendors' information technology systems, or disruptions in the information our businesses rely on in their lease and loan decisioning, materially and adversely affecting several aspects of our performance; (xiv) our capital allocation strategy and financial policies, including our current stock repurchase and dividend programs, as well as any potential debt repurchase program not being effective at enhancing shareholder value, or providing other benefits we expect; and (xv) the other risks and uncertainties discussed under "Risk Factors" in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2024, filed with the SEC on February 19, 2025. Statements, estimates and projections in this press release that are "forward-looking" include without limitation statements, estimates and projections about: (i) growing our balance of share with key retail partners; (ii) the performance of our lease portfolio, including our annual write-offs; (iii) the progress of our Four Technologies business and the benefits we expect from that business; (iv) the advancement of our technology initiatives; (v) our ability to continue achieving sustainable and profitable growth; (vi) our revised full year 2025 outlook and the guidance we provide for the third quarter. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Except as required by law, the Company undertakes no obligation to update these forward-looking statements to reflect subsequent events or circumstances after the date of this press release.
PROG Holdings, Inc.
Consolidated Balance Sheets
(In thousands, except share data)
(Unaudited)
June 30, 2025
December 31, 2024
ASSETS:
Cash and Cash Equivalents
$
222,027
$
95,655
Accounts Receivable (net of allowances of $68,788 in 2025 and $71,607 in 2024)
60,531
80,225
Lease Merchandise (net of accumulated depreciation and allowances of $440,339 in 2025 and $440,831 in 2024)
526,303
680,242
Loans Receivable (net of allowances and unamortized fees of $58,930 in 2025 and $57,342 in 2024)
148,320
146,985
Property and Equipment, Net
21,179
21,443
Operating Lease Right-of-Use Assets
3,352
4,035
Goodwill
296,061
296,061
Other Intangibles, Net
65,774
73,775
Income Tax Receivable
8,817
10,644
Deferred Income Tax Assets
26,472
26,472
Prepaid Expenses and Other Assets
75,760
78,230
Total Assets
$
1,454,596
$
1,513,767
LIABILITIES & SHAREHOLDERS' EQUITY:
Accounts Payable and Accrued Expenses
$
92,765
$
93,190
Deferred Income Tax Liabilities
54,271
74,320
Customer Deposits and Advance Payments
35,504
40,917
Operating Lease Liabilities
9,171
11,496
Debt, Net
594,212
643,563
Total Liabilities
785,923
863,486
SHAREHOLDERS' EQUITY:
Common Stock, Par Value $0.50 Per Share: Authorized: 225,000,000 Shares at June 30, 2025 and December 31, 2024; Shares Issued: 82,078,654 at June 30, 2025 and December 31, 2024
41,039
41,039
Additional Paid-in Capital
349,707
358,538
Retained Earnings
1,531,768
1,469,450
1,922,514
1,869,027
Less: Treasury Shares at Cost
Common Stock: 42,535,192 Shares at June 30, 2025 and 41,262,901 at December 31, 2024
(1,253,841
)
(1,218,746
)
Total Shareholders' Equity
668,673
650,281
Total Liabilities & Shareholders' Equity
$
1,454,596
$
1,513,767
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PROG Holdings, Inc.
Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
Six Months Ended June 30,
2025
2024
OPERATING ACTIVITIES:
Net Earnings
$
73,201
$
55,740
Adjustments to Reconcile Net Earnings to Cash Provided by Operating Activities:
Depreciation of Lease Merchandise
845,550
816,370
Other Depreciation and Amortization
12,111
14,515
Provisions for Accounts Receivable and Loan Losses
198,650
174,822
Stock-Based Compensation
14,536
13,737
Deferred Income Taxes
(20,049
)
(16,973
)
Impairment of Assets
—
6,018
Non-Cash Lease Expense
(1,642
)
(1,603
)
Other Changes, Net
(943
)
(155
)
Changes in Operating Assets and Liabilities:
Additions to Lease Merchandise
(784,951
)
(836,084
)
Book Value of Lease Merchandise Sold or Disposed
93,340
89,549
Accounts Receivable
(147,179
)
(145,312
)
Prepaid Expenses and Other Assets
5,480
377
Income Tax Receivable and Payable
1,749
26,206
Accounts Payable and Accrued Expenses
(4,620
)
(5,113
)
Customer Deposits and Advance Payments
(5,413
)
(967
)
Cash Provided by Operating Activities
279,820
191,127
INVESTING ACTIVITIES:
Investments in Loans Receivable
(370,099
)
(172,513
)
Proceeds from Loans Receivable
339,206
158,644
Purchases of Property and Equipment
(3,896
)
(3,999
)
Other Proceeds
—
46
Cash Used in Investing Activities
(34,789
)
(17,822
)
FINANCING ACTIVITIES:
Repayments on Revolving Facility
(50,000
)
—
Dividends Paid
(10,443
)
(10,346
)
Acquisition of Treasury Stock
(51,775
)
(61,177
)
Issuance of Stock Under Stock Option and Employee Purchase Plans
1,028
799
Cash Paid for Shares Withheld for Employee Taxes
(7,385
)
(7,863
)
Debt Issuance Costs
(84
)
—
Cash Used in Financing Activities
(118,659
)
(78,587
)
Increase in Cash and Cash Equivalents
126,372
94,718
Cash and Cash Equivalents at Beginning of Period
95,655
155,416
Cash and Cash Equivalents at End of Period
$
222,027
$
250,134
Net Cash Paid During the Period:
Interest
$
18,795
$
18,461
Income Taxes
$
45,044
$
12,728
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PROG Holdings, Inc.
Quarterly Revenues by Segment
(In thousands)
(Unaudited)
Three Months Ended
June 30, 2025
Progressive Leasing
Vive
Other
Consolidated Total
Lease Revenues and Fees
$
569,674
$
—
$
—
$
569,674
Interest and Fees on Loans Receivable
—
16,160
18,829
34,989
Total Revenues
$
569,674
$
16,160
$
18,829
$
604,663
Expand
(Unaudited)
Three Months Ended
June 30, 2024
Progressive Leasing
Vive
Other
Consolidated Total
Lease Revenues and Fees
$
570,516
$
—
$
—
$
570,516
Interest and Fees on Loans Receivable
—
15,421
6,224
21,645
Total Revenues
$
570,516
$
15,421
$
6,224
$
592,161
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PROG Holdings, Inc.
Six Month Revenues by Segment
(In thousands)
(Unaudited)
Six Months Ended
June 30, 2025
Progressive Leasing
Vive
Other
Consolidated Total
Lease Revenues and Fees
$
1,221,231
$
—
$
—
$
1,221,231
Interest and Fees on Loans Receivable
—
31,820
35,700
67,520
Total Revenues
$
1,221,231
$
31,820
$
35,700
$
1,288,751
Expand
(Unaudited)
Six Months Ended
June 30, 2024
Progressive Leasing
Vive
Other
Consolidated Total
Lease Revenues and Fees
$
1,191,066
$
—
$
—
$
1,191,066
Interest and Fees on Loans Receivable
—
31,471
11,494
42,965
Total Revenues
$
1,191,066
$
31,471
$
11,494
$
1,234,031
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Use of Non-GAAP Financial Information:
Non-GAAP net earnings, non-GAAP diluted earnings per share, and adjusted EBITDA are supplemental measures of our performance that are not calculated in accordance with generally accepted accounting principles in the United States ("GAAP"). Non-GAAP diluted earnings per share for the full year 2025 and third quarter 2025 outlook excludes intangible amortization expense. Non-GAAP net earnings and non-GAAP diluted earnings per share for the three and six months ended June 30, 2025 exclude intangible amortization expense and costs related to the cybersecurity incident, net of insurance recoveries. Non-GAAP net earnings and non-GAAP diluted earnings per share for the three and six months ended June 30, 2024 exclude intangible amortization expense, restructuring expenses, costs related to the cybersecurity incident, and accrued interest on an uncertain tax position related to Progressive Leasing's $175 million settlement with the FTC in 2020. The amount for the after-tax non-GAAP adjustment, which is tax effected using our statutory tax rate, can be found in the reconciliation of net earnings and diluted earnings per share to non-GAAP net earnings and diluted earnings per share table in this press release.
The Adjusted EBITDA figures presented in this press release are calculated as the Company's earnings before interest expense, net, depreciation on property and equipment, amortization of intangible assets and income taxes. Adjusted EBITDA for the full year 2025 and third quarter 2025 outlook excludes stock-based compensation expense. Adjusted EBITDA for the three and six months ended June 30, 2025 excludes stock-based compensation expense and costs related to the cybersecurity incident, net of insurance recoveries. Adjusted EBITDA for the three and six months ended June 30, 2024 excludes stock-based compensation expense, restructuring expenses, and costs related to the cybersecurity incident. The amounts for these pre-tax non-GAAP adjustments can be found in the segment EBITDA tables in this press release.
Management believes that non-GAAP net earnings, non-GAAP diluted earnings per share, and adjusted EBITDA provide relevant and useful information, and are widely used by analysts, investors and competitors in our industry as well as by our management in assessing both consolidated and business unit performance.
Non-GAAP net earnings, non-GAAP diluted earnings, and adjusted EBITDA provide management and investors with an understanding of the results from the primary operations of our business by excluding the effects of certain items that generally arose from larger, one-time transactions that are not reflective of the ordinary earnings activity of our operations or transactions that have variability and volatility of the amount. We believe the exclusion of stock-based compensation expense provides for a better comparison of our operating results with our peer companies as the calculations of stock-based compensation vary from period to period and company to company due to different valuation methodologies, subjective assumptions and the variety of award types. This measure may be useful to an investor in evaluating the underlying operating performance of our business.
Adjusted EBITDA also provides management and investors with an understanding of one aspect of earnings before the impact of investing and financing charges and income taxes. These measures may be useful to an investor in evaluating our operating performance because the measures:
Are widely used by investors to measure a company's operating performance without regard to items excluded from the calculation of such measure, which can vary substantially from company to company depending upon accounting methods, book value of assets, capital structure and the method by which assets were acquired, among other factors.
Are used by rating agencies, lenders and other parties to evaluate our creditworthiness.
Are used by our management for various purposes, including as a measure of performance of our operating entities and as a basis for strategic planning and forecasting.
Non-GAAP financial measures, however, should not be used as a substitute for, or considered superior to, measures of financial performance prepared in accordance with GAAP, such as the Company's GAAP basis net earnings and diluted earnings per share and the GAAP revenues and earnings before income taxes of the Company's segments, which are also presented in the press release. Further, we caution investors that amounts presented in accordance with our definitions of non-GAAP net earnings, non-GAAP diluted earnings per share, and adjusted EBITDA may not be comparable to similar measures disclosed by other companies, because not all companies and analysts calculate these measures in the same manner.
(1)
Adjustments are tax-effected using an assumed statutory tax rate of 26%.
(2)
In some cases, the sum of individual EPS amounts may not equal total non-GAAP EPS calculations due to rounding.
Expand
(1)
Taxes are calculated on a consolidated basis and are not identifiable by Company segment.
Expand
(Unaudited)
Three Months Ended
June 30, 2024
Progressive Leasing
Vive
Other
Consolidated Total
Net Earnings
$
33,774
Income Tax Expense (1)
14,565
Earnings (Loss) Before Income Tax Expense
$
53,966
$
631
$
(6,258
)
48,339
Interest Expense, Net
7,655
—
(316
)
7,339
Depreciation
1,651
166
441
2,258
Amortization
4,009
—
230
4,239
EBITDA
67,281
797
(5,903
)
62,175
Stock-Based Compensation
6,135
360
600
7,095
Restructuring Expense
258
—
2,628
2,886
Costs Related to the Cybersecurity Incident
116
—
—
116
Adjusted EBITDA
$
73,790
$
1,157
$
(2,675
)
$
72,272
Expand
(1)
Taxes are calculated on a consolidated basis and are not identifiable by Company segment.
Expand
(1)
Taxes are calculated on a consolidated basis and are not identifiable by Company segment.
Expand
(Unaudited)
Six Months Ended
June 30, 2024
Progressive Leasing
Vive
Other
Consolidated Total
Net Earnings
$ 55,740
Income Tax Expense (1)
24,166
Earnings (Loss) Before Income Tax Expense
$ 89,419
$ 1,549
$ (11,062)
79,906
Interest Expense, Net
16,222
—
(633)
15,589
Depreciation
3,461
332
833
4,626
Amortization
9,430
—
459
9,889
EBITDA
118,532
1,881
(10,403)
110,010
Stock-Based Compensation
10,846
698
2,193
13,737
Restructuring Expense
18,272
—
2,628
20,900
Costs Related to the Cybersecurity Incident
232
—
—
232
Adjusted EBITDA
$ 147,882
$ 2,579
$ (5,582)
$ 144,879
Expand
(1)
Taxes are calculated on a consolidated basis and are not identifiable by Company segment.
Expand
(1)
Taxes are calculated on a consolidated basis and are not identifiable by Company segment.
Expand
Previous Fiscal Year 2025 Ranges
Progressive Leasing
Vive
Other
Consolidated Total
Estimated Net Earnings
$109,000 - $125,000
Income Tax Expense (1)
45,000 - 49,000
Projected Earnings (Loss) Before Income Tax Expense
$168,000 - $185,000
$(5,000) - $(3,500)
$(9,000) - $(7,500)
154,000 - 174,000
Interest Expense, Net
30,000 - 28,000
1,000
6,000
37,000 - 35,000
Depreciation
6,000
500
2,500
9,000
Amortization
15,000
—
1,000
16,000
Projected EBITDA
219,000 - 234,000
(3,500) - (2,000)
500 - 2,000
216,000 - 234,000
Stock-Based Compensation
26,000 - 27,000
1,000
2,000 - 3,000
29,000 - 31,000
Projected Adjusted EBITDA
$245,000 - $261,000
$(2,500) - $(1,000)
$2,500 - $5,000
$245,000 - $265,000
Expand
(1)
Taxes are calculated on a consolidated basis and are not identifiable by Company segment.
Expand
(1)
Taxes are calculated on a consolidated basis and are not identifiable by Company segment.
Expand
(1)
Adjustments are tax-effected using an assumed statutory tax rate of 26%.
(2)
In some cases, the sum of individual EPS amounts may not equal total non-GAAP EPS calculations due to rounding.
Expand
(1)
Adjustments are tax-effected using an assumed statutory tax rate of 26%.
(2)
In some cases, the sum of individual EPS amounts may not equal total non-GAAP EPS calculations due to rounding.
Expand
(1)
Adjustments are tax-effected using an assumed statutory tax rate of 26%.
(2)
In some cases, the sum of individual EPS amounts may not equal total non-GAAP EPS calculations due to rounding
Expand
.