OppFi at Oppenheimer Conference: Strategic Growth and Innovation

On Tuesday, 12 August 2025, OppFi (NYSE:OPFI) presented at the Oppenheimer 28th Annual Technology, Internet & Communications Conference. The company highlighted its mission to serve credit-insecure Americans through a tech-enabled digital finance platform, showcasing both positive growth metrics and strategic challenges. While financial performance showed robust growth, the company also faces the challenge of maintaining operational efficiency in a competitive market.

Key Takeaways

• OppFi reported a 13% year-over-year revenue growth in Q2 and a 99% increase in adjusted net income from FY23 to FY24.
• The company revised its 2025 earnings guidance upwards, with projected revenue between $578 million and $605 million.
• A new credit model, Model six, increased originations by 3.3% without raising charge-offs.
• The acquisition of a 35% stake in Bitty is expected to contribute over $4 million in pre-tax earnings for 2025.
• OppFi declared a special dividend of 25¢ a share and repaid $30 million in high-rate term loan debt.

Financial Results

• Q2 revenue reached $142 million, marking a 13% increase from the previous year.
• Adjusted net income soared by 99%, from $41 million in FY23 to $83 million in FY24.
• Adjusted EPS rose from $0.49 to $0.95 per share.
• Customer lifetime value analysis indicated a revenue of nearly $3,000 per customer, with net charge-offs averaging $1,179 per customer.

Operational Updates

• Operating expenses as a percentage of revenue decreased by 27% from 2021 to 2024.
• The company maintains a high Net Promoter Score of 79, reflecting strong customer satisfaction.
• Recoveries improved significantly from 5.9% in 2022 to 15% in 2025.

Future Outlook

• OppFi’s 2025 guidance projects total revenue between $578 million and $605 million, adjusted net income between $125 million and $130 million, and adjusted EPS ranging from $1.39 to $1.44.
• The company plans to focus on operational efficiency, strategic acquisitions, and new product extensions to enhance market penetration.
• With a total funding capacity of $603.3 million, including $219 million in undrawn debt and $78.3 million in cash, OppFi is well-positioned for continued growth.

Acquisition of Bitty

• OppFi acquired a 35% stake in Bitty, a small business financing company, for $4 million before taxes.
• The acquisition is expected to yield a 21% return on investment, with Bitty projected to contribute over $4 million in pre-tax earnings for 2025.
• Cash distributions from Bitty have exceeded $4 million as of the latest update.

Conclusion

For further details, readers are encouraged to refer to the full transcript of the conference call below.

Full transcript - Oppenheimer 28th Annual Technology, Internet & Communications Conference:

Mike Gallantine, Head of Investor Relations, OpFy: Hello, everybody, and thank you for attending the OpFund Investor Presentation at the Oppenheimer Conference this afternoon. Let me direct you to the fun slide, the Slide two, the disclaimer, the forward looking statements, cautionary language slide that we will be using in our presentation is we have some non GAAP measures that we present, and we do provide a full reconciliation for all non GAAP measures at the end of the presentation. This presentation will also be on the OpFy Investor website if you’d like to refer to this at later date. With that, I’m Mike Gallantine, Head of Investor Relations, and I am here with Pam Johnson, our CFO for OpFy, and and I’d like to turn the call over to Pam for her presentation.

Pam Johnson, CFO, OpFy: Thank you, Mike, and welcome, everyone. It’s always fun for me to be able to tell the story about OpFy, a company I’m very proud to work for and share share the the the great things we’ve done and that we plan to do. So we’ll start here just give you kind of a a overview of the company. We are tech enabled digital finance platform that partners with banks to offer financial products and services to everyday Americans. We are mission driven.

We, have very high customer satisfaction scores. We are so proud of our 79 NPS score that we consistently have with our customers. We have significant economic scale. We’ve been in business since 2012, and we facilitated more than 7,800,000,000.0 in gross loan issuance covering over 4,300,000 loans since our inception. We have ten consecutive years of positive net income, and we’ve been very profitable across all business cycles.

We’ve seen ups and downs, and we continue to show profitability through the tougher times as well as the good times. There is a large adjustable market. We’ll talk a little bit about that in a minute, but there’s 60,000,000 US consumers that face credit insecurity and have little access to other types of credit. But we have a strong fundamentals and a balance sheet to support our operations. We have a wonderful operating efficiency, that drives great free cash flow and a robust balance sheet that’ll position us for growth.

Our mission is to serve those 60,000,000 US consumers that are credit marginalized. They are the everyday consumer that struggles with with a lot of things in their financial life. Forty three percent face financial difficulties paying bills or expenses. 42% of households have less than a month of savings and thirty nine percent of credit applicants were turned down or did not get as much credit as they applied for. So our customers are looking for funds to help them with their everyday expenses and emergencies.

As I like to say, they are borrowing for usually for needs, not wants. And they are your neighbors, they are the people who work for you, they may be your children. And so, you know, some we feel very passionate about what we do and how we can help them. I’m not gonna go through each of these, but this kinda gives you what the typical OpFi customer is. We call them the everyday American.

And, you know, you may be a little surprised about some of these things. Their average age of our customers, you know, their annual income. Fact that 33% of them are college educated and 28% of them actually own their homes. I’ll take a few minutes now and talk to you about our product. We are a platform, so we lead with customer first mentality.

Again, you saw those those NPS scores and and a 79 is exceptionally high NPS score. And we we deliver a top tier digital personal experience to an underbanked consumer. And we talked underbanked, know, those folks who do have trouble getting credit and getting checking accounts even in some cases now. Our folks do are required to have a checking account in order to for us to underwrite them. But we do our product is a simple interest amortizing installment loan with no balloon payments.

So it’s very, very transparent, very easy to understand. The customer knows when the loan payments will start, when they’ll come out, how much they will be, and when they will end. We have no fees. I think this is something that’s pretty amazing. We have no late fees.

We have no NSF fees. We have no origination fees. So again, the customer knows exactly the terms of that loan. We report to three major credit bureaus so the customer has an opportunity if they service our loan and and perform as as expected, they can improve their credit score, and many of them do, through our services. We, work to give them same day funding depending on when their, loan applications come in.

It’s very possible we can get them cash that very same day. And we work compassionately with our customers. I call this a compassionate collector in that we have lots of payment plans and, opportunities to work with the customer when they faced a hardship. We differentiate ourselves from, the other options that our customers tend to have, and that is payday loans and tribal loans. And both of those generally have fairly significant fees that come with them, much higher effective APRs than ours.

And in many cases, payday loans in particular, they don’t verify the ability to repay. And that’s something that we think is very important. We do what we call cash flow underwriting. So if they we look at what cash they have coming in, what cash they have going out and their ability to service a loan, and we won’t put anybody into a loan that we feel like they can’t service. It would be irresponsible to do that.

Most payday and tribal loans don’t report to credit bureaus, and we do. And we also provide financial health resources. If you go to our website, the customers can find all sorts of training and informational information that would help them improve their credit and their financial status. Talk a little bit about that new customer journey. All customers can enter our eco with with a digital portal.

It begins with an online application a 100%. Now there is optional agent support if they have an issue with that initial application. And that’s the other thing that I think differentiates. They can reach a person all the way through the journey. And that is something that I think is really important when need us.

And our prospective customers usually in a moment of financial distress, and it’s a very stressful time for them. So we know that and we try and tailor our experience to that situation. One of the coolest things I think we do is we do a turn up process. And so when a customer applies for us, the first thing we do is go out to some partners that we know that perhaps would underwrite these folks and give them a better rate than what we could and give them a better deal than what we could. And it would be a sub 36% APR.

About 90% of the time that is not available to our customers, but there’s 10% of the time when they are able to get a better rate and a better transaction for them, and we’re happy for them for that situation. About 71% of all of our customers receive same day decisioning with 30% receiving same day funding. We have twenty four seven access online so a person can see what their the status of their their loan is at any time. We use a chat feature and we have one click payments and live agent support. Again, that that customer can reach a live agent all through their journey here.

Again, we do that promotion of financial health with free financial education that’s available on our website through Optu and Blog and Zogo are our partners there. And our customers are our biggest advocates of our brand in many cases. With our high NPS scores, our high customer satisfaction scores, referrals are kind of an easy thing for us because 50,000 have been shared by customers in 2024 alone. And sixty one percent of our customers come back because they know they’ve been treated well and fairly with OpFy. And so when they’re in need again for some additional funding, they come back to us on a more than average more than 50% of them at 61%.

We our underwriting is powered by technology. We use a machine learning. It’s we call it model six. It, we launched that last fall, and it better predicts the the credit risk and more effectively targets credit worthy borrowers. And you can see we have a lot

Mike Gallantine, Head of Investor Relations, OpFy: We got 15,000,000,000 data points that we

Pam Johnson, CFO, OpFy: can reference because of all the transactions we’ve done over the last 13 targets years. We’ve done 14,000,000 applications, 2,000,000 loans, accepted 30,000,000 repayments. And we look at 500 attributes per repayment to understand the customer behavior. And 92% of our decisions are automated. Talk a little bit more about credit model six.

It’s really been helpful to us as we grow and get more sophisticated in our underwriting. It looks at the application level to look at true risk based pricing, which is something we’ve been able to launch since this model has been introduced. And we’re driving higher originations without increasing losses. And it’s because we look at these next generation credit reports. They’re called alternative credit bureaus that are out there that tell us different things about our customer that you won’t get off of a FICO score or a regular credit bureau report, such as how effectively are they paying their cell phone bills, how effectively are they paying their utility bills, how how are they handling those kind of daily activities in a financial life that shows how responsible they can be in in servicing our loan.

There’s also a proprietary banking transaction attributes we look at. We can take a look at the customers, take a peek into their bank account, of course, with their permission, and see all the transactions, see what’s coming in, what’s going out. And then we also look at how they’ve performed in the past when they’ve had loans with us. And so all of this has added to a 3.3% increase in incremental originations relative to the previous model without escalating our charge offs. So it’s been a it’s been a great tool for us.

The way we capture demand, we have organic and paid channels that allow us to to find that customer or lead the customer to us. And we use direct mail, and we use marketing partners such as Credit Karma, Experian, and LendingTree through our paid channels. Then we have organic channels. We use SEO. We’ve got a very sophisticated team that handles our SEO.

As I mentioned, the refer a friend has been very, very successful for us. And then we use email to retarget prospects who began an application, but for some reason abandoned it and try to get them to come back and and and work with us. I won’t read these customer testimonials, but something that I am very proud of. If you look at, you know, our Google scores, our Trustpilot, our Better Business Bureau ratings, in our office in Chicago, we have monitors hanging from the ceiling. And all day long, they just, scroll customer testimonials, And they’re some of the happiest parts of my day when I’m in that office in that I love to see how we’ve impacted people’s lives, and it’s it’s always a very, very touching thing to see.

As we look forward, we’ve implemented a growth strategy. We kind of started really back in early twenty twenty two when Todd Schwartz came back as our CEO. I became the CFO and we have looked at operational efficiencies and scale and really made some impact there. We’ve established new partnerships, new marketing and bank relationships that have been very positive for the company. And now we’re into this as you see the blue line up into the right where we’ve enhancing the credit model to expand our market potential performance, again allowing us to do more what I call risk based pricing.

And then we’re looking at a lot of accretive and strategic acquisitions. It’s amazing how many things are out there that we look at and talk to folks about. Lots of activity in that space right now. And then we’re looking at new products and extensions intended to increase market penetration. Different types of diversity within our product line is important.

Right now we have the core product, OpLoans is the brand there. Plus we made an investment in Bitty, which is a small business financing company. We’ll talk about that a little bit more in a couple of minutes here. But as we look at things that we can expand into, there’s, you know, the very related types of industries, retail installment, lease to own, point of sale financing, and some mobile banking. You know, we could look like we could possibly launch a line of credit, a cash advance or an earned wage access product.

And then looking at just different accretive partnerships with companies kind of similar to what we’ve done with Bitty. The Bitty transaction was our first transaction we’ve made as a company, and it was our entry into the small business financing market. You know, it aligned with our mission because we saw small businesses have similar issues to our customers in that they couldn’t access the credit they needed for their business. And we wanted to fill that supply demand imbalance. It gives us earnings growth, and it’s been a path to that multi line business versus a mono line business.

We purchased a 35% stake last July, and we have call options to acquire additional equity of 30% in 2027 and the remaining equity in 02/1930. You know, we’re earning about $4,000,000 plus in 2025, pretty sure, before taxes. And and amortization will be about a 21% return on that investment. And we’ve already received cash distributions of approximately $3,200,000 from that time of investment through April 30. And actually, if you look at through today, we’re over 4,000,000 now.

So it has been a very good investment and we work very well with their management team. And it’s been a good learning experience for all of us. We exchange, best practices and work well together. So it’s been a great acquisition, very happy with it. Share To with you just a little bit about our financial performance and going down into the nitty gritty of it, look at a customer lifetime value.

This is a waterfall that, you know, shares that over customer lifetime, we have realized revenue of nearly $3,000 And as you look at the net charge offs that come out of that, those average about $11.79 dollars We have some acquisition costs. We have to pay those channel providers. There’s direct mail costs, things like that. That’s about $220 per customer. In general, if you look at that, you pay that once because when you, get the refinances or they come back to you, you don’t have that marketing cost.

We have some origination costs just from our internal, operations team for $109 per customer. And then we have interest expense because we do borrow money to lend to our customers, and that’s about $232 at the interest rates we’ve we’ve had recently. And that gives us a 42% margin before any of our like corporate and overhead expense. And when you add that you get to a 23% margin or six ninety four dollars of earnings before taxes out of that customer. Our operational efficiencies have continued to improve.

Know, in 2021, our operating expenses as a percentage of revenue was 58.9% and in 2024 was 43.1%. So that’s a 27% decrease. This really excites me because I’m really starting to feel the scalability of this company with our current expense levels and, you know, with only slight increases, the ability to scale is really great. We have a lot of efficiencies that are happening within the company right now. Our proprietary underwriting model improves our write off performance.

So this is, you know, credit risk, going forward. If you look at, the the years, you know, 2021 was a very unusual year. We had the economic stimulus coming out of the pandemic. So customers had cash. They were paying their loans.

They were paying them off in a lot of instances. So that those losses were very artificially low in 2021. We knew that could not last. 2022, we saw just the opposite as we saw the the inflation increase so suddenly in the first part of 2022, that inflation impacts our customers probably in a more impactful than in for customers who or for people who have, you know, higher incomes and a more stable financial future. The additional cost of groceries and utilities and rent hit our customers hard.

So we saw higher losses in 2022. In developing Model six, we could could now more grasp. We learned a lot out of twenty two twenty twenty two. We can now understand more of behavior, and we can now look further ahead and and understand. So, we we took those learnings from 2022, and we’ve seen, improvement in both 2023, 2024.

And if you see that little line there, 2025, we are now seeing consistent, reasonably expected losses for 2025. Recoveries. So after we charge off a loan or write off a loan, which we do that at ninety days contractually past due, We then work with our customers to try and recover. And again, knowing that a lot of times they’re going through a hardship at this time, we have good programs to do that. We have partners that we use to do this.

We have technology that we use. And so we have really emphasized this and put together a strong team over the last couple of years. And you can see how our recoveries have improved. In 2022, we were only at 5.9% of written off loan balances. Now we’re at 15%.

So a major, major win for us. And as I always like to say, those recoveries, every dollar goes to the bottom line, so that makes a CFO really happy. And so it’s been a great success story for the company. Now take a look at our overall financial performance as a company. Looking at total revenue, Q2 was $142,000,000 and that was a 13% year over year growth from Q2 of last year.

So you can see that we have nice sustained growth through over the last four quarters. And our adjusted net income as well grew. Again, you saw how we’ve been seeing the operational So you got the top line growing, you got the expenses going down, and it makes for a nice bump for sure to adjusted net income. So FY ’23, we had $41,000,000 in adjusted gross income and we had $83,000,000 in 2024, so 99% increase.

And you saw a similar increase then in our adjusted EPS from $0.49 a share to $0.95 a share. We generate a lot of cash flow as a company, and we have a lot of opportunities to allocate that capital. Over the last few months, we in 2025, we repaid $30,000,000 in a high rate term loan debt. We upsized our current revolving credit facility with affiliates of Blue Owl Capital by $50,000,000 giving us more room for growth. And we declared a special dividend of 25¢ a share, which was $28,100,000 overall.

And we can do that when you look in at our June funding capacity on the right here. You know, we’ve got drawn debt of $3.00 5,000,000, but we’ve got undrawn debt of $219,000,000, and then we’ve got cash on the balance sheet of 78,300,000.0. So a total funding capacity of $603,300,000 So with our good results from Q2 twenty twenty five, we did revise our earnings guidance upward. We are now looking at total revenue of $578,000,000 to $6.00 $5,000,000 for 2025. That’s a raise from $563 to $594 that range.

Adjusted net income, again, a range of $125 to 130,000,000 and that’s a raise from $106 to $113 And our adjusted EPS is $1.39 to $1.44 and the range we previously had was $1.18 to 1.26 So we’re looking forward to a really good 2025. And we’ll now happy to take any questions from the audience. Do have an appendix at the end of the presentation here. It gives you just a little biography of our management team, our very experienced management team, and then the reconciliation of the gap to adjusted net income is the final slide or the final part of the appendix. Okay.

Well, being no questions, again, thank you all for your time. We really appreciate it and are always happy to tell the OPFI story. Please feel free to reach out to Michael or myself with any questions that might follow-up. Thank

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