FirstCash Holdings, Inc. (FCFS)·Q1 2025 Earnings Summary

Executive Summary

• Record Q1 results with consolidated revenue of $836.4M, GAAP EPS $1.87, and adjusted EPS $2.07; GAAP EPS up 39% y/y and adjusted EPS up 34% as pawn strength offset AFF top-line headwinds .
• EPS decisively beat Wall Street consensus ($2.07 vs $1.738*), while revenue was in line ($836.4M vs $835.6M*). Drivers: U.S. pawn pre-tax income +17% to $113M on robust loan demand and 42% retail margin; AFF pre-tax income +58% on lower depreciation/provisioning and 30% opex reduction .
• 2025 outlook improved: AFF segment income raised to mid single‑digit growth (from flat to slightly down), AFF full‑year net revenue decline narrowed to 8–12% (from 10–15%); U.S. pawn fee growth guided to 9–11% with mid‑single digit retail growth and 41–42% margins .
• Capital allocation remains active: $60M of Q1 buybacks (525k shares at ~$113.54), $0.38 dividend, net debt/adj. EBITDA 2.68x; 12 pawn locations added and seven U.S. store real estate purchases .
• Subsequent event: agreement to acquire H&T Group plc for £297M equity value ($394M), billed as meaningfully accretive to EBITDA and EPS and expanding into the UK; expected close 2H25 pending approvals .

Note: *Values retrieved from S&P Global.

What Went Well and What Went Wrong

• What Went Well

  • U.S. pawn outperformance: pre‑tax operating income rose 17% to a record $113M with 27% pre‑tax margin; same‑store pawn receivables +13% and retail margins 42% .
  • AFF profit quality: segment pre‑tax income +58% as net revenue +12% on lower depreciation/credit provisioning and 30% lower opex; provision rates and charge‑offs tracked favorably vs last year .
  • Cash returns and balance sheet: $60M buybacks, ongoing dividend, and leverage down to 2.68x net debt/adj. EBITDA on TTM basis .

• What Went Wrong

  • FX headwind in LatAm: average MXN weakened ~20% y/y, cutting reported growth; LatAm pre‑tax income -2% in USD (+13% cc), retail margin 35% vs 36% y/y .
  • AFF top‑line: gross revenues -12% y/y on lower LTO and finance fee mix despite profitability improvement; origination volumes down 8% including impact of 2024 furniture bankruptcies .
  • Expense pressures: U.S. pawn opex +8% on store growth and labor/variable comp; LatAm constant‑currency opex +8% y/y partly from higher minimum wage and inflation .

Financial Results

Consolidated results (USD millions, except per-share)

Estimate vs actual (Q1 2025)

Note: *Values retrieved from S&P Global.

Segment pre‑tax operating income (USD millions) and selected margins

Key KPIs

Non‑GAAP adjustments (Q1 2025): adjusted EPS excludes ~$0.21 per share of AFF purchase accounting and other adjustments; minor net other items; no M&A expense per share in Q1 .

Guidance Changes

Earnings Call Themes & Trends

Note: A Q1 2025 earnings call transcript was not available in our document corpus; themes below synthesize management commentary from the 8‑K/press release and prior quarter materials.

Management Commentary

• “FirstCash posted record first quarter results, driven by the continued revenue and earnings growth from core pawn operations coupled with strong operating margins in the AFF POS payment solutions segment.”
• “Total outstanding pawn loans at the end of the quarter were up 16% in the U.S. and 15% in Latin America, on a local currency basis, while the average loan amounts were up 11% in the U.S and 7% in Latin America.”
• “While [AFF] revenues declined slightly as expected, we more than offset the impact with strong collection results on the existing portfolios and reduced operating expenses… our resulting outlook for 2025 earnings is improved.”
• “The 525,000 shares repurchased in the first quarter for $60 million were executed at an average price of less than $114 per share… we reduced outstanding debt on our revolving credit facility by $23 million and decreased the leverage ratio during the quarter.”

Q&A Highlights

• No public Q1 2025 earnings call transcript was located in our document set; guidance clarifications are drawn from the 8‑K and press release disclosures .

Estimates Context

• EPS materially beat S&P Global consensus ($2.07 vs $1.738*), driven by U.S. pawn strength and AFF margin improvements; revenue was effectively in line ($836.4M vs $835.6M*). Expect estimate revisions to reflect raised AFF earnings outlook and sustained U.S. pawn momentum .
• Subsequent H&T acquisition announcement (accretive to EBITDA/EPS) may prompt medium‑term model updates for international expansion and capital structure .

Note: *Values retrieved from S&P Global.

Key Takeaways for Investors

• U.S. pawn remains the core engine (record $113M pre‑tax OI; 27% margin) with robust same‑store demand and resilient 42% retail margin—a durable driver for FY25 EPS trajectory .
• LatAm underlying growth is strong but masked by MXN; cc growth suggests potential upside if FX stabilizes—watch MXN sensitivity (~$0.10 EPS per 1‑pt move) .
• AFF pivoted from revenue to earnings quality: lower depreciation/credit cost and 30% opex cuts supported a 58% jump in pre‑tax income; FY guide raised—key to consolidating EPS beats even with lower net revenue .
• Capital deployment is active (buybacks + dividend) while leverage declined to 2.68x—providing optionality for continued store real estate buys and tuck‑in M&A .
• The proposed H&T acquisition adds a third pawn geography (UK) with stated EPS/EBITDA accretion, a multi‑year scale catalyst pending approvals (2H25 close) .
• Risks: FX in Mexico, wage inflation in LatAm, furniture vertical normalization at AFF, and regulatory matters (CFPB) remain watch items .
• Near‑term trading setup: positive EPS surprise and raised AFF outlook are supportive; monitor Q2 AFF net revenue cadence (-14% to -16% y/y guide) and U.S. pawn same‑store loan trends for continuation signals .