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FirstCash Holdings, Inc. (FCFS)·Q2 2025 Earnings Summary

Executive Summary

  • Q2 2025 delivered strong earnings growth despite flat revenue: GAAP diluted EPS rose 24% YoY to $1.34 and adjusted diluted EPS rose 31% YoY to $1.79; adjusted EBITDA increased 19% YoY to $145.1M .
  • Revenue was $830.6M (+0% YoY), with beats vs Wall Street on both adjusted EPS ($1.79 vs $1.67) and revenue ($830.6M vs $822.6M); AFF profitability improved and pawn margins stayed robust in the U.S. . EPS and revenue estimate figures retrieved from S&P Global*.
  • Guidance was raised: U.S. pawn fee growth 10–12% (prior 9–11%), U.S. retail sales “high single digit” (prior mid-single digit), LatAm outlook improved (flat to slightly up in USD; 10–12% local currency fees), AFF net revenue decline narrowed to 6–8% (prior 8–12%) .
  • Board increased quarterly dividend 11% to $0.42 (annualized $1.68); closing of H&T Group acquisition targeted by end of Q3 2025, creating >3,300 locations across U.S., LatAm, and U.K., a potential near-term stock catalyst .

What Went Well and What Went Wrong

What Went Well

  • U.S. pawn posted record segment pre-tax income of $98.3M (+8% YoY) with retail sales margins up to 43% (42% prior-year); same-store pawn receivables rose 13% YoY, sustaining demand .
  • LatAm pawn earnings rose 10% YoY to a record $41.0M despite a 13% FX headwind; on local currency basis earnings +22%, margins at 20% (18% prior-year) .
  • AFF segment pre-tax income rose 46% YoY to $37.9M on gross margin improvement and 31% lower operating expenses; origination volume +3% YoY overall, +34% YoY excluding bankrupt furniture partners (Conn’s, American Freight) .

“Operating performance across all business segments continues to be incredibly strong… adjusted EBITDA for the trailing twelve months exceeding $600 million for the first time” — CEO Rick Wessel .

What Went Wrong

  • Consolidated revenue was flat YoY (+0%), with LatAm reported in USD pressured by unfavorable MXN/USD exchange rates (average 19.5 vs 17.2 prior-year) .
  • AFF gross revenues fell 14% YoY due to 2024 bankruptcies of large furniture partners; leased merchandise net charge-off rates increased as expected given reduced new lease originations (6.2% vs 5.4% prior-year) .
  • GAAP results included a CFPB settlement charge reflected in Q2 GAAP results; adjusted EPS excludes the settlement ($11.0M pre-tax; $0.21 per share after tax) .

Financial Results

MetricQ4 2024Q1 2025Q2 2025
Revenue ($USD Millions)$883.8 $836.4 $830.6
Diluted EPS (GAAP) ($)$1.86 $1.87 $1.34
Diluted EPS (Adjusted) ($)$2.12 $2.07 $1.79
Adjusted EBITDA ($USD Millions)$165.7 $162.9 $145.1
Actual vs Consensus (S&P Global)Q1 2025Q2 2025
Adjusted/Primary EPS ($)$2.07 vs $1.738*$1.79 vs $1.67*
Revenue ($USD Millions)$836.4 vs $835.6*$830.6 vs $822.6*

Values retrieved from S&P Global*.

Segment Breakdown (Q2 2025)

SegmentRevenue ($USD Millions)Segment Pre-tax Operating Income ($USD Millions)Margin
U.S. Pawn$409.6 $98.3 24%
LatAm Pawn$205.9 $41.0 20%
AFF (Retail POS Payment Solutions)$215.9 $37.9 n/a

Selected KPIs (Q2 2025)

KPIU.S. PawnLatAm PawnAFF
Same-store pawn receivables YoY+13% +10% USD; +13% local currency n/a
Retail sales margin43% (42% prior-year) 36% (unchanged) n/a
Inventory aged >1 year2% 1% n/a
Active merchant partner locationsn/an/a~15,300 (+19% YoY)
Provision rate (lease/loan)n/an/aLease 30%; Loan 28%
Delinquency raten/an/aLease 23.2%; Loan 20.6%

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
U.S. pawn fee growthFY 20259%–11% 10%–12% Raised
U.S. retail sales growthFY 2025Mid single-digit High single-digit Raised
U.S. retail sales marginFY 2025~41%–42% Upper end of 41%–42% Tightened higher
LatAm pawn fee growth (local currency)FY 202510%–12% 10%–12% Maintained
LatAm pawn fee growth (USD)FY 2025Flat to down slightly Flat to up slightly Improved
LatAm retail sales (USD)FY 2025Track pawn fees; margin consistent Track pawn fees; margin consistent Maintained
AFF net revenues YoYFY 2025Decline 8%–12% Decline 6%–8% Improved
AFF originations YoY ex-furnitureFY 2025+20%–25% +20%–25% Maintained
AFF operating expensesH2 2025Consistent with Q1 run-rate Consistent with Q2 run-rate Maintained
Effective tax rateFY 202524.5%–25.5% 24.5%–25.5% Maintained
DividendQ3 2025$0.38 (prior) $0.42 (+11%) Raised

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4 2024 and Q1 2025)Current Period (Q2 2025)Trend
Macro/currency (MXN/USD)FX pressure reduced LatAm reported USD results; constant currency growth intact Average MXN/USD 19.5 vs 17.2 prior-year; improved outlook as peso strengthened since Q1 Headwind easing
Regulatory/legalCFPB lawsuit was outstanding ; still referenced in risk disclosures CFPB settlement reached; ~$5–$7M redress plus $4M fine; reflected in Q2 GAAP results Resolved (financial impact captured)
Retail margin disciplineU.S. margins 42% Q1; strong pricing/layaway benefits U.S. margins improved to 43%; LatAm stable at 36% Strengthening margins
Merchant partner diversification (AFF)Door counts +17–19%; growth in non-furniture verticals Active doors ~15,300 (+19% YoY); strong growth in elective medical and auto services Diversifying and expanding
Store growth99 stores added in 2024; ongoing pipeline +13 stores in Q2; +25 YTD; real estate purchases for 14 stores; total locations 3,027 Continued expansion
Tariffs/macro sensitivityLimited direct impact from tariffs cited Demand from value-conscious consumers driving retail and pawn growth Resilient demand

Management Commentary

  • “The U.S. pawn segment has now recorded eight consecutive quarters of double-digit growth in same-store receivables… we remain disciplined in managing loan-to-value ratios as evidenced by the improved U.S. retail margins in the second quarter.” — CEO Rick Wessel .
  • “This trend continued to accelerate, with same-store pawn loan originations in Mexico up over 20% over the last thirty days… improved exchange rate… reduced previously anticipated currency headwinds.” — CEO Rick Wessel .
  • “AFF now has over 15,000 active doors… profitability for AFF has been especially strong in the first half of the year.” — CEO Rick Wessel .
  • “H&T… will expand FirstCash’s geographic footprint into a new and attractive market… enhanced scale, operating efficiencies and long-term growth opportunities.” — CEO Rick Wessel .

Q&A Highlights

No earnings call transcript was available in the document set for Q2 2025; management commentary above reflects prepared remarks from the earnings press release .

Estimates Context

  • Adjusted/Primary EPS beat: $1.79 vs $1.67 consensus for Q2; Q1 beat was $2.07 vs $1.74 consensus*.
  • Revenue beat: $830.6M vs $822.6M consensus in Q2; Q1 was $836.4M vs $835.6M*.
  • Estimate breadth: Q2 had 5 EPS and 5 revenue estimates; Q1 had 6 for each*.
  • Given improved guidance (U.S. pawn, LatAm, AFF net revenues), Street models likely need to raise FY revenue and EPS trajectories, especially for pawn-driven segments .

Values retrieved from S&P Global*.

Key Takeaways for Investors

  • Pawn-led earnings engine is accelerating: U.S. margins up to 43%, same-store receivables +13% in both U.S. and LatAm local currency; segment income now expected to be >80% of total for 2025 .
  • Guidance upgrades across U.S. pawn, LatAm revenue, and AFF net revenues point to upward estimate revisions; Q2 delivered beats on EPS and revenue vs consensus . EPS and revenue estimate figures retrieved from S&P Global*.
  • AFF profitability inflecting despite furniture partner bankruptcies; cost actions and portfolio reserve releases drove 46% YoY segment income growth while broadening into non-furniture verticals .
  • Capital allocation remains supportive: dividend raised 11% to $0.42 and trailing 12-month operating cash flow reached $555M; leverage improved to 2.6x net debt/adjusted EBITDA .
  • FX risk moderating: recent peso strength and sustained local currency growth in Mexico improve the LatAm USD outlook vs Q1 .
  • Strategic catalyst: expected closing of H&T by end of Q3 2025 adds a new European footprint and scale; funded via revolver, increasing long-term growth optionality .
  • Non-GAAP adjustments matter: Q2 adjusted EPS excludes the CFPB settlement ($11M pre-tax; $0.21 per share), AFF purchase accounting adjustments, and M&A expenses—use adjusted metrics when evaluating core earnings power .
* Values retrieved from S&P Global