Executive Summary

Q3 revenue beat Street while GAAP earnings swung to a loss due to a deliberate one-time partner payment; Open Lending posted $24.2M revenue vs S&P consensus $22.15M*, and reported GAAP diluted EPS of $(0.06) despite S&P “Primary EPS” of $0.03* vs $0.01* consensus, reflecting differing EPS bases . S&P Global data marked with *.
Mix quality improved: CU/Bank channel reached 89.8% of certs; profit share estimates benefited from a $1.1M positive CIE on historical vintages as management continued conservative booking of new-unit economics .
Strategic updates: Launch of ApexOne Auto (subscription decisioning for prime credit) adds a recurring-revenue vector and cross-sell to LPP; two customers already live; management sized a $30–40M revenue opportunity at ~50% adoption over time .
One-time $11M reseller amendment to Allied re-sets commission economics; expected >$2.5M annual cost savings once fully implemented in 2027; term extended to 2029 .
Q4 guide implies seasonal step-down in activity: total certified loans 21,500–23,500, with continuing underwriting discipline and OEM tightening; management sees 2025 as transition year and targets renewed growth in 2026 .

What Went Well and What Went Wrong

What Went Well

Raised quality/mix and stabilized back-book: “three consecutive quarters of positive Adjusted EBITDA and reduced volatility in backbook performance, including a positive CIE adjustment of $1.1M” .
Stronger CU/Bank mix and program-fee unit economics: CU/Bank certs rose to 89.8%; program fee per cert increased y/y to $558; management highlighted an 8% y/y increase in program fee unit economics .
New product catalyst: ApexOne Auto launched as a subscription-based, prime decisioning platform; two customers live; complementary with LPP and can route non-approved Apex loans into LPP .

What Went Wrong

GAAP loss on one-time item: Net loss $(7.6)M; OpEx +71% y/y on the $11M payment tied to allied reseller amendment; without it, OpEx was “relatively flat” y/y .
Volume softness by design: Certified loans fell to 23,880 from 27,435 y/y given tightened underwriting, especially in super-thin/credit-builder profiles; profit share revenue per cert declined to $310 from $502 y/y .
Macro credit backdrop remains tough: CEO cited >6% of below-prime auto loans 60+ DPD (industry-wide) at a record high, reinforcing the need for conservative booking and pricing .

Financial Results

Consolidated metrics vs prior quarters and estimates

Metric	Q1 2025	Q2 2025	Q3 2025	Q3 2025 Consensus/Actual
Revenue ($M)	24.393	25.310	24.169	22.152* est / 24.169 act*
Gross Profit ($M)	18.309	19.801	18.851	—
Gross Margin (%)	75.1% (calc from )	78.2% (calc from )	78.0% (calc from )	—
Net Income ($M)	0.617	1.034	(7.569)	—
Diluted EPS ($)	0.01	0.01	(0.06)	0.01* est / 0.03* act
Adjusted EBITDA ($M)	5.652	4.100	5.553	—
Adj. EBITDA Margin (%)	23%	16.2%	23.0%	—

S&P Global data marked with *; Values retrieved from S&P Global.

Revenue composition

Revenue Component ($M)	Q3 2024	Q2 2025	Q3 2025
Program fees	14.161	14.933	13.344
Profit share	6.822	7.969	8.470
Claims admin & other	2.493	2.408	2.355
Total Revenue	23.476	25.310	24.169

KPIs and unit economics

KPI	Q3 2024	Q2 2025	Q3 2025
Certified loans (certs)	27,435	26,522	23,880
CU/Bank mix (% of certs)	79.5%	88.9%	89.8%
OEM mix (% of certs)	20.5%	11.1%	10.2%
Avg profit share rev per cert ($)	502	289	310
Avg program fee rev per cert ($)	516	563	558
Originations volume ($000s)	772,469	783,327	701,678
Avg loan size ($)	28,156	29,535	29,384
New / Used mix (% of certs)	12.9 / 87.1	13.1 / 86.9	12.5 / 87.5
Indirect / Direct / Refi (% of certs)	77.3 / 19.5 / 3.2	75.3 / 18.8 / 5.9	74.4 / 19.8 / 5.8

Non-GAAP notes: Adjusted EBITDA excludes interest income beginning Q2’25 and certain other non-recurring expenses beginning Q3’25 (including the $11M Allied payment); see reconciliations .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Total certified loans	Q3 2025	22,500–24,500 (provided Aug 6)	Actual: 23,880 certs	—
Total certified loans	Q4 2025	—	21,500–23,500	Introduced
Partner economics (Allied reseller)	2027 run-rate	—	>$2.5M annual cost savings once fully implemented	Introduced

No revenue, margin, OpEx, tax, or dividend guidance was provided beyond the above.

Earnings Call Themes & Trends

Topic	Previous Mentions (Q1 & Q2 2025)	Current Period (Q3 2025)	Trend
Underwriting discipline/volatility reduction	Tightened credit box; super-thin files down to 0.3%; conservative unit economics; positive CIE in Q2 helped by MUVI 206.9	Three straight quarters of positive Adj. EBITDA; $1.1M positive CIE; super-thin/credit-builder negligible/new vintages booked conservatively	Improving/stabilizing
Channel mix & OEM	OEM share reduced; OEM3 pilot progressing	CU/Bank 89.8%; OEM ~10%; OEM3 ramping with CU-like loss performance expected	Mix shift to CU sustained
Refinance channel	Early signs of refi recovery as rates decline	Refi volumes “recovering”; could be tailwind into 2026	Gradual improvement
Pricing/modeling & data science	Segmented pricing; real-time TU data integration; exploring ML for claims	Ongoing third-party model recalibration; “muscle memory” tuning cadence; repossession servicing focus	Execution cadence established
Product expansion/tech	—	ApexOne Auto launched; subscription model; complements LPP; two customers live	New recurring-revenue vector
Macro/credit	Fed cuts in 2024 aided refi; tariffs could shift new/used mix	Below-prime 60+ DPD >6% industry-wide; management positioned book conservatively	Cautious backdrop persists
Carrier/insurance	Early extension with AmTrust to 2033	Noted ongoing carrier support; continued confidence	Stable capacity

Management Commentary

Strategy and stability: “We are…transitioning…to the new norm…less volatile profit-share unit economics…more segmented and sophisticated pricing changes.”
Product launch: “Apex One Auto…diversifies…adds a recurring revenue stream driven by subscription-based minimum application volumes…two customers [launched].”
Quality focus: “Our credit builder exposure has been reduced, and super thin files now comprise a negligible amount of new originations.”
Cost and partnership reset: “We amended our contract with Allied…a one-time payment of $11 million…will generate over $2.5 million in annual cost savings [in 2027].”
Liquidity/Leverage: “We exited Q3 with…$222.1M…in unrestricted cash…$134.4M in outstanding debt…$21M remaining on our share repurchase program.”

Q&A Highlights

ApexOne pricing model: Subscription-based with three-year contracts; monthly minimums plus per-loan overage; non-insurance, non-variable post-booking revenue .
Allied economics phasing: Cost savings begin modestly in 2H26 with the “lion’s share” realized in 2027; term extended through 2029 .
Q4 volume drivers: Seasonal low quarter; some uplift possible from refi; OEM strengthening effects still flowing through; CU/Bank ~90% of volume expected .
ApexOne TAM/uptake: With ~50% adoption across the base, management sized potential revenue at $30–40M; applicability beyond CU clients possible .
OEM mix guardrails: OEM1/2 targeted to remain <~10% of certs; OEM3 expected to perform like CU with ramp underway .

Estimates Context

Revenue beat: $24.169M actual vs $22.152M S&P consensus* (+~9% surprise). S&P Global data marked with *.
EPS: S&P “Primary EPS” $0.03* vs $0.01* consensus; note company reported GAAP diluted EPS of $(0.06), driven by the $11M one-time reseller payment; S&P’s “Primary/Normalized EPS” differs from GAAP presentation .
Implication: Street models likely raise revenue and potentially normalized EPS, while GAAP EPS may remain pressured near-term given conservative profit-share unit economics and cost actions. S&P Global data marked with *; Values retrieved from S&P Global.

Key Takeaways for Investors

Quality-over-quantity strategy is showing through: higher CU mix, improved program-fee units, reduced back-book volatility; this supports a more durable earnings profile as vintages season .
ApexOne Auto provides a second growth engine with recurring subscription revenue and cross-sell to LPP; early traction (two customers) and clear monetization mechanics are positives .
The $11M Allied payment reset near-term GAAP profitability but improves long-term unit economics via >$2.5M annual cost savings starting 2027; watch OpEx normalization into 2026 .
Q4 certs guide (21.5–23.5k) signals continued discipline and seasonal trough; management frames 2025 as a transition year with potential growth re-acceleration in 2026 (refi, OEM3, retention) .
Macro credit remains a headwind in below-prime; Open Lending’s conservative booking (implied ~72.5% loss ratio at origination) reduces future estimate volatility; eventual improvement could unlock positive CIEs .
Balance sheet is a buffer (>$220M cash, ~$134M debt) and buyback authorization ($21M remaining) offers capital deployment flexibility while investing in product and models .
Near-term trading setup: Revenue beat and ApexOne launch are positives; GAAP loss headlines could mute reaction. Focus on 2026 visibility (refi ramp, OEM3, ApexOne subs) and evidence of OpEx normalization.

Appendix: Source Documents

Q3 2025 8-K and Earnings Supplement (Press Release and Financials)
Q3 2025 Press Release (GlobeNewswire)
Q3 2025 Earnings Call Transcript
ApexOne Auto Launch Press Release
Q2 2025 8-K, Press Release, and Supplement
Q1 2025 Press Release and Financials

S&P Global consensus and actuals for estimates marked with *; Values retrieved from S&P Global.

Open Lending Corp (LPRO)·Q3 2025 Earnings Summary