WAFD Stock Falls as Q4 Earnings Miss Estimates, Revenues Decline Y/Y

Shares of WaFd, Inc. WAFD lost 2.8% in after-hours trading following the announcement of its fourth quarter and fiscal full-year 2025 results. Fourth-quarter fiscal 2025 (ended Sept. 30) earnings of 72 cents per share missed the Zacks Consensus Estimate of 75 cents. However, the bottom line increased 1.4% year over year.

Results were primarily hurt by a decline in net interest income (NII) and higher provisions. A sequential decline in the loan balance was another headwind. However, a rise in non-interest income and lower expenses supported results to some extent.

Quarterly net income available to common shareholders was $56.9 million, down 1% from the prior-year quarter. Our estimate for the metric was $56.8 million.

Full-year earnings per share of $2.63 missed the Zacks Consensus Estimate of $2.73. The bottom line grew 5.2% year over year. Net income available to common shareholders was $211.4 million, up 14% from the previous year. Our estimate for the metric was $211.3 million.

WaFd’s Revenues & Expenses Decline

Quarterly net revenues were $188.3 million, down marginally from the prior-year quarter. The top line missed the Zacks Consensus Estimate of $190.2 million.

Full-year net revenues were $725.5 million, up marginally from the previous year. The top line missed the Zacks Consensus Estimate of $727.4 million.

NII for the quarter was $169.9 million, declining 1.7% year over year. Then again, the net interest margin (NIM) rose 9 basis points (bps) to 2.71%. Our estimates for NII and NIM were $172.3 million and 2.69%, respectively.

The total non-interest income of $18.4 million rose 15.8% year over year. Our estimate for the metric was $18 million.

Total non-interest expenses were $107 million, falling 1% year over year. The fall was due to a decrease in FDIC insurance premiums and other expenses. Our estimate for the metric was $105.8 million.

The company’s efficiency ratio was 56.82%, down from 57.21% in the prior-year quarter. A fall in the efficiency ratio reflects improved profitability.

At the end of the fiscal fourth quarter, the return on average common equity was 8.36%, down from 8.53% at the end of the prior-year quarter. Return on average assets was 0.91%, increasing from 0.87%.

WAFD’s Loans Decline, Deposits Increase Marginally

As of Sept. 30, 2025, net loans receivable were $20.09 billion, down 1% from the prior quarter. We projected the metric to be $20.72 billion.

Total customer deposits were $21.44 billion, up marginally from the previous quarter’s end. Our estimate for the metric was $21.71 billion.

WaFd’s Credit Quality Worsens

As of Sept. 30, 2025, allowance for credit losses (including reserve for unfunded commitments) was 1.04% of gross loans outstanding, up from 1.01% in the prior-year quarter. The ratio of non-performing assets to total assets was 0.54%, up from 0.28%.

In the reported quarter, the provision for credit losses was $3 million, as against no provisions in the year-ago quarter.

Update on WAFD’s Share Repurchases

In the reported quarter, WAFD repurchased 0.97 million shares at an average price of $29.74 per share.

Our View on WAFD

Relatively higher interest rates, business restructuring and decent balance sheet position are likely to continue aiding WAFD’s financials. However, a tough macroeconomic backdrop is a near-term headwind for the company.

WaFd, Inc. Price, Consensus and EPS Surprise

 

WaFd, Inc. price-consensus-eps-surprise-chart | WaFd, Inc. Quote

Currently, WAFD carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

Performance of Other Banks

Hancock Whitney Corp.’s HWC third-quarter 2025 earnings per share of $1.49 exceeded the Zacks Consensus Estimate of $1.41. Further, the bottom line rose 12% from the prior-year quarter.

HWC’s results benefited from an increase in non-interest income and NII, alongside lower provisions. Also, higher loans were another positive. However, higher adjusted expenses and lower deposit balances were headwinds.

The Bank of New York Mellon Corporation’s BK third-quarter 2025 adjusted earnings of $1.91 per share surpassed the Zacks Consensus Estimate of $1.76. Also, the bottom line reflected a jump of 25.7% from the prior-year quarter.

Results were primarily aided by a rise in fee revenues and NII. BNY Mellon recorded a provision benefit in the quarter, which was a tailwind. Growth in assets under custody and/or administration further supported the results. However, higher expenses and a lower assets under management balance were the undermining factors for BK.

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This article originally published on Zacks Investment Research (zacks.com).

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