ENVA Q3 Deep Dive: Small Business Momentum and Credit Discipline Drive Profitability

Financial technology company Enova International (NYSE:ENVA) met Wall Street’s revenue expectations in Q3 CY2025, with sales up 16.3% year on year to $802.7 million. Its non-GAAP profit of $3.36 per share was 10.8% above analysts’ consensus estimates.

Is now the time to buy ENVA? Find out in our full research report (it’s free for active Edge members).

StockStory’s Take

Enova’s third quarter was marked by solid year-on-year growth and exceeded Wall Street’s non-GAAP profit expectations, with the market reacting positively to these results. Management attributed the performance to strong loan origination growth, especially in small business lending, and stable credit quality across the portfolio. CEO David Fisher highlighted the benefits of Enova’s online-only business model and its diversified product offerings, emphasizing that credit metrics remained healthy despite a complex macroeconomic environment. Fisher noted, “The strong origination growth produced a 20% year-over-year increase in our combined loan and finance receivables,” underlining the company’s operational agility and disciplined risk management.

Looking ahead, Enova’s leadership expects continued momentum in both small business and consumer lending, supported by robust demand and improving credit performance. Management anticipates a reacceleration in consumer loan originations, particularly in the line of credit product, as recent credit model adjustments have led to lower default rates. CFO Steven Cunningham stated, “We expect total company revenue to be 10% to 15% higher than the fourth quarter of 2024 as a result of strong SMB growth and a reacceleration of growth in our consumer portfolios.” Management also pointed to lower funding costs and ongoing efficiency gains as factors expected to support profitability in upcoming quarters.

Key Insights from Management’s Remarks

Management attributed the quarter’s results to significant growth in small business lending, operational efficiency, and swift credit model adjustments within the consumer segment.

• Small business lending growth: Enova’s small business products led the quarter, with originations rising 31% year-on-year, driven by strong brand presence and limited competition from traditional banks. Management cited high small business confidence, as 93% of surveyed owners anticipate growth in the coming year.
• Consumer credit model adjustments: The company quickly tightened credit standards in one consumer product following minor default upticks, which resulted in a return to normal credit performance and some of the lowest early default metrics observed. This enabled a renewed focus on expanding consumer lending.
• Operating leverage and efficiency: The online-only model allowed Enova to scale revenues while controlling expenses. Marketing costs were managed efficiently, coming in below guidance at 18% of revenue, and operating expenses dropped to 31% of revenue from 34% last year.
• Stable portfolio credit quality: Net charge-off ratios for both small business and consumer loans remained within expected ranges, reflecting the company’s disciplined approach to risk and the diversified nature of its portfolio.
• Leadership transition: Management confirmed that CFO Steven Cunningham will become CEO at the start of next year, with current Treasurer Scott Cornelius appointed as the new CFO. Leadership emphasized that the succession plan is designed to ensure continuity in the company’s growth strategy.

Drivers of Future Performance

Enova’s outlook is shaped by expectations for sustained loan demand, ongoing efficiency improvements, and stable credit metrics across both business segments.

• Consumer lending reacceleration: Management expects consumer loan originations, especially in the line of credit product, to increase in the next quarter as recent credit tightening has reduced defaults and improved portfolio quality.
• Small business demand resilience: The company anticipates continued robust demand for small business loans, supported by positive business sentiment and conservative bank lending standards, which open additional market share opportunities for Enova.
• Efficiency and funding cost tailwinds: Lower benchmark interest rates and improved credit spreads are expected to reduce funding costs, while the scalable online platform allows for further operating leverage, supporting non-GAAP earnings growth. Management also noted that marketing and operational expenses will remain a focus to sustain profitability.

Catalysts in Upcoming Quarters

Looking ahead, the StockStory team will be monitoring (1) the pace of consumer loan origination growth following credit model adjustments, (2) sustained strength and market share gains in small business lending as banks remain conservative, and (3) continued progress on operational efficiency and funding cost reduction. The execution of the planned leadership transition will also be a key area of focus.

Enova currently trades at $124.37, up from $113.88 just before the earnings. At this price, is it a buy or sell? Find out in our full research report (it’s free for active Edge members).

Now Could Be The Perfect Time To Invest In These Stocks

When Trump unveiled his aggressive tariff plan in April 2025, markets tanked as investors feared a full-blown trade war. But those who panicked and sold missed the subsequent rebound that’s already erased most losses.

Don’t let fear keep you from great opportunities and take a look at Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).

Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today.

StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.