UPBD Cuts 2025 View Despite Reporting Q3 Earnings & Sales Beat

Upbound Group, Inc. UPBD has reported solid third-quarter 2025 results, wherein the top and bottom lines surpassed the Zacks Consensus Estimate. Also, UPBD’s revenues and earnings increased year over year.

However, the company has lowered its fiscal 2025 adjusted EBITDA and earnings per share (EPS) guidance due to margin compression in Acima from softer vintages and product mix shifts, weaker Rent-A-Center performance tied to a smaller store base, and integration costs from Brigit. The revision reflects a more cautious outlook amid evolving consumer conditions and a focus on disciplined, sustainable growth.

Upbound’s Quarterly Performance: Key Insights

UPBD posted adjusted earnings of $1.00 per share, surpassing the Zacks Consensus Estimate of 98 cents. The bottom line rose from 95 cents in the year-ago quarter.

Total revenues were $1,164.7 million, surpassing the consensus estimate of $1,144 million. The metric increased 9% year over year, driven primarily by higher rentals and fees revenue, increased merchandise sales and the continued contribution from Brigit, which the company acquired earlier in 2025.

Adjusted EBITDA totaled $123.6 million, up 5.7% from the prior-year period. The increase was primarily due to the addition of the Brigit segment, partially offset by a decline in adjusted EBITDA in the Rent-A-Center segment.

The company’s adjusted EBITDA margin was 10.6%, down 30 basis points from the year-ago quarter, mainly due to margin compression in the Acima segment, offset in part by the positive impact of Brigit’s inclusion.

UPBD’s Q3 Segmental Details

Revenues in the Rent-A-Center segment declined 4.7% year over year to $461.1 million, primarily reflecting a reduced number of company-owned stores during the third quarter of 2024 and a smaller portfolio entering the third quarter of 2025. Same-store sales decreased 3.6% year over year. The Zacks Consensus Estimate for the Rent-A-Center segment’s revenues was pegged at $443.9 million for the quarter.

Adjusted EBITDA for the Rent-A-Center segment was $74.7 million, compared with $79 million in the year-ago period. Lease charge-offs for company-owned stores were 4.7%, down 20 basis points year over year. As in recent quarters, Rent-A-Center’s financials now incorporate results from all franchised locations.

Revenues for the Acima segment increased 10.4% year over year to $625.3 million. The Zacks Consensus Estimate for the Acima segment’s revenues was pegged at $624.5 million. Applications grew approximately 13% year over year, while Gross Merchandise Volume (GMV) advanced 11% to $484 million. The improvement was supported by new merchant additions and strong growth in Acima’s expanding direct-to-consumer marketplace. GMV from Acima’s direct-to-consumer marketplace increased more than 150% year over year during the third quarter.

The adjusted EBITDA margin for Acima was 12%, down 130 basis points year over year, primarily due to softness in certain monthly vintages and shifts in product category mix. The lease charge-off rate improved 50 basis points year over year to 9.7%.

Brigit reported total revenues of $57.7 million, representing more than 40% year-over-year growth. Average monthly revenue per user rose 11.4% year over year to $13.74, due to increased expedited transfer revenue, stronger engagement with marketplace offers and an ongoing shift toward Brigit’s Premium tier. Paying subscribers grew 26.8% year over year. Cash advance volume reached $389.8 million, up 9.5% sequentially. Adjusted EBITDA came in at $9.3 million, yielding a margin of 16.1%.

The Zacks Rank #3 (Hold) company’s Mexico segment generated $20.7 million in revenues, up 7.4% on a constant-currency basis. Adjusted EBITDA totaled $1.9 million. As of Sept. 30, 2025, the segment operated 135 company-owned locations.

UPBD Stock's Past 3-Month Performance

Upbound’s Financial Health Snapshot

The company ended the third quarter with cash and cash equivalents of $107 million, net senior debt of $1.10 billion, and stockholders’ equity of $687.3 million.

UPBD’s 2025 Outlook

Revenues in 2025 are expected to be $4.60-$4.75 billion. Adjusted EBITDA (excluding stock-based compensation) is expected to be $500-$510 million compared with the previously stated $515-$535 million. Adjusted EPS are anticipated between $4.05 and $4.15 versus the prior mentioned $4.05-$4.40. The free cash flow is projected to be $150-$200 million.

The stock has gained 12% in the past three months against the industry’s decline of 4.5%.

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The Zacks Consensus Estimate for Urban Outfitters’ current fiscal-year earnings and sales indicates growth of 29.1% and 9.7%, respectively, from the year-ago actuals. URBN delivered a trailing four-quarter average earnings surprise of 24.8%.

Tilly's is a specialty retailer in the action sports industry, selling clothing, shoes and accessories. It currently has a Zacks Rank of 2.

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