Q4 2025 Bread Financial Holdings Inc Earnings Call Transcript
Key Points
- Bread Financial Holdings Inc (BFH) reported strong fourth quarter and full year 2025 results, meeting their expectations.
- The company signed seven major new brand partnerships in 2025, including Bed, Bath and Beyond, and renewed multiple existing partners.
- BFH's direct to consumer deposit balances increased 11% year over year, marking 20 consecutive quarters of growth.
- The company returned $350 million in capital to shareholders in 2025, including $310 million in common share repurchases.
- BFH received credit rating upgrades from Moody's and Fitch, reflecting improved financial resilience and risk management.
- Average loans decreased by 1% year over year, pressured by an increase in payment rates.
- Total non-interest expenses increased by $19 million or 4% in the fourth quarter, driven by higher impacts from debt repurchases.
- The net loss rate for 2025 was 7.7%, although better than expected, it remains a concern.
- Revenue growth is anticipated to be only in the low single-digits for 2026, indicating potential challenges in achieving higher growth.
- The company faces potential pressure on net interest income due to anticipated lower prime rates and lower build fees from improving delinquencies.
Good morning and welcome to the Bread Financial Fourth quarter 2025 earnings conference call. My name is Kevin and I'll be coordinating your call today. At this time, all parties have been placed on listen-only mode. Following today's presentation, the floor will be open for your questions. To register a question, please press 11. It is now my pleasure to introduce Mr. Brian Verreb, head of investor relations at Bread Financial. The floor is yours.
Thank you.
Copies of the slides we will be reviewing and the earnings release can be found on the investor relations section of our website at retfinancial.com. On the call today, we have Ralph Andreta, President and Chief Executive Officer, and Perry Bieberman, executive Vice President and Chief Financial Officer. Before we begin, I would like to remind you that some of the comments made on today's call and some of the responses to your questions may contain forward-looking statements. These statements are based on management's current
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