LendingClub (LC) Q3 2024 earnings summary

Executive summary

• Achieved strong Q3 2024 results with $1.9B in originations, 8% revenue growth to $201.9M, and net income of $14.5M ($0.13/share), up 189% year-over-year, driven by robust loan demand and a $1.3B portfolio acquisition.

• Book value per share increased to $11.95, with tangible book value per share up 10% year-over-year to $11.19.

• Deposits grew 17% sequentially and 35% year-over-year, with 88% FDIC-insured.

• Acquired Tally's credit card debt management technology in October to accelerate product roadmap and enhance member engagement.

• Launched LevelUp Savings, gathering $500M in deposits in two months and receiving positive consumer response.

Financial highlights

• Total net revenue was $201.9M, up 8% sequentially and 1% year-over-year, with net interest income at $140.2M, driven by the loan portfolio purchase.

• Pre-Provision Net Revenue (PPNR) reached $65.5M, up 19% sequentially but down 10% year-over-year.

• Provision for credit losses was $47.5M, up 34% sequentially but down 26% year-over-year.

• Net charge-off ratio improved to 5.4% from 6.2% sequentially; allowance for loan and lease losses to total loans was 5.4% at quarter end.

• Non-interest expense increased 3% sequentially and 6% year-over-year, mainly due to higher marketing and depreciation.

Outlook and guidance

• Q4 2024 originations expected between $1.8B and $1.9B, with PPNR guidance of $60M–$70M and continued positive net income.

• Plans to retain $550M–$650M of held-for-investment loans per quarter until originations accelerate after Q1 2025.

• Management expects 2024 capital expenditures of $60M, focused on digital platform development.

• Liquidity is considered sufficient for the next twelve months and beyond, supported by cash, liquid securities, and borrowing capacity.