Axos Financial, Inc. Reports Second Quarter Fiscal Year 2026 Results

LAS VEGAS--( BUSINESS WIRE)--Axos Financial, Inc. (NYSE: AX) (“Axos” or the “Company”) today announced unaudited financial results for the second fiscal quarter ended December 31, 2025. Net income was $128.4 million and diluted earnings per share (“EPS”) was $2.22 for the quarter ended December 31, 2025. Net income for the quarter ended December 31, 2024 was $104.7 million and diluted EPS was $1.80. Adjusted earnings and adjusted earnings per diluted common share (“Adjusted EPS”), non-GAAP measures described further below, increased $24.3 million to $130.2 million and increased $0.43 to $2.25, respectively, for the quarter ended December 31, 2025, compared to $105.8 million and $1.82, respectively, for the quarter ended December 31, 2024.

Second Quarter Fiscal 2026 Financial Summary

Three Months Ended

December 31,

(Dollars in thousands, except per share data)

2025

2024

% Change

Net interest income

331,709

280,099

18.4

Non-interest income

53,378

27,799

92.0

Net income

128,397

104,687

22.6

Adjusted earnings (Non-GAAP) 1

130,167

105,829

23.0

Diluted EPS

2.22

1.80

23.3

Adjusted EPS (Non-GAAP) 1

2.25

1.82

23.6

1 See “Use of Non-GAAP Financial Measures”

“Strong net interest income growth and a solid net interest margin resulted in a 23.3% year-over-year increase in our diluted earnings per share this quarter,” stated Greg Garrabrants, President and Chief Executive Officer of Axos. “Net interest income increased 14% linked quarter due to strong organic loan growth and positive contribution from a prepayment in our FDIC-purchased loans. Net ending loan balances increased by $1.6 billion linked quarter due to robust growth across several lending businesses, including commercial real estate specialty, capital calls, single-family warehouse and equipment leasing. Excluding the impact from the FDIC-purchased loan prepayment and the Verdant on-balance sheet securitizations, net interest margin for the three months ended December 31, 2025 was roughly flat linked quarter.”

“Non-interest income was $53.4 million for the quarter ended December 31, 2025, including $18.9 million related to operating lease rental and other income from Verdant, compared to $32.3 million in the prior quarter,” said Derrick Walsh, Chief Financial Officer of Axos. “Non-interest expenses in the quarter ended December 31, 2025 included approximately $14.8 million of non-cash depreciation and amortization expenses and $11 million of other expenses related to Verdant. Excluding these two Verdant items, non-interest expenses were relatively flat linked quarter.”

Other Highlights

Second Quarter Fiscal 2026 Income Statement Summary

Net income was $128.4 million and diluted EPS was $2.22 for the three months ended December 31, 2025, compared to net income of $104.7 million and diluted EPS of $1.80 for the three months ended December 31, 2024. Net interest income increased $51.6 million or 18.4% for the three months ended December 31, 2025, compared to the three months ended December 31, 2024, primarily due to an increase in interest income earned on loans, partially offset by an increase in interest expense on secured financings and other borrowings.

The provision for credit losses was $25.0 million for the three months ended December 31, 2025, compared to $12.2 million for the three months ended December 31, 2024. The provision for credit losses for the three months ended December 31, 2025, was primarily driven by loan growth and the impact of macroeconomic variables used in the allowance for credit losses model.

Non-interest income increased to $53.4 million for the three months ended December 31, 2025, compared to $27.8 million for the three months ended December 31, 2024. The increase was primarily due to higher banking and service fee income mainly attributable to operating lease rental and other income from the Verdant acquisition, and higher mortgage banking and servicing rights income.

Non-interest expense, comprised of various operating expenses, increased $39.3 million to $184.6 million for the three months ended December 31, 2025 from $145.3 million for the three months ended December 31, 2024. The increase was primarily due to higher depreciation and amortization, mainly attributable to the Verdant acquisition in the prior quarter, higher general and administrative expense, and higher salaries and related costs.

Balance Sheet Summary

Axos’ total assets increased by $3.4 billion, or 13.8%, to $28.2 billion, at December 31, 2025, from $24.8 billion at June 30, 2025, primarily attributable to an increase in loans and other assets, each mainly attributable to the Verdant acquisition in the prior quarter. Total liabilities increased by $3.2 billion, or 14.3%, to $25.3 billion at December 31, 2025, from $22.1 billion at June 30, 2025, primarily attributable to higher deposit balances, as well as secured financings attributable to the Verdant acquisition in the prior quarter. Stockholders’ equity increased $249.4 million, or 9.3%, to $2.9 billion at December 31, 2025 from $2.7 billion at June 30, 2025, primarily due to net income of $240.7 million.

Conference Call

A conference call and webcast will be held on Thursday, January 29, 2026, at 5:00 PM Eastern / 2:00 PM Pacific. Analysts and investors may dial in and participate in the question/answer session. To access the call, please dial: 877-407-8293. The conference call will be webcast live, and both the webcast and the earnings supplement may be accessed at Axos’ website, investors.axosfinancial.com. For those unable to listen to the live broadcast, a replay will be available until February 28, 2026 at Axos’ website and telephonically by dialing toll-free number 877-660-6853, passcode 13757841.

About Axos Financial, Inc. and Subsidiaries

Axos Financial, Inc., with approximately $28.2 billion in consolidated assets as of December 31, 2025, is the holding company for Axos Bank, Axos Clearing LLC and Axos Invest, Inc. Axos Bank provides consumer and business banking products nationwide through its low-cost distribution channels and affinity partners. Axos Clearing LLC (including its business division Axos Advisor Services), with approximately $44.4 billion of assets under custody and/or administration as of December 31, 2025, and Axos Invest, Inc., provide comprehensive securities clearing services to introducing broker-dealers and registered investment advisor correspondents, and digital investment advisory services to retail investors, respectively. Axos Financial, Inc.’s common stock is listed on the NYSE under the symbol “AX” and is a component of the Russell 2000® Index and the S&P SmallCap 600® Index, among other indices. For more information on Axos Financial, Inc., please visit http://investors.axosfinancial.com.

Segment Reporting

The Company operates through two segments: the Banking Business Segment and the Securities Business Segment. In order to reconcile the two segments to the consolidated totals, the Company includes corporate activities and intercompany eliminations. Inter-segment transactions are eliminated in consolidation and primarily include non-interest income earned by the Securities Business Segment and non-interest expense incurred by the Banking Business Segment for cash sorting fees related to deposits sourced from Securities Business Segment customers.

The following tables present the operating results of the segments:

For the Three Months Ended December 31, 2025

(Dollars in thousands)

Banking

Business Segment

Securities

Business Segment

Corporate/Eliminations

Axos

Consolidated

Net interest income

328,499

8,642

(5,432

)

331,709

Provision for credit losses

25,000

—

25,000

Non-interest income

32,812

30,171

(9,605

)

53,378

Non-interest expense

149,537

29,102

5,935

184,574

Income before income taxes

186,774

9,711

(20,972

)

175,513

For the Three Months Ended December 31, 2024

(Dollars in thousands)

Banking

Business Segment

Securities

Business Segment

Corporate/Eliminations

Axos

Consolidated

Net interest income

276,720

7,007

(3,628

)

280,099

Provision for credit losses

12,248

—

12,248

Non-interest income

2,948

29,004

(4,153

)

27,799

Non-interest expense

114,536

28,178

2,606

145,320

Income before income taxes

152,884

7,833

(10,387

)

150,330

For the Six Months Ended December 31, 2025

(Dollars in thousands)

Banking

Business Segment

Securities

Business Segment

Corporate/Eliminations

Axos

Consolidated

Net interest income

615,699

16,836

(9,776

)

622,759

Provision for credit losses

42,255

—

42,255

Non-interest income

45,187

59,628

(19,097

)

85,718

Non-interest expense

278,030

58,469

4,321

340,820

Income before income taxes

340,601

17,995

(33,194

)

325,402

For the Six Months Ended December 31, 2024

(Dollars in thousands)

Banking

Business Segment

Securities

Business Segment

Corporate/Eliminations

Axos

Consolidated

Net interest income

565,212

14,274

(7,339

)

572,147

Provision for credit losses

26,248

—

26,248

Non-interest income

11,538

58,906

(14,036

)

56,408

Non-interest expense

232,851

56,269

3,665

292,785

Income before income taxes

317,651

16,911

(25,040

)

309,522

Use of Non-GAAP Financial Measures

In addition to the results presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”), this release includes non-GAAP financial measures such as adjusted earnings, adjusted earnings per diluted common share, and tangible book value per common share. Non-GAAP financial measures have inherent limitations, may not be comparable to similarly titled measures used by other companies and are not audited. Readers should be aware of these limitations and should be cautious as to their reliance on such measures. Although we believe the non-GAAP financial measures disclosed in this release enhance investors’ understanding of our business and performance, these non-GAAP measures should not be considered in isolation, or as a substitute for GAAP basis financial measures.

We define “adjusted earnings”, a non-GAAP financial measure, as net income without the after-tax impact of non-recurring acquisition-related items (including amortization of intangible assets related to acquisitions) and other costs (unusual or non-recurring charges). Adjusted EPS, a non-GAAP financial measure, is calculated by dividing non-GAAP adjusted earnings by the average number of diluted common shares outstanding during the period. We believe the non-GAAP measures of adjusted earnings and Adjusted EPS provide useful information about Axos’ operating performance. We believe excluding the non-recurring acquisition-related costs and other costs provides investors with an alternative understanding of Axos’ core business.

Below is a reconciliation of net income, the nearest comparable GAAP measure, to adjusted earnings and adjusted EPS (Non-GAAP) for the periods shown:

For the Three Months Ended December 31,

For the Six Months Ended December 31,

(Dollars in thousands, except per share data)

2025

2024

2025

2024

Net income

128,397

104,687

240,749

217,027

Acquisition-related costs 1

2,419

1,645

5,360

4,199

Verdant acquisition - Provision for credit losses

—

7,765

—

Income tax effect

(649

)

(503

)

(3,415

)

(1,255

)

Adjusted earnings (Non-GAAP)

130,167

105,829

250,459

219,971

Average dilutive common shares outstanding

57,731,339

58,226,006

57,792,146

58,262,923

Diluted EPS

2.22

1.80

4.17

3.72

Acquisition-related costs 1

0.04

0.03

0.09

0.07

Verdant acquisition - Provision for credit losses

—

0.13

—

Income tax effect

(0.01

)

(0.01

)

(0.06

)

(0.02

)

Adjusted EPS (Non-GAAP)

2.25

1.82

4.33

3.77

1 Acquisition-related costs includes amortization of intangible assets, and for the six months ended December 31, 2025, also includes $1.3 million of acquisition-related costs associated with the Verdant acquisition.

We define “tangible book value”, a non-GAAP financial measure, as book value adjusted for goodwill and other intangible assets. Tangible book value is calculated using common stockholders’ equity minus servicing rights, goodwill and other intangible assets. Tangible book value per common share is calculated by dividing tangible book value by the common shares outstanding at the end of the period. We believe tangible book value per common share is useful in evaluating the Company’s capital strength, financial condition, and ability to manage potential losses.

Below is a reconciliation of total stockholders’ equity, the nearest comparable GAAP measure, to tangible book value per common share (non-GAAP) as of the dates indicated:

(Dollars in thousands, except per share amounts)

December 31,

2025

June 30,

2025

December 31,

2024

Common stockholders’ equity

2,930,092

2,680,677

2,521,962

Less: servicing rights, carried at fair value

25,431

27,218

28,045

Less: goodwill and other intangible assets—net

196,119

134,502

137,570

Tangible common stockholders’ equity (Non-GAAP)

2,708,542

2,518,957

2,356,347

Common shares outstanding at end of period

56,677,323

56,483,617

57,097,632

Book value per common share

51.70

47.46

44.17

Less: servicing rights, carried at fair value per common share

0.45

0.48

0.49

Less: goodwill and other intangible assets—net per common share

3.46

2.38

2.41

Tangible book value per common share (Non-GAAP)

47.79

44.60

41.27

Forward-Looking Safe Harbor Statement

This press release contains forward-looking statements that involve risks and uncertainties, including without limitation statements relating to Axos’ financial prospects and other projections of its performance and asset quality, Axos’ deposit balances and capital ratios, Axos’ ability to continue to grow profitably and increase its business, Axos’ ability to continue to diversify its lending and deposit franchises, the anticipated timing and financial performance of other offerings, initiatives, and acquisitions, expectations of the environment in which Axos operates and projections of future performance. These forward-looking statements are made on the basis of the views and assumptions of management regarding future events and performance as of the date of this press release. Actual results and the timing of events could differ materially from those expressed or implied in such forward-looking statements as a result of risks and uncertainties, including without limitation Axos’ ability to successfully integrate acquisitions and realize the anticipated benefits of the transactions, changes in the interest rate environment, monetary policy, inflation, tariffs, government regulation, general economic conditions, changes in the competitive marketplace, conditions in the real estate markets in which we operate, risks associated with credit quality, our ability to attract and retain deposits and access other sources of liquidity, and the outcome and effects of litigation and other factors beyond our control. These and other risks and uncertainties detailed in Axos’ periodic reports filed with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the fiscal year ended June 30, 2025, could cause actual results to differ materially from those expressed or implied in any forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Axos undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. All written and oral forward-looking statements made in connection with this press release, which are attributable to us or persons acting on Axos’ behalf are expressly qualified in their entirety by the foregoing information.

AXOS FINANCIAL, INC.

SELECTED CONSOLIDATED FINANCIAL INFORMATION

(Unaudited – dollars in thousands)

December 31,

2025

June 30,

2025

December 31,

2024

Selected Balance Sheet Data:

Total assets

28,201,406

24,783,078

23,709,422

Loans—net of allowance for credit losses

24,272,552

21,049,610

19,486,727

Loans held for sale, carried at fair value

18,826

10,012

25,436

Allowance for credit losses

327,043

290,049

270,605

Trading securities

880

649

241

Available-for-sale securities

811,126

66,008

97,848

Securities borrowed

109,141

139,396

114,672

Customer, broker-dealer and clearing receivables

277,308

252,720

298,887

Total deposits

23,232,748

20,829,543

19,934,904

Advances from the Federal Home Loan Bank

60,000

90,000

Secured financings

691,507

—

Borrowings, subordinated notes and debentures

364,814

312,671

358,692

Securities loaned

128,869

139,426

135,258

Customer, broker-dealer and clearing payables

358,727

350,606

309,593

Total stockholders’ equity

2,930,092

2,680,677

2,521,962

Common shares outstanding at end of period

56,677,323

56,483,617

57,097,632

Common shares issued at end of period

71,419,706

71,101,642

70,571,332

Per Common Share Data:

Book value per common share

51.70

47.46

44.17

Tangible book value per common share (Non-GAAP) 1

47.79

44.60

41.27

Capital Ratios:

Equity to assets at end of period

10.39

10.82

10.64

Axos Financial, Inc.:

Tier 1 leverage (to adjusted average assets)

9.80

10.73

10.02

Common equity tier 1 capital (to risk-weighted assets)

11.65

12.52

12.42

Tier 1 capital (to risk-weighted assets)

11.65

12.52

12.42

Total capital (to risk-weighted assets)

14.39

15.28

15.23

Axos Bank:

Tier 1 leverage (to adjusted average assets)

9.15

10.23

9.85

Common equity tier 1 capital (to risk-weighted assets)

11.12

12.42

12.67

Tier 1 capital (to risk-weighted assets)

11.12

12.42

12.67

Total capital (to risk-weighted assets)

12.37

13.70

13.86

Axos Clearing LLC:

Net capital

94,673

86,996

83,932

Excess capital

88,369

81,834

78,282

Net capital as a percentage of aggregate debit items

30.04

33.71

29.71

Net capital in excess of 5% aggregate debit items

78,913

74,091

69,805

AXOS FINANCIAL, INC.

SELECTED CONSOLIDATED FINANCIAL INFORMATION

(Unaudited – dollars in thousands, except per share data)

As of or for the

Three Months Ended

As of or for the

Six Months Ended

December 31,

(Dollars in thousands, except per share data)

2025

2024

2025

2024

Selected Income Statement Data:

Interest and dividend income

513,845

456,068

979,581

940,330

Interest expense

182,136

175,969

356,822

368,183

Net interest income

331,709

280,099

622,759

572,147

Provision for credit losses

25,000

12,248

42,255

26,248

Net interest income, after provision for credit losses

306,709

267,851

580,504

545,899

Non-interest income

53,378

27,799

85,718

56,408

Non-interest expense

184,574

145,320

340,820

292,785

Income before income taxes

175,513

150,330

325,402

309,522

Income tax expense

47,116

45,643

84,653

92,495

Net income

128,397

104,687

240,749

217,027

Weighted average number of common shares outstanding:

Basic

56,660,833

57,094,153

56,586,710

57,014,412

Diluted

57,731,339

58,226,006

57,792,146

58,262,923

Per Common Share Data:

Net income:

Basic

2.27

1.83

4.25

3.81

Diluted

2.22

1.80

4.17

3.72

Adjusted earnings per common share (Non-GAAP) 1

2.25

1.82

4.33

3.77

Performance Ratios and Other Data:

Growth in loans held for investment, net

1,637,415

206,118

3,222,942

255,342

Loan originations for sale

61,009

66,826

108,131

136,396

Return on average assets

1.83

1.74

1.80

1.83

Return on average common stockholders’ equity

17.44

16.97

16.70

18.02

Interest rate spread 2

4.17

3.91

4.03

4.01

Net interest margin 3

4.94

4.83

4.85

5.00

Net interest margin 3 – Banking Business Segment

5.02

4.87

4.91

5.04

Efficiency ratio 4

47.93

47.20

48.11

46.58

Efficiency ratio 4 – Banking Business Segment

41.39

40.95

42.07

40.37

Asset Quality Ratios:

Net annualized charge-offs to average loans

0.04

0.10

0.07

0.13

Non-accrual loans to total loans

0.61

1.26

0.61

1.26

Non-performing assets to total assets

0.56

1.06

0.56

1.06

Allowance for credit losses - loans to total loans held for investment

1.33

1.37

1.33

1.37

Allowance for credit losses - loans to non-accrual loans 5

215.81

107.58

215.81

107.58

See “Use of Non-GAAP Financial Measures.”

Interest rate spread represents the difference between the annualized weighted average yield on interest-earning assets and the annualized weighted average rate paid on interest-bearing liabilities.

Net interest margin represents annualized net interest income as a percentage of average interest-earning assets.

Efficiency ratio represents non-interest expense as a percentage of the aggregate of net interest income and non-interest income.

The increase in the Allowance for credit losses - loans to nonaccrual loans is primarily attributable to the increase in the ACL, including the impact of the Verdant acquisition.