01—Abstract
Summary
Summary of the 10-Q filed October 22, 2025. Cited figures are marked; the original filing is the authoritative source.
Synchrony Financial reported net earnings of $1.1 billiona for the three months ended September 30, 2025, up from $789 million a year earlier, and $2.8 billion for the nine months, up from $2.7 billion.
The increases were primarily driven by lower provision for credit losses and higher net interest income, partially offset by higher retailer share arrangements. The prior-year nine-month period included an after-tax gain on sale related to Pets Best of $802 millionb. Provision for credit losses fell $451 million (28.2%) in the quarter and $1.4 billion (26.9%) for the nine months, reflecting reserve releases in 2025 versus reserve builds in 2024, along with lower net charge-offs.
The net charge-off rate was 5.16% for the quarter and 5.74% for the nine months, and over-30 day delinquencies improved to 4.39% of period-end loan receivables. Loan receivables declined 2.0% year over year to $100.2 billionc, reflecting lower purchase volume and higher payment rates. Net interest income rose 2.4% to $4.7 billion for the quarter, driven by lower interest expense as benchmark rates fell, while the loan receivables yield increased to 21.89%.
Deposits were $79.9 billiond, representing 85% of total funding sources. Other expense rose 5.0% in the quarter, mainly on employee costs and technology investments. Capital remained strong, with a common equity Tier 1 ratio of 13.7% and a total risk-based capital ratio of 16.9% at September 30, 2025.
Capital return remained a focus: the company repurchased $2.0 billion of common stock in the first nine months, and the Board approved an incremental $1.0 billion authorization in September 2025, leaving $2.1 billion remaining under the 2025 program. The quarterly common dividend was raised to $0.30 per share, and the company acquired Versatile Credit in October 2025.
02—Key points
Key Highlights
- Net earnings were $1.1 billion for Q3 2025 versus $789 million a year earlier, and $2.8 billion for the nine months versus $2.7 billion, driven mainly by lower credit provisions and higher net interest income.
- Provision for credit losses fell 28.2% to $1.1 billion in Q3, reflecting reserve releases of $152 million compared with reserve builds of $44 million in the prior-year quarter, as well as lower net charge-offs.
- Net charge-off rate improved to 5.16% for Q3 2025, down 90 basis points, and over-30 day delinquencies declined to 4.39% of period-end loan receivables from 4.78%.
- Loan receivables decreased 2.0% to $100.2 billion, while deposits of $79.9 billion funded 85% of total funding sources.
- Retailer share arrangements rose 12.0% to $1.0 billion in Q3 on lower net charge-offs and product, pricing and policy changes.
- Capital returns continued: $2.0 billion of common stock repurchased in the first nine months, a $1.0 billion incremental authorization approved in September 2025, and $2.1 billion remaining under the 2025 program.
- The company acquired Versatile Credit in October 2025, and agreed to acquire Lowe's commercial co-branded card portfolio with approximately $0.8 billion of loan receivables, expected to close in the first half of 2026.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-QQ3 FY2025filed October 22, 2025Financial Statements
Q3 FY2025 against Q3 FY2024
| Line item | Q3 FY2025Q3 FY2024 | Change |
|---|---|---|
| Net Income | $1.08B$789.00M | +36.5% |
| EPS (Basic) | $2.89$1.96 | +47.4% |
| EPS (Diluted) | $2.86$1.94 | +47.4% |
| Shares Outstanding (Basic) | 365.90M392.30M | −6.7% |
| Shares Outstanding (Diluted) | 369.90M396.50M | −6.7% |
05—Questions
Frequently Asked Questions
Why did Synchrony's earnings increase in the third quarter of 2025?
Net earnings rose to $1.1 billion from $789 million, primarily because the provision for credit losses decreased by $451 million, or 28.2%, driven by reserve releases in 2025 versus reserve builds in 2024, and by lower net charge-offs. Net interest income also increased 2.4% to $4.7 billion, mainly from lower interest expense. These gains were partially offset by higher retailer share arrangements.
How did credit quality trend?
Credit quality improved. The Q3 net charge-off rate was 5.16%, down 90 basis points from the prior year, and over-30 day delinquencies were 4.39% of period-end loan receivables, down from 4.78% a year earlier. The allowance coverage ratio decreased to 10.35% from 10.79%.
Why did loan receivables and purchase volume change?
Loan receivables decreased 2.0% to $100.2 billion from $102.2 billion a year earlier, reflecting lower purchase volume in the nine months ended September 30, 2025 and higher payment rates. Average loan receivables decreased 2.1% in the quarter, while purchase volume increased 2.3% in the quarter but decreased 1.0% for the nine months.
What is the company's capital and liquidity position?
At September 30, 2025, Synchrony Financial was well-capitalized, with a common equity Tier 1 capital ratio of 13.7%, a total risk-based capital ratio of 16.9% and a Tier 1 leverage ratio of 13.0%. The company had $18.2 billion of liquid assets and $10.0 billion of available Federal Reserve discount window capacity. The Bank's common equity Tier 1 ratio was 14.3%.
What are the key capital return actions for shareholders?
In the nine months ended September 30, 2025, the company repurchased $2.0 billion of common stock and paid common dividends of $0.85 per share totaling $321 million. The quarterly dividend increased to $0.30 per share starting in the second quarter of 2025, and the Board approved a $1.0 billion incremental repurchase authorization in September 2025, leaving $2.1 billion remaining under the 2025 program through June 30, 2026.
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