01—Abstract
Summary
Summary of the 10-Q filed October 22, 2026. Cited figures are marked; the original filing is the authoritative source.
Synchrony Financial (SYF) reported net earnings of $892 milliona for the three months ended September 30, 2026, down from $1.08 billion a year earlier, and $2.58 billion for the nine months, down from $2.80 billion.
The filing attributes the decline mainly to higher other expense (up $123 millionb for the quarter, driven by operational losses, technology costs and marketing), a higher provision for credit losses (up $120 million for the quarter, reflecting a reserve build versus a prior-year release), and higher retailer share arrangements, partly offset by net interest income growth of $89 million for the quarter. Net interest margin was 15.50% for the quarter versus 15.62% a year earlier, and the efficiency ratio rose to 35.9% from 32.6%. Credit quality improved on most measures.
Net charge-offs fell to 4.79% of average loan receivables for the quarter from 5.16%, the over-30 day delinquency rate eased to 4.34% from 4.39%, and management expects the full-year 2026 net charge-off rate to be below its 5.5% to 6.0% long-term target range. Loan receivables grew 3.2% year over year to $103.3 billionc, helped by partner expansion and the April 2026 acquisition of the Lowe's commercial co-branded card portfolio ($0.7 billion). Deposits reached $83.0 billion, representing 83% of total funding sources.
Capital returns remained significant. The company repurchased $2.9 billiond of common stock in the first nine months of 2026, and the Board approved a quarterly dividend increase to $0.34 per share, effective in the third quarter. The remaining authorization under the new $6.5 billion, no-expiration repurchase program was $4.6 billion at quarter-end.
Standardized common equity Tier 1 capital ratio declined to 12.9% from 13.5% at year-end 2025, which the filing attributes to buybacks and dividends exceeding net earnings. S&P assigns Synchrony Financial a positive outlook, and Fitch a stable outlook.
02—Key points
Key Highlights
- Net earnings were $892 million for Q3 2026, down from $1.08 billion in Q3 2025; diluted EPS was $2.68 versus $2.86.
- Other expense rose 9.9% to $1.37 billion in the quarter, driven by higher operational losses, technology investment costs and marketing; the efficiency ratio increased to 35.9% from 32.6%.
- Provision for credit losses increased $120 million to $1.27 billion in Q3, reflecting a $30 million reserve build versus a $152 million release a year earlier, partly offset by lower net charge-offs.
- Net charge-off rate improved to 4.79% for Q3 from 5.16%, and the over-30 day delinquency rate eased to 4.34%; management expects the full-year 2026 charge-off rate to fall below its 5.5% to 6.0% long-term target.
- Loan receivables rose 3.2% year over year to $103.3 billion, with purchase volume up 8.0% in the quarter, supported by partner expansion and the Lowe's commercial card acquisition.
- Synchrony repurchased $2.9 billion of common stock in the first nine months of 2026, with $4.6 billion of authorization remaining, and raised its quarterly dividend to $0.34 per share.
- Common equity Tier 1 ratio fell to 12.9% from 13.5% at year-end 2025, reflecting buybacks and dividends exceeding earnings; the company remains well-capitalized.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-QQ3 FY2026filed October 22, 2026Financial Statements
Q3 FY2026 against Q3 FY2025
| Line item | Q3 FY2026Q3 FY2025 | Change |
|---|---|---|
| Net Income | $892.00M$1.08B | −17.2% |
| EPS (Basic) | $2.71$2.89 | −6.2% |
| EPS (Diluted) | $2.68$2.86 | −6.3% |
| Shares Outstanding (Basic) | 319.00M365.90M | −12.8% |
| Shares Outstanding (Diluted) | 322.40M369.90M | −12.8% |
05—Questions
Frequently Asked Questions
Why did Synchrony's net earnings decline in the third quarter of 2026?
Net earnings fell to $892 million from $1.08 billion, mainly because other expense rose $123 million (driven by operational losses, technology costs and marketing) and the provision for credit losses rose $120 million, reflecting a reserve build versus a prior-year release. Net interest income growth of $89 million only partially offset these pressures.
Is Synchrony's credit quality improving?
On most measures, yes. The Q3 net charge-off rate declined to 4.79% from 5.16%, the over-30 day delinquency rate fell to 4.34% from 4.39%, and the allowance coverage ratio was 10.01%, down from 10.35%. Management expects the full-year 2026 net charge-off rate to be below its 5.5% to 6.0% long-term target range.
What is Synchrony doing with its capital?
Synchrony repurchased $2.9 billion of common stock in the first nine months of 2026 and declared $0.94 per share in common dividends for the period. The Board raised the quarterly dividend to $0.34 per share, and $4.6 billion remained under the $6.5 billion repurchase program announced in April 2026, which has no expiration date. The company also issued $500 million of 7.250% Series C preferred stock in June 2026.
How is Synchrony funding its lending business?
Deposits are the main source, totaling $83.0 billion at September 30, 2026, or 83% of total funding sources. Total deposits rose 2.2% from year-end 2025. The company also uses securitized financings and senior and subordinated unsecured notes, including $1.1 billion of senior notes issued in July 2026, and held $19.5 billion of liquid assets at quarter-end.
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