falsedesktopOPRT2020-09-30000153871620000182{"tbl_sim": "https://q10k.com/tbl-sim", "search": "https://q10k.com/search"}{"q10k_tbl_0": "Large accelerated filer\t☐\tSmaller reporting company\t☒\nAccelerated filer\t☐\tEmerging growth company\t☐\nNon-accelerated filer\t☒\t\t\n", "q10k_tbl_1": "TABLE OF CONTENTS\t\t\nGLOSSARY\t\t\nPART I ‑ FINANCIAL INFORMATION\t\t\nItem 1.\tFinancial Statements (Unaudited)\t5\n\tCondensed Consolidated Balance Sheets\t5\n\tCondensed Consolidated Statements of Operations and Comprehensive Income\t6\n\tCondensed Consolidated Statements of Changes in Stockholders' Equity\t7\n\tCondensed Consolidated Statements of Cash Flow\t9\n\tNotes to the Condensed Consolidated Financial Statements\t10\nItem 2.\tManagement's Discussion and Analysis of Financial Condition and Results of Operations\t23\nItem 3.\tQuantitative and Qualitative Disclosures About Market Risk\t50\nItem 4.\tControls and Procedures\t50\nPART II ‑ OTHER INFORMATION\t\t\nItem 1.\tLegal Proceedings\t51\nItem 1A.\tRisk Factors\t51\nItem 2.\tUnregistered Sales of Equity Securities and Use of Proceeds\t78\nItem 3.\tDefaults Upon Senior Securities\t78\nItem 4.\tMine Safety Disclosures\t79\nItem 5.\tOther Information\t79\nItem 6.\tExhibit Index\t80\nSignature\t\t81\n", "q10k_tbl_2": "Term or Abbreviation\tDefinition\n30+ Day Delinquency Rate (1)\tUnpaid principal balance for our owned loans that are 30 or more calendar days contractually past due as of the end of the period divided by Owned Principal Balance as of such date\nAccess Loan Program\tA program intended to make credit available to select borrowers who do not qualify for credit under Oportun's core loan origination program\nActive Customers (1)\tNumber of customers with an outstanding loan serviced by us at the end of a period. Active Customers includes customers whose loans are owned by us and loans that have been sold that we continue to service. Customers with charged-off accounts are excluded from Active Customers\nAdjusted EBITDA\tAdjusted EBITDA is a non-GAAP financial measure calculated as net income (loss) adjusted for the impact of our election of the fair value option and further adjusted to eliminate the effect of the following items: income tax expense (benefit) COVID-19 expenses stock-based compensation expense depreciation and amortization litigation reserve origination fees for Fair Value Loans net and fair value mark-to-market adjustment\nAdjusted Earnings Per Share (\"EPS\")\tAdjusted EPS is a non-GAAP financial measure calculated by dividing Adjusted Net Income by adjusted weighted-average diluted common shares outstanding. Weighted-average diluted common shares outstanding have been adjusted to reflect the conversion of all preferred shares as of the beginning of each annual period\nAdjusted Net Income\tAdjusted Net Income is a non-GAAP financial measure calculated by adjusting our net income (loss) for the impact of our election of the fair value option and further adjusted to exclude income tax expense (benefit) COVID-19 expenses stock-based compensation expense and litigation reserve net of tax\nAdjusted Operating Efficiency\tAdjusted Operating Efficiency is a non-GAAP financial measure calculated by dividing total operating expenses (excluding COVID-19 expenses stock-based compensation expense and litigation reserve) by Fair Value Pro Forma Total Revenue\nAdjusted Return on Equity (\"ROE\")\tAdjusted Return on Equity is a non-GAAP financial measure calculated by dividing annualized Adjusted Net Income by Average Fair Value Pro Forma total stockholders' equity\nAdjusted Tangible Book Value\tFair Value Pro Forma total stockholders' equity excluding intangible assets and system development costs\nAdjusted Tangible Book Value Per Share\tAdjusted Tangible Book Value divided by common shares outstanding at period end. Common shares outstanding at period end have been adjusted to reflect the conversion of all preferred shares as of the beginning of each annual period.\nAggregate Originations (1)\tAggregate amount disbursed to borrowers during a specific period. Aggregate Originations excludes any fees in connection with the origination of a loan\nAnnualized Net Charge-Off Rate (1)\tAnnualized loan principal losses (net of recoveries) divided by the Average Daily Principal Balance of owned loans for the period\nAOCI\tAccumulated other comprehensive income (loss)\nAPR\tAnnual Percentage Rate\nAverage Daily Debt Balance\tAverage of outstanding debt principal balance at the end of each calendar day during the period\nAsset-Backed Notes at Fair Value (or \"Fair Value Notes\")\tAll asset-backed notes issued by Oportun on or after January 1 2018\nAverage Daily Principal Balance (1)\tAverage of outstanding principal balance of owned loans at the end of each calendar day during the period\nBoard\tOportun's Board of Directors\nBook Value\tTotal assets less total liabilities or equal to total stockholders' equity\nBook Value Per Share\tBook Value divided by common shares outstanding at period end\nCost of Debt\tAnnualized interest expense divided by Average Daily Debt Balance\nCustomer Acquisition Cost (1)\tSales and marketing expenses which include the costs associated with various paid marketing channels including direct mail digital marketing and brand marketing and the costs associated with our telesales and retail operations divided by number of loans originated to new and returning customers during a period\nEmergency Hardship Deferral\tAny receivable that currently has one or more payments deferred and added at the end of the loan payment schedule in connection with a local or wide-spread emergency declared by local state or federal government such as a natural disaster government shutdown or pandemic\nFair Value Loans (or \"Loans Receivable at Fair Value\")\tAll loans receivable held for investment that were originated on or after January 1 2018\nFair Value Pro Forma\tIn order to facilitate comparisons to periods prior to January 1 2018 certain metrics included in this presentation have been shown on a pro forma basis as if we had elected the fair value option since our inception for all loans originated and held for investment and all asset-backed notes issued\nFair Value Pro Forma Total Revenue\tFair Value Pro Forma Total Revenue is calculated as the sum of Fair Value Pro Forma interest income and non-interest income. Fair Value Pro Forma interest income includes interest on loans and fees; origination fees are recognized upon disbursement. Non-interest income includes gain on sales servicing fees and other income. The Company adopted ASU 2019-05 as of January 1 2020 and as a result Fair Value Pro Forma Total Revenue and GAAP Total Revenue are equal for all prospective reporting periods\nFair Value Notes (or \"Asset-Backed Notes at Fair Value\")\tAll asset-backed notes issued by Oportun on or after January 1 2018\nFICO® score or FICO®\tA credit score created by Fair Isaac Corporation\nFirst Payment Defaults\tCalculated as the principal balance of any loan whose first payment becomes 30 days past due divided by the aggregate principal balance of all loans originated during that same period\nGAAP\tGenerally Accepted Accounting Principles\n", "q10k_tbl_3": "Term or Abbreviation\tDefinition\nInitial Fair Value Loans\tAll loans receivable held for investment that were originated on or after January 1 2018\nLeverage\tAverage Daily Debt Balance divided by Average Daily Principal Balance\nLoans Receivable at Amortized Cost\tLoans held for investment that were originated prior to January 1 2018. Upon the adoption of ASU 2019-05 as of January 1 2020 this line item has been eliminated for all prospective reporting periods\nLoans Receivable at Fair Value (or \"Fair Value Loans\")\tAll Initial Fair Value Loans together with the Subsequent Fair Value Loans\nManaged Principal Balance at End of Period (1)\tTotal amount of outstanding principal balance for all loans including loans sold which we continue to service at the end of the period\nNet Revenue\tNet Revenue is calculated by subtracting interest expense and provision (release) for loan losses from total revenue and adding the net increase (decrease) in fair value.\nOperating Efficiency\tTotal operating expenses divided by total revenue\nOwned Principal Balance at End of Period (1)\tTotal amount of outstanding principal balance for all loans excluding loans sold at the end of the period\nPortfolio Yield (1)\tAnnualized interest income as a percentage of Average Daily Principal Balance\nPrincipal Balance\tOriginal principal balance reduced by principal payments received to date\nReturn on Equity\tAnnualized net income divided by average stockholders' equity for a period\nSubsequent Fair Value Loans\tAll loans receivable held for investment previously measured at amortized cost for which the Company elected the fair value option upon adoption of ASU 2019-05 effective January 1 2020\nTDR Finance Receivables\tTroubled debt restructured finance receivables. This is only applicable to Loans Receivable at Amortized Cost. Debt restructuring in which a concession is granted to the borrower as a result of economic or legal reasons related to the borrower's financial difficulties. Upon the adoption of ASU 2019-05 as of January 1 2020 this line item has been eliminated for all prospective reporting periods\nSecured Financing\tAsset-backed revolving debt facility\nVIEs\tVariable interest entities\nWeighted Average Interest Rate\tAnnualized interest expense as a percentage of average debt\n", "q10k_tbl_4": "\tSeptember 30\tDecember 31\n\t2020\t2019\nAssets\t\t\nCash and cash equivalents\t109656\t72179\nRestricted cash\t53824\t63962\nLoans receivable at fair value\t1605388\t1882088\nLoans receivable at amortized cost\t0\t42546\nLess:\t\t\nUnamortized deferred origination costs and fees net\t0\t(103)\nAllowance for loan losses\t0\t(3972)\nLoans receivable at amortized cost net\t0\t38471\nLoans held for sale\t1046\t715\nInterest and fees receivable net\t16535\t17185\nRight of use assets - operating\t48762\t50503\nOther assets\t82312\t76771\nTotal assets\t1917523\t2201874\nLiabilities and stockholders' equity\t\t\nLiabilities\t\t\nSecured financing\t191180\t60910\nAsset-backed notes at fair value\t1125444\t1129202\nAsset-backed notes at amortized cost\t0\t359111\nAmount due to whole loan buyer\t26810\t33354\nLease liabilities\t51692\t53357\nOther liabilities\t69376\t77174\nTotal liabilities\t1464502\t1713108\nStockholders' equity\t\t\nPreferred stock $0.0001 par value - 100000000 shares authorized at September 30 2020 and December 31 2019; 0 shares issued and outstanding at September 30 2020 and December 31 2019\t0\t0\nPreferred stock additional paid-in capital\t0\t0\nCommon stock $0.0001 par value - 1000000000 shares authorized at September 30 2020 and December 31 2019; 27855051 shares issued and 27583028 shares outstanding at September 30 2020; 27262639 shares issued and 27003157 shares outstanding at December 31 2019\t6\t6\nCommon stock additional paid-in capital\t431673\t418299\nCommon stock warrants\t0\t63\nAccumulated other comprehensive loss\t(268)\t(162)\nRetained earnings\t27919\t76679\nTreasury stock at cost 272023 and 259482 shares at September 30 2020 and December 31 2019\t(6309)\t(6119)\nTotal stockholders' equity\t453021\t488766\nTotal liabilities and stockholders' equity\t1917523\t2201874\n", "q10k_tbl_5": "\tThree Months Ended September 30\t\tNine Months Ended September 30\t\n\t2020\t2019\t2020\t2019\nRevenue\t\t\t\t\nInterest income\t128739\t139272\t415525\t395778\nNon-interest income\t8028\t14608\t27377\t39026\nTotal revenue\t136767\t153880\t442902\t434804\nLess:\t\t\t\t\nInterest expense\t13408\t15499\t44879\t44751\nProvision (release) for loan losses\t0\t(426)\t0\t(3755)\nDecrease in fair value\t(29633)\t(24339)\t(177584)\t(78567)\nNet revenue\t93726\t114468\t220439\t315241\nOperating expenses:\t\t\t\t\nTechnology and facilities\t31641\t26772\t93927\t72849\nSales and marketing\t20634\t24717\t65521\t69084\nPersonnel\t26662\t28637\t79925\t66414\nOutsourcing and professional fees\t11491\t16041\t36232\t42797\nGeneral administrative and other\t11138\t3886\t17591\t10816\nTotal operating expenses\t101566\t100053\t293196\t261960\nIncome (loss) before taxes\t(7840)\t14415\t(72757)\t53281\nIncome tax expense (benefit)\t(1794)\t4386\t(19162)\t14846\nNet income (loss)\t(6046)\t10029\t(53595)\t38435\nChange in post-termination benefit obligation\t6\t8\t(106)\t(36)\nTotal comprehensive income (loss)\t(6040)\t10037\t(53701)\t38399\nNet income (loss) attributable to common stockholders\t(6046)\t(27427)\t(53595)\t0\nShare data:\t\t\t\t\nEarnings (loss) per share:\t\t\t\t\nBasic\t(0.22)\t(6.39)\t(1.97)\t0\nDiluted\t(0.22)\t(6.39)\t(1.97)\t0\nWeighted average common shares outstanding:\t\t\t\t\nBasic\t27459192\t4294107\t27237246\t3397503\nDiluted\t27459192\t4294107\t27237246\t3397503\n", "q10k_tbl_6": "For the Nine Months Ended September 30 2020\t\t\t\t\t\t\t\t\t\t\t\t\n\tConvertible Preferred Stock\t\t\tCommon Stock Warrants\t\tCommon Stock\t\t\t\t\t\t\n\tShares\tPar Value\tAdditional Paid-in Capital\tShares\tPar Value\tShares\tPar Value\tAdditional Paid-in Capital\tAccumulated Other Comprehensive Income (Loss)\tRetained Earnings\tTreasury Stock\tTotal Stockholders' Equity\nBalance - January 1 2020\t0\t0\t0\t23512\t63\t27003157\t6\t418299\t(162)\t76679\t(6119)\t488766\nIssuance of common stock upon exercise of stock options\t0\t0\t0\t0\t0\t3161\t0\t20\t0\t0\t0\t20\nStock-based compensation expense\t0\t0\t0\t0\t0\t0\t0\t4151\t0\t0\t0\t4151\nVesting of restricted stock units net\t0\t0\t0\t0\t0\t137479\t0\t(813)\t0\t0\t0\t(813)\nCumulative effect of adoption of ASU 2019-05\t0\t0\t0\t0\t0\t0\t0\t0\t0\t4835\t0\t4835\nChange in post-termination benefit obligation\t0\t0\t0\t0\t0\t0\t0\t0\t(117)\t0\t0\t(117)\nNet loss\t0\t0\t0\t0\t0\t0\t0\t0\t0\t(13301)\t0\t(13301)\nBalance - March 31 2020\t0\t0\t0\t23512\t63\t27143797\t6\t421657\t(279)\t68213\t(6119)\t483541\nIssuance of common stock upon exercise of stock options\t0\t0\t0\t0\t0\t22407\t0\t79\t0\t0\t0\t79\nStock-based compensation expense\t0\t0\t0\t0\t0\t0\t0\t4972\t0\t0\t0\t4972\nIssuance of common stock upon exercise of warrants\t0\t0\t0\t(23512)\t(63)\t10972\t0\t253\t0\t0\t(190)\t0\nVesting of restricted stock units net\t0\t0\t0\t0\t0\t153624\t0\t(17)\t0\t0\t0\t(17)\nChange in post-termination benefit obligation\t0\t0\t0\t0\t0\t0\t0\t0\t5\t0\t0\t5\nNet loss\t0\t0\t0\t0\t0\t0\t0\t0\t0\t(34248)\t0\t(34248)\nBalance - June 30 2020\t0\t0\t0\t0\t0\t27330800\t6\t426944\t(274)\t33965\t(6309)\t454332\nIssuance of common stock upon exercise of stock options\t0\t0\t0\t0\t0\t4018\t0\t24\t0\t0\t0\t24\nStock-based compensation expense\t0\t0\t0\t0\t0\t0\t0\t5194\t0\t0\t0\t5194\nVesting of restricted stock units net\t0\t0\t0\t0\t0\t248210\t0\t(489)\t0\t0\t0\t(489)\nChange in post-termination benefit obligation\t0\t0\t0\t0\t0\t0\t0\t0\t6\t0\t0\t6\nNet loss\t0\t0\t0\t0\t0\t0\t0\t0\t0\t(6046)\t0\t(6046)\nBalance - September 30 2020\t0\t0\t0\t0\t0\t27583028\t6\t431673\t(268)\t27919\t(6309)\t453021\n", "q10k_tbl_7": "For the Nine Months Ended September 30 2019\t\t\t\t\t\t\t\t\t\t\t\t\n\tConvertible Preferred Stock\t\t\tConvertible Preferred and Common Stock Warrants\t\tCommon Stock\t\t\t\t\t\t\n\tShares\tPar Value\tAdditional Paid-in Capital\tShares\tPar Value\tShares\tPar Value\tAdditional Paid-in Capital\tAccumulated Other Comprehensive Income (Loss)\tRetained Earnings\tTreasury Stock\tTotal Stockholders' Equity\nBalance - January 1 2019\t14043977\t16\t257887\t24959\t130\t2935249\t3\t44411\t(132)\t52662\t(8428)\t346549\nIssuance of common stock upon exercise of stock options\t0\t0\t0\t0\t0\t7317\t0\t142\t0\t0\t0\t142\nStock-based compensation expense\t0\t0\t0\t0\t0\t0\t0\t1980\t0\t0\t0\t1980\nCumulative effect of adoption of ASC 842\t0\t0\t0\t0\t0\t0\t0\t0\t0\t(125)\t0\t(125)\nChange in post-termination benefit obligation\t0\t0\t0\t0\t0\t0\t0\t0\t(3)\t0\t0\t(3)\nNet income\t0\t0\t0\t0\t0\t0\t0\t0\t0\t14614\t0\t14614\nBalance - March 31 2019\t14043977\t16\t257887\t24959\t130\t2942566\t3\t46533\t(135)\t67151\t(8428)\t363157\nIssuance of common stock upon exercise of stock options\t0\t0\t0\t0\t0\t2216\t0\t4\t0\t0\t0\t4\nStock-based compensation expense\t0\t0\t0\t0\t0\t0\t0\t2035\t0\t0\t0\t2035\nChange in post-termination benefit obligation\t0\t0\t0\t0\t0\t0\t0\t0\t(41)\t0\t0\t(41)\nNet income\t0\t0\t0\t0\t0\t0\t0\t0\t0\t13792\t0\t13792\nBalance - June 30 2019\t14043977\t16\t257887\t24959\t130\t2944782\t3\t48572\t(176)\t80943\t(8428)\t378947\nIssuance of common stock upon exercise of stock options\t0\t0\t0\t0\t0\t96371\t0\t645\t0\t0\t0\t645\nRepurchase of stock options\t0\t0\t0\t0\t0\t0\t0\t(86)\t0\t0\t0\t(86)\nIssuance of common stock upon initial public offering net of offering costs\t0\t0\t0\t0\t0\t4873356\t0\t60479\t0\t0\t0\t60479\nStock-based compensation expense\t0\t0\t0\t0\t0\t0\t0\t11163\t0\t0\t0\t11163\nConversion of convertible preferred stock to common stock in connection with initial public offering\t(14043977)\t(16)\t(257887)\t0\t0\t19075167\t3\t295356\t0\t(37456)\t0\t0\nIssuance of convertible preferred stock and conversion to common stock upon exercise of warrants net\t0\t0\t0\t(9090)\t(67)\t3969\t0\t67\t0\t0\t0\t0\nVesting of restricted stock units\t0\t0\t0\t0\t0\t11627\t0\t0\t0\t0\t0\t0\nRestricted stock units tax withholding\t0\t0\t0\t0\t0\t(4021)\t0\t0\t0\t0\t(68)\t(68)\nChange in post-termination benefit obligation\t0\t0\t0\t0\t0\t0\t0\t0\t8\t0\t0\t8\nNet income\t0\t0\t0\t0\t0\t0\t0\t0\t0\t10029\t0\t10029\nBalance - September 30 2019\t0\t0\t0\t15869\t63\t27001251\t6\t416196\t(168)\t53516\t(8496)\t461117\n", "q10k_tbl_8": "\tNine Months Ended September 30\t\n\t2020\t2019\nCash flows from operating activities\t\t\nNet income (loss)\t(53595)\t38435\nAdjustments to reconcile net income (loss) to net cash provided by operating activities:\t\t\nDepreciation and amortization\t14878\t9658\nFair value adjustment net\t177584\t78567\nOrigination fees for loans receivable at fair value net\t3520\t(2172)\nGain on loan sales\t(13406)\t(25291)\nStock-based compensation expense\t14317\t15178\nProvision (release) for loan losses\t0\t(3755)\nDeferred tax provision net\t(14913)\t5082\nOther net\t10688\t6557\nOriginations of loans sold and held for sale\t(134552)\t(248441)\nProceeds from sale of loans\t147627\t269546\nChanges in operating assets and liabilities:\t\t\nInterest and fee receivable net\t(3678)\t(3407)\nOther assets\t(8242)\t(23283)\nAmount due to whole loan buyer\t(6544)\t2159\nOther liabilities\t5723\t48408\nNet cash provided by operating activities\t139407\t167241\nCash flows from investing activities\t\t\nOriginations of loans\t(665148)\t(1035536)\nRepayments of loan principal\t804619\t753072\nPurchase of fixed assets net\t(3610)\t(5765)\nCapitalization of system development costs\t(16492)\t(11734)\nNet cash provided by (used in) investing activities\t119369\t(299963)\nCash flows from financing activities\t\t\nBorrowings under secured financing\t414000\t82000\nProceeds from initial public offering net of offering costs\t0\t60479\nBorrowings under asset-backed notes\t0\t249951\nRepayments of secured financing\t(284006)\t(169000)\nRepayments of asset-backed notes\t(360001)\t0\nRepayments of capital lease obligations\t(29)\t(102)\nPayments of deferred financing costs\t(205)\t0\nNet payments related to stock-based activities\t(1196)\t638\nNet cash provided by (used in) financing activities\t(231437)\t223966\nNet increase in cash and cash equivalents and restricted cash\t27339\t91244\nCash and cash equivalents and restricted cash beginning of period\t136141\t129175\nCash and cash equivalents and restricted cash end of period\t163480\t220419\nSupplemental disclosure of cash flow information\t\t\nCash and cash equivalents\t109656\t154512\nRestricted cash\t53824\t65907\nTotal cash and cash equivalents and restricted cash\t163480\t220419\nCash paid for income taxes net of refunds\t2443\t2786\nCash paid for interest and prepayment fees\t44219\t42845\nCash paid for amounts included in the measurement of operating lease liabilities\t11730\t9337\nSupplemental disclosures of non-cash investing and financing activities\t\t\nRight of use assets obtained in exchange for operating lease obligations\t7404\t46156\nAdditional common stock issued to Series G shareholders upon initial public offering\t0\t37456\nNon-cash investments in capitalized assets\t491\t862\n", "q10k_tbl_9": "\tThree Months Ended September 30\t\tNine Months Ended September 30\t\n(in thousands except share and per share data)\t2020\t2019\t2020\t2019\nNet income (loss)\t(6046)\t10029\t(53595)\t38435\nLess: Additional common stock issued to Series G shareholders\t0\t(37456)\t0\t(37456)\nLess: Net income allocated to participating securities (1)\t0\t0\t0\t(979)\nNet (loss) income attributable to common stockholders\t(6046)\t(27427)\t(53595)\t0\nBasic weighted-average common shares outstanding\t27459192\t4294107\t27237246\t3397503\nWeighted average effect of dilutive securities:\t\t\t\t\nStock options\t0\t0\t0\t0\nRestricted stock units\t0\t0\t0\t0\nWarrants\t0\t0\t0\t0\nDiluted weighted-average common shares outstanding\t27459192\t4294107\t27237246\t3397503\nEarnings (loss) per share:\t\t\t\t\nBasic\t(0.22)\t(6.39)\t(1.97)\t0\nDiluted\t(0.22)\t(6.39)\t(1.97)\t0\n", "q10k_tbl_10": "\tThree Months Ended September 30\t\tNine Months Ended September 30\t\n\t2020\t2019\t2020\t2019\nStock options\t4462158\t4571154\t4352649\t4705200\nRestricted stock units\t2331678\t1325166\t2120068\t779776\nWarrants\t0\t24880\t13866\t24933\nConvertible preferred stock\t0\t16266773\t0\t16886597\nTotal anti-dilutive common share equivalents\t6793836\t22187973\t6486583\t22396506\n", "q10k_tbl_11": "\tSeptember 30\tDecember 31\n(in thousands)\t2020\t2019\nConsolidated VIE assets\t\t\nRestricted cash\t25004\t28821\nLoans receivable at fair value\t1488861\t1745465\nLoans receivable at amortized cost\t0\t41747\nInterest and fee receivable\t15352\t15874\nTotal VIE assets\t1529217\t1831907\nConsolidated VIE liabilities\t\t\nSecured financing (1)\t191994\t62000\nAsset-backed notes at fair value\t1125444\t1129202\nAsset-backed notes at amortized cost (1)\t0\t360001\nTotal VIE liabilities\t1317438\t1551203\n", "q10k_tbl_12": "\tSeptember 30\tDecember 31\n(in thousands)\t2020\t2019\nFixed assets\t\t\nComputer and office equipment\t10993\t10432\nFurniture and fixtures\t11030\t10768\nPurchased software\t4945\t4527\nVehicles\t79\t171\nLeasehold improvements\t28987\t27701\nTotal cost\t56034\t53599\nLess: Accumulated depreciation\t(37298)\t(30765)\nTotal fixed assets net\t18736\t22834\nSystem development costs:\t\t\nSystem development costs\t53186\t36795\nLess: Accumulated amortization\t(26071)\t(18456)\nTotal system development costs net\t27115\t18339\nServicer fee and whole loan receivables\t1102\t6621\nPrepaid expenses\t13318\t12217\nDeferred tax assets\t1346\t1563\nTax assets and other\t20695\t15197\nTotal other assets\t82312\t76771\n", "q10k_tbl_13": "\tSeptember 30 2020\t\t\t\nVariable Interest Entity\tCurrent Balance\tCommitment Amount\tMaturity Date\tInterest Rate\n(in thousands)\t\t\t\t\nOportun Funding V LLC\t191180\t400000\tOctober 1 2021\tLIBOR (minimum of 0.00%) + 2.45%\n", "q10k_tbl_14": "\tDecember 31 2019\t\t\t\nVariable Interest Entity\tCurrent Balance\tCommitment Amount\tMaturity Date\tInterest Rate\n(in thousands)\t\t\t\t\nOportun Funding V LLC\t60910\t400000\tOctober 1 2021\tLIBOR (minimum of 0.00%) + 2.45%\n", "q10k_tbl_15": "\tSeptember 30 2020\t\t\t\t\t\nVariable Interest Entity\tInitial note amount issued (1)\tInitial collateral balance (2)\tCurrent balance (1)\tCurrent collateral balance(2)\tWeighted average interest rate(3)\tOriginal revolving period\n(in thousands)\t\t\t\t\t\t\nAsset-backed notes recorded at fair value:\t\t\t\t\t\t\nOportun Funding XIII LLC (Series 2019-A)\t279412\t294118\t252049\t299659\t3.22%\t3 years\nOportun Funding XII LLC (Series 2018-D)\t175002\t184213\t177768\t187641\t4.50%\t3 years\nOportun Funding X LLC (Series 2018-C)\t275000\t289474\t278618\t294913\t4.39%\t3 years\nOportun Funding IX LLC (Series 2018-B)\t225001\t236854\t216490\t241294\t4.09%\t3 years\nOportun Funding VIII LLC (Series 2018-A)\t200004\t222229\t200519\t226632\t3.83%\t3 years\nTotal asset-backed notes recorded at fair value\t1154419\t1226888\t1125444\t1250139\t\t\n", "q10k_tbl_16": "\tDecember 31 2019\t\t\t\t\t\nVariable Interest Entity\tInitial note amount issued (1)\tInitial collateral balance (2)\tCurrent balance (1)\tCurrent collateral balance(2)\tWeighted average interest rate(3)\tOriginal revolving period\n(in thousands)\t\t\t\t\t\t\nAsset-backed notes recorded at fair value:\t\t\t\t\t\t\nOportun Funding XIII LLC (Series 2019-A)\t279412\t294118\t251090\t299813\t3.22%\t3 years\nOportun Funding XII LLC (Series 2018-D)\t175002\t184213\t178980\t187447\t4.50%\t3 years\nOportun Funding X LLC (Series 2018-C)\t275000\t289474\t280852\t294380\t4.39%\t3 years\nOportun Funding IX LLC (Series 2018-B)\t225001\t236854\t216306\t241000\t4.09%\t3 years\nOportun Funding VIII LLC (Series 2018-A)\t200004\t222229\t201974\t225945\t3.83%\t3 years\nTotal asset-backed notes recorded at fair value\t1154419\t1226888\t1129202\t1248585\t\t\nAsset-backed notes recorded at amortized cost:\t\t\t\t\t\t\nOportun Funding VII LLC (Series 2017-B)\t200000\t222231\t199413\t225925\t3.51%\t3 years\nOportun Funding VI LLC (Series 2017-A)\t160001\t188241\t159698\t191223\t3.36%\t3 years\nTotal asset-backed notes recorded at amortized cost\t360001\t410472\t359111\t417148\t\t\n", "q10k_tbl_17": "\tSeptember 30\tDecember 31\n(in thousands)\t2020\t2019\nAccounts payable\t2579\t5919\nAccrued compensation\t25983\t22226\nAccrued expenses\t23139\t12965\nAccrued interest\t3067\t3842\nDeferred tax liabilities\t9738\t24868\nCurrent tax liabilities and other\t4870\t7354\nTotal other liabilities\t69376\t77174\n", "q10k_tbl_18": "\tThree Months Ended September 30\t\tNine Months Ended September 30\t\n(in thousands)\t2020\t2019\t2020\t2019\nTechnology and facilities\t1010\t1310\t2693\t2068\nSales and marketing\t32\t43\t92\t95\nPersonnel\t4152\t9810\t11532\t13015\nTotal stock-based compensation\t5194\t11163\t14317\t15178\n", "q10k_tbl_19": "\tThree Months Ended September 30\t\tNine Months Ended September 30\t\n(in thousands)\t2020\t2019\t2020\t2019\nInterest income\t\t\t\t\nInterest on loans\t127267\t136803\t410124\t389104\nFees on loans\t1472\t2469\t5401\t6674\nTotal interest income\t128739\t139272\t415525\t395778\n", "q10k_tbl_20": "\tThree Months Ended September 30\t\tNine Months Ended September 30\t\n(in thousands)\t2020\t2019\t2020\t2019\nNon-interest income\t\t\t\t\nGain on loan sales\t3882\t9495\t13406\t25291\nServicing fees\t3515\t3932\t12003\t11149\nOther income\t631\t1181\t1968\t2586\nTotal non-interest income\t8028\t14608\t27377\t39026\n", "q10k_tbl_21": "\tSeptember 30 2020\t\tDecember 31 2019\t\n(in thousands)\tUnpaid Principal Balance\tFair Value\tUnpaid Principal Balance\tFair Value\nAssets\t\t\t\t\nLoans receivable\t1575183\t1605388\t1800418\t1882088\nLiabilities\t\t\t\t\nAsset-backed notes\t1113165\t1125444\t1113165\t1129202\n", "q10k_tbl_22": "\tSeptember 30 2020\t\t\tDecember 31 2019\t\t\n\tMinimum\tMaximum\tWeighted Average (2)\tMinimum (3)\tMaximum (3)\tWeighted Average\nRemaining cumulative charge-offs (1)\t6.52%\t64.07%\t10.61%\t0\t0\t9.61%\nRemaining cumulative prepayments (1)\t-%\t34.71%\t28.34%\t0\t0\t34.95%\nAverage life (years)\t0.21\t1.30\t0.78\t0\t0\t0.81\nDiscount rate\t0\t0\t7.84%\t0\t0\t7.77%\n", "q10k_tbl_23": "\tThree Months Ended September 30\t\tNine Months Ended September 30\t\n(in thousands)\t2020\t2019\t2020\t2019\nBalance - beginning of period\t1635684\t1513413\t1882088\t1227469\nAdjustment upon adoption of ASU 2019-05\t0\t0\t43323\t0\nPrincipal disbursements\t283894\t459227\t804767\t1216582\nPrincipal payments from customers\t(305883)\t(266663)\t(927175)\t(696173)\nGross charge-offs\t(48135)\t(31229)\t(145373)\t(82275)\nNet increase (decrease) in fair value\t39828\t7141\t(52242)\t16286\nBalance - end of period\t1605388\t1681889\t1605388\t1681889\n", "q10k_tbl_24": "\t\tSeptember 30 2020\t\t\t\t\t\t\n\t\tCarrying value\t\tEstimated fair value\t\tEstimated fair value\t\t\n(in thousands)\tLevel 1\t\tLevel 2\t\tLevel 3\nAssets\t\t\t\t\t\t\t\t\nCash and cash equivalents\t\t109656\t\t109656\t\t109656\t0\t0\nRestricted cash\t\t53824\t\t53824\t\t53824\t0\t0\nLoans receivable at amortized cost net (Note 5)\t\t0\t\t0\t\t0\t0\t0\nLoans held for sale (Note 6)\t\t1046\t\t1046\t\t0\t0\t1046\nLiabilities\t\t\t\t\t\t\t\t\nAccounts payable\t\t2579\t\t2579\t\t2579\t0\t0\nSecured financing (Note 8)\t\t191994\t\t189716\t\t0\t189716\t0\n", "q10k_tbl_25": "\t\tDecember 31 2019\t\t\t\t\t\t\n\t\tCarrying value\t\tEstimated fair value\t\tEstimated fair value\t\t\n(in thousands)\tLevel 1\t\tLevel 2\t\tLevel 3\nAssets\t\t\t\t\t\t\t\t\nCash and cash equivalents\t\t72179\t\t72179\t\t72179\t0\t0\nRestricted cash\t\t63962\t\t63962\t\t63962\t0\t0\nLoans receivable at amortized cost net (Note 5)\t\t38471\t\t43482\t\t0\t0\t43482\nLoans held for sale (Note 6)\t\t715\t\t772\t\t0\t0\t772\nLiabilities\t\t\t\t\t\t\t\t\nAccounts payable\t\t5919\t\t5919\t\t5919\t0\t0\nSecured financing (Note 8)\t\t62000\t\t62000\t\t0\t62000\t0\nAsset-backed notes at amortized cost (Note 8)\t\t359111\t\t360668\t\t0\t360668\t0\n", "q10k_tbl_26": "(in thousands)\tOperating Leases\nLease expense\t\n2020 (remaining three months)\t4148\n2021\t14767\n2022\t11971\n2023\t10117\n2024\t8615\n2025\t6562\nThereafter\t1443\nTotal lease payments\t57623\nImputed interest\t(5499)\nTotal leases\t52124\nSublease income\t\n2020 (remaining three months)\t(435)\n2021 and thereafter\t0\nTotal lease payments\t(435)\nImputed interest\t3\nTotal sublease income\t(432)\nNet lease liabilities\t51692\nWeighted average remaining lease term\t4.6 years\nWeighted average discount rate\t4.46%\n", "q10k_tbl_27": "(in thousands)\tOperating Leases\nLease expense\t\n2020\t15227\n2021\t12439\n2022\t9663\n2023\t8340\n2024\t7488\nThereafter\t7293\nTotal lease payments\t60450\nImputed interest\t(6240)\nTotal leases\t54210\nSublease income\t\n2020\t(861)\n2021 and thereafter\t0\nTotal lease payments\t(861)\nImputed interest\t8\nTotal sublease income\t(853)\nNet lease liabilities\t53357\nWeighted average remaining lease term\t5.0 years\nWeighted average discount rate\t4.49%\n", "q10k_tbl_28": "Topic\t\nForward-Looking Statements\t23\nOverview\t24\nCOVID-19 Update\t26\nKey Financial and Operating Metrics\t29\nHistorical Credit Performance\t31\nResults of Operations\t33\nFair Value Estimate Methodology for Loans Receivable at Fair Value\t39\nNon-GAAP Financial Measures\t41\nLiquidity and Capital Resources\t47\nOff-Balance Sheet Arrangements\t49\nCritical Accounting Policies and Significant Judgments and Estimates\t49\nRecently Issued Accounting Pronouncements\t49\n", "q10k_tbl_29": "Delinquencies and Deferrals\t\t\t\t\t\t\t\t\n(Percentage of Outstanding Principal Balance of Owned Receivables)\t\t\t\t\t\t\t\t\nDays Delinquent\tAs of 3/31/2020\tAs of 4/30/2020\tAs of 5/31/2020\tAs of 6/30/2020\tAs of 7/31/2020\tAs of 8/31/2020\tAs of 9/30/2020\tAs of 10/31/2020\n0\t88.9%\t90.2%\t87.8%\t89.5%\t90.8%\t90.0%\t90.3%\t91.3%\n1-7\t3.3\t2.6\t3.5\t3.2\t2.6\t3.2\t2.9\t2.4\n8-14\t2.2\t1.6\t1.9\t1.8\t1.5\t1.5\t1.6\t1.2\n15-29\t1.8\t1.6\t2.8\t1.9\t1.8\t1.8\t1.7\t1.5\n30-59\t1.7\t1.8\t1.7\t1.7\t1.6\t1.8\t1.7\t1.7\n60-89\t1.2\t1.3\t1.3\t1.0\t1.0\t1.0\t1.1\t1.1\n90-119\t0.9\t1.0\t1.0\t1.0\t0.8\t0.7\t0.7\t0.8\n120+ (1)\t0\t0\t0\t0\t0\t0\t0\t0\n30+\t3.8\t4.0\t4.0\t3.7\t3.4\t3.5\t3.5\t3.6\nEmergency Hardship Deferrals (2)\t6.1\t14.6\t7.6\t5.0\t3.9\t2.8\t1.5\t1.0\n(1) The 120+ delinquent balances are excluded from the 30+ delinquency rate and percent current rate calculations because these balances are charged off on the last day of a given month.\t\t\t\t\t\t\t\t\n(2) Emergency Hardship Deferrals excluded from delinquent balances.\t\t\t\t\t\t\t\t\n", "q10k_tbl_30": "\tStart of Pandemic\tRecovery\t\t\t\t\t\t\tQuarterly Comparison\t\nP/P (1)\t-23%\t-64%\t12%\t46%\t24%\t19%\t14%\t15%\t-64%\t92%\nY/Y\t-16%\t-71%\t-71%\t-60%\t-54%\t-45%\t-33%\t-31%\t-67%\t-44%\nCAC\t215\t574\t461\t298\t240\t210\t180\tNA\t413\t207\n(1) 'P/P' refers to period-over-period and is month-over-month from March '20 through October '20 and quarter-over-quarter for the quarterly comparisons for 2Q20 and 3Q20.\t\t\t\t\t\t\t\t\t\t\n", "q10k_tbl_31": "\tAs of or for the Three Months Ended September 30\t\tAs of or for the Nine Months Ended September 30\t\n(in thousands of dollars except CAC)\t2020\t2019\t2020\t2019\nAggregate Originations (1)\t302397\t543541\t892798\t1432569\nNumber of Loans Originated (1)\t97826\t192709\t289169\t513124\nActive Customers (1)\t624205\t745089\t624205\t745089\nCustomer Acquisition Cost (1)\t207\t128\t223\t135\nOwned Principal Balance at End of Period (1)\t1571980\t1691773\t1571980\t1691773\nManaged Principal Balance at End of Period (1)\t1835764\t2018638\t1835764\t2018638\nAverage Daily Principal Balance (1)\t1598141\t1647195\t1731748\t1575526\nCharge-offs Net of Recoveries (1)\t41897\t33696\t129049\t94634\n30+ Day Delinquent Principal Balance at End of Period (1)\t54875\t64818\t54875\t64818\n30+ Day Delinquency Rate (1)\t3.5%\t3.8%\t3.5%\t3.8%\nAnnualized Net Charge-Off Rate (1)\t10.4%\t8.1%\t10.0%\t8.0%\nOperating Efficiency\t74.3%\t65.0%\t66.2%\t60.2%\nAdjusted Operating Efficiency\t63.3%\t57.9%\t60.1%\t57.0%\nReturn on Equity\t(5.3)%\t9.6%\t(15.2)%\t12.7%\nAdjusted Return on Equity\t3.7%\t14.6%\t(9.0)%\t11.7%\n", "q10k_tbl_32": "\tYear of Origination\t\t\t\t\t\t\t\t\t\t\t\t\n\t2007\t2008\t2009\t2010\t2011\t2012\t2013\t2014\t2015\t2016\t2017\t2018\t2019\nNet lifetime loan losses as of September 30 2020 as a percentage of original principal balance\t7.7%\t8.9%\t5.5%\t6.4%\t6.2%\t5.6%\t5.6%\t6.1%\t7.1%\t8.0%\t8.3%\t8.9%*\t3.9%*\nOutstanding principal balance as of September 30 2020 as a percentage of original amount disbursed\t-%\t-%\t-%\t-%\t-%\t-%\t-%\t-%\t-%\t0.1%\t1.1%\t17.3%\t62.1%\nDollar weighted average original term for vintage in months\t9.3\t9.9\t10.2\t11.7\t12.3\t14.5\t16.4\t19.1\t22.3\t24.2\t26.3\t29.0\t30.0\n", "q10k_tbl_33": "\tThree Months Ended September 30\t\tNine Months Ended September 30\t\n(in thousands of dollars)\t2020\t2019\t2020\t2019\nRevenue\t\t\t\t\nInterest income\t128739\t139272\t415525\t395778\nNon-interest income\t8028\t14608\t27377\t39026\nTotal revenue\t136767\t153880\t442902\t434804\nLess:\t\t\t\t\nInterest expense\t13408\t15499\t44879\t44751\nProvision (release) for loan losses\t0\t(426)\t0\t(3755)\nTotal decrease in fair value\t(29633)\t(24339)\t(177584)\t(78567)\nNet revenue\t93726\t114468\t220439\t315241\nOperating expenses:\t\t\t\t\nTechnology and facilities\t31641\t26772\t93927\t72849\nSales and marketing\t20634\t24717\t65521\t69084\nPersonnel\t26662\t28637\t79925\t66414\nOutsourcing and professional fees\t11491\t16041\t36232\t42797\nGeneral administrative and other\t11138\t3886\t17591\t10816\nTotal operating expenses\t101566\t100053\t293196\t261960\nIncome before taxes\t(7840)\t14415\t(72757)\t53281\nIncome tax expense (benefit)\t(1794)\t4386\t(19162)\t14846\nNet income (loss)\t(6046)\t10029\t(53595)\t38435\n", "q10k_tbl_34": "\tThree Months Ended September 30\t\tPeriod-to-period Change\t\tNine Months Ended September 30\t\tPeriod-to-period Change\t\n(in thousands of dollars)\t2020\t2019\t$\t%\t2020\t2019\t$\t%\nRevenue\t\t\t\t\t\t\t\t\nInterest income\t128739\t139272\t(10533)\t(7.6)%\t415525\t395778\t19747\t5.0%\nNon-interest income\t8028\t14608\t(6580)\t(45.0)%\t27377\t39026\t(11649)\t(29.8)%\nTotal revenue\t136767\t153880\t(17113)\t(11.0)%\t442902\t434804\t8098\t1.9%\nPercentage of total revenue:\t\t\t\t\t\t\t\t\nInterest income\t94.1%\t90.5%\t\t\t93.8%\t91.0%\t\t\nNon-interest income\t5.9%\t9.5%\t\t\t6.2%\t9.0%\t\t\nTotal revenue\t100.0%\t100.0%\t\t\t100.0%\t100.0%\t\t\n", "q10k_tbl_35": "\tThree Months Ended September 30\t\tPeriod-to-period Change\t\tNine Months Ended September 30\t\tPeriod-to-period Change\t\n(in thousands of dollars)\t2020\t2019\t$\t%\t2020\t2019\t$\t%\nInterest expense\t13408\t15499\t(2091)\t(13.5)%\t44879\t44751\t128\t0.3%\nPercentage of total revenue\t9.8%\t10.1%\t\t\t10.1%\t10.3%\t\t\nCost of Debt\t4.0%\t4.3%\t\t\t4.1%\t4.4%\t\t\nLeverage as a percentage of Average Daily Principal Balance\t82.6%\t87.1%\t\t\t84.1%\t86.1%\t\t\n", "q10k_tbl_36": "\tThree Months Ended September 30\t\tPeriod-to-period Change\t\tNine Months Ended September 30\t\tPeriod-to-period Change\t\n(in thousands of dollars)\t2020\t2019\t$\t%\t2020\t2019\t$\t%\nCharge-offs net of recoveries on loans receivable at amortized cost\t0\t3746\t(3746)\t*\t0\t15649\t(15649)\t*\nExcess provision on loans receivable at amortized cost\t0\t(4172)\t4172\t*\t0\t(19404)\t19404\t*\nProvision (release) for loan losses\t0\t(426)\t426\t*\t0\t(3755)\t3755\t*\nAllowance for loan losses rate on amortized cost portfolio\t-%\t9.09%\t\t\t-%\t9.09%\t\t\nPercentage of total revenue\t-%\t(0.3)%\t\t\t-%\t(0.9)%\t\t\n", "q10k_tbl_37": "\tThree Months Ended September 30\t\tPeriod-to-period Change\t\tNine Months Ended September 30\t\tPeriod-to-period Change\t\n(in thousands of dollars)\t2020\t2019\t$\t%\t2020\t2019\t$\t%\nFair value mark-to-market adjustment:\t\t\t\t\t\t\t\t\nFair value mark-to-market adjustment on Loans Receivable at Fair Value\t39828\t7141\t32687\t*\t(52242)\t16286\t(68528)\t*\nFair value mark-to-market adjustment on asset-backed notes\t(27515)\t(1530)\t(25985)\t*\t3758\t(15868)\t19626\t*\nTotal fair value mark-to-market adjustment\t12313\t5611\t6702\t*\t(48484)\t418\t(48902)\t*\nCharge-offs net of recoveries on loans receivable at fair value (1)\t(41946)\t(29950)\t(11996)\t*\t(129100)\t(78985)\t(50115)\t*\nTotal decrease in fair value\t(29633)\t(24339)\t(5294)\t*\t(177584)\t(78567)\t(99017)\t*\nPercentage of total revenue:\t\t\t\t\t\t\t\t\nFair value mark-to-market adjustment\t9.0%\t3.6%\t\t\t(10.9)%\t0.1%\t\t\nCharge-offs net of recoveries on loans receivable at fair value\t(30.7)%\t(19.5)%\t\t\t(29.1)%\t(18.2)%\t\t\nTotal net increase (decrease) in fair value\t(21.7)%\t(15.8)%\t\t\t(40.1)%\t(18.1)%\t\t\nDiscount rate\t7.84%\t7.93%\t\t\t7.84%\t7.93%\t\t\nRemaining cumulative charge-offs\t10.61%\t9.87%\t\t\t10.61%\t9.87%\t\t\nAverage life in years\t0.78\t0.78\t\t\t0.78\t0.78\t\t\n", "q10k_tbl_38": "\tThree Months Ended September 30\t\tPeriod-to-period Change\t\tNine Months Ended September 30\t\tPeriod-to-period Change\t\n(in thousands of dollars)\t2020\t2019\t$\t%\t2020\t2019\t$\t%\nCharge-offs net of recoveries on loans receivable at amortized cost\t0\t3746\t(3746)\t*\t0\t15649\t(15649)\t*\nCharge-offs net of recoveries on loans receivable at fair value (1)\t41946\t29950\t11996\t40.1%\t129100\t78985\t50115\t63.4%\nTotal charge-offs net of recoveries\t41946\t33696\t8250\t24.5%\t129100\t94634\t34466\t36.4%\nAverage Daily Principal Balance\t1598141\t1647195\t(49054)\t(3.0)%\t1731748\t1575526\t156222\t9.9%\nAnnualized Net Charge-Off Rate\t10.4%\t8.1%\t\t\t10.0%\t8.0%\t\t\n", "q10k_tbl_39": "\tThree Months Ended September 30\t\tPeriod-to-period Change\t\tNine Months Ended September 30\t\tPeriod-to-period Change\t\n(in thousands of dollars)\t2020\t2019\t$\t%\t2020\t2019\t$\t%\nTechnology and facilities\t31641\t26772\t4869\t18.2%\t93927\t72849\t21078\t28.9%\nPercentage of total revenue\t23.1%\t17.4%\t\t\t21.2%\t16.8%\t\t\n", "q10k_tbl_40": "\tThree Months Ended September 30\t\tPeriod-to-period Change\t\tNine Months Ended September 30\t\tPeriod-to-period Change\t\n(in thousands of dollars)\t2020\t2019\t$\t%\t2020\t2019\t$\t%\nSales and marketing\t20634\t24717\t(4083)\t(16.5)%\t65521\t69084\t(3563)\t(5.2)%\nPercentage of total revenue\t15.1%\t16.1%\t\t\t14.8%\t15.9%\t\t\nCustomer Acquisition Cost (CAC)\t207\t128\t79\t61.7%\t223\t135\t88\t65.2%\n", "q10k_tbl_41": "\tThree Months Ended September 30\t\tPeriod-to-period Change\t\tNine Months Ended September 30\t\tPeriod-to-period Change\t\n(in thousands of dollars)\t2020\t2019\t$\t%\t2020\t2019\t$\t%\nPersonnel\t26662\t28637\t(1975)\t(6.9)%\t79925\t66414\t13511\t20.3%\nPercentage of total revenue\t19.5%\t18.6%\t\t\t18.0%\t15.3%\t\t\n", "q10k_tbl_42": "\tThree Months Ended September 30\t\tPeriod-to-period Change\t\tNine Months Ended September 30\t\tPeriod-to-period Change\t\n(in thousands of dollars)\t2020\t2019\t$\t%\t2020\t2019\t$\t%\nOutsourcing and professional fees\t11491\t16041\t(4550)\t(28.4)%\t36232\t42797\t(6565)\t(15.3)%\nPercentage of total revenue\t8.4%\t10.4%\t\t\t8.2%\t9.8%\t\t\n", "q10k_tbl_43": "\tThree Months Ended September 30\t\tPeriod-to-period Change\t\tNine Months Ended September 30\t\tPeriod-to-period Change\t\n(in thousands of dollars)\t2020\t2019\t$\t%\t2020\t2019\t$\t%\nGeneral administrative and other\t11138\t3886\t7252\t186.6%\t17591\t10816\t6775\t62.6%\nPercentage of total revenue\t8.1%\t2.5%\t\t\t4.0%\t2.5%\t\t\n", "q10k_tbl_44": "\tThree Months Ended September 30\t\tPeriod-to-period Change\t\tNine Months Ended September 30\t\tPeriod-to-period Change\t\n(in thousands of dollars)\t2020\t2019\t$\t%\t2020\t2019\t$\t%\nIncome tax expense (benefit)\t(1794)\t4386\t(6180)\t(140.9)%\t(19162)\t14846\t(34008)\t(229.1)%\nPercentage of total revenue\t(1.3)%\t2.9%\t\t\t(4.3)%\t3.4%\t\t\nEffective tax rate\t22.9%\t30.4%\t\t\t26.3%\t27.9%\t\t\n", "q10k_tbl_45": "\tThree Months Ended\t\t\t\t\t\t\n\tSep 30 2020\tJun 30 2020\tMar 31 2020\tDec 31 2019\tSep 30 2019\tJun 30 2019\tMar 31 2019\t\t\t\t\t\t\nWeighted average portfolio yield over the remaining life of the loans\t30.50%\t30.78%\t30.74%\t31.45%\t32.08%\t32.43%\t32.59%\t\t\t\t\t\t\nLess: Servicing fee\t(5.00)%\t(5.00)%\t(5.00)%\t(5.00)%\t(5.00)%\t(5.00)%\t(5.00)%\t\t\t\t\t\t\nNet portfolio yield\t25.50%\t25.78%\t25.74%\t26.45%\t27.08%\t27.43%\t27.59%\t\t\t\t\t\t\nMultiplied by: Weighted average life in years\t0.775\t0.797\t0.903\t0.814\t0.781\t0.792\t0.804\t\t\t\t\t\t\nPre-loss cash flow\t19.75%\t20.54%\t23.25%\t21.53%\t21.13%\t21.67%\t22.07%\t\t\t\t\t\t\nLess: Remaining cumulative charge-offs\t(10.61)%\t(12.73)%\t(14.56)%\t(9.61)%\t(9.87)%\t(10.05)%\t(10.00)%\t\t\t\t\t\t\nNet cash flow\t9.14%\t7.81%\t8.69%\t11.92%\t11.26%\t11.62%\t12.07%\t\t\t\t\t\t\nLess: Discount rate multiplied by average life\t(6.07)%\t(7.04)%\t(11.54)%\t(6.33)%\t(6.19)%\t(6.62)%\t(7.09)%\t\t\t\t\t\t\nGross fair value premium (discount) as a percentage of loan principal balance\t3.07%\t0.77%\t(2.85)%\t5.59%\t5.07%\t5.00%\t4.98%\t\t\t\t\t\t\nLess: Accrued interest and fees as a percentage of loan principal balance\t(1.15)%\t(1.35)%\t(1.11)%\t(1.05)%\t(0.97)%\t(0.93)%\t(0.97)%\t\t\t\t\t\t\nFair value premium (discount) as a percentage of loan principal balance\t1.92%\t(0.58)%\t(3.96)%\t4.54%\t4.10%\t4.07%\t4.01%\t\t\t\t\t\t\nDiscount Rate\t7.84%\t8.84%\t12.78%\t7.77%\t7.93%\t8.38%\t8.86%\t\t\t\t\t\t\n", "q10k_tbl_46": "\tThree Months Ended\t\t\t\t\t\t\n\tSep 30 2020\tJun 30 2020\tMar 31 2020\tDec 31 2019\tSep 30 2019\tJun 30 2019\tMar 31 2019\t\t\t\t\t\t\nWeighted average portfolio yield over the remaining life of the loans\t30.50%\t30.78%\t30.74%\t31.47%\t31.89%\t32.37%\t32.45%\t\t\t\t\t\t\nLess: Servicing fee\t(5.00)%\t(5.00)%\t(5.00)%\t(5.00)%\t(5.00)%\t(5.00)%\t(5.00)%\t\t\t\t\t\t\nNet portfolio yield\t25.50%\t25.78%\t25.74%\t26.47%\t26.89%\t27.37%\t27.45%\t\t\t\t\t\t\nMultiplied by: Weighted average life in years\t0.775\t0.797\t0.903\t0.804\t0.765\t0.764\t0.754\t\t\t\t\t\t\nPre-loss cash flow\t19.75%\t20.54%\t23.25%\t21.28%\t20.71%\t20.80%\t20.59%\t\t\t\t\t\t\nLess: Remaining cumulative charge-offs\t(10.61)%\t(12.73)%\t(14.56)%\t(9.51)%\t(9.83)%\t(9.94)%\t(9.83)%\t\t\t\t\t\t\nNet cash flow\t9.14%\t7.81%\t8.69%\t11.77%\t10.88%\t10.86%\t10.76%\t\t\t\t\t\t\nLess: Discount rate multiplied by average life\t(6.07)%\t(7.04)%\t(11.54)%\t(6.25)%\t(6.11)%\t(6.37)%\t(6.65)%\t\t\t\t\t\t\nGross fair value premium (discount) as a percentage of loan principal balance\t3.07%\t0.77%\t(2.85)%\t5.52%\t4.77%\t4.49%\t4.11%\t\t\t\t\t\t\nLess: Accrued interest and fees as a percentage of loan principal balance\t(1.15)%\t(1.35)%\t(1.11)%\t(1.04)%\t(0.96)%\t(0.92)%\t(0.96)%\t\t\t\t\t\t\nFair value premium (discount) as a percentage of loan principal balance\t1.92%\t(0.58)%\t(3.96)%\t4.48%\t3.81%\t3.57%\t3.15%\t\t\t\t\t\t\nDiscount Rate\t7.84%\t8.84%\t12.78%\t7.77%\t7.93%\t8.38%\t8.86%\t\t\t\t\t\t\n", "q10k_tbl_47": "\tThree Months Ended September 30 2020\t\t\tThree Months Ended September 30 2019\t\t\tPeriod-to-period Change in FVPF\t\n(in thousands)\tAs Reported\tFV Adjustments\tFV Pro Forma\tAs Reported\tFV Adjustments\tFV Pro Forma\t$\t%\nRevenue:\t\t\t\t\t\t\t\t\nInterest income\t128739\t0\t128739\t139272\t(270)\t139002\t(10263)\t(7.4)%\nNon-interest income\t8028\t0\t8028\t14608\t0\t14608\t(6580)\t(45.0)%\nTotal revenue\t136767\t0\t136767\t153880\t(270)\t153610\t(16843)\t(11.0)%\nLess:\t\t\t\t\t\t\t\t\nInterest expense\t13408\t(207)\t13201\t15499\t(355)\t15144\t(1943)\t(12.8)%\nProvision (release) for loan losses\t0\t0\t0\t(426)\t426\t0\t0\t-%\nNet decrease in fair value\t(29633)\t(1579)\t(31212)\t(24339)\t(3219)\t(27558)\t(3654)\t13.3%\nNet revenue\t93726\t(1372)\t92354\t114468\t(3560)\t110908\t(18554)\t(16.7)%\nOperating expenses:\t\t\t\t\t\t\t\t\nTechnology and facilities\t31641\t0\t31641\t26772\t0\t26772\t4869\t18.2%\nSales and marketing\t20634\t0\t20634\t24717\t0\t24717\t(4083)\t(16.5)%\nPersonnel\t26662\t0\t26662\t28637\t0\t28637\t(1975)\t(6.9)%\nOutsourcing and professional fees\t11491\t0\t11491\t16041\t0\t16041\t(4550)\t(28.4)%\nGeneral administrative and other\t11138\t0\t11138\t3886\t0\t3886\t7252\t186.6%\nTotal operating expenses\t101566\t0\t101566\t100053\t0\t100053\t1513\t1.5%\nIncome (loss) before taxes\t(7840)\t(1372)\t(9212)\t14415\t(3560)\t10855\t(20067)\t(184.9)%\nIncome tax expense (benefit)\t(1794)\t(375)\t(2169)\t4386\t(1083)\t3303\t(5472)\t(165.7)%\nNet income (loss)\t(6046)\t(997)\t(7043)\t10029\t(2477)\t7552\t(14595)\t(193.3)%\n", "q10k_tbl_48": "\tNine Months Ended September 30 2020\t\t\tNine Months Ended September 30 2019\t\t\tPeriod-to-period Change in FVPF\t\n(in thousands)\tAs Reported\tFV Adjustments\tFV Pro Forma\tAs Reported\tFV Adjustments\tFV Pro Forma\t$\t%\nRevenue:\t\t\t\t\t\t\t\t\nInterest income\t415525\t0\t415525\t395778\t(1595)\t394183\t21342\t5.4%\nNon-interest income\t27377\t0\t27377\t39026\t0\t39026\t(11649)\t(29.8)%\nTotal revenue\t442902\t0\t442902\t434804\t(1595)\t433209\t9693\t2.2%\nLess:\t\t\t\t\t\t\t\t\nInterest expense\t44879\t(889)\t43990\t44751\t(1054)\t43697\t293\t0.7%\nProvision (release) for loan losses\t0\t0\t0\t(3755)\t3755\t0\t0\t-%\nNet decrease in fair value\t(177584)\t667\t(176917)\t(78567)\t(14053)\t(92620)\t(84297)\t91.0%\nNet revenue\t220439\t1556\t221995\t315241\t(18349)\t296892\t(74897)\t(25.2)%\nOperating expenses:\t\t\t\t\t\t\t\t\nTechnology and facilities\t93927\t0\t93927\t72849\t0\t72849\t21078\t28.9%\nSales and marketing\t65521\t0\t65521\t69084\t0\t69084\t(3563)\t(5.2)%\nPersonnel\t79925\t0\t79925\t66414\t0\t66414\t13511\t20.3%\nOutsourcing and professional fees\t36232\t0\t36232\t42797\t0\t42797\t(6565)\t(15.3)%\nGeneral administrative and other\t17591\t0\t17591\t10816\t0\t10816\t6775\t62.6%\nTotal operating expenses\t293196\t0\t293196\t261960\t0\t261960\t31236\t11.9%\nIncome (loss) before taxes\t(72757)\t1556\t(71201)\t53281\t(18349)\t34932\t(106133)\t(303.8)%\nIncome tax expense (benefit)\t(19162)\t682\t(18480)\t14846\t(5060)\t9786\t(28266)\t(288.8)%\nNet income (loss)\t(53595)\t874\t(52721)\t38435\t(13289)\t25146\t(77867)\t(309.7)%\n", "q10k_tbl_49": "\tSeptember 30 2020\t\t\tDecember 31 2019\t\t\tPeriod-to-period Change in FV PF\t\n(in thousands)\tAs Reported\tFV Adjustments\tFV Pro Forma\tAs Reported\tFV Adjustments\tFV Pro Forma\t$\t%\nCash and cash equivalents\t109656\t0\t109656\t72179\t0\t72179\t37477\t51.9%\nRestricted cash\t53824\t0\t53824\t63962\t0\t63962\t(10138)\t(15.9)%\nLoans receivable (1)\t1605388\t0\t1605388\t1920559\t5011\t1925570\t(320182)\t(16.6)%\nOther assets\t148655\t0\t148655\t145174\t(6579)\t138595\t10060\t7.3%\nTotal assets\t1917523\t0\t1917523\t2201874\t(1568)\t2200306\t(282783)\t(12.9)%\nTotal debt (2)\t1316624\t0\t1316624\t1549223\t1557\t1550780\t(234156)\t(15.1)%\nOther liabilities\t147878\t682\t148560\t163885\t(1621)\t162264\t(13704)\t(8.4)%\nTotal liabilities\t1464502\t682\t1465184\t1713108\t(64)\t1713044\t(247860)\t(14.5)%\nTotal stockholder's equity\t453021\t(682)\t452339\t488766\t(1504)\t487262\t(34923)\t(7.2)%\nTotal liabilities and stockholders' equity\t1917523\t0\t1917523\t2201874\t(1568)\t2200306\t(282783)\t(12.9)%\n", "q10k_tbl_50": "Components of Fair Value Mark-to-Market Adjustment - Fair Value Pro Forma (in thousands)\t\tThree Months Ended September 30\t\t\t\tNine Months Ended September 30\t\t\n\t2020\t\t2019\t\t2020\t\t2019\nFair value mark-to-market adjustment on Fair Value Loans\t\t39828\t\t7927\t\t(52242)\t\t21339\nFair value mark-to-market adjustment on asset-backed notes\t\t(29094)\t\t(1789)\t\t4425\t\t(19324)\nTotal fair value mark-to-market adjustment - Fair Value Pro Forma\t\t10734\t\t6138\t\t(47817)\t\t2015\n", "q10k_tbl_51": "\tThree Months Ended September 30\t\tNine Months Ended September 30\t\nAdjusted EBITDA (in thousands)\t2020\t2019\t2020\t2019\nNet income\t(6046)\t10029\t(53595)\t38435\nAdjustments:\t\t\t\t\nFair Value Pro Forma net income adjustment\t(997)\t(2477)\t874\t(13289)\nIncome tax expense (benefit)\t(2169)\t3303\t(18480)\t9786\nCOVID-19 expenses\t1011\t0\t4052\t0\nDepreciation and amortization\t5117\t3591\t14878\t9658\nStock-based compensation expense\t5194\t11163\t14317\t15178\nLitigation reserve\t8750\t0\t8750\t0\nOrigination fees for Fair Value Loans net\t(1296)\t(909)\t3520\t(440)\nFair value mark-to-market adjustment\t(10734)\t(6138)\t47817\t(2015)\nAdjusted EBITDA (1)\t(1170)\t18562\t22133\t57313\n", "q10k_tbl_52": "\tThree Months Ended September 30\t\tNine Months Ended September 30\t\nAdjusted Net Income (Loss) (in thousands)\t2020\t2019\t2020\t2019\nNet income (loss)\t(6046)\t10029\t(53595)\t38435\nAdjustments:\t\t\t\t\nFair Value Pro Forma net income adjustment\t(997)\t(2477)\t874\t(13289)\nIncome tax expense (benefit)\t(2169)\t3303\t(18480)\t9786\nCOVID-19 expenses\t1011\t0\t4052\t0\nStock-based compensation expense\t5194\t11163\t14317\t15178\nLitigation reserve\t8750\t0\t8750\t0\nAdjusted income (loss) before taxes\t5743\t22018\t(44082)\t50110\nNormalized income tax expense (benefit)\t1570\t6698\t(12347)\t14260\nAdjusted Net Income (Loss) (1)\t4173\t15320\t(31735)\t35850\nIncome tax rate (2)\t27.4%\t30.4%\t28.0%\t27.9%\n", "q10k_tbl_53": "\tThree Months Ended September 30\t\tNine Months Ended September 30\t\n(in thousands except share and per share data)\t2020\t2019\t2020\t2019\nDiluted earnings (loss) per share\t(0.22)\t(6.39)\t(1.97)\t0\nAdjusted EPS\t\t\t\t\nAdjusted Net Income (Loss)\t4173\t15320\t(31735)\t35850\nBasic weighted-average common shares outstanding\t27459192\t4294107\t27237246\t3397503\nWeighted-average common shares outstanding based on assumed convertible preferred conversion\t0\t18038315\t0\t18725641\nWeighted average effect of dilutive securities:\t\t\t\t\nStock options\t1188396\t1386546\t0\t1306785\nRestricted stock units\t75282\t114337\t0\t38935\nWarrants\t0\t12714\t0\t12030\nDiluted adjusted weighted-average common shares outstanding\t28722870\t23846019\t27237246\t23480894\nAdjusted Earnings (Loss) Per Share\t0.15\t0.64\t(1.17)\t1.53\n", "q10k_tbl_54": "\tSeptember 30\tDecember 31\nAdjusted TBVPS (in thousands except share and per share data)\t2020\t2019\nStockholders' equity\t453021\t488766\nAdjustments:\t\t\nFair Value Pro Forma stockholders' equity adjustment\t(682)\t(1504)\nIntangible assets net (1)\t(27229)\t(18455)\nAdjusted Tangible Book Value\t425110\t468807\nTotal common shares outstanding\t27583028\t27003157\nBook Value Per Share\t16.42\t18.10\nAdjusted Tangible Book Value Per Share\t15.41\t17.36\n", "q10k_tbl_55": "\tAs of or for the Three Months Ended September 30\t\tAs of or for the Nine Months Ended September 30\t\n(in thousands)\t2020\t2019\t2020\t2019\nReturn on Equity\t(5.3)%\t9.6%\t(15.2)%\t12.7%\nAdjusted Return on Equity\t\t\t\t\nAdjusted Net Income (Loss)\t4173\t15320\t(31735)\t35850\nFair Value Pro Forma average stockholders' equity\t453493\t419588\t469801\t408819\nAdjusted Return on Equity\t3.7%\t14.6%\t(9.0)%\t11.7%\n", "q10k_tbl_56": "\tAs of or for the Three Months Ended September 30\t\tAs of or for the Nine Months Ended September 30\t\n(in thousands)\t2020\t2019\t2020\t2019\nOperating Efficiency\t74.3%\t65.0%\t66.2%\t60.2%\nAdjusted Operating Efficiency\t\t\t\t\nTotal revenue\t136767\t153880\t442902\t434804\nFair Value Pro Forma Total Revenue adjustments\t0\t(270)\t0\t(1595)\nFair Value Pro Forma Total Revenue\t136767\t153610\t442902\t433209\nTotal operating expense\t101566\t100053\t293196\t261960\nCOVID-19 expenses\t(1011)\t0\t(4052)\t0\nStock-based compensation expense\t(5194)\t(11163)\t(14317)\t(15178)\nLitigation reserve\t(8750)\t0\t(8750)\t0\nTotal Fair Value Pro Forma adjusted operating expenses\t86611\t88890\t266077\t246782\nAdjusted Operating Efficiency\t63.3%\t57.9%\t60.1%\t57.0%\n", "q10k_tbl_57": "Debt Facility\tScheduled Amortization Period Commencement Date\tInterest Rate\tPrincipal (in thousands)\nSecured Financing\t10/1/2021\tLIBOR (minimum of 0.00%) + 2.45%\t191994\nAsset-Backed Securitization-Series 2019-A Notes\t8/1/2022\t3.22%\t250000\nAsset-Backed Securitization-Series 2018-D Notes\t12/1/2021\t4.50%\t175002\nAsset-Backed Securitization-Series 2018-C Notes\t10/1/2021\t4.39%\t275000\nAsset-Backed Securitization-Series 2018-B Notes\t7/1/2021\t4.09%\t213159\nAsset-Backed Securitization-Series 2018-A Notes\t3/1/2021\t3.83%\t200004\n\t\t\t1305159\n", "q10k_tbl_58": "\tNine Months Ended September 30\t\n(in thousands)\t2020\t2019\nCash cash equivalents and restricted cash\t163480\t220419\nCash provided by (used in)\t\t\nOperating activities\t139407\t167241\nInvesting activities\t119369\t(299963)\nFinancing activities\t(231437)\t223966\n", "q10k_tbl_59": "\t\tIncorporated by Reference\t\t\t\t\nExhibit\tDescription\tForm\tFile No.\tExhibit\tFiling Date\tFiled Herewith\n10.1¥\tProgram Agreement by and between Oportun Inc. and MetaBank N.A. dated as of August 11 2020.\t\t\t\t\tx\n31.1\tRule 13a-14(a)/15d-14(a) Certifications of the Chief Executive Officer and Director of Oportun Financial Corporation\t\t\t\t\tx\n31.2\tRule 13a-14(a)/15d-14(a) Certifications of the Chief Financial Officer and Chief Administrative Officer of Oportun Financial Corporation\t\t\t\t\tx\n32.1*\tSection 1350 Certifications\t\t\t\t\tx\n101\tInteractive data files pursuant to Rule 405 of Regulation S-T:\t\t\t\t\t\n\t(i) Condensed Consolidated Balance Sheets\t\t\t\t\t\n\t(ii) Condensed Consolidated Statements of Operations and Comprehensive Income\t\t\t\t\t\n\t(iii) Condensed Consolidated Statements of Changes in Stockholders' Equity\t\t\t\t\t\n\t(iv) Condensed Consolidated Statements of Cash Flows and\t\t\t\t\t\n\t(v) Notes to the Condensed Consolidated Financial Statements\t\t\t\t\t\n104\tCover Page Interactive Data File in Inline XBRL format (Included in Exhibit 101).\t\t\t\t\t\n"}{"bs": "q10k_tbl_4", "is": "q10k_tbl_2", "cf": "q10k_tbl_8"}None
☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2020
or
☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ___________ to ___________
Commission File Number 001-39050
OPORTUN FINANCIAL CORPORATION
(Exact Name of Registrant as Specified in its Charter)
Delaware
45-3361983
State or Other Jurisdiction of Incorporation or Organization
I.R.S. Employer Identification No.
2 Circle Star Way
San Carlos,
CA
94070
Address of Principal Executive Offices
Zip Code
(650) 810-8823
Registrant’s Telephone Number, Including Area Code
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Common Stock, $0.0001 par value per share
OPRT
Nasdaq Global Select Market
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes☒No☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer
☐
Smaller reporting company
☒
Accelerated filer
☐
Emerging growth company
☐
Non-accelerated filer
☒
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐No☒
The number of shares of registrant’s common stock outstanding as of November 5, 2020 was 27,607,142.
Terms and abbreviations used in this report are defined below.
Term or Abbreviation
Definition
30+ Day Delinquency Rate (1)
Unpaid principal balance for our owned loans that are 30 or more calendar days contractually past due as of the end of the period divided by Owned Principal Balance as of such date
Access Loan Program
A program intended to make credit available to select borrowers who do not qualify for credit under Oportun's core loan origination program
Active Customers (1)
Number of customers with an outstanding loan serviced by us at the end of a period. Active Customers includes customers whose loans are owned by us and loans that have been sold that we continue to service. Customers with charged-off accounts are excluded from Active Customers
Adjusted EBITDA
Adjusted EBITDA is a non-GAAP financial measure calculated as net income (loss), adjusted for the impact of our election of the fair value option and further adjusted to eliminate the effect of the following items: income tax expense (benefit), COVID-19 expenses, stock-based compensation expense, depreciation and amortization, litigation reserve, origination fees for Fair Value Loans, net and fair value mark-to-market adjustment
Adjusted Earnings Per Share ("EPS")
Adjusted EPS is a non-GAAP financial measure calculated by dividing Adjusted Net Income by adjusted weighted-average diluted common shares outstanding. Weighted-average diluted common shares outstanding have been adjusted to reflect the conversion of all preferred shares as of the beginning of each annual period
Adjusted Net Income
Adjusted Net Income is a non-GAAP financial measure calculated by adjusting our net income (loss), for the impact of our election of the fair value option, and further adjusted to exclude income tax expense (benefit), COVID-19 expenses, stock-based compensation expense and litigation reserve, net of tax
Adjusted Operating Efficiency
Adjusted Operating Efficiency is a non-GAAP financial measure calculated by dividing total operating expenses (excluding COVID-19 expenses, stock-based compensation expense and litigation reserve) by Fair Value Pro Forma Total Revenue
Adjusted Return on Equity ("ROE")
Adjusted Return on Equity is a non-GAAP financial measure calculated by dividing annualized Adjusted Net Income by Average Fair Value Pro Forma total stockholders’ equity
Adjusted Tangible Book Value
Fair Value Pro Forma total stockholders' equity, excluding intangible assets and system development costs
Adjusted Tangible Book Value Per Share
Adjusted Tangible Book Value divided by common shares outstanding at period end. Common shares outstanding at period end have been adjusted to reflect the conversion of all preferred shares as of the beginning of each annual period.
Aggregate Originations (1)
Aggregate amount disbursed to borrowers during a specific period. Aggregate Originations excludes any fees in connection with the origination of a loan
Annualized Net Charge-Off Rate (1)
Annualized loan principal losses (net of recoveries) divided by the Average Daily Principal Balance of owned loans for the period
AOCI
Accumulated other comprehensive income (loss)
APR
Annual Percentage Rate
Average Daily Debt Balance
Average of outstanding debt principal balance at the end of each calendar day during the period
Asset-Backed Notes at Fair Value (or "Fair Value Notes")
All asset-backed notes issued by Oportun on or after January 1, 2018
Average Daily Principal Balance (1)
Average of outstanding principal balance of owned loans at the end of each calendar day during the period
Board
Oportun’s Board of Directors
Book Value
Total assets less total liabilities, or equal to total stockholders' equity
Book Value Per Share
Book Value divided by common shares outstanding at period end
Cost of Debt
Annualized interest expense divided by Average Daily Debt Balance
Customer Acquisition Cost (1)
Sales and marketing expenses, which include the costs associated with various paid marketing channels, including direct mail, digital marketing and brand marketing and the costs associated with our telesales and retail operations divided by number of loans originated to new and returning customers during a period
Emergency Hardship Deferral
Any receivable that currently has one or more payments deferred and added at the end of the loan payment schedule in connection with a local or wide-spread emergency declared by local, state or federal government such as a natural disaster, government shutdown or pandemic
Fair Value Loans (or "Loans Receivable at Fair Value")
All loans receivable held for investment that were originated on or after January 1, 2018
Fair Value Pro Forma
In order to facilitate comparisons to periods prior to January 1, 2018, certain metrics included in this presentation have been shown on a pro forma basis as if we had elected the fair value option since our inception for all loans originated and held for investment and all asset-backed notes issued
Fair Value Pro Forma Total Revenue
Fair Value Pro Forma Total Revenue is calculated as the sum of Fair Value Pro Forma interest income and non-interest income. Fair Value Pro Forma interest income includes interest on loans and fees; origination fees are recognized upon disbursement. Non-interest income includes gain on sales, servicing fees and other income. The Company adopted ASU 2019-05 as of January 1, 2020 and as a result Fair Value Pro Forma Total Revenue and GAAP Total Revenue are equal for all prospective reporting periods
Fair Value Notes (or "Asset-Backed Notes at Fair Value")
All asset-backed notes issued by Oportun on or after January 1, 2018
FICO® score or FICO®
A credit score created by Fair Isaac Corporation
First Payment Defaults
Calculated as the principal balance of any loan whose first payment becomes 30 days past due, divided by the aggregate principal balance of all loans originated during that same period
GAAP
Generally Accepted Accounting Principles
3
Term or Abbreviation
Definition
Initial Fair Value Loans
All loans receivable held for investment that were originated on or after January 1, 2018
Leverage
Average Daily Debt Balance divided by Average Daily Principal Balance
Loans Receivable at Amortized Cost
Loans held for investment that were originated prior to January 1, 2018. Upon the adoption of ASU 2019-05 as of January 1, 2020 this line item has been eliminated for all prospective reporting periods
Loans Receivable at Fair Value (or "Fair Value Loans")
All Initial Fair Value Loans, together with the Subsequent Fair Value Loans
Managed Principal Balance at End of Period (1)
Total amount of outstanding principal balance for all loans, including loans sold, which we continue to service, at the end of the period
Net Revenue
Net Revenue is calculated by subtracting interest expense and provision (release) for loan losses from total revenue and adding the net increase (decrease) in fair value.
Operating Efficiency
Total operating expenses divided by total revenue
Owned Principal Balance at End of Period (1)
Total amount of outstanding principal balance for all loans, excluding loans sold, at the end of the period
Portfolio Yield (1)
Annualized interest income as a percentage of Average Daily Principal Balance
Principal Balance
Original principal balance reduced by principal payments received to date
Return on Equity
Annualized net income divided by average stockholders' equity for a period
Subsequent Fair Value Loans
All loans receivable held for investment, previously measured at amortized cost for which the Company elected the fair value option upon adoption of ASU 2019-05, effective January 1, 2020
TDR Finance Receivables
Troubled debt restructured finance receivables. This is only applicable to Loans Receivable at Amortized Cost. Debt restructuring in which a concession is granted to the borrower as a result of economic or legal reasons related to the borrower’s financial difficulties. Upon the adoption of ASU 2019-05 as of January 1, 2020 this line item has been eliminated for all prospective reporting periods
Secured Financing
Asset-backed revolving debt facility
VIEs
Variable interest entities
Weighted Average Interest Rate
Annualized interest expense as a percentage of average debt
(1) Credit card data has been excluded from these metrics for the three and nine months ended September 30, 2020 because they are de minimis.
4
PART I ‑ FINANCIAL INFORMATION
Item 1. Financial Statements
OPORTUN FINANCIAL CORPORATION
Condensed Consolidated Balance Sheets (Unaudited)
(in thousands, except share and per share data)
September 30,
December 31,
2020
2019
Assets
Cash and cash equivalents
$
109,656
$
72,179
Restricted cash
53,824
63,962
Loans receivable at fair value
1,605,388
1,882,088
Loans receivable at amortized cost
—
42,546
Less:
Unamortized deferred origination costs and fees, net
—
(103)
Allowance for loan losses
—
(3,972)
Loans receivable at amortized cost, net
—
38,471
Loans held for sale
1,046
715
Interest and fees receivable, net
16,535
17,185
Right of use assets - operating
48,762
50,503
Other assets
82,312
76,771
Total assets
$
1,917,523
$
2,201,874
Liabilities and stockholders' equity
Liabilities
Secured financing
$
191,180
$
60,910
Asset-backed notes at fair value
1,125,444
1,129,202
Asset-backed notes at amortized cost
—
359,111
Amount due to whole loan buyer
26,810
33,354
Lease liabilities
51,692
53,357
Other liabilities
69,376
77,174
Total liabilities
1,464,502
1,713,108
Stockholders' equity
Preferred stock, $0.0001 par value - 100,000,000 shares authorized at September 30, 2020 and December 31, 2019; 0 shares issued and outstanding at September 30, 2020 and December 31, 2019
—
—
Preferred stock, additional paid-in capital
—
—
Common stock, $0.0001 par value - 1,000,000,000 shares authorized at September 30, 2020 and December 31, 2019; 27,855,051 shares issued and 27,583,028 shares outstanding at September 30, 2020; 27,262,639 shares issued and 27,003,157 shares outstanding at December 31, 2019
6
6
Common stock, additional paid-in capital
431,673
418,299
Common stock warrants
—
63
Accumulated other comprehensive loss
(268)
(162)
Retained earnings
27,919
76,679
Treasury stock at cost, 272,023 and 259,482 shares at September 30, 2020 and December 31, 2019
(6,309)
(6,119)
Total stockholders’ equity
453,021
488,766
Total liabilities and stockholders' equity
$
1,917,523
$
2,201,874
See Notes to the Condensed Consolidated Financial Statements.
5
OPORTUN FINANCIAL CORPORATION
Condensed Consolidated Statements of Operations and Comprehensive Income (Unaudited)
(in thousands, except share and per share data)
Three Months Ended September 30,
Nine Months Ended September 30,
2020
2019
2020
2019
Revenue
Interest income
$
128,739
$
139,272
$
415,525
$
395,778
Non-interest income
8,028
14,608
27,377
39,026
Total revenue
136,767
153,880
442,902
434,804
Less:
Interest expense
13,408
15,499
44,879
44,751
Provision (release) for loan losses
—
(426)
—
(3,755)
Decrease in fair value
(29,633)
(24,339)
(177,584)
(78,567)
Net revenue
93,726
114,468
220,439
315,241
Operating expenses:
Technology and facilities
31,641
26,772
93,927
72,849
Sales and marketing
20,634
24,717
65,521
69,084
Personnel
26,662
28,637
79,925
66,414
Outsourcing and professional fees
11,491
16,041
36,232
42,797
General, administrative and other
11,138
3,886
17,591
10,816
Total operating expenses
101,566
100,053
293,196
261,960
Income (loss) before taxes
(7,840)
14,415
(72,757)
53,281
Income tax expense (benefit)
(1,794)
4,386
(19,162)
14,846
Net income (loss)
$
(6,046)
$
10,029
$
(53,595)
$
38,435
Change in post-termination benefit obligation
6
8
(106)
(36)
Total comprehensive income (loss)
$
(6,040)
$
10,037
$
(53,701)
$
38,399
Net income (loss) attributable to common stockholders
$
(6,046)
$
(27,427)
$
(53,595)
$
—
Share data:
Earnings (loss) per share:
Basic
$
(0.22)
$
(6.39)
$
(1.97)
$
—
Diluted
$
(0.22)
$
(6.39)
$
(1.97)
$
—
Weighted average common shares outstanding:
Basic
27,459,192
4,294,107
27,237,246
3,397,503
Diluted
27,459,192
4,294,107
27,237,246
3,397,503
See Notes to the Condensed Consolidated Financial Statements.
6
OPORTUN FINANCIAL CORPORATION
Condensed Consolidated Statements of Changes in Stockholders' Equity (Unaudited)
(in thousands, except share data)
For the Nine Months Ended September 30, 2020
Convertible Preferred Stock
Common Stock Warrants
Common Stock
Shares
Par Value
Additional Paid-in Capital
Shares
Par Value
Shares
Par Value
Additional Paid-in Capital
Accumulated Other Comprehensive Income (Loss)
Retained Earnings
Treasury Stock
Total Stockholders' Equity
Balance – January 1, 2020
—
$
—
$
—
23,512
$
63
27,003,157
$
6
$
418,299
$
(162)
$
76,679
$
(6,119)
$
488,766
Issuance of common stock upon exercise of stock options
—
—
—
—
—
3,161
—
20
—
—
—
20
Stock-based compensation expense
—
—
—
—
—
—
—
4,151
—
—
—
4,151
Vesting of restricted stock units, net
—
—
—
—
—
137,479
—
(813)
—
—
—
(813)
Cumulative effect of adoption of ASU 2019-05
—
—
—
—
—
—
—
—
—
4,835
—
4,835
Change in post-termination benefit obligation
—
—
—
—
—
—
—
—
(117)
—
—
(117)
Net loss
—
—
—
—
—
—
—
—
—
(13,301)
—
(13,301)
Balance – March 31, 2020
—
$
—
$
—
23,512
$
63
27,143,797
$
6
$
421,657
$
(279)
$
68,213
$
(6,119)
$
483,541
Issuance of common stock upon exercise of stock options
—
$
—
$
—
—
—
22,407
—
79
—
—
—
79
Stock-based compensation expense
—
—
—
—
—
—
—
4,972
—
—
—
4,972
Issuance of common stock upon exercise of warrants
—
—
—
(23,512)
(63)
10,972
—
253
—
—
(190)
—
Vesting of restricted stock units, net
—
—
—
—
—
153,624
—
(17)
—
—
—
(17)
Change in post-termination benefit obligation
—
—
—
—
—
—
—
—
5
—
—
5
Net loss
—
—
—
—
—
—
—
—
—
(34,248)
—
(34,248)
Balance – June 30, 2020
—
$
—
$
—
—
$
—
27,330,800
$
6
$
426,944
$
(274)
$
33,965
$
(6,309)
$
454,332
Issuance of common stock upon exercise of stock options
—
$
—
$
—
—
—
4,018
—
24
$
—
—
—
24
Stock-based compensation expense
—
—
—
—
—
—
—
5,194
—
—
—
5,194
Vesting of restricted stock units, net
—
—
—
—
—
248,210
—
(489)
—
—
—
(489)
Change in post-termination benefit obligation
—
—
—
—
—
—
—
—
6
—
—
6
Net loss
—
—
—
—
—
—
—
—
—
(6,046)
—
(6,046)
Balance – September 30, 2020
—
$
—
$
—
—
$
—
27,583,028
$
6
$
431,673
$
(268)
$
27,919
$
(6,309)
$
453,021
See Notes to the Condensed Consolidated Financial Statements.
7
OPORTUN FINANCIAL CORPORATION
Condensed Consolidated Statements of Changes in Stockholders' Equity (Unaudited)
(in thousands, except share data)
For the Nine Months Ended September 30, 2019
Convertible Preferred Stock
Convertible Preferred and Common Stock Warrants
Common Stock
Shares
Par Value
Additional Paid-in Capital
Shares
Par Value
Shares
Par Value
Additional Paid-in Capital
Accumulated Other Comprehensive Income (Loss)
Retained Earnings
Treasury Stock
Total Stockholders' Equity
Balance – January 1, 2019
14,043,977
$
16
$
257,887
24,959
$
130
2,935,249
$
3
$
44,411
$
(132)
$
52,662
$
(8,428)
$
346,549
Issuance of common stock upon exercise of stock options
—
—
—
—
—
7,317
—
142
—
—
—
142
Stock-based compensation expense
—
—
—
—
—
—
—
1,980
—
—
—
1,980
Cumulative effect of adoption of ASC 842
—
—
—
—
—
—
—
—
—
(125)
—
(125)
Change in post-termination benefit obligation
—
—
—
—
—
—
—
—
(3)
—
—
(3)
Net income
—
—
—
—
—
—
—
—
—
14,614
—
14,614
Balance – March 31, 2019
14,043,977
$
16
$
257,887
24,959
$
130
2,942,566
$
3
$
46,533
$
(135)
$
67,151
$
(8,428)
$
363,157
Issuance of common stock upon exercise of stock options
—
—
—
—
—
2,216
—
4
—
—
—
4
Stock-based compensation expense
—
—
—
—
—
—
—
2,035
—
—
—
2,035
Change in post-termination benefit obligation
—
—
—
—
—
—
—
—
(41)
—
—
(41)
Net income
—
—
—
—
—
—
—
—
—
13,792
—
13,792
Balance – June 30, 2019
14,043,977
$
16
$
257,887
24,959
$
130
2,944,782
$
3
$
48,572
$
(176)
$
80,943
$
(8,428)
$
378,947
Issuance of common stock upon exercise of stock options
—
—
—
—
—
96,371
—
645
—
—
—
645
Repurchase of stock options
—
—
—
—
—
—
—
(86)
—
—
—
(86)
Issuance of common stock upon initial public offering, net of offering costs
—
—
—
—
—
4,873,356
—
60,479
—
—
—
60,479
Stock-based compensation expense
—
—
—
—
—
—
—
11,163
—
—
—
11,163
Conversion of convertible preferred stock to common stock in connection with initial public offering
(14,043,977)
(16)
(257,887)
—
—
19,075,167
3
295,356
—
(37,456)
—
—
Issuance of convertible preferred stock and conversion to common stock upon exercise of warrants, net
—
—
—
(9,090)
(67)
3,969
—
67
—
—
—
—
Vesting of restricted stock units
—
—
—
—
—
11,627
—
—
—
—
—
—
Restricted stock units tax withholding
—
—
—
—
—
(4,021)
—
—
—
—
(68)
(68)
Change in post-termination benefit obligation
—
—
—
—
—
—
—
—
8
—
—
8
Net income
—
—
—
—
—
—
—
—
—
10,029
—
10,029
Balance – September 30, 2019
—
$
—
$
—
15,869
$
63
27,001,251
$
6
$
416,196
$
(168)
$
53,516
$
(8,496)
$
461,117
See Notes to the Condensed Consolidated Financial Statements.
8
OPORTUN FINANCIAL CORPORATION
Condensed Consolidated Statements of Cash Flow (Unaudited)
(in thousands)
Nine Months Ended September 30,
2020
2019
Cash flows from operating activities
Net income (loss)
$
(53,595)
$
38,435
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization
14,878
9,658
Fair value adjustment, net
177,584
78,567
Origination fees for loans receivable at fair value, net