Is OppFi's Operational Efficiency Essential for Profitability?

OppFi’s OPFI third-quarter 2025 performance is a testament to operational efficiency, driven by a combination of technological prowess and disciplined cost management, improving profitability. Starting with the top line, we found that the company posted solid 13.5% year-over-year growth, highlighting sustained customer demand.

This enriching growth in the top line was accompanied by a marginal hike in total expenses. However, a substantial decline in total expenses as a percentage of revenues was recorded, wherein the metric fell 500 basis points (bps) from the year-ago quarter. This striking improvement was facilitated by OppFi’s Model 6 and LOLA, raising auto-approval rates 230 bps from the year-ago quarter to 79.1%. Increased automation for loan decisions lowers the reliance on human underwriters, stripping away operational costs by a significant margin.

As expenses declined, OPFI witnessed an exponential growth in its profitability. In the third quarter of 2025, adjusted net income improved 41.4% year over year, and its margins expanded a whopping 500 bps. This robust growth is not a one-off event, but a prolonged trend evidenced by an 82.7% year-over-year upsurge in adjusted net income, translating to a 1,000 bps margin expansion in the nine months ended Sept. 30 of this year.

The disproportionality in OPFI’s revenues and adjusted net income growth demonstrates operational efficiency, essential while scaling the business, ensuring profitability sustainability in the long haul.

OppFi’s heavy reliance on technology optimizes its cost structure, creating an efficiency buffer that reduces the inherent credit default risk associated with its business structure. Management is heavily reliant on the company’s core technology, underscoring a heightened focus on operational efficiency. Motivations are apparent from the upward revision in adjusted net income to $137-$142 million for the year from that projected in the previous two quarters.

OPFI’s Price Performance, Valuation & Estimates

OppFi stock has risen 27.4% in the past year, significantly outperforming the 12.2% dip in its industry. The stock outperformed its industry peer Corpay’s CPAY 20.9% decline and Cantaloupe’s CTLP 17.1% growth during the same timeframe.

1-Year Share Price Performance