EL7.AI
StocksMedium•28 October 2026•
3 min read

Provident Posts $0.25 Per Share, Misses Earnings Estimates Despite Revenue Beat

Key Facts

1Net income fell 28% quarter over quarter and 6% year over year.
2Net interest margin reached 3.32%, up 11 basis points quarter over quarter and 32 basis points year over year.
3The provision for credit losses was $777,000, compared with a $95,000 recovery in the previous quarter and a $626,000 recovery a year earlier.
4Deposits fell 1% to $897.7 million on September 30, 2026.

By contrast, revenue exceeded expectations, making the results mixed rather than a beat on both earnings and revenue. Diluted earnings per share were $0.35 in the previous quarter and $0.25 in the year-earlier period. The figures reflect a year-over-year decline in net income, despite growth in net interest margin and revenue coming in above market expectations.

Net interest margin was 3.32% in the quarter ended September 2026, up 11 basis points from the previous quarter and 32 basis points from the year-earlier period. But the provision for credit losses rose to $777,000, compared with a $95,000 recovery in the previous quarter and a $626,000 recovery a year earlier. Management said higher interest rates extended the expected life of the loan portfolio, contributing to the build in the provision. It added that "credit quality remains excellent," while pointing to higher net interest income and good management of operating expenses. The shift in the provision weighed on the earnings comparison as net interest margin widened from both prior periods.

Loans held for investment totaled $1.04 billion on September 30, 2026, compared with $1.03 billion on June 30. Deposits, by contrast, fell to $897.7 million from $910.4 million at the end of the previous quarter, a decline of 1%. Nonperforming assets were 0.04% of total assets, unchanged from June 30. The allowance for credit losses rose to $6.59 million at the end of September, from $5.85 million at the end of June. These indicators show a slight increase in loans held for investment alongside lower deposits and a higher allowance balance.

The company continued returning capital to shareholders during the quarter, repurchasing 86,431 shares at an average price of $18.30 per share. It also paid a quarterly cash dividend of $0.14 per share, with 88,174 shares remaining available for repurchase at quarter-end. These steps came during a period when net income fell 6% year over year, despite an improved net interest margin. In early trading on October 28, the stock was at $18.15, down 0.27% from the previous session's close of $18.20. The stock made the move the day after the results were announced.

Provident was scheduled to hold a conference call to discuss the results on October 28, 2026, at 9:00 a.m. Pacific time. The company said an audio replay of the call would remain available through November 4. The call gives management an opportunity to present the quarterly results and discuss the indicators cited in its statement. Those indicators include net interest margin, the credit provision, and changes in loans and deposits during the quarter. The call is scheduled after the results, which combined a revenue beat with earnings per share falling short of expectations.