Oct 21, 2026 earnings call — Fiscal results and FY2027 guidance
Pathward reiterates fiscal 2027 guidance of $9.50 to $10 per share.
Revenue $0.2B (est $0.2B) · EPS $1.85 (est $1.58)
Key quotes
"This quarter, we are pleased to announce that we have renewed our contract with long standing partner H&R Block, extending our relationship through mid-2030."
"We continue to expect credit to normalize in 2027, as we work down our nonperforming loans."
"For fiscal 2027, we expect those investments to begin in the December quarter."
Analyst Q&A 4
Where new partners come from
Q (Timothy Switzer · KBW): He asked which industries new partners will come from and whether growth is more from credit sponsorship or embedded finance. He also asked where the company is investing to keep up with competition.
A: Management said partner origin will be broad across industries and product types, and revenue increases come from both new partners and existing partners. They are investing in technology and back-end infrastructure and also in risk and compliance to stay ahead.
"This is all about the breadth and depth of our offerings and our partners really want to understand that and be a part of it." — Brett L. Pharr (CEO)
Originations trend and securities portfolio
Q (Joseph Yanchunis · Raymond James): He asked whether the rise in new originations is a new normalized run rate or an acceleration and what themes will shape BaaS over the next five years. He also asked where the securities portfolio will settle.
A: Brett said the recent originations represent a new run rate based on the programs and partners they have announced and onboarded, and they expect continued growth from partner programs and the partner base. Gregory said the securities portfolio can be allowed to run down and likely normalize around "$800 million to a $1 billion range."
"I think we can let that run down to the $800 million to perhaps a $1 billion range." — Gregory A. Sigrist (CFO)
Interest rate impact on margin and credit
Q (Manuel Navas · Piper Sandler): He asked how recent rate hikes and a possible December hike affect NIM, EPS trajectory, and credit. He also asked whether partners are pursuing national charters and about customer concentration and card fee trends.
A: Gregory said the firm has been largely rate-neutral, a 25-basis-point raise would be perhaps $2 million pretax or a little more for the full year, and recent production shifted toward floating-rate loans making them slightly asset-sensitive but expected to normalize over the next couple years. Brett said higher rates can benefit their asset-based lending and working capital portfolios, a 200 basis point rise would slow some commercial business but they would often win more opportunities, and only a small subset of partners have discussed charters. He also said, "No partner represents more than 5% of Pathward's revenue."
"So this point, if we have a 25-basis-point raise in December or the next meeting, it is perhaps $2 million pretax, maybe a little bit more for the full year." — Gregory A. Sigrist (CFO)
Seasonality and card fee drivers
Q (Timothy Switzer · KBW): He asked whether seasonality has changed, for example a stronger Q4 than historical, and whether new partner onboarding changed that. He also asked how much of the card fee acceleration is from new programs versus existing partners.
A: Gregory said onboarding new products and partners has flattened seasonality a bit, though prepaid card deposits and fee timing still create some regular quarter-to-quarter swings and contractual incentive payments can skew one quarter versus another. He said year-over-year growth will continue to be driven mostly by existing partners, historically about 75% to 80% of the uplift, while new partners typically take longer to ramp.
"I think you are always gonna see, for the foreseeable future, growth year over year is still gonna be driven more by existing partners." — Gregory A. Sigrist (CFO)