First Quarter Fiscal Year 2027
Filed Oct 29, 2026Axos Financial, Inc. Reports First Quarter Fiscal Year 2027 Results
Net income increased 15.4% to $129.648 million, diluted EPS increased 16.0% to $2.25, net interest income increased 13.8%, and non-interest income increased 97.3%. Results also included higher credit-loss provision and non-interest expense, while annualized net charge-offs to average loans were 1.09%.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Net interest income, three months ended September 30GAAP | $331.3M | – | 13.8 % |
| Non-interest income, three months ended September 30GAAP | $63.81M | – | 97.3 % |
| Interest and dividend income, three months ended September 30GAAP | $517.1M | – | – |
| Interest expense, three months ended September 30GAAP | 185,821 | – | – |
| Provision for credit losses, three months ended September 30GAAP | 24,500 | – | – |
| Net interest income, after provision for credit losses, three months ended September 30GAAP | 306,756 | – | – |
| Non-interest expense, three months ended September 30GAAP | 195,410 | – | – |
| Income before income taxes, three months ended September 30GAAP | 175,161 | – | – |
| Income tax expense, three months ended September 30GAAP | 45,513 | – | – |
| Net income, three months ended September 30GAAP | $129.6M | – | 15.4 % |
| Adjusted earnings, three months ended September 30non-GAAP | $134.8M | – | 12.0 % |
| Basic EPS, three months ended September 30GAAP | $ 2.28 | – | – |
| Diluted EPS, three months ended September 30GAAP | $ 2.25 | – | 16.0 % |
| Adjusted EPS, three months ended September 30non-GAAP | $ 2.34 | – | 13.0 % |
| Average dilutive common shares outstanding, three months ended September 30GAAP | 57,554,935 | – | – |
| Growth in loans held for investment, net, three months ended September 30other | $316.6M | – | – |
| Loan originations for sale, three months ended September 30other | $47.34M | – | – |
| Return on average assets, three months ended September 30GAAP | 1.72 % | – | – |
| Return on average common stockholders’ equity, three months ended September 30GAAP | 15.66 % | – | – |
| Interest rate spread, three months ended September 30other | 3.91 % | – | – |
| Net interest margin, three months ended September 30other | 4.64 % | up 10 basis points | – |
| Efficiency ratio, three months ended September 30other | 49.46 % | – | – |
| Net annualized charge-offs to average loans, three months ended September 30other | 1.09 % | – | – |
| Non-accrual loans to total loans, September 30other | 0.59 % | – | – |
| Non-performing assets to total assets, September 30other | 0.51 % | – | – |
| Allowance for credit losses - loans to total loans held for investment, September 30other | 1.16 % | – | – |
| Allowance for credit losses - loans to non-accrual loans, September 30other | 195.79 % | – | – |
| Total assets, September 30GAAP | $30.84B | 2.9% | – |
| Loans—net of allowance for credit losses, September 30GAAP | 25,912,024 | – | – |
| Allowance for credit losses, September 30GAAP | 304,361 | – | – |
| Available-for-sale securities, September 30GAAP | 780,585 | – | – |
| Total deposits, September 30GAAP | 25,413,197 | – | – |
| Advances from the Federal Home Loan Bank, September 30GAAP | 60,000 | – | – |
| Secured financings, September 30GAAP | 511,647 | – | – |
| Borrowings, subordinated notes and debentures, September 30GAAP | 343,166 | – | – |
| Total stockholders’ equity, September 30GAAP | $3.29B | 3.9% | – |
| Book value per common share, September 30GAAP | $ 57.92 | – | 17.5% |
| Tangible book value per common share, September 30non-GAAP | $ 52.68 | – | – |
| Equity to assets at end of periodother | 10.66 % | – | – |
| Axos Financial, Inc. common equity tier 1 capital (to risk-weighted assets)other | 12.22 % | – | – |
| Axos Financial, Inc. total capital (to risk-weighted assets)other | 14.81 % | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Banking Business Segment net interest income, three months ended September 30, 2026The Company reported an increase in interest income earned on loans, partially offset by a decrease in interest income on deposits at other financial institutions and increases in interest expense on advances from the Federal Home Loan Bank and secured financings. | $325.6M | – | – |
| Banking Business Segment non-interest income, three months ended September 30, 2026Non-interest income increased primarily due to operating lease rental and other income from the Verdant acquisition, commercial office complex operating lease rental income and higher prepayment penalty income. | 40.02M | – | – |
| Securities Business Segment net interest income, three months ended September 30, 2026Pretax income for the Securities Business Segment increased by 23.8% year-over-year to $10.3 million. | $10.64M | – | – |
| Securities Business Segment non-interest income, three months ended September 30, 2026The Company stated that inter-segment transactions primarily include non-interest income earned by the Securities Business Segment and non-interest expense incurred by the Banking Business Segment for cash sorting fees related to deposits sourced from Securities Business Segment customers. | 30.50M | – | – |
Amounts quoted below without a unit are in thousands, as in the filing’s tables. Per-share figures are as printed.
Capital returns
- During the quarter ended September 30, 2026 and through October 23, 2026, the Company repurchased $14.0 million of Axos common stock at an average price of $87.40 per share.
- As of October 23, 2026 the Company had $112.1 million of share repurchase authorization remaining under the Company’s common stock repurchase program.
What drove it
- Net interest income increased $40.2 million, or 13.8%, primarily due to an increase in interest income earned on loans.
- Non-interest income increased primarily due to operating lease rental and other income from the Verdant acquisition, commercial office complex operating lease rental income and higher prepayment penalty income.
- Total deposits increased by $847.8 million from June 30, 2026, including the acquisition of deposits from Capital One.
- Ending loans grew by approximately $563 million excluding net paydowns in single-family mortgage and warehouse, multifamily and small balance commercial real estate.
- The provision for credit losses was primarily driven by certain individually assessed loans, partially offset by a benefit in the Commercial Real Estate portfolio and lower expected losses on unfunded lending commitments.
Concerns
- Provision for credit losses was $24.5 million, compared to $17.3 million for the three months ended September 30, 2025.
- Annualized net charge-offs to average loans were 1.09%, compared to 0.11% for the three months ended September 30, 2025.
- Non-interest expense increased $39.2 million to $195.4 million, driven by higher depreciation and amortization, salaries and related costs, general and administrative expense, and data and operational processing expense.
- The efficiency ratio was 49.46%, compared to 48.32% for the three months ended September 30, 2025.
- Net interest margin was 4.64%, compared to 4.75% for the three months ended September 30, 2025.
What to watch
- Management expects a few large loans that did not close in the September 2026 quarter to drive an acceleration in overall loan growth in the December 2026 quarter.
- Loan pipeline remained solid, according to management.
- Credit-loss provisioning was affected by certain individually assessed loans.
- Deposit growth and the impact of the acquisition of deposits from Capital One.
- Net interest margin following the 10 basis point quarter-over-quarter increase to 4.64%.
Balance sheet and cash flow
- Total assets were $ 30,844,961 at September 30, 2026, compared to $ 29,961,869 at June 30, 2026.
- Total deposits were 25,413,197 at September 30, 2026, compared to 24,565,392 at June 30, 2026.
- Advances from the Federal Home Loan Bank were 60,000 at September 30, 2026, compared to 154,000 at June 30, 2026.
- Secured financings were 511,647 at September 30, 2026, compared to 576,680 at June 30, 2026.
- Total stockholders’ equity was $ 3,288,794 at September 30, 2026, compared to $ 3,166,418 at June 30, 2026.
- Cash flow from operations and free cash flow were not reported.
Analysis
Axos reported first-quarter fiscal 2027 GAAP net income of $129.648 million and diluted EPS of $2.25, compared with $112.352 million and $1.94, respectively, in the prior-year quarter. Adjusted earnings were $134.838 million and adjusted EPS was $2.34, compared with $120.377 million and $2.07. The earnings increase was supported by 13.8% growth in net interest income and a 97.3% increase in non-interest income.
Net interest income was $331.256 million. Management attributed the increase primarily to higher interest income earned on loans, partly offset by lower interest income on deposits at other financial institutions and higher expense on Federal Home Loan Bank advances and secured financings. Net interest margin was 4.64%, up 10 basis points from 4.54% in the preceding quarter, although below 4.75% in the prior-year quarter. Ending net loan balances were $25.9 billion, reflecting loan growth of $316.6 million during the quarter, while management cited approximately $563 million of ending-loan growth excluding net paydowns in specified mortgage and commercial real estate categories.
Non-interest income reached $63.815 million from $32.340 million. The stated drivers were Verdant-related operating lease rental and other income, commercial office complex operating lease rental income and higher prepayment penalty income. Non-interest expense increased to $195.410 million from $156.246 million, with higher depreciation and amortization, salaries and related costs, general and administrative expense, and data and operational processing expense. The efficiency ratio was 49.46%, compared with 48.32% in the prior-year quarter.
Credit costs increased, with provision for credit losses of $24.500 million versus $17.255 million. The provision reflected certain individually assessed loans, partly offset by a Commercial Real Estate portfolio benefit and lower expected losses on unfunded lending commitments. Net annualized charge-offs to average loans were 1.09%, compared with 0.11%, while management stated that excluding two non-performing C&I loan charge-offs, annualized net charge-offs to average loans were 0.08%. Non-performing assets to total assets improved to 0.51% from 0.64%.
The balance sheet expanded as total assets rose to $30.845 billion from $29.962 billion at June 30, 2026, and total deposits increased to $25.413 billion from $24.565 billion. Stockholders’ equity increased to $3.289 billion from $3.166 billion, and book value per common share increased to $57.92 from $49.31 a year earlier. Axos repurchased $14.0 million of common stock during the quarter and through October 23, 2026, leaving $112.1 million of authorization. The release did not provide formal financial guidance, but management expects several large loans that did not close in the September quarter to support accelerated loan growth in the December 2026 quarter.
Management, verbatim
Net interest margin increased by 10 basis points quarter-over-quarter, resulting in a 16.8% annualized growth in net interest income.
Greg Garrabrants, President and Chief Executive Officer of Axos
Our loan pipeline remains solid, and we expect a few large loans that did not close in the September 2026 quarter to drive an acceleration in overall loan growth in the December 2026 quarter.
Greg Garrabrants, President and Chief Executive Officer of Axos
We charged off two non-performing C&I loans that we set aside specific loan loss reserves for in prior quarters. Excluding those two C&I charge-offs, our annualized net charge-offs to average loans was 0.08% in the three months ended September 30, 2026.
Derrick Walsh, Chief Financial Officer of Axos
Not in the filing
stated, not guessed- Formal forward revenue, earnings, margin, expense and tax-rate guidance were not reported.
- Prior guidance/outlook was not provided.
- Total revenue was not reported as a consolidated line item.
- Gross margin was not reported.
- Operating income was not reported as a consolidated line item.
- Operating cash flow was not reported.
- Free cash flow was not reported.
- Cash and cash equivalents balance was not reported as a selected balance-sheet line item.
- Dividend amount and dividend declaration were not reported.
- Axos Financial, Inc. Tier 1 leverage and Axos Bank capital-ratio metrics were reported but not individually included in key_metrics due to output scope.
Written by an AI language model from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure is checked against the filing text, and a metric the filing does not print, or whose value, prior period and change do not add up, is dropped from the metrics. The model can still misread a table, in the metrics or in the text, so check a number in the filing before you rely on it. Consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.