We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
ALLY posted Q4 adjusted EPS of $1.09, beating estimates, with GAAP net income rising to $300 million.
Ally Financial benefited from higher net finance revenue, lower provisions and expenses, and a 3.51% NIM.
ALLY saw loans and deposits rise sequentially as non-performing loans and charge-offs declined.
Ally Financial’s (ALLY - Free Report) fourth-quarter 2025 adjusted earnings of $1.09 per share surpassed the Zacks Consensus Estimate of $1.01. The bottom line reflected a 39.7% jump from the year-ago quarter.
Results primarily benefited from a rise in net finance revenues and other revenues. Also, lower provisions and a decline in expenses were tailwinds. An increase in loan balances further supported the results to some extent.
After considering non-recurring items, net income attributable to common shareholders (GAAP basis) was $300 million compared with $81 million in the prior-year quarter.
Adjusted earnings of $3.81 per share for 2025 surpassed the Zacks Consensus Estimate of $3.74. The bottom line increased 62.1% from the previous year. Net income attributable to common shareholders (GAAP basis) was $742 million compared with $558 million in 2024.
Total quarterly GAAP net revenues were $2.12 billion, up 4.8% from the prior-year quarter. However, the top line marginally missed the Zacks Consensus Estimate of $2.13 billion. Adjusted total revenues were $2.17 billion, up 3.7% from the prior-year quarter.
Total GAAP net revenues in 2025 were $7.91 billion, down 3.3% from the previous year. The top line marginally missed the Zacks Consensus Estimate of $7.92 billion.
Quarterly net financing revenues grew 5.9% from the prior-year quarter to $1.60 billion. The rise was primarily driven by lower interest expenses. The adjusted net interest margin was 3.51%, up 18 basis points.
Total other revenues were $525 million, up 1.5% year over year. The rise was primarily driven by a rise in net other gain on investments.
Total non-interest expenses declined 8.1% year over year to $1.25 billion.
The adjusted efficiency ratio was 50.8%, down from 52.8% in the year-ago period. A fall in the efficiency ratio indicates an improvement in profitability.
ALLY’s Loans & Deposit Balances Rise
As of Dec. 31, 2025, total net finance receivables and loans amounted to $134 billion, up 2.2% from the prior-quarter end.
Deposits also increased 2.2% on a sequential basis to $151.6 billion.
Ally Financial’s Credit Quality Improves
Non-performing loans were $1.37 billion as of Dec. 31, 2025, down 8.1% year over year. In the reported quarter, Ally Financial recorded net charge-offs of $452 million, down 16.8% from the prior-year quarter.
Further, provision for loan losses was $487 million, down 12.6% year over year. The decline was led by continued retail auto net charge-off improvement and the sale of Credit Card.
Capital Ratios of ALLY Improve
As of Dec. 31, 2025, the total capital ratio was 13.6%, up from 13.2% in the prior-year period. The tier 1 capital ratio was 11.7%, up from 11.3% as of Dec. 31, 2024.
Also, the common equity tier 1 (CET1) capital ratio increased to 10.2% from 9.8% in the prior-year period.
Our View on Ally Financial
ALLY’s business-restructuring initiatives, balance sheet repositioning efforts and rising demand for consumer loans will likely strengthen its financials. However, weak credit quality amid a tough operating backdrop remains a key near-term headwind.
Ally Financial Inc. Price, Consensus and EPS Surprise
The PNC Financial Services Group, Inc.’s (PNC - Free Report) fourth-quarter 2025 earnings per share of $4.88 surpassed the Zacks Consensus Estimate of $4.23. In the prior-year quarter, the company reported EPS of $3.77.
PNC’s results were aided by record revenue growth, driven by a rise in net interest income and fee income. Rising loan and deposit balances, along with a decline in provisions for credit losses, were other positives. However, an increase in expenses acted as a spoilsport.
KeyCorp’s (KEY - Free Report) fourth-quarter 2025 adjusted earnings per share from continuing operations of 41 cents outpaced the Zacks Consensus Estimate of 38 cents. The bottom line reflected a 7.9% rise from the prior-year quarter.
KEY’s results primarily benefited from higher net interest income and non-interest income. The rise in average loans and deposit balances was another positive. However, higher expenses and a jump in provisions were the undermining factors.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
ALLY Q4 Earnings Beat as Revenues Grow Y/Y & Provisions Decline
Key Takeaways
Ally Financial’s (ALLY - Free Report) fourth-quarter 2025 adjusted earnings of $1.09 per share surpassed the Zacks Consensus Estimate of $1.01. The bottom line reflected a 39.7% jump from the year-ago quarter.
Results primarily benefited from a rise in net finance revenues and other revenues. Also, lower provisions and a decline in expenses were tailwinds. An increase in loan balances further supported the results to some extent.
After considering non-recurring items, net income attributable to common shareholders (GAAP basis) was $300 million compared with $81 million in the prior-year quarter.
Adjusted earnings of $3.81 per share for 2025 surpassed the Zacks Consensus Estimate of $3.74. The bottom line increased 62.1% from the previous year. Net income attributable to common shareholders (GAAP basis) was $742 million compared with $558 million in 2024.
Ally Financial’s Revenues Improve, Expenses Decline
Total quarterly GAAP net revenues were $2.12 billion, up 4.8% from the prior-year quarter. However, the top line marginally missed the Zacks Consensus Estimate of $2.13 billion. Adjusted total revenues were $2.17 billion, up 3.7% from the prior-year quarter.
Total GAAP net revenues in 2025 were $7.91 billion, down 3.3% from the previous year. The top line marginally missed the Zacks Consensus Estimate of $7.92 billion.
Quarterly net financing revenues grew 5.9% from the prior-year quarter to $1.60 billion. The rise was primarily driven by lower interest expenses. The adjusted net interest margin was 3.51%, up 18 basis points.
Total other revenues were $525 million, up 1.5% year over year. The rise was primarily driven by a rise in net other gain on investments.
Total non-interest expenses declined 8.1% year over year to $1.25 billion.
The adjusted efficiency ratio was 50.8%, down from 52.8% in the year-ago period. A fall in the efficiency ratio indicates an improvement in profitability.
ALLY’s Loans & Deposit Balances Rise
As of Dec. 31, 2025, total net finance receivables and loans amounted to $134 billion, up 2.2% from the prior-quarter end.
Deposits also increased 2.2% on a sequential basis to $151.6 billion.
Ally Financial’s Credit Quality Improves
Non-performing loans were $1.37 billion as of Dec. 31, 2025, down 8.1% year over year. In the reported quarter, Ally Financial recorded net charge-offs of $452 million, down 16.8% from the prior-year quarter.
Further, provision for loan losses was $487 million, down 12.6% year over year. The decline was led by continued retail auto net charge-off improvement and the sale of Credit Card.
Capital Ratios of ALLY Improve
As of Dec. 31, 2025, the total capital ratio was 13.6%, up from 13.2% in the prior-year period. The tier 1 capital ratio was 11.7%, up from 11.3% as of Dec. 31, 2024.
Also, the common equity tier 1 (CET1) capital ratio increased to 10.2% from 9.8% in the prior-year period.
Our View on Ally Financial
ALLY’s business-restructuring initiatives, balance sheet repositioning efforts and rising demand for consumer loans will likely strengthen its financials. However, weak credit quality amid a tough operating backdrop remains a key near-term headwind.
Ally Financial Inc. Price, Consensus and EPS Surprise
Ally Financial Inc. price-consensus-eps-surprise-chart | Ally Financial Inc. Quote
Currently, Ally Financial carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Finance Stocks
The PNC Financial Services Group, Inc.’s (PNC - Free Report) fourth-quarter 2025 earnings per share of $4.88 surpassed the Zacks Consensus Estimate of $4.23. In the prior-year quarter, the company reported EPS of $3.77.
PNC’s results were aided by record revenue growth, driven by a rise in net interest income and fee income. Rising loan and deposit balances, along with a decline in provisions for credit losses, were other positives. However, an increase in expenses acted as a spoilsport.
KeyCorp’s (KEY - Free Report) fourth-quarter 2025 adjusted earnings per share from continuing operations of 41 cents outpaced the Zacks Consensus Estimate of 38 cents. The bottom line reflected a 7.9% rise from the prior-year quarter.
KEY’s results primarily benefited from higher net interest income and non-interest income. The rise in average loans and deposit balances was another positive. However, higher expenses and a jump in provisions were the undermining factors.