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NAVI Q4 Earnings Top on Lower Expenses, Shares Fall as NII Decline Y/Y
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Key Takeaways
NAVI posted Q4 adjusted EPS of 39 cents, beating estimates, but shares fell nearly 10.8% in early trading.
NAVI benefited from lower expenses and provisions despite weaker net interest income.
Federal Education Loans net income jumped to $27M, while Consumer Lending income dropped 32.4% year over year.
Navient Corporation (NAVI - Free Report) reported fourth-quarter 2025 adjusted earnings per share (EPS) of 39 cents, surpassing the Zacks Consensus Estimate of 31 cents. It reported earnings of 25 cents in the prior-year quarter.
Results benefited from lower expenses and a slight decline in provisions for loan losses. However, a decrease in net interest income (NII) and other income acted as a headwind. Given the concern, NAVI shares lost nearly 10.8% in the early trading session. A full day’s trading session will depict a clearer picture.
Results included a 26 cents per share impact from provisions for loan losses, primarily reflecting the macroeconomic outlook and fourth-quarter delinquency trends in the legacy Private Education Loan portfolio, with a portion related to new originations. Additionally, there were regulatory and restructuring-related expenses of 11 cents per share. After considering these, GAAP net loss was $5 million against a net income of $24 million in the prior-year quarter.
For 2025, adjusted loss per share was 35 cents, wider than the Zacks Consensus Estimate of a loss of 6 cents per share. This compares unfavorably with the adjusted EPS of $2 reported in the prior year. The company reported a GAAP net loss of $80 million against a net income of $131 million reported in the prior year.
Navient’s NII & Expenses Decline
NII declined 3.7% year over year to $129 million in the fourth quarter. It missed the Zacks Consensus Estimate by 3.3%.
In 2025, core NII was down 3.8% from the prior year to $551 million. Also, the top line missed the Zacks Consensus Estimate of $553.8 million.
Total other income decreased 48.3% year over year to $15 million.
Provision for loan losses was $44 million, down from $45 million in the prior-year quarter.
Total expenses decreased 34.2% year over year to $100 million.
NAVI’s Quarterly Performance of Segments
Federal Education Loans: The segment generated a net income of $27 million, which rose significantly from the $10 million reported in the year-ago quarter.
As of Dec. 31, 2025, the company’s net FFELP loans were $28.1 billion, down 2.8% sequentially.
Consumer Lending: This segment reported a net income of $25 million, which decreased 32.4% from the year-ago quarter.
The private education loan delinquency rate greater than 30 days was 6.3% compared with 6.1% in the prior-year quarter.
As of Dec. 31, 2025, the company’s private education loans were $15.4 billion, which decreased marginally from the prior quarter. Navient originated $634 million of private education refinance loans in the reported quarter.
Business Processing: The company no longer provides Business Processing segment services after the sale of the government services business in February 2025.
Navient’s Liquidity
To meet liquidity needs, NAVI expects to utilize various sources, including cash and investment portfolio, predictable operating cash flows provided by operating activities, the repayment of principal on unencumbered education loan assets and distributions from securitization trusts. It may also draw down on the secured FFELP Loan and Private Education Loan facilities, issue term asset-backed securities (ABS), enter additional Private Education Loan and ABS repurchase facilities, or issue additional unsecured debt.
Notably, the company had $637 million of total unrestricted cash and liquid investments as of Dec. 31, 2025.
Navient’s Capital Distribution Activities
In the fourth quarter, the company paid $15 million in common stock dividends.
In the reported quarter, Navient repurchased shares of common stock for $26 million.
Our Take on NAVI
Navient has been an eminent portfolio holder of private education loans. Its diversified business segments are likely to support revenue growth. The strategic actions undertaken to control expenses are expected to support financials in the upcoming period. The company’s fourth-quarter results benefited from lower expenses and a modest decline in provisions. However, weaker NII remains a near-term concern.
Navient Corporation Price, Consensus and EPS Surprise
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.
The results of ALLY 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.
Citizens Financial Group (CFG - Free Report) reported fourth-quarter 2025 earnings per share of $1.13, which surpassed the Zacks Consensus Estimate of $1.11 per share. The metric rose 32.9% from the year-ago quarter.
Results benefited from a rise in non-interest income and net interest income. The increase in loan and deposit balances was also encouraging. However, a rise in expenses was a major headwind for CFG.
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NAVI Q4 Earnings Top on Lower Expenses, Shares Fall as NII Decline Y/Y
Key Takeaways
Navient Corporation (NAVI - Free Report) reported fourth-quarter 2025 adjusted earnings per share (EPS) of 39 cents, surpassing the Zacks Consensus Estimate of 31 cents. It reported earnings of 25 cents in the prior-year quarter.
Results benefited from lower expenses and a slight decline in provisions for loan losses. However, a decrease in net interest income (NII) and other income acted as a headwind. Given the concern, NAVI shares lost nearly 10.8% in the early trading session. A full day’s trading session will depict a clearer picture.
Results included a 26 cents per share impact from provisions for loan losses, primarily reflecting the macroeconomic outlook and fourth-quarter delinquency trends in the legacy Private Education Loan portfolio, with a portion related to new originations. Additionally, there were regulatory and restructuring-related expenses of 11 cents per share. After considering these, GAAP net loss was $5 million against a net income of $24 million in the prior-year quarter.
For 2025, adjusted loss per share was 35 cents, wider than the Zacks Consensus Estimate of a loss of 6 cents per share. This compares unfavorably with the adjusted EPS of $2 reported in the prior year. The company reported a GAAP net loss of $80 million against a net income of $131 million reported in the prior year.
Navient’s NII & Expenses Decline
NII declined 3.7% year over year to $129 million in the fourth quarter. It missed the Zacks Consensus Estimate by 3.3%.
In 2025, core NII was down 3.8% from the prior year to $551 million. Also, the top line missed the Zacks Consensus Estimate of $553.8 million.
Total other income decreased 48.3% year over year to $15 million.
Provision for loan losses was $44 million, down from $45 million in the prior-year quarter.
Total expenses decreased 34.2% year over year to $100 million.
NAVI’s Quarterly Performance of Segments
Federal Education Loans: The segment generated a net income of $27 million, which rose significantly from the $10 million reported in the year-ago quarter.
As of Dec. 31, 2025, the company’s net FFELP loans were $28.1 billion, down 2.8% sequentially.
Consumer Lending: This segment reported a net income of $25 million, which decreased 32.4% from the year-ago quarter.
The private education loan delinquency rate greater than 30 days was 6.3% compared with 6.1% in the prior-year quarter.
As of Dec. 31, 2025, the company’s private education loans were $15.4 billion, which decreased marginally from the prior quarter. Navient originated $634 million of private education refinance loans in the reported quarter.
Business Processing: The company no longer provides Business Processing segment services after the sale of the government services business in February 2025.
Navient’s Liquidity
To meet liquidity needs, NAVI expects to utilize various sources, including cash and investment portfolio, predictable operating cash flows provided by operating activities, the repayment of principal on unencumbered education loan assets and distributions from securitization trusts. It may also draw down on the secured FFELP Loan and Private Education Loan facilities, issue term asset-backed securities (ABS), enter additional Private Education Loan and ABS repurchase facilities, or issue additional unsecured debt.
Notably, the company had $637 million of total unrestricted cash and liquid investments as of Dec. 31, 2025.
Navient’s Capital Distribution Activities
In the fourth quarter, the company paid $15 million in common stock dividends.
In the reported quarter, Navient repurchased shares of common stock for $26 million.
Our Take on NAVI
Navient has been an eminent portfolio holder of private education loans. Its diversified business segments are likely to support revenue growth. The strategic actions undertaken to control expenses are expected to support financials in the upcoming period. The company’s fourth-quarter results benefited from lower expenses and a modest decline in provisions. However, weaker NII remains a near-term concern.
Navient Corporation Price, Consensus and EPS Surprise
Navient Corporation price-consensus-eps-surprise-chart | Navient Corporation Quote
Currently, NAVI carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Navient’s Peers
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.
The results of ALLY 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.
Citizens Financial Group (CFG - Free Report) reported fourth-quarter 2025 earnings per share of $1.13, which surpassed the Zacks Consensus Estimate of $1.11 per share. The metric rose 32.9% from the year-ago quarter.
Results benefited from a rise in non-interest income and net interest income. The increase in loan and deposit balances was also encouraging. However, a rise in expenses was a major headwind for CFG.