Enova: $1.7B in Business Loans in Q1, New Record, Competition Hasn’t Changed

“Our SMB business continued to deliver remarkable growth and stable credit as our leading brand presence, scale, and strong competitive position drove 42% year-over-year growth in originations to a record 1.7 billion dollars,” said Enova CEO Steve Cunningham during the Q1 earnings call. “Our SMB portfolio has grown 37% over the past year and remains intentionally well diversified across geographies and industries. In addition, the SMB net charge-off ratio remained in a tight range consistent with the past two years.”

The company indicated that economic signals look strong despite rising gas prices and that they expect the growth in SMB lending to continue.

When Kyle Joseph at Stephens asked Cunningham to size up the competitive environment they face in their sector, Cunningham said that they have the advantages.

Cunningham:

“The SMB market is large, and new business formation over the past five or six years has been really strong if you look at new business applications. Those companies that are a couple of years into their life and have shown staying ability become potential customers. So the market is growing, probably a little faster than the overall consumer market. Regarding our presence, brand, scale, and capabilities, our set of competitors has not really changed much over time, and we believe we have a lot of advantages. It is a great setup: a large, growing market and competitive advantages that allow us to be selective and generate growth that creates strong returns for us and our shareholders.”