Consumer Portfolio Services' Contract Purchases Hit $815 Million

The Tip Desk · November 8, 2026 · 3 min read

Third-quarter net income rose 43% to $7.0 million as the specialty auto lender bought $815.3 million of contracts, up 108.5% from a year earlier.

Consumer Portfolio Services, Inc. (CPSS), an independent specialty finance company that purchases indirect auto contracts, bought $815.3 million of automobile contracts in the third quarter of 2026, a 108.5% increase from $391.1 million a year earlier.

That pace followed $757.7 million of purchases in the second quarter, up 75% from the year-ago period, and $533.2 million in the first quarter, up 18%. Chief Executive Officer Charles E. Bradley said accelerating origination volume was demonstrating operating leverage, with net income increasing faster than revenue. He said a broader dealership network and deeper relationships with existing dealers allowed the company to accelerate volume and capture market share while remaining selective on contracts.

Total revenue for the quarter was $131.9 million, up 21.7% from $108.4 million in the third quarter of 2025. Interest income was the largest driver of the increase, which the company attributed to growth in the loan portfolio from accelerating origination volume across an expanding dealer network. Revenue growth had been 10.6% in the second quarter and 5.1% in the first.

Net income rose 43.3% to $7.0 million from $4.9 million a year earlier. Diluted earnings were $0.30 a share, up 50.0% from $0.20. The company said the increase in net income was attributable to higher loan origination volume and that growth in diluted earnings per share was driven by higher net income alongside a lower diluted share count. Pretax income was $10.1 million.

Total operating expenses were $121.8 million. Interest expense comprised approximately 58% of those costs, a share the company said matched the prior-year periods. Net interest margin held at 5.1% of the average owned portfolio.

The owned loan portfolio reached a record $4.711 billion at the end of the third quarter, up 25.3% from $3.760 billion a year earlier. The company said that represented 21 consecutive quarters of portfolio growth. Average portfolio balance for the quarter was $4.576 billion.

Credit metrics improved against the year-ago quarter. Total delinquencies including repossession inventory were 12.29%, down from 13.96%. Annualized net charge-offs were 7.26% of the average portfolio, compared with 8.01%. Net recovery rates on repossessed collateral sold at wholesale auction rose to 32.0% from 28.7%.

The company said accelerating volume was driven by expanding the dealership base through strategic sales-force additions and enhancements that increased the speed and efficiency of contract underwriting and funding. Contracts securitized in the quarter were $734.5 million.

In the third quarter, Consumer Portfolio Services renewed one warehouse line of credit and increased its capacity to $508 million from $335 million, expanding that line by approximately 52%. The company said the added capacity gives it more credit to fund accelerating originations. It also closed its third asset-backed securitization of 2026, its 110th deal, which it described as the largest in its 35-year history and which primarily included second-quarter 2026 originations.