Upbound Group (NASDAQ:UPBD) executives said 2025 marked “significant progress” in the company’s transformation toward a more digital and data-driven platform, highlighting record revenue, the full-year integration of newly acquired Brigit, and continued investment in technology and underwriting discipline as key themes on the company’s fourth-quarter earnings call.
2025 highlights and strategic priorities
CEO Fahmi Karam, who assumed the role in June after serving as CFO, said the company served more than 3.5 million customers across its brands in 2025 and expanded its business by adding Brigit, a subscription-based financial health technology company acquired in January 2025. Karam also highlighted leadership additions, including new CFO Hal Khouri and newly created Chief Growth Officer role filled by Rebecca Wooters, who will lead digital transformation initiatives across the company’s major segments.
Full-year and Q4 financial performance
Karam said the company’s full-year results exceeded the midpoint of the figures provided on its third-quarter call. For 2025, Upbound reported:
- Revenue growth of 8.7% to approximately $4.7 billion, which management described as the highest full-year revenue on record for the company.
- Adjusted EBITDA of nearly $510 million, up 7.5% from the prior year.
- Non-GAAP diluted EPS of $4.13, up from $3.83 in 2024.
- Free cash flow of $180 million, up more than $130 million year-over-year, and net cash provided by operating activities of approximately $306 million, which management said was aided in part by tax depreciation benefits.
For the fourth quarter, Upbound reported revenue of $1.2 billion, up 10.9% year-over-year, driven primarily by the addition of Brigit and 8.6% revenue growth at Acima. Adjusted EBITDA was $126 million, up 2.6% year-over-year, while adjusted EBITDA margin declined 90 basis points to 10.5%. Non-GAAP diluted EPS was $1.01, down 4% from the year-ago quarter.
Management repeatedly pointed to ongoing pressure on its core consumer, citing the cumulative effects of inflation and elevated costs for essentials, while also emphasizing that the company tightened underwriting and made targeted risk management adjustments as conditions evolved.
Segment performance: Acima, Brigit, and Rent-A-Center
Acima posted its ninth consecutive quarter of revenue growth, with revenue up 8.6% year-over-year in Q4. Khouri said Q4 GMV was nearly $550 million, the highest since Upbound added Acima five years ago, and noted the performance of Acima’s direct-to-consumer marketplace as a driver. The marketplace’s GMV grew more than 100% year-over-year in 2025 and accounted for nearly 10% of Acima GMV by year-end.
Acima’s adjusted EBITDA was $87 million in Q4, up 7.3% year-over-year. Loss rate was 10.1% in Q4, up 110 basis points year-over-year. Khouri said elevated losses reflected challenging vintages underwritten earlier in 2025, but pointed to early payment and delinquency trends as indicators that underwriting adjustments should drive improvement.
Brigit ended Q4 with approximately 1.6 million paid subscribers, up nearly 30% from the prior year and up 7.4% sequentially. Monthly ARPU was $14.15, up nearly 10% year-over-year. Brigit originated approximately $405 million in cash advances during Q4, up 19% year-over-year. Revenue for the quarter was $64.6 million, up 41.5% year-over-year, with subscriptions representing 68% of revenue. Adjusted EBITDA was $11.1 million, for an adjusted EBITDA margin of 17.2%, up 110 basis points sequentially. Brigit’s instant cash loss rate was 3.5%, up 70 basis points year-over-year, which management attributed primarily to expansion into new profitable user segments and ongoing consumer pressure.
Karam said Brigit’s three priorities in 2025 were maintaining growth, launching new products, and cross-marketing with Acima and Rent-A-Center. He said Brigit piloted a line of credit product late in 2025 that offers qualified customers up to $500, and management is planning a broader rollout in 2026. Executives also described cross-selling initiatives, including targeted email campaigns and in-store promotional materials.
Rent-A-Center posted year-over-year same-store sales growth of 80 basis points in Q4, which management said was the first positive same-store sales quarter since 2024. Q4 revenue was nearly $480 million, flat year-over-year. Loss rate was 4.9%, down 10 basis points year-over-year and in line with prior guidance. Adjusted EBITDA was $69.2 million, down about 13% year-over-year, with margin of 14.4%, which Khouri attributed primarily to certain expense benefits in the prior year period. Management said 2025 represented a year of stabilization for the segment, after tighter underwriting and product category limits implemented in late 2024 weighed on early-2025 results.
Capital allocation, balance sheet, and legal matters
Khouri said Upbound generated improved free cash flow in 2025 after 2024 levels were pressured by working capital needs tied to Acima’s growth. The company ended 2025 with $358 million of liquidity between cash and revolver availability, improving from the end of Q1 after the Brigit acquisition reduced availability. He said the company refinanced its Term Loan B in Q3, which helped liquidity by year-end.
Management reiterated capital allocation priorities:
- Reinvesting in the business and funding organic growth
- Deleveraging the balance sheet
- Supporting shareholder dividend distributions
- Considering opportunistic share buybacks depending on market conditions and constraints
Khouri said the company is currently prioritizing leverage reduction over share repurchases, while remaining open to opportunistic buybacks. Net leverage ended the year at approximately 2.9x, up from 2.7x the prior year due to the Brigit acquisition, and management said it is targeting leverage in the 2x range over the long term.
On legal and regulatory matters, Khouri said the company’s estimated legal accrual at year-end 2025 was $72 million. He said the McBurnie class action is awaiting final court approval on a settlement, and that the multistate attorneys general matter that has been ongoing since 2021 is nearing a non-binding agreement in principle on primary monetary and injunctive terms, though a final binding settlement cannot be assured.
2026 outlook and Q1 guidance
For 2026, management guided for consolidated revenue of $4.7 billion to $4.95 billion, adjusted EBITDA of $500 million to $535 million, and non-GAAP diluted EPS of $4.00 to $4.35. Corporate costs were expected to be about 4% of revenue, with a tax rate in the 26% range and an average diluted share count of approximately 59.4 million shares.
Segment commentary included expectations that Acima GMV and revenue will increase mid-single digits year-over-year, with adjusted EBITDA margins in line with 2025 and losses stabilizing around 9.5% for the year. Brigit was guided to revenue of $265 million to $285 million and adjusted EBITDA of $50 million to $60 million; management said these figures trail initial acquisition estimates due to extended timelines for launching new products and the need for underwriting and product iteration in a challenging macro environment. Rent-A-Center was expected to have flat to positive revenue versus 2025, with adjusted EBITDA margins in line with 2025.
Upbound guided to 2026 free cash flow of approximately $200 million, including an expected cash flow benefit of around $100 million from accelerated tax depreciation, and inclusive of $72 million in settlement-related payment outflows.
For Q1, the company guided to revenue of $1.16 billion to $1.26 billion, adjusted EBITDA of $120 million to $130 million, and non-GAAP EPS of $1.05 to $1.15. Management also discussed seasonality, noting Q1 is typically stronger, and addressed tax season uncertainty while stating its guidance assumes a “normalized” tax season.
About Upbound Group (NASDAQ:UPBD)
Upbound Group, Inc leases household durable goods to customers on a lease-to-own basis in the United States, Puerto Rico, and Mexico. It operates through four segments: Rent-A-Center, Acima, Mexico, and Franchising. The company's brands, such as Rent-A-Center and Acima that facilitate consumer transactions across a range of store-based and virtual channels. It offers furniture comprising mattresses, tires, consumer electronics, appliances, tools, handbags, computers, smartphones, and accessories.
