Synchrony Financial, a financial-services company based in Stamford, Conn., announced its second-quarter earnings, which fell short of expectations. Despite an increase in net interest income, the company’s provision for credit losses experienced a significant jump.
For the second quarter, Synchrony Financial reported a net income attributable to common shareholders of $559 million, or $1.32 per share. This is a decrease from the $793 million, or $1.60 per share, recorded during the same period last year. Analysts surveyed by FactSet had anticipated earnings of $1.26 per share.
Net Interest Income Growth
Synchrony Financial experienced an 8% rise in net interest income, reaching $4.12 billion. Additionally, the average active accounts saw a 1% increase from the previous year, totaling 69.5 million.
Provision for Credit Losses
The company’s provision for credit losses in the second quarter amounted to $1.38 billion. This represents a significant increase from both the year-ago period ($724 million) and the previous quarter ($1.29 billion).
Consumer Behavior Shifts Post-Pandemic
CEO Brian Doubles noted that consumer behavior is gradually returning to pre-pandemic patterns. He also highlighted the success of value-oriented offers across Synchrony Financial’s platforms.