Ally Financial Inc (ALLY, Financial) released its Q3 2023 earnings on October 18, 2023, showcasing solid operating and financial results. The company reported a GAAP EPS of $0.88 and an Adjusted EPS of $0.83. The proactive expense management strategy implemented by the company is expected to drive an $80 million annual benefit through lower headcount. Additionally, the release of valuation allowance and state law change resulted in significant tax benefits within the quarter, amounting to a $94 million tax benefit.
Financial Highlights
Ally Financial Inc (ALLY, Financial) reported a GAAP total net revenue of $1.97 billion and an adjusted total net revenue of $2.04 billion. The company saw a record 3.7 million consumer auto applications, driving $10.6 billion of origination volume. The originated yield stood at 10.7% with over 40% of volume originated within the highest credit quality tier. The insurance earned premiums of $324 million marked the highest since 2009.
The company's total deposits increased by $7.1 billion year over year, reaching $153 billion with 3.0 million customers. The company also reported 1.2 million active credit cardholders and expects to complete the integration and launch of the OneAlly experience in the fourth quarter of 2023.
CEO Commentary
Jeffrey J. Brown, Chief Executive Officer of Ally Financial Inc (ALLY, Financial), commented on the results, stating
Ally reported solid operating and financial results in the third quarter which reflect our commitment to drive long-term value for all stakeholders. As we navigate a dynamic market backdrop, we remain focused on the controllables and have taken steps to prepare for a variety of operating environments."
Financial Tables Summary
The financial results table shows a decrease in GAAP Net Income Attributable to Common Shareholders from $301 million in Q2 2023 to $269 million in Q3 2023. The Core Net Income Attributable to Common Shareholders also decreased from $291 million in Q2 2023 to $252 million in Q3 2023. The GAAP Earnings per Common Share remained stable at $0.88, while the Adjusted EPS decreased from $0.96 in Q2 2023 to $0.83 in Q3 2023.
The company's GAAP Total Net Revenue decreased from $2,079 million in Q2 2023 to $1,968 million in Q3 2023. The Adjusted Total Net Revenue also saw a decrease from $2,066 million in Q2 2023 to $2,036 million in Q3 2023. The Pre-Provision Net Revenue decreased from $830 million in Q2 2023 to $736 million in Q3 2023, while the Core Pre-Provision Net Revenue increased from $817 million in Q2 2023 to $834 million in Q3 2023.
Conclusion
In conclusion, Ally Financial Inc (ALLY, Financial) has demonstrated strong performance in Q3 2023, driven by proactive expense management and significant tax benefits. The company's commitment to driving long-term value for all stakeholders is evident in its solid operating and financial results. With a record number of consumer auto applications and the highest insurance earned premiums since 2009, Ally Financial Inc (ALLY) continues to demonstrate the benefits of scale and strength it has built over the past decade.
