Upbound Group, Inc. (NASDAQ:UPBD) Q2 2023 Earnings Conference Call August 3, 2023 9:00 AM ET

Company Participants

Brendan Metrano - Head of Investor Relations

Mitchell Fadel - Chief Executive Officer

Fahmi Karam - Executive Vice President and Chief Financial Officer

Conference Call Participants

Robert Griffin - Raymond James

Kyle Joseph - Jefferies LLC

Anthony Chukumba - Loop Capital Markets LLC

Bradley Thomas - KeyBanc Capital Markets

Alex Fuhrman - Craig-Hallum Capital Group

Operator

Good day, and thank you for standing by. Welcome to the Upbound Group, Inc's Second Quarter Earnings Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded.

I would now like to turn the call over to Brendan Metrano, Head of Investor Relations.

Brendan Metrano

Good morning, and thank you all for joining us to discuss the Company's results for the second quarter of 2023. We issued our earnings release before the market opened today. And the release and all related materials, including a link to the live webcast, are available on our website at investor.upbound.com.

On the call today from Upbound Group, we have Mitch Fadel, our CEO, and Fahmi Karam, our CFO. As a reminder, some of the statements provided on this call are forward-looking and are subject to factors that could cause actual results to differ materially from our expectations. These factors are described in our earnings release as well as in the Company's SEC filings. Upbound Group undertakes no obligation to publicly update or revise any forward-looking statements except as required by law.

This call will also include references to non-GAAP financial measures, and our discussion of comparable performance will generally refer to non-GAAP results. Please refer to our second quarter earnings release, which can be found on our website for a description of the non-GAAP financial measures and the reconciliations to the most comparable GAAP financial measures.

With that, I will turn the call over to Mitch.

Mitchell Fadel

Thank you, Brendan, and good morning, everyone, on the call today. Second quarter results exceeded our internal expectations again this quarter with revenue of $979 million at the high-end of our expectations, while adjusted EBITDA of $130.6 million and non-GAAP earnings per share of $1.11 were above expectations. Similar to the first quarter, earnings upside was primarily attributable to effective underwriting execution and strong gross margin for the Acima segment, driven primarily by fewer customers electing the earliest lease payout option. Now, Fahmi will provide additional context on this in a few minutes with his discussion of our financial results and our outlook.