Axos Financial (NYSE:AX) Delivers Strong Q4 CY2025 Numbers

As the Q3 earnings season wraps, let’s dig into this quarter’s best and worst performers in the regional banks industry, including Regions Financial and its peers.

Regional banks, financial institutions operating within specific geographic areas, serve as intermediaries between local depositors and borrowers. They benefit from rising interest rates that improve net interest margins (the difference between loan yields and deposit costs), digital transformation reducing operational expenses, and local economic growth driving loan demand. However, these banks face headwinds from fintech competition, deposit outflows to higher-yielding alternatives, credit deterioration (increasing loan defaults) during economic slowdowns, and regulatory compliance costs. Recent concerns about regional bank stability following high-profile failures and significant commercial real estate exposure present additional challenges.

The 101 regional banks stocks we track reported a satisfactory Q3. As a group, revenues beat analysts’ consensus estimates by 1.3%.

Thankfully, share prices of the companies have been resilient as they are up 9.2% on average since the latest earnings results.

Regions Financial

Tracing its roots back to 1971 and operating in a region known as the "heart of Dixie," Regions Financial is a financial holding company that provides banking services, wealth management, and specialty financial solutions across the South, Midwest, and Texas.

Regions Financial reported revenues of $1.95 billion, up 3.9% year on year. This print exceeded analysts’ expectations by 1.2%. Despite the top-line beat, it was still a mixed quarter for the company with a narrow beat of analysts’ tangible book value per share estimates but a slight miss of analysts’ net interest income estimates.

Interestingly, the stock is up 22.7% since reporting and currently trades at $28.65.

Best Q3: Customers Bancorp

Originally founded with a "high-tech, high-touch" branch-light banking strategy, Customers Bancorp is a bank holding company that provides commercial and consumer banking services through its Customers Bank subsidiary, with a focus on business lending and digital banking.

Customers Bancorp reported revenues of $231.8 million, up 38.3% year on year, outperforming analysts’ expectations by 6.9%. The business had a stunning quarter with an impressive beat of analysts’ net interest income estimates and a solid beat of analysts’ revenue estimates.

The market seems happy with the results as the stock is up 17.8% since reporting. It currently trades at $77.19.

Weakest Q3: The Bancorp

Operating behind the scenes of many popular fintech apps and prepaid cards you might use daily, The Bancorp is a bank holding company that specializes in providing banking services to fintech companies and offering specialty lending products.

The Bancorp reported revenues of $174.7 million, up 38.8% year on year, falling short of analysts’ expectations by 9.9%. It was a disappointing quarter as it posted a significant miss of analysts’ revenue and net interest income estimates.

The Bancorp delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 9.8% since the results and currently trades at $69.64.

Read our full analysis of The Bancorp’s results here.

Axos Financial

Originally founded as Bank of Internet USA in 1999 before rebranding in 2018, Axos Financial is a diversified financial services company that provides digital banking, securities clearing, and investment advisory solutions to retail and business customers nationwide.

Axos Financial reported revenues of $323.4 million, flat year on year. This print topped analysts’ expectations by 1.4%. More broadly, it was a satisfactory quarter as it also logged a beat of analysts’ EPS estimates but a slight miss of analysts’ tangible book value per share estimates.

The stock is up 14.2% since reporting and currently trades at $90.58.

Read our full, actionable report on Axos Financial here, it’s free for active Edge members.

First Financial Bancorp

Tracing its roots back to 1863 during the Civil War era, First Financial Bancorp is a bank holding company that provides commercial banking, lending, deposit services, and wealth management to individuals and businesses.

First Financial Bancorp reported revenues of $234.4 million, up 9.3% year on year. This result beat analysts’ expectations by 2.7%. Aside from that, it was a mixed quarter as it also recorded an impressive beat of analysts’ tangible book value per share estimates but a narrow beat of analysts’ EPS estimates.

The stock is up 5.1% since reporting and currently trades at $25.55.

Read our full, actionable report on First Financial Bancorp here, it’s free for active Edge members.

What Happened?

A number of stocks jumped in the afternoon session after comments from a key Federal Reserve official boosted hopes for an interest rate cut. New York Federal Reserve President John Williams stated he sees “room for a further adjustment” in the near term, sparking a significant market rally. Following his remarks, the probability of the central bank cutting rates at its December meeting jumped from 39% to over 73%, according to the CME FedWatch tool. This positive sentiment provided relief to markets amid concerns over high valuations, particularly in AI-related stocks.

The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.

Among others, the following stocks were impacted:

• Regional Banks company East West Bank jumped 4.1%. Is now the time to buy East West Bank? Access our full analysis report here, it’s free for active Edge members.
• Regional Banks company Columbia Banking System jumped 4.1%. Is now the time to buy Columbia Banking System? Access our full analysis report here, it’s free for active Edge members.
• Regional Banks company Cathay General Bancorp jumped 4.1%. Is now the time to buy Cathay General Bancorp? Access our full analysis report here, it’s free for active Edge members.
• Regional Banks company BankUnited jumped 4%. Is now the time to buy BankUnited? Access our full analysis report here, it’s free for active Edge members.
• Regional Banks company Axos Financial jumped 4.1%. Is now the time to buy Axos Financial? Access our full analysis report here, it’s free for active Edge members.

Zooming In On Cathay General Bancorp (CATY)

Cathay General Bancorp’s shares are not very volatile and have only had 9 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.

The biggest move we wrote about over the last year was about 1 month ago when the stock dropped 6.2% on the news that disclosures from two lenders raised concerns about deteriorating loan quality across the industry. The drop was triggered by specific incidents that have spooked investors. Zions Bancorp announced a $50 million charge-off—a debt the bank doesn't expect to collect—on a single loan. Separately, Western Alliance Bancorp revealed it was dealing with a borrower who had failed to provide proper collateral. These events are compounding existing anxieties about the regional banking sector, which is already under pressure from elevated interest rates and declining commercial real estate values. The news heightened investor concerns that more cracks could appear in borrowers' creditworthiness, potentially leading to increased loan losses and reduced profitability for other banks in the sector.

Cathay General Bancorp is up 1.5% since the beginning of the year, but at $47.81 per share, it is still trading 11.2% below its 52-week high of $53.85 from November 2024. Investors who bought $1,000 worth of Cathay General Bancorp’s shares 5 years ago would now be looking at an investment worth $1,637.

Let’s dig into the relative performance of Trustmark and its peers as we unravel the now-completed Q3 regional banks earnings season.

Regional banks, financial institutions operating within specific geographic areas, serve as intermediaries between local depositors and borrowers. They benefit from rising interest rates that improve net interest margins (the difference between loan yields and deposit costs), digital transformation reducing operational expenses, and local economic growth driving loan demand. However, these banks face headwinds from fintech competition, deposit outflows to higher-yielding alternatives, credit deterioration (increasing loan defaults) during economic slowdowns, and regulatory compliance costs. Recent concerns about regional bank stability following high-profile failures and significant commercial real estate exposure present additional challenges.

The 94 regional banks stocks we track reported a satisfactory Q3. As a group, revenues missed analysts’ consensus estimates by 1.1%.

In light of this news, share prices of the companies have held steady. On average, they are relatively unchanged since the latest earnings results.

Trustmark

Tracing its roots back to 1889 in Mississippi, Trustmark is a financial services organization providing banking, wealth management, insurance, and mortgage services across five southeastern states.

Trustmark reported revenues of $202.4 million, up 5.3% year on year. This print exceeded analysts’ expectations by 0.7%. Despite the top-line beat, it was still a mixed quarter for the company with a narrow beat of analysts’ revenue estimates but EPS in line with analysts’ estimates.

Duane A. Dewey, President and CEO, stated, “Our momentum continues to build as reflected in Trustmark’s solid financial performance in the third quarter. Diversified loan growth and stable credit quality continued along with cost-effective core deposit growth. Our wealth management business performed well while our mortgage business continued to execute well in a challenging operating environment. We continued to implement organic growth initiatives and make investments to capitalize on opportunities in our marketplace. During the quarter, we added established relationship managers and production talent to accelerate profitable growth in key markets across our franchise. We will continue to add seasoned professionals with proven performance records to supplement our teams and expand and deepen customer relationships. These investments are designed to further enhance our financial performance and create long-term value for our shareholders.”

Unsurprisingly, the stock is down 2.6% since reporting and currently trades at $37.62.

Is now the time to buy Trustmark? Access our full analysis of the earnings results here, it’s free for active Edge members.

Best Q3: Customers Bancorp

Originally founded with a "high-tech, high-touch" branch-light banking strategy, Customers Bancorp is a bank holding company that provides commercial and consumer banking services through its Customers Bank subsidiary, with a focus on business lending and digital banking.

Customers Bancorp reported revenues of $232.1 million, up 38.5% year on year, outperforming analysts’ expectations by 7%. The business had a stunning quarter with an impressive beat of analysts’ net interest income estimates and a solid beat of analysts’ revenue estimates.

The market seems content with the results as the stock is up 4.4% since reporting. It currently trades at $68.45.

Is now the time to buy Customers Bancorp? Access our full analysis of the earnings results here, it’s free for active Edge members.

Weakest Q3: The Bancorp

Operating behind the scenes of many popular fintech apps and prepaid cards you might use daily, The Bancorp is a bank holding company that specializes in providing banking services to fintech companies and offering specialty lending products.

The Bancorp reported revenues of $174.6 million, up 38.8% year on year, falling short of analysts’ expectations by 10%. It was a disappointing quarter as it posted a significant miss of analysts’ revenue estimates and a significant miss of analysts’ net interest income estimates.

As expected, the stock is down 19.3% since the results and currently trades at $62.15.

Read our full analysis of The Bancorp’s results here.

F.N.B. Corporation

Tracing its roots back to 1864 during the Civil War era, F.N.B. Corporation is a diversified financial services holding company that provides banking, wealth management, and insurance services to consumers and businesses across seven states and Washington, D.C.

F.N.B. Corporation reported revenues of $457.4 million, up 10.8% year on year. This result surpassed analysts’ expectations by 2.7%. It was a strong quarter as it also produced a solid beat of analysts’ revenue estimates and a beat of analysts’ EPS estimates.

The stock is up 10% since reporting and currently trades at $16.12.

Read our full, actionable report on F.N.B. Corporation here, it’s free for active Edge members.

Axos Financial

Originally founded as Bank of Internet USA in 1999 before rebranding in 2018, Axos Financial is a diversified financial services company that provides digital banking, securities clearing, and investment advisory solutions to retail and business customers nationwide.

Axos Financial reported revenues of $323.4 million, flat year on year. This number beat analysts’ expectations by 1.4%. Zooming out, it was a satisfactory quarter as it also produced a beat of analysts’ EPS estimates but a slight miss of analysts’ tangible book value per share estimates.

The stock is up 3.6% since reporting and currently trades at $81.94.

Read our full, actionable report on Axos Financial here, it’s free for active Edge members.

Market Update

In response to the Fed’s rate hikes in 2022 and 2023, inflation has been gradually trending down from its post-pandemic peak, trending closer to the Fed’s 2% target. Despite higher borrowing costs, the economy has avoided flashing recessionary signals. This is the much-desired soft landing that many investors hoped for. The recent rate cuts (0.5% in September and 0.25% in November 2024) have bolstered the stock market, making 2024 a strong year for equities. Donald Trump’s presidential win in November sparked additional market gains, sending indices to record highs in the days following his victory. However, debates continue over possible tariffs and corporate tax adjustments, raising questions about economic stability in 2025.

Let’s dig into the relative performance of First Financial Bancorp and its peers as we unravel the now-completed Q3 regional banks earnings season.

Regional banks, financial institutions operating within specific geographic areas, serve as intermediaries between local depositors and borrowers. They benefit from rising interest rates that improve net interest margins (the difference between loan yields and deposit costs), digital transformation reducing operational expenses, and local economic growth driving loan demand. However, these banks face headwinds from fintech competition, deposit outflows to higher-yielding alternatives, credit deterioration (increasing loan defaults) during economic slowdowns, and regulatory compliance costs. Recent concerns about regional bank stability following high-profile failures and significant commercial real estate exposure present additional challenges.

The 94 regional banks stocks we track reported a satisfactory Q3. As a group, revenues missed analysts’ consensus estimates by 1.1%.

In light of this news, share prices of the companies have held steady. On average, they are relatively unchanged since the latest earnings results.

First Financial Bancorp

Tracing its roots back to 1863 during the Civil War era, First Financial Bancorp is a bank holding company that provides commercial banking, lending, deposit services, and wealth management to individuals and businesses.

First Financial Bancorp reported revenues of $234 million, up 16.3% year on year. This print exceeded analysts’ expectations by 2.5%. Despite the top-line beat, it was still a mixed quarter for the company with a solid beat of analysts’ revenue estimates but a narrow beat of analysts’ EPS estimates.

Archie Brown, President and CEO, commented on third quarter results, "The third quarter of 2025 was another outstanding quarter for First Financial. Adjusted(1) net income was $72.6 million and adjusted(1) earnings per share were $0.76, which resulted in an adjusted(1) return on assets of 1.55% and an adjusted(1) return on tangible common equity of 19.3%."

Unsurprisingly, the stock is down 2.6% since reporting and currently trades at $23.65.

Is now the time to buy First Financial Bancorp? Access our full analysis of the earnings results here, it’s free for active Edge members.

Best Q3: Customers Bancorp

Originally founded with a "high-tech, high-touch" branch-light banking strategy, Customers Bancorp is a bank holding company that provides commercial and consumer banking services through its Customers Bank subsidiary, with a focus on business lending and digital banking.

Customers Bancorp reported revenues of $232.1 million, up 38.5% year on year, outperforming analysts’ expectations by 7%. The business had a stunning quarter with an impressive beat of analysts’ net interest income estimates and a solid beat of analysts’ revenue estimates.

The market seems content with the results as the stock is up 2.2% since reporting. It currently trades at $66.99.

Is now the time to buy Customers Bancorp? Access our full analysis of the earnings results here, it’s free for active Edge members.

Weakest Q3: The Bancorp

Operating behind the scenes of many popular fintech apps and prepaid cards you might use daily, The Bancorp is a bank holding company that specializes in providing banking services to fintech companies and offering specialty lending products.

The Bancorp reported revenues of $174.6 million, up 38.8% year on year, falling short of analysts’ expectations by 10%. It was a disappointing quarter as it posted a significant miss of analysts’ revenue and net interest income estimates.

As expected, the stock is down 20% since the results and currently trades at $61.62.

Read our full analysis of The Bancorp’s results here.

Axos Financial

Originally founded as Bank of Internet USA in 1999 before rebranding in 2018, Axos Financial is a diversified financial services company that provides digital banking, securities clearing, and investment advisory solutions to retail and business customers nationwide.

Axos Financial reported revenues of $323.4 million, flat year on year. This number topped analysts’ expectations by 1.4%. Taking a step back, it was a satisfactory quarter as it also logged a beat of analysts’ EPS estimates but a slight miss of analysts’ tangible book value per share estimates.

The stock is flat since reporting and currently trades at $79.62.

Read our full, actionable report on Axos Financial here, it’s free for active Edge members.

QCR Holdings

With roots dating back to 1993 and a name reflecting its original Quad Cities market, QCR Holdings (NASDAQGM:QCRH) operates four community banks across Iowa and Missouri, providing commercial, consumer banking, and trust services to businesses and individuals.

QCR Holdings reported revenues of $101.5 million, up 4.3% year on year. This print surpassed analysts’ expectations by 11.8%. It was an exceptional quarter as it also put up a beat of analysts’ EPS estimates and an impressive beat of analysts’ revenue estimates.

The stock is up 6.8% since reporting and currently trades at $76.28.

Read our full, actionable report on QCR Holdings here, it’s free for active Edge members.

Market Update

The Fed’s interest rate hikes throughout 2022 and 2023 have successfully cooled post-pandemic inflation, bringing it closer to the 2% target. Inflationary pressures have eased without tipping the economy into a recession, suggesting a soft landing. This stability, paired with recent rate cuts (0.5% in September 2024 and 0.25% in November 2024), fueled a strong year for the stock market in 2024. The markets surged further after Donald Trump’s presidential victory in November, with major indices reaching record highs in the days following the election. Still, questions remain about the direction of economic policy, as potential tariffs and corporate tax changes add uncertainty for 2025.

Axos Financial’s third quarter saw results that exceeded Wall Street’s expectations for both revenue and non-GAAP earnings per share, but the market responded negatively, with shares declining after the report. Management highlighted stable net interest margins, strong loan growth—particularly in fund finance and equipment leasing—and improvements in credit quality as primary drivers of the quarter. CEO Gregory Garrabrants noted, “We delivered solid results this quarter, generating over $700 million of net loan growth,” and emphasized disciplined expense management and the company’s ability to navigate a volatile rate and competitive environment. The team also cited progress in reducing nonaccrual loans and maintaining robust credit reserves.

Is now the time to buy AX? Find out in our full research report (it’s free for active Edge members).

Axos Financial (AX) Q3 CY2025 Highlights:

• Revenue: $323.4 million vs analyst estimates of $319.1 million (flat year on year, 1.4% beat)
• Adjusted EPS: $2.07 vs analyst estimates of $1.88 (10.3% beat)
• Adjusted Operating Income: $149.9 million vs analyst estimates of $164.5 million (46.3% margin, 8.9% miss)
• Market Capitalization: $4.57 billion

While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.

Our Top 5 Analyst Questions From Axos Financial’s Q3 Earnings Call

• Kyle Peterson (Needham & Company) asked about areas of loan growth caution and competitive positioning. CEO Gregory Garrabrants explained that Axos is avoiding riskier logistics C&I segments and sees positive momentum in single-family loan pipelines as legacy headwinds abate.
• Andrew Liesch (Piper Sandler) questioned the sustainability of Axos’s efficiency ratio. Garrabrants emphasized that technology and AI-driven operating leverage should keep the ratio stable, with a target to limit personnel expense growth to 30% of combined income.
• Gary Tenner (D.A. Davidson) sought detail on credit improvements and allowance shifts. CFO Derrick Walsh attributed reserve changes to model-based economic inputs and highlighted that real estate portfolios remain strong, while C&I reserves increased due to loan growth and negative economic outlook factors.
• Kelly Motta (KBW) inquired about continued buybacks amid loan growth and capital deployment. Garrabrants said Axos sees value in incremental buybacks given its capital position and will remain prudent, also noting interest in wealth and custody M&A targets if priced appropriately.
• Edward Hemmelgarn (Shaker Investments) asked about conservative equity levels and technology spend. Garrabrants explained the company’s evolving risk mix and the rationale for higher equity, while detailing AI applications in software development, code documentation, and operational efficiency.

Catalysts in Upcoming Quarters

In the quarters ahead, the StockStory team will watch (1) Axos’s ability to maintain high-single-digit to low-teens loan growth as prepayment and origination dynamics shift, (2) progress in deposit mix optimization and cost control amid rising competition for funding, and (3) measurable results from investments in artificial intelligence and digital platform modernization. Execution on these priorities, along with management of credit quality and regulatory risks, will be critical signposts.

Axos Financial currently trades at $80.75, up from $79.11 just before the earnings. At this price, is it a buy or sell? Find out in our full research report (it’s free for active Edge members).

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