- Key insight: The company's ability to attract quality borrowers is strong; it closes 50% more customers on average than competitors on leading loan comparison sites.
- Supporting data: LendingClub reported $44.3 million in net income, handily beating the $35.17 million consensus estimate from S&P Global analysts.
- Forward look: The company issued Q4 guidance for $2.5 to $2.6 billion in loan originations, which assumes two interest rate cuts in the fourth quarter.
Overview bullets generated by AI with editorial review
LendingClub exceeded analyst expectations in the third quarter, underscoring the growing earnings power and operational leverage of LendingClub's digital marketplace bank model.
LendingClub reported $44.3 million in net income and diluted earnings per share (EPS) of $0.37. This significantly outperformed analyst expectations, which had set the consensus mean for net income at $35.17 million and diluted EPS at $0.30.
Total net revenue of $266.23 million also surpassed the consensus mean of $256.01 million. These expectations are the mean of 11 analysts surveyed by S&P Global.
A key takeaway for banking institutions is LendingClub's continued success in leveraging its bank charter for resilient revenue generation. Net interest income reached an all-time record of $158 million in the third quarter.
One soft spot in the company's performance was in deposits, which fell $100 million from the year prior, down to $9.4 billion. The company said this decline was "mostly" offset by an increase in non-brokered, relationship deposits.
Balances in LendingClub's LevelUp savings accounts, which offer customers 5.30% APY when they deposit $250 per month (otherwise they get a rate of 4.80%), approached $3 billion.
LendingClub has available liquidity of $3.9 billion, which chief financial officer Drew LaBenne called "excess capital" that he said the company plans to use to grow its balance sheet as the company continues to ramp up loan originations.
A partnership with BlackRock
Earlier in the quarter, LendingClub secured a memorandum of understanding with funds and accounts managed by BlackRock to purchase up to $1 billion in loans through LendingClub's marketplace programs through 2026.
This agreement comes after BlackRock funds made a similar $100 million purchase in June 2025 under LendingClub's structured certificates program, LendingClub Rated Notes (shortened to LENDR).
Rated Notes is based on the company's structured certificate program, which is a two-tranche securitization in which LendingClub retains one tranche — the low-risk part of the bundle — and marketplace investors can purchase the high-risk parts.
LendingClub gets fee revenue and interest income while offloading risk to speculators, who benefit from more flexibility and efficiency than they would get from similar securities elsewhere.
The Rated Notes program builds on this by selling multiple tranches, each with a credit rating by rating agency Fitch.
Rated Notes is capturing strong interest, according to CEO Scott Sanborn's comments during the company's Wednesday earnings call, and is expected to further improve loan sales prices and boost marketplace revenue.
Furthermore, LaBenne said that prices achieved through rated transactions are "really approaching bank prices now." In other words, the company believes its securities prices are starting to compete with those of traditional banks.
Credit discipline and customer acquisition
LendingClub said it continues to emphasize disciplined underwriting, reporting a net charge-off ratio that modestly improved to 2.9%.
Sanborn noted that the company's ability to attract high-quality borrowers is evidenced by its performance against competitors.
"When our loan offers are made side by side on a leading loan comparison site, we close 50% more customers on average than the competition," Sanborn said Wednesday.
The investments in digital engagement are also paying off. Monthly app logins from borrowers are up nearly 50%, and the new LevelUp checking product is driving a seven-fold increase in account openings versus the prior checking product, with nearly 60% of new account holders also being borrowers.
Fourth quarter outlook
LendingClub issued guidance for Q4 2025 that shows management anticipating a sequential slowdown in profitability and stable origination volume compared to the third-quarter results.
The company issued guidance that loan originations, which were $1.8 billion in the fourth quarter last year, will grow to $2.5 billion to $2.6 billion in the fourth quarter of this year.
The guidance assumes two interest rate cuts in the fourth quarter. The company said it plans to provide additional guidance during an upcoming investor day on November 5.
