Key Highlights

  • Net income was $129.6 million, or $2.25 per diluted share, versus $112.4 million, or $1.94.
  • Net interest income rose to $331.3 million from $291.1 million.
  • Net interest Margin was 4.64%, compared with 4.75% a year earlier.
  • Provision for Credit losses was $24.5 million, up from $17.3 million.
  • Total non-interest income reached $63.8 million, almost double the $32.3 million a year ago.

Profit climbs 15% as net interest income grows

Axos Financial (NYSE:AX) is a technology-driven diversified financial services company with about $30.8 billion in Assets and about $48.0 billion of assets under custody or administration at its clearing unit. It offers banking, clearing and custody, and related services through its technology platforms.

In its quarterly filing for the three months ended September 30, 2026, the company reported Net Income of $129.6 million, or $2.25 per diluted share. That compares with $112.4 million, or $1.94 per diluted share, a year earlier, an increase of about 15% in net income on a calculated basis.

Net interest income rose to $331.3 million from $291.1 million, a calculated gain of about 14%, helped by a larger balance sheet. Average total assets were $30.2 billion against $25.4 billion a year earlier.

Margin narrows as funding costs shift

Net interest margin was 4.64%, down from 4.75%, and the Interest Rate spread was 3.91% versus 3.89%. The Yield on interest-earning assets fell to 7.24% from 7.60%, while the average rate paid on interest-bearing liabilities fell to 3.33% from 3.71%.

Average loans were $26.0 billion at a yield of 7.48%, compared with $21.5 billion at 7.99%. Purchased loans yielded 11.49%, down from 15.81%, on a smaller average balance of $595.6 million.

Funding changed in structure. Average Federal Home Loan Bank advances rose to $863.0 million from $60.0 million, and secured financings averaged $559.5 million versus $8.5 million. Interest-bearing Demand and savings deposits averaged $19.7 billion at 3.24%, compared with $17.2 billion at 3.68%.

Provisions rise and non-interest income doubles

The provision for credit losses was $24.5 million, up from $17.3 million, leaving net interest income after provisions at $306.8 million versus $273.8 million. Total non-interest income was $63.8 million versus $32.3 million.

The filing notes that results of Verdant, an acquired business, have been included in the consolidated results since September 30, 2025, so the prior-year quarter does not include Verdant earnings. That timing is one reason the year-over-year Balance Sheet and income comparisons show strong growth.

Interest-earning deposits at other institutions averaged $1.2 billion at 3.54%, against $2.5 billion at 4.44%, reflecting a shift of balance sheet resources into loans and securities. Mortgage-backed and other securities averaged $788.8 million, up from $61.1 million.

Balance sheet scale and what bank watchers will track

Total deposits were $25.4 billion at September 30, 2026, compared with $24.6 billion at the prior fiscal year-end of June 30, 2026. Stockholders' Equity averaged $3.3 billion for the quarter, up from $2.8 billion.

The company's results show Earnings growth outpacing the modest decline in margin, as balance sheet growth and higher fee income more than offset lower yields. Net interest margin has moved down by 11 basis points year over year.

Readers following the name will likely watch whether funding costs from advances and secured financings keep rising and whether provisioning continues at the $24.5 million quarterly level.