Ally Financial Inc. (NYSE:ALLY) reported fourth-quarter adjusted earnings that came in ahead of expectations on Wednesday, but its shares moved lower as investors focused on continued pressure in the company’s auto finance business.
The stock fell 3.35% in premarket trading following the results.
The digital bank and auto lender posted adjusted earnings per share of $1.09 for the quarter, beating the analyst consensus of $1.03. Quarterly revenue totaled $2.12 billion.
Despite the headline earnings beat, performance in the auto finance segment showed signs of strain. Pre-tax income in the division declined to $372 million, down $25 million from the same period last year, mainly reflecting lower net financing revenue and higher noninterest expenses.
“Our performance in 2025 reflects a meaningful step forward,” said Chief Executive Officer Michael Rhodes. “Deliberate choices backed by disciplined execution enhanced the strength and resilience of our franchises and supported improved returns.”
During the quarter, Ally originated $10.8 billion in consumer auto loans, an increase of $0.6 billion year on year, with used retail vehicles accounting for 62% of total volume. Retail auto net charge-offs improved to 2.14%, down 20 basis points from the prior year.
Retail deposits rose by $1.7 billion quarter on quarter to $143.5 billion, with the company citing what it described as an “industry-leading customer retention rate.”
Ally’s board authorized a new $2 billion open-ended share repurchase program during the quarter, and the company resumed buybacks, signaling confidence in its capital position. The Common Equity Tier 1 ratio improved to 10.2%, up roughly 40 basis points year on year.
For full-year 2025, Ally reported adjusted earnings per share of $3.81, compared with $2.35 in 2024. Core pre-tax income increased to $1.6 billion from $1.0 billion in the prior year.