PROG Holdings Stock Surges as BNPL Division Drives Remarkable Turnaround

PROG Holdings has demonstrated a masterclass in strategic pivoting, delivering exceptional Q2 2025 results that far surpassed market expectations. The financial technology company successfully offset challenges in its core leasing operations with explosive growth from its emerging Buy Now, Pay Later platform.

Stellar Quarterly Performance

The company posted revenue of $604.7 million for the second quarter, significantly exceeding analyst projections of $589 million. Even more impressive was the bottom-line performance: adjusted earnings per share reached $1.02, beating estimates by a substantial 27.5 percent. This outstanding performance triggered a dramatic market response, with shares soaring over 20 percent on the announcement day.

Strategic Shift Bears Fruit

While the traditional Progressive Leasing segment experienced an 8.9 percent decline in merchandise volume, the company’s Four Technologies BNPL platform emerged as the clear growth engine. The division recorded a staggering 166.5 percent growth in gross merchandise value and achieved positive pre-tax earnings for the second consecutive quarter. This successful diversification strategy highlights management’s ability to identify and capitalize on new revenue streams.

Additional quarterly highlights included:
* Adjusted EBITDA of $73.5 million, representing a 12.2 percent margin
* Share repurchases totaling $25.7 million
* Raised full-year guidance for both revenue and profit

Should investors sell immediately? Or is it worth buying PROG Holdings?

Upgraded Outlook and Shareholder Returns

Bolstered by these robust results, management has revised its 2025 outlook upward. The company now anticipates full-year revenue between $2.45 billion and $2.5 billion, with adjusted EBITDA projected in the range of $255 million to $265 million. This upgraded guidance reflects executive confidence in the company’s strategic direction despite ongoing macroeconomic uncertainties.

Shareholders are receiving direct benefits through a quarterly dividend of $0.13 per share, already announced for September. The stock has shown signs of recovery after facing pressure earlier in the year, with investment bank Raymond James raising its price target from $36 to $40 in response to the strong quarterly performance.

The critical question moving forward is whether PROG Holdings can sustain the remarkable momentum of its BNPL division to effectively counterbalance the ongoing challenges in its traditional leasing business over the long term.