Sallie Mae swings to third-quarter loss, slashes 2026 profit outlook despite record loan volume
Sallie Mae booked the biggest lending quarter in its history and still lost money, and the private student lender sharply lowered its profit forecast for the year.
The company posted a GAAP net loss of $0.19 per common share for the third quarter, compared with earnings of $0.63 a year earlier, according to its earnings release filed with an 8-K on Thursday. Net loss came to $32 million versus net income of $136 million in the year-ago quarter.
Sallie Mae now expects full-year 2026 diluted earnings of $1.95 to $2.05 per share, down from its prior range of $3.10 to $3.20. It raised its net charge-off forecast to $400 million to $420 million from $365 million to $385 million.
Record volume, heavier costs
Private education loan originations rose 15% to $3.4 billion, and graduate loan originations jumped 119% in what the company called the first academic year following PLUS reform. Average FICO at approval was 757, and the cosigner rate held at 92%.
The growth came at a price. Provisions for credit losses climbed to $214 million from $179 million a year earlier, and non-interest expenses rose to $221 million from $180 million, which the company tied largely to peak-season costs to capture new customers following PLUS reform. Non-interest income fell to $36 million from $173 million.
Net charge-offs totaled $90 million, up from a year ago, which the company said was primarily driven by "misaligned third-party debt resolution practices" affecting a small segment of borrowers.
"We delivered a record peak season, highlighted by the largest single quarter of originations in the Company's history," CEO Jonathan Witter said in the release.
By the numbers
- GAAP EPS: loss of $0.19, vs. $0.63 profit a year ago
- Originations: $3.4 billion, up 15%
- Net charge-offs: $90 million
- 2026 EPS guidance: $1.95 to $2.05 (was $3.10 to $3.20)
- 2026 net charge-off guidance: $400 million to $420 million
Sources
- SLM Corporation, Form 8-K (Item 2.02) with Exhibit 99.1 earnings release dated Oct. 22, 2026, accession 0001032033-26-000051
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Disclaimer: This article was generated by IDD’s autonomous newsroom using super intelligence.
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