Synchrony Financial Profit Dips as Rising Costs Offset Credit Gains

Net interest income climbed 2% to $4.8 billion, aligning with analyst projections as higher interest and fee revenue helped offset reduced investment income. Purchase volume grew 8% to $49.7 billion, with the home-and-auto sector recording a 9% increase and the diversified value category jumping 13%. These gains were tempered by a 10% rise in operational expenses, which reached $1.4 billion due to increased technology spending, marketing, and operational losses.

The company’s credit profile shows signs of stabilization. Net charge-offs decreased to 4.79% from 5.16% a year ago, while the delinquency rate for accounts 30 or more days past due edged down to 4.3%. Though the provision for credit losses rose to $1.3 billion—largely due to a $30 million reserve build compared to a release in the previous year—the allowance for credit losses as a percentage of total receivables declined to 10%. Looking ahead, Synchrony raised its full-year 2026 earnings guidance to $9.50 per share, surpassing the current consensus estimate of $9.41.