Several key measures of Live Oak Bancshares’ third-quarter operations show slight improvement over those of the previous quarter. The company, parent of Live Oak Bank, reported its Q3 2024 earnings after the market close on Wednesday.
 
Total revenue for the quarter ending Sept. 30 was nearly $130 million, a quarter-over-quarter increase of about $4.5 million and roughly $2.6 million more than revenue in Q3 2023. The company originated more loans and leases during the quarter just ended than in either the previous quarter or the same quarter of 2023: $1.75 billion, compared with nearly $1.2 billion in Q2 and under $1.1 billion at the end of Q3 2023.
 
“As of September 30, 2024, the total loan and lease portfolio was $10.19 billion, 6.9% above its level at June 30, 2024, and 16.1% above its level a year ago,” Live Oak’s earnings news release stated. “Excluding historical Paycheck Protection Program loans, the third quarter of 2024 was the Company’s highest loan production quarter of all time.”
 
Live Oak, which has actively pursued new deposits in recent months, had results to show for its efforts: total deposits at the end of Q3 were $11.4 billion, up from last quarter’s $10.7 billion. Year over year, deposits grew almost $1.4 billion.
 
The weak spot in Live Oak’s earnings report was its net income, which totaled just over $13 million in Q3, down from last quarter’s total of nearly $27 million and Q3 2023’s total of nearly $40 million. The income downturn resulted in an earnings-per-share rate of $0.28, down significantly from that of $0.88 a year ago.

This decline was driven primarily by the bank's increased provisions for credit losses, which rose to $34.5 million in response to expectations of rising credit risk. That figure is almost three times the credit loss provision in Q2 and more than triple that of the third quarter of 2023. Live Oak's bottom line was further affected by a $4.2 million loss due to loan servicing asset revaluation.
 
Company officials pointed to the positive key indicators.
 
“Live Oak delivered historic production levels this quarter as our teams continue to put capital into the hands of business owners across the country,” Live Oak Chairman and Chief Executive Officer James “Chip” Mahan stated in the news release. “We believe our business momentum is in an exciting place and our conservative approach to growth is driving positive operating leverage, revenue, and deeper customer relationships.”
 
Zacks Equity Research had expected Live Oak’s quarterly revenue to be slightly less, at $126.6 million. The analysts, however, had anticipated a higher EPS of $0.53, so the quarter’s $0.28 earnings per share was a “surprise,” the firm stated in an earnings analysis published Wednesday.

Financial services company The Motley Fool summarized Live Oak's Q3 earnings report Thursday.

"The results showcased a dynamic quarter with strong loan production and deposit growth, though earnings missed expectations. The company reported earnings per share (EPS) of $0.28, falling short of the estimated $0.55, a noticeable 49% miss. In contrast, total revenue exceeded expectations, reaching $129.93 million compared to the expected $127.83 million.

As of 3:15 p.m. Thursday, Live Oak's shares on Nasdaq were trading at $42.52, down slightly from their Thursday starting price of $44.12.