Axos Financial’s third quarter saw results that exceeded Wall Street’s expectations for both revenue and non-GAAP earnings per share, but the market responded negatively, with shares declining after the report. Management highlighted stable net interest margins, strong loan growth—particularly in fund finance and equipment leasing—and improvements in credit quality as primary drivers of the quarter. CEO Gregory Garrabrants noted, “We delivered solid results this quarter, generating over $700 million of net loan growth,” and emphasized disciplined expense management and the company’s ability to navigate a volatile rate and competitive environment. The team also cited progress in reducing nonaccrual loans and maintaining robust credit reserves.

Is now the time to buy AX? Find out in our full research report (it’s free for active Edge members).

While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.

Our Top 5 Analyst Questions From Axos Financial’s Q3 Earnings Call

• Kyle Peterson (Needham & Company) asked about areas of loan growth caution and competitive positioning. CEO Gregory Garrabrants explained that Axos is avoiding riskier logistics C&I segments and sees positive momentum in single-family loan pipelines as legacy headwinds abate.
• Andrew Liesch (Piper Sandler) questioned the sustainability of Axos’s efficiency ratio. Garrabrants emphasized that technology and AI-driven operating leverage should keep the ratio stable, with a target to limit personnel expense growth to 30% of combined income.
• Gary Tenner (D.A. Davidson) sought detail on credit improvements and allowance shifts. CFO Derrick Walsh attributed reserve changes to model-based economic inputs and highlighted that real estate portfolios remain strong, while C&I reserves increased due to loan growth and negative economic outlook factors.
• Kelly Motta (KBW) inquired about continued buybacks amid loan growth and capital deployment. Garrabrants said Axos sees value in incremental buybacks given its capital position and will remain prudent, also noting interest in wealth and custody M&A targets if priced appropriately.
• Edward Hemmelgarn (Shaker Investments) asked about conservative equity levels and technology spend. Garrabrants explained the company’s evolving risk mix and the rationale for higher equity, while detailing AI applications in software development, code documentation, and operational efficiency.

Catalysts in Upcoming Quarters

In the quarters ahead, the StockStory team will watch (1) Axos’s ability to maintain high-single-digit to low-teens loan growth as prepayment and origination dynamics shift, (2) progress in deposit mix optimization and cost control amid rising competition for funding, and (3) measurable results from investments in artificial intelligence and digital platform modernization. Execution on these priorities, along with management of credit quality and regulatory risks, will be critical signposts.

Axos Financial currently trades at $80.75, up from $79.11 just before the earnings. At this price, is it a buy or sell? Find out in our full research report (it’s free for active Edge members).

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