EZPW Q4 2025: Jewelry PLO Hits 68%, Unlocking Margin and Digital Leverage
EZPW’s Q4 capped a transformative year as jewelry-backed pawn loans reached 68% of US PLO, amplifying margin gains and operational leverage amid robust digital and omnichannel expansion. Latin America momentum and disciplined M&A signal continued scale opportunities, while management flags a normalization of scrap profit as gold prices stabilize. Investors should focus on the company’s ability to translate digital initiatives and inventory mix into sustained profit growth in FY26.
Summary
- Jewelry Mix Drives Margin Expansion: Shift to 68% jewelry PLO in US underpins segment profitability and gold price leverage.
- Latin America Accelerates Store and PLO Growth: Rapid expansion and improved lending discipline create balanced, scalable growth runway.
- Digital and Loyalty Programs Gain Traction: Omnichannel engagement and 6.9M Easy Plus Rewards members reinforce repeat business and operational efficiency.
Performance Analysis
EZPW delivered record revenue and profit in Q4 2025, closing out a year defined by operational discipline and strategic balance sheet deployment. Total revenue reached $1.3 billion for the year, with adjusted EBITDA up 26% and net income up 30%. The US pawn segment remains the core, contributing 13% revenue growth in Q4, with about half of this lift coming from elevated scrap sales fueled by higher gold prices and increased jewelry purchases. Segment EBITDA margins expanded as management capitalized on the shift toward jewelry-backed loans and disciplined expense management.
Latin America is emerging as a significant growth lever, with 17% revenue and PLO growth in the quarter and a rapid buildout of de novo and acquired stores, especially in Mexico. Inventory growth outpaced PLO in the US, driven by more jewelry and longer layaways, but management views this as an opportunity to improve turns and drive future sales through targeted incentives and talent investment. Digital transformation is reshaping engagement, with online payments, omnichannel inventory access, and instant quote tools all showing strong adoption and contributing to both efficiency and customer loyalty.
- Jewelry-Driven PLO Growth: US PLO composition shifted to 68% jewelry, up 220 basis points, supporting margin gains and gold-linked upside.
- Latin America Store Expansion: 24 new stores in Q4, with robust momentum in Mexico, Guatemala, and Honduras, and a pipeline for further acquisitions.
- Digital Initiatives Fuel Efficiency: Online payments up 42% YoY in the US, with 49% increase in website traffic and omnichannel inventory now live across all stores.
Management’s focus on operational excellence, digital engagement, and disciplined capital allocation has positioned EZPW to sustain profitable growth, though normalization of scrap profit and inventory turns will be key watchpoints in FY26.
Executive Commentary
"Fiscal 2025 was a transformative year for EZ Corp. Outstanding operating and financial results on the top and bottom line drive exceptional shareholder value creation. We materially grew the store base across the five countries in which we operate, while retaining a highly liquid and lowly geared balance sheet."
Lockie Given, Chief Executive Officer
"The results demonstrate the significant earnings power of our platform and our ability to generate consistent profitable growth while maintaining strong financial discipline. PLO of $303.9 million increased 11% or 9% on a same store basis, driven by an increase in average loan size reflecting higher gold values and the increase in value of general merchandise."
Tim Jugman, Chief Financial Officer
Strategic Positioning
1. Jewelry Mix and Gold Price Leverage
The shift toward jewelry-backed pawn loans (PLO) in the US, now at 68% of PLO, creates a dual advantage: higher margin potential and direct exposure to gold price movements. This mix change has been a deliberate strategic move, allowing EZPW to benefit from elevated gold prices through scrap sales and to maintain strong merchandise margins. Management emphasized the adaptability of the business model to gold volatility, highlighting the short-term nature of loans and rapid inventory turnover as risk mitigants.
2. Latin America as a Growth Engine
Latin America, especially Mexico, is a clear focus for expansion, with 17% PLO growth and a pipeline of de novo and acquired stores. The business is still early in optimizing jewelry lending and digital adoption in these markets, with management pointing to significant untapped potential in both operational improvement and M&A runway. The balanced growth profile—PLO rising faster than inventory, strong loan demand, and disciplined age metrics—signals scalable momentum.
3. Omnichannel and Digital Transformation
Omnichannel engagement is now a core pillar, with all US inventory viewable online and instant quote tools live in most stores. Online payments and layaway extensions are driving both customer convenience and store productivity. The Easy Plus Rewards program, now at 6.9 million members, is maturing into a data-driven loyalty engine, enabling targeted marketing and higher repeat transactions. Management sees digital as both a growth and efficiency lever, positioning EZPW as an industry leader in customer engagement.
4. Disciplined M&A and Capital Allocation
EZPW’s approach to acquisitions remains methodical, prioritizing return on invested capital and integration complexity over pure store count growth. The company is leveraging its robust balance sheet, including a $300 million senior notes offering, to fund both organic and inorganic opportunities. Management’s bias is toward existing geographies, where execution risk is lower and operational synergies are higher, but they remain open to new markets if the right opportunity arises.
5. Inventory and Turnover Optimization
Inventory growth, especially in jewelry, has outpaced PLO in the US, partly due to increased purchases and the 10-month layaway program. Management views this as an operational opportunity, not a concern, and has launched new incentive programs and talent investments to boost sales velocity and improve turns. The focus is on long-term neighborhood sales rather than short-term scrap gains, aligning inventory strategy with customer loyalty and margin sustainability.
Key Considerations
EZPW’s Q4 and FY25 results reflect a business at a strategic inflection point, balancing legacy pawn lending with accelerated digital and geographic expansion. Investors should focus on the sustainability of margin gains and the operational leverage from recent investments.
Key Considerations:
- Jewelry Mix as Margin Catalyst: Sustained high jewelry PLO and inventory composition underpin margin expansion and gold price sensitivity.
- Latin America’s Early-Stage Upside: Store and PLO growth in Mexico and beyond remain in early innings, with further digital and operational gains possible.
- Digital Engagement Drives Loyalty: Easy Plus Rewards and omnichannel access are translating into higher repeat business and operational efficiency.
- Inventory Management Initiatives: New incentives and talent investments are aimed at improving inventory turns and unlocking latent gross profit.
- M&A Discipline Maintained: Management continues to prioritize disciplined, return-based acquisitions in both core and adjacent markets.
Risks
EZPW’s exposure to gold prices remains a material variable, with management expecting scrap profit normalization as gold stabilizes. Inventory growth, especially in jewelry, could pressure turns if not matched by accelerated sales. Macroeconomic shifts, regulatory changes, and competitive digital offerings could impact loan demand, while M&A integration risk persists as the company expands its footprint.
Forward Outlook
For Q1 2026, EZPW management guided to:
- Scrap sales gross profit expected to remain at recent levels, then decline sequentially as gold prices normalize.
- Continued sequential increase in total expenses as store base and digital initiatives scale.
For full-year 2026, management did not provide explicit financial guidance but reiterated a focus on:
- Growing PLO and improving inventory efficiency across all geographies.
- Scaling digital and omnichannel initiatives to drive both top-line and margin gains.
Management highlighted several factors that will influence results:
- Gold price volatility and its impact on scrap profit and jewelry inventory valuation.
- The pace and integration of new store openings and acquisitions in core markets.
Takeaways
EZPW enters FY26 with a resilient and scalable business model, leveraging its jewelry mix and digital engagement to drive margin and growth. Investors should monitor the sustainability of margin gains and the company’s ability to translate digital and operational investments into improved inventory turns and repeat business.
- Jewelry and Digital Leverage: The combination of high jewelry PLO and omnichannel engagement is unlocking new margin and customer loyalty levers.
- Latin America as a Growth Engine: Early-stage momentum in Mexico and other LATAM markets offers a multi-year runway for disciplined expansion.
- Inventory and Scrap Normalization: Watch for inventory turnover improvements and normalization of scrap profits as gold prices stabilize in FY26.
Conclusion
EZPW’s Q4 results cap a year of record growth, strategic transformation, and operational discipline. The business is well-positioned to capitalize on jewelry mix, digital scale, and disciplined M&A, though investors should watch inventory turns and gold price normalization as key variables heading into FY26.
Industry Read-Through
EZPW’s results reflect a broader shift in the pawn and specialty finance sector toward digital engagement, inventory optimization, and margin management. The company’s omnichannel and loyalty investments set a new bar for customer experience in a traditionally analog segment, while its disciplined approach to jewelry lending and M&A signals a template for resilient, scalable growth. Competitors in both US and Latin American pawn markets will need to accelerate digital and operational innovation to keep pace, while gold price volatility remains a sector-wide margin swing factor. The read-through for retail and alternative lending is clear: operational agility, digital-first customer engagement, and inventory discipline are now critical for sustainable profit growth in a changing consumer landscape.