Company: AX
Filing Date: 2025-10-30
Form Type: 10-Q
Source: 0001299709-25-000184
Chunk: 135

Company: Axos Financial, Inc.
Filing Date: 2025-10-30
Form: 10-Q
Item: Part I, Item 2
Chunk 135
---
$3.4 million in professional services primarily due to higher legal expenses and acquisition-related costs associated with the Verdant acquisition;

•$3.1 million in data and operating processing to support the Company’s growth and continued investments in technology; and

•$2.3 million in salaries and related costs primarily due to increased headcount and salaries. 

These increases were partially offset by a decrease of $2.0 million in advertising and promotional expense primarily as a result of reduced deposit marketing expense in the current period.

37

Provision for Income Taxes

Income tax expense was $37.5 million for the three months ended September 30, 2025, compared to $46.9 million for three months ended September 30, 2024. Our effective income tax rates for the three months ended September 30, 2025 and 2024 were 25.04% and 29.43%, respectively. The decrease in effective income tax rate for the three months ended September 30, 2025 reflects, in part, a change in the State of California income tax law effective beginning with the Company’s 2026 fiscal year.

SEGMENT RESULTS

Our Company determines reportable segments based on the services offered, the significance of the services offered, the significance of those services to our Company’s financial condition and operating results and management’s regular review of the operating results of those services. Our Company operates through two operating segments: the Banking Business Segment and the Securities Business Segment. In order to reconcile the two segments to the consolidated totals, our Company includes corporate activities and intercompany eliminations. Inter-segment transactions are eliminated in consolidation and primarily include non-interest income earned by the Securities Business Segment and non-interest expense incurred by the Banking Business Segment for cash sorting fees related to deposits sourced from Securities Business Segment customers.

The following tables present the operating results of the segments:

For the Three Months Ended September 30, 2025(Dollars in thousands)Banking Business SegmentSecurities Business SegmentCorporate/EliminationsAxos ConsolidatedNet interest income$287,200 $8,194 $(4,344)$291,050 Provision for credit losses17,255 — — 17,255 Non-interest income12,375 29,457 (9,492)32,340 Non-interest expense128,493 29,367 (1,614)156,246 Income before income taxes$153,827 $8,284 $(12,222