Company: GDOT
Filing Date: 2025-11-10
Form Type: 10-Q
Source: 0001386278-25-000076
Chunk: 194

Company: GREEN DOT CORP
Filing Date: 2025-11-10
Form: 10-Q
Item: Part I, Item 8
Chunk 194
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1)Effective tax rate19.9 %(4.6)%

Our income tax benefit totaled $12.9 million for the nine months ended September 30, 2025, representing an increase of $14.4 million from the prior year comparable period, driven primarily by the same factors discussed above under “Comparison of Three-Month Periods Ended September 30, 2025 and 2024—Income Tax Expense and Benefit."

The increase in our effective tax rate for the nine months ended September 30, 2025 from the prior year comparable period was due to several factors, including a reduced tax rate benefit due to an increase of $0.8 million in the amount of compensation expense that was subject to the IRC 162(m) limitation on the deductibility of certain executive compensation, a decrease of $1.0 million in general business credits, an increase of $2.6 million in the valuation allowance on the deferred tax assets of our China subsidiary, and a lower tax rate benefit from the cash surrender value in bank-owned life insurance policies. These increases were partially offset by a decrease of $0.9 million in state income taxes expense, net of federal benefits, a decrease of $1.2 million in tax expense associated with shortfalls from stock-based compensation, a decrease of $2.3 million related to bank-owned life insurance surrender penalties we incurred in connection with the surrender and restructuring of our existing bank-owned life insurance policies in 2024, and a decrease of $9.7 million in tax expense from nondeductible expenses and penalties associated with the civil money penalty we incurred in 2024 for our Consent Order.

The "Other" category in our effective tax rate consists of a variety of permanent differences, none of which were individually significant.

Segment Results

B2B Services

The results of operations and key metrics of our B2B Services segment for the three and nine months ended September 30, 2025 and 2024 were as follows:

Three Months Ended September 30,Nine Months Ended September 30,20252024Change%20252024Change%(In thousands, except percentages)Financial ResultsSegment revenues$364,223 $276,402 $87,821 31.8 %$1,054,864 $769,658 $285,206 37.1 %Segment expenses334,683 248,666 86,017 34.6 %970,192 704,561 265,631 37