Aaron's Company (AAN) TD Financial Services & Fintech Summit summary

Consumer trends and macro environment

• Lease-to-own consumers remain resilient despite ongoing macroeconomic challenges, with stable payment activity and increased lease agreements per customer, though at lower average prices.

• Aggregate monthly payments from customers have increased, indicating healthy engagement.

• BrandsMart has seen improved store traffic but continued pressure from consumers trading down to lower-priced products.

Merchandise categories and portfolio growth

• Appliances remain the core category at BrandsMart, with expansion into furniture to attract new customers.

• Anticipated replacement cycles in laptops and consumer electronics are expected to benefit sales in late 2024 and into 2025.

• Strong demand persists across most product categories, but trade-down within categories is evident.

Growth strategies and operational initiatives

• Unified decisioning and customer origination programs are driving growth, especially in e-commerce.

• Marketing improvements have led to higher aggregate monthly payments per customer.

• Continued execution of these strategies is expected to deliver mid-single-digit lease portfolio growth by year-end.