PRA Group reported a $408 million net loss for the third quarter of 2025, driven by a $413 million noncash goodwill impairment related to historical European acquisitions. Despite the headline loss, the company showed signs of operational strength, including higher legal collections here in the U.S., reduced leverage, and improved efficiency.The company also announced it is opening a second talent hub in 2026 to strengthen its analytics and technology departments.
Cash collections up, led by legal recoveries: Total cash collections increased 14% year over year to $542 million, outperforming expectations by 8%. The U.S. legal channel grew 27% compared to the prior year and now represents nearly half of all U.S. core collections. Company CEO Martin Sjolund noted, “We now have around one third of our calling capacity offshore,” emphasizing the company’s drive toward cost optimization and performance improvement.
Adjusted profitability masks impairment impact: Excluding the goodwill impairment, PRA Group reported adjusted net income of $21 million, or $0.53 per diluted share. Adjusted EBITDA grew 15% to $1.3 billion over the last twelve months, marking the company’s ninth straight quarter of adjusted EBITDA growth. CFO Rakesh Sehgal reported that estimated remaining collections (ERC) rose to $8.4 billion, which is up 15% year over year and 1% sequentially, reflecting both portfolio performance and disciplined purchasing.
Portfolio investments: PRA Group purchased $255 million in portfolios during the quarter, 60% in the Americas and 40% in Europe. Management reaffirmed its full-year guidance for $1.2 billion in portfolio purchases and high single-digit cash collections growth.
Operational restructuring: In the U.S., headcount was reduced by more than 115 corporate roles and 170 agents, generating approximately $20 million in annualized gross cost savings, which were offset by $3 million in added outsourcing costs. PRA also plans to open a second U.S. talent hub in Charlotte, North Carolina, in early 2026 to strengthen analytics and technology hiring.
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