Digital banking company Axos Financial (NYSE:AX) reported Q3 2026 results topping the market's revenue expectations , with revenue up 22.2% year on year to $395.1 million. Its non-GAAP profit of $2.34 per share was 3.7% above analysts' consensus estimates.
For more on Axos Financial, read the full research report .
Axos Financial (AX) Q3 2026 highlights:
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Net interest income$331.3 million vs analysts' consensus estimates of $326.5 million (13.8% year-on-year growth, 1.4% beat)
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Net interest margin4.6% vs analysts' consensus estimates of 4.5% (10.3 basis point beat)
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Revenue$395.1 million vs analysts' consensus estimates of $386.4 million, according to S&P (22.2% year-on-year growth, 2.2% beat)
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Efficiency ratio49.5% vs analysts' consensus estimates of 48.6% (89.5 basis point miss)
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Adjusted EPS$2.34 vs analysts' consensus estimates of $2.26, according to S&P (3.7% beat)
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Tangible book value per share$52.68 vs analysts' consensus estimates of $53.44 (15.3% year-on-year growth, 1.4% miss)
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Market capitalization$5.19 billion
"Net interest margin increased by 10 basis points quarter-over-quarter, resulting in a 16.8% annualized growth in net interest income," stated Greg Garrabrants, President and Chief Executive Officer of Axos. "Excluding net paydowns in single-family mortgage and warehouse, multifamily and small balance commercial real estate, ending loans grew by approximately $563 million this quarter. Our loan pipeline remains solid, and we expect a few large loans that did not close in the September 2026 quarter to drive an acceleration in overall loan growth in the December 2026 quarter."
Revenue growth
Net interest income and fee-based revenue are the two pillars supporting bank earnings. The former captures profit from the gap between lending rates and deposit costs, while the latter encompasses charges for banking services, credit products, wealth management and trading activities. Over the last five years, Axos Financial grew its revenue at a strong 18.5% compounded annual growth rate. Its growth surpassed the average banking company and shows its offerings resonate with customers.
Long-term growth matters the most, but within financials, a half-decade historical view may miss recent interest rate changes, market returns and industry trends. Axos Financial's annualized revenue growth of 14.5% over the last two years is below its five-year trend, but the results still suggest healthy demand.
This quarter, Axos Financial reported strong year-on-year revenue growth of 22.2%, and its $395.1 million of revenue topped Wall Street's consensus estimates by 2.2%.
Net interest income made up 87% of the company's total revenue during the last five years, meaning Axos Financial barely relies on non-interest income to drive its overall growth.
Markets consistently prioritize net interest income growth over fee-based revenue, recognizing its superior quality and recurring nature compared to the more unpredictable non-interest income streams.
Tangible book value per share (TBVPS)
The balance sheet drives banking profitability since earnings flow from the spread between borrowing and lending rates. As such, valuations for these companies concentrate on capital strength and sustainable equity accumulation potential.
This is why tangible book value per share (TBVPS) is the most important metric to track for banks. TBVPS represents the real, liquid net worth per share of a bank, excluding intangible assets that have debatable value upon liquidation. On the other hand, EPS is often distorted by mergers and flexible loan loss accounting. TBVPS provides clearer performance insights.
Axos Financial's TBVPS grew at a strong 19.4% annual rate over the last five years. TBVPS growth has recently decelerated to 15.2% annual growth over the last two years (from $39.70 to $52.68 per share).
Over the next 12 months, consensus estimates call for Axos Financial's TBVPS to grow by 20.5% to $63.48, a strong growth rate.
Key takeaways from Axos Financial's Q3 results
Axos Financial beat analysts' consensus estimates for revenue and narrowly topped Wall Street's consensus for net interest income. EPS also came in slightly ahead, but tangible book value per share missed slightly, leaving a mixed picture for the quarter. Shares remained flat at $92.58 immediately after the report.
To assess Axos Financial at its current price, the latest quarter matters, but longer-term business quality and valuation are more important when deciding whether to invest. Read our free full research report here .
