0000933036-24-000181 | 10-Q | XBRL Viewer

Senior Notes	9 Months Ended
Senior Notes	Sep. 30, 2024
Subsidiary Guarantors - Senior Notes [Abstract]
Senior Notes	Senior Notes On February 17, 2021, we issued $450 million in senior unsecured notes all of which are due February 15, 2029, at par value, bearing interest at 6.375% (the “Notes”), the proceeds of which were used to fund a portion of the consideration upon closing of the Acima Holdings acquisition. Interest on the Notes is payable in arrears on February 15 and August 15 of each year. In connection with the issuance of the Notes, we incurred approximately $15.7 million in debt issuance costs, including bank financing fees and third party legal and other professional fees, which were capitalized in accordance with ASC Topic 470, “Debt” and recorded as a reduction of our outstanding Notes in our Condensed Consolidated Balance Sheets. Debt issuance costs are amortized as interest expense over the term of the Notes. As of September 30, 2024, the total remaining balance of unamortized debt issuance costs related to our Notes reported in the Condensed Consolidated Balance Sheets was approximately $8.6 million. We may redeem some or all of the Notes at any time for cash at the redemption prices set forth in the indenture governing the Notes, plus accrued and unpaid interest to, but not including, the redemption date. If we experience specific kinds of change in control, we will be required to offer to purchase the Notes at a price equal to 101% of the principal amount thereof plus accrued and unpaid interest. The Notes are our general unsecured senior obligations, and are effectively subordinated to all of our existing and future secured indebtedness to the extent of the value of the collateral securing such indebtedness, structurally subordinated to all existing and future indebtedness and other liabilities of our non-guarantor subsidiaries, equal in right of payment to all of our and our guarantor subsidiaries’ existing and future senior unsecured indebtedness and senior in right of payment to all of our future subordinated indebtedness, if any. The Notes are jointly and severally guaranteed on a senior unsecured basis by certain of our domestic subsidiaries that have outstanding indebtedness or guarantee other specified indebtedness, including the ABL Credit Facility and the Term Loan Facility. The indenture governing the Notes contains covenants that limit, among other things, our ability and the ability of some of our restricted subsidiaries to create liens, transfer or sell assets, incur indebtedness or issue certain preferred stock, pay dividends, redeem stock or make other distributions, make other restricted payments or investments, create restrictions on payment of dividends or other amounts to us by our restricted subsidiaries, merge or consolidate with other entities, engage in certain transactions with affiliates and designate our subsidiaries as unrestricted subsidiaries. These covenants are subject to a number of exceptions and qualifications. The covenants limiting restricted payments, restrictions on payment of dividends or other amounts to us by our restricted subsidiaries, the ability to incur indebtedness, asset dispositions and transactions with affiliates will be suspended if and while the Notes have investment grade ratings from any two of Standard & Poor’s Ratings Services, Moody’s Investors Service, Inc. and Fitch, Inc. The indenture governing the Notes also provides for events of default, which, if any of them occurs, would permit or require the principal, premium, if any, and interest on all the then outstanding Notes to be due and payable.

Basis of Presentation (Policies)	9 Months Ended
Basis of Presentation (Policies)	Sep. 30, 2024
Basis of Presentation [Abstract]
Use of Estimates	Use of Estimates In preparing financial statements in conformity with U.S. generally accepted accounting principles, we are required to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent losses and liabilities at the date of the condensed consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. In applying accounting principles, we must often make individual estimates and assumptions regarding expected outcomes or uncertainties. Our estimates, judgments and assumptions are continually evaluated based on available information and experience. However, uncertainties, including those related to recent macroeconomic trends or other factors, may affect certain estimates and assumptions inherent in the financial reporting process, which may impact reported amounts of assets and liabilities in future periods and cause actual results to differ from those estimates.
Principles of Consolidation and Nature of Operations	Principles of Consolidation and Nature of Operations The financial statements included herein include the accounts of Upbound Group, Inc. and its direct and indirect subsidiaries. All intercompany accounts and transactions have been eliminated. Unless the context indicates otherwise, references to “Upbound Group, Inc.” refer only to Upbound Group, Inc., the parent, and references to the “Company”, “we,” “us” and “our” refer to the consolidated business operations of Upbound Group and any or all of its direct and indirect subsidiaries. We report four operating segments: Acima, Rent-A-Center, Mexico, and Franchising. Our Acima segment, which primarily operates in the United States and Puerto Rico, includes the operations of Acima Holdings and certain locations previously operating under our Acceptance Now brand and generally offers consumers who do not qualify for traditional financing the lease-to-own transaction through staffed or unstaffed kiosks located within third-party retailer locations or other virtual options. In virtual locations, customers, either directly or with the assistance of a representative of the third-party retailer, initiate the lease-to-own transaction online in the retailers’ locations using our virtual solutions. Our Rent-A-Center segment consists of company-owned lease-to-own stores in the United States and Puerto Rico that lease household durable goods to customers through lease purchase agreements. We also offer merchandise on an installment sales basis in certain of our stores under the names “Get It Now” and “Home Choice” in Minnesota and Wisconsin. Our Rent-A-Center segment operates through our company-owned stores and e-commerce platforms through rentacenter.com, getitnowstores.com and homechoicestores.com. Our Mexico segment consists of our company-owned stores in Mexico that lease household durable goods to customers on a lease-to-own basis. Rent-A-Center Franchising International, Inc., an indirect wholly-owned subsidiary of Upbound Group, Inc., is a franchisor of lease-to-own stores. Our Franchising segment’s primary source of revenue is the sale of rental merchandise to our franchisees, who in turn offer the merchandise to the general public for rent or purchase under a lease-to-own transaction. The balance of our Franchising segment’s revenue is generated primarily from royalties based on franchisees’ monthly gross revenues.
Newly Adopted Accounting Pronouncements	Newly Adopted Accounting Pronouncements In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which requires enhanced disclosures of significant segment expenses on a quarterly and annual basis and is intended to improve the transparency of reportable segment disclosures. Adoption of ASU 2023-07 was required for us beginning January 1, 2024 for our Annual Report on Form 10-K for the year ended December 31, 2024 and interim periods beginning in 2025. We will include required disclosures updates beginning with our Annual Report on Form 10-K for fiscal year ended December 31, 2024 using a retrospective approach.

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Statement of Financial Position [Abstract]
Allowance for doubtful accounts	$ 13,773	$ 14,254
Property assets, accumulated depreciation	$ 640,997	$ 611,120
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	250,000,000	250,000,000
Common stock, shares, issued (in shares)	125,756,530	125,415,059
Treasury stock (in shares)	71,060,928	71,060,928

Earnings Per Common Share

9 Months Ended

Sep. 30, 2024

Earnings Per Share [Abstract]

Earnings Per Common Share

Summarized basic and diluted earnings per common share were calculated as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands, except per share data)	2024		2023		2024		2023
Numerator:
Net earnings	$	30,860	$	4,363	$	92,496	$	6,075
Denominator:
Weighted-average shares outstanding	54,700		55,485		54,631		55,294
Effect of dilutive stock awards(1)	1,262		1,367		1,242		1,373
Weighted-average dilutive shares	55,962		56,852		55,873		56,667

Basic earnings per common share	$	0.56	$	0.08	$	1.69	$	0.11
Diluted earnings per common share(1)	$	0.55	$	0.08	$	1.66	$	0.11
Anti-dilutive securities excluded from diluted earnings per common share:
Anti-dilutive restricted share units	—		43		1		43
Anti-dilutive performance share units	478		—		478		740
Anti-dilutive stock options	55		129		56		200

(1) Weighted-average dilutive shares outstanding for the nine months ended September 30, 2023, includes approximately 0.4 million common shares, issued in connection with the acquisition of Acima Holdings and subject to vesting conditions under restricted stock agreements.

Revenues (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
Revenues (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023	Dec. 31, 2023
Disaggregation of Revenue [Line Items]
Rentals and fees	$ 877,831	$ 806,766	$ 2,636,347	$ 2,421,039
Merchandise sales	150,752	127,564	476,690	415,256
Installment sales	14,416	13,444	44,333	45,191
Franchise merchandise sales	18,195	24,082	60,136	69,778
Royalty income and fees	5,863	5,813	18,539	18,636
Other	1,802	1,429	5,291	4,422
Total revenues	1,068,859	979,098	3,241,336	2,974,322
Rental purchase agreements [Member]
Disaggregation of Revenue [Line Items]
Deferred revenue	62,700		62,700		$ 68,600
Other product plans [Member]
Disaggregation of Revenue [Line Items]
Deferred revenue	600		600		1,100
Franchise fees [Member]
Disaggregation of Revenue [Line Items]
Deferred revenue	2,900		2,900		$ 3,000
Acima [Member]
Disaggregation of Revenue [Line Items]
Rentals and fees	442,463	375,202	1,301,874	1,107,943
Merchandise sales	123,299	99,857	377,389	314,741
Installment sales	0	0	0	0
Franchise merchandise sales	0	0	0	0
Royalty income and fees	0	0	0	0
Other	421	157	1,060	737
Acima [Member] \| Operating segments [Member]
Disaggregation of Revenue [Line Items]
Total revenues	566,183	475,216	1,680,323	1,423,421
Rent-A-Center [Member]
Disaggregation of Revenue [Line Items]
Rentals and fees	417,327	413,051	1,277,477	1,260,745
Merchandise sales	26,707	26,819	96,701	97,905
Installment sales	14,416	13,444	44,333	45,191
Franchise merchandise sales	0	0	0	0
Royalty income and fees	0	0	0	0
Other	293	318	888	990
Rent-A-Center [Member] \| Operating segments [Member]
Disaggregation of Revenue [Line Items]
Total revenues	458,743	453,632	1,419,399	1,404,831
Mexico [Member]
Disaggregation of Revenue [Line Items]
Rentals and fees	18,041	18,513	56,996	52,351
Merchandise sales	746	888	2,600	2,610
Installment sales	0	0	0	0
Franchise merchandise sales	0	0	0	0
Royalty income and fees	0	0	0	0
Other	243	241	869	565
Mexico [Member] \| Operating segments [Member]
Disaggregation of Revenue [Line Items]
Total revenues	19,030	19,642	60,465	55,526
Franchising [Member]
Disaggregation of Revenue [Line Items]
Rentals and fees	0	0	0	0
Merchandise sales	0	0	0	0
Installment sales	0	0	0	0
Franchise merchandise sales	18,195	24,082	60,136	69,778
Royalty income and fees	5,863	5,813	18,539	18,636
Other	845	713	2,474	2,130
Franchising [Member] \| Operating segments [Member]
Disaggregation of Revenue [Line Items]
Total revenues	$ 24,903	$ 30,608	$ 81,149	$ 90,544

Segment Information

9 Months Ended

Sep. 30, 2024

Segment Information [Abstract]

Segment Information

The operating segments reported below are the segments for which separate financial information is available and for which segment results are evaluated by the chief operating decision makers. Our operating segments are organized based on factors including, but not limited to, type of business transactions, geographic location and store ownership. Within our operating segments, we offer merchandise for lease from certain basic product categories, such as: furniture, including mattresses; tires; consumer electronics; appliances; tools; handbags; computers; smartphones; and accessories.

Segment information as of and for the three and nine months ended September 30, 2024 and 2023 is as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2024		2023		2024		2023
Revenues
Acima	$	566,183	$	475,216	$	1,680,323	$	1,423,421
Rent-A-Center	458,743		453,632		1,419,399		1,404,831
Mexico	19,030		19,642		60,465		55,526
Franchising	24,903		30,608		81,149		90,544
Total revenues	$	1,068,859	$	979,098	$	3,241,336	$	2,974,322


	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2024		2023		2024		2023
Gross profit
Acima	$	173,969	$	159,427	$	522,882	$	474,258
Rent-A-Center	316,750		317,233		984,898		975,210
Mexico	13,714		13,971		43,441		39,410
Franchising	6,653		6,535		20,892		20,778
Total gross profit	$	511,086	$	497,166	$	1,572,113	$	1,509,656


	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2024		2023		2024		2023
Operating profit
Acima	$	63,994	$	58,124	$	185,896	$	175,103
Rent-A-Center	68,923		63,762		210,730		211,637
Mexico	884		1,124		4,139		3,417
Franchising	4,344		3,541		12,237		13,280
Total operating segments	138,145		126,551		413,002		403,437
Corporate(1)	(68,086)		(68,499)		(200,526)		(296,467)
Total operating profit	$	70,059	$	58,052	$	212,476	$	106,970

(1) Includes stock compensation expense of $4.9 million recognized for the nine months ended September 30, 2024 and $9.4 million and $128.1 million recognized for the three and nine months ended September 30, 2023, respectively, related to common stock issued to Acima Holdings employees under restricted stock agreements as part of the acquisition consideration subject to vesting restrictions as described in Note 11. These restricted stock agreements were fully vested during the three months ended March 31, 2024.


	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2024		2023		2024		2023
Depreciation and amortization
Acima(1)	$	352	$	420	$	1,024	$	1,263
Rent-A-Center	5,207		4,421		14,977		13,964
Mexico	405		345		1,139		880
Franchising	36		36		108		110
Total operating segments	6,000		5,222		17,248		16,217
Corporate(2)	6,770		7,402		21,613		21,885
Total depreciation and amortization	$	12,770	$	12,624	$	38,861	$	38,102

(1) Excludes amortization expense of approximately $10.9 million and $34.5 million for the three and nine months ended September 30, 2024, and $14.3 million and $42.8 million for the three and nine months ended September 30, 2023, respectively, recorded to other gains and charges in the Condensed Consolidated Statements of Operations, related to intangible assets acquired upon closing of the Acima Holdings acquisition. See Note 9 for additional information.

(2) Excludes depreciation expense of approximately $4.0 million and $18.0 million for the three and nine months ended September 30, 2024, and $8.6 million and $16.5 million for the three and nine months ended September 30, 2023 recorded to other gains and charges in the Condensed Consolidated Statements of Operations, related to software acquired upon closing of the Acima Holdings acquisition and accelerated software depreciation. See Note 9 for additional information.


	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2024		2023		2024		2023
Capital expenditures
Acima	$	246	$	121	$	1,454	$	203
Rent-A-Center	10,089		6,822		20,543		12,587
Mexico	199		508		1,697		1,902
Franchising	—		—		—		1
Total operating segments	10,534		7,451		23,694		14,693
Corporate	7,414		7,322		20,498		21,474
Total capital expenditures	$	17,948	$	14,773	$	44,192	$	36,167


(in thousands)	September 30, 2024		December 31, 2023
On rent rental merchandise, net
Acima	$	602,303	$	606,912
Rent-A-Center	393,403		478,774
Mexico	21,010		24,210
Total on rent rental merchandise, net	$	1,016,716	$	1,109,896


(in thousands)	September 30, 2024		December 31, 2023
Held for rent rental merchandise, net
Acima	$	176	$	498
Rent-A-Center	112,824		112,129
Mexico	10,055		11,540
Total held for rent rental merchandise, net	$	123,055	$	124,167


(in thousands)	September 30, 2024		December 31, 2023
Assets by segment
Acima	$	1,209,699	$	1,221,845
Rent-A-Center	925,929		1,061,107
Mexico	56,424		57,347
Franchising	20,412		18,023
Total operating segments	2,212,464		2,358,322
Corporate	366,026		363,108
Total assets	$	2,578,490	$	2,721,430

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

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+ Details

Other Gains and Charges - Activity (Details) $ in Thousands		3 Months Ended		9 Months Ended
Other Gains and Charges - Activity (Details) $ in Thousands	Feb. 17, 2021 USD ($) shares	Sep. 30, 2024 USD ($) store	Sep. 30, 2023 USD ($)	Sep. 30, 2024 USD ($) store	Sep. 30, 2023 USD ($)
Unusual or Infrequent Item, or Both [Line Items]
Other gains and charges		$ 28,148	$ 29,057	$ 79,866	$ 184,413
Number of stores consolidated in 2024 \| store		55		55
Acima acquired assets depreciation [Member]
Unusual or Infrequent Item, or Both [Line Items]
Other gains and charges				$ 11,900	11,900
Accelerated software depreciation
Unusual or Infrequent Item, or Both [Line Items]
Other gains and charges		$ 0	4,609	6,145	4,609
Asset impairments
Unusual or Infrequent Item, or Both [Line Items]
Other gains and charges		(67)	0	5,961	0
Impaired Long-Lived Assets Held and Used, Operating Lease, Right-of-Use Asset
Unusual or Infrequent Item, or Both [Line Items]
Other gains and charges				5,300
Impaired Long-Lived Assets Held and used, Property, Plant and Equipment
Unusual or Infrequent Item, or Both [Line Items]
Other gains and charges				600
Accelerated stock compensation
Unusual or Infrequent Item, or Both [Line Items]
Other gains and charges		1,688	0	3,421	0
Legal matters
Unusual or Infrequent Item, or Both [Line Items]
Other gains and charges		11,038	(96)	11,738	44
Other(1)
Unusual or Infrequent Item, or Both [Line Items]
Other gains and charges		588	(3,069)	1,261	(3,069)
Other charges [Member]
Unusual or Infrequent Item, or Both [Line Items]
Other gains and charges				1,000
Estimated Settlement Accruals
Unusual or Infrequent Item, or Both [Line Items]
Other gains and charges				8,200
Litigation and Defense Expenses
Unusual or Infrequent Item, or Both [Line Items]
Other gains and charges		3,500		3,500
Acima Holdings [Member]
Unusual or Infrequent Item, or Both [Line Items]
Stock consideration, shares \| shares	10,779,923
Award vesting period	36 months
Other intangible assets	$ 520,000
Acima Holdings [Member] \| Software [Member]
Unusual or Infrequent Item, or Both [Line Items]
Property assets	$ 170,000
Acima Holdings [Member] \| Acima acquired assets amortization [Member]
Unusual or Infrequent Item, or Both [Line Items]
Other gains and charges		10,900	14,300	34,500	42,800
Acima Holdings [Member] \| Acima acquired assets depreciation and amortization
Unusual or Infrequent Item, or Both [Line Items]
Other gains and charges		14,901	18,234	46,447	54,701
Acima Holdings [Member] \| Acima equity consideration vesting
Unusual or Infrequent Item, or Both [Line Items]
Other gains and charges		$ 0	$ 9,379	$ 4,893	$ 128,128
Acima Holdings [Member] \| Restricted share units [Member]
Unusual or Infrequent Item, or Both [Line Items]
Stock consideration, shares \| shares	8,096,595
Stock consideration, value	$ 414,100
Acima Holdings [Member] \| Restricted share units [Member]
Unusual or Infrequent Item, or Both [Line Items]
Stock consideration, shares \| shares	8,096,595

Senior Debt

9 Months Ended

Sep. 30, 2024

Debt Disclosure [Abstract]

Senior Debt

On February 17, 2021, we entered into a credit agreement with JPMorgan Chase Bank, N.A., as administrative agent, and lenders party thereto, providing for a seven-year $875 million senior secured term loan facility (the “Term Loan Facility”), as amended on September 21, 2021, June 15, 2023 and May 28, 2024, and an Asset Based Loan Credit Facility (the “ABL Credit Facility”), as amended August 10, 2022 and June 7, 2024, providing for a five-year asset-based revolving credit facility with commitments of $550 million and a letter of credit sublimit of $150 million. Commitments under the ABL Credit Facility may be increased, at our option and under certain conditions, by up to an additional $125 million in the aggregate.

Proceeds from the Term Loan Facility were net of original issue discount of $4.4 million upon issuance from the lenders. In addition, in connection with the closing of the Term Loan Facility and the ABL Credit Facility, we incurred approximately $30.2 million in debt issuance costs, including third party legal and other professional fees, of which $25.3 million was capitalized in accordance with ASC Topic 470, “Debt” and recorded as a reduction of our outstanding senior debt, net in our Condensed Consolidated Balance Sheets.

On August 10, 2022, we entered into a First Amendment to the ABL Credit Facility, effective as of August 10, 2022. The amendment effected the replacement of LIBOR with Term Secured Overnight Financing Rate (“Term SOFR”) as the benchmark rate of interest thereunder.

On June 15, 2023, we entered into a Second Amendment to the Term Loan Facility, effective as of June 15, 2023. The amendment effected the replacement of LIBOR with Term SOFR as the benchmark rate of interest.

On May 28, 2024 we entered into a Third Amendment to the Term Loan Facility, effective as of May 28, 2024. The amendment, in addition to certain other changes, effected a repricing of the applicable margin under the Term Loan Facility by reducing the applicable margin, with respect to any initial term loans, by 50 basis points from 3.25% to 2.75% and removing the credit spread adjustment that was previously included in the calculation of the adjusted Term SOFR rate for term benchmark loans.

In connection with the execution of the Third Amendment to the Term Loan Facility, we incurred approximately $2.0 million in debt issuance costs, including third party arrangement and other professional fees, of which approximately $1.8 million were expensed as debt refinance charges in our Condensed Consolidated Statement of Operations, and approximately $0.2 million were capitalized and recorded as a reduction to our outstanding senior debt in our Condensed Consolidated Balance Sheets. In addition, in accordance with ASC Topic 470, “Debt”, we recorded approximately $4.4 million in write-offs of unamortized debt issuance costs and original issue discount previously capitalized upon the issuance of the Term Loan Facility on February 17, 2021. The write-offs were recorded as debt refinance charges in our Condensed Consolidated Statement of Operations.

On June 7, 2024, we entered into a Second Amendment to the ABL Credit Facility, effective as of June 7, 2024. The amendment, in addition to certain other changes, extended the maturity date for loans outstanding to June 7, 2029 (subject to certain springing maturity provisions).

In connection with the execution of the Second Amendment to the ABL Credit Facility, we incurred approximately $3.2 million in debt issuance costs, including third-party arrangement and other professional fees, which were capitalized and recorded as a reduction to our outstanding senior debt in our Condensed Consolidated Balance Sheets. In addition, in accordance with ASC Topic 470, “Debt”, we recorded approximately $0.4 million in write-offs of unamortized debt issuance costs previously capitalized upon the issuance of the ABL Credit Facility on February 17, 2021. The write-offs were recorded as debt refinance charges in our Condensed Consolidated Statement of Operations.

As of September 30, 2024, the total remaining balance of unamortized debt issuance costs and original issue discount related to our senior debt reported in the Condensed Consolidated Balance Sheets was approximately $9.4 million and $0.8 million, respectively. Remaining unamortized debt issuance costs and original issue discount will be amortized to interest expense over the remaining terms of the ABL Credit Facility and Term Loan Facility.

We had no outstanding borrowings under our ABL Credit Facility at September 30, 2024 and borrowing capacity of $494.4 million, net of issued letters of credit of approximately $55.6 million. The amount outstanding under the Term Loan Facility was $804.5 million at September 30, 2024.

ABL Credit Facility

The ABL Credit Facility will mature on June 7, 2029, (subject to certain springing maturity provisions). We may borrow only up to the lesser of the level of the then-current borrowing base and the aggregate amount of commitments under the ABL Credit Facility. The borrowing base is tied to the amount of eligible installment sales accounts, inventory and eligible lease contracts, reduced by certain reserves.

The ABL Credit Facility bears interest at a fluctuating rate determined by reference to an adjusted Term SOFR rate plus an applicable margin of 1.50% to 2.00%. The total interest rate on the ABL Credit Facility at September 30, 2024 was 7.35%. A commitment fee equal to 0.250% to 0.375% of the unused portion of the ABL Credit Facility fluctuates dependent upon average utilization for the prior month as defined by a pricing grid included in the governing documents of the ABL Credit Facility. The commitment fee at September 30, 2024 was 0.375%. We paid $0.7 million of commitment fees during the third quarter of 2024.

Loans under the ABL Credit Facility may be borrowed, repaid and re-borrowed until June 7, 2029, at which time all amounts borrowed must be repaid. The obligations under the ABL Credit Facility are guaranteed by us and certain of our material wholly owned domestic restricted subsidiaries, subject to certain exceptions. The obligations under the ABL Credit Facility and such guarantees are secured on a first-priority basis by all of our and our subsidiary guarantors’ accounts, inventory, deposit accounts, securities accounts, cash and cash equivalents, rental agreements, general intangibles (other than equity interests in our subsidiaries), chattel paper, instruments, documents, letter of credit rights, commercial tort claims related to the foregoing and other related assets and all proceeds thereof related to the foregoing, subject to permitted liens and certain exceptions (such assets, collectively, the “ABL Priority Collateral”) and a second-priority basis in substantially all other present and future tangible and intangible personal property of ours and the subsidiary guarantors, subject to certain exceptions.

The ABL Credit Facility contains covenants that are usual and customary for similar facilities and transactions and that, among other things, restrict our ability and our restricted subsidiaries’ ability to create certain liens and enter into certain sale and lease-back transactions; create, assume, incur or guarantee certain indebtedness; consolidate or merge with, or convey, transfer or lease all or substantially all of our and our restricted subsidiaries’ assets, to another person; pay dividends or make other distributions on, or repurchase or redeem, our capital stock or certain other debt; and make other restricted payments.

The governing documents of the ABL Credit Facility provide for customary events of default, including, but not limited to, failure to pay principal and interest, failure to comply with covenants, agreements or conditions, and certain events of bankruptcy or insolvency involving us and our significant subsidiaries. As of September 30, 2024, we were in compliance with all requirements and conditions set forth in our ABL Credit Facility governing documents.

Term Loan Facility

The Term Loan Facility, which matures on February 17, 2028, amortizes in equal quarterly installments at a rate of 1.00% per annum of the original principal amount thereof, with the remaining balance due at final maturity. Subject in each case to certain restrictions and conditions, we may add up to $500 million of incremental term loan facilities to the Term Loan Facility or utilize incremental capacity under the Term Loan Facility at any time by issuing or incurring incremental equivalent term debt.

Interest on borrowings under the Term Loan Facility is payable at a fluctuating rate of interest determined by reference to the Term SOFR rate plus an applicable margin of 2.75%, subject to a 0.50% Term SOFR floor. The total interest rate on the Term Loan Facility was 8.00% at September 30, 2024.

The Term Loan Facility is secured by a first-priority security interest in substantially all of our present and future tangible and intangible personal property, including our subsidiary guarantors, other than the ABL Priority Collateral (as defined below), and by a second-priority security interest in the ABL Priority Collateral, subject to certain exceptions. The obligations under the Term Loan Facility are guaranteed by us and our material wholly-owned domestic restricted subsidiaries that also guarantee the ABL Credit Facility.

The Term Loan Facility contains covenants that are usual and customary for similar facilities and transactions and that, among other things, restrict our ability and our restricted subsidiaries’ ability to create certain liens and enter into certain sale and lease-back transactions; create, assume, incur or guarantee certain indebtedness; consolidate or merge with, or convey, transfer or lease all or substantially all of our and our restricted subsidiaries’ assets, to another person; pay dividends or make other distributions on, or repurchase or redeem, our capital stock or certain other debt; and make other restricted payments. The Term Loan Facility also includes mandatory prepayment requirements related to asset sales (subject to reinvestment), debt incurrence (other than permitted debt) and excess cash flow, subject to certain limitations described therein. These covenants are subject to a number of limitations and exceptions set forth in the governing documents of the Term Loan Facility.

In the event our Consolidated Secured Leverage Ratio (as such term is defined in the Term Loan Facility credit agreement) exceeds 1:1, we are required to prepay the loans under the Term Loan Facility by a percentage of annual excess cash flow, as more fully described in the Term Loan Facility credit agreement. We made mandatory excess cash flow prepayments of approximately $42.6 million, including $0.6 million in accrued interest, in March 2023, relating to results for the year ended December 31, 2022.

The Term Loan Facility provides for customary events of default, including, but not limited to, failure to pay principal and interest, failure to comply with covenants, agreements or conditions, and certain events of bankruptcy or insolvency involving us and our significant subsidiaries.

The table below shows the scheduled maturity dates of our outstanding senior debt at September 30, 2024 for each of the years ending December 31:


(in thousands)	Term Loan Facility(1)		Total
2024	$	—	$	—
2025	—		—
2026	—		—
2027	—		—
2028	804,521		804,521
Thereafter	—		—
Total senior debt	$	804,521	$	804,521

(1) Annual installment requirements were reduced by the amount of the excess cash flow payment described above, in accordance with the terms of the credit agreement governing the Term Loan Facility.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 6
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481544/470-10-50-6

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 6
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481544/470-10-50-6

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 405
-SubTopic 40
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147477092/405-40-50-1

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 405
-SubTopic 40
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (a)(3)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147477092/405-40-50-1

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 405
-SubTopic 40
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (a)(2)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147477092/405-40-50-1

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 405
-SubTopic 40
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (a)(1)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147477092/405-40-50-1

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 405
-SubTopic 40
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147477092/405-40-50-1

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1B
-Subparagraph (h)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481139/470-20-50-1B

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(c))
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480678/235-10-S99-1

Reference 10: http://fasb.org/us-gaap/role/ref/legacyRef
-Topic 470
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org/470/tableOfContent

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 835
-SubTopic 30
-Name Accounting Standards Codification
-Section 45
-Paragraph 2
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482925/835-30-45-2

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1B
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481139/470-20-50-1B

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1B
-Subparagraph (g)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481139/470-20-50-1B

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1B
-Subparagraph (i)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481139/470-20-50-1B

Reference 15: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1C
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481139/470-20-50-1C

Reference 16: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1C
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481139/470-20-50-1C

Reference 17: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1C
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481139/470-20-50-1C

Reference 18: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1E
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481139/470-20-50-1E

Reference 19: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1I
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481139/470-20-50-1I

Reference 20: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1I
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481139/470-20-50-1I

Reference 21: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1I
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481139/470-20-50-1I

+ Details

Segment Information (Tables)

9 Months Ended

Sep. 30, 2023

Segment Information [Abstract]

Segment Information

Segment information as of and for the three and nine months ended September 30, 2024 and 2023 is as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2024		2023		2024		2023
Revenues
Acima	$	566,183	$	475,216	$	1,680,323	$	1,423,421
Rent-A-Center	458,743		453,632		1,419,399		1,404,831
Mexico	19,030		19,642		60,465		55,526
Franchising	24,903		30,608		81,149		90,544
Total revenues	$	1,068,859	$	979,098	$	3,241,336	$	2,974,322


	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2024		2023		2024		2023
Gross profit
Acima	$	173,969	$	159,427	$	522,882	$	474,258
Rent-A-Center	316,750		317,233		984,898		975,210
Mexico	13,714		13,971		43,441		39,410
Franchising	6,653		6,535		20,892		20,778
Total gross profit	$	511,086	$	497,166	$	1,572,113	$	1,509,656


	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2024		2023		2024		2023
Operating profit
Acima	$	63,994	$	58,124	$	185,896	$	175,103
Rent-A-Center	68,923		63,762		210,730		211,637
Mexico	884		1,124		4,139		3,417
Franchising	4,344		3,541		12,237		13,280
Total operating segments	138,145		126,551		413,002		403,437
Corporate(1)	(68,086)		(68,499)		(200,526)		(296,467)
Total operating profit	$	70,059	$	58,052	$	212,476	$	106,970


	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2024		2023		2024		2023
Depreciation and amortization
Acima(1)	$	352	$	420	$	1,024	$	1,263
Rent-A-Center	5,207		4,421		14,977		13,964
Mexico	405		345		1,139		880
Franchising	36		36		108		110
Total operating segments	6,000		5,222		17,248		16,217
Corporate(2)	6,770		7,402		21,613		21,885
Total depreciation and amortization	$	12,770	$	12,624	$	38,861	$	38,102


	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2024		2023		2024		2023
Capital expenditures
Acima	$	246	$	121	$	1,454	$	203
Rent-A-Center	10,089		6,822		20,543		12,587
Mexico	199		508		1,697		1,902
Franchising	—		—		—		1
Total operating segments	10,534		7,451		23,694		14,693
Corporate	7,414		7,322		20,498		21,474
Total capital expenditures	$	17,948	$	14,773	$	44,192	$	36,167


(in thousands)	September 30, 2024		December 31, 2023
On rent rental merchandise, net
Acima	$	602,303	$	606,912
Rent-A-Center	393,403		478,774
Mexico	21,010		24,210
Total on rent rental merchandise, net	$	1,016,716	$	1,109,896


(in thousands)	September 30, 2024		December 31, 2023
Held for rent rental merchandise, net
Acima	$	176	$	498
Rent-A-Center	112,824		112,129
Mexico	10,055		11,540
Total held for rent rental merchandise, net	$	123,055	$	124,167


(in thousands)	September 30, 2024		December 31, 2023
Assets by segment
Acima	$	1,209,699	$	1,221,845
Rent-A-Center	925,929		1,061,107
Mexico	56,424		57,347
Franchising	20,412		18,023
Total operating segments	2,212,464		2,358,322
Corporate	366,026		363,108
Total assets	$	2,578,490	$	2,721,430

Senior Debt (Tables)

9 Months Ended

Sep. 30, 2024

Debt Disclosure [Abstract]

Schedule of Maturities of Long-term Debt

The table below shows the scheduled maturity dates of our outstanding senior debt at September 30, 2024 for each of the years ending December 31:


(in thousands)	Term Loan Facility(1)		Total
2024	$	—	$	—
2025	—		—
2026	—		—
2027	—		—
2028	804,521		804,521
Thereafter	—		—
Total senior debt	$	804,521	$	804,521

(1) Annual installment requirements were reduced by the amount of the excess cash flow payment described above, in accordance with the terms of the credit agreement governing the Term Loan Facility.

Basis of Presentation	9 Months Ended
Basis of Presentation	Sep. 30, 2024
Basis of Presentation [Abstract]
Basis of Presentation	Basis of Presentation The interim condensed consolidated financial statements of Upbound Group, Inc. included herein have been prepared by us pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) have been condensed or omitted pursuant to the SEC’s rules and regulations, although we believe the disclosures are adequate to make the information presented not misleading. We suggest these financial statements be read in conjunction with the financial statements and notes included in our Annual Report on Form 10-K for the year ended December 31, 2023. In our opinion, the accompanying unaudited interim financial statements contain all adjustments, consisting only of those of a normal recurring nature, necessary to present fairly our results of operations and cash flows for the periods presented. The results of operations for the periods presented are not necessarily indicative of the results to be expected for the full year. Use of Estimates In preparing financial statements in conformity with U.S. generally accepted accounting principles, we are required to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent losses and liabilities at the date of the condensed consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. In applying accounting principles, we must often make individual estimates and assumptions regarding expected outcomes or uncertainties. Our estimates, judgments and assumptions are continually evaluated based on available information and experience. However, uncertainties, including those related to recent macroeconomic trends or other factors, may affect certain estimates and assumptions inherent in the financial reporting process, which may impact reported amounts of assets and liabilities in future periods and cause actual results to differ from those estimates. Principles of Consolidation and Nature of Operations The financial statements included herein include the accounts of Upbound Group, Inc. and its direct and indirect subsidiaries. All intercompany accounts and transactions have been eliminated. Unless the context indicates otherwise, references to “Upbound Group, Inc.” refer only to Upbound Group, Inc., the parent, and references to the “Company”, “we,” “us” and “our” refer to the consolidated business operations of Upbound Group and any or all of its direct and indirect subsidiaries. We report four operating segments: Acima, Rent-A-Center, Mexico, and Franchising. Our Acima segment, which primarily operates in the United States and Puerto Rico, includes the operations of Acima Holdings and certain locations previously operating under our Acceptance Now brand and generally offers consumers who do not qualify for traditional financing the lease-to-own transaction through staffed or unstaffed kiosks located within third-party retailer locations or other virtual options. In virtual locations, customers, either directly or with the assistance of a representative of the third-party retailer, initiate the lease-to-own transaction online in the retailers’ locations using our virtual solutions. Our Rent-A-Center segment consists of company-owned lease-to-own stores in the United States and Puerto Rico that lease household durable goods to customers through lease purchase agreements. We also offer merchandise on an installment sales basis in certain of our stores under the names “Get It Now” and “Home Choice” in Minnesota and Wisconsin. Our Rent-A-Center segment operates through our company-owned stores and e-commerce platforms through rentacenter.com, getitnowstores.com and homechoicestores.com. Our Mexico segment consists of our company-owned stores in Mexico that lease household durable goods to customers on a lease-to-own basis. Rent-A-Center Franchising International, Inc., an indirect wholly-owned subsidiary of Upbound Group, Inc., is a franchisor of lease-to-own stores. Our Franchising segment’s primary source of revenue is the sale of rental merchandise to our franchisees, who in turn offer the merchandise to the general public for rent or purchase under a lease-to-own transaction. The balance of our Franchising segment’s revenue is generated primarily from royalties based on franchisees’ monthly gross revenues. Newly Adopted Accounting Pronouncements In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which requires enhanced disclosures of significant segment expenses on a quarterly and annual basis and is intended to improve the transparency of reportable segment disclosures. Adoption of ASU 2023-07 was required for us beginning January 1, 2024 for our Annual Report on Form 10-K for the year ended December 31, 2024 and interim periods beginning in 2025. We will include required disclosures updates beginning with our Annual Report on Form 10-K for fiscal year ended December 31, 2024 using a retrospective approach.

Contingencies (Details) $ in Millions	Sep. 30, 2024 USD ($)
Commitments and Contingencies Disclosure [Abstract]
Commitments and contingencies, indemnity holdback	$ 45
Escrowed indemnity amount	$ 50

Receivables and Allowance for Doubtful Accounts (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Dec. 31, 2023
Receivables [Line Items]
Interest paid on installment agreements	$ 7,900	$ 8,700
Gross receivables	135,418		$ 125,259
Total receivables, net of allowance for doubtful accounts	121,645		111,005
Accounts Receivable, Allowance for Credit Loss [Roll Forward]
Less allowance for doubtful accounts	(13,773)		(14,254)
Bad debt expense	14,968
Accounts written off, net of recoveries	(15,449)
Installment sales receivable [Member]
Receivables [Line Items]
Gross receivables	58,566		62,901
Accounts Receivable, Allowance for Credit Loss [Roll Forward]
Less allowance for doubtful accounts	(12,300)		(13,000)
Trade and notes receivables [Member]
Receivables [Line Items]
Gross receivables	76,852		62,358
Accrued Revenue	44,300		36,800
Accounts Receivable, Allowance for Credit Loss [Roll Forward]
Less allowance for doubtful accounts	$ (1,500)		$ (1,200)

Segment Information (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
Segment Information (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023	Dec. 31, 2023
Segment Reporting Information [Line Items]
Total revenues	$ 1,068,859	$ 979,098	$ 3,241,336	$ 2,974,322
Gross profit	511,086	497,166	1,572,113	1,509,656
Operating profit (Ioss)	70,059	58,052	212,476	106,970
Depreciation and amortization	12,770	12,624	38,861	38,102
Capital expenditures	17,948	14,773	44,192	36,167
On rent	1,016,716		1,016,716		$ 1,109,896
Held for rent	123,055		123,055		124,167
Assets	2,578,490		2,578,490		2,721,430
Stock-based compensation expense			27,563	146,724
Other gains and charges	28,148	29,057	79,866	184,413
Depreciation [Member]
Segment Reporting Information [Line Items]
Other gains and charges	4,000	8,600	18,000	16,500
Acima Holdings [Member] \| Acima acquired assets amortization [Member]
Segment Reporting Information [Line Items]
Other gains and charges	10,900	14,300	34,500	42,800
Acima Holdings [Member] \| Acima equity consideration vesting
Segment Reporting Information [Line Items]
Other gains and charges	0	9,379	4,893	128,128
Operating segments [Member]
Segment Reporting Information [Line Items]
Operating profit (Ioss)	138,145	126,551	413,002	403,437
Depreciation and amortization	6,000	5,222	17,248	16,217
Capital expenditures	10,534	7,451	23,694	14,693
Assets	2,212,464		2,212,464		2,358,322
Operating segments [Member] \| Acima [Member]
Segment Reporting Information [Line Items]
Total revenues	566,183	475,216	1,680,323	1,423,421
Gross profit	173,969	159,427	522,882	474,258
Operating profit (Ioss)	63,994	58,124	185,896	175,103
Depreciation and amortization	352	420	1,024	1,263
Capital expenditures	246	121	1,454	203
On rent	602,303		602,303		606,912
Held for rent	176		176		498
Assets	1,209,699		1,209,699		1,221,845
Operating segments [Member] \| Rent-A-Center [Member]
Segment Reporting Information [Line Items]
Total revenues	458,743	453,632	1,419,399	1,404,831
Gross profit	316,750	317,233	984,898	975,210
Operating profit (Ioss)	68,923	63,762	210,730	211,637
Depreciation and amortization	5,207	4,421	14,977	13,964
Capital expenditures	10,089	6,822	20,543	12,587
On rent	393,403		393,403		478,774
Held for rent	112,824		112,824		112,129
Assets	925,929		925,929		1,061,107
Operating segments [Member] \| Mexico [Member]
Segment Reporting Information [Line Items]
Total revenues	19,030	19,642	60,465	55,526
Gross profit	13,714	13,971	43,441	39,410
Operating profit (Ioss)	884	1,124	4,139	3,417
Depreciation and amortization	405	345	1,139	880
Capital expenditures	199	508	1,697	1,902
On rent	21,010		21,010		24,210
Held for rent	10,055		10,055		11,540
Assets	56,424		56,424		57,347
Operating segments [Member] \| Franchising [Member]
Segment Reporting Information [Line Items]
Total revenues	24,903	30,608	81,149	90,544
Gross profit	6,653	6,535	20,892	20,778
Operating profit (Ioss)	4,344	3,541	12,237	13,280
Depreciation and amortization	36	36	108	110
Capital expenditures	0	0	0	1
Assets	20,412		20,412		18,023
Corporate, non-segment [Member]
Segment Reporting Information [Line Items]
Operating profit (Ioss)	(68,086)	(68,499)	(200,526)	(296,467)
Depreciation and amortization	6,770	7,402	21,613	21,885
Capital expenditures	7,414	$ 7,322	20,498	$ 21,474
Assets	$ 366,026		$ 366,026		$ 363,108

Fair Value (Tables)

9 Months Ended

Sep. 30, 2024

Fair Value Disclosures [Abstract]

Fair Value Measurements

The fair value of our Notes is based on Level 1 inputs and was as follows at September 30, 2024:


	September 30, 2024
(in thousands)	Carrying Value		Fair Value		Difference
Senior notes	$	450,000	$	434,250	$	(15,750)

Receivables and Allowance for Doubtful Accounts

9 Months Ended

Sep. 30, 2024

Receivables and Allowance for Doubtful Accounts [Abstract]

Receivables and Allowance for Doubtful Accounts

Installment sales receivables consist primarily of receivables due from customers for the sale of merchandise in our retail installment stores. Installment sales receivables associated with the sale of merchandise at our Get It Now and Home Choice stores generally consist of the sales price of the merchandise purchased and any additional fees for optional services the customer has chosen, less the customer’s down payment. No interest is accrued and interest income is recognized each time a customer makes a payment, generally on a monthly basis. Interest payments received on installment agreements for each of the nine months ended September 30, 2024 and 2023 were $7.9 million and $8.7 million, respectively.

Trade and notes receivables consist of amounts due from our lease-to-own customers for lease renewal payments and past due uncollected lease payments, adjusted for the probability of collection based on our assessment of historical collection rates and length of time the receivable is past due; amounts owed from our franchisees for inventory purchases, earned royalties and other obligations; and other corporate related receivables. Credit is extended to franchisees based on an evaluation of each franchisee’s financial condition and collateral is generally not required. Trade receivables are generally due within 30 days.

Receivables consist of the following:


(in thousands)	September 30, 2024		December 31, 2023
Installment sales receivables	$	58,566	$	62,901
Trade and notes receivables(1)	76,852		62,358

Total receivables	135,418		125,259
Less allowance for doubtful accounts(2)	(13,773)		(14,254)
Total receivables, net of allowance for doubtful accounts	$	121,645	$	111,005

(1) Trade and notes receivables includes accrued revenue, adjusted for the probability of collection, related to our lease-to-own agreements of $44.3 million and $36.8 million at September 30, 2024 and December 31, 2023, respectively.

(2) Lease receivables are accrued on a net basis, adjusted for the probability of collection based on our assessment of historical collection rates, as described above. Therefore, we do not maintain a separate allowance for doubtful accounts related to our lease receivables.

We have established an allowance for doubtful accounts for our installment notes receivable. Our policy for determining the allowance is primarily based on historical loss experience, as well as the results of management’s review and analysis of the payment and collection of the installment notes receivable within the previous year. We believe our allowance is adequate to absorb all expected losses. Our policy is to charge off installment notes receivable that are 120 days or more past due. Charge-offs are applied as a reduction to the allowance for doubtful accounts and any recoveries of previously charged off balances are recognized as contra-bad debt expense in our Condensed Consolidated Statements of Operations.

The allowance for our Franchising trade and notes receivables is determined by considering a number of factors, including the length of time receivables are past due, previous loss history, the franchisee’s current ability to pay its obligation, and the condition of the general economy and the industry as a whole. Trade receivables that are more than 90 days past due are either written-off or fully reserved in our allowance for doubtful accounts. Payments subsequently received on such receivables are recognized as contra-bad debt expense in our Condensed Consolidated Statements of Operations.

The allowance for doubtful accounts related to Franchising trade and notes receivables was $1.5 million and $1.2 million at September 30, 2024 and December 31, 2023, respectively, and the allowance for doubtful accounts related to installment sales receivables was $12.3 million and $13.0 million at September 30, 2024 and December 31, 2023, respectively.

Changes in our allowance for doubtful accounts are as follows:


(in thousands)	September 30, 2024
Beginning allowance for doubtful accounts	$	14,254
Bad debt expense(1)	14,968

Accounts written off, net of recoveries	(15,449)
Ending allowance for doubtful accounts	$	13,773

(1) Uncollectible installment payments, franchisee obligations, and other corporate receivables are recognized in non-labor operating expenses in our condensed consolidated financial statements.

Earnings Per Common Share (Tables)

9 Months Ended

Sep. 30, 2024

Earnings Per Share [Abstract]

Earnings Per Common Share

Summarized basic and diluted earnings per common share were calculated as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands, except per share data)	2024		2023		2024		2023
Numerator:
Net earnings	$	30,860	$	4,363	$	92,496	$	6,075
Denominator:
Weighted-average shares outstanding	54,700		55,485		54,631		55,294
Effect of dilutive stock awards(1)	1,262		1,367		1,242		1,373
Weighted-average dilutive shares	55,962		56,852		55,873		56,667

Basic earnings per common share	$	0.56	$	0.08	$	1.69	$	0.11
Diluted earnings per common share(1)	$	0.55	$	0.08	$	1.66	$	0.11
Anti-dilutive securities excluded from diluted earnings per common share:
Anti-dilutive restricted share units	—		43		1		43
Anti-dilutive performance share units	478		—		478		740
Anti-dilutive stock options	55		129		56		200

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended						9 Months Ended
Pay vs Performance Disclosure - USD ($) $ in Thousands	Sep. 30, 2024	Jun. 30, 2024	Mar. 31, 2024	Sep. 30, 2023	Jun. 30, 2023	Mar. 31, 2023	Sep. 30, 2024	Sep. 30, 2023
Pay vs Performance Disclosure
Net Income (Loss)	$ 30,860	$ 33,949	$ 27,687	$ 4,363	$ (45,618)	$ 47,330	$ 92,496	$ 6,075

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

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+ Details

Condensed Consolidated Statement of Comprehensive Income (Loss) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Statement of Comprehensive Income [Abstract]
Net earnings	$ 30,860	$ 4,363	$ 92,496	$ 6,075
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, Net of Tax	(2,540)	(2,729)	(5,703)	4,520
Total other comprehensive (loss) income	(2,540)	(2,729)	(5,703)	4,520
Comprehensive income	$ 28,320	$ 1,634	$ 86,793	$ 10,595

- Definition

Amount after tax of increase (decrease) in equity from transactions and other events and circumstances from net income and other comprehensive income, attributable to parent entity. Excludes changes in equity resulting from investments by owners and distributions to owners.

+ References + Details

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

+ Details

Condensed Consolidated Statement of Comprehensive Income (Loss) (Parenthetical) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Statement of Comprehensive Income [Abstract]
Foreign currency translation tax adjustment	$ (675)	$ (725)	$ (1,516)	$ 1,202

Basis of Presentation - Narrative (Details)	9 Months Ended
Basis of Presentation - Narrative (Details)	Sep. 30, 2024 segment
Basis of Presentation [Abstract]
Number of operating segments	4

Senior Debt (Details) - USD ($)					1 Months Ended	3 Months Ended		9 Months Ended
Senior Debt (Details) - USD ($)	Jun. 07, 2024	May 28, 2024	Sep. 21, 2021	Feb. 17, 2021	Mar. 31, 2023	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Senior Debt [Line Items]
Capitalized debt issuance costs				$ 30,200,000
Unamortized Debt Issuance Expense				25,300,000
Write-off of debt financing fees								$ 4,817,000	$ 0
Outstanding Senior debt						$ 804,521,000		804,521,000
Repayments of debt								291,563,000	134,229,000
Debt issuance costs								(5,186,000)	0
Debt refinancing charges						0	$ 0	(6,604,000)	$ 0
Original Issue Discount [Member]
Senior Debt [Line Items]
Unamortized Debt Issuance Expense						800,000		800,000
Debt Issuance Costs [Member]
Senior Debt [Line Items]
Unamortized Debt Issuance Expense						9,400,000		9,400,000
Term Loan Facility
Senior Debt [Line Items]
Capitalized debt issuance costs		$ 200,000
Term Loan Facility \| London Interbank Offered Rate (LIBOR) \| Minimum [Member]
Senior Debt [Line Items]
Basis margin on variable rate		2.75%
Term Loan Facility \| Secured Overnight Financing Rate (SOFR)
Senior Debt [Line Items]
Decrease to basis spread on variable rate		0.50%
Term Loan Facility \| Secured Overnight Financing Rate (SOFR) \| Maximum [Member]
Senior Debt [Line Items]
Basis margin on variable rate			3.25%
ABL credit facility [Member]
Senior Debt [Line Items]
Write-off of debt financing fees	$ 400,000
Debt issuance costs	$ (3,200,000)
Term Loan Facility
Senior Debt [Line Items]
Write-off of debt financing fees		$ 4,400,000
Debt issuance costs		(2,000,000)
Debt refinancing charges		$ (1,800,000)
Term Loan Facility
Senior Debt [Line Items]
Senior secured term loan facility				875,000,000
Available increase in Senior Debt capacity				500,000,000
Original issue discount				$ 4,400,000
Outstanding Senior debt						$ 804,521,000		$ 804,521,000
Debt instrument, maturity date				Feb. 17, 2028
Debt Instrument, Frequency of Periodic Payment								quarterly
Debt Instrument, Periodic Payment, Percent								1.00%
Repayments of debt					$ 42,600,000
Accrued interest					$ 600,000
Term Loan Facility \| Secured Overnight Financing Rate (SOFR)
Senior Debt [Line Items]
Basis margin on variable rate								2.75%
Actual interest rate						8.00%		8.00%
Term Loan Facility \| Secured Overnight Financing Rate (SOFR) Floor
Senior Debt [Line Items]
Basis margin on variable rate								0.50%
ABL credit facility [Member]
Senior Debt [Line Items]
Revolving credit facility commitments				$ 550,000,000
Available increase in Senior Debt capacity				125,000,000
Outstanding Senior debt						$ 0		$ 0
ABL credit facility borrowing capacity						494,400,000		494,400,000
Letters of credit, amount outstanding						55,600,000		$ 55,600,000
Debt instrument, maturity date	Jun. 07, 2029
Line of credit facility, unused capacity, commitment fee percentage								0.375%
Line of credit commitment fee						$ 700,000
ABL credit facility [Member] \| Maximum [Member]
Senior Debt [Line Items]
Line of credit facility, unused capacity, commitment fee percentage								0.375%
ABL credit facility [Member] \| Minimum [Member]
Senior Debt [Line Items]
Line of credit facility, unused capacity, commitment fee percentage								0.25%
ABL credit facility [Member] \| Secured Overnight Financing Rate (SOFR)
Senior Debt [Line Items]
Actual interest rate						7.35%		7.35%
ABL credit facility [Member] \| Secured Overnight Financing Rate (SOFR) \| Maximum [Member]
Senior Debt [Line Items]
Basis margin on variable rate								2.00%
ABL credit facility [Member] \| Secured Overnight Financing Rate (SOFR) \| Minimum [Member]
Senior Debt [Line Items]
Basis margin on variable rate								1.50%
ABL Letter of Credit
Senior Debt [Line Items]
Maximum borrowing capacity				$ 150,000,000

Document and Company Information - shares	9 Months Ended
Document and Company Information - shares	Sep. 30, 2024	Oct. 24, 2024
Document And Entity Information
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2024
Document Transition Report	false
Entity File Number	001-38047
Entity Registrant Name	Upbound Group, Inc.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	45-0491516
Entity Address, Address Line One	5501 Headquarters Drive
Entity Address, City or Town	Plano
Entity Address, State or Province	TX
Entity Address, Postal Zip Code	75024
City Area Code	972
Local Phone Number	801-1100
Title of 12(b) Security	Common stock, $.01 par value
Trading Symbol	UPBD
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		54,699,602
Entity Central Index Key	0000933036
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q3
Amendment Flag	false

Contingencies	9 Months Ended
Contingencies	Sep. 30, 2024
Commitments and Contingencies Disclosure [Abstract]
Contingencies	Contingencies We, along with our subsidiaries, are party to various legal proceedings and governmental inquiries and investigations given the nature of our business. We regularly monitor developments related to these matters, determine whether a reserve is appropriate if the loss is both probable and reasonably estimable, and review the adequacy of our reserves for such matters on a quarterly basis. As a result, we do not have reserves for all matters with respect to which we may or will have future liability, and no assurance can be given that our reserves, when recorded, will be adequate to cover the full amount of any loss we may ultimately incur. In addition, certain of the matters described below involve demands for monetary relief and changes to our business practices that could materially and adversely impact our business, financial condition and results of operations were we to agree to them as part of a settlement or be subject to them following an adverse result in litigation. We cannot predict the ultimate resolution of our pending legal proceedings and governmental inquiries and investigations or other similar matters that may arise in the future given the nature of our business and the inherent uncertainty associated with legal proceedings and governmental inquiries and investigations, including those described below. We have incurred legal and related expenses, and we expect to incur substantial additional legal and related expenses, associated with the litigation and investigations discussed below. Unclaimed Property. We are subject to unclaimed property audits by states in the ordinary course of business. The property subject to review in the audit process includes unclaimed wages, vendor payments and customer refunds. State escheat laws generally require entities to report and remit abandoned and unclaimed property to the state. Failure to timely report and remit the property can result in assessments that could include interest and penalties, in addition to the payment of the escheat liability itself. We routinely remit escheat payments to states and believe we are in compliance with applicable escheat laws. Consumer Financial Protection Bureau (“CFPB”) Litigation. In October 2020, prior to the December 2020 execution of the definitive agreement to acquire Acima, Acima received a Civil Investigative Demand (the “CID”) from the CFPB requesting certain information, documents and data relating to Acima’s products, services and practices from January 1, 2015 forward. The stated purpose of the CID was to determine whether Acima extends credit, offers leases, or otherwise offers or provides a consumer financial product or service and whether Acima complies with certain consumer financial protection laws. After the original CID, the CFPB issued subsequent CIDs requesting further information, documents and testimony. Acima responded to all CIDs and cooperated with the CFPB throughout their investigation. In May 2023, in accordance with the CFPB’s Notice and Opportunity to Respond and Advise (“NORA”) process, the CFPB staff notified Acima that the staff may recommend that the CFPB take legal action against Acima based on allegations that Acima violated the Consumer Financial Protection Act of 2010; the Truth in Lending Act and its implementing regulation, Regulation Z; the Electronic Fund Transfer Act and its implementing regulation, Regulation E; and the Fair Credit Reporting Act and its implementing regulation, Regulation V, and seek remedies including restitution, disgorgement, damages, injunctive relief, and civil money penalties. In June 2023, Acima submitted its response to the NORA notice. In the second quarter 2024, Acima was informed by the CFPB staff that the CFPB authorized “sue or settle” authority pursuant to the NORA process. The CFPB subsequently provided Acima with a settlement proposal. Although Acima engaged in discussions with the CFPB regarding its settlement demands, Acima’s efforts to negotiate a resolution were met with the CFPB’s threat of imminent commencement of litigation, refusal to meet with Acima in person to discuss a potential resolution, and what Acima believes were unsupportable demands. As a result, on July 22, 2024, Acima filed a lawsuit against the CFPB in the U.S. District Court for the Eastern District of Texas. Acima seeks to halt what it contends is the CFPB’s unauthorized attempt to expand its authority as limited by federal law and usurp the long-standing, comprehensive state regulatory framework governing the lease-to-own industry. Acima filed this action reluctantly, only after concluding in its judgment that the CFPB was not prepared to settle with Acima on acceptable terms. On July 26, 2024, the CFPB filed a lawsuit against Acima and its former founder in the U.S. District Court for the District of Utah, alleging violations of the consumer financial protection laws and regulations described above in connection with the CFPB’s May 2023 NORA notice. The CFPB’s lawsuit seeks injunctive relief, unspecified monetary relief and civil penalties and other relief. Both lawsuits remain pending. Acima will vigorously prosecute the lawsuit it filed and defend itself against the CFPB’s lawsuit. We cannot provide any assurance that Acima’s litigation against the CFPB will be successful or that Acima will be successful in defending against the CFPB’s litigation, and that the CFPB’s ongoing regulatory efforts will not lead to the imposition of financial and other relief, and/or require changes to Acima’s business practices or operations that could materially and adversely affect our business, financial condition, results of operations or reputation. In connection with our acquisition of Acima, $45 million of a $50 million initial holdback escrowed at the closing of the transaction remains available for fines, penalties or customer restitution paid in connection with a resolution of the CFPB matter, including an adverse litigation outcome. Although the CFPB’s complaint does not contain a specific monetary demand, the CFPB’s initial monetary settlement demand exceeded the remaining $45 million holdback by a substantial amount. Therefore, there can be no assurance that the remaining escrowed amount will be sufficient to address all covered losses that may ultimately be incurred for this matter. In addition, Acima has incurred and expects to continue to incur substantial legal and related expenses associated with this matter, which are not recoverable from the holdback amount. Multi-State Attorneys’ General Investigation. In November 2021, Acima received a letter from the Nebraska Attorney General’s office stating that the Attorney General of Nebraska, along with a coalition of thirty-eight state Attorneys General, initiated a multi-state investigation into the business acts and practices of Acima and that a civil investigative demand(s) and/or subpoena(s) pursuant to respective state consumer protection laws will be forthcoming. Since receiving the letter, we have held multiple discussions and attended meetings with officials at many of the applicable attorneys’ general offices including members of the Executive Committee, which is leading the negotiations on behalf of the multistate group (the “Multistate”). Based on our engagement with the Multistate, it is our understanding that the investigation involves forty states and the District of Columbia. In April 2022, we received a request for information and documents, and we have produced various records in response to the request. In March 2024, the Multistate presented their findings and allegations from their investigation to Acima. In May 2024, Acima submitted its response to the Multistate’s presentation. In the second quarter 2024, Acima received a settlement proposal from the Multistate. Since then, the parties have continued to engage in conversations regarding a potential resolution and Acima has responded to the Multistate’s initial settlement proposal and monetary demand. As of the date of this Quarterly Report on Form 10-Q, although we would not be willing to agree to the Multistate’s monetary demand which we believe is unsupportable or agree to a number of the other terms presented by the Multistate, we expect to continue to discuss the potential resolution of this matter. We are currently unable to predict whether or on what terms, including the amount of a monetary payment and the nature of business practice changes, any settlement with the Multistate, or individual members of the group, can be achieved. If we are unable to reach agreement on terms acceptable to us and to the various states involved in the group, some or all of such states may commence legal proceedings against Acima. We cannot provide any assurance that any settlement or adverse result in litigation will not require a monetary payment and/or changes to Acima’s business practices or operations that could materially and adversely affect our business, financial condition, results of operations or reputation. New York Attorney General Litigation. The New York Attorney General (the “NYAG”) issued a subpoena to our Acima subsidiary in January 2020, prior to our acquisition of Acima, seeking information with respect to various business practices in connection with Acima’s lease-to-own transactions. Acima received additional subpoenas from the NYAG in August 2021 and July 2023. Acima cooperated with the NYAG throughout its investigation. In March 2023, the NYAG provided Acima with a proposed assurance of discontinuance alleging violations of certain consumer laws, seeking injunctive relief regarding certain business practices, and seeking payment of unspecified amounts for restitution and civil penalties. In April 2023, Acima submitted its response to the NYAG’s proposed assurance of discontinuance. In February 2024, Acima provided a settlement proposal to the NYAG. In March 2024, the NYAG presented Acima with an initial monetary demand for settlement purposes. On August 14, 2024, despite Acima’s cooperation with the investigation and its active engagement in settlement discussions with the NYAG, the NYAG filed a lawsuit against Acima in the Supreme Court of the State of New York, County of New York. The lawsuit alleges violations of various consumer financial protection laws and regulations similar to those set forth in the NYAG’s March 2023 proposed assurance of discontinuance. The lawsuit seeks injunctive relief, unspecified monetary relief and civil penalties and other relief. Acima will vigorously defend itself against the NYAG’s lawsuit. We cannot provide any assurance that Acima will be successful in defending against the NYAG’s litigation or that an adverse result in litigation will not require a monetary payment and/or changes to Acima’s business practices or operations that could materially and adversely affect our business, financial condition, results of operations or reputation. McBurnie Litigation. We are a defendant in a putative class action entitled McBurnie, et al. v. Acceptance Now, LLC, brought on behalf of individuals who entered into a rental purchase agreement with the Company’s Acceptance Now business in California and were charged a processing fee and/or an expedited fee. Plaintiffs allege that the fees they were charged were neither “reasonable” nor “actually incurred” in violation of the Karnette Rental-Purchase Act and other California state consumer protection laws. Plaintiffs seek unspecified actual damages pursuant to the Karnette Rental-Purchase Act; statutory damages pursuant to the Karnette Rental-Purchase Act; attorneys’ fees and costs; exemplary damages; and public injunctions for alleged violations of the Karnette Rental-Purchase Act, the California Consumers Legal Remedies Act, and California unfair competition laws. The action is currently pending in the United States District Court for the Northern District of California. In November 2022, the District Court denied our motion to compel arbitration, and in December 2022, we filed an interlocutory appeal of that denial with the United States Court of Appeals for the Ninth Circuit, pending which the District Court proceedings were stayed. In March 2024, the Court of Appeals affirmed the District Court’s denial of our motion to compel arbitration and its finding that plaintiffs’ challenge to the processing fee was not moot, while remanding the action to the District Court to consider whether plaintiffs have standing to challenge the expedited payment fee. Plaintiffs have since notified the District Court that they do not intend to pursue their claims regarding the expedited payment fee. In June 2024, we filed a petition for certiorari with the U.S. Supreme Court, appealing the decision from the Court of Appeals. Our petition for certiorari was denied by the Supreme Court in October 2024. At the same time, proceedings before the District Court have resumed. Under the current scheduling order, this matter is scheduled for trial in October 2025. We will continue to vigorously defend this case. We are currently unable to predict the eventual outcome of this litigation. FlexShopper Litigation. On September 30, 2024, FlexShopper, Inc. (“FlexShopper”) filed a patent infringement lawsuit against Upbound Group, Inc, Acima Holdings, LLC and Acima Digital, LLC in the United States District Court for the Eastern District of Texas. On October 1, 2024, FlexShopper issued a press release announcing the lawsuit and a similar lawsuit it filed against another lease-to-own company, Katapult Holdings, Inc. The lawsuit filed against our company seeks damages and an injunction for alleged violations of five patents assigned to FlexShopper with respect to certain online lease-to-own transactions in connection with Acima’s e-commerce third-party retailer lease-to-own business. We will vigorously defend the lawsuit. We are currently unable to predict the eventual timing or outcome of this litigation.

Fair Value

9 Months Ended

Sep. 30, 2024

Fair Value Disclosures [Abstract]

Fair Value

We follow a three-tier fair value hierarchy, which classifies the inputs used in measuring fair values, in determining the fair value of our non-financial assets and non-financial liabilities, which consist primarily of goodwill. These tiers include: Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.

Our financial instruments include cash and cash equivalents, receivables, payables, borrowings against our ABL Credit Facility and Term Loan Facility, and outstanding Notes. The carrying amount of cash and cash equivalents, receivables and payables approximates fair value at September 30, 2024 and December 31, 2023, because of the short maturities of these instruments. In addition, the interest rates on our Term Loan Facility and ABL Credit Facility are variable and, therefore, we believe the carrying value of outstanding borrowings approximates their fair value.

The fair value of our Notes is based on Level 1 inputs and was as follows at September 30, 2024:


	September 30, 2024
(in thousands)	Carrying Value		Fair Value		Difference
Senior notes	$	450,000	$	434,250	$	(15,750)

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References

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+ Details

Insider Trading Arrangements	3 Months Ended
Insider Trading Arrangements	Sep. 30, 2024
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

Condensed Consolidated Statements of Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock	Additional Paid-in Capital	Retained Earnings	Treasury Stock	Accumulated Other Comprehensive (Loss) Income
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Common stock, shares, outstanding		125,028
Total stockholders' equity	$ 525,146	$ 1,080	$ 1,298,094	$ 1,077,189	$ (1,840,591)	$ (10,626)
Net earnings	47,330			47,330
Total other comprehensive (loss) income	3,104					3,104
Exercise of stock options, shares		55
Exercise of stock options	684	$ 1	683
Vesting of restricted share units, net of shares withheld for employee taxes, shares		204
Vesting of restricted share units, net of shares withheld for employee taxes	0	$ 31	(31)
Tax effect of stock awards vested and options exercised	(2,535)		(2,535)
Stock-based compensation	115,681		115,681
Dividends declared	(19,068)			(19,068)
Net earnings	6,075
Total other comprehensive (loss) income	4,520
Common stock, shares, outstanding		125,287
Total stockholders' equity	670,342	$ 1,112	1,411,892	1,105,451	(1,840,591)	(7,522)
Net earnings	(45,618)			(45,618)
Total other comprehensive (loss) income	4,145					4,145
Exercise of stock options, shares		19
Exercise of stock options	371	$ 0	371
Vesting of restricted share units, net of shares withheld for employee taxes, shares		2
Vesting of restricted share units, net of shares withheld for employee taxes	0	$ 1	(1)
Stock-based compensation	15,425		15,425
Dividends declared	(19,072)			(19,072)
Common stock, shares, outstanding		125,308
Total stockholders' equity	625,593	$ 1,113	1,427,687	1,040,761	(1,840,591)	(3,377)
Net earnings	4,363			4,363
Total other comprehensive (loss) income	(2,729)					(2,729)
Purchase of treasury stock	(27,151)	$ (9)			(27,142)
Exercise of stock options, shares		27
Exercise of stock options	463	$ 0	463
Vesting of restricted share units, net of shares withheld for employee taxes, shares		19
Vesting of restricted share units, net of shares withheld for employee taxes	0	$ 4	(4)
Tax effect of stock awards vested and options exercised	(97)		(97)
Stock-based compensation	15,618		15,618
Dividends declared	(18,815)			(18,815)
Common stock, shares, outstanding		125,354
Total stockholders' equity	597,245	$ 1,108	1,443,667	1,026,309	(1,867,733)	(6,106)
Common stock, shares, outstanding		125,415
Total stockholders' equity	560,372	$ 1,100	1,459,709	994,892	(1,890,966)	(4,363)
Net earnings	27,687			27,687
Total other comprehensive (loss) income	676					676
Exercise of stock options, shares		35
Exercise of stock options	855	$ 0	855
Vesting of restricted share units, net of shares withheld for employee taxes, shares		234
Vesting of restricted share units, net of shares withheld for employee taxes	0	$ 6	(6)
Tax effect of stock awards vested and options exercised	(2,978)		(2,978)
Stock-based compensation	11,940		11,940
Dividends declared	(20,257)			(20,257)
Net earnings	92,496
Total other comprehensive (loss) income	(5,703)
Common stock, shares, outstanding		125,684
Total stockholders' equity	578,295	$ 1,106	1,469,520	1,002,322	(1,890,966)	(3,687)
Net earnings	33,949			33,949
Total other comprehensive (loss) income	(3,839)					(3,839)
Exercise of stock options, shares		9
Exercise of stock options	194	$ 0	194
Vesting of restricted share units, net of shares withheld for employee taxes, shares		23
Vesting of restricted share units, net of shares withheld for employee taxes	0	$ 1	(1)
Tax effect of stock awards vested and options exercised	(76)		(76)
Stock-based compensation	8,048		8,048
Dividends declared	(20,270)			(20,270)
Common stock, shares, outstanding		125,716
Total stockholders' equity	596,301	$ 1,107	1,477,685	1,016,001	(1,890,966)	(7,526)
Net earnings	30,860			30,860
Total other comprehensive (loss) income	(2,540)					(2,540)
Exercise of stock options, shares		12
Exercise of stock options	274	$ 0	274
Vesting of restricted share units, net of shares withheld for employee taxes, shares		29
Vesting of restricted share units, net of shares withheld for employee taxes	0	$ 0	0
Tax effect of stock awards vested and options exercised	(369)		(369)
Stock-based compensation	7,575		7,575
Dividends declared	(20,281)			(20,281)
Common stock, shares, outstanding		125,757
Total stockholders' equity	$ 611,820	$ 1,107	$ 1,485,165	$ 1,026,580	$ (1,890,966)	$ (10,066)

Earnings Per Common Share (Details) - USD ($) $ / shares in Units, $ in Thousands		3 Months Ended						9 Months Ended
	Feb. 17, 2021	Sep. 30, 2024	Jun. 30, 2024	Mar. 31, 2024	Sep. 30, 2023	Jun. 30, 2023	Mar. 31, 2023	Sep. 30, 2024	Sep. 30, 2023
Earnings Per Common Share
Net earnings		$ 30,860	$ 33,949	$ 27,687	$ 4,363	$ (45,618)	$ 47,330	$ 92,496	$ 6,075
Weighted-average shares outstanding		54,700,000			55,485,000			54,631,000	55,294,000
Effect of dilutive stock awards		1,262,000			1,367,000			1,242,000	1,373,000
Weighted-average dilutive shares		55,962,000			56,852,000			55,873,000	56,667,000
Basic earnings per common share		$ 0.56			$ 0.08			$ 1.69	$ 0.11
Diluted earnings per common share(1)		$ 0.55			$ 0.08			$ 1.66	$ 0.11
Acima Holdings [Member]
Earnings Per Common Share
Stock consideration, shares	10,779,923
Acima Holdings [Member] \| Restricted share units [Member]
Earnings Per Common Share
Weighted-average dilutive shares									400,000
Stock consideration, shares	8,096,595
Restricted share units [Member] \| Acima Holdings [Member]
Earnings Per Common Share
Stock consideration, shares	8,096,595
Retained Earnings
Earnings Per Common Share
Net earnings		$ 30,860	$ 33,949	$ 27,687	$ 4,363	$ (45,618)	$ 47,330
Restricted Stock Units [Member]
Earnings Per Common Share
Anti-dilutive securities		0			43,000			1,000	43,000
Performance-based restricted stock units [Member]
Earnings Per Common Share
Anti-dilutive securities		478,000			0			478,000	740,000
Stock options [Member]
Earnings Per Common Share
Anti-dilutive securities		55,000			129,000			56,000	200,000

Income Taxes (Details)	9 Months Ended
Income Taxes (Details)	Sep. 30, 2024	Sep. 30, 2023
Income Tax Disclosure [Abstract]
Effective tax rate	24.90%	76.10%
Goodwill amortization period	15 years

Divestitures (Details) - Rent-A-Center Divestiture - Disposal Group, Disposed of by Sale, Not Discontinued Operations $ in Millions		9 Months Ended
	Sep. 09, 2024 USD ($) store	Sep. 30, 2024 USD ($)
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Number of store sold \| store	55
Cash consideration on refranchise sale	$ 19.1
Franchise fees on refranchise sale	0.6
On-rent and held for rent inventory on refranchise sale	13.0
Property assets on refranchise sale	2.0
Prorated rent and other miscellaneous expenses on refranchise sale	$ 0.4
Net gain on refranchise sale		$ 3.1

Condensed Consolidated Statements of Operations - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Revenues
Rentals and fees	$ 877,831	$ 806,766	$ 2,636,347	$ 2,421,039
Merchandise sales	150,752	127,564	476,690	415,256
Installment sales	14,416	13,444	44,333	45,191
Franchise merchandise sales	18,195	24,082	60,136	69,778
Royalty income and fees	5,863	5,813	18,539	18,636
Other	1,802	1,429	5,291	4,422
Total revenues	1,068,859	979,098	3,241,336	2,974,322
Cost of revenues
Cost of rentals and fees	342,392	296,820	1,008,094	885,662
Cost of merchandise sold	191,875	155,937	584,816	492,879
Cost of installment sales	5,256	5,102	16,056	16,359
Franchise cost of merchandise sold	18,250	24,073	60,257	69,766
Total cost of revenues	557,773	481,932	1,669,223	1,464,666
Gross profit	511,086	497,166	1,572,113	1,509,656
Operating expenses
Operating labor	152,635	152,080	466,952	460,470
Non-labor operating expenses	196,010	191,455	613,757	569,267
General and administrative expenses	51,464	53,898	160,201	150,434
Depreciation and amortization	12,770	12,624	38,861	38,102
Other gains and charges	28,148	29,057	79,866	184,413
Total operating expenses	441,027	439,114	1,359,637	1,402,686
Operating profit	70,059	58,052	212,476	106,970
Debt refinancing charges	0	0	6,604	0
Interest expense	26,801	27,887	85,163	84,233
Interest income	(897)	(1,255)	(2,453)	(2,690)
Earnings before income taxes	44,155	31,420	123,162	25,427
Income tax expense	13,295	27,057	30,666	19,352
Net earnings	$ 30,860	$ 4,363	$ 92,496	$ 6,075
Basic earnings per common share	$ 0.56	$ 0.08	$ 1.69	$ 0.11
Diluted earnings per common share	0.55	0.08	1.66	0.11
Cash dividends declared per common share	$ 0.37	$ 0.34	$ 1.11	$ 1.02

Common Stock and Stock-Based Compensation (Details) - USD ($) $ / shares in Units, $ in Thousands		3 Months Ended		9 Months Ended
	Feb. 17, 2021	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Purchase of treasury stock			$ 27,151
Stock-based compensation expense				$ 27,563	$ 146,724
Other gains and charges		$ 28,148	29,057	79,866	184,413
Total revenues		1,068,859	979,098	3,241,336	2,974,322
Accelerated stock compensation
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Other gains and charges		1,688	0	$ 3,421	$ 0
Share Repurchase 500 Million
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares repurchased (in shares)				0	916,269
Purchase of treasury stock					$ 27,100
Stock repurchase program, authorized amount		500,000		$ 500,000
Remaining Authorized Repurchase Amount		235,000		235,000
Acima Holdings [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock consideration, shares	10,779,923
Common stock price (in dollars per share)	$ 51.14
Share-Based Payment Arrangement, Accelerated Cost					78,400
Acima Holdings [Member] \| Acima equity consideration vesting
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Other gains and charges		0	9,379	4,893	128,128
Acima Holdings [Member] \| Share-based Payment Arrangement [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock consideration, shares	2,683,328
2021 and 2016 Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense		$ 5,900	$ 6,200	$ 19,300	$ 18,600
Restricted Stock Units [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Time-vesting restricted stock units granted (in shares)				284,702
Weighted average grant date fair value of restricted stock units granted (in dollars per share)				$ 33.69
Performance-based restricted stock units [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Performance-based restricted stock units granted (in shares)				496,803
Weighted average grant date fair value of restricted stock units granted (in dollars per share)				$ 38.40
Restricted share units [Member] \| Acima Holdings [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock consideration, shares	8,096,595
Stock consideration, value	$ 414,100

Senior Debt (Details)	Sep. 30, 2024 USD ($)
Senior Debt [Line Items]
2024	$ 0
2025	0
2026	0
2027	0
2028	804,521,000
Thereafter	0
Outstanding Senior debt	804,521,000
ABL credit facility [Member]
Senior Debt [Line Items]
Outstanding Senior debt	0
Term Loan Facility
Senior Debt [Line Items]
2024	0
2025	0
2026	0
2027	0
2028	804,521,000
Thereafter	0
Outstanding Senior debt	$ 804,521,000

Income Taxes	9 Months Ended
Income Taxes	Sep. 30, 2024
Income Tax Disclosure [Abstract]
Income Tax	Income Taxes The effective tax rate was 24.9% for the nine months ended September 30, 2024, compared to 76.1% for the nine months ended September 30, 2023. The reduction in the effective tax rate for the nine months ended September 30, 2024 was primarily attributable to a lower tax impact of stock compensation expense related to stock consideration issued to the former owners of Acima Holdings in the form of restricted stock awards, compared to the prior year period. Please reference Note 9 for additional information regarding the recognition of these restricted stock awards in our condensed consolidated financial statements. For tax purposes, restricted stock awards subject to restricted stock agreements issued to the former owners of Acima Holdings were recorded as goodwill and are amortized over a period of 15 years from the date of acquisition.

- Definition

The entire disclosure for income tax.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482603/740-30-50-2

+ Details

Receivables and Allowance for Doubtful Accounts (Tables)

9 Months Ended

Sep. 30, 2024

Receivables and Allowance for Doubtful Accounts [Abstract]

Receivables

Receivables consist of the following:


(in thousands)	September 30, 2024		December 31, 2023
Installment sales receivables	$	58,566	$	62,901
Trade and notes receivables(1)	76,852		62,358

Total receivables	135,418		125,259
Less allowance for doubtful accounts(2)	(13,773)		(14,254)
Total receivables, net of allowance for doubtful accounts	$	121,645	$	111,005

Changes in Allowance for Doubtful Accounts

Changes in our allowance for doubtful accounts are as follows:


(in thousands)	September 30, 2024
Beginning allowance for doubtful accounts	$	14,254
Bad debt expense(1)	14,968

Accounts written off, net of recoveries	(15,449)
Ending allowance for doubtful accounts	$	13,773

(1) Uncollectible installment payments, franchisee obligations, and other corporate receivables are recognized in non-labor operating expenses in our condensed consolidated financial statements.

Senior Notes (Details) - USD ($) $ in Thousands		9 Months Ended
Senior Notes (Details) - USD ($) $ in Thousands	Feb. 17, 2021	Sep. 30, 2024
Senior Notes [Line Items]
Unamortized Debt Issuance Expense	$ 25,300
Senior Notes [Member]
Senior Notes [Line Items]
Carrying value of senior notes	$ 450,000	$ 450,000
Debt instrument, maturity date	Feb. 15, 2029
Interest rate, stated percentage	6.375%
Unamortized Debt Issuance Expense	$ 15,700	$ 8,600
Debt Instrument, Redemption Price, Percentage		101.00%

Fair Value (Details) - Senior Notes [Member] - USD ($) $ in Thousands	Sep. 30, 2024	Feb. 17, 2021
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Carrying value of senior notes	$ 450,000	$ 450,000
Fair value	434,250
Difference	$ (15,750)

- Definition

Fair value portion of debt instrument payable, including, but not limited to, notes payable and loans payable.

+ References

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-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482907/825-10-50-10

+ Details

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Cash flows from operating activities
Net earnings	$ 92,496	$ 6,075
Adjustments to reconcile net earnings to net cash provided by operating activities
Depreciation of rental merchandise	968,894	859,001
Bad debt expense	14,969	17,533
Stock-based compensation expense	27,563	146,724
Depreciation of property assets	56,227	53,894
(Gain) loss on sale or disposal of property assets	(2,289)	413
Amortization of intangibles	35,226	43,518
Amortization of financing fees	4,170	4,770
Write-off of debt financing fees	4,817	0
Deferred income taxes	(8,899)	(32,488)
Changes in operating assets and liabilities, net of acquired assets
Rental merchandise	(886,836)	(824,151)
Receivables	(24,109)	(10,441)
Prepaid expenses and other assets	(24,184)	(9,600)
Operating lease right-of-use assets and lease liabilities	4,279	385
Accounts payable – trade	(52,444)	(23,070)
Accrued liabilities	(43,214)	(12,621)
Net cash provided by operating activities	166,666	219,942
Cash flows from investing activities
Purchase of property assets	(44,192)	(36,167)
Proceeds from sale of assets	18,357	15
Promissory loan issuance	(1,500)	0
Acquisitions of businesses	0	(39)
Net cash used in investing activities	(27,335)	(36,191)
Cash flows from financing activities
Share repurchases	0	(24,049)
Exercise of stock options	1,324	1,518
Shares withheld for payment of employee tax withholdings	(3,424)	(2,632)
Debt issuance costs	(5,186)	0
Proceeds from debt	215,000	0
Repayments of debt	291,563	134,229
Dividends paid	(62,018)	(64,366)
Net cash used in financing activities	(145,867)	(223,758)
Effect of exchange rate changes on cash	(2,115)	1,592
Net decrease in cash and cash equivalents	(8,651)	(38,415)
Cash and cash equivalents at beginning of period	93,705	144,141
Cash and cash equivalents at end of period	$ 85,054	$ 105,726

Revenues (Tables)

9 Months Ended

Sep. 30, 2024

Revenues [Abstract]

Disaggregation of Revenue

The following tables disaggregate our revenue for the periods ended September 30, 2024 and 2023:


	Three Months Ended September 30, 2024
	Acima		Rent-A-Center		Mexico		Franchising		Consolidated
(in thousands)
Rentals and fees	$	442,463	$	417,327	$	18,041	$	—	$	877,831
Merchandise sales	123,299		26,707		746		—		150,752
Installment sales	—		14,416		—		—		14,416
Franchise merchandise sales	—		—		—		18,195		18,195
Royalty income and fees	—		—		—		5,863		5,863
Other	421		293		243		845		1,802
Total revenues	$	566,183	$	458,743	$	19,030	$	24,903	$	1,068,859



	Nine Months Ended September 30, 2024
	Acima		Rent-A-Center		Mexico		Franchising		Consolidated
(in thousands)
Rentals and fees	$	1,301,874	$	1,277,477	$	56,996	$	—	$	2,636,347
Merchandise sales	377,389		96,701		2,600		—		476,690
Installment sales	—		44,333		—		—		44,333
Franchise merchandise sales	—		—		—		60,136		60,136
Royalty income and fees	—		—		—		18,539		18,539
Other	1,060		888		869		2,474		5,291
Total revenues	$	1,680,323	$	1,419,399	$	60,465	$	81,149	$	3,241,336


	Three Months Ended September 30, 2023
	Acima		Rent-A-Center		Mexico		Franchising		Consolidated
(in thousands)
Rentals and fees	$	375,202	$	413,051	$	18,513	$	—	$	806,766
Merchandise sales	99,857		26,819		888		—		127,564
Installment sales	—		13,444		—		—		13,444
Franchise merchandise sales	—		—		—		24,082		24,082
Royalty income and fees	—		—		—		5,813		5,813
Other	157		318		241		713		1,429
Total revenues	$	475,216	$	453,632	$	19,642	$	30,608	$	979,098



	Nine Months Ended September 30, 2023
	Acima		Rent-A-Center		Mexico		Franchising		Consolidated
(in thousands)
Rentals and fees	$	1,107,943	$	1,260,745	$	52,351	$	—	$	2,421,039
Merchandise sales	314,741		97,905		2,610		—		415,256
Installment sales	—		45,191		—		—		45,191
Franchise merchandise sales	—		—		—		69,778		69,778
Royalty income and fees	—		—		—		18,636		18,636
Other	737		990		565		2,130		4,422
Total revenues	$	1,423,421	$	1,404,831	$	55,526	$	90,544	$	2,974,322

Common Stock and Stock-Based Compensation	9 Months Ended
Common Stock and Stock-Based Compensation	Sep. 30, 2024
Stock-Based Compensation [Abstract]
Common Stock and Stock-Based Compensation	Common Stock and Stock-Based Compensation Stock Repurchase Program In early December 2021, our Board of Directors authorized a stock repurchase program for up to $500 million (the “December 2021 Program”), which superseded our previous stock repurchase program. Under the December 2021 Program, we may purchase shares of our common stock from time to time in the open market or privately negotiated transactions. We are not obligated to acquire any shares under the program, and the program may be suspended or discontinued at any time. There were no repurchases of our common stock during the nine months ended September 30, 2024. During the nine months ended September 30, 2023, we repurchased 916,269 shares of our common stock for an aggregate purchase price of approximately $27.1 million. Approximately $235.0 million remains available for repurchases under the current authorization at September 30, 2024. Stock Based Compensation We recognized $5.9 million and $6.2 million in compensation expense related to stock awards issued under the Upbound Group, Inc. Amended 2021 Long-Term Incentive Plan (the “2021 Plan”) and 2016 Long-Term Incentive Plan (the “2016 Plan”) during the three months ended September 30, 2024 and 2023, respectively, and $19.3 million and $18.6 million during the nine months ended September 30, 2024 and 2023, respectively. During the nine months ended September 30, 2024, we granted 496,803 market-based performance units and 284,702 time-vesting units under the 2021 Plan. Performance-based restricted stock units are valued using a Monte Carlo simulation. Time-vesting restricted stock units are valued based on our closing stock price on the trading day immediately preceding the date of the grant, or as of the date of modification in the event an award is modified. The weighted-average grant date fair value of the market-based performance and time-vesting restricted stock units granted during the nine months ended September 30, 2024 was $38.40 and $33.69, respectively. In connection with the acquisition of Acima Holdings in 2021, we issued to the former owners of Acima Holdings 10,779,923 of common shares valued at $51.14 per share, as of the date of closing. Of this total, 2,683,328 common shares were included in the aggregate purchase price of the transaction for financial reporting purposes, while 8,096,595 common shares, valued at $414.1 million, issued under restricted stock agreements and subject to vesting conditions, were recognized as stock compensation expense over the vesting term in accordance with ASC Topic 718, “Stock-based Compensation” and recorded to other gains and charges in our unaudited Condensed Consolidated Statements of Operations. We recognized $4.9 million in stock compensation expense related to these restricted stock agreements during the nine months ended September 30, 2024, and $9.4 million and $128.1 million during the three and nine months ended September 30, 2023, respectively. These restricted stock agreements were fully vested during the three months ended March 31, 2024. Stock compensation expense recognized during the nine months ended September 30, 2023 for these restricted stock agreements included $78.4 million attributable to the acceleration of vesting provisions, primarily related to former employee and Acima founder Aaron Allred’s transition from Executive Vice President of Acima to an advisory role in early 2023. On April 3, 2024, we entered into a letter agreement with the Company’s Chief Executive Officer as disclosed in our Current Report on Form 8-K dated as of April 5, 2024. The terms of the letter agreement included special provisions for his outstanding restricted stock awards vesting at various times through February 2027, which resulted in the acceleration of stock compensation expense for those awards in accordance with ASC Topic 718, “Stock-based Compensation”. Accelerated stock compensation expense recognized for the three and nine months ended September 30, 2024 due to this letter agreement was approximately $1.7 million and $3.4 million, respectively, and was recorded to other gains and charges in our unaudited Condensed Consolidated Statements of Operations.

Other Gains and Charges (Tables)

9 Months Ended

Sep. 30, 2024

Unusual or Infrequent Items, or Both [Abstract]

Other Gains and Charges

Activity with respect to other gains and charges is summarized in the below table:


	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2024		2023		2024		2023










Acima acquired assets depreciation and amortization	$	14,901	$	18,234	$	46,447	$	54,701
Legal matters	11,038		(96)		11,738		44
Accelerated software depreciation	—		4,609		6,145		4,609
Asset impairments	(67)		—		5,961		—
Acima equity consideration vesting	—		9,379		4,893		128,128
Accelerated stock compensation	1,688		—		3,421		—






Other(1)	588		(3,069)		1,261		(3,069)
Total other gains and charges	$	28,148	$	29,057	$	79,866	$	184,413

(1) Primarily represents shutdown and holding expenses related to store closures for both the three and nine months ended September 30, 2024 and interest income on tax refunds for prior years received in 2023 for both the three and nine months ended September 30, 2023.

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
ASSETS
Cash and cash equivalents	$ 85,054	$ 93,705
Receivables, net of allowance for doubtful accounts of $13,773 and $14,254 in 2024 and 2023, respectively	121,645	111,005
Prepaid expenses and other assets	74,442	50,259
Rental merchandise, net
On rent	1,016,716	1,109,896
Held for rent	123,055	124,167
Merchandise held for installment sale	5,572	6,398
Property assets, net of accumulated depreciation of $640,997 and $611,120 in 2024 and 2023, respectively	258,075	273,118
Operating lease right-of-use assets	269,307	289,702
Deferred tax asset	68,702	72,032
Goodwill	289,750	289,750
Other intangible assets, net	266,172	301,398
Total assets	2,578,490	2,721,430
LIABILITIES
Accounts payable – trade	124,805	177,249
Accrued liabilities	281,985	322,905
Operating lease liabilities	277,318	293,435
Deferred tax liability	46,910	60,842
Senior debt, net	794,257	866,707
Senior notes, net	441,395	439,920
Total liabilities	1,966,670	2,161,058
STOCKHOLDERS' EQUITY
Common stock, $0.01 par value; 250,000,000 shares authorized; 125,756,530 and 125,415,059 shares issued in September 30, 2024 and December 31, 2023, respectively	1,107	1,100
Additional paid-in capital	1,485,165	1,459,709
Retained earnings	1,026,580	994,892
Treasury stock at cost, 71,060,928 shares in September 30, 2024 and December 31, 2023	(1,890,966)	(1,890,966)
Accumulated other comprehensive loss	(10,066)	(4,363)
Total Stockholders' Equity	611,820	560,372
Total Liabilities and Stockholders' Equity	$ 2,578,490	$ 2,721,430

Divestitures	9 Months Ended
Divestitures	Sep. 30, 2024
Discontinued Operations and Disposal Groups [Abstract]
Divestitures	Divestitures Refranchise Sale On September 9, 2024, we sold 55 Rent-A-Center stores in the states of New York and New Jersey to a franchisee. We received cash consideration of approximately $19.1 million, including approximately $0.6 million related to franchise fees. The sale included on rent and held for rent inventory of approximately $13.0 million, property assets of approximately $2.0 million, and prorated rent and other miscellaneous expenses of $0.4 million, resulting in a net gain on sale of approximately $3.1 million. The gain on sale was recorded to non-labor operating expenses in our condensed consolidated statement of operations.

Other Gains and Charges

9 Months Ended

Sep. 30, 2024

Unusual or Infrequent Items, or Both [Abstract]

Other Gains and Charges

Acima Holdings Acquisition. On February 17, 2021, we completed the acquisition of Acima Holdings, a leading provider of virtual lease-to-own solutions. Included in the aggregate consideration issued to the former owners of Acima Holdings were 8,096,595 common shares, valued at $414.1 million, subject to 36-month vesting conditions under restricted stock agreements, which were recognized over the vesting term as stock compensation expense, in accordance with ASC Topic 718, “Stock-based Compensation”. During the nine months ended September 30, 2024 and 2023, we recognized approximately $4.9 million and $128.1 million in stock compensation expense, respectively, related to these restricted stock agreements. See Note 11 for additional information.

The fair value of assets acquired as part of the transaction included $520 million in intangible assets and $170 million in developed technology. During the nine months ended September 30, 2024 and 2023, we recognized approximately $34.5 million and $42.8 million in amortization expense, respectively, related to acquired intangible assets. We also recognized approximately $11.9 million in incremental depreciation expense related to acquired technology assets during both the nine months ended September 30, 2024 and 2023.

Legal Matters. As disclosed further in Note 12, "Contingencies", in this Form 10-Q and as previously disclosed, we are currently party to recently filed regulatory lawsuits with the Consumer Financial Protection Bureau and with the New York Attorney General, as well as a multi-state regulatory investigation by attorney's general offices from forty states and the District

of Columbia. These matters relate to lease-to-own transactions for our Acima subsidiary, which was acquired in 2021. We believe these regulatory lawsuits and the multi-state investigation are not representative of historical regulatory matters that arise in the ordinary course of our business. During the nine months ended September 30, 2024, we recorded expenses of $8.2 million related to estimated legal settlement reserves for certain of these regulatory matters based on the current status of the legal settlement discussions. We will continue to evaluate and modify our legal settlement reserves as appropriate in future periods based on future developments. In addition, for these regulatory matters we incurred litigation and defense expenses of $3.5 million for the nine months ended September 30, 2024.

Internally Developed Software Depreciation. During the third quarter of 2023, we completed initial development and began pilot testing a new internally developed point-of-sale system for our Rent-A-Center lease-to-own stores. Deployment of the new system across our lease-to-own store network began in the second quarter of 2024 and was completed in the third quarter of 2024, at which time our existing point-of-sale software was retired. Therefore, in the third quarter of 2023, we accelerated the remaining useful lives of our existing point-of-sale software assets to align with the deployment timeline of our new point-of-sale system, which resulted in the recognition of additional depreciation expense of $6.1 million and $4.6 million for the nine months ended September 30, 2024 and 2023, respectively.

Stock Award Letter Agreement. On April 3, 2024, we entered into a letter agreement with the Company’s Chief Executive Officer as disclosed in our Current Report on Form 8-K dated as of April 5, 2024. The terms of the letter agreement included special provisions for his outstanding restricted stock awards vesting at various times through February 2027, which resulted in the acceleration of stock compensation expense for those awards in accordance with ASC Topic 718, “Stock-based Compensation”. Accelerated stock compensation expense recognized for the nine months ended September 30, 2024 due to this letter agreement was approximately $3.4 million.

Store Consolidations. During the first half of 2024, we closed 55 Rent-A-Center stores, resulting in pre-tax charges of $5.3 million in lease impairment charges, $0.6 million in disposal of fixed assets and $1.0 million in other miscellaneous shutdown and holding costs.

Activity with respect to other gains and charges is summarized in the below table:


	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2024		2023		2024		2023










Acima acquired assets depreciation and amortization	$	14,901	$	18,234	$	46,447	$	54,701
Legal matters	11,038		(96)		11,738		44
Accelerated software depreciation	—		4,609		6,145		4,609
Asset impairments	(67)		—		5,961		—
Acima equity consideration vesting	—		9,379		4,893		128,128
Accelerated stock compensation	1,688		—		3,421		—






Other(1)	588		(3,069)		1,261		(3,069)
Total other gains and charges	$	28,148	$	29,057	$	79,866	$	184,413

Revenues

9 Months Ended

Sep. 30, 2024

Revenues [Abstract]

Revenues

The following tables disaggregate our revenue for the periods ended September 30, 2024 and 2023:


	Three Months Ended September 30, 2024
	Acima		Rent-A-Center		Mexico		Franchising		Consolidated
(in thousands)
Rentals and fees	$	442,463	$	417,327	$	18,041	$	—	$	877,831
Merchandise sales	123,299		26,707		746		—		150,752
Installment sales	—		14,416		—		—		14,416
Franchise merchandise sales	—		—		—		18,195		18,195
Royalty income and fees	—		—		—		5,863		5,863
Other	421		293		243		845		1,802
Total revenues	$	566,183	$	458,743	$	19,030	$	24,903	$	1,068,859



	Nine Months Ended September 30, 2024
	Acima		Rent-A-Center		Mexico		Franchising		Consolidated
(in thousands)
Rentals and fees	$	1,301,874	$	1,277,477	$	56,996	$	—	$	2,636,347
Merchandise sales	377,389		96,701		2,600		—		476,690
Installment sales	—		44,333		—		—		44,333
Franchise merchandise sales	—		—		—		60,136		60,136
Royalty income and fees	—		—		—		18,539		18,539
Other	1,060		888		869		2,474		5,291
Total revenues	$	1,680,323	$	1,419,399	$	60,465	$	81,149	$	3,241,336


	Three Months Ended September 30, 2023
	Acima		Rent-A-Center		Mexico		Franchising		Consolidated
(in thousands)
Rentals and fees	$	375,202	$	413,051	$	18,513	$	—	$	806,766
Merchandise sales	99,857		26,819		888		—		127,564
Installment sales	—		13,444		—		—		13,444
Franchise merchandise sales	—		—		—		24,082		24,082
Royalty income and fees	—		—		—		5,813		5,813
Other	157		318		241		713		1,429
Total revenues	$	475,216	$	453,632	$	19,642	$	30,608	$	979,098



	Nine Months Ended September 30, 2023
	Acima		Rent-A-Center		Mexico		Franchising		Consolidated
(in thousands)
Rentals and fees	$	1,107,943	$	1,260,745	$	52,351	$	—	$	2,421,039
Merchandise sales	314,741		97,905		2,610		—		415,256
Installment sales	—		45,191		—		—		45,191
Franchise merchandise sales	—		—		—		69,778		69,778
Royalty income and fees	—		—		—		18,636		18,636
Other	737		990		565		2,130		4,422
Total revenues	$	1,423,421	$	1,404,831	$	55,526	$	90,544	$	2,974,322

Lease Purchase Agreements

Rentals and Fees. Rental merchandise is leased to customers pursuant to lease-to-own agreements, which provide for weekly, bi-weekly, semi-monthly or monthly terms with non-refundable lease payments. At the expiration of each lease term, customers may renew the lease-to-own agreement for the next lease term. The customer has the right to acquire title of the merchandise either through an early purchase option or through payment of all optional lease renewal terms. Customers can terminate the lease-to-own agreement and return the product at the end of any lease term without penalty. Therefore, lease-to-own agreements are accounted for as operating leases.

Lease payments received at our Rent-A-Center stores, certain Acima locations formerly operating under the Acceptance Now brand, and Mexico stores must be prepaid in advance of the next lease renewal term. Under the Acima Holdings business model, in certain cases revenues may be earned prior to the lease payment due date, in which case revenue is accrued prior to receipt of the lease payment, net of estimated returns and uncollectible renewal payments. Under both models, rental revenue is recognized over the lease term. See Note 4 for additional information regarding accrued lease revenue.

Cash received for rental payments, including fees, prior to the period in which it should be recognized, is deferred and recognized according to the lease term. At September 30, 2024 and December 31, 2023, we had $62.7 million and $68.6 million, respectively, in deferred revenue included in accrued liabilities related to our lease-to-own agreements. Revenue related to various payment, reinstatement or late fees is recognized when paid by the customer at the point service is provided. Rental merchandise in our Rent-A-Center stores, certain Acima locations formerly operating under the Acceptance Now brand, and Mexico stores is depreciated using the income forecasting method and recognized in cost of rentals and fees in our Condensed Consolidated Statements of Operations over the lease term. Lease merchandise under Acima Holdings is depreciated over the lease term using a straight-line depreciation method. Under the income forecasting method, the consumption of lease merchandise occurs during periods of rental and depreciation directly coincides with the receipt of rental revenue over the lease-to-own contract period. Depreciation under the straight-line method is recognized each period over the term of the lease-to-own contract irrespective of receipt of revenue payments from the customer.

We also offer additional optional product plans along with our lease-to-own agreements which provide customers with liability protection against significant damage or loss of a product, and club membership benefits, including various discount programs and product service and replacement benefits in the event merchandise is damaged or lost, and payment waivers in the event eligible customers become unemployed. Customers renew product plans in conjunction with their lease term renewals, and can cancel the plans at any time. Revenue for product plans is recognized over the term of the plan. Costs incurred related to product plans are primarily recognized in cost of revenues.

Revenue from contracts with customers

Merchandise Sales. Merchandise sales include payments received for the exercise of the early purchase options offered through our lease-to-own agreements or merchandise sold through point-of-sale transactions. Revenue for merchandise sales is recognized when payment is received and ownership of the merchandise passes to the customer. The remaining net value of merchandise sold is recorded to cost of merchandise sold at the time of the transaction.

Installment Sales. Revenue from the sale of merchandise in our retail installment stores is recognized when the installment note is signed and control of the merchandise has passed to the customer. The cost of merchandise sold through installment agreements is recognized in cost of installment sales at the time of the transaction. We offer optional extended service plans with our installment agreements which are administered by third parties and provide customers with product maintenance beyond the term of the installment agreement. Payments received for extended service plans are deferred and recognized, net of

related costs, when the installment payment plan is complete and the service plan goes into effect. Customers can cancel extended service plans at any time during the installment agreement period and receive a refund for payments previously made towards the plan. At September 30, 2024 and December 31, 2023, we had $0.6 million and $1.1 million, respectively, in deferred revenue included in accrued liabilities related to extended service plans.

Franchise Merchandise Sales. Revenue from the sale of rental merchandise is recognized upon shipment of the merchandise to the franchisee.

Royalty Income and Fees. Franchise royalties, including franchisee contributions to corporate advertising funds, represent sales-based royalties calculated as a percentage of gross rental payments and sales. Royalty revenue is accrued and recognized as rental payments and merchandise sales occur. Franchise fees are initial fees charged to franchisees for new or converted franchise stores. Franchise fee revenue is recognized on a straight-line basis over the term of the franchise agreement. At September 30, 2024 and December 31, 2023, we had $2.9 million and $3.0 million, respectively, in deferred revenue included in accrued liabilities related to franchise fees.

Other. Other revenue consists of revenue generated by other miscellaneous product plans offered to our rental and installment customers. Revenue for other product plans is recognized in accordance with the terms of the applicable plan agreement.

- Definition

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Name Accounting Standards Codification
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+ Details