PROG Holdings Profile
PROG Holdings, Inc. (PROG Holdings) operates as a financial technology holding company that provides transparent and competitive payment options to consumers.
PROG Holdings' operating segments include Progressive Leasing, an in-store, app-based, and e-commerce point-of-sale lease-to-own solutions provider; Vive Financial (‘Vive’), an omnichannel provider of second-look revolving credit products; and Four Technologies, Inc. (‘Four’), which offers Buy Now, Pay Later (‘BNPL’) payment options to consumers through the Four platform. PROG Holdings also owns Build, a credit building financial management tool.
The Progressive Leasing segment comprised approximately 97% of the company’s consolidated revenues for the year ended December 31, 2023. Progressive Leasing provides consumers with lease-purchase solutions for merchandise, including furniture, appliances, electronics, jewelry, mobile phones and accessories, mattresses, and automobile electronics and accessories from leading traditional and e-commerce retailers (whom the company refers to as its point-of-sale partners, ‘POS partners,’ or ‘retail partners’). Progressive Leasing's technology-based, proprietary decisioning platform offers prompt lease decisioning at the point-of-sale and is integrated with both traditional and e-commerce POS partners' systems. Progressive Leasing provides customers with transparent and competitive lease payment options along with flexible terms that are designed to help customers achieve merchandise ownership, including through low initial payments and early buyout options.
Strategy
The company’s strategy to drive growth in its business, which positions the company for success over the long-term, includes the following: enhancing the company’s industry-leading consumer experience and expanding the company’s ecosystem to increase access and deliver more value to the company’s consumers.
Operating Segments
The company has three operating segments: Progressive Leasing, Vive and Four. The company's two reportable segments are Progressive Leasing and Vive.
Progressive Leasing
Progressive Leasing is the company’s largest operating segment, which empowers consumers and businesses with transparent and flexible lease-to-own options to help consumers achieve ownership of durable goods. Progressive Leasing provides e-commerce, app-based, and in-store point-of-sale lease-to-own solutions through approximately 23,000 third-party POS partner locations and e-commerce websites in 45 states, the District of Columbia and Puerto Rico. It does so by purchasing the desired merchandise from POS partners and, in turn, leasing that merchandise to customers through a cancellable lease-to-own transaction. Progressive Leasing consequently has no stores of its own, but rather offers lease-purchase solutions to the customers of traditional and e-commerce retailers.
Vive
Vive primarily serves customers who may not qualify for traditional prime lending offers and desire to purchase goods and services from participating merchants. Vive offers customized programs with services that include revolving loans through private label and Vive-branded credit cards. Vive's network of over 7,500 POS partner locations and e-commerce websites includes furniture, mattresses, fitness equipment, and home improvement retailers, as well as medical and dental service providers.
Four
Four provides consumers of all credit backgrounds with BNPL options through four interest-free installments. Four's proprietary platform capabilities provide the company’s base of customers and POS partners with another payment solution as part of the PROG Holdings financial technology offerings. Shoppers use Four's platform to purchase furniture, clothing, electronics, health and beauty, footwear, jewelry, and other consumer goods from retailers across the United States. Four was not a reportable segment for the year ended December 31, 2023 as its financial results were not material to the company's results of operations or financial condition. Four's financial results are reported within ‘Other’ for segment reporting purposes.
Marketing and Advertising
Progressive Leasing actively markets its leasing services to help its customers achieve ownership of durable goods and drive new shoppers and incremental revenue for the company’s POS partners. The company invests in digital, traditional, and in-store marketing; and its internal marketing and data science teams continually evaluate and optimize this investment to maximize the benefit for the company’s POS partners.
The company’s robust digital media program is consisted of paid search, digital display, mobile, video, and paid social advertising. Through a variety of media testing methods, the company can verify the impact of the company’s paid digital media on in-store and online shopping trips and lease origination activity. In addition, targeted, personalized email and SMS marketing campaigns leverage the company’s large customer database, educating customers about lease-to-own offerings, and driving lease conversion and sales for the company’s POS partners. In addition, in cooperation with the company’s POS partners, Progressive Leasing leverages a variety of in-store marketing materials to drive awareness at the point of sale. These efforts drive new and returning customers online and into retail locations, generating incremental sales for the company’s POS partners.
Seasonality
Progressive Leasing's revenue mix is moderately seasonal. Adjusting for growth, the first quarter of each year generally has higher revenues than any other quarter. This is primarily due to realizing the benefit of the company’s POS partners' increases in business and higher lease originations during the fourth quarter (year ended December 2023) holiday season, as well as increased liquidity for the company’s customers in the first quarter due to receipt of federal and state income tax refunds.
Government Regulation
The company’s Vive business, through its bank partners, offers Vive branded credit cards and other private label credit card products for subprime and near-prime consumers. Accordingly, it is subject to federal laws and regulations with respect to cardholder agreement terms and disclosures (e.g., the Truth In Lending Act), credit discrimination (e.g., the Equal Credit Opportunity Act), credit reporting (e.g., the Fair Credit Reporting Act), and servicing and collection activities.
History
The company was founded in 1955. It was formerly known as Aaron's, Inc. and changed its name to PROG Holdings, Inc. in 2020.
