Nelnet, Inc. reported its financial results for the three and nine months ended September 30, 2024, revealing significant changes in revenue, profitability, and strategic developments compared to the same period in 2023.

For the third quarter of 2024, Nelnet's total interest income decreased to $240.5 million from $284.6 million in Q3 2023. The net interest income also fell to $72.2 million from $77.4 million year-over-year. The company reported a net income attributable to Nelnet, Inc. of $2.4 million, a sharp decline from $44.4 million in the prior year. Earnings per share for Q3 2024 were $0.07, down from $1.18 in Q3 2023. For the nine months ended September 30, 2024, net income attributable to Nelnet, Inc. increased to $120.9 million from $97.7 million in the same period of 2023.

The company’s revenue sources showed mixed results. Loan Servicing and Systems revenue decreased to $108.2 million in Q3 2024 from $127.9 million in Q3 2023, while Education Technology Services and Payments revenue increased to $118.2 million from $113.8 million. Notably, solar construction revenue surged to $19.3 million in Q3 2024, compared to $6.3 million in Q3 2023, reflecting a strategic pivot towards commercial solar projects.

Strategically, Nelnet has undergone significant restructuring, particularly in its solar operations, which included a headcount reduction of approximately 40 associates and a restructuring charge of $1.6 million. Additionally, in June 2024, the company reduced its Loan Servicing and Systems workforce by about 220 associates, incurring an estimated charge of $7.1 million.

The company’s total cash and cash equivalents as of September 30, 2024, stood at $219.7 million, an increase from $168.1 million at the end of 2023. However, total loans and accrued interest receivable for Non-Nelnet Bank decreased to $9.1 billion from $11.7 billion at the end of 2023, indicating a contraction in the loan portfolio.

Nelnet's total equity was reduced by $21.8 million as of December 31, 2023, reflecting cumulative impacts from prior corrections. The company also recognized a non-cash expense of $5.6 million due to the write-off of unamortized debt discounts associated with debt securities.

In terms of market conditions, Nelnet continues to navigate challenges related to the student loan landscape, particularly following the Supreme Court's ruling against broad-based student debt relief. The company remains focused on leveraging its liquidity for potential acquisitions and strategic investments while maintaining a robust capital structure.