Navient Corporation (NAVI): Business Model Canvas [Dec-2025 Updated]

You're trying to map out Navient Corporation's (NAVI) new game plan after their big strategic shift, and honestly, it boils down to a disciplined two-pronged attack. They are laser-focused on originating over \$2.2 billion in high-quality private education loans for 2025, while their main cash engine remains maximizing returns from that huge, amortizing Federal Family Education Loan Program (FFELP) portfolio. This whole operation is being streamlined by a major cost-cutting drive targeting over \$400 million in savings, which is what supports their current full-year Core EPS guidance between \$0.95 to \$1.05. Dive into the nine building blocks below to see exactly how they are structuring their partnerships, resources, and revenue streams to make this pivot work.

Navient Corporation (NAVI) - Canvas Business Model: Key Partnerships

You're looking at how Navient Corporation structures its external relationships to manage its loan portfolio and fund growth as of late 2025. Honestly, the shift to a variable cost structure and reliance on capital markets are the defining features here.

The move to an outsourced servicing model is a big one for cost control. Navient outsourced the servicing of its portfolio to a third-party partner on July 1, 2024. This action was specifically designed to eliminate the fixed cost of servicing, aligning the expense model with the amortizing legacy portfolio. This strategy is showing results; operating expenses were \$4 million lower in the third quarter of 2025 compared to the third quarter of 2024, partly due to this outsourcing. The company expects to exceed its overall multi-year expense reduction target of \$400 million.

Access to capital markets is clearly critical for funding the Consumer Lending segment's origination growth. Navient is actively engaging capital markets investors through asset-backed securitization (ABS). The company completed its third refinance student loan securitization of 2025, the \$542 million Navient Refinance Loan Trust (NAVRL) 2025-C transaction, in October 2025. This followed the \$543 million NAVRL 2025-B transaction in September 2025. The Q2 2025 results also noted an issuance of \$536 million of asset-backed securities. The inaugural in-school ABS deal in Q2 2025 was nearly 6 times oversubscribed, signaling strong investor demand.

For general corporate funding and balance sheet management, Navient partners with debt capital providers. In Q2 2025, Navient issued \$500 million of unsecured debt, reportedly near all-time tights to Treasuries. As of the end of Q2 2025, Navient had \$5.3 billion in unsecured debt outstanding. While specific warehouse line details aren't current, the ability to issue ABS and unsecured debt shows deep relationships with financial institutions and investment banks.

The Earnest platform remains a key internal technology partnership, as it drives the Consumer Lending segment's origination growth. Navient acquired Earnest, a financial technology company, back in 2017. Navient is scheduled to host a webcast on November 19, 2025, to discuss the growth strategy for its Earnest business. The technology leverages advanced analytics and data science to originate high-quality private education loans.

Here's a quick look at the key funding and servicing partners identified from recent activity:

• Third-party loan servicing partner: Outsourced servicing began July 1, 2024.
• Capital markets investors: Supported \$542 million (NAVRL 2025-C) and \$543 million (NAVRL 2025-B) ABS deals in late 2025.
• Technology vendors: Earnest Operations LLC platform, acquired in 2017.
• Investment banks: Managed the Q3/Q4 2025 ABS deals.

The involvement of investment banks in the capital markets activity is substantial. These firms underwrite the debt and ABS issuances, which are the lifeblood of the Consumer Lending segment's growth. The Q2 2025 unsecured debt issuance of \$500 million is a prime example of this partnership in action.

For the ABS deals, the syndicate of investment banks is consistent. For instance, the \$543 million NAVRL 2025-B deal was managed by BofA Securities (str.), J.P. Morgan, Barclays, RBC Capital Markets, and Atlas SP. The \$542 million NAVRL 2025-C deal involved RBC Capital Markets (str.), J.P. Morgan, Barclays, BofA Securities, and Atlas SP. The March 2025 \$550 million NAVI 2025-A deal included J.P. Morgan Securities, ATLAS SP Securities, Barclays Capital, BofA Securities and RBC Capital Markets as initial purchasers.

Finance: draft a memo detailing the expected cost savings from the servicing outsourcing run-rate through Q4 2025 by Wednesday.

Navient Corporation (NAVI) - Canvas Business Model: Key Activities

You're looking at the core actions Navient Corporation is taking to drive value right now, late in 2025. It's a mix of managing legacy assets and aggressively pursuing growth in private lending, all while cutting down the cost structure that used to support older business lines.

Originate private education loans, targeting $2.2 billion in 2025

The push into private education loans, particularly through the Earnest brand, is a major focus. Navient Corporation set an ambitious origination target of \$2.2 billion for the full year 2025. To give you a sense of the pace, the company originated over \$1 billion in total private education loans in the first half of 2025. The second quarter alone saw \$443 million in refinance loan originations, which was double the volume from the same period last year. This focus is clearly on high-quality borrowers; for instance, graduate students made up 48% of the year-to-date in-school product volume.

Here's a quick look at the recent origination performance:

Manage and collect on the amortizing FFELP loan portfolio

Managing the legacy Federal Family Education Loan Program (FFELP) portfolio is about maximizing cash flow from an asset base that is shrinking through amortization. As of December 31, 2024, Navient held a portfolio of FFELP Loans valued at \$31 billion. The activity here is characterized by steady, but declining, cash flow. You saw FFELP Loan prepayments drop significantly in Q2 2025 to \$228 million, down from \$2.5 billion in the second quarter of 2024. The Net Interest Margin (NIM) for this segment was reported at 0.70% in Q2 2025.

The core activities for this portfolio involve:

• Helping borrowers manage their loans.
• Prudent interest rate risk management.
• Asset/liability management and match funding.
• Managing credit through economic cycles.

Securitization and funding activities for loan portfolios

To fund the new originations and maintain balance sheet flexibility, Navient is actively using the capital markets, especially for its private loans. They completed three refinance student loan securitizations in 2025 alone. The first was the inaugural asset-backed security (ABS) backed by Earnest loans, Navient Education Loan Trust (NAVEL) 2025-A, for \$536 million in June. Then came the Navient Refinance Loan Trust (NAVRL) 2025-B for \$543 million in September, followed by the NAVRL 2025-C transaction for \$542 million in October. In total, they issued \$536 million of asset-backed securities in Q2 2025.

The NAVEL 2025-A deal is a good example of the structure; the Class A notes received a AAA (sf) rating, with \$405.7 million of the total issuance size.

Execute strategic expense reduction plan (targeting over $400 million savings)

Navient is executing a multi-phase plan to simplify operations and reduce its expense base, aiming to exceed an original target of over \$400 million in savings. This is a massive undertaking; total expenses in Q2 2025 were \$100 million, down from \$182 million in Q2 2024, representing a 45% reduction. They achieved this partly by outsourcing loan servicing in July 2024 and divesting the government services business in February 2025. The headcount reduction is stark, showing over 80% fewer employees compared to the end of 2023.

The impact of these cost-cutting measures is clear:

• Path to exceed \$400 million in expense reductions.
• Phase 1 cost reductions were set to improve the operating break-even level by approximately \$120 million annually.
• Healthcare Services-related expense reductions were expected to be fully realized by H2 2025.

Digital marketing and lead generation for the Earnest brand

The Earnest brand is central to the growth strategy, focusing on student loan refinancing and personal lending. The total addressable market (TAM) for student loan refinancing in 2025 was estimated around \$8 billion. As of late 2025, Earnest supports about 375,000 unique customer relationships, with an expectation to add another 40,000 in 2026. The brand employs about 330 people. The expected operating profit for the Earnest division, after adjusting for the removal of in-school and graduate lending operations, is around \$70 million for the year. The average Earnest customer has a FICO score above 770 and an income of about \$200,000 a year.

Navient Corporation (NAVI) - Canvas Business Model: Key Resources

You're looking at the core assets Navient Corporation (NAVI) relies on as of late 2025. These aren't just line items; they are the engines running the business right now.

Large portfolio of legacy FFELP loans (cash flow engine)

The portfolio of legacy Federal Family Education Loan Program (FFELP) loans remains a primary source of stable cash flow, even as prepayments fluctuate. For instance, in the second quarter of 2025, FFELP Loan prepayments totaled $228 million. The net interest margin (NIM) for this segment in that same quarter was reported at 0.70%. This portfolio is managed with the goal of optimizing the cash flows generated over its long life.

The cash flow engine is supported by specific financial characteristics:

• Expected amortization period in excess of 20 years (based on prior data).
• Goal to support customers while optimizing cash flows.
• FFELP Loan NIM of 0.70% in Q2 2025.

Earnest digital lending platform and data science capabilities

The Earnest platform is central to Navient Corporation's growth in private lending, leveraging its digital-first approach and data science expertise. You saw strong momentum here, with over $1 billion in total loan originations across the Consumer Lending segment in the first half of 2025. Specifically, Q2 2025 saw $443 million in refinance loan originations alone, which doubled the volume year-over-year. Navient Corporation originally acquired Earnest for its 'best-in-class data science' capabilities, which are now applied to consumer-centric credit products.

The platform's recent activity shows its focus:

• Refinance originations in Q2 2025: $443 million.
• Total originations in H1 2025: Over $1 billion.
• Focus on private refinance and in-school graduate loans.

Expertise in capital markets and securitization

Navient Corporation's capital markets team is highly active, using securitization to fund growth and manage its balance sheet efficiently. The first half of 2025 was noted as the most active period for the capital markets team since 2021. They successfully executed multiple asset-backed securities (ABS) deals backed by refinance loans and in-school loans, demonstrating strong market access and underwriting quality. The average FICO scores on the collateral for 2025 securitizations actually went up, which is deliberate.

Here's a look at some of the major capital markets transactions closed in the latter half of 2025:

Adjusted tangible equity ratio of 9.8% (Q2 2025)

The balance sheet strength, as measured by regulatory capital, is a key resource. For the second quarter of 2025, Navient Corporation reported its GAAP equity-to-asset ratio at 5.1%, while the key non-GAAP metric, the adjusted tangible equity ratio, stood at 9.8%. This ratio reflects management's view of the capital position after certain adjustments.

Reduced, streamlined corporate infrastructure and shared services

Operational efficiency is being driven by significant structural changes, including asset sales and expense reduction targets. Navient Corporation completed the sale of its government services business in February 2025, which immediately impacted the operating expense base. The company is working to complete related transition services agreements by the end of 2025. Previously, management had identified a Phase 1 reduction in Shared and Corporate Expense of an estimated pre-tax savings of $119 million over the remaining life of the legacy portfolio, which is a tangible result of this streamlining effort. They are definitely making progress on that ambitious expense reduction target.

Infrastructure changes include:

• Sale of Government Services business completed in February 2025.
• Phase 1 targeted pre-tax savings: $119 million.
• Transition services related to the BPS sale expected to end by the close of 2025.

Finance: draft 13-week cash view by Friday.

Navient Corporation (NAVI) - Canvas Business Model: Value Propositions

You're looking at the core reasons why customers and investors choose Navient Corporation now, late in 2025, after its major transformation. The value propositions are built around a leaner structure focused on its core lending assets and growth engine.

High-quality private loan refinancing with flexible terms for prime borrowers

Navient Corporation is aggressively pursuing the private refinance market, specifically targeting borrowers with strong credit profiles. The company set an origination target of $2.2 billion for 2025. In the second quarter of 2025, refinance loan originations hit $443 million, which was nearly double the volume from the same period last year. By the third quarter of 2025, refinance originations grew further to $528 million. This focus on quality is evident: graduate students made up 57% of the refinance volume year-to-date as of Q2 2025. The company is also actively funding this growth through capital markets, successfully closing its second securitization of 2025 backed by these loans for $543 million in September 2025.

Here are the recent Consumer Lending origination numbers:

The platform supporting this is the Earnest platform, which Navient highlights for its quality; it has been recognized by U.S. News as the Best Private Student Loan Lender for three consecutive years.

Maximizing cash flows and returns from legacy FFELP assets

The Federal Family Education Loan Program (FFELP) portfolio is managed for predictable cash generation. The Net Interest Margin (NIM) in this segment shows its efficiency. In the second quarter of 2025, the FFELP NIM was 70 basis points, exceeding the high end of the guided range of 45 to 60 basis points. This improved further to 0.84% in the third quarter of 2025. This performance is partly due to management revising assumptions following a significant decline in prepayments; Q3 2025 prepayments were $268 million, down from $1.0 billion in Q3 2024. Overall, the total projected undiscounted cash flows from the legacy loan portfolio, after repaying secured financings, stand at $12.2 billion over the next 20 years as of September 30, 2025.

Digital-first, superior customer experience via the Earnest platform

While specific 2025 Net Promoter Score (NPS) or Customer Satisfaction (CSAT) figures for Earnest aren't public, the value proposition is supported by its recognition and the strategic exclusion of its operating costs from core expense reduction targets, signaling investment in this growth area. The focus is on providing an experience that attracts high-quality borrowers.

Capital return to shareholders

Navient Corporation is committed to returning capital to shareholders through dividends and repurchases. For the first half of 2025, the company executed $59 million in share repurchases.

• Share repurchases in H1 2025 totaled $59 million ($35 million in Q1 plus $24 million in Q2).
• Total capital returned to shareholders (repurchases plus dividends) in Q2 2025 was $40 million.
• In Q3 2025, the company repurchased $26 million of common shares and paid $16 million in common stock dividends.
• On October 29, 2025, the Board authorized a new $100 million share repurchase program.

Simplified, more efficient business model post-divestiture

The transformation involved divesting the Business Processing division, with the sale of the Government Services business completing the process in February 2025. This streamlining effort established a clear path to exceed the initial expense reduction target of $400 million (based on 2023 expenses, excluding Earnest and regulatory costs).

The efficiency gains are measurable:

• Total core operating expenses in Q2 2025 were $100 million.
• Headcount has been reduced by over 80% compared to the end of 2023.
• Phase 1 cost reductions are estimated to improve the operating break-even level by approximately $120 million annually.
• The company expects to fully realize the Government Services-related expense reductions in early 2026.

Finance: draft 13-week cash view by Friday.

Navient Corporation (NAVI) - Canvas Business Model: Customer Relationships

You're looking at how Navient Corporation (NAVI) manages the people who use its services and the institutions that fund them as of late 2025. The focus here is on the interaction layer of the business model, which has seen significant shifts following the outsourcing of its federal loan servicing function in July 2024.

Automated, digital self-service for Earnest customers

For the Consumer Lending Segment, which includes the Earnest brand, the relationship is heavily weighted toward digital efficiency. This is necessary to support the growth seen in this area; for example, Private Education Loan originations hit $500 million in the second quarter of 2025. Navient Corporation supports these customers with digital tools first. Honestly, the digital experience is the front door for this segment.

• Virtual assistant available 24/7 for general account questions.
• Client Happiness team available via email, phone, and chat during specified hours.
• Refinance loan originations doubled for the third consecutive quarter in Q3 2025.

The goal is to resolve simple inquiries instantly, keeping human interaction reserved for when it truly matters. This digital-first approach helps manage the scale required to support the $1.8 billion origination target for 2025.

Dedicated customer support for complex loan servicing issues

When issues arise, especially on the legacy Federal Family Education Loan Program (FFELP) portfolio or complex private loan scenarios, dedicated support steps in. While the bulk of servicing is now with a third-party partner, Navient Corporation maintains direct, high-touch channels for escalations and specialized needs. You see the need for this when you look at the portfolio stress points.

As of the second quarter of 2025, delinquencies greater than 90 days across the portfolio stood at $2.5 billion, and loans in forbearance totaled $3.7 billion. These figures represent the complex cases that require specialized, dedicated agent intervention, moving beyond the automated chat function.

For Earnest clients specifically, support is routed to a dedicated Client Happiness team, reachable by phone at (888) 601-2801, Monday through Friday, 6 a.m. to 5 p.m. PT, excluding holidays. This separation ensures that the customer with a complex repayment issue doesn't get stuck in the general queue.

Proactive communication on repayment options and financial literacy

Navient Corporation's stated mission is to enhance customer success through compassionate and personalized service. This translates into proactive outreach regarding repayment options, especially as the company reviews and updates its long-term assumptions based on borrower behavior. The company is actively managing a large population facing repayment challenges.

Proactive communication is critical to managing credit quality. For instance, the company recorded a provision for loan losses of $29 million in the second quarter of 2025, partly due to a general reserve build reflecting current delinquency trends. Communication aims to convert potential defaults into manageable repayment plans.

The company also emphasizes financial literacy, a key component of its value proposition, helping borrowers navigate their loan lifecycle. This is a necessary function given the scale of the business, which manages billions in student loan assets.

High-touch relationship management with institutional investors

The relationship with institutional investors is fundamentally different; it is high-touch, data-driven, and focused on capital markets access and governance. Navient Corporation actively manages this by providing detailed financial transparency, which is crucial for maintaining liquidity and funding growth.

This segment relies on clear reporting on the performance of the underlying assets. In the second quarter of 2025, Navient Corporation issued $500 million of unsecured debt and $536 million of asset-backed securities to fund operations and growth. Furthermore, the company maintains a dedicated Investor Relations contact and provides regular updates on its governance and corporate social responsibility efforts to maintain stakeholder confidence.

Shareholder actions also define this relationship, including the repurchase of $24 million of common shares and the payment of $16 million in common stock dividends in Q2 2025, signaling a commitment to returning capital.

Here's a quick look at the scale of customer interactions and relationship focus areas as of mid-2025:

Navient Corporation (NAVI) - Canvas Business Model: Channels

You're looking at how Navient Corporation gets its products and services to its customers and stakeholders as of late 2025. It's a mix of digital directness, capital market access, and outsourced operational execution.

Earnest direct-to-consumer digital origination platform

Navient Corporation uses the Earnest platform to originate new private education loans, focusing heavily on refinancing. This channel is key to their growth strategy in the Consumer Lending segment.

The digital platform supported significant origination volume through the first three quarters of 2025:

• Refinance loan origination volume doubled for the third consecutive quarter in Q3 2025.
• Total originations for the first half of 2025 were over $1 billion, nearly double the first half of 2024.
• Private Education Loans originated in Q2 2025 totaled $500 million.
• Q1 2025 refinance originations reached $508 million.
• Navient Corporation was on path to exceed its 2025 origination target of $1.8 billion.
• Borrowers for refinance originations were high-quality, with approximately 55% holding graduate degrees in Q1 2025.

Capital markets for funding via asset-backed securities

Access to capital markets via securitization is Navient Corporation's primary method for term financing of its originated loans. They actively use asset-backed securities (ABS) to fund growth and manage capital structure.

Here are the key capital markets activities reported through Q3 2025:

The structure of these deals involves senior and subordinate notes, with amortizing tranches having average lives from 1 to 10 years. Navient Corporation also noted that total projected loan portfolio undiscounted cash flows after secured financings are $12.2 billion over the next 20 years, which includes ABS.

Investor Relations for communication with shareholders

Navient Corporation communicates its financial performance and strategic direction directly to the investment community through scheduled events and capital return actions.

Recent Investor Relations touchpoints and capital actions include:

• Q3 2025 financial results webcast hosted on October 29, 2025.
• Q4 2025 common stock dividend approved at $0.16 per share on November 12, 2025.
• New Share Repurchase Authority announced as $100 million in the Q3 2025 update.
• Common share repurchase authority remaining outstanding as of Q2 2025 was $52 million.
• Common stock dividends paid in Q2 2025 totaled $16 million.

Third-party loan servicing partner for borrower interaction

Navient Corporation has moved to an outsourced servicing model to align its expense structure with its shrinking legacy portfolio. They created a variable expense model for loan servicing, outsourcing it to a third-party partner starting in July 2024. This was part of a larger strategy to eliminate nearly $400 million in operating expenses.

The portfolio being serviced by third parties primarily consists of legacy loans:

• FFELP loans accounted for $38 billion in the transfer scope.
• Private student loans accounted for $17 billion in the transfer scope.
• The FFELP Loan portfolio size as of December 31, 2024, was $31 billion.

The transition services related to the outsourcing of servicing ended in May 2025. The expense model now aligns with the amortizing legacy portfolio, facilitating corporate expense reduction. To be fair, this channel shift is a defintely major operational change from their historical model. Finance: draft 13-week cash view by Friday.

Navient Corporation (NAVI) - Canvas Business Model: Customer Segments

You're looking at the core groups Navient Corporation serves as of late 2025, which really dictates where they focus their capital and underwriting efforts. It's all about quality and managing the legacy book.

The private loan refinancing segment targets borrowers with demonstrably strong financial profiles. This focus helps Navient Corporation maintain low credit risk in its growing consumer lending portfolio, which is largely managed through its Earnest business.

• High-credit-quality borrowers for private loan refinancing typically have a FICO score above 770.
• The average customer in this segment has an annual income around $200,000.
• The total addressable market for student loan refinancing in 2025 was estimated around $8 billion.
• Navient Corporation originated $528 million in Refinance Loans in the third quarter of 2025.

A significant portion of the refinance originations are concentrated among those who have completed advanced education. This group often carries higher loan balances and is seen as a key growth engine for the Consumer Lending Segment.

• Approximately 55% of refinance originations were to graduate degree holders in Q2 2025.
• In Q3 2025, Navient Corporation originated $260 million in in-school loans.

Holders of legacy Federal Family Education Loan Program (FFELP) loans represent a substantial, non-growth portfolio that generates steady cash flow, supported by a federal guarantee. Navient Corporation owns a significant portion of this book, though servicing is being outsourced.

• The FFELP portfolio owned by Navient Corporation stood at $29 billion as of the third quarter of 2025.
• This portfolio bears a maximum 3 percent loss exposure due to the federal guarantee.
• The company projects total undiscounted cash flows from its loan portfolios, net of secured financings, to be $12.2 billion over the next 20 years as of September 30, 2025.

The financial markets themselves are a key segment, providing the necessary capital structure through debt and equity. Navient Corporation actively engages with institutional investors for both its common stock and its securitized debt offerings.

Here's a quick look at the composition of the equity ownership and recent debt activity targeting investors.

For the institutional investors focused on debt, Navient Corporation continues to issue asset-backed securities backed by its high-quality refinance loans, such as the Navient Refinance Loan Trust (NAVRL) 2025-C, which had a Class A tranche rated Aaa/AAA. The company also reports that Mutual Funds held 57.27% of the stock in November 2025. Finance: draft 13-week cash view by Friday.

Navient Corporation (NAVI) - Canvas Business Model: Cost Structure

The Cost Structure for Navient Corporation centers on managing its substantial loan portfolios, with significant components driven by credit quality, funding costs, and operational efficiency initiatives that have shifted costs to a variable model.

A major element of the cost structure is the Provision for loan losses, which reflects credit risk management. For the Consumer Lending segment in Q3 2025, the provision was a substantial \$155 million, primarily driven by elevated delinquency balances and the forecasted macroeconomic outlook. The total provision for loan losses across all segments for the quarter was \$168 million.

Navient Corporation has actively worked to de-risk and simplify its cost base. A key action was the creation of a variable expense model for loan servicing by outsourcing the servicing of its portfolio to a third-party partner starting July 1, 2024. This move was intended to eliminate fixed servicing costs and align expenses with the amortizing legacy portfolio.

The company's overall efficiency is reflected in its reported Operating Expenses. For the third quarter of 2025, total Operating expenses were reported at \$105 million. This figure includes \$6 million related to transition services provided for strategic initiatives like the loan servicing outsourcing.

The table below summarizes key cost components for Navient Corporation in Q3 2025:

Interest expense on debt and securitized notes is a critical funding cost. As of the end of Q3 2025, Navient Corporation had \$5.3 billion in unsecured debt principal outstanding. This debt structure includes the issuance of \$500,000,000 in 7.875% Senior Notes due 2032 in May 2025, with the first interest payment scheduled for December 15, 2025. While a specific interest expense number for Q3 2025 wasn't detailed, the company noted that updated financing and securitized debt service assumptions were factored into its projections.

The cost associated with generating new business, specifically Marketing and sales expense for loan origination, is variable. In Q3 2025, the Consumer Lending segment saw expenses increase by \$1 million, which was primarily attributed to higher marketing spend supporting the \$788 million in Private Education Loan originations for the quarter.

The company has been aggressively streamlining its structure, aiming to reduce its expense base by more than \$400 million through Phase 1 strategic actions, which included divesting the Business Processing division (government services sold in February 2025) and streamlining shared services infrastructure, reducing headcount by over 80% from year-end 2023 through Q3 2025.

• Variable cost model established for loan servicing via third-party outsourcing.
• Headcount reduced by over 80% from year-end 2023 through Q3 2025.
• Unsecured debt principal outstanding as of 3Q25 was \$5.3 billion.
• Total provision expense for Q3 2025 was \$168 million.

Navient Corporation (NAVI) - Canvas Business Model: Revenue Streams

You're looking at Navient Corporation's revenue streams as of late 2025, which are heavily concentrated in managing and growing its loan portfolios, supplemented by residual service fees from recent divestitures. The primary engine remains the interest earned on its existing and newly originated student loans.

Here's a look at the segment-level profitability from the second quarter of 2025, which gives you a clear picture of the contribution from the two main loan portfolios. Honestly, the Consumer Lending segment is showing better margins, which is a key strategic focus.

The Consumer Lending business, which includes Earnest, is actively growing its origination volume. For the first half of 2025, Navient Corporation achieved over \$1 billion in total loan originations, nearly doubling the volume from the first half of the prior year. This growth directly feeds future interest income and current fee/premium revenue.

Specifically for the private loan portfolio in Q2 2025, you saw:

• Originated Private Education Loans: \$500 million
• Refinance Loan originations: \$443 million
• In-school loan originations: \$57 million

Loan origination fees and premiums on these new private loans are a direct revenue component, distinct from the interest income on the entire outstanding balance. The company is clearly prioritizing the growth of this higher-margin, private-market business.

You should also note the winding down of legacy revenue sources related to strategic shifts. Other revenue from transition services was reported at \$14 million in Q2 2025. This revenue is tied to the outsourcing of servicing and the sales of the healthcare and government services businesses, with the government services transition expected to be mostly complete by the end of 2025.

Looking forward, management's view on overall profitability is anchored by the following projection:

• Full-year Core EPS guidance of \$0.95 to \$1.05

Finance: draft 13-week cash view by Friday.