Regional banking company Customers Bancorp (NYSE: CUBI) beat Wall Street’s revenue expectations in Q2 CY2025, with sales up 4.1% year on year to $206.8 million. Its non-GAAP profit of $1.80 per share was 18.3% above analysts’ consensus estimates.
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Customers Bancorp (CUBI) Q2 CY2025 Highlights:
- Net Interest Income: $176.7 million vs analyst estimates of $170.8 million (5.4% year-on-year growth, 3.4% beat)
- Net Interest Margin: 3.3% vs analyst estimates of 3.2% (flat year on year, 10.2 bps beat)
- Revenue: $206.8 million vs analyst estimates of $199 million (4.1% year-on-year growth, 3.9% beat)
- Efficiency Ratio: 51.2% vs analyst estimates of 53.3% (2.1 percentage point beat)
- Adjusted EPS: $1.80 vs analyst estimates of $1.52 (18.3% beat)
- Market Capitalization: $1.98 billion
“We are pleased to share our second quarter results that highlight the company’s continued execution of its strategic priorities and underscore our success in growing franchise value. And importantly, with our customer-centric mindset and commitment to service provided by our extraordinary colleagues, we are here to serve our clients as the business environment continues to evolve,” said Customers Bancorp Chairman and CEO Jay Sidhu.
Company Overview
Originally founded with a "high-tech, high-touch" branch-light banking strategy, Customers Bancorp (NYSE: CUBI) is a bank holding company that provides commercial and consumer banking services through its Customers Bank subsidiary, with a focus on business lending and digital banking.
Sales Growth
From lending activities to service fees, most banks build their revenue model around two income sources. Interest rate spreads between loans and deposits create the first stream, with the second coming from charges on everything from basic bank accounts to complex investment banking transactions.
Over the last five years, Customers Bancorp grew its revenue at an excellent 11.4% compounded annual growth rate. Its growth surpassed the average bank company and shows its offerings resonate with customers, a great starting point for our analysis.
Long-term growth is the most important, but within financials, a half-decade historical view may miss recent interest rate changes and market returns. Customers Bancorp’s recent performance shows its demand has slowed significantly as its annualized revenue growth of 3.3% over the last two years was well below its five-year trend. 
Note: Quarters not shown were determined to be outliers, impacted by outsized investment gains/losses that are not indicative of the recurring fundamentals of the business.
This quarter, Customers Bancorp reported modest year-on-year revenue growth of 4.1% but beat Wall Street’s estimates by 3.9%.
Net interest income made up 92.2% of the company’s total revenue during the last five years, meaning Customers Bancorp lives and dies by its lending activities because non-interest income barely moves the needle.
While banks generate revenue from multiple sources, investors view net interest income as the cornerstone - its predictable, recurring characteristics stand in sharp contrast to the volatility of non-interest income.
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Tangible Book Value Per Share (TBVPS)
Banks profit by intermediating between depositors and borrowers, making them fundamentally balance sheet-driven enterprises. Market participants emphasize balance sheet quality and sustained book value growth when evaluating these institutions.
This is why we consider tangible book value per share (TBVPS) the most important metric to track for banks. TBVPS represents the real, liquid net worth per share of a bank, excluding intangible assets that have debatable value upon liquidation. On the other hand, EPS is often distorted by mergers and flexible loan loss accounting. TBVPS provides clearer performance insights.
Customers Bancorp’s TBVPS grew at an incredible 18% annual clip over the last five years. TBVPS growth has recently decelerated a bit to 15.7% annual growth over the last two years (from $42.04 to $56.24 per share).
Over the next 12 months, Consensus estimates call for Customers Bancorp’s TBVPS to grow by 11% to $62.40, solid growth rate.
Key Takeaways from Customers Bancorp’s Q2 Results
We enjoyed seeing Customers Bancorp beat analysts’ EPS expectations this quarter. We were also glad its revenue outperformed Wall Street’s estimates. Zooming out, we think this quarter featured some important positives. The stock traded up 4.2% to $64 immediately following the results.
Customers Bancorp may have had a good quarter, but does that mean you should invest right now? If you’re making that decision, you should consider the bigger picture of valuation, business qualities, as well as the latest earnings. We cover that in our actionable full research report which you can read here, it’s free.
