Quick Summary
- goeasy (GSY / EHMEF) plummeted more than 32% Tuesday following disclosure of a roughly C$178M additional charge-off from its LendCare segment during Q4 2025
- Management pulled both Q4 projections and the company’s three-year financial roadmap completely
- Expected net charge-off rate will reach mid-teen percentages in 2026, compared to approximately 12.9% for 2025
- Dividend payments have been eliminated and stock repurchase programs stopped with immediate effect
- Management unveiled a 6-step remediation strategy, featuring new LendCare leadership and reduced auto/powersports lending
Tuesday marked a devastating turning point for goeasy (EHMEF / GSY), the Canadian alternative lender that has struggled through several challenging years. The company disclosed plans to record an additional charge-off totaling approximately C$178 million against its C$5.5 billion gross consumer loan portfolio for the fourth quarter of 2025. An associated write-down of roughly C$55 million for accrued loan interest and fees is also anticipated.
The company projects total net charge-offs for the period will reach approximately C$331 million.
Additionally, goeasy indicated a sequential net expansion of about C$86 million in its credit loss reserve against the gross consumer lending portfolio.
Investors responded swiftly to the cascade of negative developments. EHMEF shares plunged 32% to $57.37 in early trading. North of the border, GSY experienced an even steeper decline of up to 50% on the Toronto Stock Exchange.
For the complete 2025 fiscal year, the net charge-off rate is projected to settle around 12.9%. Company leadership cautioned that credit performance expectations for LendCare loans have deteriorated significantly beyond initial projections, with annual net charge-off rates forecast to escalate into the mid-teen range throughout 2026.
LendCare Division Drives Crisis
The troubles stem primarily from LendCare — a business goeasy purchased in 2021. While the division expanded aggressively, it appears the supporting operational framework failed to keep pace with that expansion.
Management also revealed a reporting methodology flaw. Specific customer payments were being logged as collected while still in the settlement process at month-end — with some ultimately never materializing. This discrepancy also impacted delinquency metrics. The company characterizes the adjustment to rectify this issue as “not material.”
Felix Wu, who assumed interim CFO responsibilities on September 30, 2025, received permanent appointment to the role Tuesday. He stated the organization anticipates “pressure on net charge-offs and higher delinquency reporting for the coming quarters, before an anticipated improvement in 2027.”
Shareholder Returns Eliminated, Forecasts Withdrawn
Alongside the charge-off revelation, goeasy terminated its quarterly dividend distribution immediately and confirmed it would cease all share buyback activity.
The company simultaneously retracted both its fourth-quarter outlook and its multi-year financial projections.
To resolve the LendCare challenges, goeasy introduced a 6-point corrective framework. The plan includes scaling back auto and powersports loan originations through LendCare’s merchant network. Management will also consolidate LendCare and easyfinancial operations into a single unified platform.
Future expansion efforts will pivot toward easyfinancial’s unsecured lending and home equity products offered directly to consumers. The company projects it can achieve approximately C$30 million in annual cost reductions through enhanced operational efficiency.
Farhan Ali Khan has been designated as LendCare’s new division leader.
This crisis follows a period of significant leadership instability. CEO Jason Mullins announced his departure in July 2024. His successor, Dan Rees, exited in December 2025 citing health concerns related to a blood disorder. Patrick Ens, promoted from within, assumed the top position.
Since Mullins revealed his retirement plans in 2024, GSY shares have declined over 60%.
goeasy plans to release complete Q4 2025 financial results following market close on Wednesday, March 25.
