=Alliance Data (ADS) reported earnings on Thur 21 Jul 2016 (b/o)

Alliance Data beats by $0.09, beats on revs; offers mixed Q3 guidance; raises FY16 outlook  :

• Reports Q2 (Jun) earnings of $3.68 per share, $0.09 better than the Capital IQ Consensus of $3.59; revenues rose 16.5% year/year to $1.75 bln vs the $1.64 bln Capital IQ Consensus.
• Co issues mixed guidance for Q3, sees EPS of $4.42 vs. $4.57 Capital IQ Consensus Estimate; sees Q3 revs of $1.78 bln vs. $1.78 bln Capital IQ Consensus Estimate.
• Co raises guidance for FY16, sees EPS of $16.85 (Prior $16.75) vs. $16.78 Capital IQ Consensus Estimate; sees FY16 revs of $7.15 bln (Prior $7.1 bln) vs. $7.09 bln Capital IQ Consensus Estimate.
• "As I have previously indicated, we need three things to happen for this year to really come together. Encouragingly, each is trending in line with or better than expectations. First, Epsilon performed better than anticipated as revenue turned from down 2 percent in the first quarter to up 5 percent in the second quarter, compared to our expectations of a 2 to 3 percent turn. Adjusted EBITDA decreased 9 percent compared to the second quarter of 2015, but improved substantially from the 22 percent decline in the first quarter with an expected flip to positive growth in the third quarter as India comes fully online and redundant costs are eliminated. Second, Card Services' gross yield, which was down 210 basis points in the first quarter, improved dramatically to just 80 basis points down in the second quarter, roughly a quarter ahead of expectations. Third, Card Services' principal loss rate came in as expected at 5.1 percent in the second quarter, 10 basis points better than the first quarter and on track for a 5.0 percent loss rate for the year as per guidance set at the beginning of this year."