Will we revisit the outlook at the appropriate time? But we feel really good with our results that we’ve been able to do and April has been a continuation of the first quarter. As far as what we saw from a strength or weakness standpoint on CMO, I’m guessing your question is really around GMV performance, loss performance, really strong across the board. If I look at all the different categories, we talked a little bit about furniture, even though furniture has been under pressure. Furniture and mattresses have been under pressure as well as a category. Our ability to add some of those merchants that Mitch has mentioned has made that category for us as a growth category even in this environment. So, between furniture, auto, jewelry, some of those bigger categories for us, we’re really up across the board on all of those categories.
Performance has been in line with our expectations. Now, conversion is still putting a little bit of headwinds on our loss rates. But early indications of the merchants who’ve converted over to the CMO platform have been really, really strong both from a GMV standpoint and from early read on performance. So, across the board all categories being able to grow GMV at the level that we’ve been growing it with tighter underwriting and lower approval rates is a great story for us and should be a tailwind for us for the rest of the year.
Mitch Fadel: I’d add to that Fahmi and Hoang, well maybe — we’ll maybe lost you a little bit as you think about the commentary Fahmi gave the second quarter of — when we went through all the different components of it and came up on a range between $0.95 and $1.5. So, if you just use the midpoint of that range $1. When the first quarter $0.79, $1, I mean that’s not that’s not enough and then increase from $0.79 to $1. And when you think about how that sequences in the comparables that sequence that — and people say well when’s that going to flow through I mean $0.79 going up to $1, that doesn’t always happen in this industry, whether you look at our numbers or anybody else’s. So, that’s a — there’s a strong trajectory there. So, don’t lose sight of that. I guess my point.
Hoang Nguyen: Got you. And I saw that you guys commented on the early buyout trends for Rent-A-Center, but I mean can you give the same I mean can you give comment on the CMO buyout — early about trend as well I mean I think merchandise sales in CMO was a little bit elevated this quarter. So, just want to get some color on that. thank you.
Fahmi Karam: Thank you. Sure. Yes, as we mentioned Hoang, the early purchase option we think is pretty much normalized to pre-pandemic levels. What we saw this year. If you look at each of the vintage and monthly vintages for the last six seven months, they’ve come in flat to last year if not slightly lower from us a percentage but outcome standpoint of the 90-day buyouts. So, we continue to normalize there. And for the quarter coming into the year with the kind of mid-teens higher portfolio you’re going to have higher merchandise sales from $1 perspective. And we saw that play out in the first quarter. So, merchandise sales were up year over year and that obviously has an impact to our to our gross profit margin. But when we look at it on a vintage-by-vintage basis, it’s very normal to pre-pandemic levels and actually slightly better than it was this time last year. So that trend has continued.
Hoang Nguyen: Got you. Thank you.
Mitch Fadel: Thanks Hoang.
Operator: Thank you. Our next question comes from Derek Sommers at Jefferies.
Derek Sommers: Hey, good morning, everyone. Kind of touched on this a little bit in your commentary on the scheme of growth, but just wondering if you could touch on kind of product category mix at RAC as well, and then kind of trends in the average ticket price across both RAC and Acima.
Mitch Fadel: Yeah. On the ticket price, it was actually down a little bit in Acima, and not surprising in this economy. And, of course, there’s a little bit of deflation out there, too more on the electronic side, but even in furniture, there’s some. So down a little, which is just probably makes the growth that much more impressive, because it’s not ticket. But it didn’t drop a lot, but it is down a little. The mix is, as was mentioned earlier, is all across the board in Acima with — between furniture and jewelry, electronics, appliances and wheel and tire. And same with Rent-A-Center. Rent-A-Center’s ticket is probably a little higher in the first quarter, year-over-year. And that’s a lot of the mix we carry and so forth in what we put in the stores.
But it was only slight. So we’re not getting a lot out of ticket. We’re just getting a lot out of new customers, and it’s pretty much across the board. We did see some — we get asked a lot about the furniture category, and of course, that had the biggest pull forward of demand during the pandemic. But we’ve seen in the first quarter, some of our larger partners, a couple of them have turned positive, comps year-over-year. Of course, that was after two years of negative comps, but at least they’ve turned positive. So we’re starting to see — well, we were talking about that yesterday. We called it some green shoots in there about starting to see some positive. You may have seen the report of, weight trace report this morning was pretty positive on the furniture side of things.
So I think we’re seeing some similar results in furniture where that seems to be coming back. It certainly is at least stabilized and isn’t dropping anymore, I would say. And if anything, it’s actually coming back a little bit.
Derek Sommers: Great. Helpful color there. And then just one more quick one for me. Kind of on the acceptance now, charge off headwind based on your integration commentary there onto Acima. Is it fair to assume that charge off headwind is going to abate over next quarter and two quarters from now that headwind will be gone?
Mitch Fadel: Yeah. I think it’s going to be more the second half of the year than it is next quarter. I think we guided to a better second half than the first half. And so the second quarter loss rate will be similar to the first quarter. And then you’ll start to see a trend down. We still think for the year, we’ll end up pretty flat to where we ended in 2023, somewhere in between the 9% and 9.5% range for the year. So look forward to start winding down now that it’s pretty much fully converted, probably closer to the second half of the year.
Derek Sommers: Perfect. Thank you. That’s all for me.
Mitch Fadel: Thanks, Derek.
Operator: Thank you. One moment for our next question. Our next question comes from Alex Fuhrman at Craig-Hallum Capital Group.
