# NELNET INC (NNI)

Informational only - not investment advice.

CIK: 0001258602
SIC: 6141 Personal Credit Institutions
SIC breadcrumb: [Finance, Insurance, And Real Estate](/division/H/) > [SIC Major Group 61](/major-group/61/) > [SIC 6141 Personal Credit Institutions](/industry/6141/)
Latest 10-K filed: 2026-02-26
SEC page: https://www.sec.gov/edgar/browse/?CIK=1258602
Filing source: https://www.sec.gov/Archives/edgar/data/1258602/000125860226000014/nni-20251231.htm

## At a glance

FY2025 · period end 2025-12-31 · filed 2026-02-26 · accession 0001258602-26-000014 · source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001258602.json

| Metric | Value | FY | Provenance |
| --- | ---: | ---: | --- |
| Revenue | 851,459,000 USD | 2025 | verified |
| Net income | 428,474,000 USD | 2025 | verified |
| Assets | 14,063,783,000 USD | 2025 | verified |
| Free cash flow | 396,747,000 USD | 2025 | computed |
| Net margin | 50.32% | 2025 | computed |
| Revenue YoY | -12.53% | 2025 | computed |
| ROE | 11.63% | 2025 | computed |

Computed values are grepcent-computed from the verified facts above and may differ from ratios the company itself reports. Free cash flow = operating cash flow − capital expenditures. Net margin = net income ÷ revenue. Revenue YoY = FY2025 revenue ÷ FY2024 revenue − 1 (consecutive fiscal years only). ROE = net income ÷ period-end stockholders' equity.

No market price, no rating, no forecast on this site. Not investment advice.

### Peer percentile fingerprint

| Ratio | NNI | Peer median | Percentile | N |
| --- | ---: | ---: | ---: | ---: |
| Net margin | 50.3% | 11.6% | 100 | 12 |
| Revenue growth | -12.5% | 9.5% | 0 | 12 |
| FCF margin | 46.6% | 44.6% | 71 | 8 |
| ROE | 11.6% | 13.7% | 36 | 12 |
| ROA | 3.0% | 2.4% | 73 | 12 |
| Liabilities / equity | 2.85 | 4.65 | 27 | 12 |

Percentile = share of the N covered peers reporting that ratio whose value is lower (ties counted half); computed among grepcent-covered companies in SIC industry 6141 Personal Credit Institutions, not the whole market. A higher percentile means a higher value of the ratio, not a better company. Ratios with fewer than 8 reporting peers are omitted. Latest reported values per company; fiscal periods may differ. Descriptive arithmetic - not a score, rating, or ranking.

## Selected Fundamentals
| Metric | Value | Unit | FY | Filed |
| --- | ---: | --- | ---: | --- |
| Revenue | 851459000 | USD | 2025 | 2026-02-26 |
| Net income | 428474000 | USD | 2025 | 2026-02-26 |
| Assets | 14063783000 | USD | 2025 | 2026-02-26 |

## Financials

Annual standardized facts from SEC companyfacts as of latest extracted filing date 2026-02-26. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001258602.json. Derived margins, ratios, and free cash flow are computed from the extracted annual SEC facts.

| Metric | 2010 | 2011 | 2012 | 2013 | 2014 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| Revenue |  |  |  |  |  | 760,746,000 | 770,426,000 | 924,266,000 | 948,677,000 | 619,656,000 | 523,835,000 | 742,806,000 | 1,109,800,000 | 973,399,000 | 851,459,000 |
| Net income |  |  |  |  |  | 256,751,000 | 173,166,000 | 227,913,000 | 141,803,000 | 352,443,000 | 393,286,000 | 406,899,000 | 89,826,000 | 184,045,000 | 428,474,000 |
| Diluted EPS | 3.81 | 4.23 | 3.74 |  |  |  |  |  | 3.54 | 9.02 | 10.20 | 10.82 | 2.40 | 5.02 | 11.79 |
| Operating cash flow |  |  |  |  |  | 300,188,000 | 322,267,000 | 270,892,000 | 298,915,000 | 349,100,000 | 480,328,000 | 683,060,000 | 432,027,000 | 662,890,000 | 422,985,000 |
| Capital expenditures |  |  |  |  |  | 67,602,000 | 156,005,000 | 125,023,000 | 92,499,000 | 113,312,000 | 58,952,000 | 59,421,000 | 74,052,000 | 20,903,000 | 26,238,000 |
| Dividends paid |  |  |  |  |  |  | 24,097,000 | 26,839,000 | 29,485,000 | 31,778,000 | 34,457,000 | 36,608,000 | 39,419,000 | 40,836,000 | 42,993,000 |
| Share buybacks |  |  |  |  |  | 69,091,000 | 68,896,000 | 45,331,000 | 40,411,000 | 73,358,000 | 58,111,000 | 97,685,000 | 28,028,000 | 83,290,000 | 69,346,000 |
| Assets |  |  |  |  |  | 27,193,095,000 | 23,964,435,000 | 25,220,968,000 | 23,708,970,000 | 22,646,160,000 | 21,678,041,000 | 19,355,256,000 | 16,712,384,000 | 13,777,753,000 | 14,063,783,000 |
| Liabilities |  |  |  |  | 28,372,465,000 |  | 21,799,048,000 | 22,906,189,000 | 21,317,876,000 | 20,017,811,000 | 18,725,203,000 | 16,174,142,000 | 13,512,277,000 | 10,478,636,000 | 10,486,554,000 |
| Stockholders' equity |  |  |  | 1,443,662,000 | 1,725,448,000 |  |  | 2,304,464,000 | 2,386,712,000 | 2,632,042,000 | 2,951,206,000 | 3,198,959,000 | 3,253,751,000 | 3,349,762,000 | 3,685,792,000 |
| Cash and cash equivalents |  |  |  |  |  | 69,654,000 | 66,752,000 | 121,347,000 | 133,906,000 | 121,249,000 | 125,563,000 | 118,146,000 | 168,112,000 | 194,518,000 | 295,983,000 |
| Free cash flow |  |  |  |  |  | 232,586,000 | 166,262,000 | 145,869,000 | 206,416,000 | 235,788,000 | 421,376,000 | 623,639,000 | 357,975,000 | 641,987,000 | 396,747,000 |

### Ratios

ROE and ROA use period-end equity/assets. Liabilities / equity uses total liabilities divided by stockholders' equity. Current ratio uses current assets divided by current liabilities when both are reported.

| Metric | 2010 | 2011 | 2012 | 2013 | 2014 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| Net margin |  |  |  |  |  | 33.75% | 22.48% | 24.66% | 14.95% | 56.88% | 75.08% | 54.78% | 8.09% | 18.91% | 50.32% |
| Return on equity |  |  |  |  |  |  |  | 9.89% | 5.94% | 13.39% | 13.33% | 12.72% | 2.76% | 5.49% | 11.63% |
| Return on assets |  |  |  |  |  | 0.94% | 0.72% | 0.90% | 0.60% | 1.56% | 1.81% | 2.10% | 0.54% | 1.34% | 3.05% |
| Liabilities / equity |  |  |  |  | 16.44 |  |  | 9.94 | 8.93 | 7.61 | 6.34 | 5.06 | 4.15 | 3.13 | 2.85 |

## As-reported value updates

3 tracked differences above grepcent's stated thresholds were found between the earliest XBRL-filed value and the value currently on file for the same fiscal period.

Ledger: /company/NNI/revisions/


## Quarterly

Quarterly standardized facts from SEC companyfacts as of latest extracted filing date 2026-08-06. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001258602.json.

Flow metrics use discrete quarter-length periods from 10-Q/10-Q/A filings. Q4 revenue and net income are derived only when annual FY and nine-month YTD facts exist for the same fiscal year; derived Q4 values are labeled. EPS Q4 is not derived.

| Quarter | End date | Revenue | Net income | Diluted EPS | Method |
| --- | --- | ---: | ---: | ---: | --- |
| 2022-Q3 | 2022-09-30 |  |  | 2.80 | reported discrete quarter |
| 2023-Q1 | 2023-03-31 |  |  | 0.71 | reported discrete quarter |
| 2023-Q2 | 2023-06-30 |  |  | 0.75 | reported discrete quarter |
| 2023-Q3 | 2023-09-30 | 284,551,000 | 45,332,000 | 1.21 | reported discrete quarter |
| 2023-Q4 | 2023-12-31 | 275,253,000 | -8,554,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2024-Q1 | 2024-03-31 | 268,802,000 | 73,210,000 | 1.97 | reported discrete quarter |
| 2024-Q2 | 2024-06-30 | 242,866,000 | 45,091,000 | 1.23 | reported discrete quarter |
| 2024-Q3 | 2024-09-30 | 240,483,000 | 2,388,000 | 0.07 | reported discrete quarter |
| 2024-Q4 | 2024-12-31 | 221,249,000 | 63,159,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2025-Q1 | 2025-03-31 | 207,828,000 | 82,560,000 | 2.26 | reported discrete quarter |
| 2025-Q2 | 2025-06-30 | 212,289,000 | 181,459,000 | 4.97 | reported discrete quarter |
| 2025-Q3 | 2025-09-30 | 205,958,000 | 106,684,000 | 2.94 | reported discrete quarter |
| 2025-Q4 | 2025-12-31 | 225,384,000 | 57,771,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2026-Q1 | 2026-03-31 | 211,226,000 | 71,126,000 | 1.97 | reported discrete quarter |
| 2026-Q2 | 2026-06-30 | 204,913,000 | 66,662,000 | 1.85 | reported discrete quarter |

## Filed narrative (10-K & 10-Q)

## Business

Verbatim Item 1 Business section from NNI's latest 10-K: [/company/NNI/business/](/company/NNI/business/).

## Risk Factors

Verbatim Item 1A Risk Factors from NNI's latest 10-K: [/company/NNI/risk-factors/](/company/NNI/risk-factors/).

## Latest quarter (10-Q)

Latest 10-Q source: https://www.sec.gov/Archives/edgar/data/1258602/000125860226000042/nni-20260630.htm

Extracted structurally from real Item 2 body heading to real Item 3/4 boundary.
Confidence: high
Filing date: 2026-08-06
Report date: 2026-06-30

ITEM 2.  MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(Management’s Discussion and Analysis of Financial Condition and Results of Operations is for the three and six months ended June 30, 2026 and 2025. All dollars are in thousands, except per share amounts, unless otherwise noted.)

The following discussion and analysis provides information that the Company’s management believes is relevant to an assessment and understanding of the consolidated results of operations and financial condition of the Company. The discussion and analysis should be read in conjunction with the Company’s consolidated financial statements included in the 2025 Annual Report.

34

Forward-looking and cautionary statements

This report contains forward-looking statements and information that are based on management's current expectations as of the date of this document. Statements that are not historical facts, including statements about the Company's plans and expectations for future financial condition, results of operations or economic performance, or that address management's plans and objectives for future operations, and statements that assume or are dependent upon future events, are forward-looking statements. The words “anticipate,” “assume,” “believe,” “continue,” “could,” “ensure,” “estimate,” “expect,” "focus," “forecast,” “future,” “intend,” “may,” "objective," “plan,” “potential,” “predict,” "pursue," “scheduled,” “should,” "strategy," “will,” “would,” and similar expressions, as well as statements in future tense, are intended to identify forward-looking statements.

The forward-looking statements are based on assumptions and analyses made by management in light of management's experience and its perception of historical trends, current conditions, expected future developments, and other factors that management believes are appropriate under the circumstances. These statements are subject to known and unknown risks, uncertainties, assumptions, and other factors that may cause the actual results and performance to be materially different from any future results or performance expressed or implied by such forward-looking statements. These factors include, among others, the risks and uncertainties set forth in the “Risk Factors” section of the 2025 Annual Report and include such risks and uncertainties as:

•risks related to the ability to successfully maintain and increase allocated volumes of student loans serviced by the Company under existing and future servicing contracts with the Department, risks related to unfavorable contract modifications or interpretations, risks related to consistently meeting service requirements to avoid the assessment of performance penalties, and risks related to the Company's ability to comply with agreements with third-party customers for the servicing of Federal Direct Loan Program, Canadian, FFEL Program, private education, and consumer loans;

•loan portfolio risks such as credit risk, prepayment risk, interest rate basis and repricing risk, risks related to the use of derivatives to manage exposure to interest rate fluctuations, uncertainties regarding the expected benefits from purchased securitized and unsecuritized FFELP, private education, consumer, and other loans, or residual interests therein, and initiatives to purchase additional FFELP, private education, consumer, and other loans;

•financing and liquidity risks, including risks of changes in the interest rate environment;

•risks from changes in the terms of education loans and in the educational credit and services markets resulting from changes in applicable laws, regulations, and government programs and budgets;

•risks related to a breach of or failure in the Company's operational or information systems or infrastructure, or those of third-party vendors, including disclosure of confidential or personal information and/or damage to reputation resulting from cyber breaches;

•risks related to use of artificial intelligence;

•uncertainties inherent in forecasting future cash flows from student loan assets, including residual interests therein, and related asset-backed securitizations;

•risks related to the ability of Nelnet Bank to achieve its business objectives and effectively deploy loan and deposit strategies and achieve expected market penetration;

•risks related to the Company's solar tax equity partnerships, including risks of not being able to realize tax credits which remain subject to recapture by taxing authorities and risks from the impact of the enactment of the One Big Beautiful Bill that accelerates the expiration and phase out of solar energy credits;

•risks and uncertainties related to other initiatives (and anticipated income therefrom) including venture capital, real estate, reinsurance, acquisitions, and other activities, including activities that are intended to diversify the Company both within and outside of its historical core education-related businesses;

•risks and uncertainties associated with climate change; and

•risks and uncertainties associated with litigation matters, maintaining compliance with the extensive regulatory requirements applicable to the Company's businesses, and uncertainties inherent in the estimates and assumptions about future events that management is required to make in the preparation of the Company’s consolidated financial statements.

All forward-looking statements contained in this report are qualified by these cautionary statements and are made only as of the date of this document. Although the Company may from time to time voluntarily update or revise its prior forward-looking statements to reflect actual results or changes in the Company's expectations, the Company disclaims any commitment to do so except as required by law.

35

OVERVIEW

The Company is an operating holding company with primary businesses in consumer lending, loan servicing, payments, and technology-enabled services, many of which are focused on serving customers in the education sector. The Company conducts these activities both directly and through its wholly owned and majority-owned subsidiaries, and actively manages and operates its businesses on an integrated basis. Nelnet’s largest operating and technology platforms support loan servicing and education-related technology and payment solutions. A significant portion of the Company’s revenue is derived from net interest income earned on a portfolio of federally insured student loans, a substantial portion of which is serviced by the Company.

The Company has also broadened its operating business mix both within and beyond its historical education-focused activities. These businesses include banking and other financial services conducted through the Company’s bank and other subsidiaries, asset management and related customer-facing servicing, real estate development and management, reinsurance operations, renewable energy development, and selected strategic interests in early-stage, emerging growth, and other operating enterprises. The Company actively manages such businesses and holds interests in them for strategic and operational purposes.

GAAP Net Income and Non-GAAP Net Income, Excluding Adjustments

The Company prepares its financial statements and presents its financial results in accordance with GAAP. However, it also provides additional non-GAAP financial information related to specific items management believes to be important in the evaluation of its operating results and performance. A reconciliation of the Company's GAAP net income to Non-GAAP net income excluding derivative market value adjustments, and a discussion of why the Company believes providing this additional information is useful to investors, are provided below.

[[GREPCENT_TABLE]]
[["","Three months ended June 30,","","Six months ended June 30,"],["","2026","","2025","","2026","","2025"],["GAAP net income attributable to Nelnet, Inc.","$","66,662","","","181,459","","","137,788","","","264,018"],["Realized and unrealized derivative market value adjustments (a)","(3,686)","","","3,866","","","(5,273)","","","10,190"],["Tax effect (b)","885","","","(928)","","","1,266","","","(2,446)"],["Non-GAAP net income attributable to Nelnet, Inc., excluding derivative market value adjustments","$","63,861","","","184,397","","","133,781","","","271,762"],["Earnings per share:"],["GAAP net income attributable to Nelnet, Inc.","$","1.85","","","4.97","","","3.82","","","7.24"],["Realized and unrealized derivative market value adjustments (a)","(0.10)","","","0.11","","","(0.15)","","","0.28"],["Tax effect (b)","0.02","","","(0.03)","","","0.04","","","(0.07)"],["Non-GAAP net income attributable to Nelnet, Inc., excluding derivative market value adjustments","$","1.77","","","5.05","","","3.71","","","7.45"]]
[[/GREPCENT_TABLE]]

(a) "Derivative market value adjustments" includes both the realized portion of gains and losses (corresponding to variation margin received or paid on derivative instruments that are settled daily at a central clearinghouse) and the unrealized portion of gains and losses that are caused by changes in fair values of derivatives which do not qualify for "hedge treatment" under GAAP. "Derivative market value adjustments" does not include "derivative settlements" that represent the cash paid or received during the respective period to settle with derivative instrument counterparties the economic effect of the Company's derivative instruments based on their contractual terms.

The accounting for derivatives requires that changes in the fair value of derivative instruments be recognized currently in earnings, with no fair value adjustment of the hedged item, unless specific hedge accounting criteria are met. Management has structured all of the Company’s derivative transactions with the intent that each is economically effective; however, the majority of the Company’s derivative instruments do not qualify for hedge accounting in the consolidated financial statements. As a result, the change in fair value for the derivative instruments that do not qualify for hedge accounting is reported in current period earnings with no consideration for the corresponding change in fair value of the hedged item. Under GAAP, the cumulative net realized and unrealized gain or loss caused by changes in fair values of derivatives in which the Company plans to hold to maturity will generally equal zero over the life of the contract. However, the net realized and unrealized gain or loss during any given reporting period fluctuates significantly from period to period.

The Company believes these point-in-time estimates of asset and liability values related to its derivative instruments that are subject to interest rate fluctuations are subject to volatility mostly due to timing and market factors beyond the control of management, and affect the period-to-period comparability of the results of operations. Accordingly, the Company’s management utilizes operating results excluding these items for comparability purposes when making decisions regarding the Company’s performance and in presentations with credit rating agencies, lenders, and investors. Consequently, the Company reports this non-GAAP information because the Company believes that it provides additional information regarding operational and performance indicators that are closely assessed by management and represents what earnings would have been had these derivatives qualified for hedge accounting. There is no comprehensive, authoritative guidance for the presentation of such non-GAAP information, which is only meant to supplement GAAP results by providing additional information that management utilizes to assess performance.

(b)The tax effects are calculated by multiplying the realized and unrealized derivative market value adjustments by the applicable statutory income tax rate.

36

Operating Segments

The Company's reportable operating se

[Excerpt truncated for page length; source filing is linked above.]

## Latest 10-K MD&A (excerpt)

Latest 10-K Item 7 source: https://www.sec.gov/Archives/edgar/data/1258602/000125860226000014/nni-20251231.htm
Complete FY 2025 MD&A: /company/NNI/mda/fy2025/

Extracted structurally from real Item 7 body heading to real Item 7A/8 boundary.
Confidence: high
Filing date: 2026-02-26
Report date: 2025-12-31

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(Management’s Discussion and Analysis of Financial Condition and Results of Operations is for the years ended December 31, 2025 and 2024. All dollars are in thousands, except share amounts, unless otherwise noted.)

The following discussion and analysis provides information that the Company’s management believes is relevant to an assessment and understanding of the consolidated results of operations and financial condition of the Company. The discussion and analysis should be read in conjunction with the Company’s consolidated financial statements and related notes included in this report. This discussion and analysis contains forward-looking statements subject to various risks and uncertainties and should be read in conjunction with the disclosures and information contained in "Forward-Looking and Cautionary Statements" and Item 1A "Risk Factors" included in this report.

A discussion related to the results of operations and changes in financial condition for the year ended December 31, 2025 compared with the year ended December 31, 2024 is presented below. A discussion related to the results of operations and changes in financial condition for the year ended December 31, 2024 compared with the year ended December 31, 2023 can be found in Part II, Item 7. "Management's Discussion and Analysis of Financial Condition and Results of Operations" in the Company's 2024 Annual Report on Form 10-K, which was filed with the United States Securities and Exchange Commission on February 27, 2025.

OVERVIEW

The Company is an operating holding company with primary businesses in consumer lending, loan servicing, payments, and technology-enabled services, many of which are focused on serving customers in the education sector. The Company conducts these activities both directly and through its wholly owned and majority-owned subsidiaries, and actively manages and operates its businesses on an integrated basis. Nelnet’s largest operating and technology platforms support loan servicing and education-related technology and payment solutions. A significant portion of the Company’s revenue is derived from net interest income earned on a portfolio of federally insured student loans, a substantial portion of which is serviced by the Company.

The Company has also broadened its operating business mix both within and beyond its historical education-focused activities. These businesses include banking and other financial services conducted through the Company’s bank and other subsidiaries, asset management and related customer-facing servicing, real estate development and management, reinsurance operations, renewable energy development, and selected strategic interests in early-stage, emerging growth, and other operating enterprises. The Company actively manages such businesses and holds interests in them for strategic and operational purposes.

The Company was formed as a Nebraska corporation in 1978 to service federal student loans for two local banks. The Company built on this initial foundation as a servicer to become a leading originator, holder, and servicer of federal student loans, principally consisting of loans originated under the FFEL Program.

The Reconciliation Act of 2010 discontinued new loan originations under the FFEL Program, effective July 1, 2010, and requires all new federal student loan originations be made directly by the Department through the Federal Direct Loan Program. This law does not alter or affect the terms and conditions of existing FFELP loans. Subsequent to the Reconciliation Act of 2010, the Company no longer originates FFELP loans. However, a significant portion of the Company's income continues to be derived from its existing FFELP student loan portfolio. Interest income on the Company's existing FFELP loan portfolio will decline over time as the portfolio is paid down. To reduce its reliance on interest income from FFELP loans, the Company has expanded its services and products. This expansion has been accomplished through internal growth and innovation as well as acquisitions. The Company is also actively expanding its private education, consumer, and other loan portfolios, or residual

33

interests therein, and as part of this strategy launched Nelnet Bank in 2020. In addition, the Company has been servicing federally owned student loans for the Department since 2009.

GAAP Net Income and Non-GAAP Net Income, Excluding Adjustments

The Company prepares its financial statements and presents its financial results in accordance with GAAP. However, it also provides additional non-GAAP financial information related to specific items management believes to be important in the evaluation of its operating results and performance. A reconciliation of the Company's GAAP net income to Non-GAAP net income excluding derivative market value adjustments, and a discussion of why the Company believes providing this additional information is useful to investors, are provided below.

[[GREPCENT_TABLE]]
[["","Year ended December 31,"],["","2025","","2024"],["GAAP net income attributable to Nelnet, Inc.","$","428,474","","","184,045"],["Realized and unrealized derivative market value adjustments (a)","9,098","","","(10,124)"],["Tax effect (b)","(2,184)","","","2,430"],["Non-GAAP net income attributable to Nelnet, Inc., excluding derivative market value adjustments","$","435,388","","","176,351"],["Earnings per share:"],["GAAP net income attributable to Nelnet, Inc.","$","11.79","","","5.02"],["Realized and unrealized derivative market value adjustments (a)","0.25","","","(0.28)"],["Tax effect (b)","(0.06)","","","0.07"],["Non-GAAP net income attributable to Nelnet, Inc., excluding derivative market value adjustments","$","11.98","","","4.81"]]
[[/GREPCENT_TABLE]]

(a)    "Derivative market value adjustments" includes both the realized portion of gains and losses (corresponding to variation margin received or paid on derivative instruments that are settled daily at a central clearinghouse) and the unrealized portion of gains and losses that are caused by changes in fair values of derivatives which do not qualify for "hedge treatment" under GAAP. "Derivative market value adjustments" does not include "derivative settlements" that represent the cash paid or received during the respective period to settle with derivative instrument counterparties the economic effect of the Company's derivative instruments based on their contractual terms.

The accounting for derivatives requires that changes in the fair value of derivative instruments be recognized currently in earnings, with no fair value adjustment of the hedged item, unless specific hedge accounting criteria are met. Management has structured all of the Company’s derivative transactions with the intent that each is economically effective; however, the majority of the Company’s derivative instruments do not qualify for hedge accounting in the consolidated financial statements. As a result, the change in fair value for the derivative instruments that do not qualify for hedge accounting is reported in current period earnings with no consideration for the corresponding change in fair value of the hedged item. Under GAAP, the cumulative net realized and unrealized gain or loss caused by changes in fair values of derivatives in which the Company plans to hold to maturity will generally equal zero over the life of the contract. However, the net realized and unrealized gain or loss during any given reporting period fluctuates significantly from period to period.

The Company believes these point-in-time estimates of asset and liability values related to its derivative instruments that are subject to interest rate fluctuations are subject to volatility mostly due to timing and market factors beyond the control of management, and affect the period-to-period comparability of the results of operations. Accordingly, the Company’s management utilizes operating results excluding these items for comparability purposes when making decisions regarding the Company’s performance and in presentations with credit rating agencies, lenders, and investors. Consequently, the Company reports this non-GAAP information because the Company believes that it provides additional information regarding operational and performance indicators that are closely assessed by management and represents what earnings would have been had these derivatives qualified for hedge accounting. There is no comprehensive, authoritative guidance for the presentation of such non-GAAP information, which is only meant to supplement GAAP results by providing additional information that management utilizes to assess performance.

(b)    The tax effects are calculated by multiplying the realized and unrealized derivative market value adjustments by the applicable statutory income tax rate.

Operating Segments

The Company's reportable operating segments are described in note 1 of the notes to consolidated financial statements included in this report. They include:

•Loan Servicing and Systems (LSS) - referred to as Nelnet Diversified Services (NDS)

•Education Technology Services and Payments (ETSP) - referred to as Nelnet Business Services (NBS)

•Asset Generation and Management (AGM), part of the Nelnet Financial Services (NFS) division

•Nelnet Bank, part of the NFS division

The Company earns fee-based revenue through its NDS and NBS reportable operating segments. The Company earns net interest income on its loan portfolio, consisting primarily of FFELP loans, through its AGM reportable operating segment. This

34

segment is expected to generate significant amounts of cash as the FFELP portfolio amortizes. The Company actively works to maximize the amount and timing of cash flows generated from its FFELP portfolio and seeks to acquire additional loan assets to leverage its servicing scale and expertise to generate incremental earnings and cash flow. Nelnet Bank operates as an internet industrial bank franchise focused on the private education and unsecured consumer loan markets, with a home office in Salt Lake City, Utah.

The NFS division was formed to focus on the Company’s key objective to maximize the amount and timing of cash flows generated from its FFELP portfolio and reposition itself for the post-FFELP environment by expanding its private education, consumer, and other loan portfolios. In addition to AGM and Nelnet Bank being part of the NFS division, NFS’s other operating segments that are not reportable include the operating results of:

•Nelnet Insurance Services, which primarily includes multiple reinsurance treaties on property and casualty policies

•Whitetail Rock Capital Management, LLC (WRCM), the Company's U.S. Securities and Exchange Commission (SEC)-registered investment advisor subsidiary

•The Company’s ownership and activities in real estate

•The Company’s ownership and management of its bond portfolio (primarily student loan and other asset-backed securities)

Other business activities and operating segments that are not reportable and not part of the NFS division are combined and included in Corporate and Other Activities ("Corporate"). Corporate includes the following items:

•Shared service activities related to human resources, accounting, legal, enterprise risk management, information technology, occupancy, and marketing. These costs are allocated to each operating segment based on estimated use of such activities and services

•Corporate costs and overhead functions not allocated to operating segments, including executive management, innovation initiatives, and other holding company organizational costs

•The operating results of the Company’s participation in renewable energy solar developments through tax equity structures and administrative and management services provided by the Company on solar tax equity investments made by third parties

•The oper

[Excerpt truncated for page length; the complete text is on the linked full-MD&A page.]

Read the full FY 2025 MD&A: /company/NNI/mda/fy2025/
All MD&A years: /company/NNI/mda/


## MD&A history

Prior-year 10-K MD&A spans are extracted from SEC filings with the same bounded parser used for the latest filing. Each year's full verbatim text is on its own sub-page.

- [FY 2024 MD&A](/company/NNI/mda/fy2024/): filed 2025-02-27; accession 0001258602-25-000014 (https://www.sec.gov/Archives/edgar/data/1258602/000125860225000014/nni-20241231.htm)
- [FY 2023 MD&A](/company/NNI/mda/fy2023/): filed 2024-02-27; accession 0001258602-24-000024 (https://www.sec.gov/Archives/edgar/data/1258602/000125860224000024/nni-20231231.htm)
- [FY 2022 MD&A](/company/NNI/mda/fy2022/): filed 2023-02-28; accession 0001258602-23-000026 (https://www.sec.gov/Archives/edgar/data/1258602/000125860223000026/nni-20221231.htm)
- [FY 2021 MD&A](/company/NNI/mda/fy2021/): filed 2022-02-28; accession 0001258602-22-000024 (https://www.sec.gov/Archives/edgar/data/1258602/000125860222000024/nni-20211231.htm)




## Macro cross-references

Indicators mapped to this company's SIC classification (industry 6141 Personal Credit Institutions) by grepcent's deterministic macro-sector crosswalk. A navigational mapping, not a statistical or causal claim.

- [M2SL](/indicator/M2SL/): M2
- [FEDFUNDS](/indicator/FEDFUNDS/): Federal Funds Effective Rate
- [DFEDTARU](/indicator/DFEDTARU/): Federal Funds Target Range - Upper Limit
- [DGS2](/indicator/DGS2/): Market Yield on U.S. Treasury Securities at 2-Year Constant Maturity
- [DGS10](/indicator/DGS10/): Market Yield on U.S. Treasury Securities at 10-Year Constant Maturity
- [T10Y2Y](/indicator/T10Y2Y/): 10-Year Treasury Constant Maturity Minus 2-Year Treasury Constant Maturity
- [HOUST](/indicator/HOUST/): New Privately-Owned Housing Units Started: Total Units
- [PERMIT](/indicator/PERMIT/): New Privately-Owned Housing Units Authorized in Permit-Issuing Places: Total Units

Macro-to-micro threads including this sector: [Interest rates & the Fed](/thread/interest-rates-fed/), [Money & trade](/thread/money-trade/), [Consumer & credit](/thread/consumer-credit/), [Government finances](/thread/government-finances/), [Sector employment](/thread/sector-employment/).

All macro indicators: /indicators/


## For LLMs & downloads

Markdown twin: /company/NNI.md · JSON record: /company/NNI.json · verified financials: /company/NNI/financials.json / /company/NNI/financials.csv · machine TOC for the whole site: /llms.txt