What: Shares of Santander Consumer USA (NYSE:SC) dropped more than 16% at the market open today as the company reported third-quarter earnings. Shares have since regained some lost ground, and are now trading down about 12.5%. 

So what: Santander shareholders are learning that it's one thing to beat headline earnings, and another thing to meet broad expectations. This quarter, Santander beat analyst expectations on the bottom line, posting quarterly earnings of $0.62 per share compared to a consensus estimate of $0.51 per share.

Ordinarily, this might be the makings of the kind of beat that sends shares soaring, but it's not all about the bottom line. Santander indicated that it may exit the personal lending business in its press release, and subsequently moved its personal lending portfolio to its "held for sale" bucket.

In reclassifying its portfolio, Santander's net charge-off ratio rocketed to 14.4% this quarter, up from 5.3% as of June 30. Notably, its adjusted net charge-off ratio, which excludes the charge for its personal portfolio, rose to 8.7%, higher than its 5.3% ratio last quarter, but mostly in line with its adjusted NCO ratio of 8.4% a year ago.

Moving the personal portfolio to held-for-sale resulted in an adjustment of the loans' carrying value. In the press release, the company noted that it had to carry the portfolio at the "lower of cost or market" value, resulting in the increase in charge-offs this quarter.

Now what: The future for Santander's portfolio is up in the air. The company left it to the imagination, saying only that it was "exploring strategic alternatives" for its personal lending business in its third-quarter presentation.

It did, however, change its 2016 outlook to emphasize that there could be a "timing gap" between when it sells its personal lending portfolio and when it reinvests the capital in car loans, resulting in a drag on its earnings next year. Given the size of Santander's $2.3 billion portfolio, investors should expect to hear much more about its plan in the coming days and weeks.

Jordan Wathen has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.