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SoFi Technologies, Inc. (SOFI)·Q1 2025 Earnings Summary

Executive Summary

  • Q1 2025 delivered record revenue scale with adjusted net revenue of $770.7M (up 33% YoY) and adjusted EBITDA of $210.3M (27% margin), while GAAP EPS was $0.06 (benefitted by ~$0.01 lower-than-expected tax rate) .
  • Mix shift toward capital-light, fee-based revenue accelerated: fee-based revenue hit a record $315.4M (+67% YoY), while Financial Services and Tech Platform combined net revenue rose 66% YoY to $406.5M .
  • Company raised FY25 guidance across adjusted revenue, adjusted EBITDA, GAAP net income, GAAP EPS, and tangible book value growth, and issued Q2 guidance implying sustained momentum; both signal upside catalysts .
  • Credit and funding remained supportive: personal loan 90-day delinquencies fell to 46 bps (from 55 bps in Q4), annualized charge-offs dipped to 3.31%, deposits grew to $27.3B, and NIM improved to 6.01% .
  • Strategic catalysts: $3.2B expansion of the Loan Platform Business with Fortress/Edge Focus and first securitization using LPB collateral ($697.6M) broaden fee-based liquidity flywheel and support further non-lending revenue growth .

What Went Well and What Went Wrong

  • What Went Well

    • Record top-line and profitability on a non-GAAP basis: adjusted net revenue $770.7M (+33% YoY) and record adjusted EBITDA $210.3M (+46% YoY, 27% margin) .
    • Fee-based engine scaling: fee-based revenue $315.4M (+67% YoY); Financial Services + Tech Platform generated $406.5M (+66% YoY) as mix shifts toward capital-light revenues .
    • Clear execution on LPB and funding: $1.6B of third-party personal loan originations in Q1; $3.2B incremental LPB commitments with Fortress/Edge Focus and a $697.6M securitization of LPB collateral, reinforcing durability of fee-based liquidity channels .
    • Management quote: “We delivered our highest revenue growth rate in five quarters… new records in members, products, and fee-based revenue… We are… increasing our financial guidance for 2025.” – CEO Anthony Noto .

  • What Went Wrong

    • GAAP net income declined YoY to $71.1M from $88.0M primarily as noninterest expense rose with growth investments; GAAP net income margin was 9% vs 14% a year ago .
    • Lending contribution margin stepped down YoY (58% vs 63%), reflecting higher directly attributable expenses and mix; noninterest income in Lending fell YoY as secondary-related/valuation items normalized .
    • Industry macro/volatility risk remains a watch item, but management noted no slowdown in capital markets executions and maintained underwriting discipline; deposit betas historically 65–70% and target 85–90% deposit funding mix maintained .

Financial Results

Consolidated performance vs prior quarters

MetricQ3 2024Q4 2024Q1 2025
Total Net Revenue ($M)$697.1 $734.1 $771.8
Adjusted Net Revenue ($M)$689.4 $739.1 $770.7
Adjusted EBITDA ($M)$186.2 $198.0 $210.3
Adjusted EBITDA Margin (%)27% 27% 27%
GAAP Net Income ($M)$60.7 $332.5 $71.1
GAAP Diluted EPS$0.05 $0.29 $0.06
Fee-based Revenue ($M)$174.0 $289.5 $315.4

Notes: Q4 GAAP net income included large non-recurring tax valuation allowance release; Q1 EPS benefited by ~$0.01 from a lower-than-expected tax rate .

Segment revenue and profitability (sequential)

SegmentQ4 2024 Net Rev ($M)Q1 2025 Net Rev ($M)Q4 2024 Contrib. Profit ($M)Q1 2025 Contrib. Profit ($M)
Lending417.8 413.4 246.0 238.9
Financial Services256.5 303.1 114.9 148.3
Technology Platform102.8 103.4 32.1 30.9

Additional Q1 2025 YoY color by segment:

  • Financial Services net revenue +101% YoY to $303.1M; contribution margin 49% (+24ppt YoY) .
  • Technology Platform net revenue +10% YoY to $103.4M; contribution margin 30% .
  • Lending net revenue +25% YoY to $413.4M; adjusted contribution margin 58% (vs 64% prior-year) .

KPIs and balance/funding/credit

KPIQ3 2024Q4 2024Q1 2025
Members (period-end)9.37M 10.13M 10.92M
Total Products13.65M 14.75M 15.92M
Deposits ($B)$24.4 $26.0 $27.3
Net Interest Margin5.57% 5.91% 6.01%
Personal Loan 90+ DPD (on-balance)0.57% 0.55% 0.46%
Personal Loan NCO (ann.)3.52% 3.37% 3.31%

Originations (Q1 YoY)

MetricQ1 2024Q1 2025YoY
Personal Loans ($M)3,278.9 5,536.8 +69%
Student Loans ($M)751.7 1,191.5 +59%
Home Loans ($M)336.1 517.8 +54%
Total Originations ($M)4,366.7 7,246.1 +66%

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Adjusted Net RevenueFY 2025$3.200–$3.275B $3.235–$3.310B Raised
Adjusted EBITDAFY 2025$845–$865M $875–$895M Raised
GAAP Net IncomeFY 2025$285–$305M $320–$330M Raised
GAAP EPSFY 2025$0.25–$0.27 $0.27–$0.28 Raised
Tangible Book Value GrowthFY 2025~$550–$575M ~$585–$600M Raised
Members AddedFY 2025≥2.8M ≥2.8M Maintained
Adjusted Net RevenueQ2 2025—$785–$805M New
Adjusted EBITDAQ2 2025—$200–$210M New
GAAP Net IncomeQ2 2025—$60–$70M New
GAAP EPSQ2 2025—$0.05–$0.06 New

Earnings Call Themes & Trends

TopicPrevious Mentions (Q3 2024; Q4 2024)Current Period (Q1 2025)Trend
Fee-based revenue mixFee-based revenue $174M; mix lift, capital-light focus Record $315.4M; FS+Tech rev $406.5M (+66% YoY) Accelerating positive mix
Loan Platform Business (LPB)LPB scaled; $1.0B third-party PL in Q3 $1.6B third-party PL in Q1; $96.1M adj. rev; $3.2B new commitments with Fortress/Edge Focus; $697.6M LPB securitization Rapid scaling, strong investor demand
Credit performancePL 90+ DPD fell to 57 bps (Q3), 55 bps (Q4) 46 bps; PL NCO 3.31%; vintages trend below 7–8% loss tolerance Improving sequentially
Deposits and NIMDeposits $24.4B (Q3), $26.0B (Q4); NIM 5.57%→5.91% Deposits $27.3B; NIM 6.01%; deposit APY competitive edge Positive
Tech Platform client diversificationNew deals; government and brands (Q4) Wyndham co-branded debit; Mercantil Banco signed; impact skewed to 2026 Pipeline solid; back-end loaded revenue
Invest platform and altsAdded alts incl. SpaceX exposure (Q4) 2.7M products; UX upgrades; expanded Templum (Anthropic); exploring crypto/blockchain re-entry Engagement improving
Macro/capital marketsGuidance embedded normalized spreads (Q4) Capital markets appetite remained strong despite volatility/tariffs Supportive liquidity
AI/technology initiatives—New AI-driven features (SoFi Expense, SoFi Cash Coach) in development Early build phase

Management Commentary

  • Strategy and guidance: “We delivered our highest revenue growth rate in five quarters… We are… increasing our financial guidance for 2025.” – Anthony Noto, CEO .
  • Profitability drivers: “Adjusted EBITDA… a record $210 million… 27% margin… incremental EBITDA margin was 35%” – Anthony Noto .
  • FS plus LPB momentum: “Financial Services… more than double… revenue… Loan Platform business generated $96 million in adjusted net revenue… origination on behalf of third parties $1.6 billion” – Chris Lapointe, CFO .
  • Capital markets and liquidity: “We sold or transferred over $3 billion of personal and home loans… and executed a $698 million securitization of LPB loans… industry-leading cost of funds” – Chris Lapointe .
  • Funding advantage and APY positioning: “We have an insured depository… and four loan products… unencumbered capability to compete on APY… expect ours to stay top tier” – Anthony Noto .

Q&A Highlights

  • Path to majority fee-based revenue: Management sees fee-based revenue rising above 50% over time, with LPB expansion inside and potentially outside current credit box; crypto/stablecoin could add fee streams in Invest .
  • Tech Platform pipeline: No change despite volatility/tariffs; new wins expected to impact revenue in 2026; increasing inbound for partnerships/acquisitions as rates stabilize .
  • Capital markets strength: Over $3B of loans sold/transferred in Q1; >$12B annualized demand pace; additional $8B+ LPB partnerships underpin growth .
  • Deposit costs and betas: Historical deposit betas 65–70%; target funding mix ~85–90% via member deposits; capacity to manage deposit growth vs loan growth .
  • Underwriting discipline: Early warning dashboards and tiered underwriting allow quick tightening; current indicators do not necessitate changes; credit remains strong .
  • Student loan in-school opportunity: If federal programs recede, SoFi would pursue in-school loans (higher WACC, often co-borrower backed) and later refi relationships .

Estimates Context

  • S&P Global (Capital IQ) consensus for Q1 2025 EPS and revenue was unavailable via our feed at the time of analysis; therefore, we cannot quantify a Street beat/miss for Q1. Instead, results materially exceeded company-issued Q1 guidance (adj. revenue $770.7M vs $725–$745M; adj. EBITDA $210.3M vs $175–$185M; GAAP NI $71.1M vs $30–$40M; GAAP EPS $0.06 vs ~$0.03) .
  • Given FY25 guidance raises, Street estimates may need upward revision for revenue, EBITDA, and GAAP EPS to reflect higher ranges provided (adj. revenue $3.235–$3.310B; adj. EBITDA $875–$895M; GAAP EPS $0.27–$0.28) .

Key Takeaways for Investors

  • Mix pivot is working: record fee-based revenue, LPB scaling, and FS monetization (revenue per product to $88) support multiple expansion as the model becomes less capital intensive .
  • Guidance raise + Q2 outlook point to sustained momentum; near-term trading catalyst likely tied to continued fee-based growth and execution against raised ranges .
  • Credit trends are improving sequentially; delinquency and charge-off metrics continue to drift lower, reducing tail risk and supporting fair value marks .
  • Funding/NIM remain advantages: deposits reached $27.3B; NIM rose to 6.01%; APY competitiveness supported by lending ROEs and bank charter positioning .
  • Tech Platform pipeline is healthy, but revenue impact skews to 2026—investors should weight near-term to FS/LPB/Lending drivers while tracking co-brand and core wins .
  • Strategic optionality: $3.2B LPB commitments and first LPB securitization expand liquidity channels; potential crypto/blockchain re-entry could add medium-term fee levers .
  • Watch list: execution on Invest engagement growth, durability of capital markets demand, and maintaining deposit beta discipline in evolving rate scenarios .