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SoFi Technologies, Inc. (SOFI)·Q2 2025 Earnings Summary

Executive Summary

  • Q2 2025 delivered record results: GAAP net revenue $0.855B (+43% YoY), adjusted net revenue $0.858B (+44% YoY), adjusted EBITDA $0.249B (+81% YoY), and diluted EPS $0.08; seventh consecutive GAAP-profitable quarter .
  • Mix shift accelerated: fee-based revenue hit a record $377.5M (+72% YoY); Financial Services + Tech Platform combined net revenue reached $472.4M (+74% YoY), now 55% of total .
  • Management raised full-year 2025 guidance: adjusted net revenue ~$3.375B (prior $3.235–$3.310B), adjusted EBITDA ~$$960M (prior $875–$895M), GAAP net income ~$370M (prior $320–$330M), GAAP EPS ~$0.31 (prior $0.27–$0.28) .
  • Corporate action: company priced a ~$1.5B common stock offering at $20.85/share (07/30), adding flexibility for growth investments; dilution overhang may be a near-term trading factor .
  • Catalysts: guidance raise, rapid LPB ramp ($2.4B origination-on-behalf), brand awareness at all-time high (8.5%), and planned blockchain-enabled transfers and return to crypto investing later this year .

What Went Well and What Went Wrong

  • What Went Well

    • Record scale and diversification: “Adjusted net revenue up 44%… driven by record high new members… and an increase in fee-based revenue” — CEO Anthony Noto .
    • Fee-based momentum: total fee-based revenue reached $377.5M (+72% YoY), underpinned by LPB, origination, interchange, and brokerage fees .
    • Strong profitability and operating leverage: adjusted EBITDA margin 29% and incremental adjusted EBITDA margin 43%; all three segments delivered attractive contribution margins .

  • What Went Wrong

    • Student loan charge-offs rose to 0.94% annualized (vs. 0.64% YoY), largely due to servicer transition timing and a purchased portfolio; management expects normalization going forward .
    • Net interest margin declined 15 bps sequentially to 5.86% on modest mix shift (more student loans) despite 11 bps lower cost of funds; management still expects NIM >5% .
    • Tech Platform margin modestly below prior-year: contribution margin 30% vs. 33% last year amid client mix and ramp dynamics, though net revenue grew +15% YoY .

Financial Results

MetricQ4 2024Q1 2025Q2 2025
GAAP Net Revenue ($USD Millions)$734.1 $771.8 $854.9
Adjusted Net Revenue ($USD Millions)$739.1 $770.7 $858.2
Diluted EPS (GAAP) ($)$0.29 $0.06 $0.08
Adjusted EPS (Diluted) ($)$0.05 $0.06 $0.08
Net Income Margin % (GAAP)45% 9% 11%
Adjusted EBITDA Margin %27% 27% 29%
Fee-Based Revenue ($USD Millions)$289.5 $315.4 $377.5
Net Interest Income ($USD Millions)$470.2 $498.7 $517.8
Net Interest Margin %5.91% 6.01% 5.86%

Segment Net Revenue ($USD Millions)

SegmentQ4 2024Q1 2025Q2 2025
Lending$417.8 $413.4 $443.5
Technology Platform$102.8 $103.4 $109.8
Financial Services$256.5 $303.1 $362.5
Corporate/Other($43.0) ($48.2) ($60.9)

KPIs and Operating Metrics

KPIQ4 2024Q1 2025Q2 2025
Members (end of period)10,127,323 10,915,811 11,745,572
Total Products (end of period)14,745,435 15,915,425 17,142,041
Total Deposits ($USD Billions)$26.0 $27.3 $29.5
Fee-Based Revenue ($USD Millions)$289.5 $315.4 $377.5
Total Originations ($USD Billions)$7.18 $7.25 $8.76
Personal Loan Originations ($USD Billions)$5.25 $5.54 $6.97
Student Loan Originations ($USD Billions)$1.35 $1.19 $1.00
Home Loan Originations ($USD Millions)$577 $518 $799
Personal Loans 90-day DQ (on-balance)0.55% 0.46% 0.42%
Personal Loans Annualized Net Charge-offs3.37% 3.31% 2.83%
Financial Services Annualized Rev/Product ($)$81 $88 $98
LPB Originations ($USD Billions, on behalf of others)$1.1 $1.6 $2.4

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Adjusted Net Revenue ($USD Billions)FY 2025$3.235–$3.310 ~$3.375 Raised
Adjusted EBITDA ($USD Millions)FY 2025$875–$895 ~$960 Raised
GAAP Net Income ($USD Millions)FY 2025$320–$330 ~$370 Raised
GAAP EPS ($)FY 2025$0.27–$0.28 ~$0.31 Raised
Tangible Book Value Growth ($USD Millions)FY 2025$585–$600 ~$640 Raised
Members Added (Millions)FY 2025≥2.8 ≥3.0 Raised
Tax Rate (%)FY 202526% 26% Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4’24 and Q1’25)Current Period (Q2’25)Trend
AI initiativesCyberBank Connect and AI-driven support launched; efficiency gains discussed Expanded AI efforts across operations; previewed “Cash Coach” and broader AI coaches roadmap Expanding scope
Crypto/blockchainNo crypto after 2023 transfer of crypto services; product planning emerging Plans to launch blockchain-enabled international transfers and return to crypto investing later this year Re-entry catalyst
Loan Platform Business (LPB)$1.1B (Q4) and $1.6B (Q1) originations; new commitments (Blue Owl, Fortress) $2.4B originations; near-prime expansion; second LPB securitization; pathway to $9.5B annualized originations Accelerating
Funding mix & depositsDeposits grew to $27.3B (Q1); NIM 6.01% Deposits $29.5B; NIM 5.86% sequentially lower; target 85–90% deposit-funded long-term Stable, favorable
Tech Platform clientsNew large-brand deals; government partnership (Direct Express) Banco Nación win; travel/hospitality clients ramping; Chime migration discussed (partial) Diversifying clients
Credit performancePersonal loan DQ improved to 0.55%; charge-offs 3.37% (Q4) Personal loan DQ 0.42%; charge-offs 2.83%; student loan charge-offs higher due to servicer transition and purchased portfolio Improving PL; ST short-term normalization
Home equity productRecord since 2021 in Q4; rising contribution Best quarter to date; ~⅓ of home lending volume; positioned for refinance wave as rates fall Strong momentum

Management Commentary

  • “We accelerated adjusted net revenue growth to 44% year-over-year… driven by record high new members… and an increase in fee-based revenue” — Anthony Noto, CEO .
  • “Adjusted EBITDA was also a record at $249 million and a margin of 29%. Net income was $97 million at a margin of 11%. Earnings per share was $0.08” — Chris Lapointe, CFO .
  • “Both self-serve international money transfers and crypto investing are expected to launch later this year… Crypto is a key area of focus” — CEO .
  • “Right now, we're about 85–90% deposit funded. That's our long-term target” — CFO .
  • “We now expect adjusted net revenue of approximately $3.375 billion… adjusted EBITDA of approximately $960 million… adjusted net income of approximately $370 million… adjusted EPS of approximately $0.31” — CFO .

Q&A Highlights

  • Guidance cadence and medium-term EPS targets: Management expects Q4 > Q3 across metrics and reaffirmed 2026 EPS $0.55–$0.80 with ≥25% CAGR from 2023–2026, noting mix shifts toward LPB and crypto-related opportunities .
  • Tech Platform migration (Chime) and pipeline: Migration not complete; 10 new clients expected to contribute revenue in Q1 2026 vs. Q1 2025 .
  • Funding strategy and ROE: Deposit funding targeted at 85–90%; LPB is capital-light with expanding asset types (student refi, mortgages) envisioned .
  • LPB outlook: Near-prime expansion and multiple partner deals (Fortress, Blue Owl, Edge Focus) support momentum into H2; no specific LPB origination guidance but expect continued growth .
  • Discretionary spend: Elevated investment in engineering/product, Invest (options, margin), crypto (stablecoin opportunity under OCC interpretive letter), and AI; aim to sustain ~30% incremental EBITDA margin over time .

Estimates Context

  • S&P Global Wall Street consensus EPS and revenue estimates for Q2 2025 were unavailable at the time of this analysis; therefore, estimate comparisons are omitted. Where management provided quarterly guidance in Q1 for Q2 ($785–$805M adjusted net revenue; $200–$210M adjusted EBITDA), actuals exceeded those ranges (adjusted net revenue $858.2M; adjusted EBITDA $249.1M) .

Key Takeaways for Investors

  • Guidance raise and beat: Q2 adjusted net revenue and EBITDA exceeded Q1 guidance, and FY 2025 guidance was raised across revenue, EBITDA, net income, EPS, and TBV growth — a positive re-rating catalyst .
  • Diversification flywheel: Non-lending and fee-based streams (LPB, interchange, brokerage, tech services) scaling rapidly; combined Financial Services + Tech Platform now 55% of net revenue .
  • Credit normalization with improving PL metrics: On-balance PL DQ and charge-offs improved; student loan charge-offs elevated due to discrete timing effects expected to normalize .
  • Capital and funding strength: Deposits reached $29.5B; NIM remains healthy (>5% expected); deposit funding targeted at 85–90% supports durable spread income .
  • Strategic optionality via equity raise: ~$1.5B offering enhances balance sheet for accelerated investments (crypto, AI, Invest, LPB) — near-term dilution overhang balanced by long-term growth optionality .
  • Product innovation runway: Home equity strength in high-rate environment; positioning for refi demand when rates decline; AI “Cash Coach” and planned crypto launches add engagement and monetization levers .
  • H2 watch items: LPB growth trajectory, Tech Platform client ramps, Invest monetization (options, margin lending), and execution on crypto/blockchain initiatives will drive narrative and multiples .

Additional Relevant Q2 2025 Press Releases

  • Announced underwritten public offering of ~$1.5B common stock (07/29) and priced the offering at $20.85/share (07/30) .
  • Broader ecosystem partnerships and technology initiatives (e.g., Lightspark for blockchain-enabled transfers) align with planned product launches discussed on the call .