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SoFi Technologies, Inc. Reports Second Quarter 2023 Results

Record GAAP and Adjusted Net Revenue for Second Quarter 2023

 GAAP Net Revenue of $498 Million Up 37%; $489 Million Adjusted Net Revenue Up 37% Year-over-Year

Record Adjusted EBITDA of $77 Million Up 278% Year-over-Year

New Member Adds of Over 584,000; Quarter-End Total Members Up 44% Year-over-Year to Over 6.2 Million

New Product Adds of Nearly 847,000; Quarter-End Total Products Up 43% Year-over-Year to Over 9.4 Million Total Deposit Growth of $2.7 Billion, Up 26% During the Second Quarter to $12.7 Billion

Management Raises Full-Year 2023 Guidance

SoFi Technologies, Inc. (NASDAQ: SOFI), a member-centric, one-stop shop for digital financial services that helps members borrow, save, spend, invest and protect their money, reported financial results today for its second quarter ended June 30, 2023.

This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20230731284667/en/

Members (In Thousands), Products (In Thousands) (Graphic: Business Wire)

Members (In Thousands), Products (In Thousands) (Graphic: Business Wire)

“We delivered another quarter of record financial results and generated our ninth consecutive quarter of record adjusted net revenue, which was up 37% year-over-year. Record revenue at the company level was driven by record revenue in both our Technology Platform business segment and our Financial Services business segment coupled with continued strong Lending business segment revenue growth. We also generated our fourth consecutive quarter of record adjusted EBITDA of $77 million, representing a 43% incremental adjusted EBITDA margin and a 16% margin overall, as well as a 36% incremental GAAP net income margin,” said Anthony Noto, CEO of SoFi Technologies, Inc.

Consolidated Results Summary

 

Three Months Ended June 30,

 

 

($ in thousands, except per share amounts)

 

2023

 

2022

 

% Change

Consolidated GAAP

 

 

 

 

 

 

Total net revenue

 

$

498,018

 

 

$

362,527

 

 

37

%

Net loss

 

 

(47,549

)

 

 

(95,835

)

 

(50

)%

Net loss attributable to common stockholders – basic and diluted(1)

 

 

(57,628

)

 

 

(105,914

)

 

(46

)%

Loss per share attributable to common stockholders – basic and diluted

 

 

(0.06

)

 

 

(0.12

)

 

(50

)%

 

 

 

 

 

 

 

Consolidated – Non-GAAP

 

 

 

 

 

 

Adjusted net revenue(2)

 

$

488,815

 

 

$

356,091

 

 

37

%

Adjusted EBITDA(2)

 

 

76,819

 

 

 

20,304

 

 

278

%

___________________

(1)

Adjusted for the contractual amount of dividends payable to holders of Series 1 redeemable preferred stock, which are participating interests.

(2)

Adjusted net revenue and adjusted EBITDA are non-GAAP financial measures. For more information and reconciliations to the most comparable GAAP measures, see “Non-GAAP Financial Measures” and Table 2 to the “Financial Tables” herein.

Noto continued: “Our record number of member additions and strong momentum in product and cross-buy adds, along with improving operating efficiency, reflects the benefits of our broad product suite and unique Financial Services Productivity Loop (FSPL) strategy. We added over 584,000 new members during the second quarter, and ended with over 6.2 million total members, up 44% year-over-year. We also added nearly 847,000 new products during the second quarter, and ended with over 9.4 million total products, a 43% annual increase.”

Noto concluded: “Total deposits grew by $2.7 billion, up 26% during the second quarter to $12.7 billion at quarter-end, and over 90% of SoFi Money deposits (inclusive of Checking and Savings and cash management accounts) are from direct deposit members. For new direct deposit accounts opened in the second quarter, the median FICO score was 747. More than half of newly funded SoFi Money accounts are setting up direct deposit by day 30, and this has had a significant impact on debit spending, with continued strong cross-buy trends from this attractive member base into Lending and other Financial Services products. With our launch of offering FDIC insurance of up to $2 million, nearly 98% of our deposits were insured at quarter end.

As a result of this growth in high quality deposits, we have benefited from a lower cost of funding for our loans. Our deposit funding also increases our flexibility to capture additional net interest margin (NIM) and optimize returns, a critical advantage in light of notable macro uncertainty. SoFi Bank, N.A. generated $63.1 million of GAAP net income at a 17% margin.”

Consolidated Results

Second quarter total GAAP net revenue increased 37% to $498.0 million from the prior-year period's $362.5 million. Second quarter adjusted net revenue of $488.8 million was up 37% from the same prior-year period's $356.1 million. Second quarter record adjusted EBITDA of $76.8 million increased 278% from the same prior year period's $20.3 million.

SoFi hit a number of key financial inflection points in the quarter, including adjusted EBITDA exceeding share-based compensation expense of $75.9 million for the second consecutive quarter. Additionally, SoFi improved contribution loss in the Financial Services segment to $4 million versus $24 million in the first quarter of 2023 and $54 million in the second quarter of 2022. The improvement in the Financial Services business segment contribution loss reinforces the company’s confidence in achieving positive contribution profit in all three business segments by year end, as well as overall GAAP profitability for the company for the fourth quarter of 2023. SoFi recorded a GAAP net loss of $47.5 million for the second quarter of 2023, an improvement from the prior-year period's net loss of $95.8 million.

Member and Product Growth

SoFi achieved strong year-over-year growth in both members and products in the second quarter of 2023. Record new member additions of over 584,000 brought total members to over 6.2 million by quarter-end, up over 1.9 million, or 44%, from the end of 2022's second quarter.

New product additions of nearly 847,000 in the second quarter brought total products to over 9.4 million at quarter-end, up 43% from 6.6 million at the same prior year quarter-end.

In the Financial Services segment, total products increased by 47% year-over-year, to 7.9 million from 5.4 million in the second quarter of 2022. SoFi Money (inclusive of Checking and Savings and cash management accounts) grew 47% year-over-year to 2.7 million products, SoFi Invest grew 18% year-over-year to 2.3 million products, and SoFi Relay grew 90% year-over-year to 2.6 million products.

Lending products increased 25% year-over-year to 1.5 million products, driven primarily by continued record growth in personal loans.

Technology Platform enabled accounts increased by 11% year-over-year to 129.4 million.

Lending Segment Results

Lending segment GAAP and adjusted net revenues were $331.4 million and $322.2 million, respectively, for the second quarter of 2023, both up 29% compared to the second quarter of 2022. Higher loan balances and net interest margin expansion drove strong growth in net interest income.

Lending segment second quarter contribution profit of $183.3 million increased 29% from $142.0 million in the same prior-year period. Contribution margin using Lending adjusted net revenue remained healthy at 57% in both the second quarter of 2023 and the same prior-year period. These advances reflect SoFi’s ability to capitalize on continued strong demand for its lending products.

​Lending – Segment Results of Operations

 

 

Three Months Ended June 30,

 

 

($ in thousands)

 

2023

 

2022

 

% Change

Net interest income

 

$

231,885

 

 

$

114,003

 

 

103

%

Noninterest income

 

 

99,556

 

 

 

143,114

 

 

(30

)%

Total net revenue – Lending

 

 

331,441

 

 

 

257,117

 

 

29

%

Servicing rights – change in valuation inputs or assumptions

 

 

(8,601

)

 

 

(9,098

)

 

(5

)%

Residual interests classified as debt – change in valuation inputs or assumptions

 

 

(602

)

 

 

2,662

 

 

n/m

 

Directly attributable expenses

 

 

(138,929

)

 

 

(108,690

)

 

28

%

Contribution Profit

 

$

183,309

 

 

$

141,991

 

 

29

%

 

 

 

 

 

 

 

Adjusted net revenue – Lending(1)

 

$

322,238

 

 

$

250,681

 

 

29

%

___________________

(1)

Adjusted net revenue – Lending represents a non-GAAP financial measure. For more information and a reconciliation to the most comparable GAAP measure, see “Non-GAAP Financial Measures” and Table 2 to the “Financial Tables” herein.

Lending – Loans Held for Sale

Personal Loans

 

Student Loans

 

Home Loans

 

Total

June 30, 2023

 

 

 

 

 

 

 

Unpaid principal

$

12,171,935

 

$

5,262,975

 

$

87,928

 

 

$

17,522,838

Accumulated interest

 

82,868

 

 

21,164

 

 

150

 

 

 

104,182

Cumulative fair value adjustments(1)

 

496,360

 

 

99,782

 

 

(9,495

)

 

 

586,647

Total fair value of loans(2)

$

12,751,163

 

$

5,383,921

 

$

78,583

 

 

$

18,213,667

March 31, 2023

 

 

 

 

 

 

 

Unpaid principal

$

10,039,769

 

$

5,086,953

 

$

89,782

 

 

$

15,216,504

Accumulated interest

 

69,049

 

 

20,787

 

 

162

 

 

 

89,998

Cumulative fair value adjustments(1)

 

428,181

 

 

132,319

 

 

(8,897

)

 

 

551,603

Total fair value of loans(2)

$

10,536,999

 

$

5,240,059

 

$

81,047

 

 

$

15,858,105

___________________

(1)

The cumulative fair value adjustments for personal loans during the three months ended June 30, 2023 were primarily impacted by higher origination volume, partially offset by lower fair value marks driven primarily by a higher discount rate, while the cumulative fair value adjustments for student loans were primarily impacted by a higher weighted average discount rate and higher prepayment rate assumption, which also resulted in lower fair value marks.

(2)

Each component of the fair value of loans is impacted by charge-offs during the period. Our fair value assumption for annual default rate incorporates fair value markdowns on loans beginning when they are 10 days or more delinquent, with additional markdowns at 30, 60 and 90 days past due.

The following table summarizes the significant inputs to the fair value model for personal and student loans:

 

Personal Loans

 

Student Loans

 

June 30, 2023

 

March 31, 2023

 

June 30, 2023

 

March 31, 2023

Weighted average coupon rate(1)

13.6

%

 

13.2

%

 

5.0

%

 

4.9

%

Weighted average annual default rate

4.6

 

 

4.6

 

 

0.5

 

 

0.4

 

Weighted average conditional prepayment rate

19.0

 

 

19.1

 

 

10.6

 

 

10.4

 

Weighted average discount rate

6.1

 

 

5.5

 

 

4.4

 

 

4.1

 

___________________​​

(1)

Represents the average coupon rate on loans held on balance sheet, weighted by unpaid principal balance outstanding at the balance sheet date.

Second quarter Lending segment total origination volume increased 37% year-over-year, as a result of continued strong demand for personal loans.

Record personal loan originations of over $3.7 billion in the second quarter of 2023 were up $1.3 billion, or 51%, year-over-year, and rose 27% sequentially. This strong performance was aided by years of investment in technology to automate and accelerate the application-to-approval process for qualified borrowers and constant testing of risk controls and underwriting models to maintain high credit quality and strong returns. Second quarter student loan volume of over $395 million continued to reflect the uncertainty around federal student loan payments. Second quarter home loan volume of over $243 million was down 27% year-over-year, but nearly tripled sequentially, as we began to benefit from the technology platform and overall loan capacity from our acquisition at the beginning of the quarter.

​Lending – Originations and Average Balances

 

 

Three Months Ended June 30,

 

 

 

2023

 

2022

 

% Change

Origination volume ($ in thousands, during period)

 

 

 

 

 

 

Personal loans

 

$

3,740,981

 

$

2,471,849

 

51

%

Student loans

 

 

395,367

 

 

398,722

 

(1

)%

Home loans

 

 

243,123

 

 

332,047

 

(27

)%

Total

 

$

4,379,471

 

$

3,202,618

 

37

%

 

 

 

 

 

 

 

Average loan balance ($, as of period end)(1)

 

 

 

 

 

 

Personal loans

 

$

23,767

 

$

24,421

 

(3

)%

Student loans

 

 

45,523

 

 

48,474

 

(6

)%

Home loans

 

 

277,077

 

 

287,205

 

(4

)%

_________________

(1)

Within each loan product category, average loan balance is defined as the total unpaid principal balance of the loans divided by the number of loans that have a balance greater than zero dollars as of the reporting date. Average loan balance includes loans on the balance sheet and transferred loans with which SoFi has a continuing involvement through its servicing agreements.

​Lending – Products

 

June 30,

 

 

 

 

2023

 

2022

 

% Change

Personal loans

 

985,396

 

714,735

 

38

%

Student loans

 

491,499

 

462,164

 

6

%

Home loans

 

26,997

 

25,128

 

7

%

Total lending products

 

1,503,892

 

1,202,027

 

25

%

Technology Platform Segment Results

Technology Platform segment record net revenue of $87.6 million for the second quarter of 2023 increased 4% year-over-year and 13% sequentially, and includes strong contribution from Galileo, which had 9% sequential revenue growth, and continued strong contribution from Technisys, which had 21% sequential revenue growth. Contribution profit of $17.2 million decreased 21% year-over-year, for a margin of 20%, which improved modestly from the prior quarter. We are seeing strong adoption of new products, including Konecta, our AI natural language customer service bot, and our Payments Risk Platform (PRP), a platform which leverages transactional data to reduce transaction fraud.

Technology Platform – Segment Results of Operations

 

Three Months Ended June 30,

 

 

($ in thousands)

 

2023

 

2022

 

% Change

Total net revenue – Technology Platform

 

$

87,623

 

 

$

83,899

 

 

4

%

Directly attributable expenses

 

 

(70,469

)

 

 

(62,058

)

 

14

%

Contribution Profit

 

$

17,154

 

 

$

21,841

 

 

(21

)%

Technology Platform total enabled client accounts increased 11% year-over-year, to 129.4 million from 116.6 million. We have made great progress on our strategy to sign larger, more durable clients. Galileo signed 5 new clients in the second quarter of 2023, all of which have existing installed bases, and Technisys went live with 4 new clients. Additionally, we have a robust pipeline of ongoing discussions with potential partners with large existing customer bases across both the U.S. and Latin America spanning both the financial services and non-financial services segments.

​Technology Platform

 

June 30,

 

 

 

 

2023

 

2022

 

% Change

Total accounts

 

129,356,203

 

116,570,038

 

11

%

Financial Services Segment Results

Financial Services segment record net revenue increased 223% in the second quarter of 2023 to $98.1 million from the prior year period's total of $30.4 million, helped by 188% growth in segment interchange revenue and 477% growth in net interest income. Strength in the segment results was driven by SoFi Money along with contributions from SoFi Invest, SoFi Protect, SoFi Credit Card, and lending-as-a-service.

Importantly, Financial Services segment contribution loss was $4.3 million, reflecting a $49.4 million improvement over the prior-year quarter's $53.7 million loss, as well as our second consecutive quarter of positive variable profit in the segment. This came as a result of continued improvement in monetization for the segment, along with increasing operating leverage as we efficiently scale the business. Annualized revenue per product of $50 more than doubled year-over-year and grew 9% sequentially.

Financial Services – Segment Results of Operations

 

Three Months Ended June 30,

 

 

($ in thousands)

 

2023

 

2022

 

% Change

Net interest income

 

$

74,637

 

 

$

12,925

 

 

477

%

Noninterest income

 

 

23,415

 

 

 

17,438

 

 

34

%

Total net revenue – Financial Services

 

 

98,052

 

 

 

30,363

 

 

223

%

Directly attributable expenses

 

 

(102,399

)

 

 

(84,063

)

 

22

%

Contribution loss

 

$

(4,347

)

 

$

(53,700

)

 

(92

)%

By continuously innovating with new and relevant offerings, features and rewards for members, SoFi grew total Financial Services products by 2.5 million, or 47%, year-over-year in the second quarter of 2023, bringing the total to 7.9 million at quarter-end. In the second quarter of 2023, SoFi Money products increased by over 280,000, SoFi Invest products increased by nearly 105,000 and Relay products increased by over 347,000.

Most notably, our Checking and Savings offering has an APY of up to 4.40% as of July 31, 2023, no minimum balance requirement nor balance limits, a host of free features and a unique rewards program. Total deposits grew 26% during the second quarter to $12.7 billion at quarter-end, and over 90% of SoFi Money deposits (inclusive of Checking and Savings and cash management accounts) are from direct deposit members. More than half of newly funded SoFi Money accounts were setting up direct deposit by day 30 in the second quarter of 2023.

​Financial Services – Products

 

June 30,

 

 

 

 

2023

 

2022

 

% Change

Money(1)

 

2,693,148

 

1,837,138

 

47

%

Invest

 

2,315,777

 

1,961,425

 

18

%

Credit Card

 

213,395

 

139,781

 

53

%

Referred loans(2)

 

47,439

 

28,037

 

69

%

Relay

 

2,553,158

 

1,344,538

 

90

%

At Work

 

74,216

 

51,228

 

45

%

Total financial services products

 

7,897,133

 

5,362,147

 

47

%

___________________​​

(1)

 

Includes SoFi Checking and Savings accounts held at SoFi Bank, and cash management accounts.

(2)

 

Limited to loans wherein we provide third party fulfillment services.

Guidance and Outlook

Management expects to generate $1.025 to $1.085 billion of adjusted net revenue in the second half of 2023, up 19% to 26% year-over-year, and $180 to $190 million of adjusted EBITDA.

For the full year 2023, management expects adjusted net revenue of $1.974 to $2.034 billion, up from its prior guidance of $1.955 to $2.02 billion, and full-year adjusted EBITDA of $333 to $343 million, up from its prior guidance of $268 to $288 million, representing a 40-44% incremental adjusted EBITDA margin. Management projects that a more significant portion of the second half adjusted net revenue and adjusted EBITDA results will be generated during the fourth quarter. As the company moves toward expected GAAP net income profitability in the fourth quarter, management expects share-based compensation and depreciation and amortization expenses to be slightly higher than reported second quarter 2023 levels in both the third and fourth quarters of the year.

Management will further address second half and full-year 2023 guidance on the quarterly earnings conference call. Management has not reconciled forward-looking non-GAAP measures to their most directly comparable GAAP measures of total net revenue, net income and gross margin. This is because the company cannot predict with reasonable certainty and without unreasonable efforts the ultimate outcome of certain GAAP components of such reconciliations due to market-related assumptions that are not within our control as well as certain legal or advisory costs, tax costs or other costs that may arise. For these reasons, management is unable to assess the probable significance of the unavailable information, which could materially impact the amount of the future directly comparable GAAP measures.

Earnings Webcast

SoFi’s executive management team will host a live audio webcast beginning at 8:00 a.m. Eastern Time (5:00 a.m. Pacific Time) today to discuss the quarter’s financial results and business highlights. All interested parties are invited to listen to the live webcast at https://investors.sofi.com. A replay of the webcast will be available on the SoFi Investor Relations website for 30 days. Investor information, including supplemental financial information, is available on SoFi’s Investor Relations website at https://investors.sofi.com.

Cautionary Statement Regarding Forward-Looking Statements

Certain of the statements above are forward-looking and as such are not historical facts. This includes, without limitation, statements regarding our expectations for the second half of 2023 and full year adjusted net revenue and adjusted EBITDA, our expectations regarding the profitability of our three business segments, our expectations regarding our ability to continue to grow our business, improve our financials and increase our member, product and total accounts count, our ability to navigate the macroeconomic environment and the financial position, business strategy and plans and objectives of management for our future operations. These forward-looking statements are not guarantees of performance. Such statements can be identified by the fact that they do not relate strictly to historical or current facts. Words such as “continue”, “expect”, “may”, “strategy”, “will be”, “will continue”, and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Factors that could cause actual results to differ materially from those contemplated by these forward-looking statements include: (i) the effect of and uncertainties related to macroeconomic factors such as fluctuating inflation and interest rates; (ii) our ability to achieve profitability, operating efficiencies and continued growth across our three businesses in the future, as well as our ability to achieve GAAP net income profitability in the fourth quarter of 2023 and expected GAAP net income margins; (iii) the impact on our business of the regulatory environment and complexities with compliance related to such environment, including any impact on our Lending segment of the ending of the federal student loan payment moratorium or loan forgiveness; (iv) our ability to realize the benefits of being a bank holding company and operating SoFi Bank, including continuing to grow high quality deposits and our rewards program for members; (v) our ability to respond and adapt to changing market and economic conditions, including recessionary pressures, inflationary pressures and interest rates; (vi) our ability to continue to drive brand awareness and realize the benefits or our integrated multi-media marketing and advertising campaigns; (vii) our ability to vertically integrate our businesses and accelerate the pace of innovation of our financial products; (viii) our ability to manage our growth effectively and our expectations regarding the development and expansion of our business; (ix) our ability to access sources of capital on acceptable terms or at all, including debt financing and other sources of capital to finance operations and growth; (x) the success of our continued investments in our Financial Services segment and in our business generally; (xi) the success of our marketing efforts and our ability to expand our member base and increase our product adds; (xii) our ability to maintain our leadership position in certain categories of our business and to grow market share in existing markets or any new markets we may enter; (xiii) our ability to develop new products, features and functionality that are competitive and meet market needs; (xiv) our ability to realize the benefits of our strategy, including what we refer to as our FSPL; (xv) our ability to make accurate credit and pricing decisions or effectively forecast our loss rates; (xvi) our ability to establish and maintain an effective system of internal controls over financial reporting; and (xvii) the outcome of any legal or governmental proceedings that may be instituted against us. The foregoing list of factors is not exhaustive. You should carefully consider the foregoing factors and the other risks and uncertainties set forth in the section titled “Risk Factors” in our last quarterly report on Form 10-Q, as filed with the Securities and Exchange Commission, and those that are included in any of our future filings with the Securities and Exchange Commission, including our annual report on Form 10-K, under the Exchange Act.

These forward-looking statements are based on information available as of the date hereof and current expectations, forecasts and assumptions, and involve a number of judgments, risks and uncertainties. Accordingly, forward-looking statements should not be relied upon as representing our views as of any subsequent date, and we do not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

As a result of a number of known and unknown risks and uncertainties, our actual results or performance may be materially different from those expressed or implied by these forward-looking statements. You should not place undue reliance on these forward-looking statements.

Non-GAAP Financial Measures

This press release presents information about our adjusted net revenue and adjusted EBITDA, which are non-GAAP financial measures provided as supplements to the results provided in accordance with accounting principles generally accepted in the United States (GAAP). We use adjusted net revenue and adjusted EBITDA to evaluate our operating performance, formulate business plans, help better assess our overall liquidity position, and make strategic decisions, including those relating to operating expenses and the allocation of internal resources. Accordingly, we believe that adjusted net revenue and adjusted EBITDA provide useful information to investors and others in understanding and evaluating our operating results in the same manner as our management. These non-GAAP measures are presented for supplemental informational purposes only, have limitations as analytical tools, and should not be considered in isolation from, or as a substitute for, the analysis of other GAAP financial measures, such as total net revenue and net income (loss). Other companies may not use these non-GAAP measures or may use similar measures that are defined in a different manner. Therefore, SoFi's non-GAAP measures may not be directly comparable to similarly titled measures of other companies. Reconciliations of these non-GAAP measures to the most directly comparable GAAP financial measures are provided in Table 2 to the “Financial Tables” herein.

Forward-looking non-GAAP financial measures are presented without reconciliations of such forward-looking non-GAAP measures because the GAAP financial measures are not accessible on a forward-looking basis and reconciling information is not available without unreasonable effort due to the inherent difficulty in forecasting and quantifying certain amounts that are necessary for such reconciliations, including adjustments reflected in our reconciliation of historic non-GAAP financial measures, the amounts of which, based on historical experience, could be material.

About SoFi

SoFi (NASDAQ: SOFI) is a member-centric, one-stop shop for digital financial services on a mission to help people achieve financial independence to realize their ambitions. The company’s full suite of financial products and services helps its over 6.2 million SoFi members borrow, save, spend, invest, and protect their money better by giving them fast access to the tools they need to get their money right, all in one app. SoFi also equips members with the resources they need to get ahead – like career advisors, Credentialed Financial Planners (CFP), exclusive experiences and events, and a thriving community – on their path to financial independence.

SoFi innovates across three business segments: Lending, Financial Services – which includes SoFi Checking and Savings, SoFi Invest, SoFi Credit Card, SoFi Protect, and SoFi Insights – and Technology Platform, which offers the only end-to-end vertically integrated financial technology stack. SoFi Bank, N.A., an affiliate of SoFi, is a nationally chartered bank, regulated by the Federal Reserve, OCC, and FDIC. The company is also the naming rights partner of SoFi Stadium, home of the Los Angeles Chargers and the Los Angeles Rams. For more information, visit https://www.sofi.com or download our iOS and Android apps.

Availability of Other Information About SoFi

Investors and others should note that we communicate with our investors and the public using our website (https://www.sofi.com), the investor relations website (https://investors.sofi.com), and on social media (Twitter and LinkedIn), including but not limited to investor presentations and investor fact sheets, Securities and Exchange Commission filings, press releases, public conference calls and webcasts. The information that SoFi posts on these channels and websites could be deemed to be material information. As a result, SoFi encourages investors, the media, and others interested in SoFi to review the information that is posted on these channels, including the investor relations website, on a regular basis. This list of channels may be updated from time to time on SoFi’s investor relations website and may include additional social media channels. The contents of SoFi’s website or these channels, or any other website that may be accessed from its website or these channels, shall not be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended.

FINANCIAL TABLES

1. Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited)

2. Reconciliation of GAAP to Non-GAAP Financial Measures

3. Condensed Consolidated Balance Sheets (Unaudited)

4. Average Balances and Net Interest Earnings Analysis

5. Condensed Consolidated Cash Flow Data (Unaudited)

6. Company Metrics

7. Segment Financials (Unaudited)

Table 1

SoFi Technologies, Inc.

Condensed Consolidated Statements of Operations and Comprehensive Loss

(Unaudited)

(In Thousands, Except for Share and Per Share Data)

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2023

 

2022

 

2023

 

2022

Interest income

 

 

 

 

 

 

Loans

 

$

442,187

 

 

$

145,337

 

 

$

799,529

 

 

$

259,722

 

Securitizations

 

 

2,659

 

 

 

2,567

 

 

 

5,713

 

 

 

5,325

 

Other

 

 

25,150

 

 

 

1,608

 

 

 

36,318

 

 

 

2,877

 

Total interest income

 

 

469,996

 

 

 

149,512

 

 

 

841,560

 

 

 

267,924

 

Interest expense

 

 

 

 

 

 

 

 

Securitizations and warehouses

 

 

63,060

 

 

 

18,599

 

 

 

117,384

 

 

 

38,505

 

Deposits

 

 

106,529

 

 

 

4,543

 

 

 

179,645

 

 

 

4,974

 

Corporate borrowings

 

 

9,167

 

 

 

3,450

 

 

 

17,167

 

 

 

6,099

 

Other

 

 

114

 

 

 

191

 

 

 

228

 

 

 

684

 

Total interest expense

 

 

178,870

 

 

 

26,783

 

 

 

314,424

 

 

 

50,262

 

Net interest income

 

 

291,126

 

 

 

122,729

 

 

 

527,136

 

 

 

217,662

 

Noninterest income

 

 

 

 

 

 

 

 

Loan origination and sales

 

 

103,064

 

 

 

144,414

 

 

 

229,575

 

 

 

302,118

 

Securitizations

 

 

(12,900

)

 

 

(11,737

)

 

 

(16,077

)

 

 

(23,018

)

Servicing

 

 

9,052

 

 

 

10,471

 

 

 

21,794

 

 

 

22,707

 

Technology products and solutions

 

 

82,289

 

 

 

81,670

 

 

 

155,090

 

 

 

141,527

 

Other

 

 

25,387

 

 

 

14,980

 

 

 

52,658

 

 

 

31,875

 

Total noninterest income

 

 

206,892

 

 

 

239,798

 

 

 

443,040

 

 

 

475,209

 

Total net revenue

 

 

498,018

 

 

 

362,527

 

 

 

970,176

 

 

 

692,871

 

Noninterest expense

 

 

 

 

 

 

 

 

Technology and product development

 

 

126,845

 

 

 

99,366

 

 

 

243,904

 

 

 

181,274

 

Sales and marketing

 

 

182,822

 

 

 

143,854

 

 

 

357,976

 

 

 

281,992

 

Cost of operations

 

 

93,885

 

 

 

79,091

 

 

 

177,793

 

 

 

149,528

 

General and administrative

 

 

131,180

 

 

 

125,829

 

 

 

254,869

 

 

 

262,334

 

Provision for credit losses

 

 

12,615

 

 

 

10,103

 

 

 

21,022

 

 

 

23,064

 

Total noninterest expense

 

 

547,347

 

 

 

458,243

 

 

 

1,055,564

 

 

 

898,192

 

Loss before income taxes

 

 

(49,329

)

 

 

(95,716

)

 

 

(85,388

)

 

 

(205,321

)

Income tax benefit (expense)

 

 

1,780

 

 

 

(119

)

 

 

3,417

 

 

 

(871

)

Net loss

 

$

(47,549

)

 

$

(95,835

)

 

$

(81,971

)

 

$

(206,192

)

 

 

 

 

 

 

 

 

 

Loss per share

 

 

 

 

 

 

Loss per share – basic

 

$

(0.06

)

 

$

(0.12

)

 

$

(0.11

)

 

$

(0.26

)

Loss per share – diluted

 

$

(0.06

)

 

$

(0.12

)

 

$

(0.11

)

 

$

(0.26

)

Weighted average common stock outstanding – basic

 

 

936,569,420

 

 

 

910,046,750

 

 

 

932,926,222

 

 

 

881,608,165

 

Weighted average common stock outstanding – diluted

 

 

936,569,420

 

 

 

910,046,750

 

 

 

932,926,222

 

 

 

881,608,165

 

Table 2

Non-GAAP Financial Measures

Reconciliation of Adjusted Net Revenue

Adjusted net revenue is defined as total net revenue, adjusted to exclude the fair value changes in servicing rights and residual interests classified as debt due to valuation inputs and assumptions changes, which relate only to our Lending segment. For our consolidated results and for the Lending segment, we reconcile adjusted net revenue to total net revenue, the most directly comparable GAAP measure, as presented for the periods indicated below:

 

Three Months Ended June 30,

 

Six Months Ended June 30,

($ in thousands)

 

2023

 

2022

 

2023

 

2022

Total net revenue

 

$

498,018

 

 

$

362,527

 

 

$

970,176

 

 

$

692,871

 

Servicing rights – change in valuation inputs or assumptions(1)

 

 

(8,601

)

 

 

(9,098

)

 

 

(20,685

)

 

 

(20,678

)

Residual interests classified as debt – change in valuation inputs or assumptions(2)

 

 

(602

)

 

 

2,662

 

 

 

(513

)

 

 

5,625

 

Adjusted net revenue

 

$

488,815

 

 

$

356,091

 

 

$

948,978

 

 

$

677,818

 

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

($ in thousands)

 

2023

 

2022

 

2023

 

2022

Total net revenue – Lending

 

$

331,441

 

 

$

257,117

 

 

$

668,522

 

 

$

510,106

 

Servicing rights – change in valuation inputs or assumptions(1)

 

 

(8,601

)

 

 

(9,098

)

 

 

(20,685

)

 

 

(20,678

)

Residual interests classified as debt – change in valuation inputs or assumptions(2)

 

 

(602

)

 

 

2,662

 

 

 

(513

)

 

 

5,625

 

Adjusted net revenue – Lending

 

$

322,238

 

 

$

250,681

 

 

$

647,324

 

 

$

495,053

 

___________________​​

(1)

 

Reflects changes in fair value inputs and assumptions on servicing rights, including conditional prepayment, default rates and discount rates. These assumptions are highly sensitive to market interest rate changes and are not indicative of our performance or results of operations. Moreover, these non-cash charges are unrealized during the period and, therefore, have no impact on our cash flows from operations. As such, these positive and negative changes are adjusted out of total net revenue to provide management and financial users with better visibility into the net revenue available to finance our operations and our overall performance.

(2)

 

Reflects changes in fair value inputs and assumptions on residual interests classified as debt, including conditional prepayment, default rates and discount rates. When third parties finance our consolidated securitization VIEs by purchasing residual interests, we receive proceeds at the time of the closing of the securitization and, thereafter, pass along contractual cash flows to the residual interest owner. These residual debt obligations are measured at fair value on a recurring basis, but they have no impact on our initial financing proceeds, our future obligations to the residual interest owner (because future residual interest claims are limited to contractual securitization collateral cash flows), or the general operations of our business. As such, these positive and negative non-cash changes in fair value attributable to assumption changes are adjusted out of total net evenue to provide management and financial users with better visibility into the net revenue available to finance our operations.​

Reconciliation of Adjusted EBITDA

Adjusted EBITDA is defined as net income (loss), adjusted to exclude, as applicable: (i) corporate borrowing-based interest expense (our adjusted EBITDA measure is not adjusted for warehouse or securitization-based interest expense, nor deposit interest expense and finance lease liability interest expense, as these are not direct operating expenses), (ii) income tax expense (benefit), (iii) depreciation and amortization, (iv) share-based expense (inclusive of equity-based payments to non-employees), (v) impairment expense (inclusive of goodwill impairment and property, equipment and software abandonments), (vi) transaction-related expenses, (vii) fair value changes in warrant liabilities, (viii) fair value changes in each of servicing rights and residual interests classified as debt due to valuation assumptions, and (ix) other charges, as appropriate, that are not expected to recur and are not indicative of our core operating performance. We reconcile adjusted EBITDA to net loss, the most directly comparable GAAP measure, for the periods indicated below:

 

Three Months Ended June 30,

 

Six Months Ended June 30,

($ in thousands)

 

2023

 

2022

 

2023

 

2022

Net loss

 

$

(47,549

)

 

$

(95,835

)

 

$

(81,971

)

 

$

(206,192

)

Non-GAAP adjustments:

 

 

 

 

 

 

 

 

Interest expense – corporate borrowings(1)

 

 

9,167

 

 

 

3,450

 

 

 

17,167

 

 

 

6,099

 

Income tax (benefit) expense(2)

 

 

(1,780

)

 

 

119

 

 

 

(3,417

)

 

 

871

 

Depreciation and amortization(3)

 

 

50,130

 

 

 

38,056

 

 

 

95,451

 

 

 

68,754

 

Share-based expense

 

 

75,878

 

 

 

80,142

 

 

 

140,104

 

 

 

157,163

 

Restructuring charges(4)

 

 

 

 

 

 

 

 

4,953

 

 

 

 

Impairment expense(5)

 

 

 

 

 

 

 

 

1,243

 

 

 

 

Transaction-related expense(6)

 

 

176

 

 

 

808

 

 

 

176

 

 

 

17,346

 

Servicing rights – change in valuation inputs or assumptions(7)

 

 

(8,601

)

 

 

(9,098

)

 

 

(20,685

)

 

 

(20,678

)

Residual interests classified as debt – change in valuation inputs or assumptions(8)

 

 

(602

)

 

 

2,662

 

 

 

(513

)

 

 

5,625

 

Total adjustments

 

 

124,368

 

 

 

116,139

 

 

 

234,479

 

 

 

235,180

 

Adjusted EBITDA

 

$

76,819

 

 

$

20,304

 

 

$

152,508

 

 

$

28,988

 

___________________​​

(1)

 

Our adjusted EBITDA measure adjusts for corporate borrowing-based interest expense, as these expenses are a function of our capital structure. Corporate borrowing-based interest expense includes interest on our revolving credit facility and the amortization of debt discount and debt issuance costs on our convertible notes. Revolving credit facility interest expense in the 2023 periods increased due to higher interest rates relative to the prior year periods on identical outstanding debt.

(2)

 

Income taxes were primarily attributable to tax expense associated with the profitability of SoFi Bank in state jurisdictions where separate filings are required. For the three and six month 2023 periods, this expense was more than offset by income tax benefits from foreign losses in jurisdictions with net deferred tax liabilities related to Technisys.

(3)

Depreciation and amortization expense for the 2023 periods increased compared to the 2022 periods primarily in connection with acquisitions and growth in our internally-developed software balance.

(4)

Restructuring charges in the six-month 2023 period primarily included employee-related wages, benefits and severance associated with a small reduction in headcount in our Technology Platform segment in the first quarter of 2023, which do not reflect expected future operating expenses and are not indicative of our core operating performance.

(5)

Impairment expense in the six-month 2023 period relates to a sublease arrangement, which is not indicative of our core operating performance.

(6)

Transaction-related expenses in the 2023 and 2022 periods included financial advisory and professional services costs associated with our acquisition of Wyndham and Technisys, respectively.

(7)

Reflects changes in fair value inputs and assumptions, including market servicing costs, conditional prepayment, default rates and discount rates. This non-cash change is unrealized during the period and, therefore, has no impact on our cash flows from operations. As such, these positive and negative changes in fair value attributable to assumption changes are adjusted out of net loss to provide management and financial users with better visibility into the earnings available to finance our operations.

(8)

Reflects changes in fair value inputs and assumptions, including conditional prepayment, default rates and discount rates. When third parties finance our consolidated VIEs through purchasing residual interests, we receive proceeds at the time of the securitization close and, thereafter, pass along contractual cash flows to the residual interest owner. These obligations are measured at fair value on a recurring basis, which has no impact on our initial financing proceeds, our future obligations to the residual interest owner (because future residual interest claims are limited to contractual securitization collateral cash flows), or the general operations of our business. As such, these positive and negative non-cash changes in fair value attributable to assumption changes are adjusted out of net loss to provide management and financial users with better visibility into the earnings available to finance our operations. ​

Table 3

SoFi Technologies, Inc.

Condensed Consolidated Balance Sheets

(Unaudited)

(In Thousands, Except for Share Data)

 

June 30,

2023

 

December 31,

2022

Assets

 

 

 

Cash and cash equivalents

 

$

3,015,652

 

 

$

1,421,907

 

Restricted cash and restricted cash equivalents

 

 

485,476

 

 

 

424,395

 

Investment securities (includes available-for-sale securities of $382,782 and $195,438 at fair value with associated amortized cost of $387,815 and $203,418, as of June 30, 2023 and December 31, 2022, respectively)

 

 

548,232

 

 

 

396,769

 

Loans held for sale, at fair value

 

 

18,213,667

 

 

 

13,557,074

 

Loans held for investment (less allowance for credit losses on loans at amortized cost of $41,227 and $40,788, as of June 30, 2023 and December 31, 2022, respectively)

 

 

347,551

 

 

 

307,957

 

Servicing rights

 

 

145,663

 

 

 

149,854

 

Property, equipment and software

 

 

191,352

 

 

 

170,104

 

Goodwill

 

 

1,640,679

 

 

 

1,622,991

 

Intangible assets

 

 

412,099

 

 

 

442,155

 

Operating lease right-of-use assets

 

 

94,523

 

 

 

97,135

 

Other assets (less allowance for credit losses of $1,937 and $2,785, as of June 30, 2023 and December 31, 2022, respectively)

 

 

466,555

 

 

 

417,334

 

Total assets

 

$

25,561,449

 

 

$

19,007,675

 

Liabilities, temporary equity and permanent equity

 

 

 

 

Liabilities:

 

 

 

 

Deposits:

 

 

 

 

Interest-bearing deposits

 

$

12,672,392

 

 

$

7,265,792

 

Noninterest-bearing deposits

 

 

67,681

 

 

 

76,504

 

Total deposits

 

 

12,740,073

 

 

 

7,342,296

 

Accounts payable, accruals and other liabilities

 

 

632,459

 

 

 

516,215

 

Operating lease liabilities

 

 

115,224

 

 

 

117,758

 

Debt

 

 

6,484,326

 

 

 

5,485,882

 

Residual interests classified as debt

 

 

11,332

 

 

 

17,048

 

Total liabilities

 

 

19,983,414

 

 

 

13,479,199

 

Commitments, guarantees, concentrations and contingencies

 

 

 

 

Temporary equity:

 

 

 

 

Redeemable preferred stock, $0.00 par value: 100,000,000 and 100,000,000 shares authorized; 3,234,000 and 3,234,000 shares issued and outstanding as of June 30, 2023 and December 31, 2022, respectively

 

 

320,374

 

 

 

320,374

 

Permanent equity:

 

 

 

 

Common stock, $0.00 par value: 3,100,000,000 and 3,100,000,000 shares authorized; 948,912,761 and 933,896,120 shares issued and outstanding as of June 30, 2023 and December 31, 2022, respectively

 

 

94

 

 

 

93

 

Additional paid-in capital

 

 

6,848,178

 

 

 

6,719,826

 

Accumulated other comprehensive loss

 

 

(5,119

)

 

 

(8,296

)

Accumulated deficit

 

 

(1,585,492

)

 

 

(1,503,521

)

Total permanent equity

 

 

5,257,661

 

 

 

5,208,102

 

Total liabilities, temporary equity and permanent equity

 

$

25,561,449

 

 

$

19,007,675

Table 4

SoFi Technologies, Inc.

Average Balances and Net Interest Earnings Analysis

 

 

Three Months Ended June 30, 2023

 

Three Months Ended June 30, 2022

($ in thousands)

 

Average

Balances

 

Interest

Income/Expense

 

Average

Yield/Rate

 

Average

Balances

 

Interest

Income/Expense

 

Average

Yield/Rate

Assets

 

 

 

 

 

 

 

 

 

 

 

 

Interest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing deposits with banks

 

$

2,158,973

 

$

24,127

 

4.48

%

 

$

1,064,672

 

$

943

 

0.35

%

Investment securities

 

 

387,453

 

 

3,682

 

3.81

 

 

 

505,840

 

 

3,004

 

2.38

 

Loans

 

 

17,810,656

 

 

442,187

 

9.96

 

 

 

7,804,416

 

 

145,337

 

7.45

 

Total interest-earning assets

 

 

20,357,082

 

 

469,996

 

9.26

%

 

 

9,374,928

 

 

149,284

 

6.37

%

Total noninterest-earning assets

 

 

2,862,005

 

 

 

 

 

 

3,011,591

 

 

 

 

Total assets

 

$

23,219,087

 

 

 

 

 

$

12,386,519

 

 

 

 

Liabilities, Temporary Equity and Permanent Equity

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

Demand deposits

 

$

2,071,639

 

$

12,922

 

2.50

%

 

$

1,137,097

 

$

2,654

 

0.93

%

Savings deposits

 

 

7,292,617

 

 

73,114

 

4.02

 

 

 

673,561

 

 

1,863

 

1.11

 

Time deposits

 

 

1,708,576

 

 

20,493

 

4.81

 

 

 

17,660

 

 

26

 

0.59

 

Total interest-bearing deposits

 

 

11,072,832

 

 

106,529

 

3.86

 

 

 

1,828,318

 

 

4,543

 

0.99

 

Warehouse facilities

 

 

3,204,559

 

 

48,080

 

6.02

 

 

 

2,093,373

 

 

9,717

 

1.86

 

Securitization debt

 

 

908,381

 

 

10,770

 

4.76

 

 

 

547,049

 

 

5,204

 

3.81

 

Other debt

 

 

1,642,953

 

 

13,491

 

3.29

 

 

 

1,643,944

 

 

6,091

 

1.48

 

Total debt

 

 

5,755,893

 

 

72,341

 

5.04

 

 

 

4,284,366

 

 

21,012

 

1.96

 

Residual interests classified as debt

 

 

13,015

 

 

 

 

 

 

61,388

 

 

1,037

 

6.76

 

Total interest-bearing liabilities

 

 

16,841,740

 

 

178,870

 

4.26

%

 

 

6,174,072

 

 

26,592

 

1.72

%

Total noninterest-bearing liabilities

 

 

786,175

 

 

 

 

 

 

682,474

 

 

 

 

Total liabilities

 

 

17,627,915

 

 

 

 

 

 

6,856,546

 

 

 

 

Total temporary equity

 

 

320,374

 

 

 

 

 

 

320,374

 

 

 

 

Total permanent equity

 

 

5,270,798

 

 

 

 

 

 

5,209,599

 

 

 

 

Total liabilities, temporary equity and permanent equity

 

$

23,219,087

 

 

 

 

 

$

12,386,519

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income

 

 

 

$

291,126

 

 

 

 

 

$

122,692

 

 

Net interest margin

 

 

 

 

 

5.74

%

 

 

 

 

 

5.23

%

Table 5

SoFi Technologies, Inc.

Condensed Consolidated Cash Flow Data

(Unaudited)

(In Thousands)

 

 

Six Months Ended June 30,

 

2023

 

2022

Net cash used in operating activities

 

$

(4,292,679

)

 

$

(1,956,723

)

Net cash used in investing activities

 

 

(307,826

)

 

 

(4,918

)

Net cash provided by financing activities

 

 

6,255,232

 

 

 

2,192,231

 

Effect of exchange rates on cash and cash equivalents

 

 

99

 

 

 

(94

)

Net increase in cash, cash equivalents, restricted cash and restricted cash equivalents

 

$

1,654,826

 

 

$

230,496

 

Cash, cash equivalents, restricted cash and restricted cash equivalents at beginning of period

 

 

1,846,302

 

 

 

768,437

 

Cash, cash equivalents, restricted cash and restricted cash equivalents at end of period

 

$

3,501,128

 

 

$

998,933

Table 6

Company Metrics
 

 

June 30,

2023

 

March 31,

2023

 

December 31,

2022

 

September 30,

2022

 

June 30,

2022

 

March 31,

2022

 

December 31,

2021

 

September 30,

2021

 

June 30,

2021

Members

 

6,240,091

 

5,655,711

 

5,222,533

 

4,742,673

 

4,318,705

 

3,868,334

 

3,460,298

 

2,937,379

 

2,560,492

Total Products

 

9,401,025

 

8,554,363

 

7,894,636

 

7,199,298

 

6,564,174

 

5,862,137

 

5,173,197

 

4,267,665

 

3,667,121

Total Products — Lending segment

 

1,503,892

 

1,416,122

 

1,340,597

 

1,280,493

 

1,202,027

 

1,138,566

 

1,078,952

 

1,030,882

 

981,440

Total Products — Financial Services segment

 

7,897,133

 

7,138,241

 

6,554,039

 

5,918,805

 

5,362,147

 

4,723,571

 

4,094,245

 

3,236,783

 

2,685,681

Total Accounts — Technology Platform segment(1)

 

129,356,203

 

126,326,916

 

130,704,351

 

124,332,810

 

116,570,038

 

109,687,014

 

99,660,657

 

88,811,022

 

78,902,156

___________________​​

(1)

 

Beginning in the fourth quarter of 2021, the Company included SoFi accounts on the Galileo platform-as-a-service in its total Technology Platform accounts metric to better align with the presentation of Technology Platform segment revenue. Quarterly amounts for the earlier quarters in 2021 were determined to be immaterial, and as such were not recast.

Members

We refer to our customers as “members”. We define a member as someone who has a lending relationship with us through origination and/or ongoing servicing, opened a financial services account, linked an external account to our platform, or signed up for our credit score monitoring service. Our members have continuous access to our certified financial planners, our career advice services, our member events, our content, educational material, news, and our tools and calculators, which are provided at no cost to the member. We view members as an indication not only of the size and a measurement of growth of our business, but also as a measure of the significant value of the data we have collected over time.

Once someone becomes a member, they are always considered a member unless they violate our terms of service. We adjust our total number of members in the event a member is removed in accordance with our terms of service. This could occur for a variety of reasons—including fraud or pursuant to certain legal processes—and, as our terms of service evolve together with our business practices, product offerings and applicable regulations, our grounds for removing members from our total member count could change. The determination that a member should be removed in accordance with our terms of service is subject to an evaluation process, following the completion, and based on the results, of which, relevant members and their associated products are removed from our total member count in the period in which such evaluation process concludes. However, depending on the length of the evaluation process, that removal may not take place in the same period in which the member was added to our member count or the same period in which the circumstances leading to their removal occurred. For this reason, our total member count may not yet reflect adjustments that may be made once ongoing evaluation processes, if any, conclude.

Total Products

Total products refers to the aggregate number of lending and financial services products that our members have selected on our platform since our inception through the reporting date, whether or not the members are still registered for such products. Total products is a primary indicator of the size and reach of our Lending and Financial Services segments. Management relies on total products metrics to understand the effectiveness of our member acquisition efforts and to gauge the propensity for members to use more than one product.

In our Lending segment, total products refers to the number of personal loans, student loans and home loans that have been originated through our platform through the reporting date, whether or not such loans have been paid off. If a member has multiple loan products of the same loan product type, such as two personal loans, that is counted as a single product. However, if a member has multiple loan products across loan product types, such as one personal loan and one home loan, that is counted as two products.

In our Financial Services segment, total products refers to the number of SoFi Money accounts (inclusive of checking and savings accounts held at SoFi Bank and cash management accounts), SoFi Invest accounts, SoFi Credit Card accounts (including accounts with a zero dollar balance at the reporting date), referred loans (which are originated by a third-party partner to which we provide pre-qualified borrower referrals), SoFi At Work accounts and SoFi Relay accounts (with either credit score monitoring enabled or external linked accounts) that have been opened through our platform through the reporting date. Checking and savings accounts are considered one account within our total products metric. Our SoFi Invest service is composed of three products: active investing accounts, robo-advisory accounts and digital assets accounts. Our members can select any one or combination of the three types of SoFi Invest products. If a member has multiple SoFi Invest products of the same account type, such as two active investing accounts, that is counted as a single product. However, if a member has multiple SoFi Invest products across account types, such as one active investing account and one robo-advisory account, those separate account types are considered separate products. In the event a member is removed in accordance with our terms of service, as discussed under “Members” above, the member’s associated products are also removed.

Technology Platform Total Accounts

In our Technology Platform segment, total accounts refers to the number of open accounts at Galileo as of the reporting date. Beginning in the fourth quarter of 2021, we included intercompany accounts on the Galileo platform-as-a-service in our total accounts metric to better align with the Technology Platform segment revenue, which includes intercompany revenue. We recast the accounts in the fourth quarter of 2021, but did not recast the accounts for the earlier quarters in 2021, as the impact was determined to be immaterial. Total accounts is a primary indicator of the accounts dependent upon our technology platform to use virtual card products, virtual wallets, make peer-to-peer and bank-to-bank transfers, receive early paychecks, separate savings from spending balances, make debit transactions and rely upon real-time authorizations, all of which result in revenues for the Technology Platform segment. We do not measure total accounts for the Technisys products and solutions, as the revenue model is not primarily dependent upon being a fully integrated, stand-ready service.

Table 7

Segment Financials

(Unaudited)

 

Quarter Ended

($ in thousands)

 

June 30,

2023

 

March 31,

2023

 

December 31,

2022

 

September 30,

2022

 

June 30,

2022

 

March 31,

2022

 

December 31,

2021

 

September 30,

2021

 

June 30,

2021

Lending

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income

 

$

231,885

 

 

$

201,047

 

 

$

183,607

 

 

$

139,516

 

 

$

114,003

 

 

$

94,354

 

 

$

77,246

 

 

$

72,257

 

 

$

56,822

 

Total noninterest income.

 

 

99,556

 

 

 

136,034

 

 

 

144,584

 

 

 

162,178

 

 

 

143,114

 

 

 

158,635

 

 

 

136,518

 

 

 

138,034

 

 

 

109,469

 

Total net revenue

 

 

331,441

 

 

 

337,081

 

 

 

328,191

 

 

 

301,694

 

 

 

257,117

 

 

 

252,989

 

 

 

213,764

 

 

 

210,291

 

 

 

166,291

 

Adjusted net revenue(1)

 

 

322,238

 

 

 

325,086

 

 

 

314,930

 

 

 

296,965

 

 

 

250,681

 

 

 

244,372

 

 

 

208,032

 

 

 

215,475

 

 

 

172,232

 

Contribution profit

 

 

183,309

 

 

 

209,898

 

 

 

208,799

 

 

 

180,562

 

 

 

141,991

 

 

 

132,651

 

 

 

105,065

 

 

 

117,668

 

 

 

89,188

 

Technology Platform

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income (expense)

 

$

 

 

$

 

 

$

 

 

$

 

 

$

 

 

$

 

 

$

 

 

$

39

 

 

$

(32

)

Total noninterest income

 

 

87,623

 

 

 

77,887

 

 

 

85,652

 

 

 

84,777

 

 

 

83,899

 

 

 

60,805

 

 

 

53,299

 

 

 

50,186

 

 

 

45,329

 

Total net revenue(2)

 

 

87,623

 

 

 

77,887

 

 

 

85,652

 

 

 

84,777

 

 

 

83,899

 

 

 

60,805

 

 

 

53,299

 

 

 

50,225

 

 

 

45,297

 

Contribution profit

 

 

17,154

 

 

 

14,857

 

 

 

16,881

 

 

 

19,536

 

 

 

21,841

 

 

 

18,255

 

 

 

20,008

 

 

 

15,741

 

 

 

13,013

 

Financial Services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income

 

$

74,637

 

 

$

58,037

 

 

$

45,609

 

 

$

28,158

 

 

$

12,925

 

 

$

5,882

 

 

$

1,785

 

 

$

1,209

 

 

$

542

 

Total noninterest income

 

 

23,415

 

 

 

23,064

 

 

 

19,208

 

 

 

20,795

 

 

 

17,438

 

 

 

17,661

 

 

 

20,171

 

 

 

11,411

 

 

 

16,497

 

Total net revenue

 

 

98,052

 

 

 

81,101

 

 

 

64,817

 

 

 

48,953

 

 

 

30,363

 

 

 

23,543

 

 

 

21,956

 

 

 

12,620

 

 

 

17,039

 

Contribution loss(2)

 

 

(4,347

)

 

 

(24,235

)

 

 

(43,588

)

 

 

(52,623

)

 

 

(53,700

)

 

 

(49,515

)

 

 

(35,189

)

 

 

(39,465

)

 

 

(24,745

)

Corporate/Other

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest expense

 

$

(15,396

)

 

$

(23,074

)

 

$

(20,632

)

 

$

(9,824

)

 

$

(4,199

)

 

$

(5,303

)

 

$

(2,454

)

 

$

(1,130

)

 

$

(1,320

)

Total noninterest income (loss).

 

 

(3,702

)

 

 

(837

)

 

 

(1,349

)

 

 

(1,615

)

 

 

(4,653

)

 

 

(1,690

)

 

 

(957

)

 

 

 

 

 

3,967

 

Total net revenue (loss)(2)

 

 

(19,098

)

 

 

(23,911

)

 

 

(21,981

)

 

 

(11,439

)

 

 

(8,852

)

 

 

(6,993

)

 

 

(3,411

)

 

 

(1,130

)

 

 

2,647

 

Consolidated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income

 

$

291,126

 

 

$

236,010

 

 

$

208,584

 

 

$

157,850

 

 

$

122,729

 

 

$

94,933

 

 

$

76,577

 

 

$

72,375

 

 

$

56,012

 

Total noninterest income.

 

 

206,892

 

 

 

236,148

 

 

 

248,095

 

 

 

266,135

 

 

 

239,798

 

 

 

235,411

 

 

 

209,031

 

 

 

199,631

 

 

 

175,262

 

Total net revenue

 

 

498,018

 

 

 

472,158

 

 

 

456,679

 

 

 

423,985

 

 

 

362,527

 

 

 

330,344

 

 

 

285,608

 

 

 

272,006

 

 

 

231,274

 

Adjusted net revenue(1)

 

 

488,815

 

 

 

460,163

 

 

 

443,418

 

 

 

419,256

 

 

 

356,091

 

 

 

321,727

 

 

 

279,876

 

 

 

277,190

 

 

 

237,215

 

Net loss

 

 

(47,549

)

 

 

(34,422

)

 

 

(40,006

)

 

 

(74,209

)

 

 

(95,835

)

 

 

(110,357

)

 

 

(111,012

)

 

 

(30,047

)

 

 

(165,314

)

Adjusted EBITDA(1)

 

 

76,819

 

 

 

75,689

 

 

 

70,060

 

 

 

44,298

 

 

 

20,304

 

 

 

8,684

 

 

 

4,593

 

 

 

10,256

 

 

 

11,240

 

___________________​​

(1)

 

​Adjusted net revenue and adjusted EBITDA are non-GAAP financial measures. For additional information on these measures and reconciliations to the most directly comparable GAAP measures, see “Non-GAAP Financial Measures” and Table 2 to the “Financial Tables” herein.

(2)

 

Technology Platform segment total net revenue includes intercompany fees. The equal and offsetting intercompany expenses are reflected within the Financial Services and Technology Platform segment directly attributable expenses. The intercompany revenues and expenses are eliminated in consolidation. The revenues are eliminated within Corporate/Other and the expenses represent a reconciling item of segment contribution profit (loss) to consolidated loss before income taxes. For the year ended December 31, 2021, all intercompany amounts were reflected in the fourth quarter, as inter-quarter amounts were determined to be immaterial.

SOFI-F

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