SOFI Financial Analysis

Analysis Date: 1/28/2025

Business Model

SoFi generates revenue through three main segments: Lending, Financial Services, and Technology Platform

Revenue Sources

• Lending: Personal loans, student loans, home loans - generates interest income and loan origination fees
• Financial Services: SoFi Money accounts, investing, credit cards - generates interchange, brokerage fees and referrals
• Technology Platform: Galileo and Technisys - generates technology service fees

Revenue Distribution by Channel

• Lending: 56% of Q4 2024 adjusted net revenue
• Financial Services: 35% of Q4 2024 adjusted net revenue
• Technology Platform: 14% of Q4 2024 adjusted net revenue

Income Statement Analysis

• Record quarterly revenue of $734.1M, up 19% year-over-year
• Adjusted EBITDA margin of 27%, showing strong profitability
• Fifth consecutive quarter of GAAP profitability

Balance Sheet Analysis

• Strong deposit growth to $26.0B, with over 90% from direct deposit members
• Total assets grew 20.5% year-over-year to $36.3B
• Tangible book value increased $1.37B year-over-year to $4.89B

Capital Allocation

SoFi continues to invest in growth while maintaining strong capital levels, with total capital ratio above 15%. The company is focused on scaling deposit growth and technology platform capabilities while maintaining disciplined credit standards.

Management Commentary

2024 was SoFi's best year ever with record revenue, profit, members and products

Financial Services and Tech Platform segments made up 49% of adjusted net revenue, up from 40% year ago

Achieved first full year of GAAP profitability

Overall Sentiment: Highly positive with strong execution across all business segments and achievement of key strategic objectives

Recommendation

Rating: Buy

Reason for Rating: Strong growth trajectory and improving profitability support positive outlook

Disclaimer: This analysis is based on company filings and public information. It is for informational purposes only and not financial advice. Past performance does not guarantee future results.

Generated on: 1/28/2025, 4:22:39 AM