SoFi Technologies Inc
For the period ended Jun 30, 2024. Filed Aug 6, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2024 · Filed Aug 6, 2024
Extracted filing text, with the paragraph anchors used by the comparison.
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Financial Services Segment
In the table below, we present the total products metric related to our Financial Services segment:
| June 30, 2024 | June 30, 2023 | Change | % Change | |
|---|---|---|---|---|
| Total products | 10,989,850 | 7,897,133 | 3,092,717 | 39% |
Total products in our Financial Services segment is a subset of our total products metric. See “Key Business Metrics” for a further discussion of this measure as it relates to our Financial Services segment.
Financial Services Segment Results of Operations
The following table presents the measure of contribution profit (loss) for the Financial Services segment:
| Three Months EndedJune 30, · 2024 vs 2023 · Six Months EndedJune 30, · 2024 vs 2023 | ||||||||
|---|---|---|---|---|---|---|---|---|
| ($ in thousands) | 2024 | 2023 | $ Change | % Change | 2024 | 2023 | $ Change | % Change |
| Net interest income | $139,229 | $74,637 | $64,592 | 87% | $258,942 | $132,674 | $126,268 | 95% |
| Noninterest income | 36,903 | 23,415 | 13,488 | 58% | 67,741 | 46,479 | 21,262 | 46% |
| Total net revenue | 176,132 | 98,052 | 78,080 | 80% | 326,683 | 179,153 | 147,530 | 82% |
| Directly attributable expenses | (120,912) | (102,399) | (18,513) | 18% | (234,289) | (207,735) | (26,554) | 13% |
| Contribution profit (loss) | $55,220 | $(4,347) | $59,567 | n/m | $92,394 | $(28,582) | $120,976 | n/m |
Net interest income in our Financial Services segment increased by $64.6 million, or 87%, and $126.3 million, or 95%, for the three and six months ended June 30, 2024, respectively, compared to the same periods in 2023, which was primarily attributable to net interest income earned on our deposits, which includes interest income based on our FTP framework (which eliminates in consolidation) and interest expense to members. This net increase corresponds with the growth of deposits at SoFi Bank, as well as the impact of higher interest rates offered to members.
Noninterest income in our Financial Services segment increased by $13.5 million, or 58%, and $21.3 million, or 46%, for the three and six months ended June 30, 2024, respectively, compared to the same periods in 2023, primarily due to an increase in interchange fees, which coincided with increased credit card and debit card transactions, as well as growth in referral fulfillment activity, as we continue to drive volume to our partners.
The directly attributable expenses allocated to the Financial Services segment that were used in the determination of the segment's contribution profit (loss) were as follows:
| Three Months EndedJune 30, · 2024 vs 2023 · Six Months EndedJune 30, · 2024 vs 2023 | ||||||||
|---|---|---|---|---|---|---|---|---|
| ($ in thousands) | 2024 | 2023 | $ Change | % Change | 2024 | 2023 | $ Change | % Change |
| Compensation and benefits | $32,309 | $30,692 | $1,617 | 5% | $64,814 | $61,167 | $3,647 | 6% |
| Member incentives | 22,285 | 11,862 | 10,423 | 88% | 41,669 | 23,317 | 18,352 | 79% |
| Product fulfillment | 17,221 | 11,261 | 5,960 | 53% | 33,797 | 21,870 | 11,927 | 55% |
| Provision for credit losses | 11,634 | 12,615 | (981) | (8)% | 18,799 | 21,022 | (2,223) | (11)% |
| Direct advertising | 6,190 | 15,566 | (9,376) | (60)% | 15,187 | 28,641 | (13,454) | (47)% |
| Lead generation | 7,452 | 6,427 | 1,025 | 16% | 13,871 | 23,480 | (9,609) | (41)% |
| Intercompany technology platform expenses | 5,533 | 2,641 | 2,892 | 110% | 10,484 | 4,738 | 5,746 | 121% |
| Professional services | 4,489 | 2,533 | 1,956 | 77% | 9,266 | 4,140 | 5,126 | 124% |
| Other(1) | 13,799 | 8,802 | 4,997 | 57% | 26,402 | 19,360 | 7,042 | 36% |
| Directly attributable expenses | $120,912 | $102,399 | $18,513 | 18% | $234,289 | $207,735 | $26,554 | 13% |
(1)Other expenses primarily include operational product losses, third-party fraud expense, network servicing fees, travel and occupancy-related costs, tools and subscriptions, and marketing expenses.
Financial Services directly attributable expenses increased by $18.5 million, or 18%, and $26.6 million, or 13%, for the three and six months ended June 30, 2024, respectively, compared to the same periods in 2023, primarily due to: (i) an increase in direct member incentives utilized to drive adoption and usage of our Financial Services products, the most significant of which was our SoFi Money product, (ii) an increase in product fulfillment costs, which included debit card fulfillment services, primarily related to our SoFi Money product, (iii) an increase in intercompany expenses attributable to increased usage of technology platform services during the 2024 period, as well as (iv) net decreases in direct advertising and lead generation costs driven by efficient partnerships as we continue to drive expansion of our SoFi Money product.
The text of this filing, as the company filed it with the SEC, without its images or exhibits. This is not investment advice.