SoFi Technologies Inc

Lending Segment Results of Operations

The following table presents the measure of contribution profit for the Lending segment:

(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, which are recorded within noninterest income in the condensed consolidated statements of operations and comprehensive income, are unrealized during the period and, therefore, have no impact on our cash flows from operations.

(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, with fair value changes recorded within noninterest income in the condensed consolidated statements of operations and comprehensive income, 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.

(3)Other expenses primarily include loan marketing expenses, member promotional expenses, tools and subscriptions, travel and occupancy-related costs and third-party loan fraud (net of related insurance recoveries).

(4)Adjusted net revenue is a non-GAAP financial measure. For information regarding our use and definition of this measure and for a reconciliation to the most directly comparable U.S. GAAP measure, total net revenue, see “Non-GAAP Financial Measures” herein.

Net interest income in our Lending segment increased by $94.1 million, or 35%, for the three months ended March 31, 2025 compared to the same period in 2024. This was primarily attributable to increases in aggregate average personal and student loan unpaid principal balances of $2.5 billion (17%) and $1.9 billion (29%), respectively, combined with higher weighted average interest rates on student loans. The personal and student loan average balance increases were primarily attributable to higher origination volume and longer loan holding periods.

Noninterest income in our Lending segment decreased by $11.2 million, or 17%, for the three months ended March 31, 2025 compared to the same period in 2024, which was primarily attributable to lower loan origination, sales, and securitizations income of $8.6 million.

Loan Origination, Sales, and Securitizations

The following table presents the components of noninterest income—loan origination, sales, and securitizations:

(1)Includes fair value adjustments on loans originated during the period, fair value adjustments of loans and securitization bond and residual interest positions held at the balance sheet date, as well as gains (losses) on loans sold and consolidated securitization transactions during the period. Fair value adjustments are impacted by interest rates, weighted average coupon, credit spreads and loss estimates, prepayment speeds, duration and previous loan sale execution on similar loans.

(2)Includes gains (losses) on IRLCs and interest rate caps.

(3)For the three months ended March 31, 2025 and 2024, includes gross write-offs of $186.8 million and $175.5 million, respectively. Total recoveries were $26.1 million and $30.8 million, respectively, of which $19.4 million and $25.0 million, respectively, were captured via loan sales to a third-party collection agency.

(4)Represents the (expense) benefit associated with our estimated loan repurchase obligation. See Note 14. Commitments, Guarantees, Concentrations and Contingencies to the Notes to Condensed Consolidated Financial Statements for additional information.

The decrease in loan origination, sales, and securitizations income of $8.6 million, or 15%, was primarily driven by: (i) a net decrease of $33.1 million related to the following: losses during the 2025 period compared to gains in the 2024 period on student loan, personal loan and risk retention interest rate swap positions, primarily driven by larger increases in interest rates in the 2024 period ($340.2 million), partially offset by higher fair value gains on personal loans in the 2025 period compared to losses during the 2024 period, which were primarily impacted by larger decreases in discount rate assumptions during 2025 ($191.7 million); as well as higher fair value gains on student loans, which were primarily impacted by lower discount rate assumptions ($115.3 million); (ii) higher personal and student loan write-offs in the 2025 period, primarily driven by higher loan origination volume and longer loan holding periods ($15.9 million); and (iii) higher losses of $4.1 million on personal loan sales in the 2025 period, which were due to both price and volume factors, as well as higher delinquent loan sales in the 2025 period.

These decreases were partially offset by higher origination fees ($28.3 million) primarily related to a product feature offered on personal loans, whereby a borrower may optionally elect to pay origination fees to qualify for a lower annual percentage rate.

Servicing

We own the master servicing on all of the servicing rights that we retain and, in each case, recognize the gross servicing rate applicable to each serviced loan. Sub-servicers are utilized for all serviced student loans and home loans, which represents a cost to SoFi, but these arrangements do not impact our calculation of the weighted average basis points earned for each loan type serviced. Further, there is no impact on servicing income due to forbearance and moratoriums on certain debt collection activities, and there are no waivers of late fees.

The table below presents information related to our loan servicing assets:

Lending segment directly attributable expenses for the three months ended March 31, 2025 increased by $55.8 million, or 47%, compared to the same period in 2024, primarily due to: (i) an increase in direct advertising primarily related to online and digital advertising, (ii) an increase in expense related to personal and student loan lead generation channels, (iii) an increase in loan origination and servicing costs which corresponds with increased loan origination volume, and (iv) an increase in allocated compensation and related benefits, which reflected an increase in headcount in 2025 to support growth in the Lending segment.

Total products in our Lending segment is a subset of our total products metric. See “Key Business Metrics” and “Business Overview” for further discussion of this measure as it relates to our Lending segment.

In the table below, we present certain metrics and financial information related to our Lending segment:

(1)Inclusive of origination volume related to our Loan Platform Business. For the three months ended March 31, 2025, we originated $1.6 billion of personal loans on behalf of third parties. We did not originate any loans on behalf of third parties during the three months ended March 31, 2024.

(2)Loans with a balance and average loan balance include Lending products on our balance sheet, as well as transferred loans and referred loans with which we have a continuing involvement through our servicing agreements.

(3)Includes in-school loans and student loan refinancing products. In-school loans carry a lower average balance than student loan refinancing products.

Origination Volume

We refer to the aggregate dollar amount of loans originated through our platform in a given period as origination volume. Origination volume is an indicator of the size and health of our Lending segment and an indicator (together with the relevant loan characteristics, such as interest rate and prepayment and default expectations) of revenues and profitability. We also originate and sell loans in support of our Loan Platform Business, through which we provide lending related services to third-party partners. We maintain the same lending relationship with borrowers across all loans that we originate, inclusive of those originated on behalf of a third-party partner and as such, reflect these products within our Lending segment total products. Changes in origination volume are driven by the addition of new members and existing members, the latter of which at times will either refinance into a new SoFi loan or secure an additional, concurrent loan, as well as macroeconomic factors impacting consumer spending and borrowing behavior.

Personal Loans. During the three months ended March 31, 2025, total personal loan origination volume increased by 69% relative to the corresponding 2024 period, inclusive of a $1.6 billion increase related to personal loans originated on behalf of third parties in support of our Loan Platform Business which we expanded starting in the second half of 2024. Overall increases in origination volume were primarily due to increased demand for debt consolidation products in an elevated interest rate environment, as well as increased demand driven by expanded advertising and marketing efforts.

Student Loans. During the three months ended March 31, 2025, student loan origination volume increased by 59% relative to the corresponding 2024 period, as demand for student loan refinancing products increased after the resumption of principal and interest payments in 2024 on federally-held student loans as borrowers looked to refinance at a lower rate, as well as increased interest in loan term extensions given the elevated interest rate environment.

Home Loans. During the three months ended March 31, 2025, home loan origination volume increased by 54% relative to the corresponding 2024 period. Our home loan origination volume increased notably throughout 2024 and into 2025, aided by the increased capacity and technology and fulfillment capabilities subsequent to our acquisition of Wyndham. Origination volume in the first quarter of 2025 also reflected demand for home equity loans in the elevated interest rate environment. We began offering fixed rate home equity loans and variable rate HELOCs during 2024.

Loans with a Balance and Average Loan Balance

Loans with a balance refers to the number of loans that have a balance greater than zero dollars as of the reporting date. Loans with a balance allows management and investors to better understand the unit economics of acquiring a loan in relation to the lifetime value of that loan. Average loan balance is defined as the total unpaid principal balance of the loans divided by loans with a balance within the respective loan product category as of the reporting date. Average loan balance tends to fluctuate based on the pace of loan originations relative to loan repayments and the initial loan origination size.

In the table below, we present additional information related to our lending products:

(1)Inclusive of activity related to loans originated and subsequently sold as part of our Loan Platform Business. For the three months ended March 31, 2025, included $1.6 billion related to loans originated on behalf of third parties. We did not originate any loans on behalf of third parties during the three months ended March 31, 2024.

(2)Weighted average interest rate earned represents annualized interest income recognized divided by the average of the unpaid principal balances of loans outstanding during the period, which are impacted by loan holding periods as well as interest rates charged to borrowers. Weighted average interest rate earned was determined on a daily basis.

Transfers of Financial Assets

We regularly transfer financial assets and account for such transfers as either sales or secured borrowings depending on the facts and circumstances of the transfer. See Note 3. Loans to the Notes to Condensed Consolidated Financial Statements for additional information.

The following table summarizes our current whole loan sales:

(1)Sale execution represents the ratio of cash proceeds and servicing assets recognized to the aggregate unpaid principal balance and accrued interest of the loans sold. Amounts included in repurchase liabilities are excluded from the calculation, as they typically would not materially differ from the fair value markdown on the loans over the repurchase period had they been held on balance sheet and entered delinquency.

(2)Excludes net origination fees, which are recognized in earnings at the time of origination. Personal loans sold during the three months ended March 31, 2025 and 2024 had related origination fees of $30,338 and $11,052, respectively. Sales execution, for the respective periods, including these origination fees would be 108.9% and 108.8%.

The following table summarizes our delinquent whole loan sales:

(1)During the three months ended March 31, 2025 and 2024, includes $90.0 million and $62.5 million, respectively, of aggregate unpaid principal balance sold, related to late-stage delinquent loans for which we retained servicing and portions of recoveries. For the three months ended March 31, 2025 and 2024, $63.3 million and $43.2 million, respectively, of unpaid principal balance was recorded in prior periods as a write down innoninterest income—loan origination, sales, and securitizations in the condensed consolidated statements of operations and comprehensive income. These loans were sold prior to charge-off during the three months ended March 31, 2025 and 2024, respectively, and otherwise would have been charged off as of March 31, 2025 and 2024, respectively, consistent with our policy. In our other charged off whole loan sales, we typically do not retain servicing or recoveries.

(2)Sale execution represents the ratio of cash proceeds and servicing assets recognized to the aggregate unpaid principal balance and accrued interest of the loans sold. Amounts included in repurchase liabilities are excluded from the calculation, as they typically would not materially differ from the fair value markdown on the loans over the repurchase period had they been held on balance sheet and entered delinquency.