Morningstar

SoFi Earnings: NIM Expansion and Loan Platform Business Drive Revenue Growth

If conditions deteriorate due to tariffs, we expect demand for SoFi’s loans to drop.

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Securities in This Article
SoFi Technologies Inc Ordinary Shares
(SOFI)

Key Morningstar Metrics for SoFi Technologies

What We Thought of SoFi Technologies’ Earnings

SoFi Technologies SOFI reported strong first-quarter earnings, as the company benefited from strong demand for its loans from both borrowers and investors. Adjusted net revenue increased 32.7% year over year to $770.7 million, while adjusted EPS rose to $0.06 from $0.02 last year.

Why it matters: SoFi’s loan platform business was a major source of growth, with revenue increasing to $96.1 million from $10.7 million last year. Our concerns that this business would be a growth headwind in 2025 once the initial $2 billion deal with Fortress ended have not been borne out.

  • Demand for loans through SoFi’s sales channel has been stronger than expected, with the firm signing a total of $8 billion in new commitments in 2025.
  • This demand has allowed SoFi to take full advantage of its origination potential, with total loan origination increasing 66% year over year to $7.2 billion, inclusive of the $1.6 billion originated through the loan platform segment.

The bottom line: We maintain our $14 per share fair value estimate for no-moat SoFi. We see the shares as fairly valued at current prices. We also note that the firm is exposed to macroeconomic uncertainty. Our Uncertainty Rating is Very High.

  • SoFi’s loan origination capabilities are larger than its balance sheet can support. However, the firm is still able to monetize the strength of its sales channel by either selling loans it makes in the secondary market or signing third-party origination deals in its loan platform business.
  • If economic conditions deteriorate due to tariff-related uncertainty, we expect demand for SoFi’s loans to drop, reducing both volume and pricing in this part of its business.

Key stats: Thanks to the strong quarter, SoFi increased its 2025 GAAP EPS guidance. The firm now expects to earn $0.27-$0.28 per share, up from its initial guidance of $0.25-$0.27.

  • This is still a bit below our own projection for $0.32 in 2025, but we note that SoFi has a history of issuing conservative guidance.

Editor’s Note: This analysis was originally published as a stock note by Morningstar Equity Research.

The author or authors do not own shares in any securities mentioned in this article. Find out about Morningstar’s editorial policies.

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