SoFi is a one-stop shop for financial services. It aims to provide consumers with excellent products for all major needs and events. It wants to delight them so much that they never go anywhere else. That creates key cross-selling and acquisition cost benefits. It has a large lending business with an increasingly diverse array of funding options, as well as bank accounts, brokerage services, 3rd-party insurance options, credit cards and so much more. It also owns its tech stack, has no branches and possesses a bank charter, which all give it the rare ability to combine the cost edges that incumbents and fintechs each enjoy. It also sells its tech stack to customers like H&R Block and Robinhood. My SoFi deep dive can be found here. This goes into intricate detail on SoFi’s unique value proposition within banking and everything else you need to know about the firm.

Overall revenue beat estimates by 8.4%. Financial services revenue beat estimates by 4%. Revenue per financial services product actually fell Y/Y from $104 to $90, but that was related to SoFi now counting SoFi Invest as six products instead of two. I’ve seen this floating around financial media as a red flag, but it isn’t one. It’s just a reshuffling of product disclosures as SoFi Invest scales. Lending revenue beat by 13.5%. Technology platform revenue missed estimates by 0.7%. SoFi now has 8 businesses generating $100M+ in annualized revenue.

The company also beat member estimates by 1.1%, representing net new member growth that was 17% (or 180K) ahead of estimates. It beat product growth estimates by 2% with net new products coming in 28% ahead of estimates. It’s great to see Q/Q product growth again meaningfully outpacing superb member growth. That’s happening despite rapid member growth and is a byproduct of SoFi’s cross-selling momentum getting even better.

As we work through this section, recall that net charge-off is a lagging credit indicator, while delinquency rates are more of a leading indicator. Unlike most peers, SoFi doesn’t use current expected credit loss (CECL) accounting. They enlist an independent 3rd party auditor, highly conservative macro assumptions and overly harsh delinquent loan write-down standards to set fair value markings on loan pools every quarter. To avoid pent-up unrealized losses, markings and changes in fair value flow through the income statement every single quarter. It hedges away the interest rate-driven portion of these fair value changes, which removes any incentive to prop up its marks. This approach gives SoFi more flexibility to buy and sell loans while following strict GAAP rules. 

In this piece, we’ll provide detailed SoFi credit data that’s rich with tangible evidence that, if anything, their fair value markings are overly prudent. Let’s dig in.

We don’t really need to spend a ton of time here. Everything is boring… in the absolute best of ways. No big changes. No unexpected deteriorations. No added risk-taking. Just more credit resilience within their enviable ultra-prime niche. Thankfully more of the same. Leading and lagging indicators for all 3 loan types are either stable or improving. Regardless of which metric you pick and whether or not you back out their routine delinquent loan sales, things look great and well within their 7%-8% life-of-loan loss tolerance. 

From a loan cohort point of view, for yet another quarter, the cushion between current loss rates and the loss rates seen last time they approached 8% losses (2017) widened. For vintages from Q4-2022 to today, the lead grew by another 19 basis points, after widening by 15 basis points last quarter. Views of different vintages tell a similar story; everything here is in great shape.

Capital Market Activity – LPB & Loan Sales:

SoFi moved $5.3B in loan volume through LPB and loan sales, representing 15% Y/Y and 29% Q/Q growth, as SoFi leans on this channel more now that its capital ratio cushion is closer to desired levels. It also sold $1.4B in home loans at a healthy 103.6% gain on sale margin. Encouragingly, it executed a securitization deal for $460M in previously originated LPB loans at an 83 basis point spread. That beat last quarter’s 91 and 86 basis point deals, which SoFi already called industry-leading (lower is better), and shows secondary markets for these loans are increasingly healthy. That should give partners incremental confidence (not that they needed it) in signing larger agreements with SoFi.

Deposits & Liquidity:

The guidance raise reflects “both the third quarter beat and higher expectations for the fourth quarter of 2026.” Q4 guidance assumes $785M in lending revenue (61% growth), $90M in tech revenue (a 26.5% Y/Y decline due to Chime churn) and $550M in financial services revenue (20% growth).

SoFi raised annual revenue guidance by 5%, which beat estimates by 3.3%. This means their implied Q4 revenue guidance is 4.2% ahead of estimates. The company also reiterated 30%+ member growth for 2026, which is pretty much a slam dunk at this point. It raised annual EBITDA guidance by 3.8%, which beat estimates by 2.5%. This means their implied Q4 EBITDA guidance is 1.7% ahead of estimates. Finally, it raised its $0.60 annual EPS guidance by $0.01 to $0.61, beating estimates by $0.02.

The team also surprised us with early 2027 guidance. They said this was in response to improving demand visibility and business model resilience regardless of the fed funds rate path. SoFi loves to set targets that they can comfortably beat. Noto and Lapointe are Wall Street veterans. They know how to play the beat and raise game and they’re happy to do it. For this reason, they are most conservative when setting new annual guidance that requires modeling up to 15 months in advance. That’s especially true with the rate path and overall macro backdrop more chaotic than it usually is. That’s why I found the $0.90 EPS guide highly encouraging. I’m confident that they set this level to be comfortably surpassed… and it’s already nearly 10% better than analysts were expecting. There will inevitably be large positive estimate revisions following this report. Analysts currently expect 39% 2027 EPS growth and 31% 2028 EPS growth… but again both should move materially higher following this stellar report.

I think the most important part of this quarter’s guidance pertains to the balance sheet. SoFi committed to funding its growth plan with existing capital ratio cushions and ramping profits. No capital raises in 2027. Beyond that, organic profit growth should provide the cash needed to pay for their growth plans, further limiting the need to raise more capital. They didn’t outright say “no raises in 2028 either,” but they did say “2027 and beyond.” Loved hearing this.

At $15/share, SoFi trades for 17x forward EPS, with EPS guided to grow 48% Y/Y in 2027. 2028 consensus EPS expectations imply 20% growth estimates vs. SoFi’s 2027 guidance, but those estimates will be revised higher after this report.