To The Moon

$SoFi Technologies Inc.(SOFI)$ is scheduled to release its Q1 2025 earnings report before the market opens on Tuesday (29 April 2025).

Revenue: Expected to be around $739 million to $742 million. This represents significant year-over-year growth of approximately 27-28%. (Note: SoFi's own guidance for Q1 was slightly different at $725M-$745M adjusted net revenue).

Earnings Per Share (EPS): The consensus estimate is for $0.03 per share. This would be a 50% increase from the $0.02 reported in Q1 2024, indicating continued progress towards sustained profitability. Some analysts predict a potential beat, possibly reaching $0.04-$0.05.

GAAP Profitability: Following its first GAAP profitable quarter in Q4 2024, SoFi is expected to maintain profitability in Q1 2025.

SoFi Technologies (SOFI) Last Positive Earnings Call Saw Share Price Decline By 28.13%

SOFI had a positive earnings call which saw its share price declined by 28.13% since.

The earnings call for SoFi Technologies reflects a strong performance in 2024, marked by record member growth, significant revenue increases, and achieving first-time GAAP profitability. The company's strategic focus on fee-based revenue and expansion of services like SoFi Plus demonstrate a positive trajectory. However, challenges remain in the Tech Platform segment with slower growth than anticipated. The introduction of a higher tax rate is also noted. Overall, the positive achievements outweigh the lowlights, signaling a promising outlook for 2025.

SoFi Technologies (SOFI) Guidance

In the SoFi Technologies Q4 and Full Year 2024 earnings call, the company provided robust guidance for 2025, highlighting expected growth and profitability. SoFi projects adding at least 2.8 million new members, a 28% year-over-year increase, and anticipates adjusted net revenue between $3.20 billion and $3.275 billion, representing a 23% to 26% growth. Adjusted EBITDA is forecasted at $845 million to $865 million, with an incremental EBITDA margin of 30%. The company also expects adjusted GAAP net income between $285 million and $305 million, translating to an EPS of $0.25 to $0.27.

SoFi plans to continue investing in its Financial Services and Technology Platform segments, with a particular focus on scaling the Invest business and expanding its SoFi Plus subscription offering. The company remains confident in exceeding its medium-term guidance of 20% to 25% compounded annual revenue growth through 2026, supported by a strong business environment and strategic investments in innovation and brand building.

Key Areas of Focus For SoFi Technologies (SOFI) Q1 2025 Earnings

SoFi reached over 10 million members, growing 34% year-over-year and 10x over the past five years, with 785,000 new members added in Q4 alone.

Segment Performance

Adjusted net revenue was $2.6 billion in 2024, up 26% year-over-year. The Financial Services and Technology Platform segments generated $1.2 billion, up 54% year-over-year.

2024 marked SoFi's first full year of GAAP profitability, with net income of $499 million and adjusted EBITDA of over $665 million, achieving a 26% EBITDA margin.

Financial Services: This segment is expected to be the primary growth driver, with revenue potentially growing around 95% year-over-year (consensus estimate ~$294M). Key metrics include member growth (SoFi guided for at least 2.8 million new members in 2025), new product adoption, and increasing revenue per product.

Lending: Moderate growth is expected here (consensus estimate ~$372M, ~12.6% YoY growth). While personal loan originations have been strong, potential headwinds from the interest rate environment or tariff impacts on consumer affordability could temper growth.

Technology Platform (Galileo/Technisys): Modest growth is anticipated (around 3% YoY). Analysts will look for signs of new client wins and contribution to revenue diversification.

The Tech Platform segment experienced slower than expected growth, leading to revised expectations of mid-teens CAGR from 2023 to 2026.

Deposits: Continued strong deposit growth (reaching $26 billion previously) is crucial as it provides a low-cost funding source for SoFi's lending activities.

Shift to Fee-Based Income: Progress on SoFi's strategy to become more capital-light, particularly through its loan platform partnerships (like the $5B Blue Owl agreement or deals with Fortress), will be watched closely. Growth in fee income helps reduce credit risk.

Total fee-based revenue was $970 million, up 74% from the prior year, driven by origination fees, loan platform business, referrals, interchange, and brokerage.

SoFi announced a new fee-based subscription option for SoFi Plus, providing over $1,000 of value annually for a low monthly fee or through direct deposit.

Forward Guidance: Management's outlook for Q2 and the full year 2025 will be heavily scrutinized. SoFi previously guided for 23-26% revenue growth and $0.25-$0.27 EPS for the full year 2025 – investors will look for confirmation or adjustments to this forecast.

Context and Sentiment

SoFi expects a normalized effective tax rate of approximately 26%, impacting future net income compared to minimal tax impact in previous periods.

Stock Performance: SOFI stock has declined significantly year-to-date (down ~20-29%), despite reporting strong growth previously. This puts pressure on the company to deliver strong results and positive guidance.

Valuation: Some analysts view the stock as overvalued based on current metrics (like Price-to-Earnings or Price-to-Sales ratios), meaning the company needs to convincingly demonstrate strong future growth potential.

Analyst Opinions: Wall Street ratings are mixed, leaning towards a 'Hold' consensus, although some analysts maintain bullish 'Buy' ratings, citing long-term potential in its diversified model and growing member base.

SoFi Technologies Price Target

Based on 17 Wall Street analysts offering 12 month price targets for SoFi Technologies in the last 3 months. The average price target is $13.69 with a high forecast of $20.00 and a low forecast of $6.00. The average price target represents a 6.29% change from the last price of $12.88.

Technical Analysis - Exponential Moving Average (EMA)

SoFi was up 4.63% on Friday, this is another good day for the company, which has bring it on the context of a daily uptrend. The higher lows are being looked at around 10.30 to 10.60 within this whole region.

So if there is any move lower, then we could be looking for a higher low for possible further daily uptrend continuation. So we only have Monday before we have SoFi earnings which is on next Tuesday.

We need to be aware of the area of resistance which is around $14 up to roughly $16 the top end of that range. That could also be the lower end of the range back in the bull market of 2021.

RSI is gaining momentum so I might want to continue to look at SoFi to sell some when it hit around $15.

Summary

Analysts expect SoFi to report another quarter of strong year-over-year revenue growth and continued GAAP profitability. The spotlight will be on the Financial Services segment's performance, member growth, the health of the lending business amidst economic factors, and, crucially, the company's forward-looking guidance for the rest of 2025. Given the recent stock underperformance and mixed analyst sentiment, meeting or exceeding expectations, especially on guidance, will be important for the stock's reaction.

Appreciate if you could share your thoughts in the comment section whether you think SOFI would give another strong quarter with continued GAAP profitability, I am a long-term investor on SOFI and I am holding this fintech stock for long-term potential growth.

@TigerStars @Daily_Discussion @Tiger_Earnings @TigerWire appreciate if you could feature this article so that fellow tiger would benefit from my investing and trading thoughts.

Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.