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SOFI Stock: 3 Key Takeaways From SoFi’s Q1 Earnings Report

Today, SoFi Technologies (NASDAQ:SOFI) is in the spotlight after accidentally releasing its first-quarter earnings report early. The company attributed the accidental release to “human error.” Shares of SOFI stock were halted at 11:19 a.m. and traded down 18% at the time. Trading then resumed just after 2:00 p.m. Currently, shares are down about 9%.

SoFi billboard seen at night.
Source: Tada Images / Shutterstock.com

For the period, SoFi reported revenue of $322 million, up 49% year-over-year (YOY) and beating analyst estimates of $286.4 million. Meanwhile, the personal finance company also reported an earnings per share (EPS) loss of 14 cents, which was in line with analyst expectations on Yahoo! Finance. On top of that, EBITDA (earnings before interest, taxes, deductions and amortization) came in at $9 million, marking a positive EBITDA figure for the seventh-straight quarter.

Here’s what investors should know about SOFI stock moving forward.

SOFI Stock: SoFi Beats on Revenue, Is In-Line with EPS

As far as its Q1 results go, the revenue beat is a huge deal for SoFi. Investors had speculated that President Joe Biden’s August extension of the federal student loan payment moratorium would hurt the company. For the period, Q1 student loan volume of $984 million was “essentially flat” compared to Q1 2021. However, student loan volume was higher during Q4 at $1.5 billion. The earnings report also noted “President Biden may soon introduce some form of student loan forgiveness.”

CEO Anthony Noto commented the following on the results:

“Because of the depth and breadth of our offerings, we were able to make swift and critical adjustments in priorities and spend as conditions evolved quickly, to capitalize on growth opportunities and exceed our performance targets. Strength across all three of our business segments — Lending, Technology Platform and Financial Services.”

In addition to this, Noto also believes the company’s bank charter is off to a great start. As of March 31, the company had $1.2 billion in deposits. These deposits “accelerated since [SoFi] raised the maximum APY to 1.25% in April.”

Finally, it’s important to note that first-quarter revenue exceeded the company’s guidance of $280 million to $285 million by 13% at the high end. Q1 EBITDA also exceeded guidance of $0 to $5 million by 74% at the high end. That’s a big deal.

SoFi Raises Guidance for 2022

For Q2, SoFi Technologies guided for $330 million to $340 million of revenue. That implies YOY growth of 43% on the high end. However, analysts are expecting revenue of around $342 million for Q2.

Meanwhile, for the full year, SoFi also raised its 2022 revenue guidance to between $1.505 billion to $1.51 billion. Previously, the company had guided for 2022 revenue of $1.47 billion. This guidance “assumes that the student loan moratorium will not in fact end during the course of 2022.”

On the date of publication, Eddie Pan did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Eddie Pan specializes in institutional investments and insider activity. He writes for InvestorPlace’s Today’s Market team, which centers on the latest news involving popular stocks.


Article printed from InvestorPlace Media, https://investorplace.com/2022/05/sofi-stock-3-key-takeaways-from-sofis-q1-earnings-report/.

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