SOFI Q3 Deep Dive: Product Expansion and Fee-Based Revenue Drive Member Growth

Digital financial services company SoFi Technologies (NASDAQ:SOFI) reported Q3 CY2025 results exceeding the market’s revenue expectations, with sales up 37.9% year on year to $961.6 million. On the other hand, the company’s full-year revenue guidance of $3.54 million at the midpoint came in 99.9% below analysts’ estimates. Its non-GAAP profit of $0.11 per share was 33.4% above analysts’ consensus estimates.

Is now the time to buy SOFI? Find out in our full research report (it’s free for active Edge members).

StockStory’s Take

SoFi’s third quarter results were met with a positive market reaction, as the company delivered revenue, adjusted earnings, and EBITDA that were above Wall Street expectations. Management attributed this performance to accelerating member acquisition, with CEO Anthony Noto highlighting that SoFi added a record 905,000 new members. The company’s one-stop-shop strategy, centered on broadening its financial services and technology platform offerings, drove both product adoption and engagement, with cross-buy rates reaching their highest level since 2022. Noto pointed to the deliberate diversification away from capital-intensive lending toward fee-based, capital-light revenue streams, which powered margin improvements and overall profitability.

Looking ahead, SoFi’s leadership believes continued investment in product innovation and market expansion will be key drivers of growth into next year. Noto emphasized the company’s plans to scale recently launched offerings like SoFi Pay and reintroduce cryptocurrency services, while leveraging its technology platform to secure new enterprise partnerships. Management also pointed to opportunities arising from macroeconomic trends, such as lower interest rates that could unlock greater demand for home and student loans. CFO Chris Lapointe stated, "We remain focused on growing our nonlending businesses and maintaining strong net interest margins, even as we invest in our product roadmap and member experience."

Key Insights from Management’s Remarks

SoFi’s management highlighted strong member growth, a pivot toward fee-based revenue, and new product launches as primary drivers of third quarter outperformance and margin strength.

• Member and product growth acceleration: SoFi achieved record new member and product additions, with cross-buy activity from existing members reaching a multi-year high, reflecting the effectiveness of its strategy to deepen customer relationships across its platform.
• Fee-based revenue expansion: The company saw a significant increase in fee-based revenue, driven by origination fees, referral fees, interchange, and brokerage services, resulting in over $1.6 billion annualized fee-based revenue. Management attributed this to broad diversification and a shift toward more capital-light business lines.
• Technology platform partnerships: New enterprise partnerships were secured, including with Southwest Airlines for a branded debit card, and two major consumer brands set to be announced. These deals underscore growing demand for SoFi’s embedded financial technology solutions.
• Launch of SoFi Pay and crypto relaunch: Management introduced SoFi Pay, an international blockchain-based payments product, and announced the upcoming relaunch of cryptocurrency trading within the SoFi app, aiming to differentiate SoFi’s digital money movement and investment experience.
• Operational discipline and capital raise: A successful $1.7 billion capital raise strengthened the balance sheet, allowing payoff of higher-cost debt and supporting continued investment in product development and marketing, without sacrificing profitability targets.

Drivers of Future Performance

SoFi’s management anticipates that expanding product capabilities, continued technology investment, and macroeconomic tailwinds will shape its outlook for next year.

• New product rollouts: Management expects the expansion of SoFi Pay, the relaunch of crypto trading, and the introduction of the SoFi Smart Card to drive both member acquisition and cross-sell opportunities, increasing engagement and recurring fee-based income.
• Diversification of revenue streams: The company is focused on growing its nonlending business lines, such as financial services and technology platform partnerships, to reduce reliance on balance sheet lending and improve overall margin stability, particularly as interest rates shift.
• Macroeconomic factors and credit quality: Leadership noted that falling interest rates could stimulate demand for student and home loan refinancing, while vigilant credit risk management and a disciplined investment approach are expected to protect margins and support sustainable growth.

Catalysts in Upcoming Quarters

In the coming quarters, the StockStory team will be monitoring (1) the pace and adoption of new products like SoFi Pay and the Smart Card, (2) further expansion of fee-based revenue streams through technology platform partnerships and crypto trading, and (3) the impact of changing interest rates on loan origination and refinancing demand. Execution on these fronts will be critical for sustaining SoFi’s member growth and profitability trajectory.

SoFi currently trades at $31.43, up from $30.06 just before the earnings. At this price, is it a buy or sell? See for yourself in our full research report (it’s free for active Edge members).

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