SoFi Technologies (SOFI) is gearing up to release its first quarter financial results on Tuesday, April 29. The financial technology company’s stock has taken a hit, down about 22% since the start of the year. The decline has primarily been driven by investor concerns over a potential economic slowdown, which has weighed on many growth-focused names in the fintech space.
Despite the macroeconomic uncertainty, SoFi has consistently delivered solid growth. Over the past several quarters, the company has expanded its members and product base, signaling underlying strength and solid execution. Furthermore, its focus on revenue diversification and access to low-cost capital bode well for growth.
SoFi to Deliver Solid Growth in Q1
The Street sees continued momentum in SoFi’s financials, with analysts expecting it to report earnings of $0.03 per share, reflecting a 50% increase year-over-year. This projection follows a pattern of consistent outperformance. For instance, SoFi has beaten earnings expectations for four consecutive quarters, most recently surpassing Q4 2024 estimates by a solid 25%.
The company is guiding for adjusted net revenue in the range of $725 million to $745 million for Q1, a notable 25% to 28% year-over-year jump from the $581 million reported in the first quarter of 2024. This growth will be driven by increased loan platform fees, with the company seeing a surge in personal loan volume. In fact, 2024 was a record year for SoFi’s Loan Platform Business, which originated and transferred $2.1 billion in personal loans.
Beyond personal loans, increased originations in student and home loans are also expected to lift the company’s top-line results. At the same time, SoFi’s Tech Platform continues to gain traction, underpinned by several new strategic partnerships. This segment benefits from recurring revenue streams and larger average deal sizes, especially from well-established brands, offering stability to the company’s overall performance.
SoFi’s Growth Engine Is Just Getting Started
SoFi Technologies is likely to deliver solid growth in 2025 and beyond. The company is forecasting a robust expansion in its member base — at least 2.8 million new users this year alone, representing a 28% jump compared to 2024. This surge will drive engagement across SoFi’s suite of products and services, setting the stage for higher adoption rates and stronger revenue.
SoFi’s management maintains confidence in its ability to outperform its medium-term growth targets. The company is aiming for annual revenue growth of 20% to 25% through 2026. Further, SoFi is targeting earnings per share (EPS) of between $0.55 and $0.80 by that year, with plans to maintain annual EPS growth of 20% to 25% beyond that point.
Central to this growth is SoFi’s strategy to diversify its revenue streams. By pivoting toward capital-light, fee-based income, the company has strengthened its financial resilience and reduced exposure to credit risk.
Fee-based income has become a driving force, surging 74% to reach $970 million in 2024. This growth stems from higher origination fees, increased referral income, a growing loan platform, and greater engagement in services like brokerage and interchange. Meanwhile, financial services revenue per product jumped from $59 in Q4 2023 to $81 in Q4 2024, reflecting improved monetization.
SoFi’s transformation of its loan platform business is another important catalyst. Rather than simply originating and holding loans or selling them off to manage risk, the company now partners with institutional buyers to originate loans. This allows SoFi to earn fee income without taking on the risk of holding those loans itself. Importantly, SoFi retains servicing rights that drive cross-selling opportunities.
Another bright spot is SoFi’s growing deposit base. Since acquiring a bank license in 2022, deposits have surged to $26 billion. These deposits give the company access to low-cost funding, which lowers interest expenses and improves margins.
Is SoFi Stock a Buy Right Now?
Despite Wall Street analysts’ cautious “Hold” consensus rating, SoFi’s long-term fundamentals remain solid. The company’s focus on revenue diversification, fast-growing tech services, evolved loan platform business, and lower funding costs all combine to form a compelling growth narrative.
With the stock trading at a discount following a recent pullback and the ongoing momentum in its business, SoFi stock is a buy ahead of the Q1 earnings release.
