SoFi Reports Record Q4 Profit
Fintech lender SoFi Technologies saw its fourth-quarter profit rise sharply, driven by strong loan demand and rapid growth in fee-based businesses. Shares climbed 5.7% in premarket trading on Friday following the announcement.
Fee-Based Businesses Fuel Revenue Growth
SoFi’s financial services segment, including credit card and investing products, posted a 78% revenue increase to $456.7 million for the quarter ending December 31. Founded in 2011 as a student-loan refinancer, SoFi now offers personal loans, mortgages, investing, and payments, targeting younger, tech-savvy consumers. In addition, revenue from fee-based services rose 53% from a year earlier, helping the company manage exposure to interest-rate swings.
Record Loan Originations
Total loan originations reached $10.5 billion, up 46% from the prior year. Personal, student, and home loans all contributed to the growth. CEO Anthony Noto said credit performance met expectations, noting that overall financial health across spending, investing, and credit “remained strong.”
Policy Changes Could Boost Fintech Opportunities
Earlier this month, former U.S. President Donald Trump proposed a 10% cap on credit card interest rates. Banks have warned that such a cap could limit consumer access to credit. However, Noto explained that this could create opportunities for fintechs like SoFi, as personal loans may become a more common upfront financing option.
Financial Highlights
SoFi’s adjusted revenue for Q4 jumped 37% to a record $1 billion from a year earlier. Its adjusted profit more than doubled to 13 cents per share, up from 5 cents. Overall, the results demonstrate strong growth and resilience in SoFi’s diversified business model.
