Record GAAP and Adjusted Revenue for Fourth
Quarter and Full Year 2021 Fourth Quarter $286 Million GAAP Revenue
Up 67%, $280 Million Adjusted Revenue Up 54% Year-over-Year Fourth
Quarter Adjusted EBITDA of $5 Million Positive for 6th Straight
Quarter Record 523,000 Quarterly New Member Adds Up 39%
Sequentially Record 906,000 Quarterly New Product Adds Up 51%
Sequentially
SoFi Technologies, Inc. (NASDAQ: SOFI), a member-centric,
one-stop shop for digital financial services that helps members
borrow, save, spend, invest and protect their money, reported
financial results today for its fourth quarter and fiscal year
ended December 31, 2021.
This press release features multimedia. View
the full release here:
https://www.businesswire.com/news/home/20220301006130/en/
Note: For additional information on our
company metrics, see Table 5 in the “Financial Tables” herein.
(Graphic: Business Wire)
“We hit new highs across our key financial and operating metrics
in the fourth quarter, finishing 2021 with record annual results,”
said Anthony Noto, CEO of SoFi Technologies, Inc. “Adjusted net
revenue of $280 million was another quarterly record for us, up 54%
year-over-year and up sequentially, even with the unexpected
extension of the federal student loan payment moratorium in late
December. We exceeded $1 billion in annual adjusted net revenue for
the first time. We also delivered fourth quarter adjusted EBITDA of
$5 million — our sixth consecutive positive quarter — resulting in
positive full-year adjusted EBITDA of $30 million. The best part is
that we were able to reach both our adjusted revenue and adjusted
EBITDA milestones ahead of plan in an increasingly challenging
operating environment, while also significantly exceeding our
member growth guidance.”
Consolidated Results Summary
Three Months Ended December
31,
% Change
Year Ended December
31,
% Change
($ in thousands)
2021
2020
2021
2020
Consolidated – GAAP
Total net revenue
$
285,608
$
171,491
67
%
$
984,872
$
565,532
74
%
Net loss
(111,012
)
(82,616
)
34
%
(483,937
)
(224,053
)
116
%
Loss per share – basic and diluted
$
(0.15
)
$
(1.85
)
$
(1.00
)
$
(4.30
)
Consolidated – Non-GAAP
Adjusted net revenue(1)
$
279,876
$
182,019
54
%
$
1,010,325
$
621,207
63
%
Adjusted EBITDA(1)
4,593
11,817
(61
) %
30,221
(44,576
)
n/a
___________________
(1)
Adjusted net revenue and adjusted EBITDA
are non-GAAP financial measures. For more information and
reconciliations to the most comparable GAAP measures, see “Non-GAAP
Financial Measures” and Table 2 to the “Financial Tables”
herein.
Noto continued: “As important, we also reached all-time highs in
members added, products added and engagement as well. We finished
2021 with approximately 3.5 million total SoFi members, up 87%, or
1.6 million, from where we started the year, and approximately
500,000 ahead of our stated goal. We added a record 523,000 new
members in the fourth quarter — a new high in absolute number
terms, up 39% versus the number of net adds in Q3 2021. We also
extended our string of triple-digit year-over-year product growth
for the sixth consecutive quarter, adding 906,000 new products, up
51% versus the number of net adds in the third quarter, to end 2021
with a record 5.2 million products in total, more than 2.6 million,
or 105%, higher from where we started the year. We were able to
achieve these milestones in 2021 — and get to such a position of
strength today — for three main reasons: First, we continued to
drive strong growth through great execution across our three
diverse businesses, as we adapted to capitalize on changing macro
conditions. Second, the success of our unique Financial Services
Productivity Loop (FSPL) strategy accelerated as we scaled our
business in 2021 — allowing us to exceed our original 2021 member
growth target by 40% and still hit our adjusted EBITDA target. And
third, we took a giant step forward in 2021 in achieving our goal
of becoming a household brand name by investing in and growing our
brand awareness via our SoFi Stadium affiliation, the success of
our integrated multi-media campaigns and the virality of the
influencers with whom we partnered.”
Noto concluded: “Today, SoFi is in its strongest position ever
to differentiate our offerings and ensure that we're delivering for
our members and enhancing their experience with each new product
they adopt. Our new bank charter will be a game changer for us in
differentiating our SoFi Checking and Savings offering in the
marketplace, and improving our pricing and selection across
Lending. Acquiring Technisys, a leading cloud-native, digital
multi-product core banking platform, will be a critical next step
in our continued efforts to vertically integrate SoFi’s businesses
to further accelerate the pace of innovation of our best-of-breed
financial products. We expect Technisys to be a growth multiplier
for both SoFi and Galileo, in addition to realizing its own
enormous growth opportunities, which are further strengthened in
partnership with Galileo. We think we are well on our way to
building the AWS of fintech. We have the right strategy, offering,
leadership, liquidity and people to achieve our long-term strategic
goal to be the digital one-stop shop for our members for all of the
major financial decisions in their lives, and all of the moments in
between. Having just celebrated my fourth anniversary as CEO of
SoFi in February, I could not be more excited about what’s ahead,
and I feel like we are just getting started.”
Consolidated Results
Total GAAP net revenue of $285.6 million in the fourth quarter
of 2021 and $984.9 million for full-year 2021 increased 67% and
74%, respectively, from the corresponding prior-year periods of
$171.5 million and $565.5 million, respectively. On an adjusted
basis, net revenue of $279.9 million for the fourth quarter and
$1.01 billion for the full year were up 54% and 63%, respectively,
from the corresponding prior-year period totals of $182.0 million
and $621.2 million, respectively. Strength in all three of SoFi's
business segments drove the year-over-year growth in these
measures.
SoFi recorded a GAAP net loss of $111.0 million for the fourth
quarter of 2021 and $483.9 million for full-year 2021, versus the
prior-year periods' net losses of $82.6 million and $224.1 million,
respectively. Fourth quarter adjusted EBITDA of $4.6 million was
positive for the sixth consecutive quarter, culminating in
full-year positive adjusted EBITDA of $30.2 million.
Member and Product Growth
SoFi added a record number of both members and products in
absolute terms for the quarter and year. The SoFi Stadium
affiliation, together with successful integrated marketing and
influencer campaigns, took brand recognition to new highs, which
SoFi leveraged through better execution of its unique Financial
Services Productivity Loop (FSPL) strategy.
The five nationally televised NFL regular season games at SoFi
Stadium were seen by an average of more than 22 million households
per game, for 110 million-plus household impressions in total. This
visibility helped to increase SoFi’s unaided brand awareness by
nearly 70% in 2021, which reached a new record in the fourth
quarter. SoFi unaided brand awareness rose again in February 2022,
when an estimated 106 million people watched the Los Angeles Rams
win the Super Bowl at home at SoFi Stadium.
These brand-building strategies, coupled with referral and
cross-buy campaigns such as Refer the App, the SoFi Money Referral
program, the SoFi Money-Personal Loan bundle, and SoFi’s unique
rewards program, drove record new member and product additions.
SoFi added approximately 523,000 new members in the fourth quarter
– a record in absolute number terms and up 39% from the
approximately 377,000 new members added in the third quarter, to
finish 2021 at 3.5 million, up 1.6 million, or 87%, from 2020.
Total products added in the fourth quarter of approximately
906,000 were 51% higher than the approximately 600,000 added in the
third quarter, and up 105% year-over-year, for SoFi’s sixth
consecutive quarter of triple-digit growth. Total products of
nearly 5.2 million at year-end were more than double the 2.5
million at year-end 2020. With product growth exceeding member
growth in absolute terms, members are demonstrating high product
satisfaction and greater willingness to adopt additional products,
further reinforcing the value of SoFi’s unique FSPL strategy.
(1)
Beginning in the fourth quarter of 2021,
the Company included SoFi accounts on the Galileo
platform-as-a-service in its total Technology Platform accounts
metric to better align with presentation of Technology Platform
segment revenue. The Company recast the total accounts as of
December 31, 2020 to conform to the current year presentation,
which resulted in an increase of 375,367 in total accounts as of
such date. Quarterly amounts for the relevant quarters in 2021 and
2020 were determined to be immaterial, and as such were not
recast.
In the Financial Services segment, total products increased by
155% year-over-year, to 4.1 million from 1.6 million, driven
primarily by growth in SoFi Invest and SoFi Money offerings.
Lending products rose 18% in the fourth quarter, and were up
across all loan types. Record demand for personal loans was the
largest driver, followed by an increase in demand for student loans
in the lead-up to the anticipated January 2022 expiration of the
moratorium on federal student loan payments.
With the rapid growth in Financial Services products, SoFi
finished 2021 with nearly four times as many of these
high-frequency, low acquisition cost, “top-of-funnel” products as
low-frequency, high lifetime value (LTV), “bottom-of-funnel”
Lending products. With these “top-of-funnel” offerings driving
product growth, total company fourth quarter cross-buy volume — the
term for when existing SoFi members acquire an additional SoFi
product — more than tripled year-over-year, to SoFi’s highest
absolute number of cross-bought products ever.
Technology Platform enabled accounts increased by 67%
year-over-year to 99.7 million, due to both diverse new client
additions and growth among existing Galileo clients.
Lending Segment Results
Lending segment GAAP and adjusted net revenues were $213.8
million and $208.0 million, respectively, for the fourth quarter of
2021, and $738.3 million and $763.8 million, respectively, for the
full year. This represented quarterly year-over-year increases of
43% and 30%, respectively, and full year increases of 54% and 42%,
respectively, driven by growth in net interest income, and
origination and gain on sale revenue.
Lending segment contribution profit of $105.1 million, at a 51%
margin of adjusted Lending net revenue for the fourth quarter of
2021, increased 23% year-over-year, but declined sequentially from
the third quarter's $117.7 million of contribution profit at a 55%
margin. This sequential decline was primarily due to lower home
loan conversion at SoFi’s third-party fulfillment partner in home
loans, which reduced SoFi's ability to meet strong home loans
demand. These issues have since been resolved by the onboarding of
another third-party fulfillment partner. Additionally, higher
student loan refinancing marketing spend to drive volume in the
lead-up to the January 2022 federal student loan payment moratorium
expiration was not recouped when the moratorium was extended in
late-December, curtailing demand during the final week of the
quarter. Full-year Lending segment contribution profit of nearly
$400 million was up 65%, at a 52% margin.
Lending – Segment Results of
Operations
Three Months Ended
December 31,
Year Ended
December 31,
($ in thousands)
2021
2020
% Change
2021
2020
% Change
Total net revenue – Lending
$
213,764
$
148,992
43
%
$
738,323
$
480,866
54
%
Servicing rights – change in valuation
inputs or assumptions
(9,273
)
1,127
(923
)%
2,651
17,459
(85
) %
Residual interests classified as
debt – change in valuation inputs or assumptions
3,541
9,401
(62
) %
22,802
38,216
(40
) %
Directly attributable expenses
(102,967
)
(74,316
)
39
%
(364,169
)
(294,812
)
24
%
Contribution Profit
$
105,065
$
85,204
23
%
$
399,607
$
241,729
65
%
Adjusted net revenue –
Lending(1)
$
208,032
$
159,520
30
%
$
763,776
$
536,541
42
%
_________________
(1)
Adjusted net revenue – Lending represents
a non-GAAP financial measure. For more information and a
reconciliation to the most comparable GAAP measure, see “Non-GAAP
Financial Measures” and Table 2 to the “Financial Tables”
herein.
Fourth quarter Lending segment total origination volume
increased 67% year-over-year, with record volume in personal loan
originations and higher student loan originations more than
offsetting the decline in home loan volume.
Record personal loan originations of more than $1.6 billion in
the fourth quarter of 2021 were up $1.0 billion, or 168%,
year-over-year, and more than double fourth quarter 2019’s
pre-pandemic total. SoFi’s personal loans business outperformed due
to improved execution, technology and credit model enhancements, a
reopening of personal loan credit eligibility and continued strong
demand for its high-quality loans. Full-year personal loan
originations of more than $5.3 billion were more than double the
2020 total and 44% above 2019’s pre-Covid level. In addition,
providing loan referral fulfillment services to Pagaya, an
artificial intelligence (AI) network that facilitates credit
decisioning, enabled SoFi to access a broader audience to drive
further growth in personal loans without taking additional
underwriting risk.
In the fourth quarter, student loans benefited from accelerating
demand ahead of the January federal student loan payment moratorium
deadline and anticipated rate increases in 2022. Student loan
originations of nearly $1.5 billion increased 51% sequentially –
even with the unexpected late-December extension of the federal
student loan payment moratorium to May 2022. This suggests there
may be a rapid return to pre-pandemic student loan demand levels
once the payment moratorium expires.
Lending – Originations and Average
Balances
Three Months Ended
December 31,
% Change
Year Ended
December 31,
% Change
2021
2020
2021
2020
Origination volume ($ in thousands, during
period)
Home loans
$
657,304
$
672,724
(2
) %
$
2,978,222
$
2,183,521
36
%
Personal loans
1,646,289
613,774
168
%
5,386,934
2,580,757
109
%
Student loans
1,461,405
970,543
51
%
4,293,526
4,928,880
(13
) %
Total
$
3,764,998
$
2,257,041
67
%
$
12,658,682
$
9,693,158
31
%
Average loan balance ($, as of period
end)(1)
Home loans
$
286,991
$
291,382
(2
) %
Personal loans
22,820
21,789
5
%
Student loans
50,549
54,319
(7
) %
_________________
(1)
Within each loan product category, average
loan balance is defined as the total unpaid principal balance of
the loans divided by the number of loans that have a balance
greater than zero dollars as of the reporting date. Average loan
balance includes loans on the balance sheet and transferred loans
with which SoFi has a continuing involvement through its servicing
agreements.
December 31,
Lending – Products
2021
2020
% Change
Home loans
23,035
13,977
65
%
Personal loans
610,348
501,045
22
%
Student loans
445,569
402,623
11
%
Total lending products
1,078,952
917,645
18
%
Technology Platform Segment Results
SoFi's Technology Platform segment consists primarily of Galileo
Financial Technologies, LLC (Galileo), a technology infrastructure
provider acquired in May 2020. Galileo signed nine new clients
during the fourth quarter, for a full year 2021 total of 44. Client
accounts enabled by Galileo rose 67% year-over-year, to
approximately 100 million from approximately 60 million, through
new client acquisition and growth at existing clients. Galileo has
also expanded its client base to include B2B and enterprise
clients, as adoption of modern digital payments and banking has
opened up new verticals, client types, use cases and
opportunities.
December 31,
Technology Platform
2021
2020
% Change
Total accounts
99,660,657
59,735,210
67 %
Technology Platform segment net revenue of $53.3 million for the
fourth quarter of 2021, and $194.9 million for the full year, was
up 42% and 102%, respectively, from the comparable prior year
periods. SoFi continues to invest heavily to capture Galileo’s
significant and accelerating secular growth opportunities. This
intentional increased investment drove quarterly Galileo operating
expenses 61% higher year-over-year, and lowered the contribution
margin from 45% to 38% in the fourth quarter. Maintaining this high
level of investment for sustained, long-term growth is expected to
require operating the business at a 20–30% contribution margin
range for the foreseeable future.
Technology Platform – Segment Results
of Operations
Three Months Ended
December 31,
Year Ended
December 31,
($ in thousands)
2021
2020
% Change
2021
2020
% Change
Total net revenue
$
53,299
$
37,482
42
%
$
194,886
$
96,316
102
%
Directly attributable expenses
(33,291
)
(20,676
)
61
%
(130,439
)
(42,427
)
207
%
Contribution Profit
$
20,008
$
16,806
19
%
$
64,447
$
53,889
20
%
Financial Services Segment Results
Fourth quarter 2021 net revenue of nearly $22.0 million was more
than five times the prior year period's total of $4.1 million,
demonstrating SoFi’s rapid progress in monetizing this segment. The
Financial Services segment contribution loss of $35.2 million
improved by $1.6 million from the prior year quarter's $36.8
million loss, due to the benefits of ongoing investments for
growth. For the full year, the segment delivered $58.1 million of
revenue, a nearly five-fold increase from the prior year’s $11.9
million total, and the $134.9 million contribution loss was
essentially flat versus $132.1 million in the prior year
period.
Financial Services – Segment Results of
Operations
Three Months Ended
December 31,
Year Ended
December 31,
($ in thousands)
2021
2020
% Change
2021
2020
% Change
Total net revenue
$
21,956
$
4,051
442
%
$
58,078
$
11,870
389
%
Directly attributable expenses
(57,145
)
(40,804
)
40
%
(192,996
)
(143,966
)
34
%
Contribution loss
$
(35,189
)
$
(36,753
)
(4
) %
$
(134,918
)
$
(132,096
)
2
%
By continuously innovating for members with new and relevant
offerings, features and rewards, SoFi added approximately 2.5
million Financial Services products in 2021, bringing the total to
approximately 4.1 million. Triple-digit growth in SoFi Money and
SoFi Invest products were the largest drivers of the 155%
year-over-year increase in total Financial Services products. New
SoFi Money features in 2021 include two-day early paycheck,
autosave, cashback, and no-fee overdraft protection. SoFi's new
SoFi Checking and Savings offering is truly differentiated in the
category, with a 1% annual percentage yield for direct deposit
members — 33 times the national average — and no minimum balance
requirements, plus many of the free features SoFi Money members
historically enjoyed.
SoFi Invest expanded member selection in both cryptocurrencies
and retail IPOs in 2021. Two new crypto coin additions in the
fourth quarter brought the full-year total added to 25, and the
year-end total of 30 placed SoFi among the selection leaders in the
space. SoFi Invest also brought two regular-way IPOs to members in
the fourth quarter — as the primary retail channel for Rivian, the
largest IPO since Facebook in 2012, and Nubank, a leading fintech
company in Brazil. SoFi introduced stop-limit trade orders in the
fourth quarter as well, and added margin trading in the first
quarter of 2022. The SoFi Credit Card — with a unique Rewards
platform that awards points for both transactions and smart
financial behaviors — experienced strong take-up in its first full
year. Total accounts grew from approximately 6,000 to more than
91,000 from the beginning through the end of 2021, and quarterly
spend, balances and accounts averaged high double-digit growth
throughout the year. In addition, SoFi’s partnership with Pagaya
resulted in nearly 7,700 referred loans, a promising debut in its
first full quarter.
December 31,
Financial Services – Products
2021
2020
% Change
Money
1,436,955
645,502
123 %
Invest
1,595,143
531,541
200 %
Credit Card
91,216
6,445
n/m
Referred loans
7,659
—
n/m
Relay
930,181
408,735
128 %
At Work
33,091
13,687
142 %
Total products
4,094,245
1,605,910
155 %
Subsequent Events
National Bank Charter Approval
A key element of SoFi’s long-term strategy has been to secure a
national bank charter. In January 2022, SoFi received regulatory
approval to become a bank holding company and to acquire Golden
Pacific Bancorp, Inc., and its wholly-owned subsidiary, Golden
Pacific Bank, National Association, a national bank (“Golden
Pacific Bank”) (such acquisition, the “Bank Merger”). SoFi also
received approval to change the composition of Golden Pacific
Bank’s assets. The Bank Merger closed in February 2022, after which
SoFi became a bank holding company and Golden Pacific Bank began
operating as SoFi Bank.
Management's view is that operating as a bank holding company
can enhance SoFi’s overall profitability. Management believes that
moving from a reliance on third-party bank holding companies by
operating under a national bank charter will allow SoFi to provide
current and prospective members broader and more competitive
options across their financial services needs, including deposit
accounts and loan products, while lowering the overall cost to fund
loans (by utilizing members’ deposits held at SoFi Bank instead of
third parties to fund loans). This is expected to enable SoFi to
offer lower interest rates on loans to members, as well as
competitive interest rates on SoFi Checking and Savings accounts
that elect direct deposit, without having to charge non-interest
based fees. With the Bank Merger complete, SoFi has begun to
transfer SoFi Money products to SoFi Bank, and intends to continue
to transfer its Lending, SoFi Money and SoFi Credit Card products
to SoFi Bank over time.
Technisys Acquisition
On February 22, 2022, SoFi Technologies, Inc. announced that it
had entered into an agreement and plan of merger (the “Merger
Agreement”) to acquire Technisys, a leading cloud-native, digital
multi-product core banking platform, at a transaction value of
approximately $1.1 billion. Technisys’ shareholders will receive a
base consideration of approximately 84 million shares, subject to
customary adjustments set forth in the terms of the Merger
Agreement. The transaction is subject to satisfaction of certain
closing conditions.
Management believes the acquisition of Technisys will provide a
critical strategic asset, as both an attractive business, and an
innovative technology advancing SoFi’s effort to build the AWS of
Fintech and its ambition to provide best-of-breed products on a
one-stop shop platform that meets all of its members’ financial
needs. In management's view, combining Technisys’ Cyberbank
platform with Galileo will create one of the most modern full-stack
offerings available with multi-product capabilities — including
deposit, checking, lending, credit cards and investing as well as
future products — all surfaced through industry-leading APIs. In
addition, it is believed that the growth opportunities of both
Galileo and Technisys will expand meaningfully as a result of
gaining access to each company's large installed client base. SoFi
expects to also be able to leverage this next-generation technology
stack to continue building its best-of-breed products and services
by integrating Technisys’ leading, cloud-native, multi-product
digital banking core with Galileo’s cloud-based
platform-as-a-service capabilities.
Following the close of the acquisition, Technisys will continue
to operate as an independent subsidiary of SoFi Technologies, Inc.
and as part of its Technology Platform segment, with Miguel Santos
continuing as CEO.
Guidance and Outlook
For note, management expects the incremental net interest income
revenue from SoFi Bank to only contribute nominally to first
quarter 2022 results, and prior to fully originating loans in SoFi
Bank, which is currently expected in May 2022. When SoFi began
operating SoFi Bank in February, it did not contribute any existing
SoFi loans to SoFi Bank and initially capitalized SoFi Bank
entirely with cash. Operations are still in transition to allow
loan originations to occur from SoFi Bank. That transition is not
expected to be fully complete until the end of May 2022.
Over the last several quarters, SoFi’s unique, diversified
business model has proven to be an increasingly powerful
competitive advantage. Even as SoFi continues to invest and scale,
the expectation is for that strength and momentum to continue.
SoFi’s guidance for the first quarter of 2022 incorporates the
negative impact of the unexpected extension of the federal student
loan payment moratorium to May 1, 2022. Management estimates the
negative impact to be approximately $30 to $35 million of revenue
and $20 to $25 million of contribution profit in the first quarter,
with the expectation that loan origination levels for the entire
quarter will remain consistent with those of the first three
quarters of 2021. Management expects to generate $280 to $285
million of adjusted net revenue in the first quarter of 2022, up
30% to 32% year-over-year, and up modestly sequentially, and $0 to
$5 million of adjusted EBITDA.
Had the moratorium expired in January, management estimates that
first quarter 2022 adjusted revenue would have been in the range of
$310 to $320 million, and adjusted EBITDA would have been $20 to
$30 million.
For the full year 2022, management expects to grow adjusted net
revenue 55% year-over-year, to $1.57 billion, and deliver adjusted
EBITDA of $180 million. Several recent developments factor into
current full-year guidance:
- First, management assumes the moratorium on federal student
loan payments expires as currently contemplated on May 1, 2022 and
student loan refinance origination volume normalizes to pre-Covid
levels partway through the second quarter, and remains at those
levels from that point through the remainder of 2022.
- Second, management assumes that SoFi Bank will begin
contributing to SoFi’s results more meaningfully in the second
quarter of 2022, rather than in the first quarter, when SoFi Bank
was opened. Because SoFi Bank was initially capitalized with cash
from the balance sheet, not loans, SoFi will not begin to realize
the lower cost of capital benefits of SoFi Bank until it can
originate and fund loans in SoFi Bank. Management believes it will
take until the second quarter of 2022 to build the appropriate loan
balances to see more than a nominal impact.
- Third, management assumes that Technisys revenue growth will be
20% to 25% for full-year 2022, and will begin contributing to
SoFi's results following the close of the transaction.
- Fourth, management expects the core SoFi business (excluding
the impact of Technisys) to deliver incremental adjusted EBITDA
margins of 30% in 2022, consistent with previously articulated
plans to continue investing to drive sustainable long-term growth.
Management expects Technisys to contribute a minimal amount to
adjusted EBITDA in 2022, primarily because 2021 was a year of
significant investment for Technisys. Over time, management expects
the Technisys business to be additive to consolidated incremental
adjusted EBITDA margins.
Management currently forecasts Stock-Based Compensation expense
of $80 to $85 million for the first quarter of 2022 and $340
million for the full year.
Earnings Webcast
SoFi’s executive management team will host a live audio webcast
beginning at 5:00 p.m. Eastern Time (2:00 p.m. Pacific Time) today
to discuss the quarter’s financial results and business highlights.
All interested parties are invited to listen to the live webcast at
https://investors.sofi.com. A replay of the webcast will be
available on the SoFi Investor Relations website for 30 days.
Investor information, including supplemental financial information,
is available on SoFi’s Investor Relations website at
https://investors.sofi.com.
Cautionary Statement Regarding Forward-Looking
Statements
Certain of the statements above are forward-looking and as such
are not historical facts. This includes, without limitation,
statements regarding the financial position, business strategy and
the plans and objectives of management for our future operations.
These forward-looking statements are not guarantees of performance.
Such statements can be identified by the fact that they do not
relate strictly to historical or current facts. Words such as
“anticipate”, “believe”, “continue”, “could”, “estimate”, “expect”,
“intend”, “may”, "opportunity", "future", "strategy", “might”,
“plan”, “possible”, “potential”, “predict”, “project”, “should”,
“strive”, “suggests”, “would”, “will be”, “will continue”, “will
likely result” and similar expressions may identify forward-looking
statements, but the absence of these words does not mean that a
statement is not forward-looking. Factors that could cause actual
results to differ materially from those contemplated by these
forward-looking statements include: (i) the effect of and
uncertainties related to the COVID-19 pandemic (including any
government responses thereto); (ii) our ability to achieve and
maintain profitability and continued growth across our three
businesses in the future; (iii) the impact on our business of the
regulatory environment and complexities with compliance related to
such environment, including any further extension of the student
loan payment moratorium and our expectations regarding the return
to pre-pandemic student loan demand levels; (iv) our ability to
realize the benefits of becoming a bank holding company and
operating SoFi Bank; (v) our ability to respond and adapt to
changing market and economic conditions, including inflationary
pressures; (vi) our ability to continue to drive brand awareness
and realize the benefits or our integrated multi-media marketing
and advertising campaigns; (vii) our ability to vertically
integrate our businesses and accelerate the pace of innovation of
our financial products; (viii) our ability to manage our growth
effectively and our expectations regarding the development and
expansion of our business; (ix) our ability to access sources of
capital, including debt financing and other sources of capital to
finance operations and growth; (x) the success of our continued
investments in our Financial Services segment and in our business
generally; (xi) the success of our marketing efforts and our
ability to expand our member base; (xii) our ability to maintain
our leadership position in certain categories of our business and
to grow market share in existing markets or any new markets we may
enter; (xiii) our ability to develop new products, features and
functionality that are competitive and meet market needs; (xiv) our
ability to realize the benefits of our strategy, including what we
refer to as our FSPL; (xv) our ability to make accurate credit and
pricing decisions or effectively forecast our loss rates; (xvi) our
ability to establish and maintain an effective system of internal
controls over financial reporting; (xvii) our expectations with
respect to our anticipated investment levels in our Technology
Platform segment and our expected margins in that segment; (xviii)
our ability to close the acquisition of Technisys and realize the
anticipated benefits of such acquisition; and (xix) the outcome of
any legal or governmental proceedings that may be instituted
against us. The foregoing list of factors is not exhaustive. You
should carefully consider the foregoing factors and the other risks
and uncertainties set forth in the section titled “Risk Factors” in
our last quarterly report on Form 10-Q, as filed with the
Securities and Exchange Commission, and those that are included in
any of our future filings with the Securities and Exchange
Commission, including our annual report on Form 10-K, under the
Exchange Act.
These forward-looking statements are based on information
available as of the date hereof and current expectations, forecasts
and assumptions, and involve a number of judgments, risks and
uncertainties. Accordingly, forward-looking statements should not
be relied upon as representing our views as of any subsequent date,
and we do not undertake any obligation to update forward-looking
statements to reflect events or circumstances after the date they
were made, whether as a result of new information, future events or
otherwise, except as may be required under applicable securities
laws.
As a result of a number of known and unknown risks and
uncertainties, our actual results or performance may be materially
different from those expressed or implied by these forward-looking
statements. You should not place undue reliance on these
forward-looking statements.
Non-GAAP Financial Measures
This press release presents information about our adjusted net
revenue and adjusted EBITDA, which are non-GAAP financial measures
provided as supplements to the results provided in accordance with
accounting principles generally accepted in the United States
(GAAP). We use adjusted net revenue and adjusted EBITDA to evaluate
our operating performance, formulate business plans, help better
assess our overall liquidity position, and make strategic
decisions, including those relating to operating expenses and the
allocation of internal resources. Accordingly, we believe that
adjusted net revenue and adjusted EBITDA provide useful information
to investors and others in understanding and evaluating our
operating results in the same manner as our management. These
non-GAAP measures are presented for supplemental informational
purposes only, have limitations as analytical tools, and should not
be considered in isolation from, or as a substitute for, the
analysis of other GAAP financial measures, such as total net
revenue and net income (loss). Other companies may not use these
non-GAAP measures or may use similar measures that are defined in a
different manner. Therefore, SoFi's non-GAAP measures may not be
directly comparable to similarly titled measures of other
companies. Reconciliations of these non-GAAP measures to the most
directly comparable GAAP financial measures are provided in Table 2
to the “Financial Tables” herein.
Forward-looking non-GAAP financial measures are presented
without reconciliations of such forward-looking non-GAAP measures
because the GAAP financial measures are not accessible on a
forward-looking basis and reconciling information is not available
without unreasonable effort due to the inherent difficulty in
forecasting and quantifying certain amounts that are necessary for
such reconciliations, including adjustments reflected in our
reconciliation of historic non-GAAP financial measures, the amounts
of which, based on historical experience, could be material.
About SoFi
SoFi's mission is to help our members achieve financial
independence to realize their ambitions. Our products for
borrowing, saving, spending, investing and protecting give our
approximately three and a half million members fast access to tools
to get their money right. SoFi membership comes with the key
essentials for getting ahead, including career advisors and
connection to a thriving community of like-minded, ambitious
people. SoFi is also the naming rights partner of SoFi Stadium,
home of the Los Angeles Chargers and the Los Angeles Rams. For more
information, visit https://www.sofi.com or download our iOS and
Android apps.
Availability of Other Information About SoFi
Investors and others should note that we communicate with our
investors and the public using our website (www.sofi.com), the
investor relations website (https://investors.sofi.com), and on
social media (Twitter and LinkedIn), including but not limited to
investor presentations and investor fact sheets, Securities and
Exchange Commission filings, press releases, public conference
calls and webcasts. The information that SoFi posts on these
channels and websites could be deemed to be material information.
As a result, SoFi encourages investors, the media, and others
interested in SoFi to review the information that is posted on
these channels, including the investor relations website, on a
regular basis. This list of channels may be updated from time to
time on SoFi’s investor relations website and may include
additional social media channels. The contents of SoFi’s website or
these channels, or any other website that may be accessed from its
website or these channels, shall not be deemed incorporated by
reference in any filing under the Securities Act of 1933, as
amended.
FINANCIAL TABLES
1. Consolidated Statements of Operations and Comprehensive
Loss
2. Reconciliation of GAAP to Non-GAAP Financial Measures
3. Consolidated Balance Sheets
4. Consolidated Statements of Cash Flows
5. Company Metrics
6. Segment Financials
Table 1
SoFi Technologies,
Inc.
Consolidated Statements of
Operations and Comprehensive Loss
(In Thousands, Except for
Share and Per Share Data)
Three Months Ended December
31,
Year Ended December
31,
2021
2020
2021
2020
Interest income
Loans
$
91,119
$
85,622
$
337,862
$
330,353
Securitizations
2,849
5,133
14,109
24,031
Related party notes
—
480
211
3,189
Other
815
838
2,838
5,964
Total interest income
94,783
92,073
355,020
363,537
Interest expense
Securitizations and warehouses
15,067
33,669
90,485
155,150
Corporate borrowings
2,593
19,125
10,345
27,974
Other
546
456
1,946
2,482
Total interest expense
18,206
53,250
102,776
185,606
Net interest income
76,577
38,823
252,244
177,931
Noninterest income
Loan origination and sales
135,415
100,241
497,626
371,323
Securitizations
(8,249
)
(7,249
)
(14,862
)
(70,251
)
Servicing
9,594
(1,128
)
(2,281
)
(19,426
)
Technology platform fees
51,287
38,521
191,847
90,128
Other
20,984
2,283
60,298
15,827
Total noninterest income
209,031
132,668
732,628
387,601
Total net revenue
285,608
171,491
984,872
565,532
Noninterest expense
Technology and product development
66,316
57,767
276,087
201,199
Sales and marketing
129,705
72,182
426,875
276,577
Cost of operations
69,195
53,010
256,980
178,896
General and administrative
125,160
76,097
498,534
237,381
Provision for credit losses
4,686
—
7,573
—
Total noninterest expense
395,062
259,056
1,466,049
894,053
Loss before income taxes
(109,454
)
(87,565
)
(481,177
)
(328,521
)
Income tax (expense) benefit
(1,558
)
4,949
(2,760
)
104,468
Net loss
$
(111,012
)
$
(82,616
)
$
(483,937
)
$
(224,053
)
Other comprehensive loss
Unrealized losses on available-for-sale
securities, net
(1,201
)
—
(1,351
)
—
Foreign currency translation adjustments,
net
188
(126
)
46
(145
)
Total other comprehensive loss
(1,013
)
(126
)
(1,305
)
(145
)
Comprehensive loss
$
(112,025
)
$
(82,742
)
$
(485,242
)
$
(224,198
)
Loss per share
Loss per share – basic
$
(0.15
)
$
(1.85
)
$
(1.00
)
$
(4.30
)
Loss per share – diluted
$
(0.15
)
$
(1.85
)
$
(1.00
)
$
(4.30
)
Weighted average common stock
outstanding – basic
814,507,200
78,480,471
526,730,261
73,851,108
Weighted average common stock
outstanding – diluted
814,507,200
78,480,471
526,730,261
73,851,108
Table 2
Non-GAAP Financial Measures
Reconciliation of Adjusted Net Revenue
Adjusted net revenue is defined as total net revenue, adjusted
to exclude the fair value changes in servicing rights and residual
interests classified as debt due to valuation inputs and
assumptions changes, which relate only to our Lending segment. For
our consolidated results and for the Lending segment, we reconcile
adjusted net revenue to total net revenue, the most directly
comparable GAAP measure, as presented for the periods indicated
below:
Three Months Ended December
31,
Year Ended December
31,
($ in thousands)
2021
2020
2021
2020
Total net revenue
$
285,608
$
171,491
$
984,872
$
565,532
Servicing rights – change in valuation
inputs or assumptions(1)
(9,273
)
1,127
2,651
17,459
Residual interests classified as
debt – change in valuation inputs or assumptions(2)
3,541
9,401
22,802
38,216
Adjusted net revenue
$
279,876
$
182,019
$
1,010,325
$
621,207
Three Months Ended December
31,
Year Ended December
31,
($ in thousands)
2021
2020
2021
2020
Total net revenue – Lending
$
213,764
$
148,992
$
738,323
$
480,866
Servicing rights – change in valuation
inputs or assumptions(1)
(9,273
)
1,127
2,651
17,459
Residual interests classified as
debt – change in valuation inputs or assumptions(2)
3,541
9,401
22,802
38,216
Adjusted net revenue – Lending
$
208,032
$
159,520
$
763,776
$
536,541
___________________
(1)
Reflects changes in fair value inputs and
assumptions on servicing rights, including conditional prepayment
and default rates and discount rates. These assumptions are highly
sensitive to market interest rate changes and are not indicative of
our performance or results of operations. Moreover, these non-cash
charges are unrealized during the period and, therefore, have no
impact on our cash flows from operations. As such, these positive
and negative changes are adjusted out of total net revenue to
provide management and financial users with better visibility into
the net revenue available to finance our operations and our overall
performance.
(2)
Reflects changes in fair value inputs and
assumptions on residual interests classified as debt, including
conditional prepayment and default rates and discount rates. When
third parties finance our consolidated securitization variable
interest entities (“VIEs”) by purchasing residual interests, we
receive proceeds at the time of the closing of the securitization
and, thereafter, pass along contractual cash flows to the residual
interest owner. These residual debt obligations are measured at
fair value on a recurring basis, but they have no impact on our
initial financing proceeds, our future obligations to the residual
interest owner (because future residual interest claims are limited
to contractual securitization collateral cash flows), or the
general operations of our business. As such, these positive and
negative non-cash changes in fair value attributable to assumption
changes are adjusted out of total net revenue to provide management
and financial users with better visibility into the net revenue
available to finance our operations.
Reconciliation of Adjusted EBITDA
Adjusted EBITDA is defined as net income (loss), adjusted to
exclude: (i) corporate borrowing-based interest expense (our
adjusted EBITDA measure is not adjusted for warehouse or
securitization-based interest expense, nor deposit interest expense
and finance lease liability interest expense, as discussed further
below), (ii) income tax expense (benefit), (iii) depreciation and
amortization, (iv) share-based expense (inclusive of equity-based
payments to non-employees), (v) transaction-related expenses, (vi)
fair value changes in warrant liabilities, and (vii) fair value
changes in each of servicing rights and residual interests
classified as debt due to valuation assumptions. We reconcile
adjusted EBITDA to net loss, the most directly comparable GAAP
measure, for the periods indicated below:
Three Months Ended December
31,
Year Ended December
31,
($ in thousands)
2021
2020
2021
2020
Net loss
$
(111,012
)
$
(82,616
)
$
(483,937
)
$
(224,053
)
Non-GAAP adjustments:
Interest expense – corporate
borrowings(1)
2,593
19,125
10,345
27,974
Income tax expense (benefit)(2)
1,558
(4,949
)
2,760
(104,468
)
Depreciation and amortization(3)
26,527
25,486
101,568
69,832
Share-based expense
77,082
30,089
239,371
100,778
Transaction-related expense(4)
2,753
—
27,333
9,161
Fair value changes in warrant
liabilities(5)
10,824
14,154
107,328
20,525
Servicing rights – change in valuation
inputs or assumptions(6)
(9,273
)
1,127
2,651
17,459
Residual interests classified as
debt – change in valuation inputs or assumptions(7)
3,541
9,401
22,802
38,216
Total adjustments
115,605
94,433
514,158
179,477
Adjusted EBITDA
$
4,593
$
11,817
$
30,221
$
(44,576
)
___________________
(1)
Our adjusted EBITDA measure adjusts for
corporate borrowing-based interest expense, as these expenses are a
function of our capital structure. Corporate borrowing-based
interest expense primarily included (i) interest on our revolving
credit facility, (ii) amortization of debt discount and debt
issuance costs on our convertible notes, and (iii) interest on the
seller note issued in connection with our acquisition of Galileo.
Our adjusted EBITDA measure does not adjust for interest expense on
warehouse facilities and securitization debt, which are recorded
within interest expense—securitizations and warehouses in the
consolidated statements of operations and comprehensive income
(loss), as these interest expenses are direct operating expenses
driven by loan origination and sales activity. Additionally, our
adjusted EBITDA measure does not adjust for interest expense on
SoFi Money deposits or interest expense on our finance lease
liability in connection with SoFi Stadium, which are recorded
within interest expense—other, as these interest expenses are
direct operating expenses driven by SoFi Money deposits and finance
leases, respectively. The fluctuations in interest expense were
impacted by interest expense on the Galileo seller note, which was
issued in May 2020 and repaid in February 2021, as well as the
amortization of debt discount and debt issuance costs on our
convertible notes, which were issued in October 2021. Revolving
credit facility interest expense decreased modestly during 2021
relative to 2020, as a higher average balance in 2021 was more than
offset by a decrease in LIBOR, and increased during 2020 relative
to 2019 primarily due to a higher average balance following the
acquisition of Galileo.
(2)
Our income tax expense positions in 2021
and 2019 were primarily a function of SoFi Lending Corp.’s
profitability in state jurisdictions where separate filings are
required. Our income tax benefit position in 2020 was primarily due
to a partial release of our valuation allowance in the second
quarter in connection with deferred tax liabilities resulting from
intangible assets acquired from Galileo in May 2020.
(3)
Depreciation and amortization expense for
2021 increased compared to 2020 primarily due to the amortization
of intangible assets recognized during the second quarter of 2020
associated with the Galileo and 8 Limited acquisitions,
amortization of purchased and internally-developed software, and
depreciation related to SoFi Stadium fixed assets, partially offset
by a decrease related to the acceleration of core banking
infrastructure amortization. Depreciation and amortization expense
for 2020 compared to 2019 increased primarily due to amortization
expense on intangible assets acquired during the second quarter of
2020 from Galileo and 8 Limited, acceleration of core banking
infrastructure amortization, and amortization of purchased and
internally-developed software.
(4)
Transaction-related expenses during 2021
included a $21.2 million special payment to the Series 1 preferred
stockholders in conjunction with the Business Combination and
financial advisory and professional costs associated with
transactions that occurred during the period. We incurred such
costs as follows: (i) $2.2 million related to our acquisition of
Golden Pacific Bank, (ii) $3.3 million related to a recently
announced acquisition, and (iii) $0.6 million related to debt and
equity transactions, including our convertible debt, capped call
and secondary offering on behalf of certain investors. During 2020,
transaction-related expenses included certain costs, such as
financial advisory and professional services costs, associated with
our acquisitions of Galileo and 8 Limited.
(5)
Our adjusted EBITDA measure excludes the
non-cash fair value changes in warrants accounted for as
liabilities, which were measured at fair value through earnings.
The amounts in 2019 and 2020, as well as a portion of 2021, related
to changes in the fair value of Series H warrants issued by Social
Finance in 2019 in connection with certain redeemable preferred
stock issuances. We did not measure the Series H warrants at fair
value subsequent to May 28, 2021 in conjunction with the Business
Combination, as they were reclassified into permanent equity. In
addition, in conjunction with the Business Combination, SoFi
Technologies assumed certain common stock warrants (“SoFi
Technologies warrants”) that were accounted for as liabilities and
measured at fair value on a recurring basis. The fair value of the
SoFi Technologies warrants was based on the closing price of ticker
SOFIW and, therefore, fluctuated based on market activity. The vast
majority of outstanding SoFi Technologies warrants were exercised
during the fourth quarter of 2021, and therefore the Company
incurred gains and losses associated with fair value changes until
the warrant liabilities converted into SoFi common stock. The
remaining unexercised warrants were redeemed at a redemption price
of $0.10 on December 6, 2021.
(6)
Reflects changes in fair value inputs and
assumptions, including market servicing costs, conditional
prepayment and default rates and discount rates. This non-cash
change is unrealized during the period and, therefore, has no
impact on our cash flows from operations. As such, these positive
and negative changes in fair value attributable to assumption
changes are adjusted out of net loss to provide management and
financial users with better visibility into the earnings available
to finance our operations.
(7)
Reflects changes in fair value inputs and
assumptions, including conditional prepayment and default rates and
discount rates. When third parties finance our consolidated VIEs
through purchasing residual interests, we receive proceeds at the
time of the securitization close and, thereafter, pass along
contractual cash flows to the residual interest owner. These
obligations are measured at fair value on a recurring basis, which
has no impact on our initial financing proceeds, our future
obligations to the residual interest owner (because future residual
interest claims are limited to contractual securitization
collateral cash flows), or the general operations of our business.
As such, these positive and negative non-cash changes in fair value
attributable to assumption changes are adjusted out of net loss to
provide management and financial users with better visibility into
the earnings available to finance our operations.
Table 3
SoFi Technologies,
Inc.
Consolidated Balance
Sheets
(In Thousands, Except for
Share Data)
December 31,
2021
2020
Assets
Cash and cash equivalents
$
494,711
$
872,582
Restricted cash and restricted cash
equivalents
273,726
450,846
Investments in available-for-sale
securities (amortized cost of $195,796 and $0, respectively)
194,907
—
Loans, less allowance for credit losses on
loans at amortized cost of $7,037 and $219, respectively
6,068,884
4,879,303
Servicing rights
168,259
149,597
Securitization investments
374,688
496,935
Equity method investments
19,739
107,534
Property, equipment and software
111,873
81,489
Goodwill
898,527
899,270
Intangible assets
284,579
355,086
Operating lease right-of-use assets
115,191
116,858
Related party notes receivable
—
17,923
Other assets, less allowance for credit
losses of $2,292 and $562, respectively
171,242
136,076
Total assets
$
9,176,326
$
8,563,499
Liabilities, temporary equity and
permanent equity (deficit)
Liabilities:
Accounts payable, accruals and other
liabilities
$
298,164
$
452,909
Operating lease liabilities
138,794
139,796
Debt
3,947,983
4,798,925
Residual interests classified as debt
93,682
118,298
Total liabilities
4,478,623
5,509,928
Commitments, guarantees, concentrations
and contingencies
Temporary equity:
Redeemable preferred stock, $0.00 par
value: 100,000,000 and 570,562,965 shares authorized; 3,234,000 and
469,150,522 shares issued and outstanding as of December 31, 2021
and 2020, respectively
320,374
3,173,686
Permanent equity (deficit):
Common stock, $0.00 par value:
3,100,000,000 and 789,167,056 shares authorized; 828,154,462 and
115,084,358 shares issued and outstanding as of December 31, 2021
and 2020, respectively
83
—
Additional paid-in capital
5,561,831
579,228
Accumulated other comprehensive loss
(1,471
)
(166
)
Accumulated deficit
(1,183,114
)
(699,177
)
Total permanent equity (deficit)
4,377,329
(120,115
)
Total liabilities, temporary equity and
permanent equity (deficit)
$
9,176,326
$
8,563,499
Table 4
SoFi Technologies,
Inc.
Consolidated Statements of
Cash Flows
(In Thousands)
Year Ended December
31,
2021
2020
Operating activities
Net loss
$
(483,937
)
$
(224,053
)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation and amortization
101,568
69,832
Deferred debt issuance and discount
expense
18,292
28,310
Share-based compensation expense
239,011
99,870
Equity-based payments to non-employees
360
908
Deferred income taxes
1,204
(104,504
)
Equity method investment earnings
261
(4,314
)
Accretion of seller note interest
expense
—
6,002
Fair value changes in residual interests
classified as debt
22,802
38,216
Fair value changes in securitization
investments
(6,538
)
(13,919
)
Fair value changes in warrant
liabilities
107,328
20,525
Fair value adjustment to related party
notes receivable
(169
)
319
Other
(5,085
)
803
Changes in operating assets and
liabilities:
Originations and purchases of loans
(13,500,706
)
(10,406,813
)
Proceeds from sales and repayments of
loans
12,202,525
9,949,805
Other changes in loans
(10,148
)
(58,743
)
Servicing assets
(18,662
)
52,021
Related party notes receivable interest
income
1,399
1,121
Other assets
(10,700
)
(29,883
)
Accounts payable, accruals and other
liabilities
(9,022
)
95,161
Net cash used in operating activities
$
(1,350,217
)
$
(479,336
)
Investing activities
Purchases of property, equipment, software
and intangible assets
$
(52,261
)
$
(24,549
)
Related party notes receivable
issuances
—
(7,643
)
Proceeds from repayment of related party
notes receivable
16,693
—
Purchases of available-for-sale
investments
(246,372
)
—
Proceeds from sales of available-for-sale
investments
52,742
—
Proceeds from maturities of
available-for-sale investments
4,799
—
Purchases of non-securitization
investments
(22,000
)
(145
)
Proceeds from non-securitization
investments
109,534
974
Proceeds from securitization
investments
247,058
322,704
Acquisition of business, net of cash
acquired
—
(32,392
)
Net cash provided by investing
activities
$
110,193
$
258,949
SoFi Technologies,
Inc.
Consolidated Statements of
Cash Flows (Continued)
(In Thousands)
Year Ended December
31,
2021
2020
Financing activities
Proceeds from debt issuances
$
9,521,314
$
10,234,378
Repayment of debt
(10,429,176
)
(9,708,991
)
Payment of debt issuance costs
(9,465
)
(16,443
)
Purchase of capped calls
(113,760
)
—
Taxes paid related to net share settlement
of share-based awards
(42,644
)
(31,259
)
Purchases of common stock
(526
)
(40
)
Redemptions of redeemable common and
preferred stock
(282,859
)
—
Proceeds from Business Combination and
PIPE Investment
1,989,851
—
Payment of costs directly attributable to
the issuance of common stock in connection with Business
Combination and PIPE Investment
(26,951
)
—
Proceeds from stock option exercises
25,154
3,781
Proceeds from warrant exercises
95,047
—
Payment of redeemable preferred stock
dividends
(40,426
)
(40,536
)
Payment of deferred equity costs
(56
)
—
Finance lease principal payments
(516
)
(489
)
Note receivable principal repayments from
stockholder
—
43,513
Proceeds from common stock issuances
—
369,840
Net cash provided by financing
activities
$
684,987
$
853,754
Effect of exchange rates on cash and cash
equivalents
46
(145
)
Net (decrease) increase in cash, cash
equivalents, restricted cash and restricted cash equivalents
(554,991
)
633,222
Cash, cash equivalents, restricted cash
and restricted cash equivalents at beginning of period
1,323,428
690,206
Cash, cash equivalents, restricted cash
and restricted cash equivalents at end of period
$
768,437
$
1,323,428
Reconciliation to amounts on
consolidated balance sheets (as of period end)
Cash and cash equivalents
$
494,711
$
872,582
Restricted cash and restricted cash
equivalents
273,726
450,846
Total cash, cash equivalents, restricted
cash and restricted cash equivalents
$
768,437
$
1,323,428
SoFi Technologies,
Inc.
Consolidated Statements of
Cash Flows (Continued)
(In Thousands)
Year Ended December
31,
2021
2020
Supplemental cash flow
information
Interest paid
$
94,795
$
129,131
Income taxes paid, net
1,759
529
Supplemental non-cash investing and
financing activities
Securitization investments acquired via
loan transfers
$
118,274
$
151,768
Non-cash property, equipment, software and
intangible asset additions
1,930
358
Available-for-sale investments securities
purchased but unpaid
7,457
—
Share-based compensation capitalized
related to internally-developed software
7,776
—
Third party warrants acquired with
earnings initially deferred
964
—
Deferred debt issuance costs accrued but
unpaid
925
1,600
Costs directly attributable to the
issuance of common stock paid in 2020
588
—
Reduction to temporary equity associated
with purchase price adjustments
743
—
Conversion of temporary equity into
permanent equity in conjunction with the Business Combination
2,702,569
—
Deconsolidation of residual interests
classified as debt
—
101,718
Deconsolidation of securitization debt
—
770,918
Seller note issued in acquisition
—
243,998
Redeemable preferred stock issued in
acquisition
—
814,156
Common stock options assumed in
acquisition
—
32,197
Issuance of common stock in
acquisition
—
15,565
Finance lease right-of-use assets
acquired
—
15,100
Property, equipment and software acquired
in acquisition
—
2,026
Debt assumed in acquisition
—
5,832
Accrued but unpaid deferred equity
costs
—
56
Redeemed but unpaid common stock
—
526
Redeemed but unpaid redeemable preferred
stock
—
132,859
Table 5
Company Metrics
December 31, 2021
September 30, 2021
June 30, 2021
March 31, 2021
December 31, 2020
September 30, 2020
June 30, 2020
March 31, 2020
Members
3,460,298
2,937,379
2,560,492
2,281,092
1,850,871
1,500,576
1,204,475
1,086,409
Total Products
5,173,197
4,267,665
3,667,121
3,184,554
2,523,555
2,052,933
1,645,044
1,442,481
Total Products — Lending segment
1,078,952
1,030,882
981,440
945,227
917,645
892,934
861,970
841,615
Total Products — Financial Services
segment
4,094,245
3,236,783
2,685,681
2,239,327
1,605,910
1,159,999
783,074
600,866
Total Accounts — Technology Platform
segment(1)
99,660,657
88,811,022
78,902,156
69,572,680
59,735,210
49,276,594
35,988,090
—
___________________
(1)
Beginning in the fourth quarter of 2021,
the Company included SoFi accounts on the Galileo
platform-as-a-service in its total Technology Platform accounts
metric to better align with presentation of Technology Platform
segment revenue. The Company recast the total accounts as of
December 31, 2020 to conform to the current year presentation,
which resulted in an increase of 375,367 in total accounts as of
such date. Quarterly amounts for the relevant quarters in 2021 and
2020 were determined to be immaterial, and as such were not
recast.
Members
We refer to our customers as “members”. We define a member as
someone who has had a lending relationship with us through
origination and/or servicing, opened a financial services account,
linked an external account to our platform, or signed up for our
credit score monitoring service. Once someone becomes a member,
they are always considered a member unless they violate our terms
of service, given that our members have continuous access to our
certified financial planners, our career advice services, our
member events, our content, educational material, news, tools and
calculators at no cost to the member. We view members as an
indication not only of the size and a measurement of growth of our
business, but also as a measure of the significant value of the
data we have collected over time.
Products
Total products refers to the aggregate number of lending and
financial services products that our members have selected on our
platform since our inception through the reporting date, whether or
not the members are still registered for such products. In our
Lending segment, total products refers to the number of home loans,
personal loans and student loans that have been originated through
our platform through the reporting date, whether or not such loans
have been paid off. If a member has multiple loan products of the
same loan product type, such as two personal loans, that is counted
as a single product. However, if a member has multiple loan
products across loan product types, such as one personal loan and
one home loan, that is counted as two products. In our Financial
Services segment, total products refers to the number of SoFi Money
accounts, SoFi Invest accounts, SoFi Credit Card accounts
(including accounts with a zero dollar balance at the reporting
date), SoFi At Work accounts and SoFi Relay accounts (with either
credit score monitoring enabled or external linked accounts) that
have been opened through our platform through the reporting date.
Our SoFi Invest service is composed of three products: active
investing accounts, robo-advisory accounts and cryptocurrency
accounts. Our members can select any one or combination of the
three types of SoFi Invest products. If a member has multiple SoFi
Invest products of the same account type, such as two active
investing accounts, that is counted as a single product. However,
if a member has multiple SoFi Invest products across account types,
such as one active investing account and one robo-advisory account,
those separate account types are considered separate products.
Total products is a primary indicator of the size and reach of our
Lending and Financial Services segments. Management relies on total
products metrics to understand the effectiveness of our member
acquisition efforts and to gauge the propensity for members to use
more than one product.
Technology Platform Total Accounts
In our Technology Platform segment, total accounts refers to the
number of open accounts at Galileo as of the reporting date,
excluding SoFi accounts. We exclude SoFi accounts because revenue
generated by Galileo from the SoFi relationship is eliminated in
consolidation. No information is reported prior to our acquisition
of Galileo on May 14, 2020. Total accounts is a primary indicator
of the accounts dependent upon Galileo’s technology platform to use
virtual card products, virtual wallets, make peer-to-peer and
bank-to-bank transfers, receive early paychecks, separate savings
from spending balances, make debit transactions and rely upon
real-time authorizations, all of which result in technology
platform fees for the Technology Platform segment.
Table 6
Segment Financials
Quarter Ended
($ in thousands)
December 31, 2021
September 30, 2021
June 30,
2021
March 31,
2021
December 31,
2020
September 30, 2020
June 30,
2020
March 31,
2020
Lending
Total interest income
$
91,999
$
91,579
$
83,035
$
81,547
$
90,753
$
86,468
$
83,985
$
93,177
Total interest expense
(14,753
)
(19,322
)
(26,213
)
(29,770
)
(33,626
)
(34,246
)
(39,650
)
(47,516
)
Total noninterest income (loss)
136,518
138,034
109,469
96,200
91,865
109,890
51,549
28,217
Total net revenue
213,764
210,291
166,291
147,977
148,992
162,112
95,884
73,878
Adjusted net revenue(1)
208,032
215,475
172,232
168,037
159,520
178,084
117,182
81,755
Contribution profit (loss)
105,065
117,668
89,188
87,686
85,204
103,011
49,419
4,095
Technology Platform
Total interest income (expense)
$
—
$
39
$
(32
)
$
(36
)
$
(42
)
$
(47
)
$
(18
)
$
—
Total noninterest income
53,299
50,186
45,329
46,101
37,524
38,865
19,037
997
Total net revenue(2)
53,299
50,225
45,297
46,065
37,482
38,818
19,019
997
Contribution profit
20,008
15,741
13,013
15,685
16,806
23,986
12,100
997
Financial Services
Total interest income
$
2,523
$
1,651
$
893
$
540
$
378
$
365
$
316
$
1,737
Total interest expense
(738
)
(442
)
(351
)
(311
)
(290
)
(267
)
(233
)
(1,522
)
Total noninterest income
20,171
11,411
16,497
6,234
3,963
3,139
2,345
1,939
Total net revenue
21,956
12,620
17,039
6,463
4,051
3,237
2,428
2,154
Contribution loss(2)
(35,189
)
(39,465
)
(24,745
)
(35,519
)
(36,753
)
(37,467
)
(30,893
)
(26,983
)
Other(3)
Total interest income
$
261
$
371
$
180
$
441
$
942
$
1,284
$
1,764
$
2,368
Total interest expense
(2,715
)
(1,501
)
(1,500
)
(5,131
)
(19,292
)
(4,345
)
(3,417
)
(1,095
)
Total noninterest income (loss)
(957
)
—
3,967
169
(684
)
(319
)
(726
)
—
Total net revenue (loss)(2)
(3,411
)
(1,130
)
2,647
(4,521
)
(19,034
)
(3,380
)
(2,379
)
1,273
Consolidated
Total interest income
$
94,783
$
93,601
$
84,108
$
82,528
$
92,073
$
88,117
$
86,065
$
97,282
Total interest expense
(18,206
)
(21,226
)
(28,096
)
(35,248
)
(53,250
)
(38,905
)
(43,318
)
(50,133
)
Total noninterest income (loss)
209,031
199,631
175,262
148,704
132,668
151,575
72,205
31,153
Total net revenue
285,608
272,006
231,274
195,984
171,491
200,787
114,952
78,302
Adjusted net revenue(1)
279,876
277,190
237,215
216,044
182,019
216,759
136,250
86,179
Net income (loss)
(111,012
)
(30,047
)
(165,314
)
(177,564
)
(82,616
)
(42,878
)
7,808
(106,367
)
Adjusted EBITDA(1)
4,593
10,256
11,240
4,132
11,817
33,509
(23,750
)
(66,152
)
___________________
(1)
Adjusted net revenue and adjusted EBITDA
are non-GAAP financial measures. For additional information on
these measures and reconciliations to the most directly comparable
GAAP measures, see “Non-GAAP Financial Measures” and Table 2 to the
“Financial Tables” herein.
(2)
Technology Platform segment total net
revenue includes intercompany technology platform fees earned by
Galileo from SoFi, which is a Galileo client, of $1,863 and $686
for the years ended December 31, 2021 and 2020, respectively. The
prior year information was recast to conform to the current year
presentation and the intercompany amounts were reflected in the
fourth quarters of the respective years, as inter-quarter amounts
were determined to be immaterial. There is an equal and offsetting
expense reflected within the Financial Services segment
contribution loss representing the intercompany technology platform
fees incurred to Galileo. The intercompany revenue and expense are
eliminated in consolidation. The revenue is eliminated within
“Other” and the expense represents a reconciling item of segment
contribution profit (loss) to consolidated loss before income
taxes.
(3)
“Other” primarily includes total net
revenue associated with corporate functions and non-recurring gains
from non-securitization investing activities that are not directly
related to a reportable segment.
SOFI-F
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220301006130/en/
Investors: Andrea Prochniak SoFi Investor Relations
aprochniak@sofi.com
Media: Rachel Rosenzweig SoFi Media Relations
rrosenzweig@sofi.com
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