SoFi Technologies (SOFI) Q3 2026 earnings review
SoFi raises its profit plan, while lending consumes bank capital
SoFi, the digital bank and financial app, is growing rapidly by holding more loans on its own balance sheet while its fee-based segments lag behind. Revenue excluding one-offs rose 44% from a year ago to $1.4 billion, and profit per share hit $0.18 as overhead costs grew much slower than lending revenue. Chief executive Anthony Noto raised the 2026 revenue outlook and introduced a 2027 plan for $6.4 billion in revenue and $0.90 in profit per share.
| Revenue, excluding one-offs | $1.37B +44% from a year ago |
|---|---|
| Ebitda margin, excluding one-offs | 34% 30% in the first half |
| Total loan originations | $16.9B +71% from a year ago |
| Full-year 2026 revenue outlook | Raised $240M 2027 plan set at $6.4B (+27%) |
⚖️ Verdict: 🟢 Bullish
The story got better because third-quarter operating leverage removed the doubt over second-half profit margins, and the new 2027 forecast puts earnings ahead of management's multi-year plan. One caution: the boom rests on balance-sheet lending, which consumed 1.8 percentage points of the bank's regulatory capital ratio in three months while revenue per Financial Services product fell 13% from a year ago to $90.
The question now is whether SoFi can sustain 27% revenue growth in 2027 without exhausting its excess bank capital or seeing credit losses catch up with its expanding loan book. Bulls point to the $745 million in annual deposit funding savings and rising margins, while bears point to the model's 5.1% personal loan default assumption and falling capital ratio. The fourth-quarter capital ratio and default assumptions will show which trend wins.
🐂 Bull Case
Operating Leverage Lifted the Second-Half Margin
Three months ago, SoFi's full-year profit plan required its second-half Ebitda margin (profit before interest on corporate debt, taxes, depreciation and share-based pay) to jump to about 36% from 30% in the first half. This quarter delivered that step-up, reaching 34.3%, while management raised the full-year Ebitda target by $60 million and set a 35% margin target for 2027.
- General and administrative overhead: 14.5% of revenue, down 5.1 percentage points from a year ago by our math
- Technology and product development: 14.3% of revenue, down 3.1 percentage points
- Sales and marketing: 32.1% of revenue, up 2.2 percentage points
The margin expanded because fixed overhead and product development costs grew much slower than the 44% revenue increase. That operating leverage paid for heavier marketing while still lifting profit per share to $0.18, up 50% from the second quarter.
What to watch: fourth-quarter Ebitda margin excluding one-offs, which the raised full-year outlook puts at 35.8% by our math. Hitting that mark would prove the 35% margin planned for 2027 is already the company's normal run rate.
Balance-Sheet Lending Drives Record Interest Income
SoFi's main growth engine is originating consumer loans and holding most of them on its bank balance sheet to earn interest, while funding them with customer deposits instead of dearer credit lines. Critics worry that holding so many loans exposes the digital bank to credit losses if the economy sours.
Total loan originations rose 71% from a year ago to a record $16.9 billion, including $12.6 billion in personal loans, $2.9 billion in student loans and $27 million from a new small-business lending line. Net interest income jumped 59% to $929.5 million as the net interest margin (the spread between what the bank earns on loans and pays on funding) widened to 6.14%.
The company also originated $3.8 billion of those loans for outside buyers through its Loan Platform Business, which charges upfront fees without keeping the credit risk, and packaged $460 million of platform loans into a bond deal at an 0.83 percentage point spread. Because customer deposits paid 1.45 percentage points less than warehouse credit lines, the bank saved an annualized $745 million in interest costs.
What to watch: fourth-quarter net interest margin and third-party Loan Platform Business fee revenue, which slipped 8% from a year ago to $151.2 million this quarter. If platform fees stall while balance-sheet loans keep surging, growth will rely even more heavily on the bank's own capital.
New 2027 Plan Beats Medium-Term Profit Targets
SoFi previously told investors to expect annual revenue growth of at least 30% and profit per share growth of 38% to 42% a year between 2025 and 2028. This quarter, management raised its 2026 revenue forecast by $240 million to $5.04 billion (up 40%) and issued its first full-year outlook for 2027.
The 2027 plan calls for $6.4 billion in revenue excluding one-offs, $2.24 billion in Ebitda and $0.90 in profit per share. By our math, that means profit per share will grow 48% next year on 27% revenue growth, putting the digital bank within reach of its 2028 earnings goal a year early.
What to watch: the formal 2027 quarterly breakdown when management reports fourth-quarter results early next year. Because SoFi has raised its 2026 revenue plan by $385 million since the start of the year, the initial 27% growth rate for 2027 may also prove conservative.
🐻 Bear Case
Financial Services Revenue Per Product Is Falling
Chief executive Anthony Noto said SoFi is "adding more members, who are using more products, and generating more revenue per product".Existing members opened 51% of the 2.2 million new products added this quarter, lifting total products 44% to 26.7 million.
In the Financial Services division, which holds 87% of all products, revenue per product actually fell 13% from a year ago to $90, down from $104 in the third quarter of 2025. Furthermore, the company changed how it counts products for a third straight quarter without restating prior years. It added two account types that "reflect our acquisition of Composer, through which members create and deploy systematic portfolio strategies in separate brokerage accounts", plus a new credit card balance-transfer loan.
Because splitting existing investing and card services into extra product lines inflates the denominator, product count is growing much faster than the 25% revenue growth in Financial Services. That means cross-selling is adding account labels faster than it adds revenue per account.
What to watch: annualized revenue per Financial Services product in the fourth quarter. A number stuck near $90 while product additions stay above two million would confirm that new non-lending products dilute average monetization.
Rising Rates and Default Models Cut Loan Marks
SoFi carries $52.5 billion of personal, student and home loans on its balance sheet at fair value, meaning it recalculates what those loans are worth every quarter based on market interest rates and expected defaults. In the highlights, the company said "credit performance remained strong and in line with expectations" as the annualized personal loan charge-off rate fell 0.34 percentage points from a year ago to 2.26%.
- Personal loan expected annual default rate: raised to 5.10% from 4.77% in the second quarter
- Student loan expected annual default rate: raised to 0.89% from 0.73% in the second quarter
- Benchmark interest rates: up 0.76 percentage points for personal loans and 0.90 points for student loans
- Cumulative fair-value premium on loans: fell by $628 million from last quarter to $1.40 billion
While current charge-offs look low because total loans grew so fast, the valuation model's higher default assumptions and rising benchmark interest rates cut the fair-value premium on the loan book from 4.6% of unpaid principal in June to 2.8% in September by our math. What to watch: the expected default rate input in the fourth-quarter fair-value table, where another rise above 5.10% would show credit pressure building inside newer loan cohorts.
Loan Growth Is Consuming the Capital Cushion
Management has long aimed to generate more than half of its revenue from capital-light fee businesses rather than balance-sheet lending, while keeping its regulatory capital ratio comfortably above its 10.5% required minimum. Because Lending revenue surged 66% this quarter while non-lending segments lagged, Financial Services and the Technology Platform fell to 44.2% of total revenue by our math, down from 57% at the end of 2025.
Holding those new loans pushed risk-weighted assets up by $7.6 billion in three months to $56.2 billion. As a result, the company's total risk-based capital ratio dropped 1.8 percentage points in the quarter to 17.0%, and is now down 5.9 points across the first nine months of 2026.
What to watch: the total risk-based capital ratio at year-end. Another drop of nearly two percentage points in the fourth quarter would bring the ratio into the mid-teens, testing whether the bank can fund 2027 loan growth without selling more shares.
Risks this quarter didn't answer
Four standing concerns received partial or no new evidence in the third-quarter earnings release.
- Technology Platform profit: revenue from businesses on the platform a year ago rose 18% excluding a departed client, but reported revenue fell 24% to $87.4 million and segment profit dropped 56%; the first clean comparison arrives in the first quarter of 2027.
- Crypto trading margins: gross crypto revenue reached $161.6 million, but transaction costs took $160.0 million, leaving just $1.6 million (a 1% cut); watch whether the stablecoin business adds higher-margin revenue in the annual filing.
- Federal student loan rules: student loan volume nearly doubled to $2.9 billion, but the release gave no update on how July 2026 federal Grad PLUS changes affected the pipeline; the quarterly filing will carry any updated risk language.
- Deposit funding mix: total deposits rose $5.8 billion, and the quarterly filing's deposit footnote will show how much of that came from higher-cost time and brokered deposits (time deposits averaged $7.1 billion this quarter, up from $1.2 billion a year ago).
👓 Other Themes
Management Set New 2030 Ambitions
Noto said SoFi has evolved "into an everything financial app with eight different businesses each generating over $100 million in annualized revenue". Looking to 2030, the company outlined a long-term goal of "reaching 100 million products and scaling five businesses to more than $1 billion in revenue", alongside five businesses above $500 million and five above $100 million.
💲 Other KPIs
Deposits grew by $5.8 billion, or 12.7%, from last quarter, stepping up from a $5.3 billion addition in the second quarter. Deposits funded 90% of average liabilities and cost 3.07% on average, saving 1.45 percentage points compared with warehouse credit lines.
Revenue from fees rather than interest rose 40% from a year ago and 21% from last quarter, making up 42% of total revenue. Loan origination fees jumped 158% to $270.9 million and card interchange fees climbed 77% to $49.7 million, offsetting a 40% drop in technology services fees.
Net asset value per share excluding goodwill and intangible assets rose 25% from $5.97 a year ago and $0.14 from the second quarter. Total tangible book value grew by $234.7 million in the quarter to $9.7 billion on retained earnings.
Average diluted shares rose 5.2% from a year ago and 0.4% from last quarter, slowing sharply from the 14.3% year-over-year increase in the second quarter as the bank lapped last year's stock offerings.
🔮 Guidance
Raised. Management lifted the middle of its full-year revenue plan by $240 million, pointing to 40% growth for 2026. By our math, that leaves $1.38 billion for the fourth quarter, or 35.9% growth from a year ago against 44.4% in the third quarter. It is the second raise this year and larger than the last: $0M, +$145M, +$240M.
Raised. The company increased its full-year Ebitda target by $60 million, equating to a 33% annual margin. By our math, the outlook leaves $492 million of Ebitda for the fourth quarter, which equals a 35.8% margin against 34.3% delivered in the third quarter.
Raised. SoFi lifted its full-year net profit outlook by $15 million, maintaining a 17% net margin target. By our math, that implies $270 million of net profit in the fourth quarter, up from $243 million in the third quarter.
Raised. The full-year profit per share plan moved up by 1 cent. With $0.43 earned across the first nine months, the outlook implies $0.18 in the fourth quarter by our math, matching the third quarter's record level.
Unchanged. Management kept its floor of at least 30% member growth for the year. Because total members already rose 35% from a year ago to 17.1 million after a record 1.26 million additions in the third quarter, the floor requires only 672,000 new members in the fourth quarter by our math.
New. Management introduced its 2027 revenue outlook at $6.4 billion, calling for 27% growth over the raised 2026 forecast. That rate sits slightly below the company's medium-term compound annual growth target of at least 30% because 2026 grew at 40%.
New. The initial 2027 Ebitda plan calls for 35% growth over the 2026 outlook by our math and an annual margin of 35%, up 2 percentage points from 2026.
New. The 2027 net profit forecast represents a 52% increase over the 2026 target by our math and lifts the full-year net profit margin to 20% from 17% in 2026.
New. Management expects $0.90 per share in 2027, up 48% from the 2026 forecast by our math and ahead of its 38% to 42% multi-year growth target.
❓ Key Questions
What was product growth without the counting changes?
SoFi expanded its Financial Services product definition three times in three quarters by splitting Invest into six products and adding SoFi Plus, Smart Card and credit card rollover loans without recasting prior years. Investors need the like-for-like product growth rate.
Why did expected default rates rise in the loan model?
While reported personal loan charge-offs fell to 2.26%, the fair-value model's weighted average annual default assumption rose from 4.77% to 5.10% for personal loans and from 0.73% to 0.89% for student loans. Management has not explained which cohorts drove that change.
How much revenue did SoFi Plus generate this quarter?
Paid SoFi Plus subscribers rose from 206,000 in June to 272,835 in September, a slower pace than needed to reach chief executive Anthony Noto's goal of one million subscribers by mid-2027. The release did not disclose subscription revenue.
How much of the deposit growth came from brokered certificates?
Average time deposits jumped to $7.1 billion from $1.2 billion a year ago. Because the earnings release does not break out brokered deposits from member certificates of deposit, investors must wait for the quarterly filing to check funding quality.