SoFi Reports First Quarter 2025 with Record Net Revenue of $772 Million, Record Member and Product Growth, Net Income of $71 Million

Adjusted Net Revenue up 33% year-over-year to a record $771 million

Adjusted EBITDA up 46% to a record $210 million

Fee-based Revenue up 67% to a record $315 million

Member growth up 34% to a record 10.9 million members

Product growth up 35% to a record 15.9 million products

Management Raises 2025 Guidance

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 first quarter ended March 31, 2025.

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Note: For additional information on our company metrics, including the definitions of "Members", "Total Products" and "Technology Platform Total Accounts", see Table 6 in the “Financial Tables” herein. Beginning in the first quarter of 2024, new member and new product addition metrics for the relevant period reflect actual growth or declines in members and products that occurred in that period whereas the total number of members and products reflects not only the growth or decline of each metric in the current period but also additions or deletions due to prior period factors, if any. (1) The company includes SoFi accounts on the Galileo platform-as-a-service in its total Technology Platform accounts metric to better align with the presentation of Technology Platform segment revenue.

“We are off to a tremendous start in 2025. In Q1, we delivered durable growth and strong returns driven by our relentless focus on product innovation and brand building,” said Anthony Noto, CEO of SoFi. “We delivered our highest revenue growth rate in five quarters, driven by new records in members, products, and fee-based revenue. These results demonstrate the strength of SoFi's unique strategy, combination of businesses, and product architecture, which give us a sustainable competitive advantage with the highest lifetime value per member. This allows us to innovate unmatched products and services that help members spend less than they make and invest the rest so they can get their money right and realize their ambitions. With strong momentum in the first quarter, we are both accelerating our rate of innovation and increasing our financial guidance for 2025.”

Consolidated Results Summary

Product Highlights

• Set new records in members and products. A record 800,000 new members joined SoFi in the quarter, up 34% to 10.9 million. The company recorded 1.2 million new products, up 35% from the prior year to 15.9 million products.

• Doubled revenue in Financial Services through rapid innovation. SoFi’s fastest growing segment reached $303 million in revenue, driven by strong adoption of SoFi Money, rapid expansion of the Loan Platform Business, and innovations in SoFi Invest including improved user experience and an expanded partnership with Templum, unlocking access to a broader range of investment opportunities.

• Expanded the Loan Platform Business with over $8 billion in new commitments. With strong demand for SoFi’s personal loans, the company has finalized deals with Blue Owl, Fortress, and Edge Focus so far in 2025, and originated $1.6 billion in loans on behalf of third parties in Q1 alone.

• Accelerated loan originations and continued to expand products. Including the Loan Platform Business, SoFi originated a record $7.2 billion in loans in the quarter. With stronger technology and fulfillment capabilities and a new home equity offering launched within the past year, SoFi grew home loan originations by 54% from the first quarter of 2024. A planned personal loan product for prime credit card customers with revolving balances and a new SmartStart student loan refinancing product will give members more ways to get their money right.

• Further improved credit performance. SoFi’s annualized charge-off rate decreased from 3.37% to 3.31% for personal loans and from 62 basis points to 47 basis points for student loans compared to the fourth quarter of 2024. The on-balance sheet 90-day delinquency rate for personal loans decreased for the fourth consecutive quarter.

• Strengthened brand awareness to attract more members to SoFi’s ecosystem. With continued investment to build SoFi into a trusted household name, strong unaided brand awareness continued through the quarter at 7%. The company completed the inaugural season of TGL presented by SoFi, a new tech-driven stadium golf league that attracted over 20 million total viewers, and announced a new partnership with the Country Music Association’s CMA Fest.

• Launched new, fee-based subscription option for SoFi Plus. Nearly 90% of new SoFi Plus subscribers were existing members, demonstrating the value of making this product more accessible. Of these members, nearly 30% adopt an additional product within 30 days of enrollment. Among SoFi Plus subscribers who are completely new to SoFi, over 75% adopt at least a second product, and over 40% adopt a third product within 30 days of enrollment.

Consolidated Results

SoFi reported a number of key financial achievements. For the first quarter of 2025, GAAP net revenue of $771.8 million increased 20% relative to the prior-year period's $645.0 million. Record adjusted net revenue of $770.7 million grew 33% from the corresponding prior-year period of $580.6 million.

For the first quarter of 2025, total fee-based revenue reached a record of $315.4 million, a year-over-year increase of 67%. This was driven by strong performance from our Loan Platform Business, as well as origination fee revenue, referral fee revenue, interchange fee revenue and brokerage fee revenue. Together, the Financial Services and Technology Platform segments generated $406.5 million of net revenue, an increase of 66% from the prior year period.

SoFi reported its sixth consecutive quarter of GAAP profitability. For the first quarter of 2025, GAAP net income reached $71.1 million and diluted earnings per share reached $0.06.

First quarter record adjusted EBITDA of $210.3 million increased 46% from the prior year period's $144.4 million. This represents an adjusted EBITDA margin of 27%. All three segments delivered strong contribution profit, at attractive margins.

Equity grew by $153.4 million during the quarter, ending at $6.7 billion and $6.05 of book value per share. Tangible book value grew by $167.1 million during the quarter, ending the period at $5.1 billion. Tangible book value per share was $4.58 at quarter-end, up from $3.90 per share in the prior year period.

Net interest income of $498.7 million for the first quarter was up 24% year-over-year. This was driven by a 23% increase in average interest-earning assets and a 82 basis points decrease in cost of funds, partially offset by a 55 basis points decrease in average asset yields year-over-year.

For the first quarter, net interest margin of 6.01% increased 10 basis points sequentially from 5.91%, primarily due to lower cost of funds. The average rate on deposits was 189 basis points lower than that of warehouse facilities, which translates to approximately $515 million of annual interest expense savings.

Member and Product Growth

Continued growth in both total members and products in the first quarter is the result of our continued investments in innovation and brand building and reflects the benefits of our broad product suite and unique Financial Services Productivity Loop (FSPL) strategy.

Added a record 800,000 members in the first quarter of 2025, bringing total members over 10.9 million, up 34% from 8.1 million at the same prior year period.

Record product additions of 1.2 million in the first quarter of 2025, bringing total products to over 15.9 million, up 35% from 11.8 million at the same prior year period.

Financial Services products increased by 36% year-over-year to 13.8 million, primarily driven by continued demand for our SoFi Money, Relay and Invest products, and drove 90% of our total product growth. SoFi Money and SoFi Relay grew to 5.5 million and 5.1 million products, respectively, both representing 41% year-over-year growth. One third of Relay-first members that adopt a second product go on to adopt at least one more product.

Lending products increased by 25% year-over-year to 2.1 million products, driven primarily by continued demand for personal, student and home loan products.

Technology Platform enabled accounts increased by 5% year-over-year to 158 million.

Financial Services Segment Results

For the first quarter of 2025, Financial Services segment net revenue of $303.1 million more than doubled from the prior year period. Net interest income of $173.2 million increased 45% year-over-year, primarily driven by growth in consumer deposits. Noninterest income of $129.9 million more than quadrupled year-over-year, and now represents nearly $520 million in annualized revenue.

In the first quarter, SoFi's Loan Platform Business added $96.1 million to our consolidated adjusted net revenue. Of this $92.8 million was driven by $1.6 billion of personal loans originated on behalf of third parties as well as referrals to third parties. Additionally, our Loan Platform Business generated $3.3 million in servicing cash flow which is recorded in our Lending segment.

In addition to our Loan Platform Business, SoFi continued to see healthy growth in interchange fee revenue in the first quarter, up 90% year-over-year, respectively, as a result of nearly $16 billion in total annualized spend in the quarter across Money and Credit Card.

Contribution profit for the first quarter of 2025 reached $148.3 million, a $111.2 million improvement from the prior year period, while contribution margin grew 24 percentage points year-over-year to 49%. This is a reflection of the strong operating leverage generated in the segment, with directly attributable expenses increasing only 40%.

By continuously innovating with new and relevant offerings, features and rewards for members, SoFi grew total Financial Services products by 3.7 million, or 36%, year-over-year, bringing the total to 13.8 million at quarter-end. SoFi Money reached 5.5 million products, Relay reached 5.1 million products and SoFi Invest reached 2.7 million products by the end of the first quarter.

Monetization continues to improve with annualized revenue per product of $88 during the first quarter, up 48% year-over-year.

In the first quarter of 2025, total deposits grew to $27.3 billion, with over 90% of SoFi Money deposits (inclusive of Checking and Savings and cash management accounts) coming from direct deposit members.

Technology Platform Segment Results

Technology Platform segment net revenue of $103.4 million for the first quarter of 2025 increased 10% year-over-year. Contribution profit of $30.9 million reflected contribution margin of 30%.

SoFi continues to diversify its Technology Platform client base beyond financial services companies. During the quarter, SoFi launched a first-of-its-kind co-branded debit card program with Wyndham Hotels & Resorts. The investment made in building this new capability will help the business win additional consumer-brand clients. SoFi also recently signed a deal with Mercantil Banco, which offers personal and business banking services in Panama and will use our Cyberbank Digital banking platform.

Technology Platform total enabled client accounts increased 5% year-over-year, to 158.4 million up from 151.0 million in the prior-year period.

Lending Segment Results

For the first quarter of 2025, Lending segment GAAP net revenue of $413.4 million increased 25% from the prior year period, while adjusted net revenue for the segment of $412.3 million increased 27% from the prior year period.

Lending segment performance in the first quarter was driven by net interest income, which rose 35% year-over-year, primarily driven by growth in average loan balances of 22%.

Lending segment first quarter contribution profit of $238.9 million was up 15% from $207.7 million in the corresponding prior-year period. Lending segment adjusted contribution margin was strong at 58%. This strong margin reflects our ability to capitalize on continued strong demand for our lending products.

The following table summarizes the significant inputs to the fair value model for personal and student loans:

For the first quarter of 2025, record origination volume of $7.2 billion increased 66% year-over-year. This was a result of continued strong member demand for personal loans, student loans and home loans as well as strong demand from capital markets partners.

Personal loan record originations of $5.5 billion in the first quarter of 2025 were up 69% year-over-year, inclusive of $1.6 billion originated on behalf of third parties for our Loan Platform Business. First quarter student loan volume of $1.2 billion was up 59% year-over-year. Home equity loan originations were a record during the first quarter, accounting for more than one-third of total home loan volume. In total, home loan volume was $518 million, an increase of 54% year-over-year.

Capital markets activity in the first quarter of 2025 was very strong. Overall, SoFi sold, or transferred through our Loan Platform Business, more than $3.1 billion in total of personal loans and home loans. In terms of personal loans, we closed $1.1 billion of sales in whole loan form at a blended execution of 106.2%. In terms of home loan sales, we closed $322 million at a blended execution of 102.1%.

In addition to our personal and home loan sales, SoFi executed a $698 million co-contributor securitization of loans previously originated through our Loan Platform Business. This was the first securitization of new collateral in our SoFi Consumer Loan Program (SCLP) since 2021 and the first using collateral originated in the Loan Platform Business. Importantly, this channel provides our partners with meaningful liquidity to support their ongoing investment in the Loan Platform Business. The transaction priced at industry-leading cost-of-funds levels, with a weighted average spread of 87 basis points and an all-in yield of 5.10%.

Credit performance further strengthened in the first quarter. The on-balance sheet 90 day delinquency rate for personal loans decreased from 55 basis points to 46 basis points, while the on-balance sheet 90 day delinquency rate for student loans was 13 basis points, in line with the prior quarter.

Personal loan annualized charge-off rate decreased to 3.31% from 3.37% in the prior quarter, including the impact of asset sales, new originations and the delinquency sales in the quarter. Had SoFi not sold these late stage delinquent loans, it is estimated that, including recoveries, they would have had an all-in annualized net charge-off rate for personal loans of approximately 4.8% vs. 4.9% in the prior quarter.

The data continues to support a 7–8% maximum life of loan loss assumption for personal loans, in line with SoFi's underwriting tolerance.

Recent vintages, originated from the fourth quarter of 2022 to the second quarter of 2024 have net cumulative losses of 4.09%, with 43% unpaid principal balance remaining. This is well below the 5.53% observed at the same point in time for the 2017 vintage which is the last vintage that approached our 7-8% tolerance. The gap between the newer cohort curve and the 2017 cohort curve improved by 16 basis points, after improving 15 basis points in the fourth quarter of 2024, demonstrating continued improvement.

Additionally, of the first quarter of 2020 through the fourth quarter of 2024 originations, 59% of principal has already been paid down, with 6.7% in net cumulative losses. Therefore, for life-of-loan losses on this entire cohort of loans to reach 8%, the charge-off rate on the remaining 41% of unpaid principal would need to be approximately 10%. This would be well above past levels, providing further confidence in achieving loss rates below our 8% tolerance.

Guidance and Outlook

Given the strong start to the year, management is increasing its 2025 guidance.

For the full year 2025, management now expects to deliver adjusted net revenue of $3.235 to $3.310 billion, which is $35 million higher than the prior guidance range of $3.200 to $3.275 billion. This implies 24% to 27% annual growth versus 23% to 26% in our prior guidance. Management expects adjusted EBITDA of $875 to $895 million, above prior guidance of $845 to $865 million. This represents an incremental EBITDA margin of 27%, consistent with our long term investment philosophy. SoFi expects GAAP net income of $320 to $330 million, above prior guidance of $285 to $305 million, representing an incremental margin of 9% when excluding 2024 non-recurring income tax benefits and gains on convertible notes. Lastly, SoFi expects GAAP EPS of $0.27 to $0.28 cents per share, above prior guidance of $0.25 to $0.27 cents per share. This guidance assumes a tax rate of 26% for the remainder of the year.

Management expects growth in tangible book value of approximately $585 to $600 million.

Management expects to add at least 2.8 million new members in 2025, which represents 28% growth from 2024 levels.

In the second quarter of 2025, management expects to generate $785 to $805 million of adjusted net revenue, $200 to $210 million of adjusted EBITDA, $60 to $70 million of GAAP net income and $0.05 to $0.06 of GAAP EPS.

Management will further address full-year guidance on the quarterly earnings conference call. Management has not reconciled forward-looking non-GAAP measures to their most directly comparable GAAP measures. This is because the company cannot predict with reasonable certainty and without unreasonable efforts the ultimate outcome of certain GAAP components of such reconciliations due to market-related assumptions that are not within our control as well as certain legal or advisory costs, tax costs or other costs that may arise. For these reasons, management is unable to assess the probable significance of the unavailable information, which could materially impact the amount of the future directly comparable GAAP measures.

Earnings Webcast

SoFi’s executive management team will host a live audio webcast beginning at 8:00 a.m. Eastern Time (5:00 a.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 our expectations for second quarter of 2025 and full year 2025 adjusted net revenue, annual growth rate, adjusted EBITDA, adjusted EBITDA margin, GAAP net income, GAAP net income incremental margin, GAAP EPS, tangible book value, and new members, our expectations regarding our ability to continue to grow our business, build our brand and launch new business lines and products, our ability to continue to attract and execute deals, our ability to continue to improve our financials and increase our member, product and total accounts count, our ability to achieve diversified and more durable growth, including our ability to continue to grow our Loan Platform Business, our ability to continue the momentum seen in prior financial periods, our ability to have loss rates below 8%, our ability to navigate the macroeconomic, geopolitical and regulatory environment, any changes in demand for our products, and the financial position, business strategy and 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 “achieve”, “believe”, “continue”, “expect”, “capable” “future”, “growth”, “may”, “opportunity”, “plan”, “potential”, “strategy”, “will be”, “will continue”, 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 our ability to respond and adapt to changing market and economic conditions, including economic downturns, fluctuating inflation and interest rates, and volatility from macroeconomic, global, and political events, including announced or planned tariffs; (ii) our ability to maintain net income profitability, continue to increase fee-based revenue streams, continue to grow across our segments in the future, as well as our ability to meet our guidance; (iii) the impact on our business of the regulatory environment, changes in governmental policies, changes in personnel and resources of the governmental agencies that regulate us, and complexities with compliance related to such environment; (iv) our ability to realize the benefits of being a bank holding company and operating SoFi Bank, including continuing to grow high quality deposits and our rewards program for members; (v) our ability to continue to drive brand awareness and realize the benefits of our marketing and advertising campaigns; (vi) our ability to vertically integrate our businesses and accelerate the pace of innovation of our financial products; (vii) our ability to manage our growth effectively and our expectations regarding the development and expansion of our business; (viii) our ability to access sources of capital on acceptable terms or at all; (ix) the success of our continued investments in our business; (x) our ability to expand our member base and increase our product adds; (xi) 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; (xii) our ability to cater to a broad range of clients and continue to execute deals with current or future business partners; (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 ability to maintain the security and reliability of our products; and (xviii) the outcome of any legal or governmental proceedings 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 annual report on Form 10-K, 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. 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 certain non-GAAP financial measures provided as supplements to the results provided in accordance with accounting principles generally accepted in the United States (GAAP). Our management and Board of Directors uses these non-GAAP measures 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 these non-GAAP measures provide useful information to investors and others in understanding and evaluating our operating results in the same manner as our management and Board of Directors. These non-GAAP measures 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. 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.

About SoFi

SoFi Technologies (NASDAQ: SOFI) is a one-stop shop for digital financial services on a mission to help people achieve financial independence to realize their ambitions. Over 10.9 million members trust SoFi to borrow, save, spend, invest, and protect their money – all in one app – and get access to financial planners, exclusive experiences, and a thriving community. Fintechs, financial institutions, and brands use SoFi’s technology platform Galileo to build and manage innovative financial solutions across 158.4 million global accounts. For more information, visit 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 (https://www.sofi.com), the investor relations website (https://investors.sofi.com), and on social media (X 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.

SOFI-F

FINANCIAL TABLES

(Unaudited)

1. Condensed Consolidated Statements of Operations and Comprehensive Income

2. Reconciliation of GAAP to Non-GAAP Financial Measures

3. Condensed Consolidated Balance Sheets

4. Average Balances and Net Interest Earnings Analysis

5. Company Metrics

6. Segment Financials

7. Disaggregated Revenue

8. Analysis of Charge-Offs

9. Regulatory Capital

Table 2

Non-GAAP Financial Measures

(Unaudited)

Adjusted Net Revenue

Adjusted net revenue is a non-GAAP measure. 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, as well as gains and losses on extinguishment of debt. We adjust total net revenue to exclude these items, as they are non-cash charges that are not realized during the period or not indicative of our core operating performance, and therefore positive or negative changes do not impact the cash available to fund our operations. Management believes this measure is useful because it enables management and investors to assess our underlying operating performance and cash available to fund our operations. In addition, management uses this measure to better decide on the proper expenses to authorize for each of our operating segments, to ultimately help achieve target contribution profit margins.

The following table reconciles adjusted net revenue to total net revenue, the most directly comparable GAAP measure:

The following table reconciles adjusted net revenue for the Lending segment to total net revenue, the most directly comparable GAAP measure for the Lending segment:

Adjusted Noninterest Income

Adjusted noninterest income is a non-GAAP measure. Adjusted noninterest income is defined as noninterest income, 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, as well as gains and losses on extinguishment of debt. We adjust noninterest income to exclude these items, as they are non-cash charges that are not realized during the period or not indicative of our core operating performance, and therefore positive or negative changes do not impact the cash available to fund our operations. Management believes this measure is useful because it enables management and investors to assess our underlying operating performance and cash available to fund our operations.

The following table reconciles adjusted noninterest income to noninterest income, the most directly comparable GAAP measure:

The following table reconciles adjusted noninterest income for the Lending segment to noninterest income, the most directly comparable GAAP measure for the Lending segment:

Adjusted Contribution Margin and Incremental Adjusted Contribution Margin — Lending

Adjusted contribution margin and incremental adjusted contribution margin are non-GAAP measures and relate only to our Lending segment. Adjusted contribution margin is defined as segment contribution profit for the Lending segment, divided by adjusted net revenue for the Lending segment, a non-GAAP measure. Incremental adjusted contribution margin is defined as the change in segment contribution profit for our Lending segment, divided by change in adjusted net revenue for the Lending segment. See ‘Adjusted Net Revenue’ above for a reconciliation of Lending segment adjusted net revenue.

Management believes adjusted contribution margin metrics are useful because they enable management and investors to assess the underlying operating performance of our Lending segment, by removing the impact of changes in volume over periods to present a comparable view of segment contribution profit, which is a measure of the direct profitability of each of our reportable segments, as a percentage of segment adjusted net revenue for the Lending segment during each period.

The following table presents a reconciliation of adjusted contribution margin and incremental adjusted contribution margin for our reportable Lending segment:

Adjusted EBITDA, Adjusted EBITDA Margin and Incremental Adjusted EBITDA Margin

Adjusted EBITDA, adjusted EBITDA margin and incremental adjusted EBITDA margin are non-GAAP measures. Adjusted EBITDA is defined as net income, adjusted to exclude, as applicable: (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 these are direct operating expenses), (ii) income tax expense (benefit), (iii) depreciation and amortization, (iv) share-based expense (inclusive of equity-based payments to non-employees), (v) restructuring charges, (vi) impairment expense (inclusive of goodwill impairment and property, equipment and software abandonments), (vii) transaction-related expenses, (viii) foreign currency impacts related to operations in highly inflationary countries, (ix) fair value changes in each of servicing rights and residual interests classified as debt due to valuation assumptions, (x) gain on extinguishment of debt, and (xi) other charges, as appropriate, that are not expected to recur and are not indicative of our core operating performance.

Adjusted EBITDA margin is computed as adjusted EBITDA divided by adjusted net revenue. Incremental adjusted EBITDA margin is defined as the change in adjusted EBITDA, divided by change in adjusted net revenue. See ‘Adjusted Net Revenue’ above for a reconciliation of this non-GAAP measure.

Management believes adjusted EBITDA, adjusted EBITDA margin and incremental adjusted EBITDA margin are useful measures for period-over-period comparisons of our business. These measures enable management and investors to assess our core operating performance or results of operations by removing the effects of certain non-cash items and charges, as well as the impact of changes in volume over periods as applicable. In addition, management uses these measures to help evaluate cash flows generated from operations and the extent of additional capital, if any, required to invest in strategic initiatives.

The following table reconciles adjusted EBITDA to net income, the most directly comparable GAAP measure, and presents the computations of adjusted EBITDA margin and incremental adjusted EBITDA margin:

Tangible Book Value and Tangible Book Value per Common Share

Beginning in the fourth quarter of 2024, the Company modified the presentation of its tangible book value and tangible book value per share, which are non-GAAP measures. Tangible book value is defined as permanent equity, adjusted to exclude goodwill and intangible assets, net of related deferred tax liabilities. Tangible book value per common share represents tangible book value at period-end divided by common stock outstanding at period-end. Prior periods were revised to conform with this presentation.

These measures are utilized by management in assessing our use of equity and capital adequacy. We believe that tangible book value presents a meaningful measure of net asset value, and tangible book value per share provides additional useful information to investors to assess capital adequacy.

The following table reconciles tangible book value to permanent equity, the most directly comparable GAAP measure, and presents the computation of permanent equity per common share and tangible book value per common share for the periods presented:

Adjusted Net Income, Adjusted Net Income Margin, Incremental Adjusted Net Income Margin and Adjusted EPS

Adjusted net income, adjusted net income margin, incremental adjusted net income margin and adjusted diluted earnings per share are non-GAAP measures. Adjusted net income is defined as net income, adjusted to exclude, as applicable, goodwill impairment expense and certain income tax benefits that are not expected to recur and are not indicative of our core operating performance.

Adjusted diluted earnings per share (“adjusted EPS”) is a non-GAAP financial measure that adjusts GAAP diluted earnings per share. Adjusted EPS is computed by dividing net income attributable to common stockholders, adjusted to exclude, as applicable, goodwill impairment expense and certain income tax benefits that are not expected to recur and are not indicative of our core operating performance, by the diluted weighted average number of shares of common stock outstanding during the period, excluding the dilutive impact of the 2029 convertible notes under the if-converted method for which the 2029 capped call transactions would deliver shares to offset dilution.

Adjusted net income margin is computed as adjusted net income divided by adjusted net revenue. Incremental adjusted net income margin is defined as the change in adjusted net income, divided by change in adjusted net revenue. See ‘Adjusted Net Revenue’ above for a reconciliation of this non-GAAP measure.

Management believes adjusted net income, adjusted net income margin, incremental adjusted net income margin and adjusted EPS are useful because they enable management and investors to assess our core operating performance or results of operations, by removing the effects of certain non cash items and charges to present a comparable view for period over period comparisons of our business.

The following table: (i) reconciles adjusted net income to net income, the most directly comparable GAAP measure, (ii) reconciles adjusted EPS to diluted earnings per share, the most directly comparable GAAP measure, and (iii) presents the computations of adjusted net income margin and incremental adjusted net income margin.