Is Now the Time to Buy SoFi Stock?
Is Now the Time to Buy SoFi Stock?
SoFi Technologies has grown into one of the most recognizable digital-first financial platforms in the U.S., offering a wide range of services that go far beyond traditional banking. Its ecosystem now includes estate planning tools, stock and crypto trading platforms, payment processing, and everyday banking products, all designed for a younger, mobile-first audience.
How SoFi Built a Digital Banking Powerhouse
Founded as a fintech disruptor, SoFi strengthened its infrastructure in 2020 by acquiring Galileo, a digital payment processing company that now powers financial services for many third-party clients. In 2022, SoFi took a major step forward by securing a U.S. bank charter, allowing it to operate as a fully licensed digital bank.
This digital-only model helped SoFi scale much faster than traditional banks with physical branches. Millennials and Gen Z users, in particular, were drawn to its all-in-one financial app and competitive product offerings.
By the end of the third quarter of 2025, SoFi reported:
- 12.6 million members
- 18.6 million financial products in use
That compares to just 2.5 million members and 1.9 million products at the end of 2021. Meanwhile, Galileo which operates independently, now supports nearly 160 million accounts, highlighting the scale of SoFi’s underlying technology business.
Strong Revenue and Profit Growth Despite Headwinds
Between 2021 and 2024, SoFi’s growth was striking:
- Adjusted revenue rose at a 37% compound annual growth rate (CAGR), climbing from $1.01 billion to $2.61 billion.
- Adjusted EBITDA surged at a 181% CAGR, growing from $30 million to $666 million.
This expansion happened even during difficult conditions, including the multi-year pause on U.S. student loan repayments and a higher interest rate environment that slowed overall loan demand.
Where SoFi Makes Its Money
Like most banks, SoFi earns a large share of its income from interest and fees on loans. It also sells and securitizes some loans to institutional investors to manage risk and free up capital.
Beyond lending, SoFi generates revenue from:
- Investment and brokerage fees
- Debit and credit card swipe fees
- Referral income from third-party financial products
- Subscription fees from SoFi Plus, its premium tier offering higher savings rates and loan discounts
This diversification is important as the company works to reduce reliance on interest income.
Near-Term Catalysts Investors Are Watching
Several developments could shape SoFi’s performance in the near future:
1. Expansion of Fee-Based Services
SoFi is pushing deeper into non-lending revenue streams. Its new AI-powered personal finance tools are designed to help users manage money more effectively while encouraging them to adopt additional SoFi products.
2. Growth of the Loan Platform Business (LPB)
Rather than issuing only its own loans, SoFi increasingly originates loans for third parties. This platform model is lower risk and generates more predictable, higher-margin fees, helping stabilize earnings.
3. Cryptocurrency Platform and Stablecoin Launch
SoFi recently expanded its crypto offerings to include access to 30 digital assets and introduced SoFiUSD, its own stablecoin. If lower interest rates fuel renewed enthusiasm for crypto markets, this segment could become a meaningful growth driver.
How Interest Rate Cuts Could Impact SoFi
The Federal Reserve has already cut interest rates multiple times in 2024 and 2025, with more reductions possible if inflation continues to ease.
Lower rates may reduce SoFi’s net interest income per loan, but they could also:
- Increase overall loan demand
- Support growth in crypto and investment activity
- Allow SoFi to refinance its own debt at lower costs
Notably, interest expenses consumed about one-third of SoFi’s revenue in the first nine months of 2025, so refinancing could materially improve profitability.
Should Investors Buy SoFi Stock Before the Next Earnings Report?
In its latest quarterly update, SoFi raised its full-year adjusted revenue growth guidance to 36%, up from 30%, and increased its adjusted EBITDA growth outlook to 55%. The company also expects to add 3.5 million new members, representing 34% growth year over year.
Wall Street analysts are even more bullish:
- 2025 revenue growth expected at 37%
- Adjusted EBITDA growth forecast at 56%
- From 2025 to 2027, analysts project revenue and EBITDA CAGRs of 22% and 39%, respectively
At an enterprise value of roughly $35.5 billion, SoFi trades at about 22 times forward adjusted EBITDA, which many investors view as reasonable for a high-growth fintech.
However, there are risks. The company recently issued $1.5 billion in new shares, diluting existing shareholders, and further dilution is possible as SoFi continues investing aggressively.
Final Takeaway
SoFi’s long-term outlook remains compelling, supported by strong member growth, expanding fee-based revenue, and improving profitability. That said, expectations are already high.
If SoFi fails to significantly beat guidance or set ambitious targets for 2026 in its next earnings report, the stock could pull back after its strong run. For cautious investors, waiting for that potential dip may offer a more attractive entry point into this fast-growing digital finance company.
Disclaimer
This article is for informational and educational purposes only and does not constitute financial, investment, or trading advice. Stock market investments involve risk, including the possible loss of capital. Always conduct your own research or consult a qualified financial advisor before making investment decisions.
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