SoFi reports record quarter and stock drops nine percent

SoFi $SOFI reported adjusted revenue of $1.2 billion for the second quarter, with 40% year-over-year growth, record adjusted EBITDA of $358 million, and net income of $157 million. New loan volume jumped 69% to $14.8 billion, while clients increased by 1.1 million to 15.8 million. The company also raised its full-year revenue guidance to $4.75–$4.85 billion. The stock reacted by falling roughly nine percent to around $15.

The reason for the drop, in my view, is mainly what the company didn't raise. Only the revenue outlook was increased, by about $150 million compared to the previous $4.655 billion. Expected EBITDA remained at $1.6 billion, and adjusted earnings per share at 60 cents. So the entire revenue increase is absorbed in costs. On top of that, there was dilution; the average share count is up 14% year-over-year, so while net income rose 60%, reported earnings per share rose only 50%.

Still, I see the quarter as solid. I view dilution as a weakness, but for a growth company with an expanding balance sheet, I consider it expected. The average total assets are up 45% year-over-year, and such asset growth requires a corresponding capital base. It's worth noting that this dilution doesn't stem from this quarter. It arose from two stock issuances last year – in July 2025 at $20.85, and in December at $27.50 – both well above today's price and book value. This year, the share count has been practically flat.

What pleased me most, though, was the credit side. The annual charge-off rate for personal loans fell to 2.62% from 3.03% in the previous quarter, and the net interest margin moved up to 5.98%, a four-basis-point increase quarter-over-quarter. Those are the two things I like to watch most at a bank.

I have built my position in SoFi and I'm not adding on this drop.

Do you see today's drop as an opportunity?