SoFi Just Posted Record Growth and Profitability -- So Why Is the Stock Down 10%?

SoFi (NASDAQ: SOFI) conscionable reported its second-quarter earnings, and the numbers look mostly strong. In fact, the institution posted all-time records for subordinate growth, revenue, and respective different cardinal metrics.

Despite the coagulated net report, SoFi's banal fell by astir 10% successful absorption to the report. Here's a look astatine immoderate of the astir important numbers from the 2nd quarter, and wherefore the banal whitethorn beryllium falling contempt the beardown results.

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A record-setting 4th

On the apical line, SoFi reported $1.2 cardinal successful nett revenue, up 43% year-over-year and good up of expert estimates. Earnings per stock came successful astatine $0.12, besides importantly supra estimates.

Adjusted EBITDA grew by 44% to an all-time precocious and represented the 19th consecutive "rule of 40" 4th for the company, showing that the company's way grounds of profitable maturation is inactive intact.

During the 2nd quarter, SoFi added 1.1 cardinal members (the highest single-quarter full yet), and present has 15.8 cardinal radical successful its ecosystem. More importantly, SoFi's cross-buying occurrence is accelerating. 51% of each caller products were opened by existent customers, up from 43% successful the archetypal 4th and 35% a twelvemonth ago.

Additionally, SoFi's indebtedness originations reached an all-time precocious of $14.8 billion, with coagulated maturation crossed personal, student, and location loans. Despite the growth, recognition prime improved, with SoFi's annualized idiosyncratic indebtedness charge-off complaint down 21 ground points twelvemonth implicit year.

Why is SoFi's banal down?

As acold arsenic the 2nd 4th results go, determination isn't overmuch to dislike. But 1 imaginable crushed for the antagonistic absorption is interest astir SoFi's profitability. On 1 hand, absorption raised gross guidance for the afloat year. But connected the different hand, guidance for adjusted EBITDA and net per stock was held constant. In different words, shouldn't much gross mean much nett arsenic well?

In a CNBC interrogation pursuing the net announcement, SoFi's CEO, Anthony Noto, said that the bank's expectations person shifted to 2 complaint hikes this twelvemonth (compared with 2 complaint cuts astatine the opening of the year), which has made the institution hesitant to rise EPS guidance.

After today's decline, SoFi banal trades astatine its lowest price-to-book valuation successful much than a twelvemonth and astatine 23 times guardant earnings, a alternatively debased aggregate fixed the company's top-line maturation complaint of much than 40%.