A couple of weeks ago, I recommended buying SoFi Technologies (SOFI +3.42%) stock in October. Although you never know how a stock will react to earnings, and SoFi specifically has a spotty history in terms of post-earnings stock movement, things have been improving at the digital bank fast enough that it's been pretty reliable for positive earnings news.
SoFi ended up reporting fantastic results for the third quarter last week, and SoFi stock jumped on the news. But even if you missed this short-term jump, it's not too late to buy the stock. Here's why.
Image source: SoFi.
Everyone wants a digital bank account
SoFi started as a student lending business, but it has expanded into a full financial services app that's completely online. As the world moves toward digital, SoFi has been well-positioned to capture market share, and it has.
It has added record numbers of new customers during the past three quarters, culminating in 905,000 new members in the 2025 third quarter. Its one-stop shop strategy of offering a full complement of services is leading to more products per customer, and 40% of new product sales came from existing members in the third quarter. It added 1.4 million total products in the quarter, a 36% increase over last year.
It's scaling up at a fast pace. Adjusted net revenue increased 38% year over year in the third quarter, an accelerated pace of growth despite the company getting bigger. More of its growth is coming from its financial services segment, comprising mostly fee-based services that are padding the top line and moving down to the bottom line. Fee-based revenue increased 50% over last year, and adjusted earnings per share (EPS) rose from $0.05 last year to $0.11 this year.
NASDAQ: SOFI
Key Data Points
New products are driving engagement
SoFi has recently rolled out a slew of new innovations, including options trading, international money transfers on a blockchain network, and cryptocurrency trading. Just last week, it introduced SoFi Pay, its global remittance product that sends low-cost international payments. Management has said there are more blockchain services coming.
Another service it launched is called Cash Coach, an artificial intelligence-driven analysis tool that helps users spot trends and optimize their financial management. It also works with external accounts, and it might suggest, for instance, that a member move a low-interest savings account to a higher-interest SoFi account without the member having to do the work of finding the best rates.
Management thinks this is just the beginning. "The opportunity before us is massive," Chief Executive Officer Anthony Noto said. "We're investing aggressively across the business and accelerating innovation in crypto, blockchain, and AI to help more members than ever before get their money right."
The idea is to cross-sell new products and keep users in the SoFi ecosystem, with an escalating positive, upward cycle where the company gets bigger as more users join and sign up for more products. It's focused on technology-based services that meet demand among its younger, digital-first demographic, people who are choosing SoFi because they want to bank digitally. These are the younger users who will drive growth for years.
Interest rates are going down
Lending is still SoFi's core segment, and as interest rates go down, this business is improving. Not only is that positive for the short term, but SoFi can develop this business under low-rate conditions so that it's stronger the next time there's rate pressure.
Lending revenue increased 25% over last year in the third quarter, with contribution profit up 9%. It originated a record $9.9 billion in loans, a 57% increase over last year, with healthy demand across its three categories of personal, home, and student loans.
Management raised its full-year outlook for revenue growth from 30% to 36% and for EPS growth from $0.31 to $0.37. These are bigger increases than the usual forecast raise, and that's something the market loves.
SoFi stock has a long runway
SoFi stock has nearly doubled this year, but if it can keep up its strategy and resonate with its younger clients, it should have many more years of growth ahead. You can still buy it today and benefit from years of solid stock gains.
