Pagaya Technologies Ltd - Class A
Q3 2025 Earnings
Market Reaction
S&P 500 over the same 30 days: +1.13%.
Did PGY Beat Earnings? Q3 2025 Results
Pagaya Technologies posted a decisive beat in Q3 2025, reporting earnings per share of $1.02 against a consensus estimate of $0.66, a 54.55% positive surprise, as revenue climbed 40.5% year over year to $350.17 million. The headline driver was a broad acceleration across the company's AI-driven lending network, where network volume grew 19% to $2.80 billion and the Auto and Point-of-Sale verticals collectively expanded to 32% of total volume, up from just 9% a year ago. Profitability turned sharply positive as well, with GAAP net income attributable to shareholders reaching $22.55 million compared to a loss of $67.48 million in the year-ago period, reflecting lower operating expenses and a $20.00 million one-time tax benefit. Capital markets activity added further momentum, as Pagaya raised $500.00 million in senior unsecured debt, cutting its cost of capital by roughly 2 percentage points. Management raised full-year 2025 guidance for the third consecutive quarter, now targeting revenue between $1.30 billion and $1.33 billion and adjusted EBITDA of $372.00 million to $382.00 million.
- 19% YoY network volume growth driven by Auto and Point-of-Sale verticals
- Personal loan business grew 31% YoY and remained largest contributor at ~64% of network volume
- FRLPC % expanded 70bps YoY to 5.0% due to partner and funding mix improvements
- Core operating expenses as % of FRLPC fell to 34%, a 19-point YoY improvement demonstrating operating leverage
- Revenue from fees grew 36% YoY and represented 97% of total revenue
- Lending product fees made up 78% of total FRLPC vs 71% in Q3 2024
- Approximately 50% of current volumes come from newer products and features beyond Decline Monetization
“Our results demonstrate another quarter of prudent underwriting and consistent execution across our network as we raise full-year guidance for the third consecutive quarter. Our pipeline has never been stronger as lenders across asset classes recognize the unique and powerful value proposition the Pagaya network provides. With our partners, we are committed to bridging Main Street and Wall Street for the long run.”
Pagaya Technologies CEO, on the earnings call
Forward Guidance & Outlook
Pagaya raised its full-year 2025 guidance for the third consecutive quarter. FY25 network volume is expected between $10.5 billion and $10.75 billion. FY25 total revenue and other income is expected between $1,300 million and $1,325 million. FY25 adjusted EBITDA is expected between $372 million and $382 million. FY25 GAAP net income is expected between $72 million and $82 million. Implied Q4 2025 outlook: network volume of $2.65 billion to $2.9 billion, total revenue of $333 million to $358 million, adjusted EBITDA of $99 million to $109 million, and GAAP net income of $25 million to $35 million. FRLPC as a % of network volume is expected to decrease from the upper end of the 4.0%-5.0% range over coming quarters, reflecting continued expansion of POS and Auto and a diversified funding mix. Interest expense is projected to trend lower as a result of the recent refinancing. The company maintains a cautious stance given protracted macro volatility and assumes $100-$150 million in rolling 12-month forward credit-related impairments.
PGY YoY Financials
Figures from SEC filings and company reports. Not investment advice.