Pagaya Technologies 2025 Q2 Earnings Strong Performance as Net Income Surges 120%

Pagaya Technologies (PGY) reported its fiscal 2025 Q2 earnings on Aug 07th, 2025. The results exceeded expectations with a return to profitability and a significant revenue increase. The company raised its full-year guidance, reflecting improved business performance and strong operational momentum.

Pagaya Technologies reported a 31.0% year-over-year increase in total revenue, reaching $317.71 million in Q2 2025. This growth was supported by a diverse revenue stream, including $317.71 million from fees, $8.68 million in other income, and $10.74 million in interest income. The company also recorded a net investment loss of $2.06 million, while total revenue and other income amounted to $326.40 million. This robust revenue growth highlights the effectiveness of Pagaya’s AI-driven underwriting and expanded partner network.

The company returned to profitability, reporting a net income of $16.56 million in Q2 2025, a 120.0% positive swing from a net loss of $82.68 million in Q2 2024. Earnings per share (EPS) improved to $0.20, reversing from a loss of $1.04 per share the prior year. This remarkable turnaround underscores the strength of Pagaya’s business model and its ability to drive profitability.

Following the earnings report, the stock price of Pagaya Technologies declined 14.94% during the latest trading day. However, the stock has shown resilience with a 1.90% gain during the most recent full trading week and a 39.44% surge month-to-date.

The post-earnings price action review highlights a historically poor performance for a strategy of buying PGY shares after a revenue raise quarter-over-quarter on the financial report release date and holding for 30 days. Over the past three years, this approach has yielded an 85.01% loss, with a Sharpe ratio of -0.44, a CAGR of -47.38%, and a maximum drawdown of 0%. These statistics emphasize the high risk and negative returns associated with the strategy.

CEO Gal Krubiner emphasized Pagaya’s strong Q2 results, noting $17 million in GAAP net income and $326 million in total revenue. He highlighted the company’s unique business model, including AI-driven underwriting, a network of 31 lenders, and diversified funding sources. Key growth initiatives such as Prescreen, affiliate optimization, and FastPass are expanding partners’ customer acquisition and loan approval capabilities. Strategic priorities include expanding partner pipelines with U.S. regional banks and FinTechs and leveraging technology for operational efficiency. Despite macroeconomic uncertainties, Krubiner expressed cautious optimism, emphasizing disciplined growth and strong credit performance.

Pagaya raised its full-year 2025 guidance, targeting network volume of $10.5–$11.5 billion and total revenue of $1.25–$1.325 billion, with adjusted EBITDA expected to reach $345–$370 million. For Q3 2025, the company anticipates network volume of $2.75–$2.95 billion, total revenue of $330–$350 million, and adjusted EBITDA of $90–$100 million. GAAP net income guidance for Q3 is $10–$20 million, though the company expects a net loss of $5–$10 million due to one-time costs from the bond issuance and early debt retirement. For the full year, GAAP net income is projected to range between $55–$75 million.

The recent $500 million bond issuance validates the company’s capital structure strategy and long-term resilience. The outlook reflects disciplined, through-cycle growth and continued margin expansion, driven by high operating leverage and stable credit performance.

Additional News

Recent news highlights include political and economic developments in Nigeria and beyond. A key development involves the Federal Government expanding its ₦25,000 cash transfer scheme to reach 15 million vulnerable citizens. This move is part of broader efforts to support economic stability. Additionally, the Kaduna State Governor emphasized the importance of APC victory in upcoming by-elections, indicating strong political focus in the region.

On the international front, Germany announced a suspension of arms exports to Israel over concerns regarding control of the Gaza Strip. This decision reflects growing geopolitical tensions and evolving diplomatic strategies. Meanwhile, in the U.S., gold futures hit a record high following new tariffs on bullion bars, signaling investor concerns and increased demand for safe-haven assets.

Other notable news includes the Nigerian Centre for Disease Control issuing a public health advisory on Chikungunya amid a global outbreak. This highlights ongoing public health challenges and the need for continued vigilance and response. In Nigeria, the Plateau State Governor announced a collaboration with the World Bank to address environmental challenges, focusing on flood and drought mitigation. These developments underscore the interplay between health, environment, and governance in the region.