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Jun 30
Pagaya Q2 2025 Earnings Report
Pagaya reported second quarter and first half 2025 results, achieving its second consecutive quarter of positive GAAP net income and raising its full-year guidance.
Key Takeaways
Pagaya Technologies Ltd. delivered a strong second quarter in 2025, marked by record performance across key financial metrics. The company achieved positive GAAP net income for the second consecutive quarter, significantly increasing net income attributable to shareholders by $91 million year-over-year. Total revenue and other income grew by 30% year-over-year, and adjusted EBITDA saw a substantial 72% increase. Network volume also reached a record high, growing by 14% year-over-year, driven by strong performance in Auto and Point-of-Sale verticals. The company successfully issued its first AAA-rated Auto ABS and inaugural AAA-rated Point-of-Sale revolving ABS structures, alongside a successful $500 million Senior Unsecured Notes issuance.
Net income attributable to Pagaya shareholders reached $17 million, marking a significant increase of $91 million year-over-year.
Total revenue and other income grew by 30% year-over-year, reaching a record $326 million.
Adjusted EBITDA increased by 72% year-over-year to $86 million, demonstrating strong operating leverage.
Network volume achieved a record $2.6 billion, representing a 14% year-over-year increase, driven by growth in Auto and Point-of-Sale verticals.
Pagaya
Pagaya
Forward Guidance
Pagaya provided an optimistic outlook for the third quarter and full year 2025, expecting continued growth across key financial metrics, including network volume, total revenue, adjusted EBITDA, and GAAP net income. The guidance for GAAP net income includes the impact of one-time items related to corporate bond issuance and early debt retirement, partially offset by a tax-related benefit.
Positive Outlook
- Third quarter Network Volume expected to be between $2.75 billion and $2.95 billion.
- Third quarter Total Revenue and Other Income expected to be between $330 million and $350 million.
- Third quarter Adjusted EBITDA expected to be between $90 million and $100 million.
- Full year 2025 Network Volume expected to be between $10.5 billion and $11.5 billion.
- Full year 2025 Total Revenue and Other Income expected to be between $1.25 billion and $1.325 billion.
Challenges Ahead
- Third quarter GAAP Net Income expected to be between $10 million and $20 million, including a net loss of approximately $5 million to $10 million from one-time items.
- Full year 2025 GAAP Net Income expected to be between $55 million and $75 million.
- Approximately $24 million in costs associated with the issuance of the corporate bond are expected in Q3 2025.
- Costs associated with the early retirement of existing debt are expected in Q3 2025.
- The company cannot reconcile expected Adjusted EBITDA to expected Net Loss Attributable to Pagaya for the full year without unreasonable effort due to unpredictable items.