Pagaya Technologies .(US:PGY)2025-11-10 21:04Financial Performance - Revenue from fees for the three months ended September 30, 2025, was $339,887 thousand, a 36.3% increase compared to $249,283 thousand for the same period in 2024[20] - Operating income for the nine months ended September 30, 2025, was $184,112 thousand, significantly higher than $35,101 thousand for the same period in 2024, marking an increase of over 424%[20] - Net income attributable to Pagaya Technologies Ltd. for the three months ended September 30, 2025, was $22,545 thousand, compared to a net loss of $67,476 thousand for the same period in 2024[20] - Comprehensive income attributable to Pagaya Technologies Ltd. for the three months ended September 30, 2025, was $10,320 thousand, recovering from a loss of $86,858 thousand in the same period of 2024[22] - For the nine months ended September 30, 2025, Pagaya Technologies reported a net income of $42.3 million, a significant improvement compared to a net loss of $188.6 million in the same period of 2024[26] - The company reported a net income (loss) before income taxes of $8,063 thousand for the three months ended September 30, 2025, compared to a loss of $85,755 thousand for the same period in 2024[20] - Net income for the period ending September 30, 2025, was $47,093,000, while the comprehensive loss amounted to $34,580,000[24] - Total revenue and other income increased by $92.9 million, or 36%, to $350.2 million for the three months ended September 30, 2025, compared to $257.2 million for the same period in 2024[203] Assets and Liabilities - Total assets increased to $1,455,376 thousand as of September 30, 2025, up from $1,291,072 thousand as of December 31, 2024, representing a growth of approximately 12.7%[17] - Total liabilities rose to $889,438 thousand as of September 30, 2025, compared to $775,276 thousand as of December 31, 2024, indicating an increase of approximately 14.7%[17] - As of September 30, 2025, Pagaya Technologies Ltd. reported a total equity of $535,835,000, with retained earnings showing a deficit of $896,950,000[24] - Cash and cash equivalents increased to $218,314 thousand as of September 30, 2025, up from $187,921 thousand as of December 31, 2024, reflecting a growth of 16.2%[17] - The balance of redeemable convertible preferred shares decreased to $30,103,000 as of September 30, 2025[24] - The total number of ordinary shares outstanding increased to 80,127,904 as of September 30, 2025, reflecting an increase from previous periods[24] Expenses - Technology, data, and product development expenses for the nine months ended September 30, 2025, were $56,135 thousand, slightly down from $57,970 thousand in the same period of 2024[20] - Share-based compensation expenses were reported at $44.0 million for the nine months ended September 30, 2025, slightly down from $45.9 million in the same period of 2024[26] - The company recognized share-based compensation expenses totaling $47,821,000 during the reporting period[24] - General and administrative expenses decreased from $57.8 million to $36.9 million, reflecting a reduction in personnel-related costs[208] - Sales and marketing costs for Q3 2025 increased by $3.0 million to $11.4 million, a 26% rise compared to Q3 2024[213] Cash Flow and Investments - The company generated $158.8 million in net cash from operating activities for the nine months ended September 30, 2025, compared to $19.9 million in the same period of 2024[26] - Pagaya Technologies' cash flows from investing activities resulted in a net cash outflow of $209.5 million for the nine months ended September 30, 2025, compared to an outflow of $448.1 million in the same period of 2024[26] - The company reported additions to investments in loans and securities of $67,811,000 for the three months ended September 30, 2025, compared to $130,271,000 for the same period in 2024[116] - The company experienced a loss from investments in loans and securities amounting to $65.5 million for the nine months ended September 30, 2025, compared to $157.5 million in the same period of 2024[26] Debt and Financing - The Company issued $160 million of 6.125% Exchangeable Notes due 2029, with an effective interest rate of 8.7%[61][62] - The Company completed the issuance of $500 million Senior Unsecured Notes due 2030, accruing interest at 8.875% per annum[63] - The Company incurred a loss of $1.1 million related to the write-off of deferred issuance costs during Q3 2025[56] - The Company’s secured borrowings decreased to $131.5 million as of September 30, 2025, down from $176.1 million at the end of 2024[55] - Long-term debt increased to $487.8 million as of September 30, 2025, compared to $321.3 million at the end of 2024, reflecting a 52% rise[55] Market and Economic Conditions - Macroeconomic conditions, including inflation and geopolitical tensions, may affect consumer demand and the availability of funding from investors[176] - The Company has diversified its investor network, which is critical for growth, despite macroeconomic pressures such as high interest rates and inflation[178] - The company aims to enhance financial opportunities through its AI-powered technology and data network, targeting improved creditworthiness assessments for financial products[152] Shareholder Information - The weighted average shares outstanding for basic shares increased to 78,539,137 for the three months ended September 30, 2025, compared to 72,728,667 for the same period in 2024[20] - Basic earnings per share increased to $0.27 for the three months ended September 30, 2025, compared to a loss of $0.93 for the same period in 2024[201] - The total shares of ordinary shares reserved for future issuance as of September 30, 2025, was 53,257,011, a slight decrease from 54,762,940 as of December 31, 2024[123] Regulatory and Compliance - The transition to "large accelerated filer" status will occur as of December 31, 2025, requiring compliance with additional disclosure requirements and auditor attestation[158] - The company is currently subject to federal tax audits in Israel and the U.S., with no material issues raised to date[145]