SoFi Reports Third Quarter 2025 with Record Net Revenue of $962 Million, Record Member and Product Growth, Net Income of $139 Million

Adjusted Net Revenue up 38% to a record $950 million

Adjusted EBITDA up 49% to a record $277 million

Fee-based Revenue up 50% to a record $409 million

Member growth up 35% to a record 12.6 million members

Product growth up 36% to a record 18.6 million products

Management Raises 2025 Guidance

SoFi Technologies, Inc. (NASDAQ:SOFI), a member-centric, one-stop shop for digital financial services that helps members borrow, save, spend, invest and protect their money, reported financial results today for its third quarter ended September 30, 2025.

This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20251028756056/en/

Note: For additional information on our company metrics, including the definitions of "Members", "Total Products" and "Technology Platform Total Accounts", see Table 6 in the "Financial Tables" herein. New member and new product addition metrics for the relevant period reflect actual growth or declines in members and products that occurred in that period whereas the total number of members and products reflects not only the growth or decline of each metric in the current period but also additions or deletions due to prior period factors, if any. (1) The company includes SoFi accounts on the Galileo platform-as-a-service in its total Technology Platform accounts metric to better align with the presentation of Technology Platform segment revenue.

"SoFi delivered an exceptional third quarter, fueled by the strength of our innovation and the power of our one-stop shop strategy," said Anthony Noto, CEO of SoFi.

"We achieved record adjusted net revenue of $950 million and added a record 905,000 new members and 1.4 million new products. Our ability to consistently deliver durable growth, strong returns, and exceptional credit performance proves that our strategy is battle-tested and built to outperform. The opportunity before us is massive and SoFi is executing from a position of unparalleled strength. That's why 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."

Product Highlights

• Set New Records in Members and Products. A record 905,000 new members joined SoFi in the quarter, up 35% from the prior year to 12.6 million. SoFi added a record 1.4 million new products, up 36% from the prior year to 18.6 million products.

• Delivering Results with SoFi's One-Stop Shop. SoFi's integrated financial services model drove strong product adoption across the business. Cross-buy hit its highest level since 2022, with approximately 40% of new products opened by existing SoFi members. This growth was fueled by SoFi's industry-leading products designed to deliver exceptional value and a seamless experience for members. Innovations including Cash Coach, Level 1 Options, expanded access to alternative investments, and the increasing benefits of SoFi Plus are expected to continue driving momentum and deepen member engagement.

• Demonstrating Successful Diversification and Durable Growth with Record Fee‑Based Revenue. Total fee-based revenue across the business achieved a record $408.7 million, up 50% from the prior year, now generating over $1.6 billion on an annualized basis. This was driven by strong performance from our Loan Platform Business (LPB), which originated $3.4 billion in loans on behalf of third parties in the third quarter and generated $167.9 million in revenue, up 29% from the second quarter and 2.75x from the prior year. LPB is now running at an annualized pace of over $13 billion of originations and $660 million of high-margin, high-return, fee-based revenue.

• Accelerating Loan Originations to Record-Highs. SoFi achieved record total loan originations of $9.9 billion this quarter, up 57% year-over-year, reflecting strong demand across personal, student, and home loans. Personal loan originations reached an all-time high of $7.5 billion while student loan originations increased 58% to $1.5 billion. Home lending set a new record with nearly $945 million in originations, including a record $352 million in home equity loans. This performance was fueled by continuous innovations, including the introduction of interest-only periods for Personal Loans, new step-up repayment options for student loans, and home equity loans.

• Transforming the Future of Finance with Crypto and AI. SoFi launched fast, low-cost international remittances through the blockchain with SoFi Pay. SoFi Crypto will launch later this year and will allow members to buy, sell, and hold dozens of tokens directly in the app. SoFi launched its AI-powered Cash Coach to help members optimize their cash, with further innovations planned in 2026.

• Strengthened Brand Awareness to Attract More Members to SoFi's Ecosystem. With continued investment to build SoFi into a trusted household name, unaided brand awareness accelerated to an all-time high of 9.1% – an increase of over 4x in just four years.

• Continuing Strength in Credit Performance. SoFi's annualized charge-off rate decreased by more than 20-basis points for both personal loans and student loans compared to the prior quarter, with personal loan net charge-offs reaching their lowest level in over 2 years. The on-balance sheet 90-day delinquency rate for both personal loans and student loans remained consistent with the prior quarter, increasing just one basis point in the third quarter.

Consolidated Results

SoFi reported a number of key financial achievements. For the third quarter of 2025, GAAP net revenue of $961.6 million increased 38% relative to the prior-year period's $697.1 million. Record adjusted net revenue of $949.6 million grew 38% from the corresponding prior-year period of $689.4 million.

For the third quarter of 2025, total fee-based revenue reached a record of $408.7 million, a year-over-year increase of 50%. This was driven by strong performance from our Loan Platform Business, as well as origination fee revenue, referral fee revenue, interchange fee revenue and brokerage fee revenue. Together, the Financial Services and Technology Platform segments generated $534.2 million of net revenue, an increase of 57% from the prior year period.

Third quarter record adjusted EBITDA of $276.9 million increased 49% from the prior year period's $186.2 million. This represents an adjusted EBITDA margin of 29%. All three segments delivered strong contribution profit, at attractive margins.

SoFi reported its eighth consecutive quarter of GAAP profitability. For the third quarter of 2025, GAAP net income reached $139.4 million and diluted earnings per share reached $0.11.

Equity grew by $1.9 billion during the quarter, ending at $8.8 billion and $7.29 of book value per share. Tangible book value grew by $1.9 billion during the quarter, ending the period at $7.2 billion. Tangible book value per share was $5.97 at quarter-end, up from $4.08 per share in the prior year period.

Net interest income of $585.1 million for the third quarter was up 36% year-over-year. This was driven by a 29% increase in average interest-earning assets and a 76 basis point decrease in cost of funds, partially offset by a 45 basis point decrease in average asset yields year-over-year. For the third quarter, net interest margin of 5.84% increased 27 basis points year-over-year from 5.57%.

The average rate on deposits in the third quarter was 190 basis points lower than that of warehouse facilities, which translates to approximately $627.1 million of annualized interest expense savings due to the successful remixing of our funding base.

Member and Product Growth

Continued growth in both total members and products in the third quarter is the result of our continued investments in innovation and brand building and reflects the benefits of our broad product suite and unique Financial Services Productivity Loop (FSPL) strategy.

SoFi added a record 905,000 members in the third quarter of 2025, bringing total members over 12.6 million, up 35% from 9.4 million at the end of the same prior year period.

SoFi also achieved record product additions of 1.4 million in the third quarter of 2025, bringing total products to nearly 18.6 million, up 36% from 13.7 million at the end of the same prior year period.

Financial Services products increased by 37% year-over-year to 16.1 million, primarily driven by continued demand for our SoFi Money, Relay and Invest products, and drove 88% of our total product growth.

Lending products increased by 30% year-over-year to 2.5 million, driven by continued demand for personal, student, and home loan products.

Technology Platform enabled accounts decreased 1% year-over-year to 158 million.

Financial Services Segment Results

For the third quarter of 2025, Financial Services segment net revenue of $419.6 million increased 76% from the prior year period. Net interest income of $203.7 million increased 32% year-over-year, primarily driven by growth in consumer deposits. Noninterest income of $216.0 million more than doubled year-over-year.

In the third quarter, SoFi's Loan Platform Business added $167.9 million to our consolidated adjusted net revenue. Of this, $164.9 million was driven by $3.4 billion of personal loans originated on behalf of third parties as well as referrals to third parties.

In addition to our Loan Platform Business, SoFi continued to see healthy growth in interchange fee revenue in the third quarter, up 55% year-over-year, as a result of nearly $20 billion in total annualized spend in the quarter across SoFi Money and Credit Card.

Contribution profit for the third quarter of 2025 reached $225.6 million, a $125.8 million improvement from the prior year period, while contribution margin grew 12 percentage points year-over-year to 54%. This is a reflection of the strong operating leverage generated in the segment by net revenue growth of 76% with directly attributable expenses increasing only 39%.

By continuously innovating with new and relevant offerings, features and rewards for members, SoFi grew total Financial Services products by 4.3 million, or 37%, year-over-year, bringing the total to 16.1 million at quarter-end. SoFi Money reached 6.3 million products, Relay reached 6.0 million products and SoFi Invest reached 3.0 million products by the end of the third quarter.

Monetization continues to improve with annualized revenue per product of $104 during the third quarter, up 29% year-over-year.

In the third quarter of 2025, total deposits grew $3.4 billion to $32.9 billion, with nearly 90% of SoFi Money deposits (inclusive of Checking and Savings and cash management accounts) coming from direct deposit members.

Technology Platform Segment Results

Technology Platform segment net revenue of $114.6 million for the third quarter of 2025 increased 12% year-over-year. Contribution profit of $32.4 million reflected a contribution margin of 28%.

Technology Platform total enabled client accounts decreased 1% year-over-year, to 157.9 million, down from 160.2 million in the prior-year period.

Lending Segment Results

For the third quarter of 2025, Lending segment GAAP net revenue of $493.4 million increased 25% from the prior year period, while adjusted net revenue for the segment of $481.4 million increased 23% from the prior year period.

Lending segment performance in the third quarter was driven by net interest income, which rose 35% year-over-year, primarily driven by growth in average loan balances of 35%.

Lending segment third quarter contribution profit of $261.6 million was up 9% from $238.9 million in the corresponding prior-year period. Lending segment adjusted contribution margin was strong at 54%. This strong performance reflects our ability to capitalize on continued strong demand for our lending products.

The following table summarizes the significant inputs to the fair value model for personal and student loans:

For the third quarter of 2025, record origination volume of $9.9 billion increased 57% year-over-year. This was a result of continued strong member demand for personal loans, student loans and home loans as well as strong demand from capital markets partners.

Record personal loan originations of $7.5 billion in the third quarter of 2025 were up 53% year-over-year, inclusive of $3.4 billion originated on behalf of third parties through our Loan Platform Business. Third quarter student loan volume of $1.5 billion was up 58% year-over-year. Home equity loan originations were a record during the third quarter, accounting for one-third of total home loan volume. In total, home loan volume was $945 million, an increase of 93% year-over-year.

Capital markets activity in the third quarter of 2025 was very strong. Overall, SoFi sold, or transferred through our Loan Platform Business, more than $4.6 billion in total of personal loans, student loans, and home loans. In terms of personal loans, we closed $175.0 million of sales in whole loan form at a blended execution of 106.4%. In terms of student loans, we closed $376.5 million of sales in whole loan form at a blended execution of 105.9%. In terms of home loan sales, we closed $584.8 million at a blended execution of 102.9%.

In addition to our personal, student and home loan sales, SoFi executed a $466 million co-contributor securitization of loans previously originated through our Loan Platform Business. This was the third securitization of new collateral under our SoFi Consumer Loan Program (SCLP) since 2021 using collateral originated in the Loan Platform Business. Importantly, this channel provides our partners with meaningful liquidity to support their ongoing investment in the Loan Platform Business. The transaction priced at industry-leading cost-of-funds levels, with a weighted average spread of 98 basis points.

Credit performance remained strong in the third quarter. The on-balance sheet 90-day delinquency rates for both personal loans and student loans were consistent with the prior quarter.

The personal loan annualized charge-off rate decreased to 2.60% from 2.83% in the prior quarter, including the impact of asset sales, new originations and delinquency sales in the quarter. Had SoFi not sold late stage delinquent loans, it is estimated that, including recoveries, the all-in annualized net charge-off rate for personal loans would have been approximately 4.2% versus 4.5% in the prior quarter.

The data continues to support a 7–8% maximum cumulative net loss assumption for personal loans, in line with SoFi's underwriting tolerance.

Recent vintages, originated from the fourth quarter of 2022 to the fourth quarter of 2024, have net cumulative losses of 4.40%, with 39% unpaid principal balance remaining. This is well below the 6.08% observed at the same point in time for the 2017 vintage which is the last vintage that approached our 7-8% tolerance. The gap between the newer cohort curve and the 2017 cohort curve improved by 29 basis points, after improving 19 basis points last quarter, demonstrating continued improvement.

Additionally, of the first quarter of 2020 through the second quarter of 2025 originations, 60% of principal has already been paid down, with 6.7% in net cumulative losses. Therefore, for life-of-loan losses on this entire cohort of loans to reach 8%, the charge-off rate on the remaining 40% of unpaid principal would need to be approximately 10%. This would be well above past levels, providing further confidence in achieving loss rates below our 8% tolerance.

Guidance and Outlook

Given the strong performance through the first three quarters of the year, management is increasing its 2025 guidance issued in our second quarter earnings.

For the full year 2025, management now expects to add at least 3.5 million new members, which represents approximately 34% growth from 2024 levels. Management expects to deliver adjusted net revenue of approximately $3.54 billion, which is $165 million higher than the prior guidance of $3.375 billion. This implies approximately 36% annual growth versus 30% in our prior guidance. Management expects adjusted EBITDA of approximately $1.035 billion, above prior guidance of $960 million. This represents an EBITDA margin of 29%. SoFi expects adjusted net income of approximately $455 million, above prior guidance of $370 million. Lastly, SoFi expects adjusted EPS of approximately $0.37 cents per share, above prior guidance of $0.31 cents per share.

Management expects growth in tangible book value of approximately $2.5 billion for the year, above our prior guidance of $640 million.

Management will further address full-year guidance on the quarterly earnings conference call. Management has not reconciled forward-looking non-GAAP measures to their most directly comparable GAAP measures. This is because the company cannot predict with reasonable certainty and without unreasonable efforts the ultimate outcome of certain GAAP components of such reconciliations due to market-related assumptions that are not within our control as well as certain legal or advisory costs, tax costs or other costs that may arise. For these reasons, management is unable to assess the probable significance of the unavailable information, which could materially impact the amount of the future directly comparable GAAP measures.

Earnings Webcast

SoFi's executive management team will host a live audio webcast beginning at 8:00 a.m. Eastern Time (5:00 a.m. Pacific Time) today to discuss the quarter's financial results and business highlights. All interested parties are invited to listen to the live webcast at https://investors.sofi.com. A replay of the webcast will be available on the SoFi Investor Relations website for 30 days. Investor information, including supplemental financial information, is available on SoFi's Investor Relations website at https://investors.sofi.com.

Cautionary Statement Regarding Forward-Looking Statements

Certain of the statements above are forward-looking and as such are not historical facts. This includes, without limitation, statements regarding our expectations for full year 2025 adjusted net revenue, annual growth rate, adjusted EBITDA, adjusted EBITDA margin, GAAP net income, GAAP EPS, tangible book value, and new members, our expectations regarding our ability to continue to grow our business, build our brand and launch new business lines and products, including our plans to launch blockchain, crypto and AI related services, our ability to continue to drive momentum, deepen member engagement, and increase cross-buy, our expectations regarding the size of our market opportunity, our ability to continue to attract and execute deals, our ability to continue to improve our financials and increase our member, product and total accounts count, our ability to achieve diversified and more durable growth, including our ability to continue to grow our Loan Platform Business, our ability to continue the momentum seen in prior financial periods, our ability to have loss rates below 8%, our ability to navigate the macroeconomic, geopolitical and regulatory environment, any changes in demand for our products, and the financial position, business strategy and plans and objectives of management for our future operations. These forward-looking statements are not guarantees of performance. Such statements can be identified by the fact that they do not relate strictly to historical or current facts. Words such as "achieve", "believe", "continue", "expect", "capable" "future", "growth", "may", "opportunity", "plan", "potential", "strategy", "will be", "will continue", and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Factors that could cause actual results to differ materially from those contemplated by these forward-looking statements include: (i) the effect of and our ability to respond and adapt to changing market and economic conditions, including economic downturns, fluctuating inflation and interest rates, and volatility from macroeconomic, global, and political events, including announced or planned tariffs; (ii) our ability to maintain net income profitability, continue to increase fee-based revenue streams, continue to grow across our segments in the future, as well as our ability to meet our guidance; (iii) the impact on our business of the regulatory environment, changes in governmental policies, changes in personnel and resources of the governmental agencies that regulate us, and complexities with compliance related to such environment; (iv) our ability to realize the benefits of being a bank holding company and operating SoFi Bank, including continuing to grow high quality deposits and our rewards program for members; (v) our ability to continue to drive brand awareness and realize the benefits of our marketing and advertising campaigns; (vi) our ability to vertically integrate our businesses and accelerate the pace of innovation of our financial products; (vii) our ability to manage our growth effectively; (viii) our ability to access sources of capital on acceptable terms or at all; (ix) the success of our continued investments in our business; (x) our ability to expand our member base, increase our product adds and increase cross-buy; (xi) our ability to maintain our leadership position in certain categories of our business and to grow market share in existing markets or any new markets we may enter; (xii) our ability to cater to a broad range of clients and continue to execute deals with current or future business partners; (xiii) our ability to develop new products, features and functionality that are competitive and meet market needs; (xiv) our ability to realize the benefits of our strategy, including what we refer to as our FSPL; (xv) our ability to make accurate credit and pricing decisions or effectively forecast our loss rates; (xvi) our ability to establish and maintain an effective system of internal controls over financial reporting; (xvii) our ability to maintain the security and reliability of our products; and (xviii) the outcome of any legal or governmental proceedings instituted against us. The foregoing list of factors is not exhaustive. You should carefully consider the foregoing factors and the other risks and uncertainties set forth in the section titled "Risk Factors" in our last annual report on Form 10-K, as filed with the Securities and Exchange Commission, and those that are included in any of our future filings with the Securities and Exchange Commission. These forward-looking statements are based on information available as of the date hereof and current expectations, forecasts and assumptions, and involve a number of judgments, risks and uncertainties. Accordingly, forward-looking statements should not be relied upon as representing our views as of any subsequent date, and we do not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

As a result of a number of known and unknown risks and uncertainties, our actual results or performance may be materially different from those expressed or implied by these forward-looking statements. You should not place undue reliance on these forward-looking statements.

Non-GAAP Financial Measures

This press release presents information about certain non-GAAP financial measures provided as supplements to the results provided in accordance with accounting principles generally accepted in the United States (GAAP). Our management and Board of Directors uses these non-GAAP measures to evaluate our operating performance, formulate business plans, help better assess our overall liquidity position, and make strategic decisions, including those relating to operating expenses and the allocation of internal resources. Accordingly, we believe that these non-GAAP measures provide useful information to investors and others in understanding and evaluating our operating results in the same manner as our management and Board of Directors. These non-GAAP measures have limitations as analytical tools, and should not be considered in isolation from, or as a substitute for, the analysis of other GAAP financial measures. Other companies may not use these non-GAAP measures or may use similar measures that are defined in a different manner. Therefore, SoFi's non-GAAP measures may not be directly comparable to similarly titled measures of other companies.

Reconciliations of these non-GAAP measures to the most directly comparable GAAP financial measures are provided in Table 2 to the "Financial Tables" herein.

About SoFi

SoFi Technologies (NASDAQ:SOFI) is a one-stop shop for digital financial services on a mission to help people achieve financial independence to realize their ambitions. Over 12.6 million members trust SoFi to borrow, save, spend, invest, and protect their money – all in one app – and get access to financial planners, exclusive experiences, and a thriving community. Fintechs, financial institutions, and brands use SoFi's technology platform Galileo to build and manage innovative financial solutions across 157.9 million global accounts. For more information, visit www.sofi.com or download our iOS and Android apps.

Availability of Other Information About SoFi

Investors and others should note that we communicate with our investors and the public using our website (https://www.sofi.com), the investor relations website (https://investors.sofi.com), and on social media (X and LinkedIn), including but not limited to investor presentations and investor fact sheets, Securities and Exchange Commission filings, press releases, public conference calls and webcasts. The information that SoFi posts on these channels and websites could be deemed to be material information. As a result, SoFi encourages investors, the media, and others interested in SoFi to review the information that is posted on these channels, including the investor relations website, on a regular basis. This list of channels may be updated from time to time on SoFi's investor relations website and may include additional social media channels. The contents of SoFi's website or these channels, or any other website that may be accessed from its website or these channels, shall not be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended.

SOFI-F

FINANCIAL TABLES

(Unaudited)

1. Condensed Consolidated Statements of Operations and Comprehensive Income
2. Reconciliation of GAAP to Non-GAAP Financial Measures
3. Condensed Consolidated Balance Sheets
4. Average Balances and Net Interest Earnings Analysis
5. Company Metrics
6. Segment Financials
7. Fee-Based Revenue
8. Analysis of Charge-Offs
9. Regulatory Capital

Adjusted Net Revenue

Adjusted net revenue is a non-GAAP measure. Adjusted net revenue is defined as total net revenue, adjusted to exclude the fair value changes in servicing rights and residual interests classified as debt due to valuation inputs and assumptions changes, which relate only to our Lending segment, as well as gains and losses on extinguishment of debt. We adjust total net revenue to exclude these items, as they are non-cash charges that are not realized during the period or not indicative of our core operating performance, and therefore positive or negative changes do not impact the cash available to fund our operations. Management believes this measure is useful because it enables management and investors to assess our underlying operating performance and cash available to fund our operations. In addition, management uses this measure to better decide on the proper expenses to authorize for each of our operating segments, to ultimately help achieve target contribution profit margins.

The following table reconciles adjusted net revenue to total net revenue, the most directly comparable GAAP measure:

The following table reconciles adjusted net revenue for the Lending segment to total net revenue, the most directly comparable GAAP measure for the Lending segment:

Adjusted Noninterest Income

Adjusted noninterest income is a non-GAAP measure. Adjusted noninterest income is defined as noninterest income, adjusted to exclude the fair value changes in servicing rights and residual interests classified as debt due to valuation inputs and assumptions changes, which relate only to our Lending segment, as well as gains and losses on extinguishment of debt. We adjust noninterest income to exclude these items, as they are non-cash charges that are not realized during the period or not indicative of our core operating performance, and therefore positive or negative changes do not impact the cash available to fund our operations. Management believes this measure is useful because it enables management and investors to assess our underlying operating performance and cash available to fund our operations.

The following table reconciles adjusted noninterest income to noninterest income, the most directly comparable GAAP measure:

The following table reconciles adjusted noninterest income for the Lending segment to noninterest income, the most directly comparable GAAP measure for the Lending segment:

Adjusted Contribution Margin and Incremental Adjusted Contribution Margin — Lending

Adjusted contribution margin and incremental adjusted contribution margin are non-GAAP measures and relate only to our Lending segment. Adjusted contribution margin is defined as segment contribution profit for the Lending segment, divided by adjusted net revenue for the Lending segment, a non-GAAP measure. Incremental adjusted contribution margin is defined as the change in segment contribution profit for our Lending segment, divided by change in adjusted net revenue for the Lending segment. See ‘Adjusted Net Revenue' above for a reconciliation of Lending segment adjusted net revenue.

Management believes adjusted contribution margin metrics are useful because they enable management and investors to assess the underlying operating performance of our Lending segment, by removing the impact of changes in volume over periods to present a comparable view of segment contribution profit, which is a measure of the direct profitability of each of our reportable segments, as a percentage of segment adjusted net revenue for the Lending segment during each period.

The following table presents a reconciliation of adjusted contribution margin and incremental adjusted contribution margin for our reportable Lending segment:

Adjusted EBITDA, Adjusted EBITDA Margin and Incremental Adjusted EBITDA Margin

Adjusted EBITDA, adjusted EBITDA margin and incremental adjusted EBITDA margin are non-GAAP measures. Adjusted EBITDA is defined as net income, adjusted to exclude, as applicable: (i) corporate borrowing-based interest expense (our adjusted EBITDA measure is not adjusted for warehouse or securitization-based interest expense, nor deposit interest expense and finance lease liability interest expense, as these are direct operating expenses), (ii) income tax expense (benefit), (iii) depreciation and amortization, (iv) share-based expense (inclusive of equity-based payments to non-employees), (v) restructuring charges, (vi) impairment expense (inclusive of goodwill impairments and property, equipment and software abandonments), (vii) transaction-related expenses, (viii) foreign currency impacts related to operations in highly inflationary countries, (ix) fair value changes in each of servicing rights and residual interests classified as debt due to valuation assumptions, (x) gain on extinguishment of debt, and (xi) other charges, as appropriate, that are not expected to recur and are not indicative of our core operating performance.

Adjusted EBITDA margin is computed as adjusted EBITDA divided by adjusted net revenue. Incremental adjusted EBITDA margin is defined as the change in adjusted EBITDA, divided by change in adjusted net revenue. See ‘Adjusted Net Revenue' above for a reconciliation of this non-GAAP measure.

Management believes adjusted EBITDA, adjusted EBITDA margin and incremental adjusted EBITDA margin are useful measures for period-over-period comparisons of our business. These measures enable management and investors to assess our core operating performance or results of operations by removing the effects of certain non-cash items and charges, as well as the impact of changes in volume over periods as applicable. In addition, management uses these measures to help evaluate cash flows generated from operations and the extent of additional capital, if any, required to invest in strategic initiatives.

The following table reconciles adjusted EBITDA to net income, the most directly comparable GAAP measure, and presents the computations of adjusted EBITDA margin and incremental adjusted EBITDA margin:

Tangible Book Value and Tangible Book Value per Common Share

Beginning in the fourth quarter of 2024, the Company modified the presentation of its tangible book value and tangible book value per share, which are non-GAAP measures. Tangible book value is defined as permanent equity, adjusted to exclude goodwill and intangible assets, net of related deferred tax liabilities. Tangible book value per common share represents tangible book value at period-end divided by common stock outstanding at period-end. Prior periods were revised to conform with this presentation.

These measures are utilized by management in assessing our use of equity and capital adequacy. We believe that tangible book value presents a meaningful measure of net asset value, and tangible book value per share provides additional useful information to investors to assess capital adequacy.

The following table reconciles tangible book value to permanent equity, the most directly comparable GAAP measure, and presents the computation of permanent equity per common share and tangible book value per common share for the periods presented:

Adjusted Net Income, Adjusted Net Income Margin, Incremental Adjusted Net Income Margin and Adjusted EPS

Adjusted net income, adjusted net income margin, incremental adjusted net income margin and adjusted diluted earnings per share are non-GAAP measures. Adjusted net income is defined as net income, adjusted to exclude, as applicable, goodwill impairment expense and certain income tax benefits that are not expected to recur and are not indicative of our core operating performance.

Adjusted diluted earnings per share ("adjusted EPS") is a non-GAAP financial measure that adjusts GAAP diluted earnings per share. Adjusted EPS is computed by dividing net income attributable to common stockholders, adjusted to exclude, as applicable, goodwill impairment expense and certain income tax benefits that are not expected to recur and are not indicative of our core operating performance, by the diluted weighted average number of shares of common stock outstanding during the period, excluding the dilutive impact of the 2026 and 2029 convertible notes under the if-converted method for which the 2026 and 2029 capped call transactions, respectively, would deliver shares to offset dilution.

Adjusted net income margin is computed as adjusted net income divided by adjusted net revenue. Incremental adjusted net income margin is defined as the change in adjusted net income, divided by change in adjusted net revenue. See ‘Adjusted Net Revenue' above for a reconciliation of this non-GAAP measure.

Management believes adjusted net income, adjusted net income margin, incremental adjusted net income margin and adjusted EPS are useful because they enable management and investors to assess our core operating performance or results of operations, by removing the effects of certain non cash items and charges to present a comparable view for period over period comparisons of our business.

The following table: (i) reconciles adjusted net income to net income, the most directly comparable GAAP measure, (ii) reconciles adjusted EPS to diluted earnings per share, the most directly comparable GAAP measure, and (iii) presents the computations of adjusted net income margin and incremental adjusted net income margin.