Pagaya Technologies (PGY) Q3 2025 earnings summary

Executive summary

• Achieved record GAAP net income of $23 million for Q3 2025, reversing a $67 million loss a year ago, with annualized exit rate over $120 million and adjusted net income of $93 million.

• Total revenue and other income rose 36% year-over-year to $350 million, at the high end of guidance, with network volume up 19% to $2.8 billion, driven by Auto and Point-of-Sale verticals.

• Adjusted EBITDA increased 91% to $107 million, with margins expanding to 30.6%.

• Product suite enhancements, pre-built integrations, and robust partner onboarding accelerated growth and cross-selling across asset classes.

• Raised full-year guidance for total revenue, adjusted EBITDA, and GAAP net income for the third consecutive quarter.

Financial highlights

• Fee Revenue Less Production Costs (FRLPC) grew 39% to $139 million, reaching 5% of network volume.

• Operating income surged to $80 million in Q3 2025, up from $22 million a year ago.

• Operating cash flow hit a record $67 million in Q3 and $159 million for the nine months ended September 30, 2025.

• Core operating expenses dropped to 34% of FRLPC, lowest since going public, and decreased 11% year-over-year to $47 million.

• ABS issuance reached $7.4 billion on a trailing twelve-month basis, with a growing and diversified investor base.

Outlook and guidance

• FY 2025 guidance: network volume $10.5–$10.75 billion, revenue $1.3–$1.325 billion, adjusted EBITDA $372–$382 million, GAAP net income $72–$82 million.

• FRLPC expected to remain in the 4–5% range of network volume; profitability trends to reflect continued scale and leverage.

• Q4 2025 network volume expected between $2.65 billion and $2.9 billion; adjusted EBITDA between $99 million and $109 million.

• Management expects continued growth in network volume and fee revenue, supported by AI technology and partner network expansion.

• Sensitivity analysis projects potential credit-related impairments of $100–$150 million under adverse scenarios.