1 00:00:02,520 --> 00:00:09,240 Speaker 1: Bloomberg Audio Studios, podcasts, radio news. SOFI shares, like the 2 00:00:09,240 --> 00:00:12,319 Speaker 1: rest of the market, slumping today, in fact, having its 3 00:00:12,360 --> 00:00:15,160 Speaker 1: worst day since March of last year. The fintech lender 4 00:00:15,240 --> 00:00:18,800 Speaker 1: publishing perhaps a forecast that seems to be below where 5 00:00:18,840 --> 00:00:21,599 Speaker 1: the marketer wanted to see. We've got a broad tech route, 6 00:00:21,600 --> 00:00:23,800 Speaker 1: of course, linked to deep Seat more broadly in general, 7 00:00:23,840 --> 00:00:25,959 Speaker 1: to AI over in China. But here to discuss the earning, 8 00:00:26,000 --> 00:00:29,680 Speaker 1: SOFI CEO Anthony Noto, a tough day to report earnings. Anthony, 9 00:00:29,720 --> 00:00:31,880 Speaker 1: and I ask you about the forecast, because look, your 10 00:00:31,880 --> 00:00:34,640 Speaker 1: revenue was at record rates. Adjusted revenue up twenty four 11 00:00:34,680 --> 00:00:37,240 Speaker 1: percent for the fourth quarter. But you're pushing us forward 12 00:00:37,240 --> 00:00:40,280 Speaker 1: in a forecast that isn't as high as the market wanted. 13 00:00:40,320 --> 00:00:43,040 Speaker 2: Why well, I think two things. 14 00:00:43,120 --> 00:00:46,879 Speaker 3: One. Twenty twenty four, we took a pretty conservative approach 15 00:00:46,960 --> 00:00:50,599 Speaker 3: to the year in terms of our growth and our profitability. 16 00:00:50,640 --> 00:00:53,640 Speaker 3: We really wanted to make sure that we were able 17 00:00:53,640 --> 00:00:57,600 Speaker 3: to drive strong profitability in twenty four to achieve gap profitability, 18 00:00:57,760 --> 00:01:02,200 Speaker 3: to ensure we reinforced our balance sheet and a capital cushion, 19 00:01:02,240 --> 00:01:05,320 Speaker 3: and we did just that. Prior to twenty twenty four, 20 00:01:05,360 --> 00:01:08,319 Speaker 3: we had committed to a balanced approach to growth and 21 00:01:08,360 --> 00:01:12,399 Speaker 3: profitability where we would reinvest seventy cents of every incremental 22 00:01:12,480 --> 00:01:15,039 Speaker 3: revenue dollar and we call that thirty percent incremental eb 23 00:01:15,120 --> 00:01:18,319 Speaker 3: down margins. So we took our revenue forecast for twenty 24 00:01:18,360 --> 00:01:20,640 Speaker 3: five up and we're in the best position we've been 25 00:01:20,720 --> 00:01:22,400 Speaker 3: since I've been here, at so far for the last 26 00:01:22,400 --> 00:01:25,800 Speaker 3: seven years. We're calling for twenty five percent revenue growth, 27 00:01:26,160 --> 00:01:29,200 Speaker 3: strong margins at twenty six percent, just not an expansion 28 00:01:29,240 --> 00:01:32,160 Speaker 3: in the margins because we want to invest in the 29 00:01:32,319 --> 00:01:35,039 Speaker 3: massive opportunity that still sits in front of us. And 30 00:01:35,120 --> 00:01:37,800 Speaker 3: so we took revenue guidance up and it's about ten 31 00:01:37,840 --> 00:01:40,640 Speaker 3: percent higher than the street, but that will require more 32 00:01:40,680 --> 00:01:42,759 Speaker 3: investment and it will help us ensure we have growth 33 00:01:42,800 --> 00:01:45,840 Speaker 3: beyond twenty five. And we also took our revenue guidance 34 00:01:45,920 --> 00:01:49,320 Speaker 3: for twenty twenty three to twenty twenty six on a 35 00:01:49,360 --> 00:01:51,680 Speaker 3: compound in a growth rate basis higher as well. 36 00:01:52,040 --> 00:01:54,360 Speaker 2: So the profitability the business is there. 37 00:01:54,480 --> 00:01:56,360 Speaker 3: We could drive more to the bottom line, but we 38 00:01:56,400 --> 00:01:58,960 Speaker 3: think that's not the prudent thing to do because we 39 00:01:59,040 --> 00:02:01,840 Speaker 3: just see massive growth in front of us and the 40 00:02:01,920 --> 00:02:04,400 Speaker 3: ability for us to keep driving member growth and product 41 00:02:04,440 --> 00:02:07,040 Speaker 3: growth of more than thirty percent, which we've done, and 42 00:02:07,120 --> 00:02:10,840 Speaker 3: revenue growth of more than twenty five percent. Is you 43 00:02:10,919 --> 00:02:14,239 Speaker 3: know what we're calling for through twenty twenty six. 44 00:02:15,200 --> 00:02:18,440 Speaker 4: Anthony, the investment that you just describe, what portion of 45 00:02:18,440 --> 00:02:22,000 Speaker 4: it will you be putting toward artificial intelligence? It's the 46 00:02:22,040 --> 00:02:24,600 Speaker 4: topic at the top of everybody's minds, and people are 47 00:02:24,639 --> 00:02:28,079 Speaker 4: watching how companies are deploying it. Do you see, for instance, 48 00:02:28,120 --> 00:02:31,480 Speaker 4: an agent driven service? Perhaps at so far, At some point. 49 00:02:32,360 --> 00:02:35,320 Speaker 3: The vast majority of our investment going into twenty twenty 50 00:02:35,320 --> 00:02:38,320 Speaker 3: five and twenty six will be in building unaided bread awareness, 51 00:02:38,480 --> 00:02:40,639 Speaker 3: becoming a trusted household brand name. 52 00:02:40,680 --> 00:02:41,919 Speaker 2: We have great products. 53 00:02:42,280 --> 00:02:44,720 Speaker 3: The reason why we're driving such strong product and member 54 00:02:44,720 --> 00:02:47,919 Speaker 3: growth is because the products are very differentiated, and when 55 00:02:47,919 --> 00:02:50,680 Speaker 3: we make people aware of them and they use the products, 56 00:02:50,720 --> 00:02:53,040 Speaker 3: they not just use the first one and they gain 57 00:02:53,120 --> 00:02:55,320 Speaker 3: trust with us, they use the second and third one. 58 00:02:55,760 --> 00:02:58,480 Speaker 3: Thirty percent of our product growth in the quarter of 59 00:02:58,520 --> 00:03:03,000 Speaker 3: thirty four percent was or existing members. About forty percent 60 00:03:03,160 --> 00:03:05,880 Speaker 3: of our members take out a second product within thirty days, 61 00:03:06,200 --> 00:03:08,840 Speaker 3: So we'll continue to invest in differentiating the product. So 62 00:03:08,840 --> 00:03:10,760 Speaker 3: Ife Money is a great product that has a high 63 00:03:10,800 --> 00:03:13,880 Speaker 3: apy you can do person to person payments. You could 64 00:03:13,880 --> 00:03:17,600 Speaker 3: do Zell auto pay two day early paycheck, and so 65 00:03:17,680 --> 00:03:19,720 Speaker 3: we'll be investing in that. We'll be investing in our 66 00:03:19,720 --> 00:03:23,520 Speaker 3: invest product to expand the selection for invest in addition 67 00:03:23,560 --> 00:03:26,240 Speaker 3: to other product categories like insurance and credit card and 68 00:03:26,280 --> 00:03:27,519 Speaker 3: small medium business lending. 69 00:03:28,240 --> 00:03:30,280 Speaker 1: You want to be able to offer crypto again, and 70 00:03:30,280 --> 00:03:32,480 Speaker 1: that's something the administration's talked a lot about. Look on 71 00:03:32,520 --> 00:03:34,880 Speaker 1: a day where we see such volatility that engulfs crypto 72 00:03:34,960 --> 00:03:37,240 Speaker 1: too because of deep seek, is that really a product 73 00:03:37,240 --> 00:03:38,720 Speaker 1: priacement that you want to get into again? 74 00:03:39,800 --> 00:03:43,280 Speaker 3: If the regulation has changed so that cryptocurrency is permissible 75 00:03:44,000 --> 00:03:47,000 Speaker 3: by bank holding companies, we would absolutely provide not just 76 00:03:47,040 --> 00:03:49,040 Speaker 3: what we used to provide, which was the ability to 77 00:03:49,400 --> 00:03:54,160 Speaker 3: safely and securely trade bitcoin and other cryptocurrencies, but we'll 78 00:03:54,160 --> 00:03:57,280 Speaker 3: also go into other areas like custing and clearing in 79 00:03:57,320 --> 00:04:00,360 Speaker 3: addition to asset back lending, et cetera. But that all 80 00:04:00,360 --> 00:04:03,600 Speaker 3: be gated by the regulators, which we think should be 81 00:04:03,640 --> 00:04:06,720 Speaker 3: coming over the next twenty four months, and we'll be ready. 82 00:04:06,480 --> 00:04:07,040 Speaker 2: When it does. 83 00:04:07,960 --> 00:04:12,160 Speaker 1: Ultimately, are you feeling more risk on in this environment 84 00:04:12,240 --> 00:04:14,640 Speaker 1: the new administration a way in which to develop your business? 85 00:04:14,680 --> 00:04:16,200 Speaker 1: Maybe M and a because it doesn't feel like a 86 00:04:16,279 --> 00:04:17,120 Speaker 1: risk on day today. 87 00:04:18,120 --> 00:04:21,960 Speaker 3: We are definitely leaning into twenty twenty five. Twenty twenty 88 00:04:21,960 --> 00:04:25,760 Speaker 3: four was a record breaking year. We had record revenue, profits, returns, 89 00:04:26,040 --> 00:04:28,919 Speaker 3: member growth, product growth. Couldn't be happier. The year that 90 00:04:28,920 --> 00:04:31,719 Speaker 3: we had the most product's been at the company since 91 00:04:31,760 --> 00:04:34,000 Speaker 3: I've been here. But I think twenty twenty five will 92 00:04:34,000 --> 00:04:36,920 Speaker 3: be even better. We think the outlook is the best 93 00:04:37,000 --> 00:04:39,880 Speaker 3: environment we've operated in over the last seven years. Our 94 00:04:39,920 --> 00:04:42,480 Speaker 3: business is bigger, stronger, and more well known than it's 95 00:04:42,480 --> 00:04:44,440 Speaker 3: ever been, and we have more resources to go after 96 00:04:44,480 --> 00:04:47,479 Speaker 3: the opportunities. So we love our competitive positioning. We like 97 00:04:47,520 --> 00:04:50,120 Speaker 3: the macro backdrop. It's a very different outlook than when 98 00:04:50,160 --> 00:04:52,440 Speaker 3: we came in to twenty twenty four, and we're definitely 99 00:04:52,440 --> 00:04:56,520 Speaker 3: being more aggressive in innovation and driving durable growth and 100 00:04:56,600 --> 00:04:57,440 Speaker 3: strong returns. 101 00:04:58,760 --> 00:05:01,920 Speaker 4: Anthony, back to the regular Tory side of things, What 102 00:05:02,040 --> 00:05:04,760 Speaker 4: is the one thing, one hurdle that you would like 103 00:05:04,839 --> 00:05:08,520 Speaker 4: to see the new administration and Congress is clear for you. 104 00:05:10,080 --> 00:05:13,200 Speaker 3: The biggest question is what what will bank holding companies 105 00:05:13,240 --> 00:05:16,440 Speaker 3: be allowed to do with cryptocurrency? What will be permissible? 106 00:05:16,480 --> 00:05:20,200 Speaker 3: And that clarity is really critically important. The interest rate 107 00:05:20,240 --> 00:05:23,440 Speaker 3: cycle I think has pretty good visibility and transparency to that. 108 00:05:23,600 --> 00:05:27,280 Speaker 3: I think the economy also has really strong economic indicators. 109 00:05:27,920 --> 00:05:29,839 Speaker 2: The big question is how much can we innovate? 110 00:05:29,880 --> 00:05:32,680 Speaker 3: How much can we invest in these different asset classes 111 00:05:32,839 --> 00:05:36,040 Speaker 3: that our members want to reinforce their ability to not 112 00:05:36,200 --> 00:05:39,039 Speaker 3: just borrow better and save better and protect better, but 113 00:05:39,120 --> 00:05:42,360 Speaker 3: to invest better. Investing is critical to reaching their long 114 00:05:42,440 --> 00:05:44,760 Speaker 3: term financial goals. We want to be there for every 115 00:05:44,800 --> 00:05:47,839 Speaker 3: one of the major financial decisions our members making their lives, 116 00:05:48,080 --> 00:05:50,320 Speaker 3: and all the days in between. The key is spending 117 00:05:50,360 --> 00:05:52,280 Speaker 3: less than you make in investing the rest. So the 118 00:05:52,279 --> 00:05:55,000 Speaker 3: more opportunities we can give our members to invest, the 119 00:05:55,040 --> 00:05:56,919 Speaker 3: faster they'll get to their financial outcomes. 120 00:05:57,240 --> 00:05:59,000 Speaker 1: Anthony notos So, if I see you in the day 121 00:05:59,000 --> 00:06:01,440 Speaker 1: of your earnings, great to have you on. Thank you 122 00:06:01,480 --> 00:06:01,880 Speaker 1: so much.