| By Andy Swan SoFi Technologies (SOFI) reported earnings before the bell Monday that beat expectations on nearly every level. But the market didn't like what it saw... 
SOFI Stock Price, Last 5 Days (TradingView) At first glance, it's a headscratcher. SoFi reported: ✓ Its second consecutive quarter of profit (2 cents a share bested the consensus $0.01)
✓ Quarterly net revenue of $645 million, up 37% year over year and far exceeding the expected $555.3 million
✓ Adjusted EBITDA of $144 million, growing 91% year over year
✓ 622,000 new member additions, bringing its total count to 8.1 million members â a 44% year-over-year gain
✓ Raised revenue guidance for the year, now expecting between $2.39 billion and $2.43 billion in FY'24
And yet... SOFI plunged more than 10%.
What gives?
We think the answer comes down to an even bigger question that investors are asking themselves right now: Is SoFi just another bank, or is it an actual digital wallet play of the future?
RECOMMENDED LINK During the Internet boom, companies like Pets.com were supposed to be promising investments riding the wave of a new tech boom. But then they were gone within a blink of an eye. One of the most successful investors in history just stepped forward to say the same thing is about to happen to AI stocks. Many of todayâs high-flying AI stocks are going to crash and burn like countless internet stocks did in 2000. (You may own some of these AI stocks right now.) If you want to avoid the carnage, please pay close attention to this important video. |
Choose Your Side Right now, SoFi's growth deceleration has investors wondering if it should really be labeled a "bank" and be valued as such.
Raised guidance is typically a âbest-caseâ earnings scenario, but in this case, it also sheds light on the stark slowdown in SoFiâs annual growth: 
Source: investors.sofi.com And as this X user points out, itâs this ârapid deceleration in growthâ thatâs raising red flags: 
The company's "uninspiring" call didn't help to quell fears about its growth prospects. 
And near term, itâs clear that even the "best quarter in the company's history" couldn't push its stock higher as Wall Street grows impatient. 
On the flip side, there are plenty of investors still in SoFiâs bullish camp â folks who are betting on the transformation of the company's target market expanding beyond student loans.
Folks like us who see SOFI as a winner in the future of banking.
RECOMMENDED LINK | On Wednesday, May 8, at 10 a.m., former Wall Street floor trader and market maker, Jonathan Rose, will reveal his #1 strategy for finding 100% gains in 30 days or less.
|
The Verdict Ultimately, only you can decide which side you stand on.
As for us, weâre still betting on SOFI becoming far more than just a bank and will treat these dips as opportunities to add shares. But we also acknowledge that the company needs to recover its user growth momentum and continue to execute on those users being more profitable than traditional banking customers.
Two "loyalty" tests are happening in parallel: - Is the SoFi customer actually loyal enough to be highly profitable for the platform down the road?
- And are SOFI shareholders loyal enough to take that bumpy ride to find out?
Our consumer data remains strong for SOFI â mentions are surging as much as 81% year over year as I write this, while Consumer Happiness has gained four points to nearly 80%.
Weâll be keeping a close eye on growth and the company's long-term vision from here.
Until next time, | 
