Q2 2025 Pagaya Technologies Ltd Earnings Call Transcript
Key Points
- Pagaya Technologies Ltd (PGY) reported a record high GAAP net income of $17 million for the second consecutive quarter.
- Total revenues reached a record $326 million, with $126 million from fee less production cost and $86 million in adjusted EBITDA.
- The company successfully raised $500 million through its first corporate bond issuance, reducing its cost of debt and enhancing cash flow.
- Pagaya's unique data and AI underwriting advantages continue to improve credit decision-making and outcomes for lending partners.
- The company has diversified its platform, with 30% of originations now coming from point-of-sale and auto lending, up from 9% a year ago.
- The onboarding process for new banking partners is lengthy, taking six to nine months due to rigorous compliance and integration requirements.
- Despite strong results, the company remains cautious due to macroeconomic uncertainties and is deliberately conservative in managing volumes and credits.
- Core operating expenses have risen sequentially due to higher ABS issuances, although they are expected to normalize next quarter.
- The company faces challenges in integrating new partners due to limited technology resources and competing internal priorities at partner institutions.
- Pagaya's growth strategy requires significant investment in new products and marketing capabilities, which may impact short-term profitability.
Good day, everyone, and welcome to today's Pagaya 2Q 2025 earnings call. (Operator Instructions) Please note this call is being recorded. (Operator Instructions) It is now my pleasure to turn the conference over to Josh Fagen, Head of IR.
Thank you and welcome to Pegaya's second-quarter 2025 earnings conference call. Joining me today to talk about our business and results are Gal Krubiner, Chief Executive Officer of Pagaya; Sanjeev Das, President; and Evangelos Perros, Chief Financial Officer. You can find the materials that accompany our prepared remarks and a replay of today's webcast on the Investor Relations section of our website at investor.pagaya.com.
Our remarks today will include forward-looking statements that are based on our current expectations and forecasts with respect to, among other things, our operations and financial performance, including our financial outlook for the third quarter and full year of 2025.
Our actual results may differ materially from those
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