Online lender Social Finance (SoFi) continues to struggle, recording an adjusted loss of around $12 million during the third quarter before interest, taxes, depreciation and amortization. The FinTech company has now recorded losses for the second consecutive quarter. In August, it posted a second quarter loss of about $200 million.
According to The Wall Street Journal (WSJ), the earnings losses follow an adjusted profit of $56 million in Q3 of 2017. Loan volume has fallen for two straight quarters under Anthony Noto, who took over as CEO in March. In fact, the company revealed in an investor letter that it had extended around $2.5 billion in refinanced student, unsecured consumer and mortgage loans in the third quarter, falling nearly 30 percent from the same period a year ago.
Due to a tougher lending environment, Noto said he is trying to make SoFi’s lending business more efficient, while also expanding into areas like banking and investing.
“We optimized for investing over profitability this quarter, and expect this to continue, given the opportunity in front of us,” Noto wrote in the letter, adding that SoFi is focusing on loan quality over volume.
This past May, Noto penned his first quarterly missive to shareholders, highlighting the company’s mission and values. Noto used the letter to identify key milestones, such as the SoFi at Work program, which partners with companies to help employees pay down their student loans and other debt. He added that SoFi plans to expand its robo-advisory services to offer individual stocks and other investment asset classes.
As for the values of the company, Noto said SoFi has created a set of 11 values, which include the embrace of diversity, taking care of other people and helping people grow. “We have changed the leadership team to set the example amongst their teams, and to help us devise the programs and practices that will reinforce these values in our everyday life at the company,” Noto wrote.