NerdWallet and SoFi Earnings Blunt FinTech IPO Gains as Index Adds 1.4%

A spate of earnings reports rolled in through the past week, and a rough parity between gaining stocks and decliners held the FinTech IPO Index to a 1.4% gain.

NerdWallet shares plunged 30% through the past five sessions. In the company’s most recent earnings report, the firm said that first-quarter revenues were $170 million, up 31% year-over-year. Credit cards revenue of $61.3 million grew 36% year-over-year, offset by loan revenue of $22 million was down 36% year-over-year as demand for mortgages and student loans declined. The company’s earnings materials show that NerdWallet had 23 million average monthly unique users, up 7% year on year.

In the company’s shareholder letter detailing results, Tim Chen, CEO, said that, with respect to credit cards, “what was previously a cautious environment in sub- and near-prime underwriting is spilling into prime as well, as banks approach the second-order impacts of regional bank failures with caution.”

Elsewhere, SoFi’s shares were down 19% through the week. The company’s latest quarterly results show that demand for personal loans continues to increase.

Earnings materials show that the company added 433,000 members during the quarter, bringing the total membership base to 5.7 million, up 46% year on year. The company said its personal loan originations were up 46% to nearly $3 billion.

SoFi Weighs In

SoFi CEO Anthony Noto said, “more than 90% of our consumer deposits are from sticky direct deposit members, and 97% of our deposits are insured.”

Noto said that more than 50% of newly funded SoFi money accounts are setting up direct deposit by day 30, significantly impacting spending.

nCino shares slipped 13.4%. The company said it had partnered with digital bank Grasshopper. Under the terms of the agreement, Grasshopper will leverage multiple nCino solutions, including Portfolio Analytics, Commercial Banking and Customer Engagement, to enhance portfolio management and reporting and speed to market for loan closing, among other activities.

Alkami released first-quarter results detailing that SaaS subscription services grew to $57.5 million from $42.8 million last year.

Management commentary noted that during the quarter, the company crossed the 15 million digital banking user mark and exited the quarter with 15.1 million digital banking users on the Alkami platform, 18% higher than the year-ago quarter, per the company release.

Shares were down 3.9%.

Some Gainers Too

MoneyLion shares gained 34.7%. According to reports from  TechinAsia.com, MoneyLion is no longer partnering with Japanese conglomerate Aeon to launch a digital Islamic bank in Malaysia. The reports stated that MoneyLion decided to pull out of the consortium to focus on its US operations.

KE Holding shares were up 3.4% through the week.

The company late last month filed its latest annual report. In that filing, the company detailed that revenues decreased by 24.9% to RMB60.7 billion in 2022 (US$8.8 billion) from a year ago. In 2022, the company facilitated approximately 3.8 million housing transactions on its platform and generated a GTV of RMB2,609.6 billion (US$378.4 billion) in aggregate, decreasing from over 4.5 million housing transactions and a GTV of RMB3,853.5 billion in 2021.