Figure Technology Solutions, Inc. (FIGR)
SIC breadcrumb: Finance, Insurance, And Real Estate > SIC Major Group 61 > SIC 6163 Loan Brokers
SEC company page: https://www.sec.gov/edgar/browse/?CIK=2064124. Latest filing source: 0002064124-26-000009.
Selected Fundamentals
| Metric | Value | Unit | FY | Filed |
|---|---|---|---|---|
| Revenue | 506,865,000 | USD | 2025 | 2026-03-16 |
| Net income | 133,858,000 | USD | 2025 | 2026-03-16 |
| Assets | 2,317,523,000 | USD | 2025 | 2026-03-16 |
Financials
Annual standardized facts from SEC companyfacts as of latest extracted filing date 2026-03-16. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0002064124.json. Derived margins, ratios, and free cash flow are computed from the extracted annual SEC facts.
| Metric | 2023 | 2024 | 2025 |
|---|---|---|---|
| Revenue | 209,549,000 | 340,885,000 | 506,865,000 |
| Net income | -47,935,000 | 17,214,000 | 133,858,000 |
| Operating income | -49,438,000 | 9,235,000 | 117,527,000 |
| Diluted EPS | -0.93 | 0.00 | 0.44 |
| Operating cash flow | -33,352,000 | -127,012,000 | 62,568,000 |
| Share buybacks | 0.00 | 1,001,000 | 0.00 |
| Assets | 1,159,578,000 | 2,317,523,000 | |
| Liabilities | 796,203,000 | 1,080,325,000 | |
| Stockholders' equity | 355,098,000 | 1,228,834,000 | |
| Cash and cash equivalents | 289,670,000 | 1,198,141,000 |
Ratios
| Metric | 2023 | 2024 | 2025 |
|---|---|---|---|
| Net margin | -22.88% | 5.05% | 26.41% |
| Operating margin | -23.59% | 2.71% | 23.19% |
| Return on equity | 4.85% | 10.89% | |
| Return on assets | 1.48% | 5.78% | |
| Liabilities / equity | 2.24 | 0.88 | |
| Current ratio | 1.37 | 2.20 |
Financial Charts
Quarterly
Quarterly standardized facts from SEC companyfacts as of latest extracted filing date 2026-05-15. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0002064124.json.
| Quarter | End Date | Revenue | Net Income | Diluted EPS | Method |
|---|---|---|---|---|---|
| 2025-Q3 | 2025-09-30 | 156,365,000 | 89,576,000 | 0.34 | reported discrete quarter |
| 2025-Q4 | 2025-12-31 | 159,913,000 | 15,160,000 | derived Q4 = FY annual - nine-month YTD | |
| 2026-Q1 | 2026-03-31 | 167,007,000 | 44,945,000 | 0.18 | reported discrete quarter |
Quarterly Charts
Macro Cross-References
- CPIAUCSL - Consumer Price Index for All Urban Consumers: All Items in U.S. City Average
- UNRATE - Unemployment Rate
- FEDFUNDS - Federal Funds Effective Rate
- CES0500000003 - Average Hourly Earnings of All Employees, Total Private
- DFEDTARU - Federal Funds Target Range - Upper Limit
- DFEDTARL - Federal Funds Target Range - Lower Limit
- DGS3MO - Market Yield on U.S. Treasury Securities at 3-Month Constant Maturity
- DGS2 - Market Yield on U.S. Treasury Securities at 2-Year Constant Maturity
- DGS10 - Market Yield on U.S. Treasury Securities at 10-Year Constant Maturity
- DGS30 - Market Yield on U.S. Treasury Securities at 30-Year Constant Maturity
- T10Y2Y - 10-Year Treasury Constant Maturity Minus 2-Year Treasury Constant Maturity
- CPILFESL - Consumer Price Index for All Urban Consumers: All Items Less Food and Energy
- CPIUFDSL - Consumer Price Index for All Urban Consumers: Food
- CPIENGSL - Consumer Price Index for All Urban Consumers: Energy
- CUSR0000SAH1 - Consumer Price Index for All Urban Consumers: Shelter
- PCEPI - Personal Consumption Expenditures: Chain-type Price Index
- PCEPILFE - Personal Consumption Expenditures Excluding Food and Energy: Chain-type Price Index
- PPIACO - Producer Price Index by Commodity: All Commodities
- T10YIE - 10-Year Breakeven Inflation Rate
- U6RATE - Total Unemployed, Plus All Marginally Attached Workers Plus Total Employed Part Time for Economic Reasons
- PAYEMS - All Employees, Total Nonfarm
- CIVPART - Labor Force Participation Rate
- EMRATIO - Employment-Population Ratio
- UNEMPLOY - Unemployed
- CE16OV - Employment Level
- ICSA - Initial Claims
- JTSJOL - Job Openings: Total Nonfarm
- JTSQUR - Quits: Total Nonfarm
- GDPC1 - Real Gross Domestic Product
- A191RL1Q225SBEA - Real Gross Domestic Product: Percent Change from Preceding Period
- INDPRO - Industrial Production: Total Index
- TCU - Capacity Utilization: Total Index
- HOUST - New Privately-Owned Housing Units Started: Total Units
- PERMIT - New Privately-Owned Housing Units Authorized in Permit-Issuing Places: Total Units
- RSAFS - Advance Retail Sales: Retail Trade
- PCE - Personal Consumption Expenditures
- DSPIC96 - Real Disposable Personal Income
- PSAVERT - Personal Saving Rate
- M2SL - M2
- BOPGSTB - U.S. International Trade in Goods and Services: Balance
- MSPUS - Median Sales Price of Houses Sold for the United States
- HSN1F - New One Family Houses Sold: United States
- RHORUSQ156N - Homeownership Rate in the United States
- TTLCONS - Total Construction Spending: Total Construction in the United States
- RRVRUSQ156N - Rental Vacancy Rate in the United States
- TOTALSL - Total Consumer Credit Owned and Securitized
- REVOLSL - Revolving Consumer Credit Owned and Securitized
- DRCCLACBS - Delinquency Rate on Credit Card Loans, All Commercial Banks
- GDP - Gross Domestic Product
- GPDI - Gross Private Domestic Investment
- GCE - Government Consumption Expenditures and Gross Investment
- PCEC - Personal Consumption Expenditures
- NETEXP - Net Exports of Goods and Services
- GFDEBTN - Federal Debt: Total Public Debt
- GFDEGDQ188S - Federal Debt: Total Public Debt as Percent of Gross Domestic Product
- FYFSD - Federal Surplus or Deficit
- FGRECPT - Federal Government Current Receipts
- FGEXPND - Federal Government: Current Expenditures
- MANEMP - All Employees, Manufacturing
- USCONS - All Employees, Construction
- USTRADE - All Employees, Retail Trade
- USFIRE - All Employees, Financial Activities
- USGOVT - All Employees, Government
- AWHAETP - Average Weekly Hours of All Employees, Total Private
- DGORDER - Manufacturers' New Orders: Durable Goods
- NEWORDER - Manufacturers' New Orders: Nondefense Capital Goods Excluding Aircraft
- BUSINV - Total Business Inventories
- EXPGS - Exports of Goods and Services
- IMPGS - Imports of Goods and Services
- IR - Import Price Index (End Use): All Commodities
- PPIFIS - Producer Price Index by Commodity: Final Demand
Latest quarter (10-Q)
Latest 10-Q source: 0002064124-26-000029.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
You should read the following discussion and analysis of our financial condition and results of operations together with our unaudited Condensed Consolidated Financial Statements and the related notes appearing elsewhere in this Quarterly Report on Form 10-Q, as well as our audited consolidated financial statements and related notes as disclosed in our Annual Report on Form 10-K for the year ended December 31, 2025, filed with the SEC on March 16, 2026 (the “2025 Form 10-K”). Some of the information contained in this discussion and analysis or set forth elsewhere in this Quarterly Report, including information with respect to our plans and strategy for our business, includes forward-looking statements that involve risks and uncertainties. You should read the section titled “Special Note Regarding Forward-Looking Statements” in this Quarterly Report and “Risk Factors” in our 2025 Form 10-K for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis. U.S. Dollars appearing in tables are presented in thousands unless otherwise indicated.
Business Overview
Figure is building the future of capital markets using blockchain-based technology. Financial services have historically been and are still trust-based markets, which require intermediation. Large institutional companies have been built around this. Blockchain-based technology has the power to distill these multi-party marketplaces down to just two: buyer and seller.
Blockchain can do more than disrupt existing markets. By taking historically illiquid assets, such as loans, and putting these assets and their performance history on-chain, blockchain is able to bring liquidity to historically static markets. That liquidity, coupled with the ability to achieve true digital perfection and control, opens previously inaccessible financing opportunities that were not accessible before.
We believe there are three core benefits blockchain delivers to the capital markets. The first is transactional: the reduction of audit, quality control, third-party review and other expenses. The second is liquidity: the ability to support 24x7, real-time bilateral marketplaces. The third is financing: the democratization of capital access through programmable smart contracts that enable peer-to-peer funding and real time loan perfection.
Figure’s proprietary technology powers next-generation lending, trading and investing activities in areas such as consumer credit and digital assets. Our application of the blockchain ledger allows us to better serve our end-customers, increase speed and efficiency, and enhance standardization and liquidity. Using our technology, we continue to develop dynamic, vertically-integrated marketplaces.
Recent Developments
OPEN Launch
In February 2026, we launched the On-Chain Public Equity Network (“OPEN”), a blockchain-based network designed to modernize the underlying infrastructure that supports the issuance, trading, custody and lending of public equity securities.
OPEN enables companies to issue their equity natively on the Provenance Blockchain and make it available for secondary market trading on our ATS. OPEN is designed to reduce reliance on traditional centralized market infrastructure and to provide new capabilities for public companies and shareholders. These capabilities are anticipated to include lower costs and capital requirements compared to existing clearing and settlement models, greater access to trading through self-custody and self-settlement mechanisms that can reduce the need for custodial intermediaries, and portfolio margining across digital and tokenized assets.
We support frictionless two-way exchangeability between our securities issued on OPEN and our listed Class A common stock, a capability that we expect to make available to future OPEN issuers. This exchangeability is intended to promote liquidity and prices near par between blockchain securities and securities listed on national market exchanges.
Blockchain Common Stock Offering
In February 2026, the Company successfully completed a secondary public offering of 4,375,000 shares of its Series A Blockchain Common Stock ("Blockchain Stock"). The selling stockholders in the offering agreed to sell 4,687,500 shares of Class A common stock to the underwriters. The Company did not raise proceeds through this offering. In conjunction
40
Table of Contents
with the offering, the Company repurchased 312,500 of our Class A common stock, subsequently held in treasury, that were subject to the offering at an aggregate amount of approximately $10 million at $32.00 per share.
The Blockchain Stock is a new class of equity security that trades exclusively on the Company’s ATS, allowing for trading 24 hours per day, 7 days per week. The Blockchain Stock provides the ability for holders to lend their stock transparently and utilize cross-asset collateralization through DeFi protocols. The offering served as the foundational launch of OPEN.
Share Repurchase Program
On February 25, 2026, the Company’s Board of Directors authorized a Share Repurchase Program under which the Company may repurchase up to $200 million of its Class A common stock and Blockchain common stock over the next 12 months subject to market conditions, contractual restrictions and other factors.
Repurchases under the Share Repurchase Program may be made from time to time in the open market, through privately negotiated transactions, accelerated share repurchase transactions, or by other means in accordance with applicable securities laws and regulations. The timing, number of shares repurchased, and prices paid will depend on market conditions, share price, trading volume, corporate considerations, and other factors. Open market repurchases will be structured to occur within the pricing and volume requirements of Rule 10b-18. The Company may also, from time to time, enter into Rule 10b5-1 plans to facilitate repurchases of its shares under this authorization.
This Share Repurchase Program does not obligate the Company to acquire any particular amount of stock and the program may be extended, modified, suspended or discontinued at any time at the Company’s discretion.
Key Operating Metrics
We review several key performance measures, discussed below, to evaluate our business and results, measure performance, identify trends, formulate plans, and make strategic decisions. We believe that the presentation of such metrics is useful to our investors and counterparties because they are used to measure and model the performance of companies similar to us using similar metrics.
The following tables set forth key performance measures that we use to evaluate our business for the three months ended March 31, 2026 and 2025:
Three Months Ended March 31,
(In thousands, except percentages)
2026
2025
Ecosystem volume(1):
$
3,720,418
$
1,577,710
Consumer loan marketplace volume(2):
2,902,378
1,365,136
Partner-branded volume(3)
2,265,341
1,045,059
Figure-branded volume(4)
637,037
320,077
Digital asset marketplace volume(5)
818,040
212,574
Figure connect volume(6)
1,611,840
477,904
Net take rate(7)
3.8
%
3.6
%
Net revenue
167,007
84,510
Net income (loss)
45,047
(613)
Adjusted net revenue(8)
166,843
86,982
Adjusted EBITDA(8)
82,696
28,344
_______________
(1)Ecosystem Volume consists of Consumer Loan Marketplace Volume and Digital Asset Marketplace Volume.
(2)We define Consumer Loan Marketplace Volume as the total U.S. dollar equivalent value of originations of HELOCs, DSCR, and personal loans on our LOS, as well as the volume of third-party loans traded on Figure Connect. We believe this measure is an indication of our scale and represents a potential revenue opportunity from the technology used for consumer credit loan originations.
(3)We define Partner-branded Volume as the total U.S. dollar equivalent value of loans originated using our LOS under our partners’ brands. Partner-branded volume is inclusive of Figure Connect Volume.
(4)We define Figure-branded Volume as the total U.S. dollar equivalent value of loans originated using our LOS under our brand.
(5)We define Digital Asset Marketplace Volume as the total U.S. dollar equivalent value of matched trades transacted between a buyer and seller through Figure Exchange. We believe this measure is an indication of our scale and represents a potential opportunity for our digital asset offering.
(6)We define Figure Connect Volume as the total U.S. dollar equivalent value of Consumer Loan Marketplace Volume originated by third-party sellers through our Figure Connect marketplace. We believe this measure is a reflection of the underlying growth of our Figure Connect ecosystem.
(7)Net Take Rate is derived from the sum of ecosystem and technology fees, origination fees, gain on sale of loans, net and gain on servicing asset, net from our Condensed Consolidated Statements of Operations. These items represent revenue generated from Figure-branded and Partner-branded
41
Table of Contents
volume. Valuation changes in fair value of mortgage servicing rights, which we believe are not indicative of operating performance, and marketing expenses in our operating expenses are deducted. This net amount is divided by overall consumer loan marketplace volume for that period.
(8)For definitions of Adjusted Net Revenue and Adjusted EBITDA and reconciliations to our most directly comparable financial measures calculated and presented in accordance with GAAP, see “—Non-GAAP Financial Measures.”
As of
(In thousands)
March 31, 2026
March 31, 2025
YLDS in circulation(1):
$
598,047
$
2,700
Democratized Prime:
Matched offers balance(2)
367,932
n.m.
Borrower demand(3)
376,429
n.m.
Available lender supply(4)
452,778
n.m.
_______________
(1)We define YLDS in Circulation as the total U.S. dollar equivalent value of unsecured face-amount certificates solely backed by the assets of Figure Certificate Company (FCC), which is the issuer of the certificates.
(2)We define Matched Offers as the U.S. dollar equivalent value of offers matched between borrower and lenders on the Democratized Prime platform.
(3)We define Borrower Demand as the U.S. dollar equivalent value that borrowers seek to borrow from the lending pool on the Democratized Prime platform.
(4)We define Lender Supply as the U.S. dollar equivalent value that lenders have made available in the lending pool on the Democratized Prime platform.
Trends and Other Factors Affecting Our Performance
We believe our performance depends, and will in the future depend, on many factors, including those described in Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations of our 2025 Form 10-K, to which there have been no material changes.
Loan Characteristics
The following table sets forth the weighted-average characteristics of loans we originated or purchased for the three months ended March 31, 2026 and 2025:
Three Months Ended March 31,
2026
2025
HELOC Loans(1):
Partner-branded:
Loan term (in months)
295
309
Customer interest rate
8.7
%
9.8
%
Customer FICO score
754
756
Loan balance (in thousands)
$
98
$
95
Figure-branded:
Loan term (in months)
294
296
Customer interest rate
8.4
%
9.6
%
Customer FICO score
750
748
Loan balance (in thousands)
$
101
$
85
(1)HELOC loans subject to monthly, amortizing borrower payments and may be prepaid and redrawn within a limited period of time. Personal, mortgage, and other loans are not considered significant.
The following table summarizes loan counts held by the Company at March 31, 2026 and December 31, 2025:
March 31, 2026
D
[Excerpt truncated for page length; source filing is linked above.]
Latest 10-K MD&A
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
You should read the following discussion and analysis of our financial condition and results of operations together with our Consolidated Financial Statements and the related notes appearing elsewhere in this Annual Report on Form 10-K. Some of the information contained in this discussion and analysis or set forth elsewhere in this Annual Report on Form 10-K, including information with respect to our plans and strategy for our business, includes forward-looking statements that involve risks and uncertainties. You should read the sections titled “Risk Factors” and “Special Note Regarding Forward-Looking Statements” for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis. U.S. Dollars appearing in tables are presented in thousands unless otherwise indicated. A discussion of our financial condition and results of operations for the year ended December 31, 2024 compared to the year ended December 31, 2023 is included in our final prospectus dated September 10, 2025, filed with the SEC on September 11, 2025 pursuant to Rule 424(b) of the Securities Act (the “Prospectus”), under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations”.
100
Table of Contents
Executive Overview
Figure is building the future of capital markets using blockchain-based technology. Financial services have historically been and are still trust-based markets, which require intermediation. Large institutional companies have been built around this. Blockchain-based technology has the power to distill these multi-party marketplaces down to just two: buyer and seller.
Blockchain can do more than disrupt existing markets. By taking historically illiquid assets, such as loans, and putting these assets and their performance history on-chain, blockchain can bring liquidity to markets that have never had such. That liquidity, coupled with the ability to achieve true digital perfection and control, opens financing opportunities that were not accessible before.
We believe in three core benefits blockchain delivers to the capital markets. The first is transactional: the reduction of audit, quality control, third-party review and other expenses. The second is liquidity: the ability to support 24x7, real-time bilateral marketplaces. The third is financing: the democratization of capital access through programmable smart contracts that enable peer-to-peer funding and real time loan perfection.
Figure’s proprietary technology powers next-generation lending, trading and investing activities in areas such as consumer credit and digital assets. Our application of the blockchain ledger allows us to better serve our end-customers, improve speed and efficiency, and enhance standardization and liquidity. Using our technology, we continue to develop dynamic, vertically-integrated marketplaces.
Recent Developments
Reorganization
Prior to a change in corporate structure on March 18, 2024, the consolidated financial statements were under the former parent company, Figure Technologies, Inc. ("FT"). On March 18, 2024, FT, FT Intermediate, Inc. (“FTI”), and Figure Markets Holdings, Inc. (“FMH”) and other entities under common control consummated a reorganization (the “Reorganization”) whereby FT contributed assets and liabilities to FTI and subsequently, FT consummated a reverse merger with a subsidiary of FTI. Each outstanding share of common stock of FT converted into one share of common stock of FTI, whereby FTI (a) contributed assets and liabilities applicable to the FMH business and (b) 100% of the equity interest to FT's successor. FT then ratably distributed 74.1% of FMHs' common stock to third-party shareholders and 25.9% to related parties in exchange for their FTI common stock.
As a result of the Reorganization, there were two affiliated corporations under common control. Each of the following two corporations was owned either directly or indirectly by its controlling shareholder, Michael Cagney (“Controlling Party”):
•FTI was formed on March 18, 2024 as a Delaware corporation and primarily operates through its wholly-owned subsidiary, Figure Lending Corp. (“Lending”). Lending offers Figure Connect which generates ecosystem and technology fees, and originates, sells, and securitizes home equity line of credit (“HELOC”) loans that it services.
•FMH was formed on January 25, 2024 as a Delaware corporation. FMH utilized blockchain technology to develop an exchange for digital assets and credit, with new product offerings including providing interest-bearing stablecoin deposits.
In May 2025, both FTS and FMH redomiciled from the State of Delaware to the State of Nevada.
Recombination
On August 29, 2025 (“Recombination Date”), FTI and FMH recombined the businesses through a series of transactions (the “Recombination”) and FMH became a wholly-owned subsidiary of FTI. Approximately five outstanding shares of FMH common or preferred stock, options, or warrants converted into one share of common or preferred stock, options, or warrants of FTI (“Conversion Rate”). Upon the consummation of the Recombination, FTI changed its name to Figure Technology Solutions, Inc.
The Recombination was a reorganization of entities under common control as FTI and FMH were owned, either directly or indirectly, by the Controlling Party before and after the Recombination. As a result, the Recombination is accounted for in a manner similar to a pooling of interests with the assets and liabilities of the parties to the Recombination carried over at their historical amounts. Therefore, the accompanying Consolidated Financial Statements have been retrospectively recast to reflect the results as if FTI and FMH were a single consolidated entity as of the earliest period presented.
101
Table of Contents
IPO
On September 12, 2025, the Company completed its IPO, in which the Company issued and sold 36,225,000 shares of its Class A common stock, including the underwriters’ over-allotment option which was exercised in full, at a public offering price of $25.00 per share. The IPO resulted in net proceeds to the Company of $663.4 million after deducting the underwriting discounts and commissions.
In connection with the IPO, all shares of outstanding convertible preferred stock, including 2,010,410 shares of Series E preferred stock issued upon the exercise of outstanding warrants, automatically converted to 113,910,905 shares of Class A common stock, and a total of 39,393,047 shares of our Class A common stock held by the Controlling Party and his permitted transferees were converted into an equivalent number of shares of Class B common stock, of which 1,500,000 shares were subsequently converted back to Class A and sold in connection with the IPO.
OPEN Launch
In February 2026, we launched On-Chain Public Equity Network (“OPEN”), a blockchain-based network designed to modernize the infrastructure that supports the issuance, trading, custody and lending of public equity securities.
OPEN enables companies to issue their equity natively on the Provenance Blockchain and make it available for secondary market trading on our ATS. OPEN is designed to reduce reliance on traditional centralized market infrastructure and provide new capabilities for public companies and shareholders. These capabilities are anticipated to include lower costs and capital requirements compared to existing clearing and settlement models, greater access to trading through self-custody and self-settlement mechanisms that can reduce the need for custodial intermediaries, portfolio margining across digital and tokenized assets.
We aim to support frictionless two-way exchangeability between our securities issued on OPEN and our listed Class A common stock, a capability that we expect to make available to future OPEN issuers. This exchangeability is intended to promote liquidity and prices near par between blockchain securities and securities listed on national exchanges.
Blockchain Common Stock Offering
In February 2026, the Company successfully completed a secondary public offering of 4,375,000 shares of its Series A Blockchain Common Stock ("Blockchain Stock"). The selling stockholders in the offering agreed to sell 4,687,500 shares of Class A common stock to the underwriters. The Company did not raise proceeds through this offering. In conjunction with the offering, the Company repurchased 312,500 of our Class A common stock, subsequently held in treasury, that were subject to the offering at an aggregate amount of approximately $10 million at $32.00 per share.
The Blockchain Stock is a new class of equity security that trades exclusively on the Company’s ATS, allowing for trading 24 hours per day, 7 days per week. The Blockchain Stock provides the ability for holders to lend their stock transparently and utilize cross-asset collateralization through DeFi protocols. The offering served as the foundational launch of OPEN.
Share Repurchase Program
On February 25, 2026, the Company’s Board of Directors authorized a share repurchase program under which the Company may repurchase up to $200 million of its Class A and Blockchain common stock over the next 12 months subject to market conditions, contractual restrictions and other factors.
Repurchases under the program may be made from time to time in the open market, through privately negotiated transactions, accelerated share repurchase transactions, or by other means in accordance with applicable securities laws and regulations. The timing, number of shares repurchased, and prices paid will depend on market conditions, share price, trading volume, corporate considerations, and other factors. Open market repurchases will be structured to occur within the pricing and volume requirements of Rule 10b-18. The Company may also, from time to time, enter into Rule 10b5-1 plans to facilitate repurchases of its shares under this authorization.
This program does not obligate the Company to acquire any particular amount of stock and the program may be extended, modified, suspended or discontinued at any time at the Company’s discretion.
Key Operating Metrics
We review several key performance measures, discussed below, to evaluate our business and results, measure performance, identify trends, formulate plans, and make strategic decisions. We believe that the presentation of such metrics is useful to
102
Table of Contents
our investors and counterparties because they are used to measure and model the performance of companies similar to us using similar metrics.
The following tables set forth key performance measures that we use to evaluate our business for the years ended December 31, 2025 and 2024:
Years Ended December 31,
2025
2024
Ecosystem volume(1):
$
9,087,631
$
5,879,147
Consumer loan marketplace volume(2):
8,377,133
5,128,460
Partner-branded volume(3)
6,401,396
3,447,331
Figure-branded volume(4)
1,975,737
1,681,129
Digital asset marketplace volume(5)
710,498
750,687
Figure connect volume(6)
3,842,222
8,144
Net revenue
$
506,865
$
340,885
Net income (loss)
134,281
19,915
Adjusted net revenue(7)
514,804
339,182
Adjusted EBITDA(7)
251,157
101,443
_______________
(1)Ecosystem Volume consists of Consumer Loan Marketplace Volume and Digital Asset Marketplace Volume.
(2)We define Consumer Loan Marketplace Volume as the total U.S. dollar equivalent value of originations of HELOCs, DSCR,and personal loans on our LOS, as well as the volume of third-party loans traded on Figure Connect. We believe this measure is an indication of our scale and represents a potential revenue opportunity from the technology used for consumer credit loan originations.
(3)We define Partner-branded Volume as the total U.S. dollar equivalent value of loans originated using our LOS under our partners’ brands. Partner-branded volume is inclusive of Figure Connect Volume.
(4)We define Figure-branded Volume as the total U.S. dollar equivalent value of loans originated using our LOS under our brand.
(5)We define Digital Asset Marketplace Volume as the total U.S. dollar equivalent value of matched trades transacted between a buyer and seller through Figure Exchange. We believe this measure is an indication of our scale and represents a potential opportunity for our digital asset offering.
(6)We define Figure Connect Volume as the total U.S. dollar equivalent value of Consumer Loan Marketplace Volume originated by third-party sellers through our Figure Connect marketplace. We believe this measure is a reflection of the underlying growth of our Figure Connect ecosystem.
(7)For definitions of Adjusted Net Revenue and Adjusted EBITDA and reconciliations to our most directly comparable financial measures calculated and presented in accordance with GAAP, see “—Non-GAAP Financial Measures.”
As of
December 31, 2025
December 31, 2024
YLDS in circulation(1):
$
328,193
$
—
Democratized Prime:
Matched offers balance(2)
206,101
n.m.
Borrower demand(3)
246,382
n.m.
Available lender supply(4)
213,096
n.m.
_______________
(1)We define YLDS in Circulation as the total U.S. dollar equivalent value of unsecured face-amount certificates solely backed by the assets of Figure Certificate Company (FCC), which is the issuer of the certificates.
(2)We define Matched Offers as the U.S. dollar equivalent value of offers matched between borrower and lenders on the Democratized Prime platform.
(3)We define Borrower Demand as the U.S. dollar equivalent value that borrowers seek to borrow from the lending pool on the Democratized Prime platform.
(4)We define Lender Supply as the U.S. dollar equivalent value that lenders have made available in the lending pool on the Democratized Prime platform.
Trends and Other Factors Affecting Our Performance
Market and Competitive Factors
Currently, our revenue is substantially derived from our HELOC product offering and from our LOS technology offering. The HELOC market is supported by positive trends across the housing market, largely from growing home equity balances and a mortgage borrower population that is characterized by low fixed-rate first lien mortgages, for which a cash-out refinancing is a less attractive alternative. Historically, consumers have primarily accessed home equity lending products through banks and other depository institutions, but in 2023, positive trends in the market landscape emerged as banks began to de-emphasize the product. Additionally, leading non-depository lenders that specialized in traditional mortgage products lacked the ability to effectively offer a consumer-friendly HELOC product to meet the demand of potential borrowers seeking to leverage their increased home equity value as a potential financing alternative. We believe the
103
Table of Contents
HELOC market will remain strong, as historically high housing values coupled with a historically low sales market have led consumers to search for ways to utilize the untapped equity in their homes. Figure continues to develop technology to provide its partners with solutions for any interest rate environment, and we expect the impact of rates on our business to decrease.
We expect to continue to see new entrants in the market because of the significant size of the potential market opportunity and a broadly underserved universe of potential borrowers in the HELOC market. This trend has continued recently, most notably with originators of agency mortgages entering the market as mortgage refinance activity slowed. However, many of these entrants have struggled to gain traction, which we believe is due to their lack of technology, product expertise and capital markets capabilities necessary to effectively participate. With our suite of products and solutions centered around the vision of promoting efficiency and liquidity in financial markets we feel we are uniquely positioned to provide the infrastructure to support an efficiently functioning HELOC market. This has been evidenced by our performance to date: in 2025, we were the leading originator of HELOCs among non-depository lenders, in addition to providing the technology to power other originators through our Partner-branded strategies.
Continued Expansion of our Ecosystem and Product Offerings
We continue to expand our product offerings through the release of new consumer lending products centered around the proven technology utilized in HELOC origination and entrance into the broader capital markets, including a marketplace that allows partners to trade and invest in products across multiple asset classes. In addition to our HELOC product, we provide technology platforms giving consumers exposure to a variety of assets in an efficient and secure way. We intend to continue broadening our network of partners that originate with Figure’s technology. While our current roster of partners includes many of the largest mortgage originators across the country, we believe that we have significant room to grow those relationships as we drive adoption across their sales force and engrain our technology in their core offerings. Additionally, we see a substantial opportunity to further expand the group of companies that we partner with as our technology offering would benefit a diverse constituency (including mortgage originators, banks, credit unions, mortgage servicers and other consumer lenders). Our relationship with our partners is based on our partners’ right to use our solutions. Once a partner is approved and onboarded, the partner enters into a contractual agreement with us for the right to use our LOS and Figure Connect marketplace in exchange for fees. These agreements typically have a fixed term with auto-renewals unless notice is given to terminate, are non-exclusive and do not obligate our partners to use our solutions. As we launch new products, we expect to generate significant momentum by capitalizing on our proven track record, reputation and to our established network of partners to support our ability to quickly scale in adjacent products.
Regulatory Environment
Our business is subject to regulations, which may expose us to significant regulatory risk and cause additional legal costs to ensure compliance. The existing legal framework that governs the financial markets is continuously reviewed and regularly amended, resulting in enforcement of new laws and regulations that apply to our business. The current regulatory environment in the United States may be subject to future legislative and regulatory changes driven by U.S. and global issues and priorities, including the recent change in U.S. administration and Congress, which may lead to material changes to existing laws, rules and regulations, guidance and enforcement stances. The impact of any changes in the legal or regulatory landscape on us and our operations remains uncertain. Compliance with regulations both now and in the future may require us to dedicate additional financial and operational resources, which may adversely affect our profitability. In addition, compliance with regulations may require our clients to dedicate significant financial and operational resources, which may negatively affect their ability to pay our fees and use our platforms and, as a result, our profitability. However, under certain circumstances regulation may increase demand for our platforms and solutions, and we believe we are well positioned to benefit from any potential increased digital transformation needs due to regulatory changes as market participants seek platforms that meet regulatory requirements and solutions that help them comply with their regulatory obligations. In recent years, we have also expended significant managerial, operational, and compliance costs to meet the legal and regulatory requirements applicable to us in the United States and other jurisdictions in which we operate. We expect to continue to incur costs to satisfy our legal and compliance obligations, which our unregulated or less regulated competitors have not had to and will not incur.
Technology and Cybersecurity Environment
Offering a secure, efficient technology platform is essential to maintaining our level of competitiveness in the market and attracting new partners and marketplace participants. We believe that the demand for our platform and services will increase with the introduction of new products. We plan to continue to focus on and invest in technology infrastructure initiatives and continually improve and expand our platform to further enhance our market position. We experience cyber-threats and attempted security breaches. If these were successful, these cybersecurity incidents could impact revenue and
104
Table of Contents
operating income and increase costs. We therefore continue to make investments to strengthen our cybersecurity infrastructure, which may result in increased costs.
Impact of Macroeconomic Cycles
Macroeconomic cycles can impact our financial performance and demand for our products. Consumer demand for loans, our partners’ willingness to originate new loans using our technology, investor appetite for credit-oriented investment opportunities, and credit performance can fluctuate in an economic slowdown. However, we believe the flexibility inherent in our platform will allow us to align our strategy with the market opportunity through cycles. Further, our technology-driven underwriting approach has proven effective, and our loans have demonstrated strong credit performance since inception.
Effects of Inflation
While inflation may impact our revenues and operating expenses, we believe the effects of inflation, if any, on our results of operations and financial condition have not been significant during the years ended December 31, 2025 and 2024. However, there can be no assurance that our results of operations will not be materially impacted by inflation in the future.
Loan Characteristics
The following table sets forth the weighted-average characteristics of loans we originated or purchased for the years ended December 31, 2025 and 2024:
Years Ended December 31,
2025
2024
HELOC Loans(1):
Partner-branded:
Loan Term (in months)
303
325
Customer Interest Rate
9.2
%
10.8
%
Customer FICO Score
755
753
Loan Balance
$
93
$
92
Figure-branded:
Loan Term (in months)
294
290
Customer Interest Rate
9.1
%
10.5
%
Customer FICO Score
748
740
Loan Balance
$
91
$
71
(1)HELOC loans subject to monthly, amortizing borrower payments and may be prepaid and redrawn within a limited period of time. Personal, mortgage, and other loans are not considered significant.
The following table summarizes loan counts held by the Company at December 31, 2025 and 2024:
Years Ended December 31,
2025
2024
Count of loans held for sale:
HELOC loans
6,455
4,582
Personal loans(1)
1,116
233
Other(2)
168
326
Total loan count held for sale
7,739
5,141
(1) Loans collateralized by digital assets.
(2) Primarily contains legacy mortgages and other unsecured loans.
Components of Results of Operation
Net Revenue
Our net revenue is primarily derived from ecosystem and technology fees, loan originations and sales, including interest income earned thereon, and loan servicing.
105
Table of Contents
Ecosystem and Technology Fees
Through our Partner-branded channel, we earn volume-based technology and processing fees, based on the principal balance of each loan originated on our LOS and the principal balance of loans transacted on Figure Connect. Such fees arise from contracts entered into with partners to provide access to a cloud-based lending marketplace platform that is developed by us. Our platform enables partners, who are retail and wholesale lenders, to originate loans branded under the partners’ name, by having access to a suite of services such as submission of loan applications, verifying information provided within submitted applications, risk underwriting, delivery of electronic loan offers, and electronic loan documentation signed by the borrower.
We also earn a fee for arranging and facilitating the securitization of HELOCs based on the outstanding principal balance of the transferred HELOCs, which is fully earned on the securitization closing date. Program fees are paid by the trust as the fees are earned and paid upon closing.
Origination Fees
Origination fees consist of the fees that we earn from originating loans upon the customer’s initial loan draw. Origination fees include loan origination fees and other fees collected from the customer at the time a loan is funded. Origination fees are currently calculated as a percentage of the customer’s initial loan balance and are recognized as revenue at a specified point in time, once a customer’s loan application has been approved, a credit decision has been reached, and the loan has been funded and processed. These fees are earned through both our Figure-branded channel as well as our Partner-branded channel through wholesale brokers.
Servicing Fees
Servicing fees and other revenue consist of the fees that we earn from managing loan portfolios on behalf of the owners of those portfolios. Servicing fees are calculated based on a contractual percentage of the outstanding principal under servicing arrangements and are charged monthly pursuant to our servicing agreements for activities we perform throughout the loan term, including collection, processing and reconciliations of payments received, investor reporting, and customer support. We act as servicer for the majority of the loans facilitated through our platform.
Gain on Sale of Loans, net
Gain on sale of loans consists of the net proceeds from the difference between the proceeds received at the sale of loans to third-party buyers, and the unpaid principal balance of such loans, including adjustments for changes in fair value for loans sold during the period. These realized and unrealized gains or losses and fair value adjustments are recognized through both our Figure-branded and Partner-branded channels based on the fair value of the loan originated by us, or purchased from partners, generally represented by the consideration paid relative to the loans’ estimated fair value at each quarter end or consideration received upon sale.
We have elected the fair value option for both the Figure-branded loans we originate as well as the Partner-branded loans we purchase from our partners that we hold for sale. Loans held for sale consist of loans we intend to sell, including HELOCs, personal loan products, and mortgage loans we previously originated or purchased. HELOCs and mortgage loans are secured by first or junior liens on customers’ real property. Any changes in fair value relating to loans held for sale are included in our results of operations as net fair value adjustments.
Interest Income
We earn interest income primarily from the following sources:
•Loans — We accrue interest income on loans we hold based on the UPB outstanding at contractual interest rates. We place loans on nonaccrual status when they become 90 days past due (30 days past due for collateralized personal loans) or when we doubt full recovery of interest and principal. Loans are considered past due when contractually required principal or interest payments have not been made on the due dates. When a loan is placed on nonaccrual status, the accrued and unpaid interest is reversed as a reduction of interest income and accrued interest receivable. Interest income is subsequently recognized only to the extent cash payments are received or when the loan has been placed back in accrual status. Loans are restored to accrual status when the loan becomes current and we expect repayment of the remaining contractual principal and interest. We also recognize cash received on non-accrual loans as interest income after all contractual principal is repaid.
106
Table of Contents
•Marketable Securities — We recognize interest income on the debt securities we hold where we expect to collect all contractual cash flows, and the debt security cannot be contractually prepaid in such a way that we would not recover substantially all of our recorded investment, based on the stated coupon rate and the outstanding principal amount of the debt security. We recognize interest income on beneficial interests based on the investment’s accretable yield, which represents the difference between the expected undiscounted cash flows and the carrying value of the investment. We recognize the accretable yield as interest income on a prospective level yield basis over the life of the expected cash flows. Changes in the amount or timing of actual or expected cash flows may change the accretable yield, and we adjust interest income recognized in future periods using a recalculated level yield applied to the then-current carrying value. Increases (decreases) in the amount of cash flows or acceleration (deceleration) of cash flows, in isolation, generally increase (decrease) the interest income recognized in future periods.
•Cash and Cash Equivalents — We accrue interest income monthly for cash held at depository institutions and investments in short-term instruments, such as money-market funds and U.S. Treasury Bills, and through repurchase agreements that are collateralized by U.S. Treasury Bills.
Gain on Servicing Asset, net
We routinely sell HELOCs, and in the past we have also sold personal loans, mortgage loans and Figure Pay credit loans, with servicing rights retained. Figure Pay credit loans are short duration, installment loans that consumers can use at their discretion. Loan servicing activities include account maintenance, collections, processing payments from customers, and distributions to third-party loan owners. During each reporting period, a servicing asset is recognized when the benefits of servicing are determined to be greater than adequate compensation for the servicing activities that we perform, and conversely, a servicing liability is recognized if the benefits of servicing are determined to be less than adequate compensation for the servicing activities that we perform. We carry servicing assets at fair value. Any changes in the fair value are included in our results of operations as net fair value adjustments. These gains are recognized through both our Figure-branded and Partner-branded channels.
Operating Expenses
Operating expenses consist of general and administrative, technology and product development, operations and processing, sales and marketing, and interest expenses.
General and Administrative
General and administrative expenses primarily consist of payroll and other personnel-related costs, including stock-based compensation, legal and compliance, finance and accounting, human resources and facilities teams, professional services fees, facilities, and travel expenses. We expect general and administrative expenses to increase in the near-term as we continue to grow our business as well as a result of our transition to being a public reporting company.
Technology and Product Development
Technology and product development expenses primarily consist of payroll and other personnel-related costs, including stock-based compensation, for our product, engineering, and design team, which is responsible for maintenance, bug fixes and software updates among others, as well as the costs of systems and tools used by these personnel. We expect technology and product development expenses to increase as we continue to grow our business and expand our product, engineering, and design teams as we continue to enhance and expand our technology and product offerings.
Operations and Processing
Operations and processing expenses primarily consist of payroll and other personnel-related costs, including stock-based compensation for personnel engaged in onboarding, loan servicing, customer support and other related operational teams. These expenses also include the costs of third-party systems and tools we use as part of the loan origination process, including information verification, fraud detection, and payment processing activities. We expect operations and processing expenses to increase as we continue to grow our business and expand our product offerings.
107
Table of Contents
Sales and Marketing
Sales and marketing expenses primarily consist of costs incurred across various advertising channels, including expenses associated with advertising campaigns, and building overall brand awareness. Sales and marketing expenses also include payroll and other personnel-related costs, including stock-based compensation expense, for our sales and marketing personnel.
Interest Expense
Interest expense consists of the costs we incur on our borrowings, amortization of fees, and other costs associated with our debt obligations. It also includes interest accrued and paid to holders of YLDS in the form of additional YLDS.
Other Expense
We have contractual agreements with loan buyers to repurchase loans under certain circumstances, including in the event of borrower delinquencies within the first 30 to 90 days of loan origination. We record a loss on those loans based on the fair value at the date on which we identify the repurchase obligation.
Other (expense) income, net
Other (expense) income, net includes unrealized and realized gains (losses) resulting from transactions of certain digital assets, litigation settlements, adjustments to non-equity method investments, foreign exchange rate gains (losses) and other non-income based state and local taxes.
Results of Operations
Consolidated Statements of Operations
The following table sets forth our Consolidated Statements of Operations for the periods presented:
Years Ended December 31,
Change
(In thousands, except percentages)
2025
2024
$
%
Net revenue:
Ecosystem and technology fees
$
120,808
$
28,314
$
92,494
326.7
%
Servicing fees
31,540
25,245
6,295
24.9
Interest income
74,810
48,207
26,603
55.2
Origination fees
72,536
64,867
7,669
11.8
Gain on sale of loans, net
180,024
140,353
39,671
28.3
Gain on servicing asset, net
24,567
32,637
(8,070)
(24.7)
Other revenue
2,580
1,262
1,318
104.4
Total net revenue
506,865
340,885
165,980
48.7
Expenses:
General and administrative
131,971
104,251
27,720
26.6
Technology and product development
64,922
62,657
2,265
3.6
Operations and processing
65,056
44,452
20,604
46.4
Sales and marketing
76,094
55,657
20,437
36.7
Interest expense
48,870
56,415
(7,545)
(13.4)
Other expense
2,425
8,218
(5,793)
(70.5)
Total expenses
389,338
331,650
57,688
17.4
Operating income
117,527
9,235
108,292
1172.6
Other (expense) income, net
(3,852)
12,857
(16,709)
n.m.
Income before income taxes
113,675
22,092
91,583
414.6
Income tax (benefit) provision
(20,606)
2,177
(22,783)
n.m.
Net income
134,281
19,915
114,366
574.3
Net income (loss) attributable to noncontrolling interests in consolidated subsidiaries
423
2,701
(2,278)
(84.3)
Net income attributable to Figure Technology Solutions, Inc.
$
133,858
$
17,214
$
116,644
677.6
%
108
Table of Contents
Net Revenue
Ecosystem and technology fees
Years Ended December 31,
Change
(In thousands, except percentages)
2025
2024
$
%
Technology offering fees
$
50,646
$
20,188
$
30,458
150.9
%
Ecosystem fees
56,817
122
56,695
46471.3
Program fees
13,345
8,004
5,341
66.7
Total ecosystem and technology fees
$
120,808
$
28,314
$
92,494
326.7
%
Ecosystem and technology fees
Ecosystem and technology fees increased $92.5 million, or 326.7%, primarily due to the growth in Figure Connect Volume, as well as a $5.3 million increase in program fees due to an $1.2 billion increase in the volume of securitizations for which we earn program fees.
Servicing fees
Servicing fees increased $6.3 million, or 24.9%, due to a $4.8 billion, or 59.7%, increase in the weighted-average servicing portfolio unpaid principal HELOC loan balance of $12.9 billion serviced at December 31, 2025, compared to $8.1 billion at December 31, 2024, partially offset by a decrease of 3 basis points in the weighted average servicing fee rate from 34 basis points to 31 basis points.
Interest income
Interest income increased $26.6 million, or 55.2%, when comparing the year ended December 31, 2025 to the year ended December 31, 2024, primarily due to an $15.0 million increase in interest earned on marketable securities held as we have progressively securitized loans on our platform and retained certain interests, in addition to a $7.4 million increase in interest earned on cash balances, and a $2.5 million increase in interest earned on HELOC and personal loans we hold.
Origination fees
Net origination fees increased $7.7 million or 11.8%, primarily due to a 17.5% increase in Figure-branded volume over the period.
Gain on sale of loans, net
Years Ended December 31,
Change
(In thousands, except percentages)
2025
2024
$
%
Realized gain (loss):
Whole loan sales
$
144,549
$
105,470
$
39,079
37.1
%
Securitized loans
37,911
21,128
16,783
79.4
Derivatives
(6,292)
52
(6,344)
n.m.
176,168
126,650
49,518
39.1
Unrealized gain (loss):
Loans
2,118
10,665
(8,547)
(80.1)
Marketable securities
1,625
2,708
(1,083)
(40.0)
Derivatives
113
330
(217)
(65.8)
3,856
13,703
(9,847)
(71.9)
Total gain on sale of loans, net
$
180,024
$
140,353
$
39,671
28.3
%
Gain on sale of loans increased $39.7 million, or 28.3%, as a result of an increase of $55.9 million in the total realized gains on loans due to a 39.7% increase in the weighted average price of loans sold, in addition to an increase in the UPB of loans sold from $4.8 billion to $6.1 billion for the years ended December 31, 2024 and 2025, respectively. The decrease in unrealized gains were primarily due to a $8.5 million decrease in the fair value of loans not yet sold as a result of less HELOC loans held on our balance sheet for the year ended December 31, 2025. Due to changes in rates impacting our derivatives, we recognized realized losses on derivatives of $6.3 million and an unrealized gains of $0.1 million for the year ended December 31, 2025.
109
Table of Contents
Gain on servicing asset, net
Years Ended December 31,
Change
(In thousands, except percentages)
2025
2024
$
%
Additions
$
60,713
$
50,557
$
10,156
20.1
%
Realization of cash flows
(28,207)
(19,623)
(8,584)
43.7
Change in valuation inputs and assumptions
(7,939)
1,703
(9,642)
n.m.
Total gain on servicing asset, net
$
24,567
$
32,637
$
(8,070)
(24.7)
%
Gain on servicing asset, net decreased $8.1 million, or 24.7%, primarily due to a $9.6 million decrease resulting from changes in valuation inputs and assumptions, which was impacted by a decrease in the weighted average servicing fee rate from 34 to 31 basis points. In addition, there was an $8.6 million change due to the realization of cash flows derived from a larger servicing portfolio during the year ended December 31, 2025 compared to the year ended December 31, 2024. The decreases are offset by a $10.2 million increase in new servicing assets retained on the increase of UPB of loans sold from $4.8 billion to $6.1 billion for the year ended December 31, 2025 compared to the year ended December 31, 2024.
Other revenue
Other revenue is immaterial overall and components of other revenue did not materially change as fees, and the net assets on which we charge those fees, were consistent during the years ended December 31, 2025 and 2024.
Figure-branded revenue
Years Ended December 31,
Change
(In thousands, except percentages)
2025
2024
$
%
Ecosystem and technology fees
$
3,137
$
2,494
$
643
25.8
%
Origination fees
65,507
57,039
8,468
14.8
Gain on sale of loans, net
66,168
46,269
19,899
43.0
Total Figure-branded net revenue
$
134,812
$
105,802
$
29,010
27.4
%
Figure-branded net revenue increased $29.0 million, or 27.4% during the year ended December 31, 2025, compared to the year ended December 31, 2024. This was primarily due to a $19.9 million, or 43.0% increase in gain on sale of loans, net, during the year ended December 31, 2025, compared to the year ended December 31, 2024, as a result of an increase in the weighted average price of loans sold, in addition to an increase in the UPB of loans sold. Figure-branded origination fees increased by $8.5 million, or 14.8%, during the year ended December 31, 2025, compared to the year ended December 31, 2024, as a result of a 17.5% increase in Figure-branded volume.
Partner-branded revenue
Years Ended December 31,
Change
(In thousands, except percentages)
2025
2024
$
%
Ecosystem and technology fees
$
117,671
$
25,820
$
91,851
355.7
%
Origination fees
7,029
7,828
(799)
(10.2)
Gain on sale of loans, net
113,856
94,084
19,772
21.0
Total Partner-branded net revenue
$
238,556
$
127,732
$
110,824
86.8
%
Partner-branded net revenue increased $110.8 million, or 86.8% during the year ended December 31, 2025, compared to the year ended December 31, 2024. The increase was primarily attributable to ecosystem and technology fees, which increased by $91.9 million, or 355.7%, during the year ended December 31, 2025, compared to the year ended December 31, 2024. This was primarily due to a $99.3 million increase in revenue recognized for ecosystem and technology fees from volume transacted on our Connect platform, for which minimal fees were earned in the prior year. Additionally, Partner-branded gain on sale of loans, net increased by $19.8 million, or 21.0%, during the year ended December 31, 2025, compared to the year ended December 31, 2024, as a result of an increase in the weighted average price of loans sold of 39.7%.
110
Table of Contents
Operating Expenses
General and administrative
Years Ended December 31,
Change
(In thousands, except percentages)
2025
2024
$
%
Compensation and benefits
$
29,514
$
21,568
$
7,946
36.8
%
Equity-based expense
59,113
35,423
23,690
66.9
Professional services
22,595
19,314
3,281
17.0
Impairment of capitalized software
—
8,591
(8,591)
n.m.
Other expense
20,749
19,355
1,394
7.2
Total general and administrative expense
$
131,971
$
104,251
$
27,720
26.6
%
General and administrative expense increased $27.7 million, or 26.6%. This primarily consisted of an increase in equity-based compensation expense of $23.7 million, due to the recognition of expense for stock-based compensation awards that satisfied the liquidity condition in connection with the IPO, additional grants associated with the IPO, and an increase in grants in the current year due to increased headcount. Additionally, compensation and benefits increased $7.9 million due to increased headcount as well as one-time bonuses associated with the IPO.
Technology and product development
Years Ended December 31,
Change
(In thousands, except percentages)
2025
2024
$
%
Compensation and benefits
$
24,847
$
25,690
$
(843)
(3.3)
%
Equity-based expense
12,036
9,363
2,673
28.5
Amortization
16,254
17,113
(859)
(5.0)
Software
10,980
9,688
1,292
13.3
Other expense
805
803
2
0.2
Total technology and product development expense
$
64,922
$
62,657
$
2,265
3.6
%
Technology and product development expense increased $2.3 million, or 3.6%, due to a $2.7 million increase in equity-based compensation expense primarily due to an increase in services exchanged for issuance of warrants of $2.9 million. This increase is partially offset by decreased amortization expense of $0.9 million for the year ended December 31, 2025 due to lower capitalized software balances, which are subject to amortization.
Operations and processing
Years Ended December 31,
Change
(In thousands, except percentages)
2025
2024
$
%
Compensation and benefits
$
23,002
$
18,557
$
4,445
24.0
%
Equity-based expense
455
388
67
17.3
Processing fees
41,599
25,507
16,092
63.1
Total operations and processing expense
$
65,056
$
44,452
$
20,604
46.4
%
Operations and processing expense increased $20.6 million, or 46.4%, primarily due to a $16.1 million increase in processing fees due to a 63.3% increase in Consumer Loan Marketplace Volume.
Sales and marketing
Years Ended December 31,
Change
(In thousands, except percentages)
2025
2024
$
%
Compensation and benefits
$
8,401
$
4,662
$
3,739
80.2
%
Equity-based expense
817
136
681
500.7
Advertising and other expense
66,876
50,859
16,017
31.5
Total sales and marketing expense
$
76,094
$
55,657
$
20,437
36.7
%
Sales and marketing expense increased $20.4 million, or 36.7%, primarily due to a $16.0 million increase in advertising and other costs driven by a 17.5% increase in Figure-branded volume, as well as a $3.7 million increase in compensation and benefits due to an increase in headcount.
111
Table of Contents
Interest expense
Interest expense decreased $7.5 million, or 13.4%, primarily due a $14.1 million decrease in exit fees paid to warehouse facilities and a $5.9 million decrease related to the impact of lower average SOFR rates on warehouse facilities. Those impacts are partially offset by a $7.0 million increase in retained interest financing costs due to securitization volume, and a $3.5 million increase in interest expense related to the MSR facility that we entered into during the second half of 2024.
Other (expense) income, net
Years Ended December 31,
Change
(In thousands, except percentages)
2025
2024
$
%
Change in fair value of digital assets held for sale
$
(9,200)
$
7,910
$
(17,110)
n.m.
Changes in value of fund investment
(1,996)
3,828
(5,824)
n.m.
Staking rewards and realized gains
6,976
747
6,229
833.9
Digital asset impairment
—
(5,859)
5,859
n.m.
Settlement income
—
2,750
(2,750)
n.m.
Other
368
3,481
(3,113)
(89.4)
Total other (expense) income, net
$
(3,852)
$
12,857
$
(16,709)
n.m.
Other (expense) income, net decreased $16.7 million, primarily driven by a $17.1 million decrease in the change in fair value of Solana tokens, as well as a $5.8 million decrease in the ratable value of the related fund for the year ended December 31, 2025 compared to the year ended December 31, 2024. These were offset by an impairment of $5.9 million of HASH held during the year ended December 31, 2024 due to a decline in the observable fair value of HASH transacted at the time of the Reorganization, that did not occur in the year ended December 31, 2025, and a $6.2 million increase in staking rewards and gain on sale of digital assets that we earned during the year ended December 31, 2025 compared to the year ended December 31, 2024.
Income Tax Provision
Income tax expense decreased by $22.8 million for the year ended December 31, 2025 compared to the year ended December 31, 2024. The provision for income taxes includes U.S. federal, state and local taxes. The effective tax rate for the year ended December 31, 2025 was approximately (18.1)%, compared to 9.9% for the year ended December 31, 2024. The effective tax rate differed from the U.S. federal statutory rate of 21.0% for the year ended December 31, 2025 primarily due to a discrete benefit arising from the Company’s reassessment of deferred tax asset realizability following the Recombination. The effective tax rate differed from the U.S. federal statutory rate for the year ended December 31, 2024 of 21.0% primarily due to utilization of net operating losses and tax credits related to our research and development activities. Refer to Note 13 in the Consolidated Financial Statements for further details.
Noncontrolling Interests in Consolidated Subsidiaries
Third-party investors hold interests in entities that we consolidate, and to whom we allocate the net income or loss of those entities. During the years ended December 31, 2025 and 2024, we allocated aggregate net income or loss to those third-party investors.
112
Table of Contents
Changes in Financial Position
The following table sets forth a summary of selected line items from our Consolidated Balance Sheets for the periods indicated, and the changes between such periods. These selected line items have been prepared on the same basis as our Consolidated Financial Statements. In the opinion of management, the financial information set forth in the table below reflects all normal recurring adjustments necessary for the fair statement of changes in the selected line items for these periods. The following selected line items should be read together with our Consolidated Financial Statements and related notes.
(In thousands, except percentages)
December 31, 2025
December 31, 2024
$ Change
% Change
ASSETS
Current assets:
Cash and cash equivalents(A)
$
1,198,141
$
289,670
$
908,471
313.6
%
Restricted cash
68,637
57,777
10,860
18.8
Loans held for sale, at fair value
404,337
395,922
8,415
2.1
Digital assets(A)
96,558
75,448
21,110
28.0
Accounts receivable, net
52,016
20,998
31,018
147.7
Loan servicing asset, at fair value
113,064
88,497
24,567
27.8
Marketable securities, at fair value
273,151
163,489
109,662
67.1
Digital assets, non-current
3,644
9,704
(6,060)
(62.4)
LIABILITIES
Current liabilities:
Payables to third-party loan owners
383,772
212,619
171,153
80.5
Debt, current
160,959
305,294
(144,335)
(47.3)
Debt, current to related parties
166,135
—
166,135
n.m.
Other current liabilities
105,642
70,401
35,241
50.1
Debt, non-current
230,143
167,882
62,261
37.1
(A) During the current period, we reclassified payment stablecoins from “Digital assets” to “Cash and cash equivalents”. Prior period amounts have been recast to conform to the current period presentation. This reclassification resulted in an increase to “Cash and cash equivalents” and a corresponding decrease to “Digital assets” of $2.4 million as of December 31, 2024. For further information, see Note 2, Change in Accounting Principle, to the Consolidated Financial Statements.
Assets
Cash, cash equivalents and restricted cash
Cash and cash equivalents increased by $908.5 million, or 313.6%, as of December 31, 2025, compared to December 31, 2024, and restricted cash increased $10.9 million, or 18.8%. Refer to “—Liquidity and Capital Resources—Cash Flows” for the drivers in the change of cash, cash equivalents and restricted cash provided by operating, investing and financing activities during the period.
Loans held for sale, at fair value
Loans held for sale, at fair value increased by $8.4 million, or 2.1%, as of December 31, 2025, compared to December 31, 2024, primarily due to originations of $3.7 billion and purchases of $3.3 billion offset by loan sales, net of repurchases, of $6.5 billion and principal payments of $460.3 million. We generally hold loans for a short period of time and the timing of loan sales and securitizations may impact the amounts carried at each period-end. Typically, the loan volumes we experience include seasonal variation that impact the growth of loans on our balance sheet during a fiscal year. Additionally, we anticipate activity on our Connect platform to grow, which may reduce the quantity of loans that we carry on our balance sheet over time.
Digital assets, current and non-current
Digital assets, current and non-current, increased $15.1 million, or 17.7%, as of December 31, 2025, compared to December 31, 2024, which represents the change in digital assets we hold for sale and the gross change of digital assets we hold as collateral. We recognize offsetting liabilities and changes thereon for digital assets held as collateral and do not record any net assets, gains, or losses thereon unless we are unable to liquidate collateral timely and are otherwise unable to collect amounts owed. We have not experienced any such losses to date.
113
Table of Contents
Digital assets held as collateral, gross of offsetting liabilities, decreased $11.9 million during the year ended December 31, 2025, due to a decrease of $3.5 million in Bitcoin holdings as a result of decreases in both the quantity and price of Bitcoin, and an $8.4 million decrease in Ethereum holdings, also due to decreases in both the quantity and price of Ethereum.
Digital assets held at fair value increased $16.7 million at December 31, 2025 primarily due to new holdings in Kamino Liquidity Pools of $23.5 million that were not held as of December 31, 2024, partially offset by a decrease in both the quantity and price of Solana holdings of $7.1 million compared to the prior year.
Digital assets held at cost increased $10.2 million at December 31, 2025 primarily due to a $10.2 million increase in HASH as a result of the settlement of the Provenance Blockchain Foundation related party loan in HASH.
See Note 3 in the Consolidated Financial Statements for further discussion on digital assets.
Accounts receivable, net
Accounts receivable, net increased $31.0 million, or 147.7%, as of December 31, 2025 compared to December 31, 2024, primarily driven by a $28.5 million increase in trade accounts receivable, which is driven by overall increased Partner-branded volume. Management continues to monitor customer credit exposure and collection trends.
Loan servicing asset, at fair value
Loan servicing asset, at fair value, increased $24.6 million, or 27.8%, as of December 31, 2025 compared to December 31, 2024, reflecting a $60.7 million increase, or 20.1%, in the unpaid principal balance of loans serviced during the year ended December 31, 2025, partially offset by a $28.2 million decrease in servicing fee collections and a $7.9 million reduction in the estimated fair value of servicing assets held based upon changes in valuation assumptions. See Note 4 in the Consolidated Financial Statements for further discussion on loan servicing assets.
Marketable securities, at fair value
Marketable securities, at fair value increased $109.7 million, or 67.1%, as of December 31, 2025, compared to December 31, 2024, primarily due to an increase in the volume of new securitizations that closed during the year in which the Company generally retained 5% of the total fair value contributed into securitizations, in the form of marketable securities. The newly retained marketable securities are partially offset by the scheduled paydown of existing marketable securities.
Liabilities
Payables to third-party loan owners
Payables to third-party loan owners increased $171.2 million, or 80.5%, as of December 31, 2025, compared to December 31, 2024, due to an increase in our servicing portfolio. The overall balance may fluctuate based on timing of collections and payments to third-party loan owners.
Debt, current and non-current
Total current debt, including related party, increased by $21.8 million, or 7.1%, primarily due to the $40.0 million debt to Lender 1 for the MSR financing becoming current as of December 31, 2025, compared to December 31, 2024. Debt, non-current increased by $62.3 million, or 37.1%, primarily due to the increase in financed retained interests primarily as a result of new securitizations that closed during the quarter.
Other current liabilities
Other current liabilities increased $35.2 million, or 50.1%, as of December 31, 2025 compared to December 31, 2024, primarily driven by a $22.5 million increase in liabilities due to the growth of deposit activity on Democratized Prime, a $9.2 million liability related to participation in Kamino liquidity pools, and an $11.0 million increase in payables related to loan purchases from partners. This was partially offset by a decrease of $11.9 million on crypto collateral held due to a decrease due to both the quantity and price of crypto assets held as collateral.
114
Table of Contents
Liquidity and Capital Resources
Sources and Uses of Funds
We maintain a capital-efficient model by utilizing a diverse set of funding sources. When we originate a loan directly or purchase a loan originated by our origination partners, we often utilize warehouse credit facilities with certain lenders to finance our lending activities or loan purchases. We sell the loans we originate or purchase from our origination partners to whole loan buyers and securitization investors, and earn servicing fees from continuing to act as the servicer on the loans. We proactively manage the allocation of loans on our platform across various funding channels based on several factors including, but not limited to, internal risk limits and policies, capital market conditions and channel economics. Our excess funding capacity and long-term relationships with a diverse group of existing funding partners help provide flexibility as we optimize our funding to support the growth in loan volume. For those loans sold through Figure Connect, we also collect fees as a source of funds. Our principal sources of liquidity are cash and cash equivalents, digital assets, available for sale securities, available capacity from warehouse and revolving credit facilities, securitization trusts, forward flow loan sale arrangements, and cash flows from our operations.
On September 12, 2025, we closed our IPO of our Class A common stock. The total net proceeds received were approximately $663.4 million after deducting underwriting discounts and commissions, and before offering expenses payable by us. We intend to use the net proceeds for general corporate purposes, including working capital, operating expenses, and capital expenditures. Additionally, we may use a portion of the net proceeds to acquire or invest in businesses, products, services, or technologies.
As of December 31, 2025, we had $1.2 billion in cash and cash equivalents, $68.6 million in restricted cash, $47.6 million in digital assets, excluding digital assets held as collateral, and approximately $1.8 billion in available Funding Debt capacity, excluding purchase commitments from third-party loan buyers. As of December 31, 2024, we had $289.7 million in cash and cash equivalents, $57.8 million in restricted cash, $20.7 million in digital assets held, excluding digital assets held as collateral, and $1.3 billion in available Funding Debt capacity, excluding purchase commitments from third-party loan buyers. Our restricted cash primarily relates to cash held by us on behalf of third-party loan sellers or buyers that represent collection of principal and interest from loan borrowers that we remit to those third parties as servicer of those loans.
Based on our current business plan and revenue prospects, we believe that our existing cash and cash equivalents, our anticipated cash flows from operations, and our available Funding Debt capacity will be sufficient to meet our working capital and operating resource expenditure requirements for at least the next 12 months from the date of this Annual Report. Beyond the next 12 months, we expect our long-term liquidity needs to consist primarily of working capital requirements and ongoing investments to support growth. We intend to maintain a strong liquidity position to provide flexibility to pursue strategic opportunities and manage potential variability in operating cash flows. As a result, we do not currently expect to require additional external financing to support our business operations over the long term.
Other Funding Sources
In connection with asset-backed securitizations, we sponsor and establish trusts (deemed to be VIEs) to ultimately purchase loans facilitated by our platform. Securities issued from our asset-backed securitizations are senior or subordinated, based on the waterfall criteria of loan payments to each security class. The subordinated residual interests issued from these transactions are first to absorb credit losses in accordance with the waterfall criteria. We consolidate securitization VIEs when we are deemed to be the primary beneficiary and therefore have the power to direct the activities that most significantly affect the VIEs’ economic performance and a variable interest that could potentially be significant to the VIE. Where we consolidate the securitization trusts, if any, the loans held in the securitization trusts are included in loans held for investment, and the notes sold to third-party investors are recorded in notes issued by securitization trusts in the consolidated balance sheets. We did not consolidate any securitization VIEs at December 31, 2025 or December 31, 2024. Refer to Note 9 in the Consolidated Financial Statements for further details.
Debt Obligations
Warehouse Credit Facilities
We fund substantially all of the loans we close on a short-term basis primarily through our warehouse credit facilities and from our operations. Loan production activities generally require short-term liquidity in excess of amounts generated by our operations. The loans we originate are financed through several warehouse credit facilities. Our borrowings are in turn generally repaid with the proceeds we receive from loan sales. We maintain warehouse credit facilities with separate third-party lenders through FL LLC, Figure REIT, Inc., Figure Markets Credit LLC, and their subsidiaries. Our warehouse credit
115
Table of Contents
facilities are primarily in the form of master repurchase agreements and loan participation agreements. Loans financed under these facilities are generally financed at approximately 80% to 100% of the principal balance of the loan (although certain types of loans are financed at lower percentages of the principal balance of the loan). Loans financed at less than 100% of the principal balance require us to fund the balance from cash generated from our operations. Once closed, the underlying loan that is held for sale is pledged as collateral for the borrowing or advance that was made under our warehouse credit facilities. In most cases, the loans will remain in one of the warehouse credit facilities for only a short time, generally less than one month, until the loans are sold. During the time the loans are held for sale, we earn interest income from the customer on the underlying loan. This income is partially offset by the interest and fees we pay due to borrowings from the warehouse credit facilities.
Borrowing capacity of committed debt facilities as of December 31, 2025 include the following:
December 31, 2025
(In thousands)
Final Stated Maturity
Borrowing Capacity
Balance Outstanding
Available Financing
Funding Debt:
Warehouse Facility 2
May 2026
$
150,000
$
2,904
$
147,096
Warehouse Facility 4
January 2026
335,300
7,039
328,261
REIT Warehouse
December 2026
200,000
750
199,250
Warehouse Facility 6
May 2026
250,000
—
250,000
Warehouse Facility 10
April 2026
300,000
1,700
298,300
Warehouse Facility 11
June 2027
300,000
6,063
293,937
Digital Asset Loan Facility
October 2026
30,000
3,097
26,903
MSR financing:
Lender 1
June 2026
40,000
40,000
—
Financed retained interests:
Retained Interest Facility
Various
500,000
231,633
268,367
$
2,105,300
$
293,186
$
1,812,114
Refer to Note 6 in the Consolidated Financial Statements for further details on our Warehouse Facilities and borrowing capacity.
Other than as noted above, our warehouse credit facilities bear floating interest rates, are payable on a monthly basis, and contain certain financial covenants, such as minimum tangible net worth, minimum liquidity, maximum leverage ratios, required range of net income or loss during specified periods, and periodic financial reporting requirements. Failure to comply with these covenants may result in an acceleration of payment on outstanding principal and accrued interest. As of December 31, 2025 and 2024 we were in compliance with the applicable covenants under each of our warehouse credit facilities. Our future capital requirements will depend on many factors, including, but not limited to, our continued access to debt facilities on terms that are favorable to us, our growth, our ability to attract and retain customers, the continuing market acceptance of our offerings, the timing and extent of spending to support our efforts to develop our platform and the expansion of sales and marketing activities. Further, we may in the future enter into arrangements to acquire or invest in businesses, products, services, and technologies. From time to time, we may explore additional financing sources and means to lower our cost of capital, which could include equity, equity-linked, and debt financing. We cannot assure you that any additional financing will be available to us on acceptable terms, or at all. If we raise additional funds by issuing equity or equity-linked securities, the ownership of our existing stockholders will be diluted.
116
Table of Contents
Cash Flows
The following table summarizes our consolidated cash flows for the periods indicated:
Years Ended December 31,
(In thousands)
2025
2024
Net cash provided by (used in) operating activities(A)
$
62,568
$
(127,012)
Net cash used in investing activities(A)(B)
(61,275)
(37,445)
Net cash provided by financing activities
918,038
336,124
(A) During the current period, we corrected the prior period presentation of retained beneficial interests in loan securitization transactions in the Consolidated Statements of Cash Flows. This correction resulted in a net increase to operating activities of $9.0 million and a net decrease to investing activities of $9.0 million for the year ended December 31, 2024. For further information, see Note 2 to the Consolidated Financial Statements.
(B) During the current period, we reclassified USDC stablecoins from “Digital assets” to “Cash and cash equivalents” on the Consolidated Balance Sheets. Prior period amounts have been recast to conform to the current period presentation. This reclassification resulted in a net increase to investing activities on the Consolidated Statements of Cash Flows of $2.4 million for the year ended December 31, 2024 and a corresponding increase to Cash and Cash Equivalents. For further information, see Note 2 to the Consolidated Financial Statements.
Net Cash from Operating Activities
Net cash provided by operating activities was $62.6 million for the year ended December 31, 2025, which consisted of net income of $134.3 million, working capital adjustments of $56.6 million, and non-cash adjustments of $(128.3) million. The working capital adjustments were driven by proceeds from loan sales, net of repurchases of $6.6 billion and principal payments on loans held for sale of $429.2 million, partially offset by originations of loans held for sale of $3.6 billion and purchases of loans held for sale of $3.3 billion. Additionally, working capital adjustments were impacted by accounts receivable of $33.0 million. The non-cash adjustments were primarily driven by gain on sale of loans, net, of $173.7 million, gains on servicing assets, net, of $24.6 million, and deferred income taxes of $26.0 million, partially offset by $62.4 million in stock based compensation, $16.3 million in amortization of internally developed software, and services exchanged for the issuance of warrants of $9.5 million.
Net cash used in operating activities was $127.0 million for the year ended December 31, 2024, which consisted of net income of $19.9 million, working capital adjustments of $(51.2) million, and non-cash adjustments of $(95.7) million. The working capital adjustments were driven by originations of loans held for sale of $3.2 billion and purchases of loans held for sale of $2.0 billion, partially offset by proceeds from loan sales, net of repurchases of $4.7 billion and principal payments on loans held for sale of $422.9 million. The non-cash adjustments were primarily driven by gain on sale of loans, net, of $140.4 million, and gains on servicing assets, net, of $32.6 million, partially offset by $38.7 million in stock based compensation, $17.1 million in amortization of internally developed software, $8.6 million related to impairment of internally developed software costs, losses on repurchased loans of $8.2 million, and services exchanged for the issuance of warrants of $6.6 million.
Net Cash from Investing Activities
Net cash used in investing activities was $61.3 million for the year ended December 31, 2025, primarily due to $102.2 million in purchases of marketable securities and $5.7 million in purchases of digital assets, partially offset by $63.9 million of principal payments on marketable securities and $11.3 million of proceeds from digital asset sales. Additionally, investing activities included $20.6 million in capitalization of internally developed software costs and $6.3 million of realized losses on futures.
Net cash used in investing activities was $37.4 million for the year ended December 31, 2024, primarily due to $25.2 million in purchases of marketable securities and $11.6 million in purchases of digital assets, partially offset by $15.3 million of principal payments on marketable securities and $3.3 million of proceeds from digital asset sales. Additionally, investing activities included $16.6 million in capitalization of internally developed software costs.
Net Cash from Financing Activities
Net cash provided by financing activities was $918.0 million for the year ended December 31, 2025, during which we received proceeds from debt of $6.0 billion, partially offset by $6.0 billion related to principal payments on debt. We raised $663.4 million from the issuance of common stock in connection with the IPO, net of offering costs. Additionally, financing activities were impacted by $167.2 million in proceeds from servicing activity on behalf of third-party loan owners, and $12.8 million in proceeds from stock option exercises.
117
Table of Contents
Net cash provided by financing activities was $336.1 million for the year ended December 31, 2024, during which we received proceeds from debt of $4.6 billion, partially offset by $4.4 billion related to principal payments on debt. Additionally, financing activities were impacted by $81.9 million in proceeds from servicing activity on behalf of third-party loan owners, and $71.8 million in proceeds from the issuance of preferred stock.
Other Changes in Financial Position
Noncontrolling interest in consolidated subsidiaries was $8.4 million at December 31, 2025, an increase of $0.1 million from December 31, 2024, primarily due to an increase in net income attributable to the noncontrolling interest.
Other Factors Affecting Liquidity and Capital Resources
Operating Lease Obligations
Our operating lease obligations consist of our lease of real property from third parties under noncancellable operating leases, including the lease of its current office spaces. Operating lease expense for our office space was $2.7 million and $2.8 million for the years ended December 31, 2025 and 2024, respectively. Our office leases are scheduled to expire between 2026 and 2031.
Available Liquidity and Capital Resources
As of December 31, 2025, our cash, cash equivalents, and restricted cash was $1.3 billion, which included $364.9 million of cash held for the benefit of third parties. As of December 31, 2024, our cash, cash equivalents, and restricted cash was $347.4 million, which included $198.8 million of cash held for the benefit of third parties. The restricted cash held by us primarily relates to cash held by us on behalf of third-party loan sellers or buyers that represent collection of principal and interest from loan borrowers that we remit to those third parties as servicer of those loans.
Non-GAAP Financial Measures
In order to better help understand our financial performance, we use several key performance metrics that should be viewed independently of GAAP items, as these metrics are not intended to be combined with those items. Our determination and presentation of these metrics may differ from that of other companies. The presentation of these metrics is meant to be considered in addition to, not as a substitute for or in isolation from, our financial measures prepared in accordance with GAAP.
Adjusted Net Revenue
Adjusted Net Revenue is a non-GAAP financial measure used by our management to evaluate operating performance. Accordingly, we believe this measure provides useful information to investors and others in understanding and evaluating our operating results in the same manner as our management and board of directors. In addition, Adjusted Net Revenue provides a useful measure for period-to-period comparisons of our business, as it removes the effect of a non-cash, non-realized adjustment that is included in net revenue. Adjusted Net Revenue is defined as net revenue excluding the change in fair value of MSR associated with changes in our estimates that management has determined are not reflective of our operating performance.
Adjusted EBITDA and Adjusted EBITDA Margin
Adjusted EBITDA and Adjusted EBITDA Margin are non-GAAP financial measures used by our management to evaluate operating performance, generate future operating plans, and make strategic decisions, including those relating to operating expenses and the allocation of internal resources. Accordingly, we believe these measures provide useful information to investors and others in understanding and evaluating our operating results in the same manner as our management and board of directors. In addition, these measures provide useful information for period-to-period comparisons of our business, as it removes the effect of certain non-cash items, variable charges, non-recurring items, unrealized gains or losses or other similar non-cash items that are included in net income or expenses associated with the early stages of the business that are expected to ultimately terminate, pursuant to the terms of certain existing contractual arrangements or expected to continue at levels materially below the historical level, or that otherwise do not contribute directly to management’s evaluation of its operating results. Adjusted EBITDA is defined as net income excluding interest expense incurred in connection with our debt obligations other than debt associated with our funding of loans held for sale, income taxes, amortization and depreciation expense, stock-based compensation expense, non-cash changes in certain financial instruments, and other items that management has determined are not reflective of our operating performance. Adjusted
118
Table of Contents
EBITDA Margin is calculated as Adjusted EBITDA divided by total net revenue. The most directly comparable GAAP measure is net income margin (calculated as net income divided by total net revenue).
The following table presents a reconciliation of net revenue to adjusted net revenue, net income to adjusted EBITDA, and net income margin to adjusted EBITDA margin for the years ended December 31, 2025 and 2024:
Years Ended December 31,
(In thousands)
2025
2024
Total net revenue
$
506,865
$
340,885
Plus: Valuation changes in fair value of MSRs
7,939
(1,703)
Adjusted net revenue
$
514,804
$
339,182
Net income
$
134,281
$
19,915
Plus: Valuation changes in fair value of MSRs
7,939
(1,703)
Plus: Change in fair value of digital assets and related investments
12,417
(10,674)
Plus: Impairment of capitalized software
—
8,591
Plus: Impairment of digital assets
—
5,859
Plus: Other asset impairment charge
—
4,970
Plus: Services exchanged for issuance of warrants
9,499
6,584
Plus: Registration costs
6,312
—
Plus: Restructuring costs
3,988
2,498
Plus: Stock-based compensation expense
62,922
38,726
Plus: Amortization of internally developed software costs
16,254
17,113
Plus: Non-funding interest expense
18,151
7,387
Plus: Income tax provision
(20,606)
2,177
Adjusted EBITDA
$
251,157
$
101,443
Net income margin
26.5
%
5.8
%
Adjusted EBITDA margin
48.8
%
29.9
%
Critical Accounting Policies and Estimates
Basis of Presentation
The accompanying Consolidated Financial Statements have been prepared in accordance with GAAP and include the accounts of our company and our subsidiaries. Our subsidiaries are entities in which our company holds, directly or indirectly, more than 50% of the voting rights or where it exercises control. All intercompany accounts and transactions have been eliminated.
As detailed in Note 1 of the Consolidated Financial Statements, the Recombination that was effective on August 29, 2025 recombined FTI and FMH through a series of transactions and FMH became a wholly-owned subsidiary of FTI. The Recombination was a reorganization of entities under common control as FTI and FMH were owned, either directly or indirectly, by the Controlling Party before and after the Recombination. As a result, the Recombination is accounted for in a manner similar to a pooling of interests with the assets and liabilities of the parties to the Recombination carried over at their historical amounts. Therefore, the Consolidated Financial Statements have been retrospectively recast to reflect the results as if FTI and FMH were a single consolidated entity as of the earliest period presented.
The preparation of the Consolidated Financial Statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, costs, and expenses and related disclosures. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. Actual results could differ significantly from our estimates. To the extent that there are differences between our estimates and actual results, our future financial statement presentation, financial condition, operating results, and cash flows will be affected.
We believe that the accounting policies described below involve a significant degree of judgment and complexity. Accordingly, we believe these are the most critical to aid in fully understanding and evaluating our consolidated financial condition and results of operations. For more information, see Note 2 to our Consolidated Financial Statements.
119
Table of Contents
Valuation of Loans, Securities, and Servicing Assets
Details of our processes for determining fair value are set out in Note 2 of our Consolidated Financial Statements. Estimating fair value requires the application of significant judgment. The type and level of judgment required is largely dependent on the amount of observable market information available to us. Assets and liabilities valued using internally developed valuation models and other valuation techniques that use significant unobservable inputs are classified at level 3, the lowest level in the fair value hierarchy defined under GAAP, and judgments used to estimate fair value of those assets and liabilities are more significant than those required when estimating the fair value of assets and liabilities classified within levels 1 and 2.
In arriving at an estimate of fair value for an asset or liability within level 3, we must first determine the appropriate valuation model or other valuation technique to use. Second, the lack of observability of certain significant inputs requires us to assess relevant empirical data in deriving valuation inputs including, for example, prepayment speeds, default rates, loss severities, discount rates, and valuations of comparable assets and liabilities. The methods used to estimate fair value may not result in an amount that is indicative of net realizable value or reflective of future fair values. Changes in market conditions, as well as changes in the assumptions or methodology used to determine fair value, could result in a significant increase or decrease in fair value.
Refer to Note 2 of our Consolidated Financial Statements for a further discussion of the valuation of level 3 instruments, including unobservable inputs used, and Note 12 of our Consolidated Financial Statements for quantification of the significant inputs used to value level 3 assets and liabilities, as well as sensitivities of their effects on fair value.
Estimates of Our Equity Value
Prior to the IPO, our equity did not historically trade on active markets and the value of our equity relied upon significant judgment and estimates based on unobservable inputs. We historically estimated the fair value of our equity, with assistance from independent third-party valuation consultants, as determined in accordance with the guidelines outlined by the American Institute of Certified Public Accountants. The valuation of our equity involved estimates based on (a) the expectation of future cash flows that we will generate, discounted to the present using a rate based on rates of return available from alternative investments of similar type, quality, and risk and (b) application of a valuation multiple derived from a comparison of us to publicly traded comparable entities’ valuation (as adjusted for observable differences in growth, profitability, risk, and operations).
Equity-Based Compensation
We grant equity-based compensation awards that vest contingent upon time-based service and/ or performance conditions based upon a qualifying sale of our equity, achieving certain contractual thresholds, or market conditions tied to our share price. We generally expense the grant-date fair value of these equity-based compensation awards over the required service period, but not before we deem applicable performance conditions probable. As awards with a market condition have the market condition incorporated into the fair value, we recognize the full compensation cost (based on grant-date fair value) over the service period, even if the market condition is ultimately not achieved.
Income Taxes
We are subject to income taxes in the United States. The evaluation of our uncertain tax positions involves significant judgment in the interpretation and application of GAAP and complex laws, including the realizable portions of our net operating loss deductions and research and development tax credits. Although we believe our reserves are reasonable, no assurance can be given that the final outcome of these uncertainties will not be different from that which is reflected in our reserves. Reserves are adjusted considering changing facts and circumstances, such as the closing of a tax examination. Resolution of these uncertainties in a manner inconsistent with our expectations could have a material impact on our financial condition and operating results.
Consolidation of VIEs
The determination of whether or not to consolidate a VIE under GAAP requires a significant amount of judgment concerning the degree of control over an entity by its holders of variable interests. To make these judgments, we conduct an analysis, on a case-by-case basis, of whether we are the primary beneficiary, the party who has the power to direct the activities of a VIE that most significantly impact its economic performance and who has the obligation to absorb losses or the right to receive benefits from the VIE that could potentially be significant to the VIE, and are therefore required to consolidate the entity. Management continually reconsiders whether we should consolidate a VIE. Upon the occurrence of certain events, management will reconsider its conclusion regarding the status of an entity as a VIE.
120
Table of Contents
Emerging Growth Company Status
As an “Emerging Growth Company,” the JOBS Act allows us to delay adoption of new or revised accounting pronouncements applicable to public companies until such pronouncements are made applicable to private companies. We have elected to use this extended transition period under the JOBS Act. As a result, our Consolidated Financial Statements may not be comparable to the financial statements of issuers who are required to comply with the effective dates for new or revised accounting standards that are applicable to public companies, which may make our Class A common stock less attractive to investors.
Recent Accounting Pronouncements
See Note 2 to our Consolidated Financial Statements for recently adopted accounting pronouncements and recently issued accounting pronouncements not yet adopted as of the dates of the statement of financial position.