The American "Big and Beautiful" Act has been passed and is in effect. As a signature economic policy of the Trump administration, its tax reforms, social welfare cuts, and financial regulatory adjustments will have multiple impacts on various industries in the United States. Financial technology companies like Sofi may benefit from the Federal student loan cap reduction, which will stimulate $SoFi Technologies(SOFI.US)$ Will stock prices continue to soar?

In fact, SoFi's share price has risen from $8 to $21 this year, an increase of 1.6 times, and it continues to maintain a strong upward trend. What does the future hold? This week's opportunity will be shared quickly.

SoFi's core business

$SoFi Technologies(SOFI.US)$ is a digital personal finance company, listed in 2019, initially focused on student loans, providing low-cost loans to students and emerging in the market. It gradually developed into an integrated digital platform, offering "one-stop" financial services covering borrowing, saving, consumption, investment, and asset protection.

Currently, SoFi's main business focuses on three sectors: "Loan Services", "Financial Services", and "Technology Platform". "Loan Services" covers personal loans, student loans, and home loans; "Financial Services" builds a digital financial ecosystem with SoFi Money (cash management), SoFi Invest (investment), SoFi Credit Card, and SoFi Relay (financial monitoring), and extends to corporate employee benefit programs through SoFi At Work; the "Technology Platform" mainly serves corporate clients, providing them with technological products and solutions.

$SoFi Technologies(SOFI.US)$ The core competitive advantage lies in its "Financial Service Productivity Cycle," which attracts customers through a single product and then cross-sells various products such as loans, investments, and banking, resulting in very strong user stickiness.

Revenue continues to grow, and profits are stable.

In Q1 2025, SoFi's adjusted revenue was $0.771 billion, with an adjusted year-on-year growth rate of 33%, outperforming expectations. Overall, starting from Q3 2024, SoFi's revenue growth has rebounded from the bottom, likely influenced by the Federal Reserve's interest rate cuts, which improved the profitability of the lending business. Another highlight is that net profit (GAAP) losses are continuously narrowing, achieving profitability for six consecutive quarters since Q4 2023, indicating that SoFi's profitability is becoming stable.

It is worth noting that although SoFi's quarterly revenue has consistently maintained positive growth, the growth rate has significantly declined since Q4 2022, which is related to the overall stabilization of memberships and product growth. Referencing the near quarters' memberships and product quantities, the year-on-year growth rate is also declining, indicating that the company's business is gradually stabilizing.

The lending business is the pillar, with significant growth in financial services.

By business segment, the lending department is the core pillar of SoFi's revenue. In Q1 2025, the lending department generated $0.41 billion in revenue, contributing $23.89 million in profit, accounting for 57% of the profit contribution, with a year-on-year growth of 15%. The performance of the lending department primarily comes from the increase in memberships, driven by demand for personal loans, student loans, and housing loans. The total loan amount in Q1 reached $7.2 billion, a year-on-year increase of 66%, with personal loans breaking a quarterly record at $5.5 billion and student loans up 59% year-on-year to $1.2 billion.

Additionally, the financial services sector had revenues of $0.303 billion in Q1, with a year-on-year growth rate of 101%, the most significant among the three divisions; it contributed $0.148 billion in profit, accounting for 37%. The growth in financial services primarily stems from deposit-driven net interest income growth and the expansion of the SoFi membership program. The total deposit balance increased to $27.3 billion, with over 90% of the deposits coming from direct deposit members of SoFi Money, saving the company on funding costs.

The technology platform's Q1 revenue was $0.103 billion, with a year-on-year growth rate of 10%; it contributed $30.91 million in profit, accounting for 7%. Notably, the number of accounts served by the technology platform reached $0.158 billion, a 5% year-on-year increase, and the business is achieving breakthroughs and innovations, such as the launch of a co-branded debit card with Wyndham Hotels, showcasing the diversified development of the technology platform.

Overall, SoFi's performance is still quite impressive, and moving forward, attention can be focused on the growth rates and profit contributions in the three core businesses, especially in the lending and financial services sectors, as their revenue contributions determine SoFi's growth trends.

Future expectations.

Cryptocurrency Layout

SoFi has announced the restart of its cryptocurrency Business, planning to offer trading of popular tokens such as Bitcoin and Ethereum, and plans to launch a stablecoin, providing deferred lending services based on crypto assets and expanding payment options. Although the product launch timeline has not yet been announced, the Genius Act provides SoFi with a regulatory pathway.

Compared to $Coinbase(COIN.US)$ and $Robinhood(HOOD.US)$ ， $SoFi Technologies(SOFI.US)$ In the cryptocurrency Business, it has already fallen behind; if it can catch up quickly in the future, it may provide a new growth inflection point for SoFi, beneficial for stimulating stock price upward.

Student Loan Policy Bonuses

In terms of student loans, the latest Big and Beautiful Act will completely abolish the Biden administration's student loan benefits plan, which will lead to more students flocking to private lending institutions for loans, which is bullish news for SoFi's lending Business. Analysts predict that SoFi's student loan issuance volume may rebound to 1 billion dollars per quarter, with an annual growth rate of 30%+.

Combining the performance data from Q1 2025, it can be seen that the amount of student loans issued has increased for three consecutive quarters. With interest rates declining and opportunities for loan bonuses, student loans are expected to continue to grow.

Risks and Challenges

SoFi's risks come from other CNI Xiangmi Lake Fintech Index companies, such as $PayPal(PYPL.US)$ ， $Robinhood(HOOD.US)$ ， $Block(XYZ.US)$ and the competition from many traditional Banks. More importantly, SoFi's Business income primarily comes from loan products, and interest rate changes could affect borrowing costs and loan demand. If the Federal Reserve cannot effectively contain inflation, leading to unexpected rises in interest rates, or if the macroeconomy deteriorates, resulting in an increase in unemployment rates, this could significantly increase loan defaults, adversely affecting SoFi's Operation.

Technical Analysis

As of July 11, 2025, $SoFi Technologies(SOFI.US)$ The stock price has been on a strong upward trend, breaking through the key resistance level of $20.8 and setting a new 52-week high of $21.8, with an increase of 149% since the low in April this year.

According to the Fibonacci expansion line, the stock price has broken through the 100% extension level, opening up space for upward movement, looking up with resistance at $24.7 (the historical high in 2021) and downward support at $16.3 (Fibonacci extension line 61.8% extension level). It is important to note that no Technical Indicator is completely effective and can only serve as a reference.

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