Pagaya Technologies Ltd. · NASDAQ:PGY
Pagaya Technologies — Q1 2024 Earnings Presentation
21 slides from Pagaya Technologies's earnings presentation, May 9, 2024
Slide 1: 1Q24 Earnings Supplement
PA G AYA T E C H N O L O G I E S LT D . 1Q24 Earnings Supplement May 9th, 2024
Slide 2: Contents
01 Financial Metrics 02 Contents Operating Metrics 03 Non-GAAP Reconciliations
Slide 3: Financial Metrics
01 Financial Metrics
Slide 4: 1Q'24 financial highlights
1Q’24 financial highlights ($ millions) Q1 2024 Q1 2023 %∆ Network Volume $2,419 $1,850 31% Total revenue & other income $245 $187 31% Revenue from fees $237 $175 35% Production costs $145 $125 16% Revenue from fees less production costs (FRLPC)* $92 $50 84% Core operating expenses* $61 $57 7% Net i
Slide 5: Key financial metrics
Key financial metrics In $ millions; % in YoY growth Total Revenue FRLPC Adjusted EBITDA $270 $100 $45 $92 $40 $90 $40 $250 $245 $80 84% $35 $70 $230 $30 31% $60 $50 $25 $210 $50 $20 +$38 $40 $190 $187 $15 $30 $10 $20 $170 $10 $5 $2 $150 – – 1Q23 1Q24 1Q23 1Q24 1Q23 1Q24
Slide 6: Evolution of FRLPC
Evolution of FRLPC Components of FRLPC as a % of network volume 12.0% 9.5% 9.8% 10.0% 9.5% 9.5% 8.8% 8.0% 6.8% 6.2% 6.1% 6.0% 6.0% 5.6% 3.8% 3 -4 % 4.0% 3.4% FRLPC target 3.3% 3.2% range 2.7% 2.0% 0.0% 1Q23 2Q23 3Q23 4Q23 1Q24 Fee revenue % of network volume (take rate) Production costs % of network
Slide 7: Evolution of FRLPC by product
Evolution of FRLPC by product % contribution from lending partner and investor products Fee revenue less production costs as a % of network volume – breakdown by product 160% 3.8% 3.4% 140% 3.3% 3.2% 3.0% 3.0% 2.9% 120% 2.7% 100% 1% 25% 32% 80% 43% 58% 60% 63% 63% 60% 99% 40% 75% 68% 57% 20% 42% 40%
Slide 8: Evolution of FRLPC by line item
Evolution of FRLPC by line item AI integration, contract, and capital markets fees shown gross ($ in millions) 1Q23 2Q23 3Q23 4Q23 1Q24 AI integration $148 $159 $174 $184 $206 Contract $21 $18 $17 $20 $22 Capital markets $6 $9 $10 $7 $10 Total Fee Revenue $175 $186 $201 $210 $237 Production costs ($
Slide 9: Core operating expenses
Core operating expenses In $ millions Total operating expenses excluding share-based compensation expense, one-time expenses, and depreciation $61 $57 $55 $52 $51 30% 28% 25% 25% 23% 1Q23 2Q23 3Q23 4Q23 1Q24 Core Opex Core Opex as a % of revenue
Slide 10: Adjusted EBITDA
Adjusted EBITDA In $ millions $45 $40 $40 $34 $35 $30 $28 $25 $20 $17 $15 $10 $5 $2 – 1Q23 2Q23 3Q23 4Q23 1Q24
Slide 11: Operating Metrics
O02 Operating Metrics
Slide 12: Operating highlights
Operating highlights $ application volume from our Network volume Growing ABS lending partners (in $ millions) investor base (in $ billions) $3,000 $185 140 $180 $2,419 $180 5% 120 116 $2,500 31% 98 $175 100 $2,000 $1,850 $171 89 81 $170 77 80 $1,500 67 67 $165 60 52 47 47 50 $1,000 42 $160 40 36 22
Slide 13: Network volume
Network volume in $ millions $2,380 $2,419 $2,112 $1,947 $1,924 $1,957 $1,850 $1,786 $1,621 $1,650 $1,522 $1,088 $673 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 4Q23 1Q24 Source: Pagaya internal data, as of 3/31/2024
Slide 14: Applications evaluated vs conversion rate %
Applications evaluated vs conversion rate % Applications per quarter (in $ billions) versus conversion rate of applications into network volume (%) $225 2.5% $180B Applications evaluated in 1Q24 $175 2.0% $125 1.5% $75 <1% Conversion rate of applications 1.0% to issued loans $25 in 1Q24 1Q21 2Q21 3Q
Slide 15: Our ABS funding network
Our ABS funding network ABS Issuance ABS Investor Base Investors in Pagaya’s financing vehicles Pagaya ABS issuance across all products (in $billions) Capital contributed in 1Q’24 by investor type $7.1 $6.6 $6.1 $4.5 $1.9 Asset Manager Bank / Depository Hedge Fund 2020 2021 2022 2023 1Q24 TTM Insura
Slide 16: Credit performance: personal loan portfolio
Credit performance: personal loan portfolio Pagaya personal loan portfolio weighted average coupon (“WAC”) vs. 30-day+ DQs plus cumulative gross loss (“DQ”) Figures represent performance 3 months from issuance 25% 4% 20% 3% 15% WAC (%) DQ (%) 2% 10% 1% 5% 0% 0% 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 3Q22 4Q2
Slide 17: Credit performance: auto loan portfolio
Credit performance: auto loan portfolio Pagaya auto loan portfolio effective weighted average coupon (“EWAC”) vs. 60-day+ DQs plus cumulative gross loss (“DQ”) Figures represent performance 6 months from issuance 25% 16% 20% 12% 15% EWAC (%) DQ (%) 8% 10% 4% 5% 0% 0% 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 3Q
Slide 18: Non-GAAP Reconciliations
03 Non-GAAP Reconciliations
Slide 19: Reconciliation of Non-GAAP Financial Measures: Adjusted Net Income and EBITDA
PAGAYA TECHNOLOGIES LTD. RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (UNAUDITED) FOR THREE MONTHS ENDED MARCH 31, 2024 AND 2023 (in thousands) Three Months Ended March 31, 2024 2023 (In thousands) Net Loss Attributable to Pagaya Technologies Ltd. ($21,223) ($60,971) Adjusted to exclude the followi
Slide 20: Reconciliation of Non-GAAP Financial Measures: FRLPC
PAGAYA TECHNOLOGIES LTD. RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (UNAUDITED) FOR THREE MONTHS ENDED MARCH 31, 2024 AND 2023 (in thousands) Three Months Ended March 31, Fee revenue less production costs (FRLPC) 2024 2023 Revenue from fees $237,004 $175,254 Production costs ($144,881) ($125,057)
Slide 21: Reconciliation of Non-GAAP Financial Measures: Core operating expenses
PAGAYA TECHNOLOGIES LTD. RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (UNAUDITED) FOR THREE MONTHS ENDED MARCH 31, 2024 AND 2023 (in thousands) Three Months Ended March 31, 2024 2023 Operating expenses ($92,705) ($86,557) Adjusted to exclude the following: Share-based compensation $15,475 $16,367 D