Pagaya Technologies Ltd. · NASDAQ:PGY
Pagaya Technologies — Q2 2024 Earnings Presentation
20 slides from Pagaya Technologies's earnings presentation, Aug 9, 2024
Slide 1: 2Q24 Earnings Supplement
PAGAYA TECHNOLOGIES LTD . 2Q24 Earnings Supplement August 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: 2Q'24 financial highlights
2Q’24 financial highlights ($ millions) Q2 2024 Q2 2023 %∆ Network Volume $2,331 $1,957 19% Total revenue & other income $250 $196 28% Revenue from fees $243 $186 31% Production costs $146 $121 21% Revenue from fees less production costs (FRLPC)* $97 $65 49% Core operating expenses* $55 $55 1% Net i
Slide 5: Key financial metrics
Key financial metrics In $ millions; % in YoY growth Total Revenue FRLPC Adjusted EBITDA $270 $120 $60 $250 $50 $250 $100 $97 $50 49% $230 $80 28% $40 $65 +$33 $210 $60 $30 $196 $190 $40 $20 $17 $170 $20 $10 $150 – – 2Q23 2Q24 2Q23 2Q24 2Q23 2Q24
Slide 6: Evolution of FRLPC
Evolution of FRLPC Components of FRLPC as a % of network volume 12.0% 10.4% 9.5% 9.8% 10.0% 9.5% 8.8% 8.0% 6.2% 6.1% 6.0% 6.2% 6.0% 5.6% Targeting 3.5%-4.5% 4.2% FRLPC% in 2H’24 3.8% 4.0% 3.3% 3.4% 3.2% 2.0% 0.0% 2Q23 3Q23 4Q23 1Q24 2Q24 Fee revenue % of network volume (take rate) Production costs %
Slide 7: Evolution of FRLPC by product
Evolution of FRLPC by product % contribution from lending partner and investor products Fee revenue less production costs as a % of network volume – breakdown by product 4.2% 160% 3.8% 140% 3.4% 3.3% 3.2% 120% 3.0% 2.9% 3.0% 2.7% 100% 1% 80% 25% 32% 43% 58% 60% 63% 63% 69% 60% 99% 40% 75% 68% 57% 20
Slide 8: Evolution of FRLPC by line item
Evolution of FRLPC by line item ($ in millions) 2Q23 3Q23 4Q23 1Q24 2Q24 AI integration $159 $174 $184 $206 $216 Contract $18 $17 $20 $22 $21 Capital markets $9 $10 $7 $10 $6 Total Fee Revenue $186 $201 $210 $237 $243 Production costs ($121) ($129) ($134) ($145) ($146) Total FRLPC $65 $73 $76 $92 $9
Slide 9: Core operating expenses
Core operating expenses In $ millions Total operating expenses excluding share-based compensation expense, one-time expenses, and depreciation $61 $55 $55 $52 $51 28% 25% 25% 23% 22% 2Q23 3Q23 4Q23 1Q24 2Q24 Core Opex Core Opex as a % of revenue *Note: See “Appendix” for a reconciliation of non-GAAP
Slide 10: Adjusted EBITDA
Adjusted EBITDA In $ millions $60 $50 $50 $40 $40 $34 $30 $28 $20 $17 $10 – 2Q23 3Q23 4Q23 1Q24 2Q24 *Note: See “Appendix” for a reconciliation of non-GAAP measures to the most comparable GAAP measure
Slide 11: Operating Metrics
O02 Operating Metrics
Slide 12: Network volume
Network volume in $ millions $2,380 $2,419 $2,331 $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 2Q24 Source: Pagaya internal data, as of 6/30/2024
Slide 13: Our ABS funding network
Our ABS funding network Growing ABS ABS Investor Base ABS Issuance Investors in Pagaya’s financing vehicles Pagaya ABS issuance across all products (in $billions) investor base Capital contributed in TTM 2Q’24 by investor type $6.6 $6.1 $6.2 140 120 $4.5 120 116 98 100 89 81 77 80 67 67 60 52 $1.9 4
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 $193B Applications evaluated in 2Q24 $175 $125 $75 <1% Conversion rate of applications to $25 issued loans in 2Q24 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 3Q
Slide 15: 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 16: 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 17: Non-GAAP Reconciliations
03 Non-GAAP Reconciliations
Slide 18: 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 JUNE 30, 2024 AND 2023 (in thousands) Three Months Ended June 30, 2024 2023 Net Loss Attributable to Pagaya Technologies Ltd. ($74,785) ($31,297) Adjusted to exclude the following: Share-based c
Slide 19: Reconciliation of Non-GAAP Financial Measures: FRLPC
PAGAYA TECHNOLOGIES LTD. RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (UNAUDITED) FOR THREE MONTHS ENDED JUNE 30, 2024 AND 2023 (in thousands) Three Months Ended June 30, Fee revenue less production costs (FRLPC) 2024 2023 Revenue from fees $242,594 $185,685 Production costs ($145,602) ($120,613) F
Slide 20: Reconciliation of Non-GAAP Financial Measures: Core operating expenses
PAGAYA TECHNOLOGIES LTD. RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (UNAUDITED) FOR THREE MONTHS ENDED JUNE 30, 2024 AND 2023 (in thousands) Three Months Ended June 30, 2024 2023 Operating expenses ($99,715) ($85,237) Adjusted to exclude the following: Share-based compensation $18,044 $20,208 Dep