10-K/A: Pagaya Technologies Files Amended 2025 Annual Report

Pagaya Technologies Ltd. amends its 2025 Form 10-K to provide updated details on long-term assets and subsequent events, including financial statement clarifications.

Summary

• Pagaya Technologies Ltd. is filing an amendment (Amendment No. 2) to its Annual Report on Form 10-K for the fiscal year ended December 31, 2025.
• The primary purpose of this amendment is to update Note 19 (Segments and Geographical Information) to provide more detailed information on the geographic distribution of the Company's long-term assets.
• Additionally, the amendment updates Note 20 (Subsequent Events) and the Form 10-K cover page, including an update to the number of ordinary shares outstanding as of May 30, 2026.
• The amendment also includes updated certifications and a consent from the independent registered public accounting firm, Kost Forer Gabbay & Kasierer, reflecting the updated opinion date for specific notes.
• These updates do not impact the Company's previously reported financial position for the periods presented.

Sentiment

Score: 7

Explanation: StockSavvy.ai views this filing as moderately positive, primarily due to the company's return to profitability and strong growth in key financial metrics for the year ended December 31, 2025. The amendment itself is procedural, but the underlying financial performance is encouraging.

Positives

• The company reported a net income of $81.4 million for the year ended December 31, 2025, a significant turnaround from a net loss of $401.4 million in the prior year.
• Adjusted EBITDA increased substantially to $371.0 million in 2025 from $210.4 million in 2024, indicating improved operational profitability.
• Revenue from fees grew by 26% year-over-year, reaching $1,261.3 million in 2025, driven by strong Network AI fees.
• Network Volume increased by 9% to $10.5 billion in 2025, demonstrating continued growth in the company's core business.
• The company's FRLPC % improved to 4.9% in 2025 from 4.2% in 2024, reflecting enhanced operational efficiency.
• General and administrative costs decreased by 34% in 2025 compared to 2024, indicating successful cost management efforts.
• The company's total assets increased to $1,545.9 million as of December 31, 2025, from $1,291.1 million in the prior year.
• Shareholders' equity grew to $480.0 million as of December 31, 2025, from $326.5 million in the prior year.

Negatives

• The company's AI technology has not been extensively tested during economic downturns.
• A significant portion of revenue is derived from a limited number of partners, creating a concentration risk.
• The company has a history of net losses, and future profitability is not guaranteed.
• The company's financial performance is susceptible to fluctuations in consumer credit activity and capital markets.
• The company incurred a loss of $24.8 million from the extinguishment of debt related to the repayment of its term loan.

Risks

• The company's AI technology has not been extensively tested during different economic conditions, including down-cycles.
• A limited number of partners account for a substantial portion of the company's network volume and revenue, posing a concentration risk.
• The company has incurred net losses in the past and may not be able to achieve profitability in the future.
• Adverse developments affecting financial institutions or the financial services industry generally could adversely affect the company's operations and liquidity.
• The company is subject to risks related to its incorporation and location in Israel, including political, economic, and military conditions.

Future Outlook

The company's financial performance is expected to be influenced by its ability to continue improving its AI technology, expand its network to new enterprise lenders, and drive capital efficiency and sustainable profitability. The company intends to continue making strategic investments to support its business growth.

Management Comments

• Pagaya's mission is to deliver more financial opportunity to more people, more often.
• We believe our mission will be accomplished by becoming the trusted lending technology partner for the consumer finance ecosystem.
• We are a product-focused technology company that deploys sophisticated data science and proprietary, AI-powered technology to enable better outcomes for financial institutions, their existing and potential customers, and institutional or sophisticated investors.
• Our AI technology typically enables Partners to convert a larger proportion of their application volume into originated loans, enabling them to expand their ecosystem and generate incremental revenues.
• We believe that our success in adding new Partners to our network is driven by our distinctive value proposition: driving significant revenue uplift to our Partners at limited incremental cost or credit risk to the Partner.

Industry Context

StockSavvy.ai notes that Pagaya's amended filing highlights the ongoing trend in the fintech sector towards greater transparency and detailed disclosure, particularly concerning asset distribution and subsequent events. The company's focus on AI-driven underwriting and its expansion into various credit asset classes align with broader industry efforts to leverage technology for improved financial access and efficiency.

Comparison to Industry Standards

• Pagaya's revenue growth of 26% in 2025, while strong, is in line with other high-growth fintech companies that are scaling rapidly in the consumer lending space.
• The improvement in Adjusted EBITDA and the shift to net income in 2025 reflect a trend seen in some mature fintech companies that have moved past the initial high-growth, high-investment phase and are now focusing on profitability.
• The company's reliance on AI for underwriting is a key differentiator, but also places it under scrutiny similar to other AI-driven platforms regarding potential bias and regulatory compliance, an area of increasing focus across the financial services industry.
• The company's capital structure, including senior notes and revolving credit facilities, is typical for companies in its sector seeking to fund growth and manage operations.

Legal Proceedings

• The company is not presently party to any litigation that, if determined adversely to it, is believed to have a material adverse effect on its business, financial condition, results of operations, or cash flows.

Related Party Transactions

• The company has transactions with securitization vehicles and other Financing Vehicles which are also related parties.
• As of December 31, 2025, total fee receivables from related parties were $106.9 million, primarily from securitization vehicles and other Financing Vehicles.
• As of December 31, 2025, amounts due from related parties were $42.6 million, included in other assets, entirely attributable to Financing Vehicles.
• As of December 31, 2025, amounts due to related parties were $10.6 million, included in accrued expenses and other liabilities.
• For the year ended December 31, 2025, total revenue from related parties was $652.7 million, primarily from securitization vehicles and other Financing Vehicles.
• For the year ended December 31, 2025, the company purchased $13.2 million of loan principal from Financing Vehicles, recognizing a loss of $6.2 million.

Stakeholder Impact

• Shareholders benefit from the company's return to profitability and improved financial metrics, potentially leading to increased share value.
• Investors in Financing Vehicles may see improved returns due to the company's AI technology and expanded network, though risks related to economic conditions and AI testing remain.
• Partners may benefit from enhanced access to financial products and improved customer experiences facilitated by Pagaya's technology.
• Creditors and lenders may be impacted by the company's debt levels and its ability to manage its capital structure, as detailed in the financial metrics and debt discussions.

Next Steps

• Continue to monitor the company's progress in expanding its network to new enterprise lenders.
• Observe the impact of ongoing AI technology development and testing across different economic conditions.
• Track the company's capital allocation strategies, including any further debt repurchases or liability management exercises.
• Evaluate the company's ability to maintain and grow relationships with existing partners and attract new ones.

Key Dates

Recommendation

While the company has shown significant improvement in profitability and revenue growth for the fiscal year 2025, the inherent risks associated with its AI technology's performance in various economic cycles, reliance on a few key partners, and the evolving regulatory landscape warrant a cautious approach. The company has demonstrated operational progress, but the market conditions and competitive environment necessitate a 'hold' recommendation until further sustained positive performance and de-risking are evident.

Keywords

Pagaya Technologies, SEC Filing, Form 10-K/A, Amendment, Financial Statements, Long-Term Assets, Subsequent Events, Auditor Consent, AI Technology, Fintech