0002064124-26-000029
SEC filingRevenue surged 97.6% to $167M, driven by ecosystem volume and Figure Connect growth; net income turned positive at $45M.
Figure Technology Solutions reported strong Q1 2026 results. Total net revenue increased 97.6% to $167.0M from $84.5M in Q1 2025, driven by 237% growth in Figure Connect volume and a 136% increase in ecosystem volume. Ecosystem and technology fees surged 203.0% to $47.3M, origination fees rose 85.4% to $23.1M, and gain on sale of loans, net grew 65.7% to $49.4M. Servicing fees increased 36.6% to $9.8M due to a 72% increase in the servicing portfolio. Interest income rose 72.6% to $19.4M. Gain on servicing asset increased dramatically to $12.9M from $0.3M, driven by higher loan sales and favorable valuation. Marketable securities income decreased 51.9% to $3.7M due to a $2.5M loss on fair value changes. Total expenses increased 63.6% to $125.1M, with general and administrative expenses up 142% primarily from $21.8M higher stock-based compensation related to IPO liquidity condition. Technology and product development decreased 10.4% due to lower headcount. Operating income rose to $41.9M from $8.1M. Net income of $45.0M compared to a $0.6M loss, benefiting from a $6.9M income tax benefit.
Figure-branded revenue grew 94.8% to $41.7M, driven by 99.0% volume growth and higher gain on sale. Partner-branded revenue increased 114.1% to $78.1M, primarily from ecosystem and technology fees which rose 206.5% as partners transitioned to Figure Connect. The mix shift toward Partner-branded continues, with Partner-branded revenue now representing 47% of total net revenue, up from 43% in the prior year.
Management noted no material changes to trends and factors affecting performance from the 2025 Form 10-K. The company launched OPEN blockchain network in February 2026 and authorized a $200M share repurchase program, with no shares repurchased as of March 31, 2026. Liquidity remains strong with $1.5B cash and $1.6B available Funding Debt capacity. The company believes existing resources are sufficient for at least 12 months. Adjusted EBITDA margin improved to 49.6%, indicating operating leverage potential.
Cash and cash equivalents increased $266M to $1.46B, driven by strong debt issuance. Marketable securities rose $25M to $298M. Total debt surged $310M to $867M, with $301M net proceeds from debt activities. Stockholders' equity increased $54M to $1.29B, aided by $45M net income.
The company has $172M in unfunded loan commitments ($118.9M undrawn HELOC, $53.1M near-term loan fundings) plus $6.4M in lease obligations. A joint venture capital commitment of $10.5M remains unfunded. Contingent repurchase obligations on loans could reach $2.0B, but only $16.8M is recorded.
A new $200M share repurchase authorization was announced on Feb 25, 2026. During Q1, the company repurchased $9.7M of Class A stock (312,500 shares) and withheld $8.5M for RSU settlements, totaling $18.2M. No dividends were paid. Capital expenditures were $6.4M for software development (3.8% of revenue). Net debt issuance added $300M in new financing.
The company operates as a single reportable segment, with all revenues and long-lived assets in the United States. No further segment disclosure is provided in the Notes.
CFO remained negative at -$37.8M, though it improved significantly from -$140.3M in the prior year, driven by a $45.0M net income (vs. -$0.6M) and positive working capital changes from loan activities. However, the core operating cash flow (excluding working capital) reflects heavy investment in loan originations and purchases, with proceeds from loan sales providing large inflows. Capex of $6.4M (capitalized software) represents a moderate intensity relative to the company's scale. Free cash flow is not explicitly stated but would be negative when combining CFO and capex. Capital returns include $9.7M in share repurchases and no dividends. Notable anomalies: significant non-cash adjustments including stock-based compensation ($25.9M) and gains on servicing and loan sales. Financing activities provided $361.2M, primarily from debt proceeds, which funded operating and investing shortfalls.