PGY briefing — Pagaya Technologies Ltd.

Released: 2026-04-27 Briefing series: #1 of N Prior briefing: first in series Stock at release: $13.29 Inflection pattern: distressed_recovery

What changed since the last briefing

(This is the first briefing in the series.)

Company snapshot

• Ticker: PGY
• Name: Pagaya Technologies Ltd.
• What they do: Pagaya is an Israeli-incorporated, Nasdaq-listed AI fintech company that operates a credit network for financial institutions. Partners (banks, auto lenders, buy-now-pay-later providers, single-family rental operators) submit loan applications to Pagaya's AI platform, which evaluates them and routes accepted applications into asset-backed securitizations and other financing vehicles. Pagaya earns fees on network volume. Segments include personal loans, auto lending, home equity, point-of-sale financing, and single-family rental management (via Darwin Homes acquisition). (10-K FY2025, filed 2026-03-02)
• IPO date / listing method: Listed via SPAC merger — EJFA Closing Date June 22, 2022 (merger with EJF Acquisition Corp.); subject to 1-for-12 reverse share split effected March 8, 2024. (10-K FY2025, filed 2026-03-02; 10-K FY2024, filed 2025-03-12)
• Market cap at release: ~$1.09B (82.0M shares × $13.29; Class A 70.7M + Class B 11.3M)
• Sector / Industry: Technology / AI-driven Fintech / Credit Networks
• HQ: Tel Aviv, Israel (incorporated); principal U.S. operations in New York, NY
• CEO / Founder status: Gal Krubiner, co-founder and CEO. Company was founded by Krubiner together with co-founders. (10-K FY2025, filed 2026-03-02)
• Profitable?: Yes — net income attributable to Pagaya $81.4M in FY2025, the company's first profitable fiscal year. Operating income $263.8M. FY2024 net loss was $(401.4M). (10-K FY2025, filed 2026-03-02)
• Total shares outstanding: Class A 70,747,357 + Class B 11,288,577 = ~82.0M shares as of December 31, 2025. Class B carries 10 votes per share. (10-K FY2025, filed 2026-03-02)
• Fiscal year end: December

The arc

| Date | Event | Source | |------|-------|--------| | 2026-02-09 | Q4 2025 / full-year 2025 results announced: revenue from fees $1,261.3M, net income attributable to Pagaya $81.4M — first profitable year. | 8-K filed 2026-02-09 | | 2025-11-10 | Q3 2025 results: revenue from fees $339.9M (▲36.4% YoY); net income attributable to Pagaya $22.5M; operating income $80.0M. | 8-K filed 2025-11-10; 10-Q filed 2025-11-10 | | 2025-08-07 | Q2 2025 results announced; 9-month revenue run-rate on pace for >$1.25B full year. | 8-K filed 2025-08-07 | | 2025-07-17 | Acquisition of Theorem Technology, Inc. completed (AI credit infrastructure). Net cash received $159K — small asset acquisition. | 10-K FY2025, filed 2026-03-02 | | 2025-05-07 | Q1 2025 results announced. | 8-K filed 2025-05-07 | | 2024-03-08 | 1-for-12 reverse share split effected, reducing shares outstanding; concurrent Class B structure established. | 10-K FY2024, filed 2025-03-12 | | 2024-02-02 | New Credit Agreement entered: term loan facility with Acquiom Agency Services LLC as administrative agent. | 10-K FY2025, filed 2026-03-02 | | 2023-11-01 | Darwin Homes, Inc. acquired — single-family rental property management platform added as new vertical. | 10-K FY2025, filed 2026-03-02 | | 2023-01-01 | Full-year 2022 revenue from fees $685.4M; net loss attributable to Pagaya $(302.3M); operating loss $(251.5M). | 10-K FY2024, filed 2025-03-12 | | 2022-06-22 | EJFA Merger closed: Pagaya listed on Nasdaq via SPAC; Capital Restructuring including Preferred Share Conversion and Stock Split completed. | 10-K FY2025, filed 2026-03-02 |

Current state

Year-over-year changes (FY2024 → FY2025)

| Metric | FY2024 | FY2025 | Change | |--------|--------|--------|--------| | Revenue from fees ($M) | 1,004.6 | 1,261.3 | ▲25.5% | | Operating income ($M) | 66.8 | 263.8 | ▲294.9% | | Net income (loss) attributable to Pagaya ($M) | (401.4) | 81.4 | Turnaround |Source: 10-K FY2025, filed 2026-03-02; 10-K FY2024, filed 2025-03-12.

Most recent quarter (Q3 2025). Q4 2025 results were announced via 8-K on February 9, 2026, but a 10-Q was not separately filed after the full-year 10-K. The most recent interim filing is the Q3 2025 10-Q (period ended September 30, 2025). Q3 2025 revenue from fees was $339.9M versus $249.3M in Q3 2024 — up 36.4% year-over-year. Q3 2025 net income attributable to Pagaya was $22.5M versus a net loss of $(67.5M) in Q3 2024. Nine-month 2025 revenue from fees was $940.3M versus $728.9M in the nine months ended September 30, 2024 — up 29.0%. (10-Q filed 2025-11-10.)

Full-year FY2025 narrative. Revenue from fees reached $1,261.3M, up 25.5% from $1,004.6M in FY2024. Operating income was $263.8M versus $66.8M in FY2024 — a 295% increase — driven by production cost leverage and a large reduction in general and administrative expenses ($159.6M in FY2025 versus $240.8M in FY2024). Net income attributable to Pagaya was $81.4M in FY2025, the first profitable year, versus net losses of $(401.4M) in FY2024 and $(128.4M) in FY2023. The FY2024 loss was heavily influenced by $(404.2M) in net losses on investments in loans and securities; in FY2025 that charge was $(107.0M), a material reduction. Revenue from fees includes $652.7M from related party Partners in FY2025 (52% of total), indicating heavy reliance on a concentrated group of large financial institution partners. (10-K FY2025, filed 2026-03-02.)

Capital structure and balance sheet. As of December 31, 2025: cash and cash equivalents $235.3M; total assets $1,545.9M; long-term debt $481.6M; exchangeable notes $148.8M; secured borrowings $193.9M. In FY2025, Pagaya drew $500M under a new long-term debt facility and repaid approximately $347.6M of prior debt, incurring a $24.8M loss on extinguishment. Operating cash flow was $238.6M in FY2025, up from $47.8M in FY2024. Investments in loans and securities grew to $945.3M at December 31, 2025, representing risk retention tranches Pagaya holds in its own securitizations. (10-K FY2025, filed 2026-03-02.)

Key numbers

| Metric | FY2022 | FY2023 | FY2024 | FY2025 | |--------|--------|--------|--------|--------| | Revenue from fees ($M) | 685.4 | 772.8 | 1,004.6 | 1,261.3 | | Operating income (loss) ($M) | (251.5) | (24.4) | 66.8 | 263.8 | | Net income (loss) attributable to Pagaya ($M) | (302.3) | (128.4) | (401.4) | 81.4 |Source: 10-K FY2025, filed 2026-03-02; 10-K FY2024, filed 2025-03-12.

Recent news (last 6 months)

| Date | Headline | Source | Market reaction | |------|----------|--------|-----------------| | 2026-02-09 | Q4 & FY2025 results: revenue from fees $1,261.3M; net income $81.4M; first profitable year | 8-K filed 2026-02-09 | -26.8% | | 2026-01-13 | [Operational update — details in 8-K] | 8-K filed 2026-01-13 | [DATA NEEDED] | | 2025-12-05 | On December 5, 2025, Pagaya Technologies Ltd. | 8-K filed 2025-12-05 | -0.3% | | 2025-11-10 | Q3 2025 results: revenue from fees $339.9M (▲36% YoY); first profitable quarter at Pagaya level ($22.5M) | 8-K / 10-Q filed 2025-11-10 | +11.8% | | 2025-10-02 | Material agreement: (the “Company”) and Pagaya US Holding Company LLC, its wholly owned subsidiary, refinanced the revolving cr… | 8-K filed 2025-10-02 | [DATA NEEDED] |

Open questions

1. Related party concentration: In FY2025, $652.7M of $1,261.3M in revenue from fees — 52% — came from related party Partners. In FY2024 that figure was $679.1M of $1,004.6M — 68%. The business runs on a small number of large financial institutions. The 10-K identifies this as a material risk but does not disclose individual partner revenue shares. Which partners account for the top revenue tranches, and what is the contractual term and exclusivity, if any, of the largest relationships? (10-K FY2025, filed 2026-03-02.)

2. Risk retention investment portfolio quality: Pagaya holds $945.3M in investments in loans and securities as of December 31, 2025 — largely risk retention tranches from its own ABS securitizations. In FY2024, net losses on these investments were $(404.2M); in FY2025, $(107.0M). The reduction drove the swing to profitability. This portfolio's credit performance is directly tied to consumer credit quality, interest rates, and the models' predictive accuracy. What are the current loss rates on the underlying loan pools, and how does the Q4 2025 and Q1 2026 credit environment compare to the 2024 peak stress period? (10-K FY2025, filed 2026-03-02.)

3. Debt refinancing and interest burden: In FY2025, Pagaya drew $500M under a new long-term debt agreement and repaid approximately $347.6M of prior term and revolving debt, incurring a $24.8M extinguishment loss. Total financial debt at December 31, 2025 was approximately $824.3M ($481.6M long-term + $148.8M exchangeable notes + $193.9M secured borrowing). Interest and other expenses were $(80.4M) in FY2025. What are the covenant terms and maturity schedule of the 2025 debt facility? The 8.875% Senior Unsecured Notes due 2030 are a fixed obligation that must be serviced through sustained cash generation. (10-K FY2025, filed 2026-03-02.)

4. Darwin Homes trajectory: Darwin Homes (single-family rental property management, acquired in late 2023) is a segment distinct from the core AI credit network. The 10-K does not separately disclose Darwin revenue or profitability in the summary data available. How much of total revenue from fees derives from Darwin versus from loan origination fees? Is the Darwin platform profitable or dilutive to operating margins? (10-K FY2025, filed 2026-03-02.)

5. CFPB and fair lending regulatory risk: Pagaya's AI models evaluate creditworthiness for lenders subject to CFPB oversight, fair lending laws (ECOA, FCRA), and OCC guidance. The 10-K devotes material risk factor space to fair lending and AI regulatory risk. Any adverse finding or enforcement action by the CFPB or OCC regarding algorithmic credit models could disrupt partner relationships and require model overhaul. The company also operates under Israeli corporate law with Class B super-voting shares held by founders, limiting minority shareholder influence. (10-K FY2025, filed 2026-03-02.)

Red flags / things to verify

• FY2024 net loss magnitude versus FY2025 profit: The swing from $(401.4M) net loss in FY2024 to $81.4M net income in FY2025 is real but driven substantially by a reduction in unrealized/realized losses on the risk retention portfolio: $(404.2M) in FY2024 versus $(107.0M) in FY2025. This is not an operational improvement to fee-based cash flows but rather a fair value mark driven by credit market conditions. Investors should separate operating income ($263.8M FY2025 vs. $66.8M FY2024 — a genuine improvement) from the below-operating-line investment portfolio marks. (10-K FY2025, filed 2026-03-02.)

• Share count and dilution: The 10-K discloses weighted average diluted shares of 83.1M for FY2025 versus basic of 78.3M, reflecting options and warrants. Additionally, 2,027,147 redeemable convertible preferred shares remain outstanding as of December 31, 2025, convertible into ordinary shares. The Class B super-voting structure gives founders effective voting control despite minority economic ownership. (10-K FY2025, filed 2026-03-02.)

• Revenue from fees accounting: Pagaya's revenue from fees is recognized when it facilitates asset origination into its financing vehicles. This is a fee-for-service model tied to network volume (gross dollar value of assets originated). If network volume slows or credit market conditions tighten and partner banks originate less, revenue falls with low variable cost — but Pagaya holds the risk retention portfolio, which would simultaneously face mark-downs. The revenue model and the balance sheet risk are co-correlated in a stress scenario. Verify current network volume trajectory in the Q4 2025 earnings release. (10-K FY2025, filed 2026-03-02.)

• Israeli incorporation and geopolitical risk: Pagaya is incorporated under Israeli law and maintains substantial R&D operations in Israel. The 10-K explicitly identifies the ongoing security situation in Israel as a material risk factor, including potential mobilization of employees who are reservists and disruption to operations. This is a differentiated risk not present in domestic peers. (10-K FY2025, filed 2026-03-02.)

Sources

• 10-K (FY2025): Filed 2026-03-02 — https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=PGY&type=10-K&dateb=&owner=include&count=10
• 10-K (FY2024): Filed 2025-03-12 — SEC EDGAR, same company filing history
• 10-Q (Q3 2025, most recent interim): Filed 2025-11-10 — SEC EDGAR
• 8-K (FY2025 earnings): Filed 2026-02-09 — SEC EDGAR
• 8-K (Q3 2025 earnings): Filed 2025-11-10 — SEC EDGAR
• DEF 14A (Proxy): Filed 2025-04-30 — SEC EDGAR