Key Points
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SoFi’s meteoric growth is now paired with rapidly rising profits.
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Upstart’s innovative AI lending model provides significant advantages for its partners.
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One stock has a riskier profile, laden with long-term uncertainty.
- 10 stocks we like better than SoFi Technologies ›
SoFi Technologies
(NASDAQ: SOFI) is redefining the digital banking landscape, achieving remarkable growth in the financial services sector. This has not gone unnoticed, with a stock price increase of 416% over the past three years (as of Jan. 12).
Upstart
(NASDAQ: UPST) is an innovative player using artificial intelligence
to revolutionize how borrowers obtain credit. However, the stock has exhibited significant volatility, currently trading 88% below its peak.
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Between SoFi and Upstart, which is the more compelling fintech investment right now?
Image source: Getty Images.
SoFi’s Rapid Evolution into a Profitable Player
Growth is not an issue for SoFi; its adjusted net revenue increased by an astonishing 126% between Q3 2022 and Q3 2025. The company is also experiencing record customer growth, a clear sign of its effectiveness in a competitive market. While financial services typically offer commoditized products, SoFi distinguishes itself through superior user experience.
This revenue growth has translated into significant profits. SoFi reported an adjusted net income of $227 million in 2024, with expectations to double this to $455 million in 2025. This stands in stark contrast to its earlier days, when it sustained an adjusted net loss of $54 million in 2023. The scalability offered by a digital-only business model is evident in SoFi’s expanding fortunes.
The company’s pipeline of innovations remains strong, positioning SoFi as a forward-thinking competitor in the financial sector. Recently, SoFi announced a partnership with Lightspark, aimed at facilitating fast and low-cost cross-border transfers through the Bitcoin Lightning network. Additionally, cryptocurrency trading has been integrated into its platform, appealing to affluent and younger demographics seeking modern banking solutions.
Upstart’s AI-Powered Lending Model
Upstart has been at the forefront of utilizing AI and machine learning in the lending space, well before these concepts became mainstream. Over the past decade, the company has honed an AI-driven lending model that analyzes a myriad of borrower-specific data to assess creditworthiness. This sophisticated approach goes far beyond the traditional FICO Score, which considers only five basic parameters.
With this innovative model, Upstart has been successful in approving more borrowers while effectively managing default rates, a win-win for its network of over 100 lending partners. The recent figures speak volumes: Upstart’s transaction volume and revenue surged by 128% and 71%, respectively, in Q3 2025. Traditional personal loans have been the cornerstone of Upstart’s offerings, but the company is also seeing explosive growth in auto loans and HELOCs, with year-over-year increases of 357% and 324%, respectively.
Despite its progress, Upstart remains focused on growth rather than immediate profitability. However, management anticipates a GAAP net income of $50 million for 2025, a noteworthy rebound from a net loss of $129 million in 2024.
Evaluating Risk and Reward
Analysts tend to view Upstart as the more attractive investment option, with a consensus one-year price target suggesting a 24% upside—significantly higher than the 2% upside estimated for SoFi. While these projections can serve as useful guidance, they should be interpreted carefully.
In terms of valuation, Upstart appears more economical, sporting a forward price-to-earnings (P/E) ratio of 20.5. Nevertheless, the company carries a higher risk profile, lacking a proven track record of sustained revenue and growth through various economic cycles. This uncertainty should be taken into account when considering an investment.
On the other hand, SoFi, while bearing a higher valuation with a forward P/E of 46.1, shows robust profitability and a clearly defined path for continued success. Despite varying price targets from analysts, the upward trajectory of SoFi’s profits makes it an exciting option for prospective investors.
Should You Consider Investing in SoFi Technologies?
Before making a decision on SoFi Technologies, it’s worth noting that the Motley Fool Stock Advisor team has pinpointed the 10 best stocks to consider, and SoFi wasn’t included.
This highlights an important point: even stocks that are experiencing rapid growth might not necessarily align with the investment strategy suggested by experienced analysts.
For context, consider popular stocks that made it onto past lists, like Netflix on December 17, 2004. An investment of $1,000 back then would have grown to a staggering $477,544!* Likewise, an investment in Nvidia after its inclusion on April 15, 2005, would currently be worth $1,122,686!*
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*Stock Advisor returns as of January 15, 2026.
Neil Patel does not have a position in any of the mentioned stocks. The Motley Fool has positions in and recommends Bitcoin and Upstart, while also recommending Fair Isaac. The Motley Fool adheres to a strict disclosure policy.
The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.
