Date: 2026-02-22 Quarter: Q3 FY25 (reported) + Q4 FY25 (preliminary) Task type: Earnings Review Atlas baseline: Read and used
The numbers are, frankly, preposterous in the best possible way. Revenue accelerating from 12% to 31% to 55% to 91% YoY over four consecutive quarters. Marketplace volume growing at 131% — faster than revenue, which means the platform is building head of steam. EBITDA margins of 51-55% while growing at 91%. I have been investing for decades and I can count on one hand the number of companies that grow at 90%+ while generating 50%+ EBITDA margins.
But I am not ready to call this a conviction hold. Here is why.
Thesis status: Intriguing but Unproven. Hold at current ~5% weight. Watch Feb 26 call carefully.
The revenue trajectory is what drew me to this company, and it has not disappointed:
| Q1'25 | Q2'25 | Q3'25 | Q4'25 (prelim) | |
|---|---|---|---|---|
| Revenue ($m) | 84.5 | 106.1 | 156.4 | ~160 |
| YoY % | 12.3% | 31.4% | 54.8% | 90.8% |
| QoQ % | +0.8% | +25.5% | +47.4% | +2.3% |
Revenue growth accelerating at scale — from 84Mtoarunrateof 640M annualized. That is the single most important thing I look for. I have seen it in Axon, in AppLovin, in Samsara. When it shows up like this, you pay attention.
The leading indicator that makes me even more excited: Marketplace Volume is growing at 131% YoY — faster than revenue. That is how platform businesses work. Volume today is revenue tomorrow. Figure Connect went from literally zero to 26% of revenue in nine months. Ecosystem & Tech Fees went from $7.3M to $35.7M YoY — nearly 5x. That is the highest-quality revenue stream in the company, and it is exploding.
EBITDA margins: 44.9% → 20.2% → 55.4% → 51.0% (Q3'24, Q4'24, Q3'25, Q4'25). The Q4'24 dip was real — gains on loan sales collapsed from $57M to $24M in a single quarter. That is the lumpy part of this business. But Q3-Q4 FY25 at 51-55% is outstanding. The company went from (5.6%) adj EBITDA margin in FY23 to nearly 50% in FY25. That kind of margin trajectory is extraordinary.
This is what separates a maturing platform from a commodity lender:
| Stream | Q3'24 | Q3'25 | Growth |
|---|---|---|---|
| Ecosystem & Tech Fees | $7.3M | $35.7M | +388% |
| Gains on Sale of Loans | $57.4M | $63.6M | +11% |
| Origination Fees | $18.9M | $21.4M | +13% |
| Interest Income | $12.8M | $17.9M | +40% |
| Servicing Fees | $6.5M | $7.9M | +22% |
The transaction-based revenue (Gains on Sale of Loans) is growing slowly. The platform revenue (Ecosystem & Tech Fees) is growing at 388% YoY. That shift in mix is exactly what I want to see. It means the business is becoming stickier, more recurring, less dependent on transaction volume in any single quarter.
Top 2 customers = 76% of UPB purchased. Let me say that again: two customers account for three-quarters of the business. This is the single biggest risk in the entire thesis. I care deeply about companies being masters of their own fate. A company where two customers can walk away and devastate the economics is not master of its fate.
Now, I understand that large financial institutions naturally dominate early in a marketplace's lifecycle. The 246 → 200 active partner decline quarter-over-quarter needs explanation. Is it seasonal? Is it consolidation? Or is the platform less attractive to smaller participants than it appears? The Feb 26 call must address this.
This drives me crazy. I read every earnings call transcript myself. Every time. I want to hear how management handles tough questions, what they emphasize, what they dodge. For FIGR I have no transcript. I have only the press release. For a company this early in its public life, that is a meaningful gap. I am flying partially blind.
$40M of stock-based compensation in a single quarter — 64% of the full-year total. If this is one-time IPO grants, fine. If this is a recurring run rate, then GAAP earnings are going to disappoint meaningfully and EBITDA becomes misleading. The Feb 26 call must address SBC normalization.
Cagney co-founded SoFi and built it into a real business. He also left under a cloud of sexual harassment allegations in 2017. He is now Executive Chairman of Figure. I have no idea what he does day-to-day or how much influence he exerts. But I have seen reputational risk erupt without warning. This is in the back of my mind.
One of the most important things I do is hold management accountable to their stated goals. FIGR has provided zero forward guidance. I understand this is common for new public companies, but it means I have no track record to evaluate. Are they growing as they expected? Are they surprised by the rate of adoption? I don't know.
This is the key question, and I think it is real. Let me explain why.
Figure built Provenance Blockchain as a settlement layer for financial assets. They tokenize HELOC loans on it. Lenders, servicers, and investors all transact on the same chain — eliminating the reconciliation friction that makes traditional capital markets expensive. The 75% market share in RWA tokenization is not marketing; it's the result of being first and being right.
Figure Connect — the secondary market for these tokenized loans — went from zero in early 2025 to $1.13B in volume by Q3. YLDS, their stablecoin, hit $376M in circulation and is growing 15% per month. These are not vanity metrics. YLDS earning yield on reserves while circulating as a settlement medium is a real business model.
DART (their AI credit model) has 91% adoption among marketplace participants. When 91% of your network is running on your proprietary credit model, you have deep switching costs. Nobody is ripping out Figure's rails and rebuilding elsewhere.
Is this comparable to a SaaS company with NRR of 120%? No. The revenue streams are lumpier, more transaction-dependent, more rate-sensitive. But the platform dynamics are real: network effects, high switching costs, expanding product surface. These are characteristics I recognize.
For a non-SaaS company I ask: is this growth secular or cyclical? Durable or fragile?
Arguments for durability:
Arguments against:
My assessment: Revenue durability is partially proven and improving as platform mix increases. Not yet at SaaS-level confidence, but better than a pure origination lender.
| Topic | Prior Belief | Updated Belief |
|---|---|---|
| Revenue trajectory | Unknown (first analysis) | Accelerating sharply — best in portfolio on growth-adjusted basis |
| Platform reality | Skeptical — blockchain lending sounds like marketing | More convinced — Provenance, DART, Figure Connect are real rails |
| Customer concentration | Not tracked | Serious risk — 76% top-2. Must improve. |
| SBC | Unknown | Concerning — $40M in Q4. Need run-rate clarity. |
| Management | No track record | Cagney history is real. Tannenbaum untested publicly. |
| Valuation | Appeared cheap | Confirmed cheap — 7.5x TTM rev on 91% growth is exceptional |
I am holding FIGR at ~5%. I am not adding until the Feb 26 call clarifies the SBC question and the partner concentration trend. If the call is strong — SBC is one-time, partner decline is seasonal, Figure Connect is accelerating, and they give FY26 guidance — I would seriously consider moving this to 8-10%.
The growth numbers are exceptional. The platform story is real. The valuation is among the cheapest in the portfolio on a growth-adjusted basis. But customer concentration at 76% and an untested management team at a company with only two quarters of public history demand patience.
Tell me again that growth investing doesn't work when a company grows 91% YoY at 50%+ EBITDA margins and trades at 7.5x revenue. But I follow the money and the results — and the Feb 26 call is where I will learn whether this story has legs beyond the extraordinary numbers.
Hold at ~5%. Watch Feb 26 call. Decision point for add or trim based on SBC, partner concentration, and guidance.
Best, Saul
Sources: Scout brief (2026-02-21), SEC EDGAR 10-Q Q3 FY25 (accession 0002064124-25-000032), Figure IR press releases (Q3 and Q4 preliminary), Atlas earnings review (2026-02-21)