Pagaya 10-Q Details Q3: $49.7M Net Income, Credit Losses Widen to $43.4M
PGY sits 78% above its 52-week low of $10.4.
Summary
Pagaya's Q3 10-Q confirms $49.7 million of net income on $362.2 million of fee revenue, but credit-related losses more than doubled to $43.4 million and the credit-support liability rose to $27.9 million. The 2029 exchangeable notes are now exchangeable after the stock cleared $18.19.
Key Events · Earnings and Guidance · PGY
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Q3 Net Income $49.7M
Net income attributable to Pagaya was $49.7 million, or $0.52 diluted EPS, on $362.2 million of fee revenue (+7% YoY) and $390.5 million total revenue and other income (+12%).
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Credit Losses More Than Double
Losses on investments in loans and securities widened to $43.4 million in Q3 from $19.6 million a year earlier, and to $123.7 million for the nine months; $6.5 million of the Q3 charge sits with noncontrolling interests.
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Credit-Support Liability Nearly Doubles
The credit derivative liability rose to $27.9 million from $12.9 million at December 31, 2025, including $23.3 million of fair-value change and $8.3 million of cash payments in the nine months.
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Exchangeable Notes Now Exchangeable
The 2029 notes' sales-price condition was met as the stock exceeded $18.19 (130% of the $13.99 exchange price); holders may exchange in Q4 2026, with none having elected as of September 30.
Analysis · PGY · Finance
The headline numbers were already out on October 29, but the full 10-Q shows where earnings quality is strained: credit-related losses on the loan and securitization portfolio jumped to $43.4 million in Q3 from $19.6 million a year earlier, and the credit-support derivative liability nearly doubled to $27.9 million from $12.9 million at year-end. Those are the real cash and mark-to-market exposures behind a record $49.7 million of net income. Separately, the 2029 exchangeable notes crossed their $18.19 trigger, so holders can exchange in Q4 2026 — a potential ~11.4 million share overhang that had not been elected as of September 30.
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At the time of this filing, PGY was trading at $18.56 on NASDAQ in the Finance sector, with a market capitalization of approximately $1.5B. The 52-week trading range was $10.40 to $29.75. This filing was assessed with neutral market sentiment and an importance score of 7 out of 10.