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FIGR · Figure Technology Solutions, Inc. Class A Common Stock

Financial - Capital Markets · mkt cap $5.8B · calls: Q1 FY2026 vs Q4 FY2025
41.0 conviction · conf-adj 39

conf 4/10

enthusiasm:24.0 · trend:8 · quantifies:5 · impact:0 · under_radar:0 · credibility:0 · business_impact:4 · disruption:0 · confirmation:0

Enthusiasm latest 8 / prev 7 (rising)

Figure's AI thesis is narrowly but credibly operational: AI is applied to internal engineering velocity (25% more projects on flat headcount), customer support deflection (~70–75% chat containment), underwriting validation, and — most strategically — a validation pipeline for third-party asset onboarding that is intended to scale Democratized Prime without proportional cost growth. Management is careful to frame AI as a process accelerator rather than a moat, explicitly and repeatedly stating 'you can't AI your way into AAA,' positioning the durable competitive advantage in marketplace liquidity and blockchain infrastructure instead. The quantifications are real but bounded — they hit bottomline efficiency metrics only, with no AI-attributed revenue uplift disclosed — and the forward claims (H2 2026 AI-driven cost improvements, agentic workflows under new Head of AI) are directional rather than specific.

GROUNDED NEXT-FY IMPACT vs CONSENSUS

Grounded on actual base — revenue $0.5B · net income $0.1B · net margin 29.3% · diluted EPS 0.44

These are next-fiscal-year annual uplift estimates, not next-quarter numbers.

Aggregate next-FY est. rev uplift: 0.0% · next-FY EPS uplift: 0.51% · vs analysts: behind · priced in: high · confidence: 4/10

ClaimFigureArithmeticNext-FY Rev %Next-FY EPS %
Engineering throughput +25% YoY on flat headcount
productivity · soft		25% YoY story completionNo $ or opex/headcount base in claims or financials; cannot convert 25% to rev/EPS without inventing.
AI chat containment 70%
engagement · soft		70%70% containment rate only; no disclosed support cost, chat volume, or $/contact — cannot size $ savings.
Ops/processing 93→74 bps of volume (−20% rate)
cost		93 bps to 74 bps (−20% YoY rate)Disclosed bps; volume=$457.211M (FY2025 rev as volume proxy). Savings=$457.211M×(0.0093−0.0074)=$457.211M×0.0019=$868,701; after-tax@21%=$868,701×0.79=$686,274; EPS%=100×$686,274/$133,858,000=0.513%. Rev uplift=0 (cost, not topline).00.51
AI chat containment ~75% at launch
engagement · soft		~75%~75% launch containment; no $ cost base — unanchored; overlaps 70% metric, not double-counted.

Assumptions: Adopter-side only. Ops/processing: FY2025 revenue ($457.211M) as volume proxy for bps math (volume $ not disclosed); full FY2026 run-rate on achieved 19 bps spread (Q1'25→Q1'26). Cost savings: after-tax at 21%. No incremental rev margin applied (pure opex). EPS uplift vs current GAAP NI $133.858M (consensus EPS 0.66085 is ~32% above GAAP 0.44 — likely adjusted; % scale similar on either NI base). Engineering/containment: no segment $ bases → soft. Forward statements (H2'26 impact, partner doubling, third-party agents) unquantified — excluded.

Top line: Only hard claim is ops/processing efficiency (93→74 bps); treated as cost, not revenue — est_rev_uplift_pct=0. No quantified AI revenue/bookings in claims.

Bottom line: Ops/processing: $868,701 pre-tax on $457.211M volume proxy → $686,274 after-tax → 0.51% EPS vs current NI (0.44 diluted EPS). Engineering +25% and 70–75% containment unanchored in $.

Consensus FY2026: rev $778.256M (+70.2% vs $457.211M FY2025 actual; +51.9% vs $512.298M FY2025 est), NI $283.777M (+112% vs $133.858M), EPS $1.006 (+52.2% vs $0.661). Adopter-hard AI adds ~$0.87M pre-tax (~0.11% of FY2026 rev est) and ~0.51% EPS vs current NI (~0.24% of FY2026 NI est) — immaterial vs implied growth. 3 analysts on EPS.

QUANTIFICATIONS
Engineering throughput ('story completion') on flat headcount: 25% YoY increase (Last year (referenced in Q1 FY2026 call), bottomline)
“In the last year, we've seen a 25% increase year-over-year in what we call story completion, which is essentially engineering projects delivered on flat headcount.”
AI chat containment rate (customer support): 70% (As of Q1 FY2026, bottomline)
“In chat containment, we've seen 70% and are now implementing voice AI”
Operations and processing cost as a percent of volume (AI-attributed decline): Declined 20%, from 93 bps to 74 bps of volume (Q1 FY2025 to Q1 FY2026 (YoY), bottomline)
“Operations and processing income declined 20% from 93 basis points to 74 basis points as a percent of volume as our CLL volume more than doubled from Q1 '25 to Q1 '26. This is the power of our AI-driven efficiency road map.”
AI chat containment rate (customer support) at launch: ~75% ('roughly three-quarters') (Q4 FY2025 (launched ~two weeks before that call), bottomline)
“two weeks ago, we launched an AI customer service agent to streamline parts of our application flow, with roughly three-quarters of chat volume containment.”
PAST (realized)
CURRENT (now)
FORWARD (guidance)
PRICED-IN (REFINED)
HIGH (already in)

Est. revisions rising  ·  Fwd P/E 47.8  ·  EV/Sales 7.3x

Analyst sentiment is stable-to-improving (holds fell from 2 to 1 since Jan 2026; 6 Buy vs 1 Hold) and the lone recent price target ($55) sits above the 16-analyst average ($54.31), while consensus already embeds aggressive growth (~52% revenue and EPS growth into FY2026, ~23–27% into FY2027). At 47.8x forward P/E and 7.3x EV/Sales, the market is paying a premium fintech multiple for that trajectory. With no segment breakdown available, AI efficiency/revenue claims would map to total reported revenue, where those elevated estimates and multiples already reflect much of the upside.
BUSINESS IMPACT - QUALITATIVE MATERIALITY

6/10 qualitative impact   moderate  medium-term · mixed evidence

Where AI matters: ops processing cost & Democratized Prime onboarding

Credible adopter metrics—ops/processing 93→74 bps on 2x volume, ~70–75% support containment, +25% engineering throughput—but no disclosed AI revenue lift and only ~0.5% EPS from the hard cost line; strategic AI validation for third-party assets is early.

Caveats: No quantified AI-attributed revenue or bookings; Processing-spread/deflation if AI streamlining becomes industry table stakes; Agentic workflows and partner-validation scale still directional (H2 2026); Management frames AI as efficiency, not a standalone moat

AI DISRUPTION / CANNIBALIZATION RISK  tailwind · 3/10

Revenue is marketplace/blockchain infrastructure and liquidity, not billable labor; management explicitly caps AI on credit quality ('can't AI your way into AAA'). Industry automation may compress generic processing spreads, but Figure is using AI to scale onboarding and ops faster than volume—not to sell hours AI replaces.

OPTIONS / MARKET STRUCTURE

option liquidity: fair

ATM IV
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TYPICAL BID-ASK
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OPEN INTEREST
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proxy inputs — dollar-ADV $150M · beta -0.50542 · px $31.52

source: proxy (no options chain on FMP)
FMP /stable/ exposes no options-chain endpoint on this key, so ATM IV, bid-ask spread and open interest are unavailable. Liquidity below is a PROXY from dollar-ADV, beta and price level (a stand-in for option depth), not measured option-market data.

VERBATIM AI QUOTES
“Capital markets are undergoing a simultaneous shift from blockchain and AI and Figure is building the system that connects them. Here, we say AI is the brain, blockchain as the nervous system.”
— Michael Tannenbaum (CEO), Q1 FY2026
“Our custom AI platform operates on a structured, time-stamped on-chain financial data set that is directly tied to actual transactions, trained on real outcomes and helps with execution within our marketplace. This is a key point of differentiation and I can't emphasize enough.”
— Michael Tannenbaum (CEO), Q1 FY2026
“many organizations today are building AI-enabled features or experimenting with agents, but moving capital markets requires an underlying system that is optimized for reliability, control compliance. As I repeatedly say, you can't AI your way into AAA.”
— Michael Tannenbaum (CEO), Q1 FY2026
“To lead this next phase of execution, we recently welcomed back Rod Albuyeh as our Head of AI. Under his leadership, we're developing agenetic workflow systems on top of our platform that handle tasks like data onboarding, document validation, underwriting checks and exception handling. Everything we do is in systematically reduced friction in areas where automation complemented by human oversight when necessary, delivers the most value.”
— Michael Tannenbaum (CEO), Q1 FY2026
“In the last year, we've seen a 25% increase year-over-year in what we call story completion, which is essentially engineering projects delivered on flat headcount.”
— Michael Tannenbaum (CEO), Q1 FY2026
“In chat containment, we've seen 70% and are now implementing voice AI and most significantly, with Agora and now other third-party Democratized Prime assets, we introduced an AI-enabled validation workflow that compares third-party assets against the underwriting criteria those assets were intended to satisfy at origin. The initial results have been encouraging and are helping us build a more scalable workflow and control framework for honoring third-party assets.”
— Michael Tannenbaum (CEO), Q1 FY2026
“In a recent meeting with a major potential partner and executive shared that their company sees 2 existential threats. The first I expected, AI disrupting the value chain such that their company's cost advantage erodes, but the second was that Figure becomes the default capital market and that they're late to partner with us.”
— Michael Tannenbaum (CEO), Q1 FY2026
“we are making further investments to utilize AI and automate our operations. Our technology platform has proved to be extensible.”
— Macrina Kgil (CFO), Q1 FY2026
“Operations and processing income declined 20% from 93 basis points to 74 basis points as a percent of volume as our CLL volume more than doubled from Q1 '25 to Q1 '26. This is the power of our AI-driven efficiency road map.”
— Macrina Kgil (CFO), Q1 FY2026
“Near term, we expect operations and processing costs to remain relatively flat as a percent of volume as we continue these initiatives with AI-driven improvements expected to impact further in the second half of 2026.”
— Macrina Kgil (CFO), Q1 FY2026
“the implementations that we're doing in terms of AI and onboarding and examples, like I gave a Mutual of Omaha are being helped by tooling technology and the more visibility that we have being a public company.”
— Michael Tannenbaum (CEO), Q1 FY2026
“We have been explicit that AI is primarily about fueling growth opportunities for us and our partner ecosystem rather than simply optimizing costs.”
— Michael Tannenbaum (CEO), Q4 FY2025
“From an AI growth perspective, because our mortgage process is the fastest and lowest cost—again, as we have built our own integrated loan origination system and capital market that removes friction—it is the most optimized for AI.”
— Michael Tannenbaum (CEO), Q4 FY2025
“I was visiting with a partner, and they showed me a demo of an AI salesperson walking someone through their white-label Figure Technology Solutions, Inc. Class A Common Stock product. They said to me, we are going to divert more to Figure Technology Solutions, Inc. Class A Common Stock versus Fannie Mae because the process is so simple. It is much better suited for an AI workflow. I expect more partners to do the same in the coming months.”
— Michael Tannenbaum (CEO), Q4 FY2025
“two weeks ago, we launched an AI customer service agent to streamline parts of our application flow, with roughly three-quarters of chat volume containment. Importantly, we can now deploy our staff to focus on either enhanced support, which expands our partner ecosystem, or more growth-oriented tasks, especially as many of our unlicensed partners need our licensed staff for true sales activities.”
— Michael Tannenbaum (CEO), Q4 FY2025
“We have also embedded AI into property title review workflows and as a parallel validation step against our underwriting guidelines. These tools reduce error and enhance the quality and homogeneity of our assets.”
— Michael Tannenbaum (CEO), Q4 FY2025
“the agents we train on these workflows can then be deployed on third-party assets, making it easier for us to bring in new asset originators into our democratized prime short-term financing marketplace”
— Michael Tannenbaum (CEO), Q4 FY2025
“you cannot simply AI your way into that. What AI can do is optimize processes and fuel growth.”
— Michael Tannenbaum (CEO), Q4 FY2025
“As I wrote last year, you cannot AI your way into AAA.”
— Michael Tannenbaum (CEO), Q4 FY2025
“we are leveraging AI to make it go faster. There are three important examples of this.”
— Michael Tannenbaum (CEO), Q4 FY2025