Company: PGYWW
Filing Date: 2025-03-12
Form Type: 10-K
Source: 0001883085-25-000050
Chunk: 266

Company: Pagaya Technologies Ltd.
Filing Date: 2025-03-12
Form: 10-K
Item: Item 7
Chunk 266
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42023Change% Change(in thousands, except percentages)Other expense, net$(487,962)$(156,768)$(331,194)(211)%

Other expense, net for the year ended December 31, 2024 increased by $331.2 million, compared to the same period in 2023. The increase was primarily due to a higher credit-related impairment loss of $279.5 million on certain investments, driven by changes in the fair value of investments in loans and securities as a result of fluctuations in key inputs to the discounted cash flow models used to determine fair value. We consolidate certain VIEs which hold investments in securities which experienced a credit-related impairment loss of $50.1 million for the year ended December 31, 2024 that are not attributable to Pagaya, but rather are attributable to the VIEs noncontrolling interests. For further information, please see “—Net Income (Loss) Attributable to Noncontrolling Interests.” Also contributing to the increase were higher interest expenses of $59.3 million due to increased borrowing to support business growth, partially offset by a $4.2 million favorable impact from the changes in fair value remeasurement of warrants. 

Income Tax Expense 

Year Ended December 31,20242023Change% Change(in thousands, except percentages)Income tax expense$24,576 $15,571 $9,005 58 %

Income tax expense increased by $9.0 million, or 58%, to $24.6 million for the year ended December 31, 2024 from  $15.6 million for the year ended December 31, 2023. The increase was primarily driven by discrete tax expenses related to a change in the reserve related to credit loss on investments in loans and securities for the year ended December 31, 2024.

Net Loss Attributable to Noncontrolling Interests

Year Ended December 31,20242023Change% Change(in thousands, except percentages)Net loss attributable to noncontrolling interests$(44,292)$(68,301)$24,009 35 %

Net loss attributable to noncontrolling interests in the year ended December 31, 2024 decreased by $24.0 million, or 35%, compared to the same period in 2023. The decrease was driven by the net loss generated by our consolidated VIEs associated with our risk retention holdings. This amount represented the