"We are grateful for the continued support of our warehouse lenders as we accelerate our business evolution through the deployment of Tinman AI across the mortgage ecosystem,†said Rob Wilson, Treasurer. "These enhancements materially improve equity capital efficiency by significantly reducing the required amount of equity capital for the facility. We expect this to be the first of multiple initiatives to expand warehouse capacity in a more capital-light manner, reflecting warehouse lender confidence in our ...

Core Insights - Better Home & Finance has leveraged generative AI alongside its existing machine learning capabilities to enhance operational efficiency and pursue growth in a challenging mortgage market [3][6][18] Business Performance - The company has experienced a year-over-year increase in loan volume by approximately 20% and revenue growth of about 50% [6][9] - Home equity business has surged more than 10 times, positioning Better as the fastest-growing home equity platform in America [9] - Revenue per loan has risen from $7,400 to $8,500, while contribution margin improved from around $500 to $1,700 per loan [6][7] Technological Advancements - Better's end-to-end mortgage platform, Tinman, is trained on over $110 billion of loans and consolidates multiple systems into a single workflow, currently accounting for about 45% of total revenue with a target of 80-90% [5][13] - The platform enables operational efficiencies, with 70% of loans processed as "one-day mortgages" and expectations for over 90% of loans to be AI-driven in the coming years [12][18] Market Strategy - Better is focusing on large enterprise partnerships and aims to double loan volume over the next six months, with a goal of achieving adjusted EBITDA profitability by the end of Q3 2026 [4][18] - The company is monetizing its Tinman platform by providing software and back-office support to mortgage brokers and retail lenders, expanding its market reach [13] Competitive Landscape - Key competitors include Rocket Mortgage and loanDepot in the direct-to-consumer space, while Better's AI-driven solutions differentiate it in the market [15] - Better's unique offering combines various mortgage functions into a unified platform, setting it apart from competitors like ICE-owned Encompass and Black Knight [16]

Summary of Better Home & Finance FY Conference Company Overview - **Company**: Better Home & Finance (NasdaqGM: BETR) - **Industry**: Home finance and mortgage industry - **Founded**: Approximately 10 years ago by CEO Vishal Garg - **Business Model**: Utilizes a machine learning-driven AI matching engine to connect consumer credit, income, asset, and property data with investor preferences for mortgage and home equity loans Key Financial Metrics - **Growth in Loan Volume**: Increased by approximately 20% in the past year [4] - **Revenue Growth**: Grew by about 50% [4] - **Home Equity Business Growth**: Expanded over 10X, becoming the fastest-growing home equity platform in America [4] - **Revenue per Loan**: Increased from $7,400 to $8,500 [4] - **Contribution Margin**: Improved from $500 to $1,700 per loan [4] - **Labor Cost per Fund**: Reduced from $2,900 to $2,500, significantly lower than the industry average of over $9,000 [5] Product and Technology Developments - **AI Integration**: The company has integrated GenAI into its existing machine learning engine, enhancing efficiency and unit economics [3] - **Tinman Platform**: Represents a comprehensive end-to-end solution for the mortgage industry, consolidating multiple systems into one workflow [9][10] - **AI Loan Processing**: 70% of loans can be processed as one-day mortgages, with 44% going from lock to commitment letter in under a minute [10] - **Future Projections**: Anticipates that over 90% of loans will be processed entirely via AI in the coming years, potentially reducing labor costs to below $1,000 per loan [11] Market Position and Competitive Landscape - **Market Size**: U.S. homes represent a total asset value of approximately $34 trillion, with a mortgage market of about $15 trillion [6] - **Market Share**: At peak in 2021, Better held nearly 2% market share in the overall mortgage market [6] - **Competitors**: Direct competitors include Rocket Mortgage and loanDepot, with a shift towards a platform-based model rather than direct-to-consumer [26] - **Unique Selling Proposition**: Better's platform offers a unique per-funded loan pricing model, which is attractive to mortgage brokers and lenders [29] Strategic Partnerships and Growth Initiatives - **Partnerships**: Collaborations with major financial institutions and mortgage originators to implement the Tinman platform [15][17] - **Market Trends**: The company is positioned to benefit from a potential increase in refinancing as interest rates stabilize [27] - **Consumer Demand**: Over 2 million pre-approved consumers are waiting to purchase homes, indicating significant future demand [33] Challenges and Concerns - **Affordability Issues**: Concerns about housing affordability and the availability of homes to meet demand [33] - **Scaling Operations**: The need to scale operations effectively to handle increased demand when market conditions improve [34] - **Regulatory Changes**: Potential changes in capital gains tax thresholds could incentivize homeowners to sell, impacting market dynamics [34] Conclusion - Better Home & Finance is positioned for significant growth in the home finance sector, leveraging advanced AI technology and strategic partnerships to enhance its competitive edge. The company anticipates a favorable macroeconomic environment that could stimulate demand for its services in the coming years.

Core Viewpoint - Better Home & Finance Holding Company has appointed Barry Feierstein as the new Chief Operating Officer to enhance organizational alignment and efficiency [1] Company Summary - Barry Feierstein will oversee Better's core Corporate Operations [1] - The company expresses enthusiasm about Feierstein's appointment, highlighting his unique blend of entrepreneurial spirit and operational discipline [1]

Core Viewpoint - The Russell 2000 index is positioned to potentially be the second-best-performing index in the U.S. stock exchanges as 2025 approaches, driven by a significant shift towards small-cap stocks due to the Federal Reserve's easing cycle [1]. Interest Rate Impact - The Federal Reserve has reduced the benchmark federal funds rate by 25 basis points, bringing it to a range of 3.5-3.75%, down from a high of 5.25-5.5% in 2023 during a tightening cycle aimed at controlling post-pandemic inflation [2]. Small Business Financing - Lower interest rates are favorable for small businesses, particularly as the period from mid-December to early March is historically strong for the Russell 2000 due to tax-loss harvesting and increased investor risk appetite at the start of the new year [3]. Top Performers in Russell 2000 - **Celcuity (CELC)**: - Stock Price: $100 - YTD Return: +695% - Market Cap: $4.71 billion - The company focuses on cellular analysis and precision oncology, experiencing significant stock price increases due to breakthrough clinical trials [5][6]. - **Better Home & Finance (BETR)**: - Stock Price: $48 - YTD Return: +442% - Market Cap: $794.72 million - Operates as an AI-powered mortgage lender and fintech company, with projected annual sales growth of over 50% this year and 67% next year [9][12]. - **Cogent Biosciences (COGT)**: - Stock Price: $40 - YTD Return: +413% - Market Cap: $5.58 billion - Focused on precision therapies for genetically defined diseases, with strong clinical progress on its lead drug, bezuclastinib [13][14]. Earnings Projections - Celcuity is expected to report a loss of -$3.86 per share in FY25 and -$4.05 in FY26, despite positive EPS revisions [8]. - Better Home's EPS revisions for FY25 and FY26 have slightly decreased, indicating potential short-term momentum loss [12]. - Cogent is projected to have a narrower adjusted loss of -$1.77 per share in FY26, with modestly higher EPS revisions in the last 60 days [14]. Investment Considerations - The strong performance of the Russell 2000 suggests that these top-performing stocks may be worth monitoring, although better buying opportunities may arise in the future [16].

Core Viewpoint - Hedge fund manager Eric Jackson is highly optimistic about Better Home & Finance Holding Co. (NASDAQ:BETR), positioning it as an AI-driven company rather than just a mortgage lender, similar to the trajectory of Palantir Technologies Inc. (NASDAQ:PLTR) [1][3] Group 1: Business Transformation - Better has restructured its operations around two main technologies, enabling it to originate loans at significantly lower costs compared to competitors while enhancing speed, pricing, and accuracy [2] - The market currently perceives Better as a struggling mortgage lender, but Jackson argues it has transitioned into an AI operating system for housing finance, akin to Palantir's approach in its sector [3] Group 2: Market Performance and Predictions - Jackson previously predicted a substantial upside for Opendoor Technologies Inc. (NASDAQ:OPEN), which has since seen a 1,492% increase in stock value, reinforcing his reputation in retail trading communities [4][5] - Better's revenue is reportedly showing early signs of an S-curve with a 51% year-over-year growth, flat operating expenses, and increasing AI-driven automation [6] - Jackson anticipates a "full re-rating" of Better's stock within the next 12 to 18 months, emphasizing its AI transformation and long-term potential as his top stock pick for 2026 [7]

Financial Performance - For the three months ended September 30, 2025, the company reported total net revenues of $43.867 million, a significant increase from $28.994 million in the same period of 2024[191]. - Net revenues for the three months ended September 30, 2025, increased to $43.9 million, a 51.3% increase from $29.0 million in the same period of 2024[223]. - The gain on loans, net for the three months ended September 30, 2025, was $36.421 million, representing 83% of total net revenues, compared to $21.503 million or 74% in the prior year[191]. - Gain on loans, net for the three months ended September 30, 2025, increased by $20.4 million or 129% to $36.4 million compared to $15.8 million for the same period in 2024, driven by increased funded loan volume[225]. - International lending revenue for the three months ended September 30, 2025, increased by $1.1 million or 91% to $2.3 million compared to $1.2 million in the same period of 2024, primarily due to increased operations in U.K. brokerage businesses[231]. - The net loss for the three months ended September 30, 2025, was $39.1 million, compared to a net loss of $54.2 million in the same period of 2024[223]. - Adjusted Net Loss for Q3 2025 was $(28,459) thousand, compared to $(48,886) thousand in Q3 2024, representing a 42% improvement year-over-year[271]. - Adjusted EBITDA for Q3 2025 was $(24,915) thousand, compared to $(38,870) thousand in Q3 2024, indicating a 36% improvement year-over-year[271]. Loan and Revenue Metrics - Funded loan volume for the three months ended September 30, 2025, was $1.210 billion, up from $1.035 billion in the same period of 2024[198]. - The average loan amount for the three months ended September 30, 2025, was $296,159, slightly down from $300,589 in the same period of 2024[198]. - The company reported a total of 4,086 loans funded during the three months ended September 30, 2025, compared to 3,443 loans in the same period of 2024[198]. - The company achieved a gain on sale margin of 3.01% for the three months ended September 30, 2025, compared to 2.08% in the same period of 2024[198]. Expenses and Costs - Total expenses for the three months ended September 30, 2025, were $82.8 million, slightly down from $83.1 million in the same period of 2024[223]. - Compensation and benefits expenses for the three months ended September 30, 2025, were $41.3 million, up from $37.8 million in the same period of 2024[223]. - Other revenue for the three months ended September 30, 2025, was $2.8 million, a decrease from $3.1 million in the same period of 2024[231]. - Broker revenue decreased by $0.8 million or 34% to $1.6 million for the three months ended September 30, 2025, primarily due to the conclusion of the integrated relationship partnership with Ally[227]. - General and administrative expenses decreased by $2.4 million, or 19%, to $10.2 million for the three months ended September 30, 2025, primarily due to reductions in rent and insurance premiums[253]. - Other expenses increased by $5.7 million, or 429%, to $7.1 million for the three months ended September 30, 2025, driven by increased liability classified warrants[261]. Strategic Initiatives - The company expanded its Retail channel by hiring the executive team from NEO Home Loans to enhance its distribution strategy[188]. - The company executed multiple new strategic partnerships, including one with a top five U.S. personal financial services platform serving over 50 million customers[190]. - The company plans to continue investing in technology to improve customer experience and reduce operational costs through automation[185]. - The company plans to sell several entities in the U.K. as part of a strategic shift, with the sale of its digital mortgage broker in the U.K. completed by the end of the third quarter of 2025[213]. Capital and Liquidity - The company raised approximately $568 million in gross proceeds from the Business Combination in August 2023, with $528.6 million in Convertible Notes issued[277]. - As of September 30, 2025, the company had an aggregate available amount of $575.0 million across three warehouse lines of credit[275]. - The company believes that funds from various sources will be adequate to meet liquidity and capital resource needs for at least the next 12 months[279]. - The Company implemented an At-the-Market (ATM) Offering Program on September 26, 2025, for sales of up to $75.0 million of its Class A common stock[289]. - The Company intends to use net proceeds from the ATM Program for general corporate purposes, including working capital and increasing warehouse line capacity[291]. Cash Flow - Net cash used by operating activities was $109.3 million for the nine months ended September 30, 2025, a decrease of $165 million, or 60%, compared to $274 million for the same period in 2024[293]. - Net cash used in investing activities was $589.5 million for the nine months ended September 30, 2025, an increase of $478 million, or 427%, compared to $111.8 million for the same period in 2024[295]. - Net cash provided by financing activities was $555.4 million for the nine months ended September 30, 2025, an increase of $462 million, or 496%, compared to $93.1 million for the same period in 2024[296]. - The increase in cash provided by financing activities was primarily driven by an increase in customer deposits through the Company's U.K. banking entity[296]. - The increase in cash used in investing activities was primarily due to purchases exceeding maturities of short-term investments and loan originations held for investment[295]. - The Company does not have any off-balance sheet arrangements that are likely to materially affect its financial condition[297].

Financial Data and Key Metrics Changes - In Q3 2025, funded loan volume increased by 17% year-over-year to approximately $1.2 billion, while revenue grew by 51% to approximately $44 million [18][19]. - The adjusted EBITDA loss for Q3 2025 was approximately $25 million, down from $27 million in the previous quarter and $39 million a year ago [37]. Business Line Data and Key Metrics Changes - Funded loan volume growth by product included home equity volume increasing by 52%, refinance loan volume increasing by 41%, and purchase loan volume increasing by 5% year-on-year [18]. - The direct-to-consumer (D2C) channel saw revenue per fund increase to $8,300, while the labor cost per fund decreased to $2,500, resulting in a net contribution margin of $1,772 per fund, a 64% increase quarter-on-quarter [22]. Market Data and Key Metrics Changes - The company is positioned to fund $500 million in monthly volume, with expectations to double this to at least $1 billion in the next six months due to new partnerships [6][18]. - The home equity market is highlighted as a significant opportunity, with Americans sitting on $35 trillion of home equity, representing the largest untapped asset class in the country [18]. Company Strategy and Development Direction - The company is evolving from a direct-to-consumer model to a platform that powers the entire home finance ecosystem, focusing on partnerships with local mortgage lenders and financial institutions [5][6]. - The strategy includes diversifying distribution channels and leveraging AI technology to enhance efficiency and reduce costs, aiming for adjusted EBITDA profitability by Q3 2026 [21][36]. Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in scaling rapidly and profitably, citing past growth during favorable rate cycles and the potential for significant market share in the upcoming cycle [17][40]. - The company anticipates that the partnerships will ramp up over the next six months, contributing to substantial loan volume growth [51][53]. Other Important Information - The company ended Q3 2025 with $226 million in cash and investments, maintaining strong relationships with financing counterparties [37][38]. - The partnerships announced are expected to transform the company's revenue model, with a focus on integrating AI-driven solutions into existing financial institutions [23][24]. Q&A Session Summary Question: Can you dive deeper into the three recent partnership announcements and how you expect each of these to ramp as we head into 2026? - Management expects the large financial services platform partnership to ramp over the next six months as user penetration increases, with potential for multiple billions in monthly volume [51][52]. Question: How would you characterize the future partnership pipeline right now? - The partnership pipeline has exploded due to the demand for Better's solutions, especially as incumbents face integration challenges [55][56]. Question: Can you provide details on the volume opportunity with the top five U.S. personal financial services platform? - The addressable market could be significant, with estimates suggesting potential originations of around $24 billion if penetration rates are achieved [60]. Question: What underpins the outlook for increasing loan volume to $1 billion? - The outlook is primarily driven by partnerships, with expectations for D2C growth and stable interest rates [61]. Question: Does the anticipated $1 billion loan volume assume full ramp-up of partnerships? - Management indicated that the $1 billion could be exceeded once partnerships are fully integrated [66]. Question: What is the expectation for customer acquisition costs (CAC) as partnerships grow? - CAC is expected to trend lower as partnerships become a larger part of loan volume, with no upfront CAC for partners [68].

Financial Data and Key Metrics Changes - In Q3 2025, funded loan volume increased by 17% year-over-year to approximately $1.2 billion, while revenue grew by 51% to approximately $44 million [18][19]. - The Adjusted EBITDA loss decreased to approximately $25 million, down from $27 million in the previous quarter and $39 million a year ago [37]. Business Line Data and Key Metrics Changes - Funded loan volume growth by product included home equity volume increasing by 52%, refinance loan volume increasing by 41%, and purchase loan volume increasing by 5% year-over-year [18]. - The direct-to-consumer (D2C) channel saw revenue per fund increase to $8,300, with a net contribution margin of $1,772 per fund, reflecting a 64% increase quarter-on-quarter [22]. Market Data and Key Metrics Changes - The company is positioned to fund $500 million in monthly volume, with expectations to double this to at least $1 billion in the next six months due to new partnerships [6][18]. - The marketplace for home equity lines of credit (HELOCs) is expected to be 100% of volume and revenue for the company, contrasting with incumbents who have a small portion of their volume from similar marketplaces [19][20]. Company Strategy and Development Direction - The company is evolving from a direct-to-consumer model to a platform that powers the home finance ecosystem through partnerships with local mortgage lenders and financial institutions [5][6]. - The strategy includes diversifying distribution channels and leveraging AI technology to enhance efficiency and reduce costs, aiming for break-even Adjusted EBITDA by Q3 2026 [21][36]. Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in scaling rapidly and profitably, citing past growth during favorable rate cycles and the potential for significant market share in the upcoming cycle [17][40]. - The company anticipates that the partnerships will ramp up over the next six months, contributing to substantial growth in loan volume and revenue [51][53]. Other Important Information - The company ended Q3 2025 with $226 million in cash and investments, maintaining strong relationships with financing counterparties [37][38]. - The company is focused on enhancing its go-to-market strategy while managing expenses and diversifying channels to achieve profitability [35][36]. Q&A Session Summary Question: Can you dive deeper into the three recent partnership announcements and how you expect each of these to ramp as we head into 2026? - Management expects the large financial services platform partnership to ramp over the next six months, with potential for multiple billions in monthly volume as user penetration increases [51][52]. Question: How would you characterize the future partnership pipeline right now? - The partnership pipeline has exploded due to the successful implementation of earlier partners and frustrations with incumbent solutions, leading to increased demand for the company's offerings [55][56]. Question: Can you provide detail on the volume opportunity with the top five U.S. personal financial services platform? - The addressable market could be significant, with estimates suggesting potential originations of around $24 billion if penetration rates are achieved [60][61]. Question: What is underpinning the outlook for increased loan volume? - The outlook assumes stable interest rates, with growth driven by partnerships and improvements in the D2C channel, which has seen organic growth of over 50% year-on-year [62][63]. Question: What is the anticipation for customer acquisition cost (CAC) as partnerships grow? - CAC is expected to trend lower as partnerships become a larger part of loan volume, with no upfront CAC associated with partner channels [70].

Financial Data and Key Metrics Changes - In Q3 2025, funded loan volume increased by 17% year-over-year to approximately $1.2 billion, while revenue grew by 51% to approximately $44 million, driven by increased loan funding through both direct-to-consumer (D2C) channels and the Tin Man AI platform [18][19] - The adjusted EBITDA loss for Q3 2025 was approximately $25 million, down from $27 million in the previous quarter and $39 million a year ago [37] Business Line Data and Key Metrics Changes - Funded loan volume growth by product showed home equity volume increasing by 52%, refinance loan volume increasing by 41%, and purchase loan volume increasing by 5% year-over-year [18] - The direct-to-consumer channel's revenue per fund increased to $8,300, while the labor cost per fund decreased to $2,500, resulting in a net contribution margin of $1,772 per fund, a 64% increase quarter-on-quarter [23] Market Data and Key Metrics Changes - The company is positioned to fund $500 million in monthly volume, with expectations to double this to at least $1 billion in the next six months due to new partnerships [6][18] - The marketplace for home equity lines of credit (HELOCs) is expected to grow significantly, with the company capturing 100% of volume and revenue in this space, unlike incumbents who have only a small portion [19][20] Company Strategy and Development Direction - The company is evolving from a direct-to-consumer model to a platform that powers the entire home finance ecosystem, focusing on partnerships with institutional lenders and financial institutions [5][6] - The strategy includes diversifying distribution channels and leveraging AI-driven platforms to reduce costs and improve customer experience, aiming for adjusted EBITDA profitability by Q3 2026 [21][36] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in scaling rapidly and profitably, citing strong unit economics and a robust pipeline of partnerships that will drive growth [17][36] - The company anticipates significant market share gains as the housing cycle turns and partnerships ramp up, with expectations of over $600 million in AI platform originations in Q4 2025 [39][40] Other Important Information - The company ended Q3 2025 with $226 million in cash and investments, maintaining strong relationships with financing counterparties [37][38] - The company is focused on enhancing its go-to-market strategy while managing expenses, with a goal of reaching break-even on an adjusted EBITDA basis by the end of Q3 2026 [35][36] Q&A Session Summary Question: Can you dive deeper into the three recent partnership announcements and how you expect each to ramp as we head into 2026? - Management expects the large financial services platform partnership to ramp over the next six months as user penetration increases, with potential for multiple billions in monthly volume [51][52] Question: What does the future partnership pipeline look like today? - The partnership pipeline has exploded due to the successful implementation of earlier partners and frustrations with incumbent solutions, leading to increased demand for the company's offerings [53] Question: Can you provide details on the volume opportunity with the top five U.S. personal financial services platform? - The addressable market could be around $24 billion based on a low average mortgage penetration rate, with potential for multiples of that through algorithmic mining of offers [55] Question: What underpins the outlook for increasing loan volume to $1 billion? - The outlook is primarily driven by partnerships, with expectations for significant growth in D2C as well, assuming interest rates remain stable [57][58] Question: How can AI efficiencies increase revenue per funded loan? - AI efficiencies are expected to enhance revenue per loan by allowing the AI platform to handle customer interactions and approvals more effectively than traditional loan officers [61]