Altisource Portfolio Solutions S.A.(ASPS) - 2025 Q3 - Quarterly Results

Financial Performance - Third quarter Service revenue was $39.7 million, an increase of $1.5 million or 4% compared to the same quarter of 2024[7] - Loss before income taxes and non-controlling interests improved by $6.8 million to $(1.7) million compared to the same quarter of 2024[7] - Net loss attributable to Altisource was $(2.4) million, a $7.0 million improvement compared to the same quarter of 2024[7] - Adjusted EBITDA for the third quarter was $3.6 million, roughly flat compared to the same quarter of 2024[7] - Adjusted EBITDA margin decreased to 9.1% from 9.5% in the same quarter of 2024, primarily due to product mix[7] - Adjusted diluted earnings per share improved to $0.10 from $(1.83) in the same quarter of 2024, a 105% increase[8] - Service revenue for Q3 2025 was $39.666 million, up from $38.150 million in Q3 2024, representing a growth of 3.96%[14] - Total revenue for the nine months ended September 30, 2025, reached $128.635 million, compared to $119.121 million for the same period in 2024, an increase of 8.57%[14] - Gross profit for Q3 2025 was $11.347 million, a decrease from $12.070 million in Q3 2024, reflecting a decline of 6.00%[14] - Basic loss per share improved to $(0.22) in Q3 2025 from $(2.61) in Q3 2024[14] - The company reported net cash used in operating activities of $(4.560) million for the nine months ended September 30, 2025, compared to $(3.624) million for the same period in 2024[18] - Adjusted net income attributable to Altisource for the nine months ended September 30, 2025, was not explicitly stated but is a key measure for evaluating ongoing performance[22] - For the three months ended September 30, 2025, adjusted operating income was $2,663,000, compared to $3,419,000 for the same period in 2024, representing a decrease of 22.2%[29] - The net loss attributable to Altisource for the nine months ended September 30, 2025, was $8,842,000, an improvement from a net loss of $26,867,000 in the same period of 2024[29] - Adjusted EBITDA for the three months ended September 30, 2025, was $3,621,000, slightly down from $3,624,000 in 2024, while for the nine months it increased to $14,265,000 from $12,640,000[29] - The diluted loss per share for the three months ended September 30, 2025, was $(0.22), compared to $(2.61) in 2024, indicating a significant improvement[31] - The company reported a pretax loss attributable to Altisource of $(1,736,000) for the three months ended September 30, 2025, compared to $(8,553,000) in 2024, showing a reduction of 79.7%[29] - Total income from operations for the three months ended September 30, 2025, was $521,000, down from $1,105,000 in 2024, reflecting a decline of 52.8%[29] - The adjusted pretax income attributable to Altisource for the nine months ended September 30, 2025, was $4,431,000, compared to a loss of $(16,683,000) in 2024, marking a significant turnaround[29] Cash and Debt Management - The company ended the quarter with $28.6 million in cash and cash equivalents[7] - Cash and cash equivalents at the end of Q3 2025 were $28.598 million, slightly down from $29.811 million at the end of 2024[16] - Total current liabilities decreased significantly to $39.657 million in Q3 2025 from $271.273 million at the end of 2024, indicating improved financial stability[16] - The company issued equity in exchange for debt reduction amounting to $45.370 million, reflecting strategic financial management[20] - Net debt as of September 30, 2025, stood at $143,290 million after accounting for cash and cash equivalents of $28,598 million[35] Business Development - New business won during the quarter is estimated to represent $14.4 million of annual Service revenue on a stabilized basis[5] - The weighted average sales pipeline was estimated between $33.6 million and $42.0 million for potential service revenue on a stabilized basis[7] - Industrywide mortgage origination volume increased by 17% for the nine months ended September 30, 2025, compared to the same period in 2024[9] Expenses and Compensation - Share-based compensation expense for Q3 2025 was $1,308 million, compared to $859 million in Q3 2024, reflecting a 52% increase[33] - Cost of cost savings initiatives for Q3 2025 was $276 million, up from $185 million in Q3 2024, indicating a 49% increase[33] - The per diluted share impact of share-based compensation expense, net of tax, was $0.11 for Q3 2025, down from $0.20 in Q3 2024[33] - Debt exchange transaction expenses for Q3 2025 amounted to $194 million, with a per diluted share impact of $0.02[33] - The company incurred debt exchange transaction expenses of $194,000 for the three months ended September 30, 2025, and $3,646,000 for the nine months, impacting overall financial performance[29] Taxation - The company recognized a full valuation allowance on its net deferred tax assets in Luxembourg, resulting in an effective tax rate of close to 0% for 2024 and 2025[23] - The company reported a significant tax benefit from certain income tax-related items of $536 million for Q3 2025, compared to $616 million in Q3 2024[33]