Financial Data and Key Metrics Changes - The company reported an adjusted net loss of $21 million in Q4 2025, compared to a loss of $3 million in Q3 2025, primarily due to lower pull-through weighted gain on sale margin and higher amortization on the MSR portfolio [11][12] - Adjusted total revenue for Q4 2025 was $316 million, down from $325 million in Q3 2025 [12] - Pull-through weighted lock volume increased by 4% to $7.3 billion in Q4 2025 from $7 billion in Q3 2025 [11] - Loan origination volume reached $8.0 billion in Q4 2025, a 23% increase from $6.5 billion in Q3 2025, marking the highest level since 2022 [13][18] Business Line Data and Key Metrics Changes - Servicing fee income increased slightly from $112 million in Q3 2025 to $113 million in Q4 2025, reflecting growth in the unpaid principal balance of the servicing portfolio [14] - The company originated fewer higher-margin second trust deeds and FHA, VA loans in Q4 2025, which contributed to larger average loan balances but decreased margin percentage [13] Market Data and Key Metrics Changes - The company gained market share in an expanding market, achieving a 71% recapture rate from its in-house servicing platform [4] - The retail lending market remains fragmented, with no lender controlling more than 5% market share, presenting significant opportunities for customer-facing scaled originators [5] Company Strategy and Development Direction - The company aims to leverage its digital-first direct lending business and in-market retail business to capture profitable market share growth across refinance, resale, and new home loans [45] - A focus on operational efficiency and technology investments is expected to drive growth and improve customer experience [9][18] - The company plans to re-enter the wholesale lending channel to achieve greater scale and improve operating efficiency [41] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the potential for market consolidation and the benefits for large-scale, diversified customer-facing originators [4] - The company anticipates a larger refinance market and aims to improve customer acquisition and retention through technology and AI [9][18] - Management expects Q1 2026 pull-through weighted lock volume to be between $7.75 billion and $8.75 billion, with origination volume between $6.75 billion and $7.75 billion [16] Other Important Information - The company ended Q4 2025 with $337 million in cash, a decrease of $222 million from Q3 2025, reflecting investments in loan inventory and repayment of unsecured notes [18] - Year-over-year, adjusted revenue increased by 10% while limiting expense growth to less than 1%, resulting in a 31% reduction in adjusted net loss [18] Q&A Session Summary Question: Can you expand on your profitable share gains and where you're seeing success? - Management highlighted a diversified retail customer touch model, with growth in the builder business and opportunities in direct lending, emphasizing the need to rebuild marketing and lead management systems [21][26] Question: What are your expectations for non-volume related OpEx and profitability in 2026? - Management indicated modest investment in technology and innovation initiatives, with most expense growth being volume-related due to loan officer additions [28][29] Question: What is the expected run rate for amortization expense going forward? - Management noted that the increase in amortization expense was related to higher refinance volumes and may moderate depending on future interest rates [33][34] Question: Can you discuss the strategy for re-entering the wholesale lending channel? - Management explained that re-entering wholesale lending will allow for greater scale and improved operating efficiency, with expectations for margin expansion as refinance volume returns [40][41] Question: What level of recapture are you targeting going forward? - Management stated that they aim to maintain a recapture rate around 71%, with potential for improvement through technology and AI advancements [42]

Financial Data and Key Metrics Changes - The company reported an adjusted net loss of $21 million in Q4 2025, compared to a loss of $3 million in Q3 2025, primarily due to lower gain on sale margin and higher expenses [10] - Adjusted total revenue for Q4 2025 was $316 million, down from $325 million in Q3 2025 [11] - The company achieved a pull-through weighted lock volume of $7.3 billion in Q4 2025, a 4% increase from $7 billion in Q3 2025 [10] - Loan origination volume reached $8.0 billion in Q4 2025, a 23% increase from $6.5 billion in Q3 2025, marking the highest level since 2022 [12] - Servicing fee income increased slightly from $112 million in Q3 2025 to $113 million in Q4 2025 [13] - Total expenses for Q4 2025 increased by $8 million or 3% from the prior quarter, driven by higher personnel costs [14] Business Line Data and Key Metrics Changes - The company originated fewer higher-margin second trust deeds and FHA, VA loans in Q4 2025, impacting margin percentage [12] - The strategy to capture increased share of refinance volume resulted in larger average loan balances, which decreased margin percentage [12] Market Data and Key Metrics Changes - The company noted that no retail lender currently controls more than 5% market share, indicating significant opportunities for customer-facing scaled originators [5] - The consumer-facing marketplace remains highly fragmented and inefficient, presenting opportunities for growth [5] Company Strategy and Development Direction - The company aims to leverage its digital-first direct lending business and in-market retail business to capture profitable market share [24] - The strategy includes investing in technology and operational efficiency to enhance customer experience and reduce costs [8] - The company plans to return to wholesale lending to achieve greater scale and improve operating efficiency [39] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the potential for a larger refinance market and the company's unique position to outperform competitors [7] - The company is focused on reducing unit costs through automation and investing in marketing to drive customer acquisition [7] - Management highlighted the importance of AI in improving lead acquisition and operational efficiencies [8] Other Important Information - The company ended Q4 2025 with $337 million in cash, a decrease of $222 million from Q3 2025, reflecting investments in loan inventory [17] - The company expects pull-through weighted lock volume in Q1 2026 to be between $7.75 billion and $8.75 billion [15] Q&A Session Summary Question: Can you expand on your profitable share gains and where you're seeing success? - The company has a diversified retail customer touch model, with growth in the builder business and opportunities in direct lending [24][26] Question: What are your expectations for non-volume related OpEx and profitability in 2026? - The company anticipates modest investment in technology and innovation initiatives, with most expense growth being volume-related [28][29] Question: Is the increase in amortization expense a good run rate going forward? - The increase was related to higher refinance volumes, and it may moderate depending on future interest rates [32] Question: Can you discuss the return to the wholesale lending channel? - The company believes returning to wholesale will allow for greater scale and improved margins, especially with anticipated refinance volume growth [39] Question: What level of recapture are you targeting going forward? - The company aims to maintain a recapture rate around 71%, with potential for improvement through technology [40]