loanDepot Announces First Quarter 2025 Financial Results
Q1 was a quarter of positive momentum for the company.
Higher volume, margins and ongoing cost discipline drive improved Q1 results.
Company Founder and Executive Chairman Anthony Hsieh also returned to the company's day-to-day operations in Q1; Hsieh will focus on expanding originations and driving innovation through tech enablement.
Current CEO Frank Martell set to transition to a board advisory role in June; Hsieh will assume interim CEO role at that time.
Highlights:
-- Revenue increased 23% to $274 million and adjusted revenue increased 21%
to $278 million compared to the prior year on higher volume and
pull-through weighted gain on sale margin.
-- Strong mortgage revenue growth more than overcame loss of $20 million of
servicing revenue resulting from 2024 MSR bulk sales.
-- Pull-through weighted gain on sale margin grew 81 basis points to 355
basis points.
-- Expenses increased 4% to $320 million, driven primarily by increased
volume-related costs; non-volume related expenses decreased 3% to $218
million.
-- Net loss of $41 million was down 43%, compared with net loss of $72
million in the prior year.
-- Adjusted net loss of $25 million was down 34%, compared with the prior
year adjusted net loss of $38 million, primarily reflecting higher
adjusted revenue.
-- Adjusted EBITDA increased $16 million to $18 million compared to $2
million in the prior year.
-- Strong liquidity profile with cash balance of $371 million.
-- Founder and noted transformative leader Anthony Hsieh, an innovator in
tech-forward consumer direct lending, has returned to the company's
day-to-day operations and is expected to focus on expanding originations
and driving growth.
IRVINE, Calif.--(BUSINESS WIRE)--May 06, 2025--
loanDepot, Inc. (NYSE: LDI), (together with its subsidiaries, "loanDepot" or the "Company"), a leading provider of products and services that power the homeownership journey, today announced results for the first quarter ended March 31, 2025.
"I would like to thank Team loanDepot for their dedication and support over these past three years," said President and Chief Executive Officer Frank Martell. "Together as a team, we addressed the realities of the market while investing in critical systems, products, and processes; these investments will allow loanDepot to take advantage of our marketplace differentiators in this and upcoming cycles, as well as to continue to deliver a best-in-class customer experience. I am proud to have been a part of loanDepot and look forward with confidence to the company's future success."
"On behalf of the entire board of directors, I would like to thank Frank for his leadership over the past three years," said Founder and Executive Chairman of the Board Anthony Hsieh. "Frank is a man of honor and a servant leader -- his care for Team loanDepot and the customers we serve is evident."
"As we go forward," continued Hsieh, "the team and I will focus on capitalizing upon the things that already make loanDepot great. Our multi-channel sales model, proprietary mello tech stack, wide product array, powerful brand muscle and our servicing business are foundational places in which loanDepot can win. By leveraging this unique constellation of assets, plus adding to our arsenal with new and emerging technologies and platform refinements, I believe we are well positioned to regain profitable market share and scale our business."
"We deeply appreciate all that Frank Martell brought to our company, and are energized by Anthony's return," said Chief Financial Officer David Hayes. "Under Frank's guidance, the first quarter reflected the benefits of our investment in growth generating initiatives, despite the adverse impact of lower servicing revenue stemming from our 2024 MSR bulk sales. Our home equity-linked products supported strong margin and volume increases, growing revenue by 23%. On the cost side, aligned with our enduring discipline in expense management, our non-volume expenses decreased 3% year-over-year."
"As Anthony and I work together moving forward," continued Hayes, "we remain focused on our commitment to profitability and disciplined approach to growing revenue and market share while maintaining ample cash and a strong balance sheet."
First Quarter Highlights:
Financial Summary
Three Months Ended
----------------------------------------------
($ in thousands
except per share Mar 31, Dec 31, Mar 31,
data) (Unaudited) 2025 2024 2024
-------------- -------------- --------------
Rate lock volume $7,637,987 $7,648,829 $6,802,330
Pull-through
weighted lock
volume(1) 5,418,685 5,592,527 4,731,836
Loan origination
volume 5,173,928 7,188,186 4,558,351
Gain on sale
margin(2) 3.72% 2.60% 2.84%
Pull-through
weighted gain on
sale margin(3) 3.55% 3.34% 2.74%
Financial Results
Total revenue $ 273,620 $ 257,464 $ 222,785
Total expense 319,723 341,588 307,950
Net loss (40,696) (67,466) (71,505)
Diluted loss per
share $ (0.11) $ (0.17) $ (0.19)
Non-GAAP Financial
Measures(4)
Adjusted total
revenue $ 278,443 $ 266,594 $ 230,816
Adjusted net loss (25,335) (47,017) (38,144)
Adjusted EBITDA
(LBITDA) 18,298 (15,071) 2,340
(1) Pull-through weighted rate lock volume is the principal balance of
loans subject to interest rate lock commitments, net of a pull-through
factor for the loan funding probability.
(2) Gain on sale margin represents the total of (i) gain on origination and
sale of loans, net, and (ii) origination income, net, divided by loan
origination volume during period.
(3) Pull-through weighted gain on sale margin represents the total of (i)
gain on origination and sale of loans, net, and (ii) origination
income, net, divided by the pull-through weighted rate lock volume.
(4) See "Non-GAAP Financial Measures" for a discussion of Non-GAAP
Financial Measures and a reconciliation of these metrics to their
closest GAAP measure.
Year-over-Year Operational Highlights
-- Non-volume1 related expenses decreased $7.4 million from the first
quarter of 2024, primarily due to lower general and administrative and
other interest expenses.
-- Accrued $0.8 million expense associated with the first quarter 2024
cybersecurity incident (the "Cybersecurity Incident") compared to $14.7
million in the first quarter of 2024.
-- Pull-through weighted lock volume of $5.4 billion for the first quarter
of 2025, an increase of $0.7 billion or 15% from the first quarter of
2024.
-- Loan origination volume for the first quarter of 2025 was $5.2 billion,
an increase of $0.6 billion or 14% from the first quarter of 2024.
-- Purchase volume totaled 59% of total loans originated during the first
quarter, down from 72% during the first quarter of 2024.
-- Our preliminary organic refinance consumer direct recapture rate2
increased to 65% from the first quarter 2024's recapture rate of 59%.
-- Net loss for the first quarter of 2025 of $40.7 million as compared to
net loss of $71.5 million in the first quarter of 2024. Net loss narrowed
primarily due to higher volume and margins, offset somewhat by lower
servicing revenue and increased expenses.
-- Adjusted net loss for the first quarter of 2025 was $25.3 million as
compared to adjusted net loss of $38.1 million for the first quarter of
2024.
_________________
(1) Volume related expenses include commissions, marketing and advertising
expense, and direct origination expense. All remaining expenses are
considered non-volume related.
(2) We define organic refinance consumer direct recapture rate as the total
unpaid principal balance ("UPB") of loans in our servicing portfolio
that are paid in full for purposes of refinancing the loan on the same
property, with the Company acting as lender on both the existing and
new loan, divided by the UPB of all loans in our servicing portfolio
that paid in full for the purpose of refinancing the loan on the same
property. The recapture rate is finalized following the publication
date of this release when external data becomes available.
Outlook for the second quarter of 2025
-- Origination volume of between $5.0 billion and $7.5 billion.
-- Pull-through weighted rate lock volume of between $5.5 billion and $8.0
billion.
-- Pull-through weighted gain on sale margin of between 300 basis points and
350 basis points.
Servicing
Three Months Ended
---------------------------------
Servicing Revenue Data:
($ in thousands) Mar 31, Dec 31, Mar 31,
(Unaudited) 2025 2024 2024
--------- --------- -----------
Due to
collection/realization of
cash flows $(36,176) $(43,227) $(35,999)
Due to changes in valuation
inputs or assumptions (23,689) 68,228 28,244
Realized gains (losses) on
sale of servicing rights 62 (56) 44
Net gain (loss) from
derivatives hedging
servicing rights 18,804 (77,302) (36,319)
------- ------- -------
Changes in fair value
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