In addition to signing a multi-year contract with the Department of Defense Federal Credit Union, Blend laid off 50 employees in September, representing about 9% of its workforce.
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Cloud banking software provider Blend Labs Inc. continues its steady drive to improve profitability by reducing its workforce, signing new customers and expanding services to existing customers.
Blend, which helps mortgage lenders process about one in five mortgages, saw third-quarter revenue increase 11% year-over-year to $45.2 million. By reducing operating expenses by 32% to $39.3 million, the company was able to narrow its third-quarter net loss to $2.6 million from $19.4 million in the second quarter. reported Wednesday.
Blend announced in September that it had laid off 50 people, or about 9% of its workforce, as part of a layoff plan expected to be completed by the end of the year.
We also entered into a multi-year mortgage and home equity agreement with Pentagon Federal Credit Union, the nation’s second largest credit union, and strengthened our credit card, auto and personal loan offerings with top 300 financial institutions. Signed a contract.
Blend CEO Nima Ghamsari said the company achieved “non-GAAP operating income” in the quarter, with operating revenue exceeding expenses by $39,000.
“The third quarter saw significant milestones including signing new multi-year contracts in both our mortgage and consumer banking businesses and achieving non-GAAP operating margin ahead of our fourth quarter target. , some big wins for Blend,” Ghamsari said in a statement.
Blend said it expects revenue of $39.5 million to $42.5 million in the final quarter of this year, with non-GAAP net operating income of up to $3 million.
“This achievement reflects the dedication, focus and hard work of the entire team,” Gamsari said. “Achieving this milestone allows us to enter the next phase of our growth strategy. We are confident that we will generate profitable growth and ensure that our platform delivers even more value to our customers over time.” Our focus is on ensuring that we continue to deliver.”
blend stockswhich has traded as low as $1.16 and as high as $4.25 over the past year, closed at $3.86 before Wednesday’s earnings release, up 3% in after-hours trading.
Blend’s cumulative deficit was $1.384 billion as of September 30, after posting cumulative losses of more than $1 billion in 2021, 2022, and 2023.
Blend your earnings by income source
Blend provides a suite of tools to help banks and lenders process applications for mortgages, home equity loans and lines of credit, auto loans, personal loans, credit cards, and savings accounts.
Most of the company’s revenue (69 percent during the third quarter) comes from services it provides to mortgage lenders.
By adding new customers and offering more services to existing customers, Blend increased revenue from its mortgage suite by 16% from the second quarter to $21.5 million.
Revenue per mortgage increased 13% year over year
Blend offers a suite of products that lenders can choose from to support their loan origination process, including data collection, validation checks, product selection, pricing, pre-approval, disclosure filings, and closing document signing. I am.
Due to increased adoption of add-on products by lenders, Blend increased the “economic value” of each mortgage it helps customers process to $99 in the third quarter, up from $86 a year earlier.
Blend estimated that it contributed to processing 20% of all mortgage loans originated in 2024, up from 14% in 2021.
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