Better Home & Finance Q2 Earnings Call Highlights

Key Points

• Second-quarter performance improved: Loan volume rose 38% year over year to $1.67 billion, while revenue increased 28% to $54.7 million and the adjusted EBITDA loss narrowed to $14 million. HELOCs grew to 18% of volume as elevated rates continued to weigh on refinancing.
• Near-term outlook is cautious: Better forecast third-quarter loan volume of $1.375 billion to $1.525 billion and revenue of $49 million to $52 million, while acknowledging it will miss its prior September adjusted EBITDA breakeven target. The company raised its annual cost-savings goal to more than $45 million.
• Strategy and leadership are shifting: Interim CEO Daniel Lewis replaced founder Vishal Garg, with a permanent CEO search underway. Better expects new HELOC partnerships to begin contributing in the fourth quarter and is prioritizing lower-cost API and white-label integrations.

Better Home & Finance NASDAQ: BETR reported higher loan volume and revenue for the second quarter of 2026, while outlining a more cautious third-quarter outlook amid elevated mortgage rates, delayed partnership launches and a muted refinancing market.

The company also disclosed a leadership transition, with Daniel Lewis serving as interim chief executive officer following the board’s decision to replace founder Vishal Garg in the role. Lewis said the board has retained a search firm to identify a permanent CEO, while giving him authority to execute the company’s strategic plan. He said there is “no formal strategic alternatives process at this time.”

Second-Quarter Results and Product Mix

Chief Financial Officer Loveen Advani said Better’s second-quarter loan volume rose 38% year over year to $1.67 billion. Total net revenue increased 28% from a year earlier and 15% sequentially to $54.7 million.

Adjusted EBITDA loss narrowed to $14 million, improving 39% year over year and 26% from the first quarter. Advani noted that the result included a one-time $6.5 million trade reserve release associated with loans originated before June 2022.

The company’s product mix continued shifting toward home equity lines of credit, or HELOCs, as higher interest rates constrained refinancing activity. HELOCs represented 18% of second-quarter loan volume, compared with 12% in the prior quarter. Advani said HELOC loans generally have smaller average balances than first-lien mortgages but generate higher average revenue per loan.

• Refinance volume increased 239% year over year to $549 million.
• Home equity volume rose 23% to $294 million.
• Purchase loan volume increased 3% to $824 million.
• Purchase loans represented 49% of total quarterly volume, refinancings accounted for 33%, and home equity accounted for 18%.

By channel, 55% of loan volume originated through the company’s Tinman AI platform and 45% came from direct-to-consumer operations. Better’s NEO business, which recruits loan officer teams, grew loan volume 60% year over year during the quarter, according to Advani.

Third-Quarter Outlook Falls Short of Prior Breakeven Goal

For the third quarter, Better forecast loan volume of $1.375 billion to $1.525 billion, total net revenue of $49 million to $52 million, and an adjusted EBITDA loss of $18 million to $15 million. At the midpoint, the company said the guidance implies 20% year-over-year loan-volume growth, 22% revenue growth and a 28% improvement in adjusted EBITDA loss.

Lewis said Better now expects to miss its previously stated target of reaching adjusted EBITDA breakeven by September. Rather than setting a new date, he said management plans to report progress quarterly because profitability will depend on transaction volumes, revenue mix, partnership timing and the pace of cost reductions.

“Sustainable profitability is a clear priority,” Lewis said, adding that the company aims to strengthen its financial position without limiting growth opportunities.

Advani said operating expenses, excluding the trade reserve item, were about $75 million in the second quarter. At the midpoint of third-quarter guidance, operating expenses are expected to be approximately $67 million, representing about $8 million in sequential savings. He said many cost-cutting actions were initiated late in the second quarter and therefore did not fully affect that period’s results.

Better increased its expected annual cost savings to more than $45 million, up from its previous $25 million target. Lewis said the company is combining its NEO and Better Mortgage operations as part of an effort to simplify operations and focus engineering resources and capital allocation on fewer priorities.

HELOC Partnerships Expected to Contribute in Fourth Quarter

Management said third-quarter guidance does not include contributions from new HELOC partnership launches. Lewis said Better has signed HELOC partnerships, but their launch schedules are controlled partly by large enterprise customers and are not expected to affect the third quarter.

“Multiple partnerships should start to kick in HELOC in the fourth quarter,” Lewis said in response to an analyst question.

The company plans to prioritize enterprise partners that can connect to Tinman through its API-driven model, including consumer platforms, wholesale brokers and other businesses whose customers can move onto the platform. Lewis specifically cited Credit Karma, Coinbase and Better’s NEO operation as parts of its distribution strategy.

Better also is preparing to launch Tinman for independent mortgage brokers in the wholesale channel, with Lewis indicating that activity could begin toward the end of September. He said the company is de-emphasizing enterprise integrations that require replacing existing systems and training outside loan officers, describing those arrangements as having long sales cycles and high support costs.

Instead, the company intends to focus on white-label and API-based partnerships that can be implemented more efficiently. Lewis said Better’s pricing approach will emphasize contribution margin rather than loan volume alone. Advani said the company targets incremental contribution margins of 20% to 25% across products and channels.

Liquidity and Leadership Transition

Better ended the quarter with approximately $102 million of cash and cash equivalents, plus $10 million of restricted cash. Warehouse capacity totaled about $850 million, a 48% increase from year-end 2025.

The company continues to pursue the sale of its U.K. bank subsidiary, Birmingham Bank, through a process led by FD Partners. Advani said Better would provide an update if there is a material development.

Lewis said he will receive the minimum salary allowed by law and no cash bonus during his interim tenure. His compensation is expected to consist of performance-based equity, with final terms to be determined by the board and disclosed in public filings. He also said Better’s directors have elected to receive their compensation in equity rather than cash.

About Better Home & Finance (NASDAQ:BETR)

Better Home & Finance Holding Co engages in the provision of comprehensive homeownership services. It offers mortgage loans, real estate agent services, and title and homeowner's insurance services. The company was founded in 2014 and is headquartered in New York, NY.

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