loanDepot Q1 Earnings Call Highlights

Key Points

• loanDepot’s Q1 adjusted loss widened to $34 million from $21 million in the prior quarter as lower gain-on-sale margins and higher interest rate volatility pressured results. Revenue also fell to $299 million, while the company said product mix shifts toward conventional loans hurt margins.
• Despite weaker profitability, loanDepot said it gained market share and saw origination volume of $7.7 billion, near the high end of guidance. Management credited the improvement to adding loan officers, relaunching wholesale lending and sharpening marketing efficiency.
• The company expects a margin rebound in Q2, with gain-on-sale margins forecast at 330 to 360 basis points and higher origination volume. Management says the 5x5 HomeLoan and Figure Technology partnership should support growth and a shift toward more profitable loan mix.

loanDepot NYSE: LDI reported a wider adjusted loss for the first quarter of 2026 as lower gain-on-sale margins and interest rate volatility weighed on revenue, even as the mortgage lender said it continued to gain market share and invest in growth initiatives.

Chief Executive Officer Anthony Hsieh said the company is “three quarters into the rebuild” and has focused on long-term growth initiatives including the addition of more than 100 loan officers, the relaunch of its wholesale business and a new partnership with Figure Technology Solutions.

“Despite a volatile market environment, these initiatives help us increase market share during the quarter, which I consider vital to our goal of achieving consistent profitability in the current market,” Hsieh said.

Adjusted Loss Widens as Margins Compress

Chief Financial Officer David Hayes said loanDepot reported an adjusted net loss of $34 million in the first quarter, compared with an adjusted net loss of $21 million in the fourth quarter of 2025. He attributed the change primarily to a lower pull-through weighted gain-on-sale margin, partially offset by lower expenses.

Adjusted total revenue was $299 million, down from $316 million in the prior quarter. Pull-through weighted rate lock volume was $8.3 billion, up 14% from $7.3 billion in the fourth quarter and within the company’s prior guidance range of $7.75 billion to $8.75 billion.

Loan origination volume was $7.7 billion, down 5% from $8 billion in the prior quarter, but at the high end of the company’s guidance range of $6.75 billion to $7.75 billion. Hayes said closed loan volume represented a market share increase, reflecting the company’s investment in adding loan officers.

The company’s pull-through weighted gain-on-sale margin was 271 basis points, at the low end of its guidance range of 270 to 300 basis points and down from 324 basis points in the prior quarter. Hayes said the decline reflected interest rate volatility and a shift in product mix, including fewer higher-margin FHA, VA and HELOC loans and more conventional loans.

“The geopolitical environment created a sharp increase in interest rates during the first quarter,” Hayes said, adding that higher rates also generated wider negative fair value marks on mortgage servicing and trading securities.

Expenses Decline Despite Hiring

Total expenses decreased by $565,000 from the fourth quarter, despite the company’s previous guidance for higher expenses. Hayes said the decline was driven by lower commissions following the implementation of more efficient commission strategies and a 12% reduction in marketing expenses.

Hsieh said loanDepot sharpened its marketing strategy to drive more lock volume while reducing marketing costs, increasing its return on marketing. Hayes said salary-related expenses rose because of higher headcount and seasonal employment tax resets, while direct origination expenses increased as vendors raised credit reporting costs.

The company ended the quarter with $277 million in cash, down $60 million from the fourth quarter. Hayes said the decline reflected the net loss, investment in servicing rights and timing differences related to mortgage servicing rights secured loans.

Figure Partnership and 5x5 HomeLoan Expected to Drive Mix Shift

loanDepot highlighted its partnership with Figure Technology Solutions as a key part of its digital strategy. Hsieh said the company integrated Figure’s credit and loan underwriting engine into loanDepot’s mello technology platform, allowing it to offer new home loan products.

The company is emphasizing its 5x5 HomeLoan product, which Hsieh said can deliver approval in as little as five minutes and funding in as few as five days. He said the product is designed to serve borrowers seeking speed and convenience and is expected to reduce production costs as it is integrated across channels.

Hayes said the product is also affecting the company’s second-quarter guidance because HELOC products do not involve an interest rate lock. As a result, expected volume from those loans is not included in lock volume guidance but is included in closed origination volume guidance.

In response to a question from Bank of America analyst Mihir Bhatia, Hayes said the expected increase in gain-on-sale margin in the second quarter is “first and foremost” tied to the 5x5 product, which carries a stronger gain-on-sale margin. He also said the company is seeing product mix shift back toward FHA, VA and higher home equity volumes.

Second-Quarter Outlook Calls for Higher Originations

For the second quarter, loanDepot expects pull-through weighted lock volume of $5.75 billion to $7.75 billion and origination volume of $7.25 billion to $9.25 billion. The company expects pull-through weighted gain-on-sale margin of 330 to 360 basis points.

Hayes said total expenses are expected to increase in the second quarter, primarily because of higher volume-related costs tied to higher expected originations.

Servicing fee income declined to $109 million in the first quarter from $113 million in the fourth quarter, which Hayes attributed mainly to lower interest earnings from custodial balances and fewer days in the quarter. The company’s recapture rate rose to 73% from 71% in the prior quarter.

Management Reiterates Profitability Goal

Hsieh said the company remains focused on returning to consistent profitability regardless of rate movements, though he said falling rates would shorten the timeline. He said loanDepot plans to continue investing in customer acquisition, origination capacity, technology and artificial intelligence to improve efficiency and lower costs.

In response to a question from Citizens JMP analyst Mikhail Goberman about whether a substantial decline in mortgage rates is needed for earnings to improve, Hsieh said the company would benefit from a lower 10-year yield but remains “quite bullish” based on progress in market share, top-line growth and marketing efficiency.

Hayes also addressed a question about upcoming debt maturities, saying management and the board are actively engaged and discussing strategies with bankers. He said the company hopes to have a resolution “in the coming months,” while noting that markets remain turbulent.

Hsieh closed the call by reiterating four objectives: investing in growth and infrastructure, becoming a more efficient mortgage banker, growing profitable market share and returning to profitability through origination growth, servicing portfolio expansion, higher recapture rates, brand investment and operating leverage.

About loanDepot NYSE: LDI

loanDepot, Inc NYSE: LDI is a leading non-bank consumer lender that provides a broad range of home and personal financing products through a digitally enabled platform. The company specializes in originating and servicing purchase and refinance mortgage loans, home equity lines of credit (HELOCs), and personal loans. Through its proprietary mello™ technology suite, loanDepot streamlines the application, underwriting, and closing processes for borrowers and real estate professionals, emphasizing speed, transparency, and a seamless digital experience.

Founded in 2010 by Anthony Hsieh, loanDepot has grown rapidly to become one of the largest independent mortgage lenders in the United States.

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