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Blend Labs, Inc. reported its Q1 2025 earnings Thursday, touting a turnaround as its financial losses narrowed, deal pipeline strengthened and it landed major clients while sharpening its focus to become “software-first.”
SEC filings show that Blend’s platform revenue for the first quarter came in at $26.8 million, nearly all of which was from its software platform business ($24.3 million). While the revenue was a 12% ($2.9 million) improvement year over year, the quarter marked a decline from Blend’s $41.4 million reported in Q4 2024.
Overall, Blend lost $9.2 million in the first quarter.
“We’re delivering strong results across the business—closing nearly three times as many deals as this time last year, deepening relationships with top-tier institutions, and driving strong adoption of our rapid home lending solutions,” said Nima Ghamsari, Blend’s co-founder and CEO.
“This progress signals a market that’s re-energizing and investing in what’s next. With a pipeline nearly double what it was a year ago—and demand coming from across the industry, from leading banks and mortgage servicers to independent mortgage banks and credit unions — it’s clear the need for effortless, personalized banking and lending is only growing.”
Strategic themes driving Blend’s trajectory
During the earnings call, Ghamsari spotlighted not only Blend’s internal wins and growing partnerships but also notable industry developments from the first quarter. He reiterated the company’s shift toward becoming a “software-first” business and stressed ongoing efforts to improve its financial performance.
“There are three themes I want to cover today. First, our continued shift towards becoming a software-first company. Second, the Rocket/Mr. Cooper deal is a catalyst for the industry; and third, how that shift is helping fuel the strong momentum in Q1,” he said.
In tandem with the first “theme” Ghamsari outlined, he shared that Blend is in an “exclusive process” with a title and mortgage services provider for the potential sale of its title insurance business, Title365, which it had acquired in 2021 from Mr. Cooper for $422 million.
Ghamsari said the Rocket/Mr. Cooper deal demonstrated the intelligence of Blend’s strategy.
“[Rocket and Mr. Cooper’s] creation of an end-to-end platform underscores the increasing expectation of borrowers to be treated as valued customers, demanding personalized experiences, acknowledging their ongoing relationship with financial institutions. This strategic move powerfully validates our long-standing mission of a unified digital mortgage experience, which inherently focuses on creating more personalized and customer-centric interactions.”
Still, there could be financial concerns related to the deal over the short- and medium-term. According to analysts at Keefe Bruyette Woods, 17% of Blend’s revenue in 2024 came from Mr. Cooper.
Roughly 47% of Blend’s Title365 revenue contribution ($21.6 million) in 2024 came from Mr. Cooper, which still owns a 9.9% stake in the title business.
Blend’s financial disclosures also imply that Mr. Cooper represented ~5% of Blend Platform revenue in 2024. The contract with Mr. Cooper on its point-of-sale (POS) business runs through the first half of 2028 with undisclosed minimum volume commitments. Because Rocket historically runs its origination software in-house, analysts expect that Rocket will not renew the deal in 2028.
On the positive side, Ghamsari said there were big renewals and expansions with unnamed financial institutions.
“I’d like to announce our largest deal ever, a $50 million renewal and expansion with a top financial institution that we signed early in Q2. This is a multi-product deal that shows our ability to scale with our customers over time and hopefully serve as the blueprint for other customers as they add more product lines with us,” he said. “In Q1, we signed a top-five mortgage servicer, a top-10 mortgage originator across our mortgage home and home equity end-closed solutions. These customers will typically deploy in two quarters or so.”
He continued, “Notably, we’ve partnered with yet another top 25 credit union by asset size and institution, serving over 400,000 members to spearhead a comprehensive multi-year transformation.”
