loanDepot, Inc. Q2 FY2025 earnings call

• Anthony Hsieh mentioned his focus is to return to roots and drive profitable market share growth and technology-powered efficiency to return to profitability. • Acknowledged LDI Mortgage President Jeff Walsh's retirement, who played a major role in the company's growth. • Discussed loanDepot's unique assets including brand, marketing muscle, servicing portfolio, tech stack, and diversified multichannel origination strategy, highlighting the direct lending channel's role in the flywheel effect. • Announced addition of Chief Digital Officer Dominick Marchetti and Chief Innovation Officer Sean DeJulia to drive digital transformation and innovation. • David Hayes provided financial results overview, noting adjusted net loss improved from $25 million in Q1 2025 to $16 million in Q2 2025, adjusted total revenue increased to $292 million, pull-through weighted gain on sale margin was 330 basis points, and total expenses decreased due to onetime benefits and process improvements.

Pull-through weighted rate lock volume in the second quarter was $6.3 billion, a 17% increase from the prior quarter's $5.4 billion. Origination volume was $6.7 billion, a 30% increase from the prior quarter's $5.2 billion. Servicing fee income increased from $104 million in the first quarter of 2025 to $108 million in the second quarter. Total expenses for the second quarter decreased by $5 million or 2% from the prior quarter. Direct origination expenses were down 7% despite a 30% increase in origination volume.

• Expect pull-through weighted lock volume for third quarter to be between $5.25 billion and $7.25 billion and origination volume between $5 billion and $7 billion. • Anticipate third quarter pull-through weighted gain on sale margin to be between 325 and 350 basis points. • Total expenses expected to increase in third quarter primarily from non-volume-related expenses, but partially offset by lower volume-related expenses.

Q: What steps are needed to drive market share growth?

A: Need to achieve scale, utilize technology to increase efficiency in loan process, with direct lending channel allowing rapid scaling. Also, be prepared to scale up in current market and be opportunistic when rates drop for refinance opportunities.

Q: How is balance being maintained between positioning for scale, driving profitable growth, and debt load/equity capital?

A: The company has stable businesses like servicing and joint venture with homebuilders, and steady growth in in-market loan officers. Direct lending business has opportunity for growth in refinances and second mortgages, with experience in growing profitably in the past and being cautious while enhancing technology tools