loanDepot, Inc. Q4 FY2025 earnings call

• Anthony Shea mentioned the fourth quarter had most volume since 2022, gained market share, and achieved 71% recapture rate from in-house servicing platform. - Believes market consolidation benefits large-scale diversified customer-facing originators like Loan Depot, and digital migration of customers, especially purchase customers, will accelerate. - Distribution model includes visually enabled direct-to-consumer nationwide in-market retail and partnership with home builders. - Vertical integration means controlling consumer experience end to end through industry-leading recapture capabilities, technology assets, customer service, and brand. - Digital team introduced AI capabilities to improve lead acquisition, conversions, loan officer CRA management, and underwriting processes, with positive impact and wide user acceptance. - Goal is to deliver profitable market share growth, improve customer experience, drive retention, and create long-term shareholder value.

Fourth quarter: Pull-through weighted lock volume was $7.3 billion (4% increase from prior quarter's $7 billion), within guidance of $6 billion to $8 billion. Loan origination volume was $8.0 billion (highest since 2022, 23% increase from prior quarter's $6.5 billion, within guidance of $6.5 billion to $8.5 billion). Ultra-weighted gain on sale margin was 324 basis points (high end of guidance range 300 to 325 basis points, down from prior quarter's 339 basis points) due to product and loan purpose mix shift. Thirteen fee income increased from $112 million in third quarter to $113 million in fourth quarter. Total expenses increased by $8 million (3%) from prior quarter, driven by higher personnel costs but partially offset by lower volume-related marketing and direct origination expenses. First quarter expectation: Pull-through weighted lock volume between $7.75 billion and $8.75 billion, origination volume between $6.75 billion and $7.75 billion, pull-through weighted gain on sale margin between 270 and 300 basis points. Total expenses expected to increase in first quarter, primarily driven by personnel and G&A expenses, somewhat offset by lower volume-related expenses. Full year 2025: Adjusted revenue increased 10% year-over-year, expense growth limited to less than 1%, adjusted net loss shrunk by 31%.

• First quarter pull-through weighted lock volume expected between $7.75 billion and $8.75 billion, origination volume between $6.75 billion and $7.75 billion, pull-through weighted gain on sale margin between 270 and 300 basis points. - Guidance reflects market volatility, seasonality in purchase volume, affordability and availability of homes, mortgage interest rates, and strategy of targeting larger average refinance loan balances. - Total expenses expected to increase in first quarter, primarily driven by personnel and G&A expenses, somewhat offset by lower volume-related expenses. - Full year 2025 showed adjusted revenue increased 10% year-over-year, expense growth limited to less than 1%, adjusted net loss shrunk by 31%, entering 2026 as a stronger company.

Q: Taylor on for Madison asked about profitable share gains, where success is seen and improvement in 2026.

A: Loan Depot has diversified retail customer touch model with digital first direct lending, in-market retail, and builder business. Builder business is steady, retail and market business has opportunities to rebuild marketing funnel, direct lending channel is seeing early wins in volume and market share improvement.

Q: Eric Hagan with BTIG asked about pickup in amortization expense and cash-out refis.

A: Amortization expense pickup in quarter related to higher refinance volumes, may moderate in first quarter depending on rates. Cash-out refi volume shifts with mortgage rates, CES margin has higher basis points for lower loan amount.

Q: Mikael Goberman with Citizens GMP asked about getting back into wholesale lending channel.

A: Getting back into wholesale to achieve greater scale, utilize volume for operating efficiency, expect margins to expand with volume growth and refinance volume return.

Q: Mikael Goberman also asked about recapture rate target.

A: Recapture rate around 71% last quarter, could go up with technology changes and AI, currently at top of house.