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1. Company Snapshot

1.a. Company Description

Blend Labs, Inc.provides cloud-based software platform solutions for financial services firms in the United States.It operates in two segments, Blend Platform and Title365.


The company offers a suite of white-label products for mortgages, home equity loans and lines of credit, vehicle loans, personal loans, credit cards, and deposit accounts.It also provides a suite of mortgage products that facilitates homeownership journey for consumers comprising close, income verification for mortgage, homeowners insurance, and realty.In addition, the company offers title search procedures for title insurance policies, escrow, and other closing and settlement services, as well as other trustee services; and professional and consulting services.


It serves banks, credit unions, financial technology companies, and non-bank mortgage lenders.Blend Labs, Inc.was incorporated in 2012 and is headquartered in San Francisco, California.

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1.b. Last Insights on BLND

Negative drivers behind Blend Labs' recent stock performance include the company's break-even earnings in Q4 2024, despite beating the consensus estimate of $0.01 per share. This is partly due to the company's increasing expenses, resulting in a higher cost of revenue and operating expenses. Additionally, the recent partnership with PHH Mortgage, announced in December 2024, may have been less effective than expected in driving revenue growth. The launch of Rapid Home Lending solutions in February 2025 may also face challenges in delivering significantly faster, more personalized borrower experiences, as mentioned in the press release.

1.c. Company Highlights

2. Blend Labs' Q3 2025 Earnings: Strong Execution Amidst Headwinds

Blend Labs reported total revenue of $32.9 million, down 1% year-over-year, with a non-GAAP gross margin of 78%. The company's non-GAAP operating income was $4.6 million, exceeding the high end of guidance, marking the fifth consecutive quarter of non-GAAP operating profitability. Earnings per share (EPS) came in at -$0.03, relative to estimates of $0.02. The company's financial performance was characterized by a decline in Mortgage Suite revenue, offset by an 11% quarter-over-quarter growth in Consumer Banking Suite revenue.

Publication Date: Nov -17

📋 Highlights
  • Revenue Mix Shift: Consumer Banking revenue grew 11% QoQ (39% of total revenue), offsetting 18% YoY decline in Mortgage Suite to $32.9M total revenue.
  • Non-GAAP Profitability: $4.6M non-GAAP operating income exceeded guidance high-end, driven by 78% non-GAAP gross margin ($25.6M) and $21M operating expenses.
  • Pipeline Growth: 60% YoY pipeline increase with 14 new deals, including 7-figure expansion with a top-20 U.S. bank for solar home equity lending.
  • AI & Rapid Product Momentum: Over 10 Rapid deals in deployment; AI-driven Intelligent Origination solution reduces costs and automates processes, enabling faster home equity loans (10-day LLOC/LO).
  • Cash Reserves & Share Repurchases: $82.3M cash balance, $5M spent repurchasing 1.6M shares, with $15.8M remaining under authorization.

Revenue Mix and Pipeline Activity

The company's revenue mix continues to evolve, with Consumer Banking revenue accounting for 39% of total revenue. Blend signed 14 new deals and expansions, including a 7-figure expansion with a top 20 U.S. bank for solar home equity lending. The pipeline activity is strong, up approximately 60% year-over-year, driven by multiple 7-figure consumer banking deals and sizable top 10 banks in mortgage.

Growth Prospects and Valuation

Blend is focused on driving the adoption of high-value products, expanding the Consumer Banking suite, and building the next horizon of growth through targeted investments in AI and Rapid products. Analysts estimate next year's revenue growth at 19.8%. With a Price-to-Sales Ratio of 5.3, the market is pricing in a certain level of growth. However, the company's Return on Equity (ROE) is -68.63%, and the Return on Invested Capital (ROIC) is -20.91%, indicating that the company is not yet generating returns on its investments.

AI-Powered Growth Opportunities

The company is seeing early success with its Intelligent Origination solution, which uses AI to streamline the loan origination process. Blend views AI as a significant upside opportunity beyond previously shared long-term goals, enabling the company to build solutions with small teams, increasing efficiency and reducing costs. The company is excited about the potential for AI to unlock new monetization opportunities and drive growth.

Guidance and Outlook

3. NewsRoom

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First Look: Insurers, Auto Rules, AI and Fed Jitters

Dec -04

Source: gurufocus.com

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Blend to Present at the Wells Fargo 9th Annual TMT Summit

Nov -11

Source: businesswire.com

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British Land: Bank takes a fresh look and likes what it sees

Nov -07

Source: proactiveinvestors.co.uk

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Blend Labs, Inc. (BLND) Q3 2025 Earnings Call Transcript

Nov -07

Source: seekingalpha.com

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Blend Labs (BLND) Reports Break-Even Earnings for Q3

Nov -06

Source: zacks.com

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Blend Announces Third Quarter 2025 Financial Results

Nov -06

Source: businesswire.com

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Brighton Jones LLC Acquires New Shares in Blend Labs, Inc. $BLND

Nov -02

Source: defenseworld.net

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Blend to Announce Third Quarter 2025 Financial Results on November 6, 2025

Oct -16

Source: businesswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (12.55%)

6. Segments

Blend Platform

Expected Growth: 14.4%

Blend Platform's 14.4% growth is driven by increasing adoption of digital lending solutions, expansion into new markets, and strategic partnerships. The platform's ability to streamline the lending process, reduce costs, and improve customer experience has resonated with financial institutions, leading to increased demand. Additionally, the growing need for digital transformation in the lending industry has contributed to the platform's rapid growth.

Title

Expected Growth: 8.23%

Blend Labs, Inc.'s 8.23% growth is driven by increasing demand for digital lending solutions, expansion into new markets, and strategic partnerships. The company's platform, which streamlines the mortgage process, has seen significant adoption among top lenders, contributing to revenue growth. Additionally, Blend's investment in AI-powered technology has improved operational efficiency, further fueling growth.

7. Detailed Products

Blend Digital Lending Platform

A cloud-based platform that enables lenders to originate, underwrite, and service loans efficiently

Blend Title and Settlement Services

A platform that provides title insurance, settlement, and escrow services for lenders and borrowers

Blend Mortgage Insurance

A platform that provides mortgage insurance products to lenders and borrowers

Blend Consumer Banking Platform

A platform that enables banks and credit unions to offer digital deposit and loan products to consumers

Blend Home Equity Platform

A platform that enables lenders to originate and service home equity loans and lines of credit

8. Blend Labs, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Blend Labs, Inc. operates in a highly competitive industry, but the threat of substitutes is mitigated by the company's strong brand recognition and customer loyalty.

Bargaining Power Of Customers

Blend Labs, Inc. has a large customer base, but the bargaining power of customers is high due to the availability of alternative products and services.

Bargaining Power Of Suppliers

Blend Labs, Inc. has a diversified supplier base, which reduces the bargaining power of suppliers and minimizes the risk of supply chain disruptions.

Threat Of New Entrants

The threat of new entrants in the industry is moderate, as there are barriers to entry such as high capital requirements and regulatory hurdles.

Intensity Of Rivalry

The industry in which Blend Labs, Inc. operates is highly competitive, with many established players and a high level of rivalry.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 115.59%
Debt Cost 9.50%
Equity Weight -15.59%
Equity Cost 9.50%
WACC 9.50%
Leverage -741.64%

11. Quality Control: Blend Labs, Inc. passed 5 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Red Violet

A-Score: 5.5/10

Value: 0.9

Growth: 8.7

Quality: 7.6

Yield: 1.0

Momentum: 9.5

Volatility: 5.0

1-Year Total Return ->

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Stock-Card
Dave

A-Score: 4.8/10

Value: 1.1

Growth: 8.0

Quality: 8.7

Yield: 0.0

Momentum: 10.0

Volatility: 1.3

1-Year Total Return ->

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Stock-Card
Blend Labs

A-Score: 4.1/10

Value: 8.4

Growth: 6.2

Quality: 3.2

Yield: 0.0

Momentum: 5.0

Volatility: 2.0

1-Year Total Return ->

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Stock-Card
American Software

A-Score: 4.1/10

Value: 2.6

Growth: 3.0

Quality: 6.1

Yield: 5.0

Momentum: 5.0

Volatility: 2.7

1-Year Total Return ->

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Stock-Card
Viant Technology

A-Score: 3.9/10

Value: 6.2

Growth: 8.0

Quality: 5.3

Yield: 0.0

Momentum: 1.5

Volatility: 2.3

1-Year Total Return ->

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Stock-Card
Wag

A-Score: 3.8/10

Value: 10.0

Growth: 6.3

Quality: 6.5

Yield: 0.0

Momentum: 0.0

Volatility: 0.0

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

3.11$

Current Price

3.11$

Potential

-0.00%

Expected Cash-Flows