BETR Q1 2026 Earnings Call Summary

1. Key Financial Results and Metrics

Funded Loan Volume: $1.64 billion, an 89% increase year-over-year and exceeding guidance.
Revenue: $47.5 million from continuing operations, up 52% year-over-year.
Adjusted EBITDA Loss: Approximately $19 million, a 48% improvement year-over-year.
Expense Growth: Total expenses grew by 27% year-over-year, indicating operating leverage.
Product Mix: 50% refinance, 36% purchase, and 12% home equity in funded loan volume.

2. Strategic Updates and Business Highlights

AI Platform Growth: The Tinman AI platform accounted for 50% of total funded loan volume, up from 44% in Q4 2025.
Partnership Expansion: Significant growth in partnerships, including Credit Karma and other fintechs, which leverage existing customer ecosystems.
Product Innovations: Launched the Better Home Equity card and a crypto-backed mortgage product in partnership with Coinbase.
Cost Management: Announced a $25 million annualized cost reduction initiative and expanded warehouse capacity by 48% to $850 million.

3. Forward Guidance and Outlook

Q2 2026 Guidance: Funded loan volume expected between $1.575 billion and $1.725 billion, representing 37% year-over-year growth. Revenue projected at $53 million to $56 million (28% growth year-over-year).
Adjusted EBITDA Loss: Expected to range from $12.5 million to $14 million, indicating a 42% year-over-year improvement.
Breakeven Target: Management remains committed to achieving adjusted EBITDA breakeven by the end of Q3 2026, contingent on macroeconomic conditions.

4. Bad News, Challenges, or Points of Concern

Macro Environment Impact: Rising interest rates due to geopolitical tensions have led to decreased conversion rates, with consumers hesitant to lock in higher rates.
Conversion Rates: Lower than anticipated due to macro factors, impacting the ability to meet the previously set $1 billion monthly funded volume target.
Market Volatility: The prolonged conflict in the Middle East presents uncertainty, affecting consumer behavior and the overall mortgage market.

5. Notable Q&A Insights

Macro Assumptions: Management is assuming no resolution to current geopolitical tensions in their guidance, indicating a conservative outlook.
HELOC Product Economics: HELOCs have a higher gain on sale rate (6-7 points) compared to traditional mortgages (2.5-3.5 points), which helps offset volume declines.
Partnership Ramp-Up: New partnerships are seeing strong engagement, with a significant increase in top-of-funnel volume.
Operational Efficiency: The use of AI tools like Betsy is expected to enhance operational efficiency and customer engagement, allowing Better to scale effectively in response to demand spikes.

Overall, while BETR reported strong growth in funded loan volume and revenue, challenges from the macroeconomic environment and rising interest rates pose risks to future performance. The company is focused on strategic partnerships and cost management to navigate these headwinds while aiming for profitability by Q3 2026.

BETR — Better Home & Finance Holding Company