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Blend Labs helps U.S. banks, credit unions and other lenders move mortgage applications through to closing online. Its software collects applicant information, connects verification services and coordinates the steps with lenders’ back-office systems. Mortgage software generates most of its revenue; consumer banking software supports home-equity lending, deposit-account opening and other borrowing. Blend Builder lets institutions configure these workflows or build custom ones.
Financial institutions pay for access to the platform and for completed transactions, such as funded loans or new accounts. Transaction charges depend on the software components used, not the loan’s dollar value. Blend does not charge for abandoned or rejected applications, although processing them still costs it money.
The business depends heavily on mortgage transaction volumes, which respond to interest rates and credit availability. A relatively small group of large customers supplies most of its revenue. Bank oversight and privacy requirements also shape deployment and data use, and can restrict services or customer relationships.
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Blend's results hinge on U.S. mortgage origination volumes and banks' adoption and use of its digital lending and account-opening software.
Zillow Group and Blend both depend on housing transaction activity: Blend charges financial institutions for completed mortgage workflows, while Zillow connects homebuyers with agents, sells advertising and software to property professionals, and offers mortgage financing to borrowers. Zillow's mortgage financing business is the part to watch for clues about the lending activity that drives much of Blend's revenue.
Fed Interest Rate Decision
Blend’s Fed rate decision tracks the central bank’s benchmark borrowing rate; through mortgage customers’ borrowing and refinancing activity, it can change loan transactions on Blend’s platform and the transaction fees Blend earns when loans are completed.
Expected4.0%Last release4.0%
If it comes in above expectations
If the Fed’s policy rate is higher than expected, costlier borrowing may reduce mortgage applications and completed loans at Blend’s financial-institution customers, leaving fewer transactions that generate fees for Blend.
If it comes in below expectations
If the Fed’s policy rate is lower than expected, cheaper borrowing may support mortgage applications and completed loans at Blend’s financial-institution customers, increasing transactions that generate fees for Blend.
Zillow Group, Inc. earningsZ
Zillow Group’s report will show what its mortgage business sees in borrower demand and lending activity, offering a clue to the mortgage transaction market Blend relies on.
Look at lending activity or loan volume in Zillow’s mortgage business. An increase would suggest borrower demand and completed lending are improving, supporting the market for Blend’s fees on completed mortgage workflows; weakness would suggest mortgage volume may continue to constrain those fees. Zillow’s results do not directly establish loan volumes at Blend’s customers.
Blend Labs, Inc. earningsThis company
Blend charges financial institutions for completed mortgage and banking transactions, and this report will show whether mortgage revenue can stabilize alongside Consumer Banking growth.
Read Mortgage Suite revenue alongside Consumer Banking Suite revenue and the number of mortgage transactions on Blend’s platform. Stabilizing mortgage revenue with continued Consumer Banking growth would show that activity is turning into revenue and growth is not resting on one suite. If mortgage transactions rise but Mortgage Suite revenue remains weak, customer churn, renewal pricing or changes in verification revenue may still be offsetting more activity, leaving Blend’s revenue base unsettled.
