Strategic Performance Drivers
Achieved a 112% year-over-year increase in adjusted net income, driven by operational enhancements that reached a strategic inflection point in late Q1.
Proprietary reverse mortgage products are serving as the primary growth engine, expanding the addressable market to borrowers aged 55+ and those seeking second-lien solutions.
The ‘Helix’ proprietary platform and ‘Joy’ AI layer are driving top-of-funnel efficiency, resulting in an 84% increase in inquiry volume in March versus the 2025 average while reducing cost per inquiry by 19%.
Market leadership in proprietary products is mitigating the impact of flat industry-wide government-insured (HECM) volumes by capturing jumbo balances and bespoke borrower needs.
Strategic focus on the $14.6 trillion in senior home equity highlights a massive underpenetration, with current industry volumes representing less than 1% of the total addressable market.
Operational improvements led to record retail productivity, with submissions per loan officer in March reaching the highest level in the company’s history.
Outlook and Strategic Priorities
Increased full-year 2026 adjusted EPS guidance to $4.50–$5.00, reflecting strong Q1 momentum and improved revenue margins from proprietary production.
Maintained funded volume guidance of $2.8 billion to $3.1 billion, supported by a 20% year-over-year increase in Q1 submissions as a leading indicator.
Prioritizing the retirement of $150 million in senior secured corporate notes later this year to establish a deleveraged foundation before revisiting other capital allocation priorities.
The PHH transaction has been bifurcated into two phases, with the origination and subservicing components expected to close in May 2026.
Anticipate continued compounding benefits from AI integration, specifically in matching customers with optimal products and further optimizing marketing spend.
Structural and Risk Factors
Modified the PHH transaction structure to close in two phases due to pending Ginnie Mae approval for the HECM servicing rights portion.
Utilized $40 million in cash during the quarter to complete the strategic repurchase of Blackstone’s equity position.
Tangible equity increased to approximately $15 per share, which management believes warrants a higher valuation multiple as earnings power is demonstrated.
Noted that while HECM volumes remain sensitive to interest rates, proprietary second-lien products offer a hedge for borrowers wishing to retain low-rate primary mortgages.
Q&A Session Summary
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