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    BETR
    Earnings call· Jun 2026(Q2 FY26)

    Better Home & Finance Holding Q2 FY26 earnings call BETR

    Aug 6, 2026 Source

    Executive summary

    Better Home & Finance Q2 FY26 — Leadership Transition Amidst Macro Headwinds and Strategic Re-focus

    Better Home & Finance is undergoing a leadership transition with a new interim CEO focused on strategic execution and operational efficiency. The company reported strong Q2 growth and significant cost reductions, but faces macro headwinds and partnership launch delays, leading to a revised Q3 outlook and a missed adjusted EBITDA break-even target. The strategy emphasizes disciplined capital allocation, aggressive investment in HELOC, and leveraging the Tin Man AI platform for enterprise partners and wholesale channels, rather than relying on market improvement.

    Highlights

    5

    • Loan volume grew 38% year-over-year to $1.67 billion in Q2 FY26.

    • Total net revenues increased 28% year-over-year and 15% quarter-over-quarter to $54.7 million.

    • Adjusted EBITDA loss improved 39% year-over-year and 26% quarter-over-quarter to $14 million.

    • Annual cost savings are expected to exceed $45 million, surpassing the original target of $25 million.

    • Warehouse capacity increased 48% from year-end 2025 to approximately $850 million.

    Concerns

    5

    • Q3 FY26 loan volume guidance of $1.375 billion to $1.525 billion implies a sequential decline.

    • Q3 FY26 total net revenues guidance of $49 million to $52 million implies a sequential decline.

    • Adjusted EBITDA break-even target for September was missed, with Q3 FY26 adjusted EBITDA loss guided to $15 million to $18 million.

    • Uncertain timing of several partnership launches impacts near-term revenue predictability.

    • The rate backdrop became more difficult, and an elevated rate environment is expected to persist over the medium term.

    Guidance & targets

    5
    CategoryTargetConfidence
    Q3 FY26 Loan Volume
    $1.375 billion to $1.525 billion
    high materiality
    Medium
    Q3 FY26 Total Net Revenues
    $49 million to $52 million
    high materiality
    Medium
    Q3 FY26 Adjusted EBITDA Loss
    $15 million to $18 million
    high materiality
    Medium
    Adjusted EBITDA Break-even
    Will fall short of September target
    high materiality
    Low
    Annual Cost Savings
    Exceed $45 million
    medium materiality
    High

    Segment performance

    7
    SegmentRevenueYoYQoQMargin
    Company-wide
    Total net revenues increased year-over-year and quarter-over-quarter.
    		$54.7 million28%15%—
    Refinance Loan Volume
    Significant year-over-year growth in refinance loan volume, contributing a third of total loan volume.
    Loan Volume: $549 millionShare of Q2 Loan Volume: 33%
    		—239%——
    Home Equity Loan Volume
    Solid year-over-year growth in home equity volume, increasing its share of total loan volume.
    Loan Volume: $294 millionShare of Q2 Loan Volume: 18%
    		—23%——
    Purchase Loan Volume
    Modest year-over-year growth in purchase loan volume, representing the largest share of total loan volume.
    Loan Volume: $824 millionShare of Q2 Loan Volume: 49%
    		—3%——
    Tin Man AI Platform
    Over half of the loan volume originated through the Tin Man AI platform.
    Share of Q2 Loan Volume: 55%
    		————
    Direct-to-Consumer (D2C)
    Direct-to-consumer channel contributed a significant portion of loan volume.
    Share of Q2 Loan Volume: 45%
    		————
    NIO Business
    NIO business showed strong year-over-year loan volume growth and continues to recruit top loan officer teams.
    Loan Volume Growth: 60% YoY
    		—60%——

    Operational metrics

    12
    Adjusted EBITDA Loss
    $14 million39% improvement YoY, 26% improvement QoQ
    Q2 FY26

    Adjusted EBITDA loss showed significant improvement, aided by a one-time reserve release.

    Cash and Cash Equivalents
    $102 million
    Q2 FY26 end

    Company's cash position at the end of the quarter.

    Restricted Cash
    $10 million
    Q2 FY26 end

    Restricted cash balance at quarter end.

    Warehouse Capacity
    $850 million48% increase from year-end 2025
    Q2 FY26 end

    Reflects confidence from warehouse lenders and infrastructure for future growth.

    Annual Cost Savings
    $45 millionwell above original target of $25 million
    Annual

    Expected cost savings from ongoing initiatives.

    Total Loan Volume
    $1.67 billion38% YoY growth
    Q2 FY26

    Overall loan volume for the quarter.

    HELOC Share of Loan Volume
    18%up from 12% last quarter
    Q2 FY26

    HELOCs are a direct reflection of the company's response to the elevated rate backdrop.

    OPEX (adjusted)
    $75 million
    Q2 FY26

    Operating expenses for the quarter, adjusted for a one-time item.

    OPEX (midpoint)
    $67 millionapprox. $8 million savings QoQ
    Q3 FY26

    Projected operating expenses for the next quarter, reflecting cost reduction impacts.

    Pricing Methodology
    20% to 25%
    Ongoing

    The company's strategy to price for contribution margin rather than just loan volume.

    CEO Compensation Structure
    —
    Ongoing

    Interim CEO Daniel Lewis requested this structure to align incentives with shareholders, with final terms to be disclosed in public filings.

    Board Compensation Structure
    —
    Ongoing

    Board members have elected to receive their compensation in equity to align with shareholder interests.

    Product announcements

    2
    ProductTypeDetails
    Tin Man for Wholesale Channellaunch
    HELOC as Enterprise Productroadmap

    Deals & partnerships

    1
    Birmingham BankSale of UK bank subsidiary

    The company continues to pursue the sale of its UK bank subsidiary, Birmingham Bank, through a process led by FT Partners. An update will be provided upon material development.

    Risks & headwinds

    5
    Muted Refinancing EnvironmentQ3 FY26 and medium term

    Q3 guidance reflects muted refinancing environment

    Mitigation: Focus on HELOC products and enterprise partnerships; building operating leverage in businesses where demand already exists.

    Uncertain Timing of Partnership LaunchesQ3 FY26

    Q3 guidance reflects uncertain timing of several partnership launches

    Mitigation: Focus on building an organization that consistently implements, supports, and grows partnerships; prioritizing API-driven integrations over complicated ones.

    Failure to Meet Adjusted EBITDA Break-even TargetSeptember FY26

    Previously guided goal of reaching adjusted EBITDA break-even by September, we now expect to fall short.

    Mitigation: Continued cost reductions; focus on sustainable profitability without sacrificing opportunity; not anchoring to a specific month for break-even.

    Elevated Rate EnvironmentMedium term

    Rate backdrop got more difficult as the quarter progressed; planning for an elevated rate environment to persist over the medium term.

    Mitigation: Adapting by emphasizing HELOC products, which enable homeowners to access liquidity without giving up lower rates.

    Complexity Slowing ExecutionOngoing

    An organization moving into an enterprise strategy needs focus as complexity slows execution.

    Mitigation: Concentrating on fewer priorities and executing them exceptionally well; simplifying operations by combining NEO and Better Mortgage operations.

    What to watch in Q3 FY26

    5

    HELOC Partnership Launches

    Q4 FY26
    CurrentNo HELOC partnerships launched in Q3 FY26
    TargetMultiple partnerships to kick in

    Why it matters

    Successful HELOC partnership launches are crucial for diversifying revenue streams and reducing reliance on the volatile refinance market, directly impacting future revenue growth and profitability.

    So far this quarter, we have done no partner launches and no HELOC launches specifically. So hopefully💬 that gives you a sense of why the bridge on revenue. We are basically still have the refi environment in our largest enterprise segment. and we don't have anything really additional in terms of channel development in the HELOC product.

    Q&A highlights

    6

    How much of the cost initiative improvement is already visible in Q3 guidance versus future realization, given lower sequential loan volume and revenue but better EBITDA?

    Levine explained that Q2 OPEX was around $75 million (adjusted for a one-time trade reserve release), and the Q3 midpoint implies OPEX of about $67 million, showing approximately $8 million in savings. Most cost cuts were implemented late in Q2, so their full impact will be seen in Q3, leading to improved EBITDA despite lower volumes.

    “Yes, so in our Q2, if you adjust for the trade, our OPEX was around 75 million and The midpoint of our Q3 guidance has OPEX about 67 million. So say about 8 million of savings from quarter over quarter.”

    asked by Kartik Mehta · answered by Unknown Speaker

    2 min read6 chapters

    Detailed Narrative

    01

    Leadership Transition and Strategic Re-focus

    Daniel Lewis was appointed interim CEO, having worked with management for three months prior. His mandate is to strengthen execution and improve operational efficiency, focusing on fewer priorities. The board is running a search for a permanent CEO, but Lewis has full authority to execute the current strategic plan. The transition reflects a shift from a founder-led, creativity-driven model to an enterprise stage focused on executing against select ideas with demonstrated product-market fit.

    02

    Macro Environment and Adaptation

    The rate backdrop became more challenging in Q2, leading to softened industry-wide mortgage application activity. Management plans for an elevated rate environment to persist over the medium term⏳ and is adapting by emphasizing HELOC products. HELOCs represented 18% of Q2 loan volume, up from 12% in Q1, as they enable homeowners to access liquidity without giving up lower locked-in rates.

    03

    Strategic Priorities: Distribution and Partnerships

    The company's first priority is distribution, focusing on enterprise partners whose businesses align with Tin Man and its API-driven operating model. This includes consumer platforms like Credit Karma and Coinbase, NEO operations, wholesale brokers, and other enterprise partners. The goal is to manufacture mortgages efficiently without outspending competitors on customer acquisition, moving away from complicated enterprise integrations that have not yielded material results.

    04

    Strategic Priorities: Product and Tin Man

    The second priority is aggressive investment in HELOC, which combines sophisticated underwriting with a differentiated experience. The wholesale market's interest in HELOC has exceeded expectations. The third priority is Tin Man, an AI-native, modular, end-to-end solution for the mortgage process. It is built by loan officers, leveraging D2C and NEO as innovation platforms and feedback loops to drive automation and improve the loan officer experience.

    05

    Cost Reduction and Path to Profitability

    Better expects annual cost savings to exceed $45 million, well above the original target of $25 million. These cost reductions are expected to flow through the P&L over the remainder of the year. Despite lower Q3 volumes and revenue, cost savings are projected to lead to improved EBITDA. The company aims for sustainable profitability through disciplined capital allocation and consistent execution, rather than waiting for market improvement.

    06

    Financial Position and Warehouse Capacity

    The company ended Q2 FY26 with approximately $102 million in cash and cash equivalents and $10 million in restricted cash, believing its balance sheet is appropriately positioned for profitability. Total warehouse capacity stands at approximately $850 million, a 48% increase from year-end 2025, reflecting lender confidence in the platform and infrastructure for future partnership growth.

    AI-generated summary of the company’s earnings call. Not investment advice.