Better Home & Finance Holding Company

Good morning. My name is Aaron, and I'll be your conference operator for today. At this time, I would like to welcome everyone to the Better Home and Finance Holding Company first quarter 2026 results conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. And at that moment, if you would like to ask a question, simply press star followed by the number one on your telephone keypad. At any point, if you'd like to withdraw your question, simply hit star followed by the number one again. And with that, I'm pleased to turn the call over to Tarek Afifi, Senior Corporate Finance and Investor Relations Manager. Tarek, with that, you may begin.

Welcome to Better Home and Finance Holding Company's first quarter 2026 earnings conference call. My name is Tarek Afifi on Better's corporate finance team. Joining me on today's call are Vishal Garg, Founder and Chief Executive Officer of Better, and Levine Advani, Chief Financial Officer of Better. In addition to this conference call, please direct your attention to our first quarter earnings release, which is available on our investor relations website. Also available on our website is an investor presentation. Certain statements we make today may constitute forward-looking statements within the meaning of federal securities laws that are based on current expectations and assumptions. These expectations and assumptions are subject to risks, uncertainties, and other factors as discussed further in our IPC filings that could cause our actual results to differ materially from our historical results. We assume no responsibility to update forward-looking statements other than as required by law. During today's discussion, management will discuss certain non-GAAP financial measures which we believe are relevant in assessing the company's financial performance. These non-GAAP financial measures should not be considered replacements for and should be read together with our GAAP results. These non-GAAP financial measures are reconciled to GAAP financial measures in today's earnings release and investor presentation, both of which are available on the investor relations section of Better's website and when filed in our quarterly report on Form 10Q with the SEC. More information as of and for the period and in March 31st, 2026, will be provided upon filing our quarterly report on Form 10-Q of the SEC. I will now turn the call over to Vishal.

Thank you, Jara. Good morning, everyone. Q1 was a strong quarter for Better. We generated approximately $1.64 billion in funded loan volume, exceeding the high end of our prior guidance and growing funded loan volume approximately 89% year over year. Revenue from continuing operations grew approximately 52% year-over-year to $47.5 million. And our adjusted EBITDA loss was approximately $19 million, which was a 48% improvement year-over-year. Just as importantly, we continued scaling the Tin Man AI platform and expanding our partnership ecosystem, which remained the core drivers of our long-term strategy. Before discussing product innovation and partnerships, I want to address the macro environment directly and explain how we are thinking about the business in the current rate debt backdrop. The company entered 2026 with strong momentum, generating funded loan volume of $450 million, $521 million, and $673 million in January, February, and March, respectively. A month, over a month growth of 16% and 29% in February and March. What's more, in late April, Pre-approval volume for our biggest Tin Man AI platform partner went from approximately $100 million per day in pre-approved customer volume to over $200 million per day in pre-approved customer volume. That being said, the prolonged conflict in the Middle East has started to show a marked impact on interest rates across the mortgage industry, with rates for consumers on our platform growing from 5.75% to well over 6.5% in the last few weeks. And this is causing consumers to get stuck in the middle of the funnel, hesitating to lock at a higher rate, particularly if they feel the rate increase is temporary due to the situation in the Middle East. With our partner's help, we are converting some of these customers who need cash now to HELOCs. But for those looking just for savings for months, we are in a waiting pattern where we will go back to them with a lock as soon as rates come back down. So the bad news is that conversion rates are down from where they were in Q1 due to macro factors. The good news is that partner volume continues to increase dramatically as the partner opens up to a broader section of their customer base and products. Despite the macronoids, we are structurally better positioned than most mortgage platforms for three reasons. Our partnership model creates structurally lower customer acquisition costs and scalable distribution and doesn't require us to spend money up front, which then can get hung up when conversion cycles bloat during volatile market periods. Hinman AI continues to improve conversion efficiency and operating leverage. Our diversified product mix spans across purchase, refi, and HELOC. And when refis become more difficult, we can convert a segment of those into HELOCs, which is a tool we didn't have in prior rate cycles. As positioning reflected in our Q2 guidance, we expect funded loan volume of approximately $1.65 billion, representing approximately 37% year-over-year growth, slower than what we had originally anticipated going into Q2. Importantly, while funded loan volumes are expected to remain approximately flat sequentially, revenue is still expected to grow meaningfully due to continued makeshift towards higher-margin HELOC products. We currently expect approximately 15% sequential revenue growth in Q2, which we believe is an important signal that the strategy works and the platform works despite the macro backdrop. We also continue to believe the business is positioned for substantial operating leverage as volumes recover. At the same time, we want to be direct with investors. The timing on when we achieve our $1 billion monthly funded volume target will depend in part on the rate environment. It looked highly doable this time last month, and right now, sitting for this month, it looks like it's going to be deferred. The long-term trend remains intact, but near-term visibility continues to be impacted by macro volatility and what that does to consumer benefit on a refund. That said, if rates improve meaningfully, we believe the lead funnel is already in place and positions us to accelerate towards that target relatively quickly. Regardless of the environment, we continue to execute aggressively. In April, we announced a series of deliberate steps to strengthen operations and continue our progress towards profitability. These actions are on track and are even more important against the backdrop I just described. First, we're removing at least $25 million of annualized costs from our operations beginning in June 20, 2026. Second, we expanded our total warehouse capacity by 48% to $850 million since the start of Q1. And third, in early April, we raised $69 million in equity that further strengthened liquidity and operational flexibility. All of these actions, along with greater focus on AI efficiencies, deep cuts in corporate overhead, and the adjusted revenue growth, and the change in the mix to ELOX versus REFI, means we remain in sight of the target of adjusted even to operate even by the end of Q3 2026. Turning to partnerships, our Credit Karma Finance of America and top five non-bank originator partnerships are all live and rampant. These partnerships are especially important because they leverage existing customer ecosystems rather than paid acquisition channels. For example, an increasing portion of Credit Karma's 140 million members are exposed to Credit Karma home loans powered by Better. That's zero upfront cap to us. We believe that structural CAC advantage will become increasingly important as the industry consolidates. In late January, we marked the one-year anniversary of our partnership with NEO. NEO grew from a $1.5 billion run rate at onboarding to $2.9 billion in March 2026. Our 1099 platform generated approximately $821 million in funded loan volume during Q1, accounting for approximately 50% of total funded loan volume. up from 44% in Q4. That progression is important. Tin Man represented 0% of funded loan volume in 2024, approximately 36% in full year 2025, and now approximately half of total funded loan volume. We expect that percentage to continue increasing in the coming quarters ahead. Now to product innovation. We had two recent launches I want to highlight, both of which serve buyers in this environment. Last week, we announced the launch of the Better Home Equity Card in partnership with Stripe. The card is a master card linked to a better HELOC, letting customers spend funds drawn from their line with a single flight. Even more, customers get 1% cash back on all spend, which further lowers their total cost of financing and extends their stickiness in the better ecosystem from a one-time transaction to a 30-year relationship. We believe HELOC demand remains durable across rate environments, and this product materially simplifies homeowner access to instant long-term liquidity against the value of their home. In March, we also launched the first FAME-eligible token-backed mortgage in partnership with Coinbase. Qualified customers of Coinbase can pledge Bitcoin or USDC as collateral to fund their down payment without liquidating their holdings, triggering a taxable event. We have a large pipeline of Coinbase customers who are signed up on waitlists for the official commercial release of the product in Q2. We see digital assets increasingly becoming part of mainstream consumer finance infrastructure, and we intend for better to lead that transition inside mortgage origination, to leverage DeFi technology to fundamentally lower the interest rates on home finance products for our consumers. We believe the foundation is now in place for better across our tech platform. Our distribution partnerships, our product expansion, and our cost structure and the food points are becoming visible in revenue growth and path to profitability insight despite a choppy macro environment. With that, I'll turn it over to Levine.