Better Home & Finance (BETR) Q1 2025 earnings summary

Executive summary

• Achieved 31% year-over-year growth in funded loan volume to $868 million and revenue growth of up to 50% to $33 million in Q1 2025, driven by AI-powered platforms, DTC, and Tin Man AI channels.

• Net loss was $50.6 million, remaining flat year-over-year, with improvements from Q4 2024; adjusted EBITDA loss was $40.4 million.

• Retired $530M–$532.5M in convertible debt, creating $200 million in pre-tax equity value and improving the capital structure.

• Strategic focus on AI-driven growth, operational efficiency, and diversification of distribution channels, including onboarding banks and fintechs to Tin Man AI.

• Neo powered by Better exceeded expectations, onboarding 115 loan officers and generating $163 million in funded loan volume in Q1 2025.

Financial highlights

• Q1 2025 revenue grew 46% year-over-year to $33 million; funded loan volume up 31% to $868 million.

• Adjusted EBITDA loss was $40.4 million; GAAP net loss was $50.6 million.

• Revenue rose 30% sequentially from Q4 2024 despite a 7% decline in funded loan volume, outperforming guidance.

• Gain on loans, net, increased 57% to $24.6 million; other revenue grew 43% to $4.0 million.

• Loan origination and total expenses (excluding one-time SPAC costs) decreased 11% sequentially, but total expenses rose 13% year-over-year to $83.0 million.

Outlook and guidance

• Q2 2025 funded loan volume expected to increase over Q1, with Neo originations projected to exceed $450 million (250%+ growth vs. Q1).

• Full-year 2025 funded loan volume growth anticipated, offset by macro headwinds and loss of Ally business (~$1B headwind).

• Adjusted EBITDA losses expected to improve in 2025 due to efficiency gains and cost reductions.

• U.K. bank originations expected to more than double in 2025 as AI is deployed; exit of non-core U.K. assets to benefit adjusted EBITDA in H2 2025.

• Liquidity expected to be sufficient for at least 12 months, supported by warehouse lines and customer deposits.