Summary
Blend Labs reported total revenue of $31.5 million for the quarter ended June 30, 2025, up 9.9% from the prior-year quarter. That marked the fourth consecutive quarter of year-over-year revenue growth, according to the press release. GAAP gross profit was $23.3 million, up 14.6%, and GAAP gross margin was 73.9%, up 3.0 percentage points. The GAAP loss from operations was $4.6 million, an improvement of 64.6% from the prior-year quarter, and GAAP operating margin was -14.7%, up 30.9 percentage points. GAAP net loss attributable to Blend Labs was $6.6 million, up 65.8% (a narrower loss), and diluted loss per share was -$0.04, up 55.6% (a narrower loss). For the first six months of 2025, total revenue was $58.3 million, up 11.0% from the prior-year period, and gross profit was $42.3 million, up 16.2%.
Non-GAAP metrics showed a clearer turn. Non-GAAP gross margin was 76%, up from 71% in the prior-year quarter. Non-GAAP income from operations was $4.7 million, a 15% non-GAAP operating margin, compared with a non-GAAP loss from operations of $5.5 million in the prior-year quarter. That was the fourth consecutive quarter of non-GAAP operating profit. Operating cash flow was -$6.4 million for the quarter, up 4.5% from the prior-year quarter. For the first six months of 2025, operating cash flow was $14.0 million, up 233.1% from the prior-year period. Capital expenditures were $3.7 million for the quarter, up 101.6%. Free cash flow was -$9.0 million in the second quarter of 2025, compared with -$5.1 million in the second quarter of 2024.
Operational momentum centered on sales and remaining performance obligations. Remaining performance obligations ended the quarter at a record $190.4 million, up 117.8% from the prior-year quarter. The record RPO balance was fueled by the $50 million renewal and expansion announced in May. The company recorded 23 new or expanded deals in the second quarter, more than double the first-quarter deal count, including three independent mortgage banks as new customers. Blend also agreed to sell Title365 to Covius, a move that is expected to transition its title services to a higher-margin partnership model. The transaction is subject to third-party consents and regulatory approvals and is expected to close later in the fiscal year. Results for the former Title segment are now presented as discontinued operations.
Management provided third-quarter 2025 guidance for total revenue of $31.5 million to $33.5 million and non-GAAP net operating income of $3.0 million to $4.5 million. The guidance is for the third quarter, not the full fiscal year. Blend expects U.S. aggregate industry mortgage originations to be marginally higher in the third quarter of 2025 relative to the second quarter, with market size of 1,160,000 to 1,260,000 units. It expects a slight decrease between the third and fourth quarters, with fourth-quarter market size of 1,130,000 to 1,230,000 units. The company did not provide a forward-looking GAAP equivalent for its non-GAAP net operating income outlook because of uncertainty around stock-based compensation and potential non-recurring items. It also said economic conditions, real estate and mortgage activity, and the financial condition of some financial customers remain highly uncertain.
Risks remain material. Management cited uncertainty around economic conditions, mortgage interest rates, credit availability, real estate prices, tariffs, regulatory changes, inflation, and consumer confidence. Other named risks include customer retention and product utilization, competition, limited operating history, restructuring outcomes, the Haveli investment and its governance and dilution effects, the share repurchase program, and the title business exit. The company has no outstanding debt as of June 30, 2025, but it continues to operate in a challenging mortgage market and expects mortgage origination volumes to influence results. It also flagged that some financial customers could face financial condition issues. Blend noted that it has generated significant losses from operations and negative cash flows from operating activities in the past and may require additional capital to grow its business.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q2 FY2025 | Q1 FY2025 | QoQ | Q2 FY2024 | YoY |
|---|---|---|---|---|---|
| Revenue | $31.5M | $26.8M | +17.8% | $40.5M | -22.1% |
| Gross profit | $23.3M | $19.0M | +22.9% | $21.7M | +7.5% |
| Gross margin | 73.9% | 70.8% | +3.1 pp | 53.5% | +20.4 pp |
| Research & development | $7.3M | $7.5M | -2.5% | $12.9M | -43.2% |
| Sales & marketing | $7.0M | $7.2M | -3.3% | $9.4M | -25.8% |
| General & administrative | $13.6M | $11.2M | +21.3% | $12.5M | +8.7% |
| Total operating expenses | $27.9M | $26.7M | +4.8% | $35.0M | -20.2% |
| Operating income (loss) | -$4.6M | -$7.7M | +39.9% | -$13.3M | +65.3% |
| Operating margin | -14.7% | -28.7% | +14.1 pp | -33.0% | +18.3 pp |
| Net income (loss) | -$6.6M | -$9.4M | +29.4% | -$19.4M | +65.8% |
| Net margin | -21.1% | -35.2% | +14.1 pp | -48.0% | +26.9 pp |
Risks
Revenue depends heavily on mortgage and financial services transaction volumes, which remain sensitive to high interest rates, tariffs, and economic downturns. Mortgage Suite revenue decreased 3% for the three and six months ended June 30, 2025, and management expects Q3 2025 industry mortgage originations largely in line with Q2 2025.
A small number of customers drive significant revenue and transaction volume. For 2024, the top five Blend Platform customers accounted for 33.0% of segment revenue, and in the previously reported Title segment Mr. Cooper alone accounted for 46.8%, increasing exposure to customer loss or reduced utilization.
The pending sale of Title365, agreed on June 9, 2025 and expected to close later in fiscal 2025, is subject to third-party consents and regulatory approvals. Management stated it does not expect to recoup the full revenue loss from the sale in 2025, and pendency could disrupt operations, customers, and employees.
The company expects to rely on AI to help drive future growth but may not realize benefits if customers in regulated industries resist adoption or competitors incorporate AI more quickly. Evolving AI laws, including the EU AI Act and U.S. state legislation, could require significant changes to its AI use.
Sales cycles are lengthy, generally six to nine months for smaller financial services firms and twelve to eighteen months or more for larger firms, and macroeconomic conditions such as rising interest rates can further delay purchases. This creates greater costs and less revenue predictability.
The primarily success-based model relies on customer self-reporting of completed transactions, and the mix has shifted away from subscription arrangements toward prepaid multi-year usage-based arrangements. Inaccurate or late customer reporting could impair revenue estimation and forecasting.
As of June 30, 2025, accumulated deficit was $1,400.9 million and principal liquidity was $88.3 million in cash, cash equivalents, and marketable securities. The Series A Preferred Stock includes redemption rights and preferential liquidation rights that could reduce cash available for operations or limit additional financing.
The multi-class structure concentrates voting power with Nima Ghamsari, who represented approximately 34% of total voting power as of June 30, 2025 and could hold approximately 78% if all equity awards were exercised. Haveli also has Series A Preferred consent rights and a board designation right.
SaaS KPIs
All quarters →Free cash flow margin
Free cash flow
Non-GAAP operating margin
Summary, forecast, risks and KPIs are extracted from Blend Labs, Inc.'s SEC filings for Q2 FY2025 (10-Q / 10-K and the 8-K earnings release); GAAP figures in the summary are checked against the reported XBRL data. They can contain errors; the filings are authoritative. Processed Oct 2, 2026.