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loanDepot Grew Market Share To 3.5% In 3Q

David Krechevsky
Nov 01, 2021
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National mortgage lender posted results that included its ninth-consecutive quarter of year-over-year market growth and improved earnings from the second quarter.

KEY TAKEAWAYS
  • Reports quarterly total revenue of $923.8 million, diluted earnings per share of $0.40 and adjusted diluted earnings per share of $0.46.
  • Servicing portfolio increased to record $145 billion, representing over 469,000 homeowners, and resulted in quarterly servicing fee income of $102 million, increasing 112% year-over-year.

Citing in part its huge marketing partnership with Major League Baseball, the Foothill Ranch, Calif.-based company rebounded from a difficult second quarter, showing improvement in net income, gain of sale margin and market share.

For the quarter ended Sept. 30 the company reported total revenue of $923.8 million, or 40 cents per diluted share and 46 cents per adjusted diluted share, reflecting higher rate-lock volume and gain on sale margins,  it said.

Net income for the quarter increased to $154.3 million from $26.3 million in the second quarter, primarily driven by the increase in rate lock volume and gain on sale margins, and a decrease in personnel expense, the company said.  Year-over-year net income was still down significantly from $728.4 million in September 2020.

"The third quarter proved to be another strong milestone in market share growth, increasing to 3.5% from 2.4% during the same quarter last year," loanDepot Founder & CEO Anthony Hsieh said. "Our growing brand, proprietary mello tech stack, diversified channel strategy — which is the industry's only at-scale model of this type — and the hard work and enthusiasm of our talented employees delivered higher revenues, higher earnings, and higher earnings per share.”

Hsieh added that the results "demonstrate the agility and operational flexibility of our multi-channel strategy, which enables us to succeed in any market condition, including challenging ones." He called the thired-quarter results just "a preview of what is to come." 

loanDepot is coming up on just the six-month mark since issuing its IPO in February, and Hsieh said during an earnings webcast this morning that the company intends to go after the "other 97%" of the market.

He said loanDepot in the future intends "to continue to hire the best, leverage our brand, develop and apply innovative technology solutions, drive down costs and add more products and services to help our customers successfully navigate one of the most important financial transactions of their lives."

Loan origination volume for the third quarter fell to $31.99 million from $34.5 million in the second quarter but was up from $27.2 million a year earlier. Gain on sale margin rose in the quarter to 2.84%, up from 2.28% in the second quarter but still down from 4.87% in the third quarter of last year.

loanDepot said its servicing portfolio increased to a record $145 billion, representing over 469,000 homeowners, and resulted in quarterly servicing fee income of $102 million, a 112% year-over-year increase.

Hsieh cited the company’s partnership with Major League Baseball and a new national advertising campaign for helping to boost its third quarter results.

“We believe our market share increase is a direct result of our growing investments and increased marketing reach, as well as our technology that matches customers to the best loan officer for their needs across our multi-channel strategy,” he said

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