Blend Reports Strong Third Quarter 2025 Performance with Higher Operating Profitability and Expanding Customer Momentum
Blend Labs, Inc. (NYSE: BLND), a leading provider of cloud-based digital banking and lending solutions, announced its financial results for the third quarter of 2025, highlighting meaningful operational progress, continued momentum in customer expansion, and improved profitability. The company, known widely for simplifying consumer banking experiences across mortgages, personal loans, deposit account openings, and related financial products, showcased results that exceeded internal expectations and demonstrated resilience amid a gradually improving housing finance environment.
Performance Highlights Reflect Continued Operational Discipline and Market Demand
During the third quarter of 2025, Blend recorded total revenue of $32.9 million, representing a slight 1% decrease compared to the same period in 2024. While overall revenue was relatively stable, the composition of revenue reflected the shifting nature of customer demand:
- Software platform revenue totaled $30.5 million, declining 2% year-over-year, consistent with the broader mortgage market’s ongoing recovery cycle.
- Professional services revenue increased 18% year-over-year to $2.4 million, driven by expanded implementations and deeper collaboration with financial institutions deploying Blend’s platform.
Despite mixed revenue movements, Blend posted significant improvements in profitability. The company reported a GAAP gross profit margin of 74%, unchanged from the third quarter of 2024, while non-GAAP gross margin rose to 78%, compared to 75% in the same period last year. This expansion in margin reflects Blend’s ongoing focus on cost efficiency, platform scalability, and operational alignment following prior restructuring actions.
Most notably, Blend reported a GAAP operating loss of $4.9 million, representing a substantial improvement from a $11.3 million loss in the third quarter of 2024. On a non-GAAP basis, Blend generated operating income of $4.6 million, compared to just $0.3 million one year earlier. This shift into positive non-GAAP operating income marks a meaningful milestone for the company and underscores management’s ongoing commitment to sustainable growth.
Diluted earnings per share also improved. GAAP diluted net income per share attributable to common stockholders was $0.02, compared to a loss of $0.02 per share in the prior-year quarter. On a non-GAAP basis, diluted earnings per share broke even at $0.00, compared to a loss of $0.01 per share last year.
Growing Customer Adoption and Renewed Market Activity Drive Momentum
Blend’s customer traction continued to strengthen. During the quarter, the company added or expanded 14 customer relationships, marking one of the strongest quarters of customer engagement in the past several years. The company also reported that its sales pipeline grew approximately 60% year-over-year, an indicator of rising market demand and improving client confidence in the lending environment.
One of the highlights of the quarter included a seven-figure expansion with one of the nation’s top 20 banks, demonstrating Blend’s ability to scale within large enterprise financial institutions. Additionally, Blend secured a major renewal and expansion with a long-standing consumer banking customer, spanning six different product lines, reinforcing the company’s strategy of deep multi-product integration.
Reflecting on the quarter’s achievements, Nima Ghamsari, Co-Founder and Head of Blend, stated:
In the third quarter, we signed 14 new deals and expansions including a seven-figure expansion with a top 20 bank and a major renewal and expansion with a consumer banking customer across six product lines. When I look at the macro environment finally showing signs of life—particularly the potential for lower rates—and combine it with the specific momentum we are generating ourselves, I have never been more excited about our business.
Ghamsari noted that although the mortgage market has been challenged in recent years by higher interest rates and affordability pressures, the environment is now showing signs of stabilization. This shift, combined with Blend’s consistent customer engagement, positions the company for improved performance in upcoming quarters.
Fourth Quarter 2025 Guidance Reflects Stable Trends and Seasonal Considerations
For the fourth quarter of 2025, Blend provided the following financial outlook:
| Metric | Q4 2025 Guidance |
|---|---|
| Total Revenue | $31.0M – $32.5M |
| Non-GAAP Net Operating Income | $2.5M – $3.5M |
This guidance reflects continued discipline in cost management and an expectation of stable industry mortgage origination volume. Blend noted that its outlook is tied to its projection of U.S. mortgage market activity, which is monitored through Home Mortgage Disclosure Act (HMDA) data. The company expects the total mortgage market size in Q4 2025 to range between 1.13 million and 1.23 million units, and anticipates a modest seasonal decline in the first quarter of 2026, consistent with historical patterns.
Blend acknowledged that broader economic conditions—including interest rate volatility, real estate market dynamics, and financial stability of customer institutions—continue to present uncertainties. However, the company emphasized that its ongoing operational improvements and diversified product offerings place it in a strong competitive position.
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