Quick Read
Blend Labs (BLND) fell 46% to $1.65 as Consumer Banking Suite revenue grew 34% to $12.7M and Mortgage Suite revenue dropped 18% to $17.7M, while delivering $4.62M in operating income at a 14% margin. Blend Labs is embedding AI in loan origination to reduce $11,000 mortgage costs while Consumer Banking accelerates and mortgage servicers seek AI integration.
Blend Labs CEO Nima Ghamsari said something that does not come up often on earnings calls: “I have never been more excited about our business.” That is a bold statement for a company whose stock has fallen roughly 46% over the past year. So what is he actually seeing?
The Tale of Two Businesses
Ghamsari was direct about the split inside Blend Labs (NYSE:BLND): “It reflects a tale of two dynamics. We saw continued strength and growth in our Consumer Banking Suite, which was offset by some headwinds to revenue in our mortgage business.”
The numbers back that up. In Q3 2025, Consumer Banking Suite revenue grew 34% year-over-year to $12.7 million, while Mortgage Suite revenue fell 18% to $17.7 million. Consumer Banking now represents 39% of total revenue, up from 29% a year ago. The mix shift is real and accelerating.
The $11,000 Problem and the AI Bet
The cost to originate a mortgage loan is still stubbornly high, nearly $11,000, and roughly 90% of that is human labor. The industry is realizing that bolting on more point solutions only adds complexity and costs.
— Nima Ghamsari, Q3 2025 Earnings Call
His answer is what he calls Blend Intelligent Origination, an AI layer embedded directly into the platform’s existing workflow. “This isn’t another tool. It’s an entirely new operating model for lending.” Critically, he noted this is not yet in the financial model: “I see it as a significant growth opportunity beyond what we shared during our last Investor Day.”
Pipeline and Deal Quality
Ghamsari distinguished volume from value on the deal front. “In the third quarter, we signed 14 new deals and expansions. But the quality of these deals is what’s most important.” The headline deal was a seven-figure expansion with a top 20 U.S. bank for solar home equity lending. The sales pipeline itself is up approximately 60% year-over-year.
He also addressed the Rocket-Cooper dynamic directly, noting that large mortgage servicers are rethinking strategies and reaching out about AI integration: “They want to use this time, when some companies may be occupied with other priorities, to enhance their operations significantly.”
Profitability Is Not an Accident
Blend posted non-GAAP operating income of $4.62 million, a 14% margin, marking five consecutive quarters of non-GAAP operating profitability. Ghamsari’s framing: “This five-quarter streak of profitability is not an accident. It’s a direct result of their focus, their discipline, and their deep commitment to our customer success.”
The stock sits at $1.65 versus $3.04 at the start of 2026. Whether Consumer Banking growth, AI origination adoption, and a potential mortgage volume recovery can close that gap remains to be seen. Ghamsari’s commentary suggests he believes the business is positioned for that scenario.
