Beeline Holdings Inc (BLNE) 2025 Q4 法說會逐字稿

Good day and welcome to the Beeline fourth-quarter 2025 financial results conference call. (Operator Instructions) Please note this event is being recorded.

I would now like to turn the conference over to Tiffany Milton, Chief Accounting Officer. Please go ahead, ma’am.

Thank you. Good evening, everyone, and thank you for joining us today to discuss Beeline's financial results for the fourth quarter of 2025. I'm Tiffany Milton, Beeline's Chief Accounting Officer, and joining us on today's call to discuss these results is Nick Laiuza, our Chief Executive Officer; Jess Kennedy, Chief Operating Officer; and Chris Moe, our Chief Financial Officer. Following our remarks, we will open the call to your. Questions.

Now, before we begin with prepared remarks, we submit for the record the following statement. This conference call contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, but not limited to, statements regarding Beeline Holdings' expected future growth of its core business, increased revenue, growth of fee-based revenue streams, including Beeline equity, and expansion of our SaaS and AI capabilities, and expansion of our warehouse lines.

Forward-looking statements are typically identified by words such as believe, expect, anticipate, plan, intend, seek, estimate, will, would, could, may, continue, forecast, target, potential, project, undertake, and similar expressions. These statements are based on management's current assumptions, beliefs, and expectations, and are not guarantees of future performance. Actual results may differ materially from those described in forward-looking statements due to various risks and uncertainties. These include, without limitation, the risk factors we provided in our 2025 Form 10-K we are filing tomorrow and prospective state supplements we have filed with the SEC.

We caution investors not to place undue reliance on any forward-looking statements made during this call. All forward-looking statements speak only as of the date of this presentation and are based on information available to Beeline as of today. We undertake no obligation to publicly update or revise these statements to reflect events or circumstances occurring after today's date, except as required by law.

Now, with that being said, I'd like to turn the call over to Nick Liuzza. Nick, please proceed.

Good afternoon, everyone. And thank you for joining us today. 2025 was a transformational year for Beeline. We simplified our balance sheet, grew the core mortgage business, and began to demonstrate operating leverage in the model. We also introduced new capabilities across the platform, including version one of our self-service mortgage experience, designed to streamline and simplify the borrower journey.

As we enter 2026, our focus is on building on that progress, disciplined execution, continued growth in the core business, and the expansion of new revenue streams positioning Beeline to accelerate its revenue growth with stronger loan-level economics. Some of the 2025 highlights include: we became a public company, strengthening the balance sheet through equity capital raises and the elimination of debt. We increased year-over-year revenues by 127%.

We delivered strong growth in our core mortgage business with improvements across originations, revenue per loan, and conversion efficiency. We began to see operating leverage in the model as revenue growth outpaced growth in fixed costs. We laid the groundwork for additional capital-light fee-based revenue opportunities.

We executed through challenging market conditions while navigating increased expenses as a new public company. Today, we've established Beeline as a digital-first real estate finance platform with a diversified mix of mortgage products and an increasing mix of fee-based revenue streams. Let me frame how we think about the business going forward.

Our core focus remains on serving borrowers that are often underserved by traditional lenders, including self-employed individuals, younger borrowers, and real estate investors. This is a large and persistent segment of the market, and we've built our platform specifically around their unique needs with a fully digital experience and integrated title capabilities.

At the same time, we're beginning to expand beyond traditional mortgage lending, adding a more capital-light transaction-based revenue stream to our existing suite of mortgage products. An exciting development this year in that regard is the encouraging early progress of our Beeline Equity platform and our partnership with TYTL Holdings.

We appear to be ahead of the market with a unique equity product that is not tied to interest rates, infusing much-needed liquidity into the market with little to no direct competition. BRM equity is not just a new product, it's a new transaction layer for residential real estate.

Beeline Equity allows homeowners to access a portion of their home equity without refinancing or taking on additional debt while creating a new investable asset class. For Beeline, this is a fee-based model where we provide the infrastructure around the transaction. Beeline Equity is a pure equity play, unlike many of the HEI products on the market.

Importantly, our model is capital-light and fee-driven. Beeline primarily provides the infrastructure, customer acquisition, property analysis, the operational platform, title, settlement, and compliance. We earn 3.5% per transaction without assuming any principal risk. We also earn title revenue.

We began closing initial transactions with TYPL as our partner in the fourth quarter and are building a growing pipeline heading into 2026. We monetize transactions, not interest rate spreads, which fundamentally changes the economics of our business. Our model scales with transaction volume, not balance sheet capital. Our focus is on measured scaling and validating the unit economics as the product develops.

We believe this is a structurally different and more scalable business model than traditional mortgage lending. To frame the opportunity, there's nearly $40 trillion of home equity in the US that is effectively illiquid. Beeline equity is designed to unlock that liquidity in select ZIP codes, and we see significant opportunity over time, particularly given the limited number of solutions available to access it without recording a debt instrument.

As the market develops, we believe Beeline is uniquely positioned as a first mover with a fully integrated platform. The expected initial use case for Beeline Equity is to enable homeowners, including many older borrowers who have built meaningful equity in their homes to access liquidity without taking on additional debt or selling their asset.

More broadly, we are building a product set that addresses different borrower needs over time, from acquisition and investment financing to home equity access. In general, the primary use case for the Beeline Equity product is retirees who are asset-rich with cash poor and are reluctant to sell their properties.

Beeline now has products across the demographic spectrum, a wider variety of loans for younger borrowers, equity products for older homeowners who need or want to tap into some of that accumulated wealth. At the same time, our core business continues to improve.

I'd like to turn the call over to Jess Kennedy, our COO and Co-Founder, to discuss our core business and the significant improvements we've driven in our KPIs over the last few months. Jess?

Thanks, Nick. I'm pleased to join today's call. As Nick mentioned, we're excited about the opportunities ahead with Beeline Equity. At the same time, we remain focused on methodically strengthening our core mortgage business. Let me highlight a few key metrics that underscore our progress. We delivered strong growth across our core operating metrics. Mortgage originations increased to $84.7 million, up 44% from $59 million in the fourth quarter of last year.

The average revenue per loan increased 31%, and the average cost per loan decreased 18% quarter-over-quarter. This trend continued into January 2026, and we expect continued improvement in loan-level economics as we move through the year. In addition to the top-line momentum, there are meaningful improvements in our operational efficiency across the platform.

Lead to application time was cut by more than half from 1.1 days in 2024 to half a day. We are reaching our customers more quickly through better workflows and Bob, our proprietary AI agent. Cycle time from processing to clear to close also improved from an average of 22 days in 2024 to 18 days in 2025 on larger unit volumes.

Lock-to-close conversions increased from 46% to 55.1%, a 20% improvement from 2024 to 2025. These operational gains reflect the strength of our digital-first AI-driven platform, which continues to streamline the customer experience while driving faster cycle times and higher conversions.

Importantly, we are increasing both volume and revenue per loan with modest increase in headcount, which is translating into operational leverage. Looking ahead to 2026, our priorities are clear. Continue growing our core mortgage business with a strong focus on efficiency and revenue per loan. Scale Beeline Equity in a disciplined manner while maintaining a prudent risk posture. Expand our SaaS and AI capabilities.

Drive revenue growth across both volume and margin, and progress toward positive operating cash flow. Our objective is straightforward: to strengthen Beeline's financial profile while building a scalable platform capable of delivering sustainable, long-term, high-margin growth and providing an exceptional customer experience.

With that, I’ll turn it over to Chris Moe, our CFO, to walk through the financials.

Thanks, Jess. Starting with the fourth quarter, total net revenues were $2.5 million, an increase of 127% compared to $1.1 million in the fourth quarter of 2024. Sequentially, the fourth quarter increased by 8.3%. Gains on loan sales and loan origination fees. Increased both sequentially and year-over-year as we continue to scale the platform. Title fees were up 91% year-over-year and effectively flat sequentially as this business continues to generate stable and predictable revenue streams. We invested considerable resources to support our growth. Compensation, commissions and benefits increased by $5.2 million.

The majority of the compensation expenses were non-cash, stock-based compensation expense of $2.9 million. General and administrative expenses were up $2.4 million, primarily related to non-cash stock-based compensation expense of $1.4 million.

As a result, our loss from operations was $8 million compared to $4.1 million in the fourth quarter last year and $2.9 million in the third quarter of 2025. Again, fully half of the loss from operations was non-cash stock-based compensation and total non-cash items.

Comprised approximately $5 million of the $8 million operating loss. Adjusted EBITDA was a negative $3.4 million in the quarter, compared to a negative $3.2 million in the fourth quarter last year and negative $2 million in the third quarter of 2025.

Let me now shift to the full-year results. And since 2024 reflects the sub-period October 8 to December 31, 2024, I will only address full-year 2025.

Total revenue to $7.8 million, comprised of gains on loan sales of $5.4 million, loan origination fees of $1 million, and title fees of $1.4 million. These results reflect strong growth across our core businesses and continued momentum exiting the Year.

Total operating expenses were $27.3 million with almost 30% related to non-cash expenses. Net loss was $31.5 million and full year adjusted EBITDA was negative $11.8 million. From a cost perspective, we maintain discipline while continuing to invest in growth. Importantly, we are beginning to see operating leverage as revenue scales faster than fixed costs.

Turning to the balance sheet and comparing 12/31/2025 with 12/31/2024, we ended the year with cash balances higher by more than $2 million compared to 2024, supported by equity raises and approved capital structure. We significantly reduced debt during the year, and today, the company is debt-free outside of our warehouse lines, which are directly tied to loan production. Speaking of warehouse lines, we quintupled our warehouse capacity over the course of 2025.

Based on our current growth rates, we expect to increase our warehouse lines this summer to support continued origination growth. Accounts payable and working capital metrics improved meaningfully, reflecting tighter operational execution. AP was reduced by over $1 million and working capital improved by $9.2 million. Total equity increased by $4.6 million. Year-over-year, driven by capital raises and restructuring. Turning to cash flow, for the full year, cash used in operations was $21.4 million, as expected for a company in its scaling phase. Shifting to 2026, the heavy lifting in our platform is now complete, but we are focused on variable spending to support growth. As a result, we expect our cash burn to decrease in the first quarter of 2026.

We continue to prudently utilize our ATM facility and believe we have sufficient resources to fund our near-term growth plans. Investing cash flow of $1.1 million reflects continued investment in technology and platform development. Financing cash flow was $24.9 million, supporting both growth and balance sheet strengthening. To summarize, we delivered strong revenue growth, we improved operating efficiency.

We materially strengthened the balance sheet, and we're entering 2026 with improving cash flow dynamics. As we scale revenue, particularly from higher-margin capital-light initiatives like Beeline Equity, we expect continued improvement in both profitability and cash flow. With that, I'll turn it back to Nick.

Before we begin the Q&A session, I'd like to make brief points. First, we've built a platform that combines mortgage origination, title, AI, and fractional equity that allows us to serve a segment of the market that is underserved by traditional mortgage lenders. Second, we are adding a more capital-light, fee-based revenue stream, which we believe can improve both scalability and returns over time.

And third, we are increasingly focused on parts of the market where we believe we can build a more unique and durable position, supported by our integrated platform and capital-light model. Our priorities are clear: grow the business, scale new revenue streams in a disciplined way, and continue improving cash flow. If we continue to execute on these priorities, we believe the financial profile of the company will continue to strengthen. Thank you for your time and your continued interest in Beeline.

I'd now like to turn the call back over to the operator for Q&A.

Thank you. We will now begin the question-and-answer session. (Operator Instructions)

Michael Legge with Ladenburg.

Thanks. Good afternoon. Congrats on the quarter.

Wanted to kind of talk about, you mentioned $100 million run rate over the next couple of years. Can you talk about whether that's with the current three business lines of digital mortgage origination, AI and the equity ownership pieces or GSC adding any more legs to the stool?

Hey, Michael, it's Nick. Thank you for that. Yes, I see us focusing on the transactions that we discussed on the mortgage origination side and on the Beeline Equity side. There's tremendous opportunity. There's tremendous TAM.

We are an early adopter of the blockchain and the Beeline Equity piece. And so I see that revenue coming from the two channels of Beeline Origination primarily and Beeline Equity.

And then you mentioned obviously fee-based, volume-based business, but interest rate obviously is correlated with the real estate market. If rates come down, could you just kind of talk about what type of environment you might see for your products?

Chris, you want to take that?

Yeah, so I think the question is how exposed are we interest rates? Is that fair to say, Michael?

Yeah, or industry fee-based volume, et cetera.

Yeah. So obviously, our core mortgage business is still influenced by rates, which had, by the way, picked up in the last 30 days or so ever since the war started.

But two things I think are worth stressing that are changing with Beeline. First, we're improving our efficiency, particularly in the sales funnel. Like each step of the sales funnel, if you tighten it up like 2%, 3%, 4%, 5%, the time you get to the bottom of it could be like 20% better. So the ratio of our ad spend to our revenues is one of the things we look at heavily.

And then also revenue per loan, which as Jeff said earlier, has been growing. It used to be sort of in the low 2s, meaning $220,000, and now it's sort of averaging around $300,000, and that helps offset volume variability. But second, as Nick alluded to earlier, and more importantly, we've expanded into transaction-based fee-driven revenue streams, which are less dependent on rates or are frankly, I think in the case of Beeline equity, independent of rates.

So overall, overtime time, that should reduce our sensitivity to interest rate increases.

Yeah, and let me add something too as well, if you don't mind. Look, when you think about the $100 million run rate, it's about 700 transactions per month, give or take, along with our title business. And so when you think about that and you think about how big the addressable market is for B-Line equity, a $39 trillion market opportunity with not much competition and creating liquidity for a class of people that need liquidity, you can start to visualize the opportunity. And then secondly, our loan economics have not been positive.

And as a result of that, our appetite to spend on marketing hasn't been as high as it's going to be. A little later this year, right? And so as a result of that, we see our origination business growing on higher volumes as we continue to push the metal to the pedal in terms of spending more to create more origination volume and then combining that with our Beeline equity product, getting to 700 transactions to create the $100 million run rate seems like a very obtainable task.

And then just last question, we basically have one day left in the quarter. You mentioned the fourth quarter was sequentially up at the 8.3%, you said. The same trends showing up in the first quarter, can you comment at all on the direction we're seeing?

Yeah, let me take that, Nick. So obviously, I got to be careful about giving any guidance, but. I think, I'm not trying to lecture you, I think, Mike, you recognize that this is a somewhat seasonal business, so Beeline, I would say, is less seasonal than the average mortgage banker.

But the fourth quarter tends to be soft just because on the purchase side, people who aren't usually closing on houses in November, and then we have basically. A 12-week quarter that three or four weeks are zipped out of it because of the holidays. So typically, if for someone that's running more or less level, the fourth quarter will be down. So the fourth quarter was up 8 point something percent. First quarter will be up yet again, but I'm not going to say the amount, but it's not 8.7%.

(Operator Instructions) Jacob Frank, private investor.

Hey, Chris. Great results.

Just want to check, are we on track to be cash flow positive as a group, not just the lending entity? Because the last update was in October 2025. And also, I just want to ask about the Series A redemption. They look like a very friendly deal for the company. So I don't know like what's the color, what's the background, what motivated the investors to offer on these terms?

Thank you.

Yeah, I'll take the first part and then I'll let Chris go ahead, Chris.

Well, I was going to say, I'll take the first question and you can take the second one, but we can play around as needed. So, yes, so thanks for your question. Yes, we're very much on trend and our results for last year were clouded. Both from the investor perspective and also internally, just because so much was going on in our birthing process of becoming a public company.

But almost all that static is behind us. We're very focused on operations, and I'm confident that the lines will cross in a positive way in the near future. More than that, I can't say for obvious reasons, but to answer your question, we're very much on track, if not above the expected trajectory. Nick, do you want to comment on the Series A?

Yes, what was the question in the Series A? I'm sorry.

Yes, so the question is, what's the background and what motivated the investors to offer the terms because the issue price actually went up, so I believe we save on issuance of shares.

So the Series A has now been retired. Basically, the way that. That series worked was we had the holders had the right to convert at $1.75 and we had the right to buy the shares back at $2. And so as the market started to, as the war broke out, right, we were uncertain of how we wanted to handle that with a pending. Date of the end of May for the holder to convert. And so we went to the holder and we negotiated a $2.25 conversion.

We issued the shares and put that to bed.

And now we've got very limited preferred overhang that's currently in the cap table with the Series A currently completely retired.

Got it. That's amazing. I do have one last question.

I know that we have the market program and I understand the potential users could be investments, acquisitions and other things, right? So how is the management thinking about the overall capital allocation strategy and how is the money being spent? Because I also know that prevention B is still costing us 6% annually, so any point around it?

Yeah, I think the question is how do we see potential acquisitions going forward? Is that the root of the question?

No, it's like, how do we decide on how we spend the money? Because I believe we have so many areas we can spend on hiring, budget investments, could even potentially retiring the, I believe, the last remaining professional share be.

Yeah, got it. Look, our primary focus is spending our money to grow our revenue. As profitably as we possibly can.

And as mentioned on this call, right, we're in a position now where that spend is not as great as it once was in developing and building the platform and then leveraging the AI to be even more productive. So on a going-forward basis, that's where we're going to put our dollars. It's a lot fewer dollars than what we've had to put toward in the past.

And as it relates to, I think you mentioned acquisitions, I mean, look, we're going to look at potential acquisitions at some point next year. There's a lot of opportunity to potentially, A, consolidate or B, pick up a company that can drive business to our platform. But as of right now, the dollars we're going to spend are going to be driving transactions, and that would include forming partnerships potentially with entities that can drive business at the end of the day. And so there may be some dollars spent in that direction as well.

Okay, thank you.

Wishing all of you all the best.

Thank you very much. We appreciate that.

Thank you.

This concludes our question-and-answer session. I would like to turn the conference back over to Nick Liuzza for any closing remarks.

I want to thank everyone for their support. We're now in our first year as a public company. The management team, I want to let everyone know, is completely committed. We are -- we sit side by side with our shareholders as every member on this phone is an investor in Beeline with their own hard, personal cash, and it goes way beyond the three of us.

So as we move forward, understand that the decisions we're making are not only for the best of Beeline, but for the shareholders, and we're shareholders as well. We've got our next earnings call in the next 45 days, since this one was a little late in the quarter. We look forward to seeing everyone on that call and sharing our Q1 results.

Thank you, everyone.

The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.