Blend Labs, Inc.

Previous wording

Blend Labs, Inc. was founded in 2012, with a vision to bring simplicity and transparency to financial services, so everyone can gain access to the capital they need to lead better lives. To realize this vision, we have built a market-leading cloud-based software platform and suite of products for financial services firms that is designed to power the end-to-end consumer journey for any banking product. Our software platform was built in an extensible, modular, and configurable fashion to support continued product expansion. We have technology, data, and service providers on our software platform, including an extensive marketplace of insurance carriers, real estate agents, and settlement agencies. Our products and marketplaces provide multiple opportunities for us to serve financial services firms and consumers and drive revenue growth.

Current wording

Blend Labs, Inc. was founded in 2012, with a vision to bring simplicity and transparency to financial services, so everyone can gain access to the capital they need to lead better lives. To realize this vision, we have built a market-leading cloud-based software platform and suite of products for financial services firms that is designed to power the end-to-end consumer journey for any banking product. Our software platform was built in an extensible, modular, and configurable fashion to support continued product expansion. We have technology, data, and service providers on our software platform, including access to an extensive marketplace of insurance carriers and settlement agencies. Our products and marketplaces provide multiple opportunities for us to serve financial services firms and consumers and drive revenue growth.

Previous wording

We recently introduced Composable Origination, which gives our customers the ability to easily configure or build custom workflows from a pre-built set of components, all while leveraging existing infrastructure. Financial services firms can experience Composable Origination by building custom solutions using our Blend Builder Platform, or with pre-built solutions such as Instant Home Equity, Deposit Accounts, Credit Cards and more.

Current wording

Our platform also includes Blend Builder, which gives our customers the ability to easily configure or build custom workflows from a pre-built set of components, all while leveraging existing infrastructure. Financial services firms can create custom solutions with Blend Builder, or choose from pre-built solutions for Mortgage and Consumer Banking, including Home Equity, Deposit Accounts, Credit Cards, Personal Lending, Auto Lending and more.

Previous wording

The mortgage market is heavily influenced by government policies and overall economic conditions. The real estate environment, including interest rates and the general economic environment, typically impacts the demand for mortgage and mortgage related products. Recent changes in these areas have impacted our results of operations. Purchase volume and refinance activity were strong in 2020 and 2021 relative to historical averages over the preceding decade; however, an increase in interest rates due to efforts by the Federal Reserve to manage rising inflation, combined with ongoing supply constraints, resulted in a decline in mortgage origination activity in both 2022 and 2023.

Current wording

The mortgage market is heavily influenced by government policies and overall economic conditions. The real estate environment, including interest rates and the general economic environment, typically impacts the demand for mortgage and mortgage related products. Since 2022, increases in interest rates due to efforts by the Federal Reserve to manage rising inflation, combined with ongoing supply constraints, have resulted in a relative decline in mortgage origination activity, followed by a slight increase in 2024 as compared to 2023, based on the estimates of the industry forecasters.

Previous wording

Industry forecasters estimate that mortgage origination activity increased in the first nine months of 2024 compared to the same period last year, and predict such increase in activity will continue into the final three months of 2024 and into 2025 compared to the same periods in the prior years, respectively. This increase depends on many factors, such as changes in the Federal Reserve’s policies or pressures in the macroeconomic environment, all of which are uncertain and out of our control. As a large portion of our revenue is driven by mortgage and mortgage related transaction volumes, changes in mortgage origination volumes have had, and are likely to continue to have, material effects on our business.

Current wording

Mortgage origination activity depends on many factors, such as changes in the Federal Reserve’s policies or pressures in the macroeconomic environment, including the imposition of tariffs, the impact of trade relations or the possibility of an economic downturn in the United States or worldwide, all of which are uncertain and out of our control. We expect the Federal Reserve's decision-making to continue to have impacts on mortgage origination activity. As a large portion of our revenue is driven by mortgage and mortgage related transaction volumes, changes in the mortgage origination volumes have had, and are likely to continue to have, material effects on our business.

Previous wording

In our Blend Platform segment, we generate revenue from fees paid by customers to access our software platform and complete the transactions. Fees are assessed based on completed transactions, such as a funded loan, new account opening, closing transaction or API call. Completed transaction fees are determined by the number and type of software platform components that are needed to support each product offering. We do not charge for abandoned or rejected applications, even though they cause us to incur costs related to these applications. Arrangements with our customers do not provide the contractual right to take possession of our software at any point in time. Revenue is recognized when access to our platform is provisioned to our customers or as transactions are completed, in an amount that reflects the consideration we expect to be entitled to in exchange for those services. To a lesser extent, we generate revenue from professional services related to the deployment of our platform, premier support services, and consulting services. We also earn revenue through commissions or service fees when consumers use our Blend Platform integrated marketplaces to select a property and casualty insurance carrier, or real estate agent.

Current wording

We generate revenue from fees paid by customers to access our software platform and complete the transactions. Fees are assessed based on completed transactions, such as a funded loan, new account opening, closing transaction or API call. Completed transaction fees are determined by the number and type of software platform components that are needed to support each product offering. We do not charge for abandoned or rejected applications, even though they cause us to incur costs related to these applications. Arrangements with our customers do not provide the contractual right to take possession of our software at any point in time. Revenue is recognized when access to our platform is provisioned to our customers or as transactions are completed, in an amount that reflects the consideration we expect to be entitled to in exchange for those services. We also generate revenue from providing access to Blend Builder, professional services related to the deployment of our platform, premier support services, and consulting services. We also earn revenue from third-party providers which integrate their marketplaces into our platform for services such as property and casualty insurance. We typically charge third-party providers a combination of fixed and variable license fees.

Previous wording

Our customers have the ability to access our platform under subscription arrangements, in which customers commit to a minimum number of completed transactions at specified prices over the contract term, or under usage-based arrangements, in which customers prepay a fixed amount in advance, typically annually or semi-annually, based on their anticipated consumption of specified products at specified prices or pay monthly in arrears a variable amount for completed transactions at specified prices. Our subscription and prepaid usage-based arrangements are generally noncancelable, and we may also earn additional overage fees if the number of completed transactions exceeds the contractual amounts. Our usage-based arrangements paid in arrears can generally be terminated at any time by the customer. We recognize revenue ratably for our subscription arrangements because the customer receives and consumes the benefits of our platform throughout the contract period. We recognize fees for usage-based arrangements as the completed transactions are processed using our platform. Over the last year, we have seen a shift away from subscription arrangements towards prepaid multi-year usage-based arrangements in our customer contracts.

Current wording

Our customers have the ability to access our platform under subscription arrangements, in which customers commit to a minimum number of completed transactions at specified prices over the contract term, or under usage-based arrangements, in which customers prepay a fixed amount in advance, typically annually or semi-annually, based on their anticipated consumption of specified products at specified prices or pay monthly in arrears a variable amount for completed transactions at specified prices. Our subscription and prepaid usage-based arrangements are generally noncancelable, and we may also earn additional overage fees if the number of completed transactions exceeds the contractual amounts. Our usage-based arrangements paid in arrears can generally be terminated at any time by the customer. We recognize revenue ratably for our subscription arrangements because the customer receives and consumes the benefits of our platform throughout the contract period. We recognize fees for usage-based arrangements as the completed transactions are processed using our platform. Over the last year, we have seen a shift away from subscription arrangements towards prepaid multi-year usage-based arrangements in our customer contracts. Revenue from third-party providers for access to our platform is recognized ratably over the term of the contract.

Previous wording

In our Blend Platform segment, cost of revenue consists primarily of software-related costs, which include costs of subscribed hosting and support, costs of premier support services, and the costs of delivering professional services.

Current wording

Cost of revenue consists primarily of software-related costs, which include costs of subscribed hosting and support, costs of premier support services, and the costs of delivering professional services.

Previous wording

We have taken actions to manage our operating expenses and focus our investments on initiatives critical to achieving our broader strategy. We expect to see ongoing improvements to our expenses from these actions in the remainder of 2024.

Current wording

We have taken actions to manage our operating expenses and focus our investments on initiatives critical to achieving our broader strategy. We expect to see our expenses slightly decrease in 2025 as compared to 2024.

Previous wording

Research and development expenses consist primarily of personnel-related expenses, including stock-based compensation expense, associated with our engineering personnel responsible for the design, development, and testing of new products and features, professional and outside services fees, software and hosting costs, and allocated overhead costs. Research and development costs are expensed as incurred, unless they qualify as capitalizable internal-use software development costs.

Current wording

Research and development expenses consist primarily of personnel-related expenses, including stock-based compensation expense, associated with our engineering personnel responsible for the design, development, and testing of new products and features, professional and outside services fees, software and hosting costs, facilities costs, and allocated overhead costs. Research and development costs are expensed as incurred, unless they qualify as capitalizable internal-use software development costs.

Previous wording

Sales and marketing expenses consist primarily of personnel-related expenses, including stock-based compensation expense, costs of general marketing activities, advertising and promotional activities, travel-related expenses, and allocated overhead costs. Sales commissions that are incremental costs of acquiring a contract with a customer as well as associated payroll taxes, are deferred and amortized on a straight-line basis over the estimated period of benefit. Sales commissions that are not incremental costs of acquiring a contract with a customer are expensed in the period incurred.

Current wording

Sales and marketing expenses consist primarily of personnel-related expenses, including stock-based compensation expense, costs of general marketing activities, advertising and promotional activities, travel-related expenses, facilities costs, and allocated overhead costs. Sales commissions that are incremental costs of acquiring a contract with a customer as well as associated payroll taxes, are deferred and amortized on a straight-line basis over the estimated period of benefit. Sales commissions that are not incremental costs of acquiring a contract with a customer are expensed in the period incurred.

Previous wording

General and administrative expenses consist primarily of personnel-related expenses, including stock-based compensation expense for our finance, accounting, legal and compliance, human resources, and other administrative teams, certain executives, stock-based compensation expense related to the stand-alone stock option award granted to our Co-Founder and Head of Blend in 2021, professional services fees, including audit, legal and compliance, software and hosting costs, external consulting expenses, and insurance expenses.

Current wording

General and administrative expenses consist primarily of personnel-related expenses, including stock-based compensation expense for our finance, accounting, legal and compliance, human resources, and other administrative teams, certain executives, stock-based compensation expense related to the stand-alone stock option award granted to our Co-Founder and Head of Blend in 2021, professional services fees, including audit, legal and compliance, facilities costs, software and hosting costs, external consulting expenses, and insurance expenses.

Previous wording

Restructuring charges relate to our workforce reduction plans and facilities restructuring actions. Charges related to workforce reduction plans are comprised of cash expenditures for compensation and severance payments, executive transition costs, employee benefits, payroll taxes and related facilitation costs. Charges related to facilities restructuring actions are comprised of costs related to early termination of the lease agreement and impairment of the right-of-use asset in connection with the abandonment of the property. Refer to Note 13, Restructuring, of the Notes to Condensed Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q for additional information.

Current wording

Restructuring charges relate to our workforce reduction plans and facilities restructuring actions. Charges related to workforce reduction plans are comprised of cash expenditures for compensation and severance payments, employee benefits, payroll taxes and related facilitation costs. Refer to Note 12, Restructuring, of the Notes to Unaudited Condensed Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q, for additional information.

Previous wording

Other income (expense), net consists primarily of interest income earned from our investment portfolio. For the nine months ended September 30, 2024, other income (expense), net also includes a gain on sale of insurance business in connection with strategic partnership, an adjustment to the carrying value of investment in non-marketable equity securities, a loss on extinguishment of debt, and a loss on transfer of our subsidiary in India.

Current wording

Other income (expense), net consists primarily of interest income earned from our investment portfolio. For the three months ended March 31, 2025, other income (expense), net also includes an adjustment to the carrying value of investment in non-marketable equity securities.

Previous wording

(2) Net of $0.8 million and $1.9 million of additions to capitalized internal-use software for the three and nine months ended September 30, 2024, respectively, and none for the three and nine months ended September 30, 2023.

Current wording

(2) Net of $1.2 million of additions to capitalized internal-use software for the three months ended March 31, 2025, and $0.6 million for the three months ended March 31, 2024.

Previous wording

Revenue remained flat for the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023, driven by the offsetting impact of a decrease in Title segment revenue of $2.1 million, or 6%, primarily due to the lower volume of title orders, and an increase in Blend Platform revenue of $2.0 million, or 2%. Within Blend Platform revenue, Mortgage Suite revenue decreased $5.3 million, or 9%, primarily due to the lower volume of mortgage banking transactions with our customers, Consumer Banking Suite revenue increased $7.0 million, or 41%, primarily due to the increase in home equity transactions and incremental platform fees, due to new deployments, and an increase in attach rates of our digital closing solution, and Professional Services revenue increased by $0.3 million, or 5%, primarily due to an increase in professional services associated with the support of our platform.

Current wording

•Consumer Banking Suite revenue increased $3.0 million, or 45%, primarily due to an increase in home equity and deposit account opening transaction volumes and an increase in attach rates of our digital closing solution.

Previous wording

Gross profit increased $3.9 million, or 18% for the three months ended September 30, 2024 compared to the three months ended September 30, 2023.

Current wording

Gross profit increased $2.9 million, or 18% for the three months ended March 31, 2025 compared to the three months ended March 31, 2024 due to increased revenue.

Previous wording

Research and development expenses decreased $8.7 million, or 46%, for the three months ended September 30, 2024 compared to the three months ended September 30, 2023. The decrease was primarily due to a $4.2 million capitalization of internal-use software development costs, a $3.0 million decrease in personnel related expenses, and a $1.1 million decrease in stock-based compensation expense attributable to a decrease in headcount, in each case, related to our restructuring actions, and a $0.3 million decrease in software and hosting costs.

Current wording

Research and development expenses decreased $6.7 million, or 47%, for the three months ended March 31, 2025 compared to the three months ended March 31, 2024. The decrease was primarily due to a $3.1 million decrease due to the capitalization of internal-use software development costs, as well as a $2.3 million decrease in personnel related expenses and a $1.1 million decrease in stock-based compensation expense attributable to a decrease in headcount, in each case, related to our restructuring actions.

Previous wording

Sales and marketing expenses decreased $4.6 million, or 32%, for the three months ended September 30, 2024 compared to the three months ended September 30, 2023. The decrease was primarily due to a $2.1 million decrease in personnel related expenses and a $0.7 million decrease in stock-based compensation expense attributable to a decrease in headcount, in each case, related to our restructuring actions, a $1.4 million decrease in commissions, a $0.3 million decrease in software and hosting costs, and a $0.2 million decrease in advertising and promotion expenses.

Current wording

Sales and marketing expenses decreased $2.6 million, or 26%, for the three months ended March 31, 2025 compared to the three months ended March 31, 2024. The decrease was primarily due to a $1.8 million decrease in personnel related expenses attributable to a decrease in headcount related to our restructuring actions and a $0.7 million decrease in commissions.

Previous wording

General and administrative expenses decreased $2.7 million, or 17%, for the three months ended September 30, 2024 compared to the three months ended September 30, 2023. The decrease was primarily due to a $1.4 million decrease in personnel related expenses attributable to a decrease in headcount related to our restructuring actions, a $0.9 million decrease in external consulting expenses, and a $0.4 million decrease in insurance expenses.

Current wording

General and administrative expenses decreased $1.1 million, or 9%, for the three months ended March 31, 2025 compared to the three months ended March 31, 2024. The decrease was primarily due to a $1.7 million decrease in personnel related expenses, a $0.4 million decrease in facilities costs and a $0.2 million decrease in insurance expenses, offset by a $0.9 million increase in professional and outside services costs and a $0.1 million increase in travel and entertainment costs.

Previous wording

Restructuring expenses decreased $3.0 million, or 32%, for the three months ended September 30, 2024 compared to the three months ended September 30, 2023 due to the execution of the August 2023 workforce reduction plan, which was larger than the September 2024 workforce reduction plan, which was partially offset by facilities-related restructuring charges incurred for three months ended September 30, 2024. The costs related to each workforce reduction plan included cash expenditures for compensation and severance payments, executive transition costs, employee benefits, payroll taxes and related facilitation costs.

Current wording

Restructuring expenses decreased $0.3 million, or 26%, for the three months ended March 31, 2025 compared to the three months ended March 31, 2024 due to the 2024 workforce reduction plan being larger than the 2025 workforce reduction plan. The costs related to each workforce reduction plan included cash expenditures for compensation and severance payments, employee benefits, payroll taxes and related facilitation costs.

Previous wording

Interest expense decreased $8.2 million, or 100%, for the three months ended September 30, 2024 compared to the three months ended September 30, 2023, primarily due to the optional prepayment of the outstanding Term Loan under the Credit Agreement in an aggregate principal amount of $85.0 million on November 27, 2023 and repayment of all remaining amounts outstanding and payable under the Credit Agreement in an aggregate amount of $146.1 million on April 29, 2024. The borrowings under the Credit Agreement accrued interest at a floating rate which could be, at our option, either (i) an adjusted Term SOFR rate for a specified interest period plus an applicable margin of 7.50% or (ii) a base rate plus an applicable margin of 6.50%. The effective interest rate on our Term Loan was approximately 14.55% as of April 29, 2024, the date of its termination.

Current wording

Interest expense decreased $5.1 million, or 100%, for the three months ended March 31, 2025 compared to the three months ended March 31, 2024, primarily due to the repayment of all remaining amounts outstanding and payable under the Credit Agreement in an aggregate amount of $146.1 million on April 29, 2024. The borrowings under the Credit Agreement accrued interest at a floating rate which could be, at our option, either (i) an adjusted Term SOFR rate for a specified interest period plus an applicable margin of 7.50% or (ii) a base rate plus an applicable margin of 6.50%. The effective interest rate on our Term Loan was approximately 14.55% as of April 29, 2024, the date of its termination.

Previous wording

Other income (expense), net increased $3.2 million, or 37%, for the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023. The increase was primarily due to an $9.2 million gain on sale of insurance business in connection with the strategic partnership, a $4.4 million gain on investment on non-marketable equity securities due to an observable price change, offset by a $5.5 million loss on extinguishment of debt recognized in the nine months ended September 30, 2024, a $4.6 million decrease in interest income on our investment portfolio due to a smaller invested cash balance in the nine months ended September 30, 2024, as compared to the nine months ended September 30, 2023, and a $0.6 million loss on transfer of our subsidiary in India.

Current wording

Other income (expense), net decreased $4.5 million, or 80%, for the three months ended March 31, 2025 compared to the three months ended March 31, 2024. The decrease was primarily due to a $4.4 million gain on investment on non-marketable equity securities recognized in the three months ended March 31, 2024 due to an observable price change.

Previous wording

Since our inception, we have financed our operations primarily through proceeds from the issuance of our stock and warrants and cash generated from the sale of our product offerings, as well as debt financing. As of September 30, 2024, our principal sources of liquidity were cash, cash equivalents, and marketable securities of $116.8 million. Cash and cash equivalents are comprised of bank deposits and money market funds. Marketable securities are comprised of U.S. treasury and agency securities, commercial paper, and corporate debt securities. Most of our cash and cash equivalents are held in the United States.

Current wording

Since our inception, we have financed our operations primarily through proceeds from the issuance of our stock and warrants and cash generated from the sale of our product offerings, as well as debt financing. As of March 31, 2025, our principal sources of liquidity were cash, cash equivalents, and marketable securities of $104.8 million. Cash and cash equivalents are comprised of bank deposits and money market funds. Marketable securities are comprised of U.S. treasury and agency securities, commercial paper, and corporate debt securities. Most of our cash and cash equivalents are held in the United States.

Previous wording

We have generated significant losses from operations and negative cash flows from operating activities in the past as reflected in our accumulated deficit of $1,384.1 million as of September 30, 2024. We may incur operating losses in the future due to the investments that we intend to make in our business and pressures on revenue growth due to the recent macroeconomic environment, and as a result, we may require additional capital resources to grow our business.

Current wording

We have generated significant losses from operations and negative cash flows from operating activities in the past as reflected in our accumulated deficit of $1,394.2 million as of March 31, 2025. We may incur operating losses in the future due to the investments that we intend to make in our business and pressures on revenue growth due to the recent macroeconomic environment, and as a result, we may require additional capital resources to grow our business.

Previous wording

In August 2024, we announced the authorization of a share repurchase program for the repurchase of shares of our Class A common stock, in an aggregate amount up to $25 million. Repurchases may be made at out discretion from time to time through open market purchases or through privately negotiated transactions subject to market conditions, applicable legal requirements, and other relevant factors. Open market repurchases may be structured to occur in accordance with the requirements of Rule 10b-18 of the Exchange Act. We may also, from time to time, enter into Rule 10b5-1 plans to facilitate repurchases of our Class A common stock under this authorization. The share repurchase program does not obligate us to repurchase any specific dollar amount or to acquire any specific number of shares of our Class A common stock. The timing and actual number of shares repurchased may depend on a variety of factors, including price, general business and market conditions, and alternative investment opportunities. During the three and nine months ended September 30, 2024, we did not repurchase any of our Class A common stock under our share repurchase program. As of September 30, 2024, approximately $25 million remained authorized and available under our share repurchase program for future share repurchases. Please refer to Note 11, Stockholder’s Equity, of the Notes to Condensed Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q for additional information.

Current wording

In August 2024, we announced the authorization of a share repurchase program for the repurchase of shares of our Class A common stock, in an aggregate amount up to $25 million. Repurchases may be made at out discretion from time to time through open market purchases or through privately negotiated transactions subject to market conditions, applicable legal requirements, and other relevant factors. Open market repurchases may be structured to occur in accordance with the requirements of Rule 10b-18 of the Exchange Act. We may also, from time to time, enter into Rule 10b5-1 plans to facilitate repurchases of our Class A common stock under this authorization. The share repurchase program does not obligate us to repurchase any specific dollar amount or to acquire any specific number of shares of our Class A common stock. The timing and actual number of shares repurchased may depend on a variety of factors, including price, general business and market conditions, and alternative investment opportunities. During the three months ended March 31, 2025, we repurchased and retired 922,996 shares of our Class A common stock for $3.1 million. As of March 31, 2025, approximately $21.9 million remained authorized and available under our share repurchase program for future share repurchases. Refer to Note 10, Stockholder’s Equity, of the Notes to Unaudited Condensed Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q, for additional information.

Previous wording

On April 29, 2024, we entered into the Investment Agreement with Haveli and issued 150,000 shares of the Company’s Series A Preferred Stock for an aggregate purchase price of $150.0 million. In connection with the issuance of the Series A Preferred Stock, we issued the Warrant to Haveli to purchase up to 11,111,112 shares of Class A common stock, at a purchase price of $4.50 per share of Class A common stock. The Warrant is exercisable for a period of 24 months from issuance.

Current wording

On April 29, 2024, we entered into an Investment Agreement (the “Investment Agreement”) with Haveli Brooks Aggregator L.P. (“Haveli”) and issued 150,000 shares of our Series A Preferred Stock (the “Series A Preferred Stock”) for an aggregate purchase price of $150.0 million. In connection with the issuance of the Series A Preferred Stock, we issued the Haveli Warrant to purchase up to 11,111,112 shares of Class A common stock, at a purchase price of $4.50 per share of Class A common stock. The Haveli Warrant is exercisable for a period of 24 months from issuance.

Previous wording

After the termination of the Credit Agreement, our material cash requirements arising from known contractual and other obligations primarily relate to lease obligations for our office locations and purchase commitments. Other than the changes in our lease obligations described in Note 7, Leases, of the Notes to Condensed Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q, there have been no significant changes in our material cash requirements from the contractual obligations described in our Annual Report on Form 10-K for the year ended December 31, 2023.

Current wording

Our material cash requirements arising from known contractual and other obligations primarily relate to lease obligations for our office locations and purchase commitments.

Previous wording

We believe that current cash, cash equivalents and marketable securities will be sufficient to fund our operations for at least the next 12 months. Our future capital requirements, however, will depend on continued growth in our customer base, the timing and extent of spending to support our research and development efforts, the expansion of sales and marketing activities, the introduction of new and enhanced products and features, the continuing market adoption of Blend’s software platform, and the effectiveness of our efforts to improve cost efficiency. We may in the future enter into arrangements to acquire or invest in complementary businesses, services, and technologies, including intellectual property rights; additionally, we may repurchase shares of our Class A common stock from time to time under our share repurchase program. In the event that additional financing is required from outside sources, we may seek to raise additional funds at any time through equity, equity-linked arrangements, and debt. If we are unable to raise additional capital when desired and at reasonable rates, our business, results of operations, and financial condition would be adversely affected. See the section titled “Risk Factors—Risks Related to Our Business—Our failure to raise additional capital or generate cash flows necessary to expand our operations and invest in new technologies in the future could reduce our ability to compete successfully and harm our results of operations.”

Current wording

We believe that current cash, cash equivalents and marketable securities will be sufficient to fund our operations for at least the next 12 months. Our future capital requirements, however, will depend on continued growth in our customer base, the timing and extent of spending to support our research and development efforts, the expansion of sales and marketing activities, the introduction of new and enhanced products and features, the continuing market adoption of Blend’s software platform, and the effectiveness of our efforts to improve cost efficiency. We may in the future enter into arrangements to acquire or invest in complementary businesses, services, and technologies, including intellectual property rights; additionally, we may repurchase shares of our Class A common stock from time to time under our share repurchase program. In the event that additional financing is required from outside sources, we may seek to raise additional funds at any time through equity, equity-linked arrangements, and debt. If we are unable to raise additional capital when desired and at reasonable rates, our business, results of operations, and financial condition would be adversely affected. See the section titled “Risk Factors—Risks Related to Our Business and Operations—We may require additional capital to support business growth, and this capital might not be available on acceptable terms, if at all..”

Previous wording

Cash Used in Operating Activities

Current wording

Cash Provided by (Used in) Operating Activities

Previous wording

Net cash used in operating activities for the nine months ended September 30, 2024 and 2023 was $8.5 million and $106.9 million, respectively. The decrease in cash used in operations reflects our net loss adjusted for noncash items, such as charges associated with stock-based compensation, depreciation and amortization, gain on investment in equity securities, amortization of deferred contract costs, amortization of operating lease right-of-use assets, and amortization of debt discount and issuance costs on our long-term debt, loss on debt extinguishment, gain on sale of insurance business, and changes in operating assets and liabilities. Fluctuations in operating assets and liabilities are affected primarily by changes in trade and other receivables, prepaid expenses and other current assets, accrued compensation, deferred revenue, accounts payable and other liabilities.

Current wording

Net cash provided by (used in) in operating activities for the three months ended March 31, 2025 and 2024 was $20.1 million and $3.0 million, respectively. The change in cash from operations reflects our net loss adjusted for noncash items, such as charges associated with stock-based compensation, depreciation and amortization, gain on investment in equity securities, amortization of deferred contract costs, amortization of operating lease right-of-use assets, and amortization of debt discount and issuance costs on our long-term debt, and changes in operating assets and liabilities. Fluctuations in operating assets and liabilities are affected primarily by changes in trade and other receivables, prepaid expenses and other current assets, deferred contract costs, accrued compensation, deferred revenue, accounts payable and other liabilities.

Previous wording

Net cash provided by investing activities during the nine months ended September 30, 2023 was $74.1 million, which was primarily due to the maturities of marketable securities of $277.9 million, offset by purchases of $203.3 million of marketable securities and $0.5 million in purchases of property and equipment.

Current wording

Net cash provided by investing activities during the three months ended March 31, 2025 was $3.3 million, which was primarily due to maturities of marketable securities of $18.9 million and sales of marketable securities of $0.8 million, offset by $11.9 million used in the purchase of marketable securities and $4.6 million in additions to property and equipment, primarily related to capitalized internal-use software development costs.

Previous wording

Net cash provided by investing activities during the nine months ended September 30, 2024 was $47.3 million, which was primarily due to sales of marketable securities of $100.3 million and maturities of marketable securities of $41.9 million, $9.1 million proceeds from sale of insurance business, offset by $96.4 million used in the purchase of marketable securities and $7.3 million in additions of property and equipment, primarily related to capitalized internal-use software development costs.

Current wording

Net cash provided by investing activities during the three months ended March 31, 2024 was $60.6 million, which was primarily due to sales of marketable securities of $100.3 million and maturities of marketable securities of $10.6 million, offset by $48.3 million used in the purchase of marketable securities and $2.0 million in additions to property and equipment related to capitalized internal-use software development costs.

Previous wording

Net cash used in financing activities for the nine months ended September 30, 2024 was $14.7 million, primarily consisting of $144.5 million repayment of long-term debt, $9.5 million payment of issuance costs related to the Series A Preferred Stock and the Warrant, payment of taxes related to net share settlement of equity awards of $11.0 million, offset by $149.4 million proceeds from the issuance of Series A Preferred Stock and the Warrant, and proceeds from the exercises of stock options of $0.9 million.

Current wording

Net cash used in financing activities for the three months ended March 31, 2025 was $5.2 million, primarily consisting of payment of taxes related to net share settlement of equity awards of $3.0 million and $2.6 million related to share repurchases, offset by $0.4 million proceeds from the exercises of stock options.

Previous wording

Net cash used in financing activities for the nine months ended September 30, 2023 was $4.9 million, primarily consisting of payment of taxes related to net share settlement of equity awards.

Current wording

Net cash used in financing activities for the three months ended March 31, 2024 was $3.2 million, primarily consisting of payment of taxes related to net share settlement of equity awards of $3.8 million, offset by proceeds from the exercises of stock options of $0.6 million.

Previous wording

As of September 30, 2024, we did not have any other relationships with unconsolidated entities or financial partnerships, such as structured finance or special purpose entities that were established for the purpose of facilitating off-balance sheet arrangements or other purposes.

Current wording

As of March 31, 2025, we did not have relationships with unconsolidated entities or financial partnerships, such as structured finance or special purpose entities that were established for the purpose of facilitating off-balance sheet arrangements or other purposes.

Previous wording

Our unaudited condensed consolidated financial statements and the related notes thereto included elsewhere in this Quarterly Report on Form 10-Q are prepared in accordance with the U.S. generally accepted accounting principles (“U.S. GAAP”). The preparation of our condensed consolidated financial statements in accordance with U.S. GAAP requires us to make estimates, judgments, and assumptions that affect the reported amounts of assets, liabilities, revenue, costs, and expenses, and related disclosures. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. Our actual results may differ from these estimates under different assumptions or conditions. To the extent that there are differences between our estimates and actual results, our future financial statement presentation, financial condition, results of operations, and cash flows could be affected.

Current wording

Our unaudited condensed consolidated financial statements and the related notes thereto included elsewhere in this Quarterly Report on Form 10-Q are prepared in accordance with the U.S. generally accepted accounting principles (“U.S. GAAP”). The preparation of our unaudited condensed consolidated financial statements in accordance with U.S. GAAP requires us to make estimates, judgments, and assumptions that affect the reported amounts of assets, liabilities, revenue, costs, and expenses, and related disclosures. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. Our actual results may differ from these estimates under different assumptions or conditions. To the extent that there are differences between our estimates and actual results, our future financial statement presentation, financial condition, results of operations, and cash flows could be affected.

Previous wording

Refer to Note 2, Summary of Significant Accounting Policies, of the Notes to Condensed Consolidated Financial Statements in Part I, Item 1 of this Quarterly Report on Form 10-Q.

Current wording

Refer to Note 2, Summary of Significant Accounting Policies, of the Notes to Unaudited Condensed Consolidated Financial Statements in Part I, Item 1 of this Quarterly Report on Form 10-Q.