Blend Labs, Inc.

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. In the second quarter of 2026, we saw an increase in mortgage transactions on our software platform compared to the first quarter of 2026, which can be attributed primarily to seasonal trends within the purchase market.

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. In the second quarter of 2026, we saw an increase in mortgage transactions on our software platform compared to the first quarter of 2026, which can be attributed primarily to seasonal trends within the purchase market. In the third quarter of 2026, we saw a reduction in mortgage transactions on our software platform compared to the second quarter of 2026 primarily driven by a more challenging macroeconomic environment.

Previous wording

(2) Net of $0.1 million and $0.2 million of additions to capitalized internal-use software for the three and six months ended June 30, 2026, and $1.1 million and $2.3 million for the three and six months ended June 30, 2025, respectively.

Current wording

(2) Net of $0.1 million and $0.3 million of additions to capitalized internal-use software for the three and nine months ended September 30, 2026, and $0.6 million and $2.8 million for the three and nine months ended September 30, 2025, respectively.

Previous wording

•Mortgage Suite revenue increased by $3.8 million, or 12%, primarily due to an increase in overall mortgage market originations year-over-year, new customer deployments; partially offset by customer churn and the transition to a partnership model for verification of income.

Current wording

•Mortgage Suite revenue decreased by $0.4 million, or 2%, primarily due to churn, partially offset by new customer revenue. Mortgage market originations were estimated to be relatively flat year-over-year.

Previous wording

•Consumer Banking Suite revenue increased by $1.8 million, or 9%, primarily due to deployments of several large customers, partially offset by customer churn and the transition to a partnership model for verification of income.

Current wording

•Consumer Banking Suite revenue increased by $0.6 million, or 5%, primarily due to deployments of several large customers, partially offset by customer churn.

Previous wording

Cost of revenue increased by $0.7 million, or 8%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025, primarily due to increased costs incurred to support revenue growth.

Current wording

Cost of revenue increased by $0.7 million, or 9%, for the three months ended September 30, 2026 compared to the three months ended September 30, 2025, primarily due to increased costs incurred to support revenue growth.

Previous wording

Research and development expenses increased by $1.2 million, or 16%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025. The increase was primarily due to a $3.5 million decrease in the capitalization of internal-use software development costs, and a $0.3 million increase in software and hosting costs, offset by a $1.7 million decrease in personnel related expenses and a $0.8 million decrease in stock-based compensation expense attributable to a decrease in headcount, in each case, related to our restructuring actions.

Current wording

Research and development expenses decreased by $0.3 million, or 3%, for the three months ended September 30, 2026 compared to the three months ended September 30, 2025. The decrease was primarily due to a $1.7 million decrease in personnel and related expenses, a $0.7 million decrease in stock-based compensation expense, primarily attributable to a shift in the geographic mix of our workforce, a $0.2 million decrease in facilities and related expenses, primarily due to costs associated with an abandoned lease in the prior period, partially offset by a $1.8 million decrease in the capitalization of internal-use software development costs, and a $0.5 million increase in software and hosting costs.

Previous wording

General and administrative expenses decreased by $2.7 million, or 20%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025. The decrease was primarily due to a $1.0 million decrease in stock-based compensation expense, a $0.7 million decrease in facilities costs, a $0.5 million decrease in personnel related expenses attributable to a decrease in headcount, in each case, related to our restructuring actions, a $0.2 million decrease in new business initiative expenses, and a $0.2 million decrease in professional and outside services costs.

Current wording

General and administrative expenses decreased by $3.2 million, or 24%, for the three months ended September 30, 2026 compared to the three months ended September 30, 2025. The decrease was primarily due to a $1.9 million decrease in stock-based compensation expense, a $1.0 million decrease in personnel related expenses attributable to a decrease in headcount primarily related to our restructuring actions, a $0.3 million decrease in facilities costs, and a $0.3 million decrease in professional and outside services costs, partially offset by a $0.2 million increase in software and hosting expenses and a $0.2 million increase in insurance costs.

Previous wording

Restructuring expense was immaterial for three months ended June 30, 2026 and 2025.

Current wording

Restructuring expense was immaterial for the three months ended September 30, 2026 and 2025.

Previous wording

Other income (expense), net decreased by $0.8 million, or 78%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025. The decrease was primarily due to a $0.5 million decrease in interest income on our investment portfolio due to a smaller invested cash balance and a $0.2 million increase in commission expenses related to our share repurchases.

Current wording

Other income (expense), net decreased by $17.0 million, or 98%, for the three months ended September 30, 2026 compared to the three months ended September 30, 2025. The decrease was primarily due to a non-recurring $16.6 million gain on our investment in non-marketable equity securities due to an observable price change recognized during the three months ended September 30, 2025, and a $0.5 million decrease in interest income on our investment portfolio due to a smaller invested cash balance.

Previous wording

•Mortgage Suite revenue increased by $1.3 million, or 7%, primarily due to an increase in overall mortgage market originations year-over-year and new customer deployments; partially offset by customer churn and the transition to a partnership model for verification of income.

Current wording

•Mortgage Suite revenue increased by $3.5 million, or 7%, primarily due to an increase in overall mortgage market originations year-over-year, new customer deployments, partially offset by customer churn and the transition to a partnership model for verification of income.

Previous wording

•Consumer Banking Suite revenue increased by $0.7 million, or 6%, primarily due to deployments of several large customers, partially offset by customer churn and the transition to a partnership model for verification of income.

Current wording

•Consumer Banking Suite revenue increased by $2.4 million, or 7%, primarily due to deployments of several large customers, partially offset by customer churn and the transition to a partnership model for verification of income.

Previous wording

•Professional Services revenue increased by $0.6 million, or 12%, primarily due to an increase in services associated with the support of our platform.

Current wording

•Professional Services revenue increased by $0.6 million, or 8%, primarily due to an increase in services associated with the support of our platform.

Previous wording

Cost of revenue increased by $0.3 million for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 primarily due to increased usage costs commensurate with the growth in our revenue, partially offset by savings from our transition to a partnership model for verification of income and a favorable non-recurring benefit recognized in 2026.

Current wording

Cost of revenue increased by $1.0 million for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to increased usage costs commensurate with the growth in our revenue, partially offset by savings from our transition to a partnership model for verification of income and a favorable non-recurring benefit recognized in 2026.

Previous wording

Gross profit increased by $5.9 million, or 14%, for the six months ended June 30, 2026 compared to the six months ended June 30, 2025. Gross margin was 75% for the six months ended June 30, 2026 compared to 72% for the six months ended June 30, 2025. The increase in gross margin was primarily due to our transition to a lower-cost partnership model for verification of income services, as well as a one-time benefit recognized in cost of revenue during 2026.

Current wording

Gross profit increased by $5.4 million, or 8%, for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025. Gross margin was 74% for the nine months ended September 30, 2026 compared to 73% for the nine months ended September 30, 2025. The increase in gross margin was primarily due to our transition to a lower-cost partnership model for verification of income services, as well as a one-time benefit recognized in cost of revenue during 2026.

Previous wording

Research and development expenses increased by $2.8 million, or 18%, for the six months ended June 30, 2026 compared to the six months ended June 30, 2025. The increase was primarily due to a $7.7 million decrease in the capitalization of internal-use software development costs and a $0.9 million increase in software and hosting costs, offset by a $3.5 million decrease in personnel related expenses and a $1.8 million decrease in stock-based compensation expense and a $0.3 million decrease in facilities related expenses, each attributable to a decrease in headcount related to our restructuring actions.

Current wording

Research and development expenses increased by $2.5 million, or 10%, for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025. The increase was primarily due to a $9.5 million decrease in the capitalization of internal-use software development costs and a $1.3 million increase in software and hosting costs, partially offset by a $5.1 million decrease in personnel related expenses, a $2.5 million decrease in stock-based compensation expense, primarily attributable to a shift in the geographic mix of our workforce and a $0.5 million decrease in facilities related expenses as a result of abandoned lease related to our restructuring actions.

Previous wording

Sales and marketing expenses decreased by $1.2 million, or 8%, for the six months ended June 30, 2026 compared to the six months ended June 30, 2025. The decrease was primarily due to $0.5 million decrease in personnel related expenses attributable to a decrease in headcount and a $0.4 million decrease in facilities related expenses, each related to our restructuring actions, and a $0.5 million decrease in professional and outside services costs, offset by a $0.2 million increase in travel and entertainment expenses.

Current wording

Sales and marketing expenses decreased by $0.9 million, or 4%, for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025. The decrease was primarily due to a $0.6 million decrease in professional and outside services costs, a $0.6 million decrease in facilities related expenses and a $0.4 million decrease in personnel related expenses primarily attributable to a shift in the geographic mix of our workforce, partially offset by a $0.4 million increase in trade show and conference costs and a $0.3 million increase in travel and entertainment expenses.

Previous wording

General and administrative expenses decreased by $1.8 million, or 7%, for the six months ended June 30, 2026 compared to the six months ended June 30, 2025. The decrease was primarily due to a $0.7 million decrease in personnel and related expenses attributable to a decrease in headcount related to our restructuring actions, a $0.7 million decrease in facilities related expenses and a $0.5 million decrease in business taxes, both due to an abandoned lease related to our restructuring actions.

Current wording

General and administrative expenses decreased by $4.9 million, or 13%, for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025. The decrease was primarily due to a $1.7 million decrease in personnel and related expenses, a $1.7 million decrease in stock-based compensation, primarily attributable to a decrease in headcount related to our restructuring actions, a $0.7 million decrease in facilities related expenses as a result of abandoned lease related to our restructuring actions, and a $0.6 million decrease in business taxes, partially offset by a $0.3 million increase in software and hosting costs.

Previous wording

Restructuring expenses were materially consistent across the six months ended June 30, 2026 and the six months ended June 30, 2025, as the smaller headcount impact of the 2026 workforce reduction plan was offset by higher severance costs driven by differences in the composition of the impacted workforce. The costs related to each workforce reduction plan included cash expenditures for compensation and severance payments, employee benefits, payroll taxes and related facilitation costs.

Current wording

Restructuring expenses were materially consistent across the nine months ended September 30, 2026 and the nine months ended September 30, 2025, as the smaller headcount impact of the 2026 workforce reduction plan was offset by higher severance costs driven by differences in the composition of the impacted workforce. 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

Other income (expense), net decreased by $1.9 million, or 88%, for the six months ended June 30, 2026 compared to the six months ended June 30, 2025. The decrease was primarily driven by a $1.0 million reduction in interest income on our investment portfolio, reflecting a smaller invested cash balance and a change in investment mix compared to 2025, a $0.3 million unfavorable change in foreign currency remeasurement on intercompany balances with our Indian subsidiary, and a $0.4 million increase in commission expenses related to our share repurchases.

Current wording

Other income (expense), net decreased by $18.9 million, or 97%, for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025. The decrease was primarily driven by a non-recurring $16.6 million gain on our investment in non-marketable equity securities due to an observable price change recognized in the nine months ended September 30, 2025, a $1.4 million reduction in interest income on our investment portfolio, reflecting a smaller invested cash balance and a change in investment mix compared to 2025, a $0.4 million increase in commission expenses related to our share repurchases and a $0.2 million unfavorable change in foreign currency remeasurement on intercompany balances with our Indian subsidiary.

Previous wording

The increase in income tax expense for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 is attributable to an increase in business operations in India.

Current wording

The increase in income tax expense for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 is attributable to an increase in business operations in India.

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 June 30, 2026, our principal sources of liquidity were cash, cash equivalents, and marketable securities of $44.9 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. 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 September 30, 2026, our principal sources of liquidity were cash, cash equivalents, and marketable securities of $44.2 million. Cash and cash equivalents are comprised of bank deposits, U.S. treasury securities and money market funds. Marketable securities are comprised of U.S. treasury and agency securities. Most of our cash and cash equivalents are held in the United States.

Previous wording

Although we generated positive cash flow from operations for the six months ended June 30, 2026, we have generated significant losses from operations and negative cash flows from operating activities in the past as reflected in our accumulated deficit of $1,401.3 million as of June 30, 2026. 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

Although we generated positive cash flow from operations for the nine months ended September 30, 2026, we have generated significant losses from operations and negative cash flows from operating activities in the past as reflected in our accumulated deficit of $1,403.3 million as of September 30, 2026. 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

On March 10, 2026, 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 $50.0 million. Our prior share repurchase program was fully completed during the year ended December 31, 2025. Repurchases may be made at our 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 six months ended June 30, 2026, we repurchased and retired 12,177,584 and 22,218,943 shares of our Class A common stock for $20.2 million and $36.8 million, respectively. The Company had $13.2 million available to repurchase shares of Class A common stock under its share repurchase program as of June 30, 2026. Refer to Note 9, Stockholders’ 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.

Current wording

On March 10, 2026, 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 $50.0 million. Our prior share repurchase program was fully completed during the year ended December 31, 2025. Repurchases may be made at our 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 nine months ended September 30, 2026, the Company repurchased and retired 22,218,943 shares of the Company’s Class A common stock for $36.8 million. There were no stock repurchases during the three months ended September 30, 2026. The Company had $13.2 million available to repurchase shares of Class A common stock under its share repurchase program as of September 30, 2026. Refer to Note 9, Stockholders’ 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

Net cash provided by operating activities for the six months ended June 30, 2026 and 2025 was $16.2 million and $14.4 million, respectively. The change in cash from operations reflects our net loss adjusted for noncash items, such as stock-based compensation, depreciation and amortization, amortization of deferred contract costs, amortization of operating lease right-of-use assets, equity in losses of equity method investees, as well as 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.

Current wording

Net cash provided by operating activities for the nine months ended September 30, 2026 and 2025 was $17.0 million and $11.5 million, respectively. The change in cash from operations reflects our net loss adjusted for noncash items, such as stock-based compensation, depreciation and amortization, amortization of deferred contract costs, amortization of operating lease right-of-use assets, equity in losses of equity method investees, as well as 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 six months ended June 30, 2026 was $1.1 million, which was primarily due to the maturities of marketable securities of $8.0 million, offset by $5.0 million used in the purchase of marketable securities and $1.9 million in additions to property and equipment, primarily related to capitalized internal-use software development costs.

Current wording

Net cash used in investing activities during the nine months ended September 30, 2026 was $1.6 million. This was primarily driven by $6.9 million used for the purchase of marketable securities and $2.7 million in additions to property and equipment, primarily related to capitalized internal-use software development costs, partially offset by $8.0 million of proceeds from maturities of marketable securities.

Previous wording

Net cash used in investing activities during the six months ended June 30, 2025 was $7.1 million, which was primarily due to maturities of marketable securities of $27.7 million and sales of marketable securities of $0.9 million, offset by $23.7 million used in the purchase of marketable securities, $7.9 million in additions to property and equipment related to capitalized internal-use software development costs and $4.0 million investment in non-marketable equity securities.

Current wording

Net cash provided by investing activities during the nine months ended September 30, 2025 was $20.5 million, which was primarily due to maturities of marketable securities of $44.2 million and sales of marketable securities of $20.8 million, offset by $30.5 million used in the purchase of marketable securities, $10.0 million in additions to property and equipment related to capitalized internal-use software development costs and $4.0 million investment in non-marketable equity securities.

Previous wording

Net cash used in financing activities for the six months ended June 30, 2026 was $39.2 million, primarily consisting of $37.2 million related to share repurchases and $2.1 million of taxes paid related to net share settlement of equity awards, offset by $0.1 million proceeds from the exercises of stock options.

Current wording

Net cash used in financing activities for the nine months ended September 30, 2026 was $40.5 million, primarily consisting of $37.2 million related to share repurchases and $3.3 million of taxes paid related to net share settlement of equity awards, offset by $0.1 million proceeds from the exercises of stock options.

Previous wording

Net cash used in financing activities for the six months ended June 30, 2025 was $8.8 million, which was primarily due to $5.5 million of taxes paid related to net share settlement of equity awards and $4.1 million related to share repurchases, offset by $0.8 million proceeds from the exercises of stock options.

Current wording

Net cash used in financing activities for the nine months ended September 30, 2025 was $15.0 million, which was primarily due to $9.1 million related to share repurchases and $7.4 million of taxes paid related to net share settlement of equity awards, offset by $1.5 million proceeds from the exercises of stock options.