BLND

MKT CAP $276.7MP/E —DIV YIELD —FCF YIELD 2.73%REV TTM $129M +6.0%NET INCOME −$4.3MNET CASH $23.3M52W 0.90 – 3.56NEXT EARNINGS Nov 5SEC XBRL · TTM TO Invalid Date

How BLND rewrote its risk factors

10-K ITEM 1A · FY2024 → FY2025

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Risk Factors Summary The risks and uncertainties to which our business is subject include, but are not limited to, the following: • Our business is substantially dependent on revenue from the financial services industry and is therefore subject to risks impacting the mortgage industry and the larger financial services industry; • Increases in market interest rates have, and will likely continue to, adversely affect our business, financial condition, and results of operations; • Unfavorable conditions in our industry or the global economy or reductions in technology spending could limit our ability to grow our business and adversely affect our financial conditions and results of operations; • We have a history of net losses, and we may not be able to achieve or maintain profitability in the future; • A large percentage of our revenue is concentrated with a small number of key customers, and if our relationships with any of these key customers were to be terminated or the level of business with them significantly reduced over time, our business, financial condition, results of operations, and future prospects would be adversely affected; • If we fail to retain our existing customers or to acquire new customers in a cost-effective manner, or if our customers fail to maintain their utilization of our products and services, our revenue may decrease and our business, financial condition, and results of operations could be adversely affected; • We face intense competition, and if we are unable to compete effectively, our business, financial condition, and results of operations could be adversely affected; • We have a limited operating history in an evolving industry, and have experienced fluctuating growth rates in recent periods, which makes it difficult to evaluate our future prospects and may increase the risk that we will not be successful; • Our business, financial condition, and results of operations depend on our ability to adapt to technological change as well as global trends in the way customers access cloud-based banking software and successfully introduce new and enhanced products, services and business models; • Our results of operations have fluctuated from period to period, which has caused the market price of our Class A common stock to fluctuate; • We often rely on self-reporting of completed transactions by our customers due to our primarily success-based model, which can make it difficult to estimate and forecast revenue; • We have in the past, and may in the future, make strategic acquisitions or dispositions or we may enter into partnerships, strategic collaborations, joint ventures or licensing agreements and investments, and we face risks related to execution and the integration of such acquisitions or dispositions or investments and the management of any associated growth; • The impairment of intangible assets, goodwill, and other assets arising from any future acquisitions or investments may have an adverse effect on our business, financial condition, and results of operations; • A cyberattack, security breach or incident affecting us or the third parties we rely on or partner with could expose us or our customers and consumers to a risk of loss or misuse of confidential information and have an adverse effect on our reputation, brand, business, financial condition, and results of operations; • We may require additional capital to support business growth, and this capital might not be available on acceptable terms, if at all; • We have identified two material weaknesses in our internal control over financial reporting and may identify additional material weaknesses in the future or otherwise fail to maintain an effective system of internal controls, which may result in material misstatements of our consolidated financial statements or cause us to fail to meet our periodic reporting obligations; • We may be subject to claims, lawsuits, government investigations, and other proceedings that may adversely affect our business, financial condition, and results of operations; • Our customers are, and in some cases we are or may be, subject to, and we facilitate compliance with, a variety of federal, state, and local laws, including those related to consumer protection and financial services; • We depend on the interoperability of our platform across third-party applications and services that we do not control; • Failure to adequately protect our intellectual property could adversely affect our business, financial condition, and results of operations; • The trading price of our Class A common stock may be volatile, and you could lose all or part of your investment; and • The multi-class structure of our common stock has the effect of concentrating voting power with Nima Ghamsari, Head of Blend, Co-Founder, and Chair of our board of directors, which will severely limit your ability to influence or direct the outcome of matters submitted to our stockholders for approval, including the election of our board of directors, the adoption of amendments to our certificate of incorporation (the “Amended and Restated Certificate of Incorporation”) and amended and restated bylaws, and the approval of any merger, consolidation, sale of all or substantially all of our assets or other major corporate transaction; • The holders of our Series A Preferred Stock will be entitled to vote on an as-converted to Class A common stock basis and have rights to approve certain actions.
To the extent our financial services customers or potential customers fail or experience further downturns due to challenges in the general macroeconomic environment, including as a result of increased tariffs, adverse impacts on trade relations, an economic downturn in the U.S. or globally, or adverse conditions in the financial or credit markets, these firms may decrease the amount of money they spend with us, or stop spending with us entirely.
The number of mortgage loans and refinances has been and may continue to be affected by negative trends in the general economy in the United States and abroad, including conditions resulting from changes in gross domestic product, financial and credit market fluctuations, the potential recessionary environment and macroeconomic uncertainty, including as a result of increased tariffs, adverse impacts on trade relations, an economic downturn in the U.S. or globally, increased interest rates, the availability and cost of credit, reductions in business and consumer confidence, stock market volatility, increased unemployment, political turmoil, pandemics, natural catastrophes, warfare, such as ongoing global conflicts and the potential effects of sanctions, and terrorist attacks on the United States, Europe, the Middle East region, the Asia Pacific region or elsewhere, and any such decrease in mortgage origination volumes is likely to have an adverse impact on our business.
While, more recently, the Federal Reserve has lowered the federal funds rate significantly, any further actions by the Federal Reserve or consumers are speculative and difficult to predict with certainty.
Further notwithstanding any improvement in interest rates, we have experienced in the past, and may continue to experience in the future, a reduction in the volume of transactions enabled through our platform.
Negative conditions in the general economy in the United States and abroad, including conditions resulting from changes in gross domestic product growth, financial and credit market fluctuations, the potential recessionary environment and macroeconomic uncertainty, including as a result of increased tariffs and other adverse impacts on trade relations, increased interest rates, the availability and cost of credit, reductions in business and consumer confidence, stock market volatility, increased unemployment, political turmoil, pandemics, natural catastrophes, warfare, such as ongoing global conflicts and the potential effects of sanctions, and terrorist attacks on the United States, Europe, the Middle East region, the Asia Pacific region or elsewhere, has caused and could further cause a decrease in lending activity and business investments, including spending on technology, and as a result, negatively affect the growth of our business.
As of December 31, 2025, we had an accumulated deficit of $1,391.8 million.
For 2025, our top five customers accounted for 39% of revenue, and as of December 31, 2025, we had 25 customers generating more than $1 million in annual revenue, which represented 75% of revenue in 2025.
Further, our customers may engage in mergers, acquisitions or consolidations with each other, our competitors or with third parties, any of which could be disruptive to our existing and prospective relationships with our customers and could adversely affect our revenue.
The market in which we operate is intensely competitive and characterized, dependent on continued acceleration in digital technology, by shifting user preferences, fragmentation, and frequent introductions of new services and offerings.
Greater financial resources and product development capabilities, particularly in a fluctuating macroeconomic environment, may allow these competitors to respond more quickly to new or emerging technologies and changes in financial services firm preferences that may render our platform less attractive or obsolete.
These risks and difficulties include our ability to: • accurately forecast the impact of macroeconomic or other external factors on our business, including the timing and extent of such impacts; • accurately forecast our revenue and plan or adjust our operating expenses in light of fluctuations in our revenue; • accurately forecast the timing of anticipated acceleration in digital technology in the industries in which we operate; • appropriately adjust our operating expenses in line with our revenue and that adequately supports our operations and future growth; • develop a scalable, high-performance technology infrastructure that can efficiently and reliably handle increased usage, as well as the deployment of new features and services; • maintain and increase the volume of transactions enabled through our platform; • enter into new and maintain existing customer relationships; • successfully identify, negotiate, execute, and integrate acquisitions or partnerships; • successfully compete with current and future competitors; • successfully build our brand and protect our reputation from negative publicity; • increase the effectiveness of our marketing strategies; • successfully adjust our proprietary technology, products, and services in a timely manner in response to changing macroeconomic conditions and fluctuations in the credit market; • enter into new and maintain existing ecosystem partnerships; • successfully introduce and integrate new products and services and enter new markets and geographies; • adapt to rapidly evolving trends in the ways customers and consumers interact with technology; • comply with and successfully adapt to complex and evolving regulatory environments; • protect against fraud and online theft; • avoid interruptions or disruptions in our service; • effectively secure and maintain the confidentiality of the information received, accessed, stored, provided, and used across our systems; • successfully obtain and maintain funding and liquidity to support continued growth and general corporate purposes; • attract, integrate, and retain qualified employees; and • effectively manage growth in our personnel and operations.
Numerous factors can influence our results of operations, including: • our ability to attract and retain customers in a cost-effective manner; • our ability to maintain or increase loan volumes, transactions processed, platform utilization, and improve loan mix; • our ability to successfully expand in existing markets and successfully enter new markets; • changes in financial services firm behavior with respect to cloud-based software products and solutions; • the amount and timing of operating expenses related to maintaining and expanding our business, operations, and infrastructure, including acquiring new and maintaining existing customers; • our restructuring actions and the timing of incurring expenses and cash expenditures related to such actions; • our ability to successfully identify, negotiate, execute, and integrate strategic acquisitions or partnerships; • the mix of revenue we generate from our products and our marketplace; • the timing and success of new products and services; • the impact of worldwide economic conditions, including economic slowdowns as a result of the imposition of tariffs or other impacts on trade relations, changes in market interest rates, recessions, housing affordability, and tightening of credit markets, including due to ongoing global conflict and war; • the seasonality of our business; • our ability to maintain an adequate rate of growth and effectively manage that growth; • our ability to keep pace with technology changes in our industry; • the success of our sales and marketing efforts; • the effects of negative publicity on our business, reputation, or brand; • our ability to protect, maintain, and enforce our intellectual property; • costs associated with defending claims, including intellectual property infringement claims, and related judgments or settlements; • changes in governmental or other regulations, including state and federal banking laws and regulations or in federal monetary policies, affecting our business; • interruptions in service and any related impact on our business, reputation, or brand; • the attraction, retention and engagement of qualified employees and key personnel; • our ability to choose and effectively manage partners, vendors, and other service providers; • the effects of natural or man-made catastrophic events; • the effectiveness of our internal control over financial reporting; and • changes in our tax rates or exposure to additional tax liabilities.
For example, in 2024, we entered into a strategic partnership with Covered Insurance Solutions, and in March 2026, we completed the sale of substantially all the assets and liabilities of our title insurance business to Covius Services, LLC (the “Purchaser”).
Such transactions may also require additional management resources to integrate more significant and often more complex businesses into our company and restructure operations.
During the pendency of a divestiture, we may be subject to risks related to a decline in the business, loss of employees, customers, or suppliers, and that the transaction may not close, which could have a material and adverse effect on the business to be divested and on us.
Additionally, following completion of an acquisition, we may still be subject to certain liabilities in connection with any such transaction.
For example, in connection with our completed sale of substantially all the assets and liabilities of our title insurance business to the Purchaser, we may be required to indemnify the Purchaser for certain liabilities, which may be greater than we expect and may require significant management time and attention.
Further, whether such a strategic transaction is ultimately consummated or not, its pendency could have a number of negative effects on our current business, including potentially disrupting our regular operations, increasing our near-term costs, diverting the attention of our workforce and management team and increasing undesired workforce turnover.
It could also disrupt existing business relationships, make it harder to develop new business relationships, or otherwise negatively impact the way that we operate our business.
Our systems and those of our third-party service providers are vulnerable to and have been, and may be subject to unintentional, inadvertent, or malicious, internal and external cyberattacks and other means of compromising the security, integrity, or availability of systems and data, including hacking, intrusions, malware, ransomware and other malicious code, social engineering attacks, phishing and spearphishing attempts, fraudulent inducement, electronic fraud (including attempts to misrepresent personal or financial or information to obtain loans or other financial products), wire fraud attempts to overload our servers with distributed denial-of-service attacks, employee theft, error, or malfeasance, unauthorized access by third parties (including foreign governments or state actors with significant financial and technological resources) or internal actors, or other attacks, and other types of disruptions, exposure, and security breaches and incidents.
Additionally, these risks may be elevated in connection with geopolitical events.
For example, in connection with the audit of our consolidated financial statements as of and for the year ended December 31, 2025, we identified two material weaknesses in our internal control over financial reporting.
Our failure to implement and maintain effective internal control over financial reporting or remediate the material weaknesses in a timely manner could result in errors in our consolidated financial statements that could result in a restatement of our financial statements and could cause us to fail to meet our reporting obligations, any of which could diminish investor confidence in us and could cause a decline in the price of our Class A common stock.
Although macroeconomic factors, including an unfavorable interest rate environment, decreased housing affordability, and uncertain worldwide political and economic conditions, including concerns about a potential recessionary environment, adverse impacts from trade regulation and consumer confidence, has made, and may continue to make, seasonal fluctuations difficult to detect, our business is highly dependent on consumer borrowing patterns that have an impact on our results of operations.
We may also discover unexpected errors in the data that we are using that resulted from technical or other errors, or we may determine that third party data we relied upon is not accurate or does not accurately reflect our business.
Our industry has been experiencing an increasing number of fraudulent activities by third parties, and those fraudulent activities are becoming increasingly sophisticated.
Although we do not believe that any of this activity is uniquely targeted at our platform or business, this type of fraudulent activity may adversely affect us.
From time to time, we have engaged in debt financings and we may engage in debt transactions in the future.
We have identified two material weaknesses in our internal control over financial reporting and may identify additional material weaknesses in the future or otherwise fail to maintain an effective system of internal controls, which may result in material misstatements of our consolidated financial statements or cause us to fail to meet our periodic reporting obligations.
In connection with the audit of our consolidated financial statements as of and for the year ended December 31, 2025, we identified two material weaknesses in our internal controls over financial reporting related to (i) the completeness and accuracy of data flows used to record revenue and (ii) information technology (“IT”) general controls for certain information systems that support our revenue and related financial reporting processes that are relevant to the preparation of our financial statements and the effectiveness of IT-dependent controls.
See “Item 9.A–Controls and Procedures in this Annual Report on Form 10-K.” A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.
We are taking measures to remediate the material weaknesses.
With respect to the completeness and accuracy of data flows used to record revenue, we are designing and implementing procedures to ensure the completeness and accuracy of revenue data flows and automated data transformations, the accuracy of pricing, and the accuracy of customer order information used in revenue recognition.
With respect to the IT general controls over information systems in our revenue process, we are designing and implementing more rigorous controls over user access reviews and program change management controls, as well as the monitoring of data processing and transfer.
Although we believe these measures will remediate the material weaknesses, there can be no assurance that the material weaknesses will be remediated on a timely basis or at all, or that additional material weaknesses will not be identified in the future.
If we are unable to remediate the material weaknesses, or if we experience additional material weaknesses, our ability to record, process, and report financial information accurately, and to prepare financial statements within the time periods specified by the rules of the SEC, could be adversely affected which, in turn, may adversely affect our reputation and business and the market price of our Class A common stock.
If any of these new or improved controls and systems does not perform as expected, we may experience material weaknesses in our controls.
In this regard, in connection with the audit of our consolidated financial statements as of and for the year ended December 31, 2025, we identified two material weaknesses in our internal control over financial reporting.
See “ We have identified two material weaknesses in our internal control over financial reporting and may identify additional material weaknesses in the future or otherwise fail to maintain an effective system of internal controls, which may result in material misstatements of our consolidated financial statements or cause us to fail to meet our periodic reporting obligations. ” Our internal resources and personnel may in the future be insufficient to avoid accounting errors, and there can be no assurance that we will not have additional material weaknesses in the future.

and 30 more.

Gone since FY2024

Risk Factors Summary The risks and uncertainties to which our business is subject include, but are not limited to, the following: • Our business is substantially dependent on revenue from the financial services industry and is therefore subject to risks impacting the mortgage industry and the larger financial services industry; • Increases in market interest rates have, and will likely continue to, adversely affect our business, financial condition, and results of operations; • Unfavorable conditions in our industry or the global economy or reductions in technology spending could limit our ability to grow our business and adversely affect our financial conditions and results of operations; • We have a history of net losses, and we may not be able to achieve or maintain profitability in the future; • A large percentage of our revenue is concentrated with a small number of key customers, and if our relationships with any of these key customers were to be terminated or the level of business with them significantly reduced over time, our business, financial condition, results of operations, and future prospects would be adversely affected; • If we fail to retain our existing customers or to acquire new customers in a cost-effective manner, or if our customers fail to maintain their utilization of our products and services, our revenue may decrease and our business, financial condition, and results of operations could be adversely affected; • We face intense competition, and if we are unable to compete effectively, our business, financial condition, and results of operations could be adversely affected; • We have a limited operating history in an evolving industry, and have experienced fluctuating growth rates in recent periods, which makes it difficult to evaluate our future prospects and may increase the risk that we will not be successful; • Our business, financial condition, and results of operations depend on our ability to adapt to technological change as well as global trends in the way customers access cloud-based banking software and successfully introduce new and enhanced products, services and business models; • Our results of operations have fluctuated from period to period, which has caused the market price of our Class A common stock to fluctuate; • We often rely on self-reporting of completed transactions by our customers due to our primarily success-based model, which can make it difficult to estimate and forecast revenue; • We have in the past, and may in the future, make strategic acquisitions or dispositions or we may enter into partnerships, strategic collaborations, joint ventures or licensing agreements and investments, and we face risks related to execution and the integration of such acquisitions or dispositions or investments and the management of any associated growth; • The impairment of intangible assets, goodwill, and other assets arising from any future acquisitions or investments may have an adverse effect on our business, financial condition, and results of operations; • We may require additional capital to support business growth, and this capital might not be available on acceptable terms, if at all; • A cyberattack, security breach or incident affecting us or the third parties we rely on or partner with could expose us or our customers and consumers to a risk of loss or misuse of confidential information and have an adverse effect on our reputation, brand, business, financial condition, and results of operations; • We may be subject to claims, lawsuits, government investigations, and other proceedings that may adversely affect our business, financial condition, and results of operations; • Our customers are, and in some cases we are or may be, subject to, and we facilitate compliance with, a variety of federal, state, and local laws, including those related to consumer protection and financial services; • We depend on the interoperability of our platform across third-party applications and services that we do not control; • Failure to adequately protect our intellectual property could adversely affect our business, financial condition, and results of operations; • The trading price of our Class A common stock may be volatile, and you could lose all or part of your investment; and • The multi-class structure of our common stock has the effect of concentrating voting power with Nima Ghamsari, Head of Blend, Co-Founder, and Chair of our board of directors, which will severely limit your ability to influence or direct the outcome of matters submitted to our stockholders for approval, including the election of our board of directors, the adoption of amendments to our certificate of incorporation (the “Amended and Restated Certificate of Incorporation”) and amended and restated bylaws, and the approval of any merger, consolidation, sale of all or substantially all of our assets or other major corporate transaction; • The holders of our Series A Preferred Stock will be entitled to vote on an as-converted to Class A common stock basis and have rights to approve certain actions.
To the extent our financial services customers or potential customers fail or experience further downturns due to challenges in the general macroeconomic environment or adverse conditions in the financial or credit markets, these firms may decrease the amount of money they spend with us, or stop spending with us entirely.
Increases 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 2023 from 2022.
The number of mortgage loans and refinances has been and may continue to be affected by negative trends in the general economy in the United States and abroad, including conditions resulting from changes in gross domestic product, financial and credit market fluctuations, the potential recessionary environment and macroeconomic uncertainty, increased interest rates, the availability and cost of credit, reductions in business and consumer confidence, stock market volatility, increased unemployment, political turmoil, pandemics, natural catastrophes, warfare, such as the current war in Ukraine and the potential effects of sanctions, the current conflict in the Middle East, and terrorist attacks on the United States, Europe, the Middle East region, the Asia Pacific region or elsewhere, and any such decrease in mortgage origination volumes is likely to have an adverse impact on our business.
While in 2024, the Federal Reserve lowered the federal funds rate by 75 basis points, easing monetary policy for the first time in four years, any further actions by the Federal Reserve or consumers are speculative and difficult to predict with certainty.
Further notwithstanding any improvement in interest rates, we have experienced in the past, and may continue to experience in the future, a reduction in the volume of transactions enabled through our platform and the value of title orders processed.
Negative conditions in the general economy in the United States and abroad, including conditions resulting from changes in gross domestic product growth, financial and credit market fluctuations, the potential recessionary environment and macroeconomic uncertainty, increased interest rates, the availability and cost of credit, reductions in business and consumer confidence, stock market volatility, increased unemployment, political turmoil, pandemics, natural catastrophes, warfare, such as the current war in Ukraine and the potential effects of sanctions, the current conflict in the Middle East, and terrorist attacks on the United States, Europe, the Middle East region, the Asia Pacific region or elsewhere, has caused and could further cause a decrease in lending activity and business investments, including spending on technology, and as a result, negatively affect the growth of our business.
As of December 31, 2024, we had an accumulated deficit of $1,385.0 million.
For 2024, our top five customers in the Blend Platform segment accounted for 33.0% of the segment revenue, and as of December 31, 2024, we had 23 customers in the Blend Platform segment generating more than $1 million in annual revenue, which represented 62.8% of the segment revenue in 2024.
Additionally, we rely on certain of our customers, including Mr.
Cooper, for a significant portion of our title transaction volumes.
For example, for 2024, our top five customers in the Title segment accounted for 73.2% of the segment revenue, with Mr.
Cooper accounting for 46.8% of the segment revenue.
As of December 31, 2024, we had 7 customers in the Title segment generating more than $1 million in annual revenue, which represented 79.4% of the segment revenue in 2024.
We have experienced lower than anticipated title transaction volume since the closing of our Title365 acquisition and may experience further reductions in the future.
Reductions in title transaction volume from any such customers, or a deterioration in or termination of our relationship with any such customers, would likely have a significant impact on our title business.
The market in which we operate is intensely competitive and characterized by shifting user preferences, fragmentation, and frequent introductions of new services and offerings.
Greater financial resources and product development capabilities may allow these competitors to respond more quickly to new or emerging technologies and changes in financial services firm preferences that may render our platform less attractive or obsolete.
These risks and difficulties include our ability to: • accurately forecast the impact of macroeconomic or other external factors on our business, including the timing and extent of such impacts; • accurately forecast our revenue and plan or adjust our operating expenses in light of fluctuations in our revenue; • appropriately adjust our operating expenses in line with our revenue and that adequately supports our operations and future growth; • develop a scalable, high-performance technology infrastructure that can efficiently and reliably handle increased usage, as well as the deployment of new features and services; • maintain and increase the volume of transactions enabled through our platform; • enter into new and maintain existing customer relationships; • successfully identify, negotiate, execute, and integrate acquisitions or partnerships; • successfully compete with current and future competitors; • successfully build our brand and protect our reputation from negative publicity; • increase the effectiveness of our marketing strategies; • successfully adjust our proprietary technology, products, and services in a timely manner in response to changing macroeconomic conditions and fluctuations in the credit market; • enter into new and maintain existing ecosystem partnerships; • successfully introduce and integrate new products and services and enter new markets and geographies; • adapt to rapidly evolving trends in the ways customers and consumers interact with technology; • comply with and successfully adapt to complex and evolving regulatory environments; • protect against fraud and online theft; • avoid interruptions or disruptions in our service; • effectively secure and maintain the confidentiality of the information received, accessed, stored, provided, and used across our systems; • successfully obtain and maintain funding and liquidity to support continued growth and general corporate purposes; • attract, integrate, and retain qualified employees; and • effectively manage growth in our personnel and operations.
Numerous factors can influence our results of operations, including: • our ability to attract and retain customers in a cost-effective manner; • our ability to maintain or increase loan volumes, transactions processed, platform utilization, and title orders closed, and improve loan mix; • our ability to successfully expand in existing markets and successfully enter new markets; • changes in financial services firm behavior with respect to cloud-based software products and solutions; • the amount and timing of operating expenses related to maintaining and expanding our business, operations, and infrastructure, including acquiring new and maintaining existing customers; • our restructuring actions and the timing of incurring expenses and cash expenditures related to such actions; • our ability to successfully identify, negotiate, execute, and integrate strategic acquisitions or partnerships; • the mix of revenue we generate from our products and our marketplace; • the timing and success of new products and services; • the impact of worldwide economic conditions, including economic slowdowns, changes in market interest rates, recessions, housing affordability, and tightening of credit markets, including due to the war in Ukraine and the conflict in the Middle East; • the seasonality of our business; • our ability to maintain an adequate rate of growth and effectively manage that growth; • our ability to keep pace with technology changes in our industry; • the success of our sales and marketing efforts; • the effects of negative publicity on our business, reputation, or brand; • our ability to protect, maintain, and enforce our intellectual property; • costs associated with defending claims, including intellectual property infringement claims, and related judgments or settlements; • changes in governmental or other regulations, including state and federal banking laws and regulations or in federal monetary policies, affecting our business; • interruptions in service and any related impact on our business, reputation, or brand; • the attraction, retention and engagement of qualified employees and key personnel; • our ability to choose and effectively manage partners, vendors, and other service providers; • the effects of natural or man-made catastrophic events; • the effectiveness of our internal control over financial reporting; and • changes in our tax rates or exposure to additional tax liabilities.
For example, in 2021, we acquired Title365 and in 2024, we entered into a strategic partnership with Covered Insurance Solutions.
Such transactions may also require additional management resources to integrate more significant and often more complex businesses into our company.
In particular, failure to realize the full extent of the anticipated benefits of our acquisition of Title365 has and could continue to have an adverse effect on our revenue, level of expenses, and results of operations.
Our systems and those of our third-party service providers are potentially vulnerable to and may be subject to unintentional, inadvertent, or malicious, internal and external cyberattacks and other means of compromising the security, integrity, or availability of systems and data, including hacking, intrusions, malware, ransomware and other malicious code, social engineering attacks, phishing and spearphishing attempts, fraudulent inducement, electronic fraud (including attempts to misrepresent personal or financial or information to obtain loans or other financial products), wire fraud attempts to overload our servers with distributed denial-of-service attacks, employee theft, error, or malfeasance, unauthorized access by third parties (including foreign governments or state actors with significant financial and technological resources) or internal actors, or other attacks, and other types of disruptions, exposure, and security breaches and incidents.
Additionally, these risks may be elevated in connection with geopolitical events such as the current war in Ukraine and the conflict in the Middle East.
Our failure to implement and maintain effective internal control over financial reporting could result in errors in our consolidated financial statements that could result in a restatement of our financial statements and could cause us to fail to meet our reporting obligations, any of which could diminish investor confidence in us and could cause a decline in the price of our Class A common stock.
Although macroeconomic factors, including an unfavorable interest rate environment, decreased housing affordability, and uncertain worldwide political and economic conditions has made, and may continue to make, seasonal fluctuations difficult to detect, our business is highly dependent on consumer borrowing patterns that have an impact on our results of operations.
We may also discover unexpected errors in the data that we are using that resulted from technical or other errors, or we may determine that third party date we relied upon is not accurate or does not accurately reflect our business.
The title industry has been experiencing an increasing number of fraudulent activities by third parties, and those fraudulent activities are becoming increasingly sophisticated.
Although we do not believe that any of this activity is uniquely targeted at our platform or business, this type of fraudulent activity may adversely affect our title business.
In 2021, we also entered into a credit agreement that provides for a term facility and a revolving facility (as amended from time to time, the “Credit Agreement”).
The term facility was fully drawn at closing to provide, in part, the consideration being paid in connection with our acquisition of Title365.
In 2023, the revolving facility was terminated in connection with an amendment to the Credit Agreement and on April 29, 2024, the Credit Agreement was terminated in connection with the Haveli investment.
If any of these new or improved controls and systems does not perform as expected, we may continue to experience material weaknesses in our controls.
As a public company, we are required to comply with the SEC rules that implement Section 404 of the Sarbanes-Oxley Act.
GAAP requires our management to make estimates and assumptions that affect the amounts reported and disclosed in our consolidated financial statements and accompanying notes.
Further, there has been significant volatility and instability among banks and financial institutions in recent periods.
For example, in 2023, Silicon Valley Bank was closed by the California Department of Financial Protection and Innovation, which appointed the FDIC as receiver, and for a period of time, customers of the bank did not have access to their funds and there was uncertainty as to when, if at all, customers would have access to funds in excess of the FDIC insured amounts.
Additionally, the CPRA was approved by California voters in November 2020, and significantly modified the CCPA, including expanding California consumers’ rights with respect to certain personal information and creating a new state agency to oversee implementation and enforcement efforts.
For example, Connecticut, Virginia, Colorado, and Utah have enacted legislation similar to the CCPA and CPRA that took effect in 2023; Florida, Montana, Oregon, and Texas have enacted similar legislation that took effect in 2024; Delaware, Iowa, Maryland, Minnesota, Nebraska, New Hampshire, New Jersey, and Tennessee have enacted similar legislation that has taken or will take effect in 2025; and Indiana, Kentucky, and Rhode Island have enacted similar legislation that will take effect in 2026.

and 62 more.

Sentence-level comparison of Item 1A in the two most recent 10-Ks (FY2024 ↗, FY2025 ↗). A reworded sentence counts as one dropped and one added, so heavy edits read as low “kept”. Headings and page furniture are stripped; nothing is summarised by a model.

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