UWM Holdings Corp Reports 32.9% Increase in Loan Production, Net Income Plummets 89.4% in Latest Quarter

UWM Holdings Corp, the largest residential mortgage lender in the U.S. by closed loan volume, reported significant financial changes in its latest 10-Q filing for the quarter ending September 30, 2024. The company experienced a notable increase in loan production, with originated loans totaling $39.5 billion, a 32.9% rise from $29.7 billion in the same period of 2023. However, total revenue for the quarter decreased to $526.4 million, down from $677.1 million year-over-year.

The company's loan production income surged to $465.5 million, compared to $288.9 million in the prior year, driven by higher refinance volumes attributed to lower market interest rates. Despite this, UWM's net income for the quarter plummeted to $31.9 million, a decrease of 89.4% from $301.0 million in Q3 2023. The net income attributable to UWM Holdings Corporation was a loss of $6.3 million, contrasting with a profit of $18.2 million in the same quarter last year.

For the nine months ended September 30, 2024, UWM reported net income of $288.8 million, down from $391.2 million in the previous year. The adjusted EBITDA for the nine-month period also declined to $341.8 million from $378.7 million. The company’s total assets increased significantly to $15.1 billion, up from $11.9 billion at the end of 2023, primarily due to a rise in mortgage loans at fair value, which reached $10.1 billion.

Total liabilities rose to $12.9 billion, compared to $9.4 billion at the end of 2023, while total equity decreased to $2.2 billion from $2.5 billion. The increase in liabilities was largely driven by warehouse lines of credit, which expanded to $9.2 billion from $4.9 billion.

UWM's operational expenses also saw a substantial increase, totaling $494.1 million for the quarter, up from $375.4 million in the previous year. This rise was attributed to higher salaries, commissions, and direct loan production costs. The company reported a significant net cash outflow from operating activities of $5.7 billion for the nine months ended September 30, 2024, compared to a cash inflow of $494.5 million in the same period of 2023.

Strategically, UWM amended its agreements with Citibank to increase its total uncommitted borrowing capacity to $2.0 billion, maturing in June 2026. The company also declared a cash dividend of $0.10 per share on Class A common stock, payable in January 2025.