Blend reports stronger Q2 results on software growth

Blend Labs on Thursday reported higher second-quarter revenue and a narrower operating loss, driven by growth in its software platform business as the digital mortgage technology provider expanded customer relationships and rolled out its new AI-powered Autopilot product.

The San Francisco-based company posted second-quarter revenue of $33.8 million, up 7% from a year earlier and higher than its Q1 2026 figure of $30.8 million. Software platform revenue increased 7% to $31.4 million, while professional services revenue rose to $2.4 million, up from $2.2 million.

Blend reported a GAAP operating loss of $1.6 million, improving from a $4.8 million loss in the second quarter of 2025. Non-GAAP operating income increased to $7 million from $4.6 million a year earlier, while the company’s non-GAAP gross margin improved to 78% from 76%. It ended the quarter with $44.9 million in cash, cash equivalents and marketable securities with no debt.

“We delivered the quarter we aimed for — revenue near the high end, profitability above the high end and a strategic return of capital through our share buyback,” said Jason Ream, Blend’s head of finance and administration.

Autopilot, Blend 3.0 impacts

Blend’s GAAP diluted net loss from continuing operations attributable to common stockholders remained unchanged at 3 cents per share from a year earlier. On a non-GAAP basis, diluted net income from continuing operations was break-even, unchanged from the second quarter of 2025.

Nima Ghamsari, the co-founder and head of Blend, characterized the quarter as a “disciplined, profitable” one. He started the earnings call by showcasing data points regarding Autopilot and Blend 3.0, described as “the agents we are building inside Blend to help us do our work to serve our customers faster, better and cheaper.”

“Blend 3.0 is an agentic-first company, and that doesn’t mean just for our products. That also means how we work internally,” he said. Ghamsari told investors that the engineering team’s throughput has increased 3.6x since January with roughly the same headcount, as agents take a first pass on work such as code changes.

“If we continue at this pace, we could be doing 10 times as much throughput on the engineering team by the end of this year as what we did at the end of last year,” he said.

Regarding relationships, the company said it added or expanded 14 customer contracts during the quarter, including six deals involving its Autopilot platform, which became commercially available on July 1. Blend also repurchased 11 million shares for $18.2 million during the quarter, leaving $13.2 million available under its existing share repurchase authorization at quarter’s end.

“We delivered Q2 with revenue near the high end and non-GAAP operating income above the high end of our guidance, and we did it in a market that isn’t giving us much help,” Ghamsari said in a statement. 

Weathering the rate environment

Ghamsari said during the call that six lenders have already signed on to use Autopilot as of July 1, including Onity Mortgage Corp. He estimated that on a per-loan basis, Autopilot is automating an average of four and a half hours of fulfillment tasks.

“We’re starting to see evidence [that] Autopilot is driving faster clearance times, higher conversion rates, and potentially reducing fulfillment costs,” he said. “Based on our preliminary data of these loans that have gone through our system, our customers are seeing a 10% to 15% improvement in pull-through rates and two to four days of cycle-time improvement.”

Looking ahead, Blend forecasts third-quarter revenue of $31.5 million to $33.5 million, with non-GAAP operating income ranging from $3.5 million to $4.5 million.

As for the fourth quarter, Blend is taking a more conservative view on total mortgage volumes, citing skepticism about refinance growth in a “higher for longer” rate environment. The company expects Q4 market volumes to drop about 11% year over year at the midpoint and for Blend’s funded loan volumes to be down 10% to 15%, subject to change due to the fluid macro environment, Ream said.