Revenue for Nationstar’s Xome — a platform that features a property search site, real estate agent referral network and title, closing, valuation and asset management services — declined to $76 million in the second quarter of 2017, according to the company’s Q2 2017 financial results.
Nationstar operated at a net loss of $20 million in the second quarter, compared to a net income of $2 million in Q1 and $198 in Q4 2016.
Xome’s revenues have been languishing for some time, from $101 million in Q1 2016 to $85 million in Q1 2017. The platform’s earnings (adjusted pretax income) rose from $13 million in the first quarter to $17 million in Q2.
Launched 2015, Nationstar Mortgage Holdings launched Xome to much fanfare, hailing it as “world’s first integrated, end-to-end digital platform for real estate, with the promise of connecting every major touch point in the transaction process, from finding a home to closing the deal.”’
In June, several sources told Inman that Nationstar was reportedly shopping the platform around to prospective buyers. In its Q1 2017 earnings call, the company discussed “evaluating” interest in the company.
Responding to a question about Xome’s “final path” from a listener who said that “the market is kind of a yawn on it” during today’s Q2 earnings call, Jay Bray, Chairman and CEO of Nationstar, said that he would “stay consistent” with the company’s message about Xome from previous quarters that Xome is “extremely valued” and “we do think it’s undervalued within the Nationstar umbrella at the moment.” He added that the company would “make the right decision for the shareholders.”
“Due to Xome’s industry leading technology and competitive product suite, the Xome segment continues to win new third-party
business,” the company said in its Q2 earnings report. “The Exchange segment continues to diversify its revenue stream with third-party business from GSEs and several large FHA loan servicers. During the quarter the Services segment gained three new valuation clients and ten new title clients, which will drive additional revenue in future quarters.”
In the second quarter, Xome sold over 3,000 properties while REO inventory remained “relatively flat quarter over quarter, driven by additional third-party inventory received late in the second quarter.”
Perhaps most importantly, said Bray, Xome’s white-label business, launched in March, has generated 1,700 new listings and 100 closings. This presents “opportunities for fee income, purchase originations and Xome downstream services.”
“Through our referral programs, homeowners selling their homes have access to Xome’s exchange platform, curated real estate agent
panel and concierge transaction support to facilitate the lending, title and overall closing experience,” the company said.
Nationstar also confirmed that it is on track to continue its branding overhaul to “Mr. Cooper” — which represents “not just a name change” but the company’s dedication to serving customers on their homeownership journey.