UWM Holdings Corporation Announces Fourth Quarter & Full Year 2023 Results

Rhea-AI Summary

UWM Holdings Corporation (NYSE: UWMC) reported a strong fourth quarter with a loan origination volume of $24.4 billion, including $20.7 billion in purchase volume. The company experienced a net loss of $461.0 million for 4Q23, mainly due to a decline in fair value of MSRs. Despite the financial loss, UWM remains operationally profitable and aims to invest in people, products, and technology for future growth.

Positive

• Strong loan origination volume of $24.4 billion in 4Q23, with $20.7 billion in purchase volume
• Net loss of $461.0 million in 4Q23, driven by a decline in fair value of MSRs
• Company maintains operational profitability despite financial loss
• Focus on investing in people, products, and technology for future growth
• Record purchase originations of $93.9 billion in full year 2023

Negative

• Net loss of $69.8 million for full year 2023
• Decline in fair value of MSRs impacting financial results
• Decrease in total equity from $3.1 billion in 3Q23 to $2.5 billion in 4Q23
• Reduction in available liquidity from $2.9 billion in 3Q23 to $2.2 billion in 4Q23

Insights

Financial Analyst

The reported net loss of $461.0 million in the fourth quarter by UWM Holdings Corporation, including a significant markdown in the fair value of Mortgage Servicing Rights (MSRs), indicates potential volatility in the company's financial health. The decline in MSRs' value is primarily attributed to interest rate movements, which tend to inversely affect the valuation of these assets. It's important to note that MSRs are rights to service mortgages in exchange for a fee and their value can fluctuate with changes in interest rates and prepayment speeds. The reported total loan origination volume shows a decrease from the previous quarter and year-over-year, which may raise concerns about the company's growth trajectory in a competitive mortgage lending market.

Furthermore, the company's total gain margin of 92 basis points (bps) for the fourth quarter, although higher than the same quarter of the previous year, has decreased from the previous quarter, suggesting margin compression. This metric, which represents total loan production income divided by loan origination volume, is a critical indicator of the profitability per loan and can impact the company's overall financial performance. The provided outlook for the first quarter of 2024, with an anticipated production range of $22 to $28 billion and gain margin from 80 to 105 bps, suggests that the company is expecting a similar performance in the near term. The consistency of the dividend payout could be seen as a positive signal to investors regarding the company's commitment to shareholder returns despite the net loss.

Market Research Analyst

The mortgage industry is highly sensitive to interest rate fluctuations and UWM Holdings Corporation's performance reflects this with a substantial impact on their MSRs. The company's focus on purchase originations, which accounted for the majority of its loan volume, demonstrates a strategic emphasis on the home purchase market rather than refinancing, which can be more interest rate-sensitive. This is evident from the record purchase originations reported for the full year of 2023. The company's position as the number one mortgage originator in America, according to the CEO, could help maintain its market share despite the challenging environment.

UWM's technological advancements and product launches, such as the Memory Maker tool and enhancements to Investor Flex, indicate an investment in innovation to enhance customer experience and operational efficiency. These initiatives could play a crucial role in differentiating UWM in the competitive mortgage lending space and securing future business. The reported Net Promoter Score of +86.5, which is a measure of customer loyalty, suggests strong customer satisfaction that could lead to repeat business and referrals, which are vital in the mortgage industry.

Economist

The mortgage market is influenced by broader economic conditions, particularly interest rates and housing market trends. UWM Holdings Corporation's significant net loss, driven by the markdown in MSRs, reflects the broader impact of rising interest rates on financial assets. The Federal Reserve's monetary policy, aimed at controlling inflation, has led to increased borrowing costs, which in turn can reduce demand for mortgage originations and put pressure on lenders' gain margins.

The company's strategic decision to focus on purchase volume over refinancing could be a response to the anticipated slowdown in refinancing activities due to higher rates. This shift in strategy may help to stabilize revenue streams, as purchase originations are less sensitive to interest rate increases compared to refinancing. Additionally, the company's low delinquency rate compared to the industry average suggests strong underwriting standards and a healthy loan portfolio, which is critical for long-term financial stability in a rising rate environment.

Fourth Quarter Loan Origination Volume of $24.4 Billion, Including Purchase Volume of $20.7 Billion.

PONTIAC, Mich.--(BUSINESS WIRE)-- UWM Holdings Corporation (NYSE: UWMC) (the "Company"), the publicly traded indirect parent of United Wholesale Mortgage (“UWM”), today announced its results for the fourth quarter and full year ended December 31, 2023. Total loan origination volume for the fourth quarter 2023 was $24.4 billion, of which $20.7 billion was purchase volume. Total loan originations for full year 2023 were $108.3 billion, of which $93.9 billion was purchase volume. The Company reported 4Q23 net loss of $461.0 million, inclusive of a $634.4 million decline in fair value of MSRs, and diluted loss per share of $0.29. The Company reported full year 2023 loss of $69.8 million, inclusive of a $854.1 million decline in fair value of MSRs, and diluted loss per share of $0.14.

Mat Ishbia, Chairman and CEO of UWMC, said, "2023 was one of the best years in our company history. We were the number one mortgage originator in America, number one in purchase origination again, and, nine years running, the number one wholesale lender. We continue to be operationally profitable, the true measure of a mortgage originator's health, while our financial loss was driven by the MSR markdown which is a result of interest rate movements. Our recipe for success has not and will not change and we are currently doubling down on investing in our people, our products and our technology so that we can continue to provide the broker channel with the tools needed to win. I believe that 2024 is a tremendous opportunity for both UWM and the broker channel."

Fourth Quarter 2023 Highlights

• Originations of $24.4 billion in 4Q23, compared to $29.7 billion in 3Q23 and $25.1 billion in 4Q22
• Purchase originations of $20.7 billion in 4Q23, compared to $25.9 billion in 3Q23 and $21.7 billion in 4Q22
• Total gain margin of 92 bps in 4Q23 compared to 97 bps in 3Q23 and 51 bps in 4Q22
• Net loss of $461.0 million in 4Q23 compared to net income of $301.0 million in 3Q23 and net loss of $62.5 million 4Q22
• Adjusted EBITDA of $99.6 million in 4Q23 compared to $112.1 million in 3Q23 and $60.4 million in 4Q22
• Total equity of $2.5 billion at December 31, 2023, compared to $3.1 billion at September 30, 2023, and $3.2 billion at December 31, 2022
• Unpaid principal balance of MSRs of $299.5 billion with a WAC of 4.43% at December 31, 2023, compared to $281.4 billion with a WAC of 4.20% at September 30, 2023, and $312.5 billion with a WAC of 3.64% at December 31, 2022
• Ended 4Q23 with approximately $2.2 billion of available liquidity, including $497.5 million of cash, and $1.75 billion of available borrowing capacity, which includes $1.25 billion under lines of credit secured by agency and Ginnie Mae MSRs, and $500 million under an unsecured line of credit

Full Year 2023 Highlights

• Originations of $108.3 billion in 2023, compared to $127.3 billion in 2022
• Record purchase originations of $93.9 billion in 2023, compared to $90.8 billion in 2022
• Net loss of $69.8 million in 2023, as compared to $931.9 million of net income in 2022
• Total gain margin of 92 bps in 2023 compared to 77 bps in 2022

Production and Income Statement Highlights (dollars in thousands, except per share amounts)

		Q4 2023				Q3 2023				Q4 2022				FY 2023				FY 2022
Loan origination volume(1)		$	24,372,436			$	29,721,633			$	25,126,844			$	108,275,883			$	127,285,461
Total gain margin(1)(2)			0.92	%			0.97	%			0.51	%			0.92	%			0.77	%
Net income (loss)		$	(460,956	)		$	300,993			$	(62,484	)		$	(69,782	)		$	931,858
Diluted earnings (loss) per share			(0.29	)			0.15				(0.03	)			(0.14	)			0.45
Adjusted diluted earnings (loss) per share(3)			(0.23	)			N/A				N/A				(0.04	)			0.45
Adjusted net income (loss)(3)			(361,002	)			234,713				(53,308	)			(57,142	)			719,415
Adjusted EBITDA(3)			99,566				112,062				60,393				478,270				282,402

(1)	Key operational metric (see discussion below).
(2)	Represents total loan production income divided by loan origination volume.
(3)	Non-GAAP metric (see discussion and reconciliations below).

Balance Sheet Highlights as of Period-end (dollars in thousands)

		Q4 2023			Q3 2023			Q4 2022
Cash and cash equivalents		$	497,468		$	729,616		$	704,898
Mortgage loans at fair value			5,449,884			5,560,039			7,134,960
Mortgage servicing rights			4,026,136			4,352,219			4,453,261
Total assets			11,871,854			12,204,137			13,600,625
Non-funding debt (1)			2,862,759			2,617,903			2,880,178
Total equity			2,474,671			3,092,111			3,171,693
Non-funding debt to equity (1)			1.16			0.85			0.91

(1)	Non-GAAP metric (see discussion and reconciliations below).

Mortgage Servicing Rights (dollars in thousands)

		Q4 2023				Q3 2023				Q4 2022
Unpaid principal balance		$	299,456,189			$	281,373,662			$	312,454,025
Weighted average interest rate			4.43	%			4.20	%			3.64	%
Weighted average age (months)			21				20				16

Fourth Quarter Technology and Loan Product Launches

• Launched Memory Maker, UWM’s tool for independent mortgage brokers to send their choice of thank you items to borrowers and real estate agents, leaving a lasting impression long after a loan is closed
• Enhanced PA+, now allowing independent mortgage brokers and their processors more flexibility in choosing which parts of the loan process they would like a UWM Loan Coordinator to facilitate
• Enhancements to Investor Flex, UWM’s Debt Service Coverage Ratio (“DSCR”) product now allows borrowers to close in a Limited Liability Company (LLC), giving borrowers an additional option to separate their personal properties and investment properties

Fourth Quarter Operational Highlights

• Achieved Net Promoter Score of +86.5 in 4Q23.
• Our 1.15% 60+ days delinquency as of December 31, 2023, was significantly better than the industry average of 1.78% (Source: Mortgage Bankers Association, as of Q4 2023).

Product and Investor Mix - Unpaid Principal Balance of Originations (dollars in thousands)

Purchase:		Q4 2023			Q3 2023			Q4 2022			FY 2023			FY 2022
Conventional		$	12,033,818		$	16,237,031		$	15,030,972		$	58,833,673		$	62,274,030
Government			6,805,530			8,031,062			6,135,366			29,640,141			23,773,422
Jumbo and other (1)			1,842,108			1,624,824			484,098			5,381,530			4,782,879
Total Purchase		$	20,681,456		$	25,892,917		$	21,650,436		$	93,855,344		$	90,830,331
Refinance:		Q4 2023			Q3 2023			Q4 2022			FY 2023			FY 2022
Conventional		$	1,386,645		$	1,736,055		$	2,254,680		$	7,082,401		$	27,059,252
Government			1,389,884			1,528,848			1,005,048			5,189,598			7,834,636
Jumbo and other (1)			914,451			563,813			216,680			2,148,540			1,561,242
Total Refinance		$	3,690,980		$	3,828,716		$	3,476,408		$	14,420,539		$	36,455,130
Total Originations		$	24,372,436		$	29,721,633		$	25,126,844		$	108,275,883		$	127,285,461
(1) Comprised of non-agency jumbo products and non-qualified mortgage products, including home equity lines of credit ("HELOCs") (which in many instances are second liens) and construction loans.

First Quarter 2024 Outlook

We anticipate first quarter production to be in the $22 to $28 billion range, with gain margin from 80 to 105 basis points.

Dividend

Subsequent to December 31, 2023, for the thirteenth consecutive quarter, the Company's Board of Directors declared a cash dividend of $0.10 per share on the outstanding shares of Class A common stock. The dividend is payable on April 11, 2024, to stockholders of record at the close of business on March 20, 2024. Additionally, the Board approved a proportional distribution to SFS Corp., which is payable on or about April 11, 2024.

Earnings Conference Call Details

As previously announced, the Company will hold a conference call for financial analysts and investors on Wednesday, February 28, 2024 at 10:30 AM ET to review the results and answer questions. Interested parties may register for a toll-free dial-in number by visiting:

https://registrations.events/direct/Q4I3794250

Please dial in at least 15 minutes in advance to ensure a timely connection to the call. Audio webcast, taped replay and a transcript will be available on the Company's investor relations website at https://investors.uwm.com/.

Key Operational Metrics

“Loan origination volume” and “Total gain margin” are key operational metrics that the Company's management uses to evaluate the performance of the business. “Loan origination volume” is the aggregate principal of the residential mortgage loans originated by the Company during a period. “Total gain margin” represents total loan production income divided by loan origination volume for the applicable periods.

Non-GAAP Metrics

The Company's net income does not reflect the income tax provision that would otherwise be reflected if 100% of the economic interest in UWM was owned by the Company. Therefore, for comparison purposes, the Company provides “Adjusted net income (loss),” which is our pre-tax income (loss) together with an adjusted income tax provision (benefit), which is calculated as the provision for income taxes plus the tax effects of net income attributable to non-controlling interest determined using a blended statutory effective tax rate. “Adjusted net income (loss)” is a non-GAAP metric. "Adjusted diluted EPS" is defined as "Adjusted net income (loss)" divided by the weighted average number of shares of Class A common stock outstanding for the applicable period, assuming the exchange and conversion of all outstanding Class D common stock for Class A common stock, and is calculated and presented for periods in which the assumed exchange and conversion of Class D common stock to Class A common stock is anti-dilutive to EPS.

We also disclose Adjusted EBITDA, which we define as earnings (loss) before interest expense on non-funding debt, provision for income taxes, depreciation and amortization, stock-based compensation expense, the change in fair value of MSRs due to valuation inputs or assumptions, the impact of non-cash deferred compensation expense, the change in fair value of the Public and Private Warrants, the change in Tax Receivable Agreement liability and the change in fair value of retained investment securities. We exclude the change in Tax Receivable Agreement liability, the change in fair value of the Public and Private Warrants, the change in fair value of retained investment securities, and the change in fair value of MSRs due to valuation inputs or assumptions, as these represent non-cash, non-realized adjustments to our earnings, which is not indicative of our performance or results of operations. Adjusted EBITDA includes interest expense on funding facilities, which are recorded as a component of interest expense, as these expenses are a direct operating expense driven by loan origination volume. By contrast, interest expense on non-funding debt is a function of our capital structure and is therefore excluded from Adjusted EBITDA.

In addition, we disclose “Non-funding debt” and the “Non-funding debt to equity ratio” as a non-GAAP metric. We define “Non-funding debt” as the total of the Company's senior notes, lines of credit, borrowings against investment securities, equipment note payable, and finance leases and the “Non-funding debt-to-equity ratio” as total non-funding debt divided by the Company’s total equity.

Management believes that these non-GAAP metrics provide useful information to investors. These measures are not financial measures calculated in accordance with GAAP and should not be considered as a substitute for any other operating performance measure calculated in accordance with GAAP, and may not be comparable to a similarly titled measure reported by other companies.

The following tables set forth the reconciliations of these non-GAAP financial measures to their most directly comparable financial measure calculated in accordance with GAAP (dollars in thousands, except per share amounts):

Adjusted net income (loss)		Q4 2023				Q3 2023				Q4 2022				FY 2023				FY 2022
Earnings (loss) before income taxes		$	(468,408	)		$	301,727			$	(69,258	)		$	(76,293	)		$	934,669
Adjusted income tax benefit (provision)			107,406				(67,014	)			15,950				19,151				(215,254	)
Adjusted net income (loss)		$	(361,002	)		$	234,713			$	(53,308	)		$	(57,142	)		$	719,415

Adjusted diluted EPS		Q4 2023				FY 2023				FY 2022
Diluted weighted average Class A common stock outstanding			93,654,269				93,245,373				92,475,170
Assumed pro forma conversion of Class D common stock (1)			1,502,069,787				1,502,069,787				1,502,069,787
Adjusted diluted weighted average shares outstanding (1)			1,595,724,056				1,595,315,160				1,594,544,957
Adjusted net income (loss)		$	(361,002	)		$	(57,142	)		$	719,415
Adjusted diluted EPS			(0.23	)			(0.04	)			0.45
(1) Reflects the pro forma exchange and conversion of antidilutive Class D common stock to Class A common stock.

Adjusted EBITDA		Q4 2023				Q3 2023				Q4 2022				FY 2023				FY 2022
Net income (loss)		$	(460,956	)		$	300,993			$	(62,484	)		$	(69,782	)		$	931,858
Interest expense on non-funding debt			43,946				42,825				43,611				172,498				132,647
Provision (benefit) for income taxes			(7,452	)			734				(6,774	)			(6,511	)			2,811
Depreciation and amortization			11,472				11,563				11,713				46,146				45,235
Stock-based compensation expense			3,961				3,822				2,055				13,832				7,545
Change in fair value of MSRs due to valuation inputs or assumptions			507,686				(236,044	)			71,865				330,031				(868,803	)
Deferred compensation, net			3,300				(11,755	)			461				(7,938	)			7,370
Change in fair value of Public and Private Warrants			4,808				(2,021	)			54				6,060				(7,683	)
Change in Tax Receivable Agreement liability			260				(3,000	)			—				(1,575	)			3,200
Change in fair value of investment securities			(7,459	)			4,945				(108	)			(4,491	)			28,222
Adjusted EBITDA		$	99,566			$	112,062			$	60,393			$	478,270			$	282,402

Non-funding debt and non-funding debt to equity		Q4 2023			Q3 2023			Q4 2022
Senior notes		$	1,988,267		$	1,987,284		$	1,984,336
Secured lines of credit			750,000			500,000			750,000
Borrowings against investment securities			93,814			97,328			101,345
Equipment note payable			—			—			992
Finance lease liability			30,678			33,291			43,505
Total non-funding debt		$	2,862,759		$	2,617,903		$	2,880,178
Total equity		$	2,474,671		$	3,092,111		$	3,171,693
Non-funding debt to equity			1.16			0.85			0.91

Cautionary Note Regarding Forward-Looking Statements

This press release and our earnings call include forward-looking statements. These forward-looking statements are generally identified by the use of words such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict” and similar words indicating that these reflect our views with respect to future events. Forward-looking statements in this press release and our earnings call include statements regarding: (1) our position amongst our competitors and ability to capture market share; (2) our investment in our people, products and technology and the benefits to our results; (3) our beliefs regarding opportunities in 2024 for our business and the broker channel; (4) our beliefs regarding operational profitability; (5) growth of the wholesale and broker channels, the impact of our strategies on such growth and the benefits to our business of such growth; (6) our growth and strategies to remain the leading mortgage lender, and the timing and drivers of that growth; (7) the benefits and liquidity of our MSR portfolio; (8) our beliefs related to the amount and timing of our dividend; (9) our expectations for future market environments, including interest rates, levels of refinance activity and the timing of such market changes; (10) our expectations related to production and margin in the first quarter of 2024; (11) the benefits of our business model, strategies and initiatives, and their impact on our results and the industry; (12) our performance in shifting market conditions and the comparison of such performance against our competitors; (13) our ability to produce results in future years at or above prior levels or expectations, and our strategies for producing such results; (14) our position and ability to capitalize on market opportunities and the impacts to our results; (15) our investments in technology and the impact to our operations, ability to scale and financial results and (16) our purchase production and product portfolio. These statements are based on management’s current expectations, but are subject to risks and uncertainties, many of which are outside of our control, and could cause future events or results to materially differ from those stated or implied in the forward-looking statements, including; (i) UWM’s dependence on macroeconomic and U.S. residential real estate market conditions, including changes in U.S. monetary policies that affect interest rates; (ii) UWM’s reliance on its warehouse and MSR facilities and the risk of a decrease in the value of the collateral underlying certain of its facilities causing an unanticipated margin call; (iii) UWM’s ability to sell loans in the secondary market; (iv) UWM’s dependence on the government-sponsored entities such as Fannie Mae and Freddie Mac; (v) changes in the GSEs, FHA, USDA and VA guidelines or GSE and Ginnie Mae guarantees; (vi) UWM’s dependence on Independent Mortgage Advisors to originate mortgage loans; (vii) the risk that an increase in the value of the MBS UWM sells in forward markets to hedge its pipeline may result in an unanticipated margin call; (viii) UWM’s inability to continue to grow, or to effectively manage the growth of its loan origination volume; (ix) UWM’s ability to continue to attract and retain its broker relationships; (x) UWM’s ability to implement technological innovation; (xi) the occurrence of a data breach or other failure of UWM’s cybersecurity or information security systems; (xii) the occurrence of data breaches or other cybersecurity failures at our third-party sub-servicers or other third-party vendors; (xiii) UWM’s ability to continue to comply with the complex state and federal laws, regulations or practices applicable to mortgage loan origination and servicing in general; and (xiv) other risks and uncertainties indicated from time to time in our filings with the Securities and Exchange Commission including those under “Risk Factors” therein. We wish to caution readers that certain important factors may have affected and could in the future affect our results and could cause actual results for subsequent periods to differ materially from those expressed in any forward-looking statement made by or on behalf of us. We undertake no obligation to update forward-looking statements to reflect events or circumstances after the date hereof.

About UWM Holdings Corporation and United Wholesale Mortgage

Headquartered in Pontiac, Michigan, UWM Holdings Corporation (UWMC) is the publicly traded indirect parent of United Wholesale Mortgage, LLC (“UWM”). UWM is the nation’s largest home mortgage lender, despite exclusively originating mortgage loans through the wholesale channel. UWM has been the largest wholesale mortgage lender for nine consecutive years and is the largest purchase lender in the nation. With a culture of continuous innovation of technology and enhanced client experience, UWM leads the market by building upon its proprietary and exclusively licensed technology platforms, superior service and focused partnership with the independent mortgage broker community. UWM originates primarily conforming and government loans across all 50 states and the District of Columbia. For more information, visit uwm.com or call 800-981-8898. NMLS #3038.

UWM HOLDINGS CORPORATION CONSOLIDATED BALANCE SHEETS (in thousands, except shares and per share amounts)
	December 31, 2023			December 31, 2022
Assets
Cash and cash equivalents	$	497,468		$	704,898
Mortgage loans at fair value		5,449,884			7,134,960
Derivative assets		33,019			82,869
Investment securities at fair value, pledged		110,352			113,290
Accounts receivable, net		512,070			383,147
Mortgage servicing rights		4,026,136			4,453,261
Premises and equipment, net		146,417			152,477
Operating lease right-of-use asset, net (includes $97,596 and $102,322 with related parties)		99,125			104,181
Finance lease right-of-use asset (includes $24,802 and $26,867 with related parties)		29,111			42,218
Loans eligible for repurchase from Ginnie Mae		856,856			345,490
Other assets		111,416			83,834
Total assets	$	11,871,854		$	13,600,625
Liabilities and Equity
Warehouse lines of credit	$	4,902,090		$	6,443,992
Derivative liabilities		40,781			49,748
Secured line of credit		750,000			750,000
Borrowings against investment securities		93,814			101,345
Accounts payable, accrued expenses and other		469,101			439,719
Accrued distributions and dividends payable		159,572			159,465
Senior notes		1,988,267			1,984,336
Operating lease liability (includes $104,495 and $109,473 with related parties)		106,024			111,332
Finance lease liability (includes $26,260 and $27,857 with related parties)		30,678			43,505
Loans eligible for repurchase from Ginnie Mae		856,856			345,490
Total liabilities		9,397,183			10,428,932
Equity:
Preferred stock, $0.0001 par value - 100,000,000 shares authorized, none issued and outstanding as of December 31, 2023 or December 31, 2022		—			—
Class A common stock, $0.0001 par value - 4,000,000,000 shares authorized, 93,654,269 and 92,575,974 shares issued and outstanding as of December 31, 2023 and December 31, 2022, respectively		10			9
Class B common stock, $0.0001 par value - 1,700,000,000 shares authorized, none issued and outstanding as of December 31, 2023 or December 31, 2022		—			—
Class C common stock, $0.0001 par value - 1,700,000,000 shares authorized, none issued and outstanding as of December 31, 2023 or December 31, 2022		—			—
Class D common stock, $0.0001 par value - 1,700,000,000 shares authorized, 1,502,069,787 shares issued and outstanding as of December 31, 2023 and December 31, 2022, respectively		150			150
Additional paid-in capital		1,702			903
Retained earnings		110,690			142,500
Non-controlling interest		2,362,119			3,028,131
Total equity		2,474,671			3,171,693
Total liabilities and equity	$	11,871,854		$	13,600,625

UWM HOLDINGS CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except shares and per share amounts)
	For the three months ended												For the year ended
	December 31, 2023				September 30, 2023				December 31, 2022				December 31, 2023				December 31, 2022
Revenue	(Unaudited)				(Unaudited)				(Unaudited)
Loan production income	$	225,436			$	288,930			$	129,180			$	1,000,547			$	981,988
Loan servicing income		206,498				200,428				217,225				818,703				792,072
Change in fair value of mortgage servicing rights		(634,418	)			92,909				(150,808	)			(854,148	)			284,104
Interest income		87,901				94,849				106,837				346,225				314,462
Total revenue, net		(114,583	)			677,116				302,434				1,311,327				2,372,626
Expenses
Salaries, commissions and benefits		142,515				135,333				118,266				530,231				552,886
Direct loan production costs		27,977				36,184				17,396				104,262				90,369
Marketing, travel, and entertainment		25,600				20,117				22,976				84,515				74,168
Depreciation and amortization		11,472				11,563				11,713				46,146				45,235
General and administrative		38,209				44,904				49,668				170,423				179,549
Servicing costs		29,632				33,640				36,809				131,792				166,024
Interest expense		80,811				93,724				114,918				320,256				305,987
Other expense (income)		(2,391	)			(76	)			(54	)			(5	)			23,739
Total expenses		353,825				375,389				371,692				1,387,620				1,437,957
Earnings (loss) before income taxes		(468,408	)			301,727				(69,258	)			(76,293	)			934,669
Provision (benefit) for income taxes		(7,452	)			734				(6,774	)			(6,511	)			2,811
Net income (loss)		(460,956	)			300,993				(62,484	)			(69,782	)			931,858
Net income (loss) attributable to non-controlling interest		(433,878	)			282,762				(62,207	)			(56,552	)			890,143
Net income (loss) attributable to UWMC	$	(27,078	)		$	18,231			$	(277	)		$	(13,230	)		$	41,715
Earnings (loss) per share of Class A common stock:
Basic	$	(0.29	)		$	0.20			$	—			$	(0.14	)		$	0.45
Diluted	$	(0.29	)		$	0.15			$	(0.03	)		$	(0.14	)		$	0.45
Weighted average shares outstanding:
Basic		93,654,269				93,290,736				92,575,549				93,245,373				92,475,170
Diluted		93,654,269				1,596,624,780				1,594,645,336				93,245,373				92,475,170

Addendum to Exhibit 99.1

This addendum includes the Company's Consolidated Balance Sheets as of December 31, 2023, and the preceding four quarters and Statements of Operations for the quarter ended December 31, 2023, and the preceding four quarters for purposes of providing historical quarterly trending information to investors.

CONSOLIDATED BALANCE SHEETS (in thousands, except shares and per share amounts)
	December 31, 2023			September 30, 2023			June 30, 2023			March 31, 2023			December 31, 2022
Assets				(Unaudited)			(Unaudited)			(Unaudited)
Cash and cash equivalents	$	497,468		$	729,616		$	634,576		$	740,063		$	704,898
Mortgage loans at fair value		5,449,884			5,560,039			6,269,924			4,800,259			7,134,960
Derivative assets		33,019			92,791			61,407			61,136			82,869
Investment securities at fair value, pledged		110,352			104,526			111,625			114,275			113,290
Accounts receivable, net		512,070			385,922			347,865			433,747			383,147
Mortgage servicing rights		4,026,136			4,352,219			4,224,207			3,974,870			4,453,261
Premises and equipment, net		146,417			146,509			149,515			152,428			152,477
Operating lease right-of-use asset, net		99,125			100,427			101,686			102,923			104,181
Finance lease right-of-use asset		29,111			31,803			34,947			38,320			42,218
Loans eligible for repurchase from Ginnie Mae		856,856			617,490			409,078			440,775			345,490
Other assets		111,416			82,795			81,089			88,920			83,834
Total assets	$	11,871,854		$	12,204,137		$	12,425,919		$	10,947,716		$	13,600,625
Liabilities and Equity
Warehouse lines of credit	$	4,902,090		$	5,066,900		$	5,732,791		$	4,259,834		$	6,443,992
Derivative liabilities		40,781			38,882			21,734			62,742			49,748
Secured line of credit		750,000			500,000			500,000			500,000			750,000
Borrowings against investment securities		93,814			97,328			100,901			101,345			101,345
Accounts payable, accrued expenses and other		469,101			503,890			423,407			416,818			439,719
Accrued distributions and dividends payable		159,572			159,572			159,518			159,517			159,465
Senior notes		1,988,267			1,987,284			1,986,301			1,985,319			1,984,336
Operating lease liability		106,024			107,389			108,711			110,012			111,332
Finance lease liability		30,678			33,291			36,356			36,812			43,505
Loans eligible for repurchase from Ginnie Mae		856,856			617,490			409,078			440,775			345,490
Total liabilities		9,397,183			9,112,026			9,478,797			8,073,174			10,428,932
Equity:
Preferred stock, $0.0001 par value - 100,000,000 shares authorized, none issued and outstanding as of each of the periods presented		—			—			—			—			—
Class A common stock, $0.0001 par value - 4,000,000,000 shares authorized; shares issued and outstanding - 93,654,269 as of December 31, 2023 , 93,654,269 as of September 30, 2023, 93,114,878 as of June 30, 2023, and 93,101,971 as of March 31, 2023 and 92,575,974 as of December 31, 2022		10			10			9			9			9
Class B common stock, $0.0001 par value - 1,700,000,000 shares authorized, none issued and outstanding as of each of the periods presented		—			—			—			—			—
Class C common stock, $0.0001 par value - 1,700,000,000 shares authorized, none issued and outstanding as of each of the periods presented		—			—			—			—			—
Class D common stock, $0.0001 par value - 1,700,000,000 shares authorized, 1,502,069,787 shares issued and outstanding as of each of the periods presented		150			150			150			150			150
Additional paid-in capital		1,702			1,484			1,267			1,036			903
Retained earnings		110,690			130,233			120,379			122,136			142,500
Non-controlling interest		2,362,119			2,960,234			2,825,317			2,751,211			3,028,131
Total equity		2,474,671			3,092,111			2,947,122			2,874,542			3,171,693
Total liabilities and equity	$	11,871,854		$	12,204,137		$	12,425,919		$	10,947,716		$	13,600,625

CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except shares and per share amounts) (Unaudited)
	For the three months ended
	December 31, 2023			September 30, 2023			June 30, 2023		March 31, 2023			December 31, 2022
Revenue
Loan production income	$	225,436		$	288,930		$	280,757	$	205,424		$	129,180
Loan servicing income		206,498			200,428			193,220		218,557			217,225
Change in fair value of mortgage servicing rights		(634,418	)		92,909			24,648		(337,287	)		(150,808	)
Interest income		87,901			94,849			88,895		74,580			106,837
Total revenue, net		(114,583	)		677,116			587,520		161,274			302,434
Expenses
Salaries, commissions and benefits		142,515			135,333			131,380		121,003			118,266
Direct loan production costs		27,977			36,184			23,618		16,483			17,396
Marketing, travel, and entertainment		25,600			20,117			21,588		17,210			22,976
Depreciation and amortization		11,472			11,563			11,441		11,670			11,713
General and administrative		38,209			44,904			52,691		34,619			49,668
Servicing costs		29,632			33,640			31,658		36,862			36,809
Interest expense		80,811			93,724			82,437		63,284			114,918
Other expense (income)		(2,391	)		(76	)		2,703		(241	)		(54	)
Total expenses		353,825			375,389			357,516		300,890			371,692
Earnings (loss) before income taxes		(468,408	)		301,727			230,004		(139,616	)		(69,258	)
Provision (benefit) for income taxes		(7,452	)		734			1,210		(1,003	)		(6,774	)
Net income (loss)		(460,956	)		300,993			228,794		(138,613	)		(62,484	)
Net income (loss) attributable to non-controlling interest		(433,878	)		282,762			221,236		(126,672	)		(62,207	)
Net income (loss) attributable to UWMC	$	(27,078	)	$	18,231		$	7,558	$	(11,941	)	$	(277	)
Earnings (loss) per share of Class A common stock:
Basic	$	(0.29	)	$	0.20		$	0.08	$	(0.13	)	$	—
Diluted	$	(0.29	)	$	0.15		$	0.08	$	(0.13	)	$	(0.03	)
Weighted average shares outstanding:
Basic		93,654,269			93,290,736			93,107,133		92,920,794			92,575,549
Diluted		93,654,269			1,596,624,780			93,107,133		92,920,794			1,594,645,336

 

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For inquiries regarding UWM, please contact:

INVESTOR CONTACT

BLAKE KOLO

InvestorRelations@uwm.com

MEDIA CONTACT

NICOLE ROBERTS

Media@uwm.com

Source: UWM Holdings Corporation

FAQ

What was UWM Holdings Corporation's loan origination volume in the fourth quarter of 2023?

UWM Holdings Corporation reported a loan origination volume of $24.4 billion in the fourth quarter of 2023.

What was the net loss for UWM Holdings Corporation in the fourth quarter of 2023?

UWM Holdings Corporation experienced a net loss of $461.0 million in the fourth quarter of 2023.

What contributed to the net loss for UWM Holdings Corporation in the fourth quarter of 2023?

The net loss for UWM Holdings Corporation in the fourth quarter of 2023 was mainly due to a $634.4 million decline in fair value of MSRs.

What was the total loan origination volume for UWM Holdings Corporation in full year 2023?

UWM Holdings Corporation reported a total loan origination volume of $108.3 billion for full year 2023.

What was the company's focus for future growth despite the financial loss?

UWM Holdings Corporation aims to invest in its people, products, and technology for future growth.

What was the record purchase originations amount for UWM Holdings Corporation in full year 2023?

UWM Holdings Corporation achieved record purchase originations of $93.9 billion in full year 2023.