Shares of Foothill Ranch-based loanDepot Inc. (NYSE: LDI) declined 7.6% in after-hours trading following its second-quarter results that missed analysts’ expectations.
The company, the nation’s seventh largest mortgage originator, reported revenue dropped 60% to $308.6 million and a 66-cent per share loss. Analysts were expecting sales of $372 million and a 21-cent loss.
“Our second quarter results reflect the extremely challenging market environment that continues in our industry, which led to ongoing declines in our mortgage volumes and profit margins,” Chief Executive Frank Martell said in a statement.
The company last month announced large layoffs as the Federal Reserve’s increase of interest rates has dried up mortgage refinancings, which is loanDepot’s largest market.
The company today said it plans to reduce its headcount to even below its prior stated goal of 6,500 by the end of 2022. As of early August, the company’s headcount was 7,400, down from 11,300 at the end of 2021.
The company also said it will exit the wholesale channel, where it provides loans and other services to independent mortgage originators.
“Our exit from wholesale will also enable us to direct resources to other origination channels, reduce operational complexities and increase margins,” the company said.
Shares dropped to $1.70 after the results were announced. A year ago, the shares almost touched $40 and a $4 billion market cap.
For a deeper dive into loanDepot, see the July 18 print issue of the Business Journal.