What is business dominance?

The point of dominance was made at last week’s earnings call as Ishbia assured shareholders that UWM was still the nation’s largest mortgage lender, topping arch-rival Rocket Companies. “We are the strongest mortgage company in America, period,” Ishbia said. The company’s $25 billion in mortgage originations bested its rival’s total of $19 billion. Rocket Companies released its own fourth quarter results the day before UWM, revealing its own net loss of $493 million in the fourth quarter. Like UWM, the loss was the first since Rocket Companies went public (in August 2020).

Ishbia sought to put UWM’s loss in some context “Now in the fourth quarter, we showed a $62.5 million loss, but that’s inclusive of about a $151 million decrease of fair value of MSRs (mortgage servicing rights). So really operationally profitable once again. Our gain margin was 51 basis, well within our guidance. And the momentum with the broker channel has never been stronger in the last six months since announcing game on strategy, as a result of more retail loan officers joining the wholesale channel than ever before.”

He added: “In addition, the second largest month of all time of retail loan officers converting over was January of this year, just 1.5 months ago. And so amazing numbers – and a lot of that stuff takes six, nine, 12 months for them to actually produce, get going, get licensed and switch over. So all of the benefits have still not really come to fruition. We’re really proud of the ‘game on’ strategy and all the great things that’s done for the broker community and for UWM as a partner with brokers.”

What is competitive advantage?

He ended on an up note, despite having to report the multimillion-dollar loss in the fourth: “As you can tell, I’m excited about 2023, a year in which we can expect our competitive advantage to continue to become clearer to everybody as we continue to invest in our people, the brokers and our business. We know this formula works because we’ve seen it in similar market cycles and every time we’ve emerged stronger and more dominant. Right now, it is not any different.”

Last week’s earnings call also was the first for the company’s newly appointed chief financial officer Andrew Hubacker, who joined the company more than two years ago. In a February news release, the company said Hubacker would oversee all financial aspects of the company including accounting, internal and external reporting, financial compliance, tax, treasury and liquidity management, and budgeting and forecasting. Hubacker originally joined the company in October of 2020 as chief accounting officer and took on the role of interim principal financial officer in July of 2022.