Company: BLNE
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001641172-25-024044
Chunk: 49

Company: Beeline Holdings, Inc.
Filing Date: 2025-08-14
Form: 10-Q
Item: Part I, Item 8
Chunk 49
---
 in challenging market
conditions, Beeline Financial may need to invest additional resources in sales and marketing to maintain growth. Increased marketing
expenditures could elevate service costs, making it essential to balance customer acquisition efforts with cost efficiency.

In
the ordinary course of Beeline Financial’s operations, it finances the majority of its loan volume on a short-term basis, typically
less than 10 days, mainly utilizing a warehouse line of credit with a capacity of $5.0 million. The repayments of Beeline Financial’s
borrowings come from the revenue generated by selling its loans to a network of purchasers.

In
2024, Beeline Financial made significant investments in its platform to leverage mortgage origination opportunities, despite overall
lower volumes compared to 2020 and 2021 due to fluctuating interest rates. In the fourth quarter, a temporary decline in the 10-year
Treasury rate drove a notable increase in loan originations, reinforcing our belief that interest rates, housing supply, and affordability
will remain key factors influencing future volume. Additionally, Beeline Financial has expanded its focus on its B2B SaaS strategy, which
is also subject to macroeconomic conditions.

To
measure operational efficiency and growth, we track a range of performance metrics in our lending and title businesses, including production
data. Beeline Loans, the principal operating subsidiary of Beeline Financial, uses data to track margin and gain-on-sale revenue. The
title companies use data to track file revenue. Beeline uses industry tools to benchmark its margin and note rates against the broader
mortgage origination market. We also evaluate key business drivers for Beeline Financial subsidiaries, such as Beeline Labs, by monitoring
revenue, unit sales, and SaaS (B2B) growth potential. Additionally, we assess customer acquisition costs and profitability per loan to
optimize financial performance. These key indicators help gauge progress toward our strategic and long-term growth objectives.

Recent
Developments

Business
Trends

From
January through July 2025, U.S. inflation trended lower, though the pace of improvement varied across components. Headline consumer price
index (“CPI”) began the year at roughly 2.9% year-over-year in January, down from 3.2% in December 2024, as energy prices
eased, food inflation moderated, and shelter costs began to cool. February saw a slight drop to around 2.8%, with goods inflation largely
flat or negative due to stable commodity prices