[10-Q] ALTISOURCE PORTFOLIO SOLUTIONS S.A. Quarterly Earnings Report
Filing Impact
Filing Sentiment
Form Type
10-Q
Altisource Portfolio Solutions (ASPS) filed its Q3 2025 report. Revenue was $41.9 million versus $40.5 million a year ago, with gross profit of $11.3 million. Selling, general and administrative expenses were $10.8 million, resulting in income from operations of $0.5 million. Interest expense fell to $2.4 million from $10.0 million, and the quarter ended with a net loss attributable to Altisource of $2.4 million, an improvement from a $9.4 million loss last year.
For the first nine months, revenue reached $128.6 million versus $119.1 million, and net income attributable to Altisource was $8.8 million, aided by a $15.1 million income tax benefit. Cash and cash equivalents were $28.6 million. The company completed a debt exchange, replacing $232.8 million of prior term loans with a $160.0 million new first lien facility and issued 7.3 million shares; it also added a $12.5 million super senior facility. Long‑term debt, net, was $191.3 million.
Altisource executed a 1‑for‑8 share consolidation on May 28, 2025. Customer concentration remained high: Onity accounted for 42% of Q3 consolidated revenue.
Altisource Portfolio Solutions (ASPS) ha pubblicato il suo rapporto Q3 2025. Le entrate sono state di 41,9 milioni di dollari contro 40,5 milioni l'anno precedente, con un utile lordo di 11,3 milioni. Le spese di vendita, generali e amministrative ammontavano a 10,8 milioni, risultando in un reddito operativo di 0,5 milioni. Il costo degli interessi è diminuito a 2,4 milioni da 10,0 milioni, e il trimestre si è chiuso con una perdita netta attribuibile ad Altisource di 2,4 milioni, un miglioramento rispetto a una perdita di 9,4 milioni lo scorso anno.
Per i primi nove mesi, le entrate hanno raggiunto 128,6 milioni contro 119,1 milioni, e l'utile netto attribuibile ad Altisource è stato di 8,8 milioni, agevolato da un beneficio fiscale di 15,1 milioni. La cassa e i valori equivalenti erano 28,6 milioni. L'azienda ha completato uno scambio di debito, sostituendo 232,8 milioni di dollari di vecchi prestiti a termine con una nuova facility di primo onere da 160,0 milioni e ha emesso 7,3 milioni di azioni; ha inoltre aggiunto una facility super senior da 12,5 milioni. Il debito a lungo termine, al netto, era di 191,3 milioni.
Altisource ha eseguito una consolidazione azionaria di 1 per 8 il 28 maggio 2025. La concentrazione della clientela rimaneva elevata: Onity rappresentava il 42% del fatturato consolidato nel Q3.
Altisource Portfolio Solutions (ASPS) presentó su informe del tercer trimestre de 2025. Los ingresos fueron de 41,9 millones de dólares frente a 40,5 millones de hace un año, con un beneficio bruto de 11,3 millones. Los gastos de venta, generales y administrativos fueron 10,8 millones, resultando en una ganancia operativa de 0,5 millones. El gasto por intereses cayó a 2,4 millones desde 10,0 millones, y el trimestre cerró con una pérdida neta atribuible a Altisource de 2,4 millones, una mejora respecto a una pérdida de 9,4 millones el año pasado.
Para los primeros nueve meses, los ingresos alcanzaron 128,6 millones frente a 119,1 millones, y el ingreso neto atribuible a Altisource fue de 8,8 millones, ayudado por un beneficio fiscal de 15,1 millones. El efectivo y equivalentes de efectivo fueron de 28,6 millones. La empresa completó un intercambio de deuda, reemplazando 232,8 millones de dólares de préstamos anteriores por una nueva facilidad de primera prioridad de 160,0 millones y emitió 7,3 millones de acciones; también añadió una facilidad superior de 12,5 millones. La deuda a largo plazo, neta, fue de 191,3 millones.
Altisource ejecutó una consolidación de acciones de 1 por 8 el 28 de mayo de 2025. La concentración de clientes siguió siendo alta: Onity representó el 42% de los ingresos consolidados del tercer trimestre.
Altisource Portfolio Solutions (ASPS)가 2025년 3분기 보고서를 제출했습니다. 매출은 전년 동기 4050만 달러 대비 4190만 달러였으며 총이익은 1130만 달러였습니다. 판매, 일반 및 관리비는 1080만 달러였고 영업이익은 50만 달러였습니다. 이자비용은 240만 달러로 감소했고 전분기 순손실은 Altisource에 귀속되는 240만 달러였으며 작년 같은 기간의 손실 940만 달러에서 개선되었습니다.
9개월 누적 매출은 1억2860만 달러로 전년 동기 1억1910만 달러를 기록했고 Altisource에 귀속되는 순이익은 880만 달러였으며 1510만 달러의 법인세 혜택이 있었다고 밝혔습니다. 현금 및 현금성자산은 2860만 달러였습니다. 회사는 부채 교환을 완료하여 이전의 만기 대출 2억3280만 달러를 1억6000만 달러의 신규 1계인(Lien) 시설로 교체하고 730만 주를 발행했으며 1250만 달러의 슈퍼 시니어 시설도 추가했습니다. 순부채는 1억9130만 달러였습니다.
Altisource는 2025년 5월 28일에 8대1의 주식 합병을 수행했습니다. 고객 집중도는 여전히 높았으며 Onity가 3분기 연결매출의 42%를 차지했습니다.
Altisource Portfolio Solutions (ASPS) a déposé son rapport T3 2025. Le chiffre d'affaires s'est élevé à 41,9 millions de dollars contre 40,5 millions l'année précédente, avec un bénéfice brut de 11,3 millions. Les frais de vente, généraux et administratifs se sont élevés à 10,8 millions, ce qui a donné un résultat opérationnel de 0,5 million. Les intérêts financiers se sont déchargés à 2,4 millions contre 10,0 millions, et le trimestre s'est clôturé par une perte nette attribuable à Altisource de 2,4 millions, en amélioration par rapport à une perte de 9,4 millions l'an dernier.
Pendant les neuf premiers mois, le chiffre d'affaires a atteint 128,6 millions contre 119,1 millions, et le résultat net attribuable à Altisource a été de 8,8 millions, aidé par un avantage fiscal de 15,1 millions. La trésorerie et équivalents de trésorerie s'élevaient à 28,6 millions. La société a réalisé un échange de dette, remplaçant 232,8 millions de dollars de prêts à terme antérieurs par une nouvelle facilité de premier rang de 160,0 millions et a émis 7,3 millions d'actions; elle a également ajouté une facilité super senior de 12,5 millions. La dette à long terme nette s'élevait à 191,3 millions.
Altisource a procédé à une consolidation d'actions de 1 pour 8 le 28 mai 2025. La concentration de la clientèle est restée élevée: Onity représentait 42% du chiffre d'affaires consolidé au T3.
Altisource Portfolio Solutions (ASPS) hat den Q3 2025 Bericht eingereicht. Der Umsatz betrug 41,9 Mio. USD gegenüber 40,5 Mio. USD im Vorjahr, mit einem Bruttogewinn von 11,3 Mio. USD. Vertrieb, allgemeine Verwaltungsausgaben betrugen 10,8 Mio. USD, was zu einem operativen Ergebnis von 0,5 Mio. USD führte. Zinsaufwand sank auf 2,4 Mio. USD von 10,0 Mio. USD, und das Quartal endete mit einem dem Altisource zurechenbaren Nettoverlust von 2,4 Mio. USD, eine Verbesserung gegenüber dem Verlust von 9,4 Mio. USD im Vorjahr.
Für die ersten neun Monate erreichten die Umsätze 128,6 Mio. USD gegenüber 119,1 Mio. USD, und das dem Altisource zurechenbare Nettoeinkommen betrug 8,8 Mio. USD, getragen von einem Steuerbenefit in Höhe von 15,1 Mio. USD. Bargeld und Zahlungsmittel beliefen sich auf 28,6 Mio. USD. Das Unternehmen führte einen Schuldenaustausch durch, bei dem 232,8 Mio. USD alter Term Loans durch eine neue First-Lien-Fazilität von 160,0 Mio. USD ersetzt wurden und 7,3 Mio. Aktien ausgegeben wurden; zudem wurde eine Super-Senior-Fazilität über 12,5 Mio. USD hinzugefügt. Langfristige Schulden, netto, beliefen sich auf 191,3 Mio. USD.
Altisource führte am 28. Mai 2025 eine 1-für-8-Aktienzusammenlegung durch. Die Kundenzusammenstellung blieb hoch: Onity machte 42% des konsolidierten Q3-Umsatzes aus.
قدمت Altisource Portfolio Solutions (ASPS) تقريرها للربع الثالث 2025. بلغ الإيراد 41.9 مليون دولار مقابل 40.5 مليون دولار قبل عام، مع هامش ربح إجمالي قدره 11.3 مليون دولار. وكانت المصروفات البيعية والعمومية والإدارية 10.8 مليون دولار، مما أسفر عن دخل تشغيلي قدره 0.5 مليون دولار. انخفضت مصاريف الفوائد إلى 2.4 مليون دولار من 10.0 ملايين دولار، وانتهى الفصل بخسارة صافية تعزى إلى Altisource قدرها 2.4 مليون دولار، وهو تحسن من خسارة قدرها 9.4 ملايين دولار في العام الماضي.
لأول تسعة أشهر، بلغ الإيراد 128.6 مليون دولار مقابل 119.1 مليون دولار، وكانت صافي الربح العائد إلى Altisource 8.8 مليون دولار، مدعومًا بفائدة ضريبية قدرها 15.1 مليون دولار. النقد والنقد المعادل كان 28.6 مليون دولار. أكملت الشركة تبادل ديون، باستبدال 232.8 مليون دولار من قروض آجلة سابقة بمرافق أولية جديدة بقيمة 160.0 مليون دولار وأصدرت 7.3 مليون سهم؛ كما أضافت مرفقًا فائق الأهمية بقيمة 12.5 مليون دولار. الدين طويل الأجل، صافي، كان 191.3 مليون دولار.
نفذت Altisource عملية دمج أسهم 1 مقابل 8 في 28 مايو 2025. ظل تركيز العملاء عاليًا: Onity استحوذت على 42% من إيرادات الربع الثالث المجمّعة.
Positive
- None.
Negative
- None.
Insights
Debt exchange reduced cash interest and extended maturities.
Altisource exchanged
Q3 interest expense declined to
Key dependencies include compliance with new covenants, mandatory prepayment waterfalls, and maintaining minimum liquidity under the super senior facility. Subsequent filings may detail excess cash flow sweep outcomes for
Revenue edged higher; Q3 loss narrowed year over year.
Q3 revenue was
Customer concentration remains a factor: Onity represented
Altisource Portfolio Solutions (ASPS) ha pubblicato il suo rapporto Q3 2025. Le entrate sono state di 41,9 milioni di dollari contro 40,5 milioni l'anno precedente, con un utile lordo di 11,3 milioni. Le spese di vendita, generali e amministrative ammontavano a 10,8 milioni, risultando in un reddito operativo di 0,5 milioni. Il costo degli interessi è diminuito a 2,4 milioni da 10,0 milioni, e il trimestre si è chiuso con una perdita netta attribuibile ad Altisource di 2,4 milioni, un miglioramento rispetto a una perdita di 9,4 milioni lo scorso anno.
Per i primi nove mesi, le entrate hanno raggiunto 128,6 milioni contro 119,1 milioni, e l'utile netto attribuibile ad Altisource è stato di 8,8 milioni, agevolato da un beneficio fiscale di 15,1 milioni. La cassa e i valori equivalenti erano 28,6 milioni. L'azienda ha completato uno scambio di debito, sostituendo 232,8 milioni di dollari di vecchi prestiti a termine con una nuova facility di primo onere da 160,0 milioni e ha emesso 7,3 milioni di azioni; ha inoltre aggiunto una facility super senior da 12,5 milioni. Il debito a lungo termine, al netto, era di 191,3 milioni.
Altisource ha eseguito una consolidazione azionaria di 1 per 8 il 28 maggio 2025. La concentrazione della clientela rimaneva elevata: Onity rappresentava il 42% del fatturato consolidato nel Q3.
Altisource Portfolio Solutions (ASPS) presentó su informe del tercer trimestre de 2025. Los ingresos fueron de 41,9 millones de dólares frente a 40,5 millones de hace un año, con un beneficio bruto de 11,3 millones. Los gastos de venta, generales y administrativos fueron 10,8 millones, resultando en una ganancia operativa de 0,5 millones. El gasto por intereses cayó a 2,4 millones desde 10,0 millones, y el trimestre cerró con una pérdida neta atribuible a Altisource de 2,4 millones, una mejora respecto a una pérdida de 9,4 millones el año pasado.
Para los primeros nueve meses, los ingresos alcanzaron 128,6 millones frente a 119,1 millones, y el ingreso neto atribuible a Altisource fue de 8,8 millones, ayudado por un beneficio fiscal de 15,1 millones. El efectivo y equivalentes de efectivo fueron de 28,6 millones. La empresa completó un intercambio de deuda, reemplazando 232,8 millones de dólares de préstamos anteriores por una nueva facilidad de primera prioridad de 160,0 millones y emitió 7,3 millones de acciones; también añadió una facilidad superior de 12,5 millones. La deuda a largo plazo, neta, fue de 191,3 millones.
Altisource ejecutó una consolidación de acciones de 1 por 8 el 28 de mayo de 2025. La concentración de clientes siguió siendo alta: Onity representó el 42% de los ingresos consolidados del tercer trimestre.
Altisource Portfolio Solutions (ASPS)가 2025년 3분기 보고서를 제출했습니다. 매출은 전년 동기 4050만 달러 대비 4190만 달러였으며 총이익은 1130만 달러였습니다. 판매, 일반 및 관리비는 1080만 달러였고 영업이익은 50만 달러였습니다. 이자비용은 240만 달러로 감소했고 전분기 순손실은 Altisource에 귀속되는 240만 달러였으며 작년 같은 기간의 손실 940만 달러에서 개선되었습니다.
9개월 누적 매출은 1억2860만 달러로 전년 동기 1억1910만 달러를 기록했고 Altisource에 귀속되는 순이익은 880만 달러였으며 1510만 달러의 법인세 혜택이 있었다고 밝혔습니다. 현금 및 현금성자산은 2860만 달러였습니다. 회사는 부채 교환을 완료하여 이전의 만기 대출 2억3280만 달러를 1억6000만 달러의 신규 1계인(Lien) 시설로 교체하고 730만 주를 발행했으며 1250만 달러의 슈퍼 시니어 시설도 추가했습니다. 순부채는 1억9130만 달러였습니다.
Altisource는 2025년 5월 28일에 8대1의 주식 합병을 수행했습니다. 고객 집중도는 여전히 높았으며 Onity가 3분기 연결매출의 42%를 차지했습니다.
Altisource Portfolio Solutions (ASPS) a déposé son rapport T3 2025. Le chiffre d'affaires s'est élevé à 41,9 millions de dollars contre 40,5 millions l'année précédente, avec un bénéfice brut de 11,3 millions. Les frais de vente, généraux et administratifs se sont élevés à 10,8 millions, ce qui a donné un résultat opérationnel de 0,5 million. Les intérêts financiers se sont déchargés à 2,4 millions contre 10,0 millions, et le trimestre s'est clôturé par une perte nette attribuable à Altisource de 2,4 millions, en amélioration par rapport à une perte de 9,4 millions l'an dernier.
Pendant les neuf premiers mois, le chiffre d'affaires a atteint 128,6 millions contre 119,1 millions, et le résultat net attribuable à Altisource a été de 8,8 millions, aidé par un avantage fiscal de 15,1 millions. La trésorerie et équivalents de trésorerie s'élevaient à 28,6 millions. La société a réalisé un échange de dette, remplaçant 232,8 millions de dollars de prêts à terme antérieurs par une nouvelle facilité de premier rang de 160,0 millions et a émis 7,3 millions d'actions; elle a également ajouté une facilité super senior de 12,5 millions. La dette à long terme nette s'élevait à 191,3 millions.
Altisource a procédé à une consolidation d'actions de 1 pour 8 le 28 mai 2025. La concentration de la clientèle est restée élevée: Onity représentait 42% du chiffre d'affaires consolidé au T3.
Altisource Portfolio Solutions (ASPS) hat den Q3 2025 Bericht eingereicht. Der Umsatz betrug 41,9 Mio. USD gegenüber 40,5 Mio. USD im Vorjahr, mit einem Bruttogewinn von 11,3 Mio. USD. Vertrieb, allgemeine Verwaltungsausgaben betrugen 10,8 Mio. USD, was zu einem operativen Ergebnis von 0,5 Mio. USD führte. Zinsaufwand sank auf 2,4 Mio. USD von 10,0 Mio. USD, und das Quartal endete mit einem dem Altisource zurechenbaren Nettoverlust von 2,4 Mio. USD, eine Verbesserung gegenüber dem Verlust von 9,4 Mio. USD im Vorjahr.
Für die ersten neun Monate erreichten die Umsätze 128,6 Mio. USD gegenüber 119,1 Mio. USD, und das dem Altisource zurechenbare Nettoeinkommen betrug 8,8 Mio. USD, getragen von einem Steuerbenefit in Höhe von 15,1 Mio. USD. Bargeld und Zahlungsmittel beliefen sich auf 28,6 Mio. USD. Das Unternehmen führte einen Schuldenaustausch durch, bei dem 232,8 Mio. USD alter Term Loans durch eine neue First-Lien-Fazilität von 160,0 Mio. USD ersetzt wurden und 7,3 Mio. Aktien ausgegeben wurden; zudem wurde eine Super-Senior-Fazilität über 12,5 Mio. USD hinzugefügt. Langfristige Schulden, netto, beliefen sich auf 191,3 Mio. USD.
Altisource führte am 28. Mai 2025 eine 1-für-8-Aktienzusammenlegung durch. Die Kundenzusammenstellung blieb hoch: Onity machte 42% des konsolidierten Q3-Umsatzes aus.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
| (Mark One) | |||||
| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
For the quarterly period ended September 30, 2025
OR
| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
For the transition period from to
Commission File Number: 1-34354
(Exact name of registrant as specified in its Charter)
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | ||||
(Address of principal executive offices)
(352 ) 2060 2055
(Registrant’s telephone number, including area code)
Securities registered or to be registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol | Name of each exchange on which registered | ||||||||||||
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer | ☐ | Accelerated filer | ☐ | |||||||||||||||||
| ☑ | Smaller reporting company | |||||||||||||||||||
| Emerging growth company | ||||||||||||||||||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑
As of October 17, 2025, there were 10,991,850 outstanding shares of the registrant’s common stock (excluding 29,106 shares held as treasury stock).
Table of Contents
Table of Contents
ALTISOURCE PORTFOLIO SOLUTIONS S.A.
FORM 10-Q
| Page | |||||||||||
PART I — Financial Information | |||||||||||
Item 1 | Interim Condensed Consolidated Financial Statements (Unaudited) | ||||||||||
Condensed Consolidated Balance Sheets | 3 | ||||||||||
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) | 4 | ||||||||||
Condensed Consolidated Statements of Equity (Deficit) | 5 | ||||||||||
Condensed Consolidated Statements of Cash Flows | 7 | ||||||||||
Notes to Condensed Consolidated Financial Statements | 9 | ||||||||||
Item 2 | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 36 | |||||||||
Item 3 | Quantitative and Qualitative Disclosures about Market Risk | 54 | |||||||||
Item 4 | Controls and Procedures | 55 | |||||||||
PART II — Other Information | |||||||||||
Item 1 | Legal Proceedings | 56 | |||||||||
Item 1A | Risk Factors | 56 | |||||||||
Item 2 | Unregistered Sales of Equity Securities and Use of Proceeds | # | |||||||||
Item 5 | Other Information | 57 | |||||||||
Item 6 | Exhibits | 58 | |||||||||
SIGNATURES | 59 | ||||||||||
2
Table of Contents
PART I — FINANCIAL INFORMATION
Item 1. Interim Condensed Consolidated Financial Statements (Unaudited)
ALTISOURCE PORTFOLIO SOLUTIONS S.A.
Condensed Consolidated Balance Sheets
(in thousands, except per share data)
| September 30, 2025 | December 31, 2024 | ||||||||||
| ASSETS | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | $ | |||||||||
Accounts receivable, net of allowance for credit losses of $ | |||||||||||
| Prepaid expenses and other current assets | |||||||||||
| Total current assets | |||||||||||
| Premises and equipment, net | |||||||||||
| Right-of-use assets under operating leases | |||||||||||
| Goodwill | |||||||||||
| Intangible assets, net | |||||||||||
| Deferred tax assets, net | |||||||||||
| Other assets | |||||||||||
| Total assets | $ | $ | |||||||||
| LIABILITIES AND DEFICIT | |||||||||||
| Current liabilities: | |||||||||||
| Accounts payable and accrued expenses | $ | $ | |||||||||
| Current portion of long-term debt | |||||||||||
| Deferred revenue | |||||||||||
| Other current liabilities | |||||||||||
| Total current liabilities | |||||||||||
| Long-term debt | |||||||||||
| Deferred tax liabilities, net | |||||||||||
| Other non-current liabilities | |||||||||||
Commitments, contingencies and regulatory matters (Note 21) | |||||||||||
| Deficit: | |||||||||||
Common stock ($ | |||||||||||
| Additional paid-in capital | |||||||||||
| Accumulated deficit | ( | ( | |||||||||
Treasury stock, at cost ( | ( | ( | |||||||||
| Altisource deficit | ( | ( | |||||||||
| Non-controlling interests | |||||||||||
| Total deficit | ( | ( | |||||||||
| Total liabilities and deficit | $ | $ | |||||||||
See accompanying notes to condensed consolidated financial statements.
3
Table of Contents
ALTISOURCE PORTFOLIO SOLUTIONS S.A.
Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income
(in thousands, except per share data)
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||||||
| Revenue | $ | $ | $ | $ | ||||||||||||||||||||||
| Cost of revenue | ||||||||||||||||||||||||||
| Gross profit | ||||||||||||||||||||||||||
| Selling, general and administrative expenses | ||||||||||||||||||||||||||
| Income from operations | ||||||||||||||||||||||||||
| Other income (expense), net: | ||||||||||||||||||||||||||
| Interest expense | ( | ( | ( | ( | ||||||||||||||||||||||
| Debt exchange transaction expenses | ( | ( | ||||||||||||||||||||||||
| Other income (expense), net | ||||||||||||||||||||||||||
| Total other income (expense), net | ( | ( | ( | ( | ||||||||||||||||||||||
| Loss before income taxes and non-controlling interests | ( | ( | ( | ( | ||||||||||||||||||||||
| Income tax (provision) benefit | ( | ( | ( | |||||||||||||||||||||||
| Net (loss) income | ( | ( | ( | |||||||||||||||||||||||
| Net income attributable to non-controlling interests | ( | ( | ( | ( | ||||||||||||||||||||||
| Net (loss) income attributable to Altisource | $ | ( | $ | ( | $ | $ | ( | |||||||||||||||||||
| (Loss) earnings per share: | ||||||||||||||||||||||||||
| Basic | $ | ( | $ | ( | $ | $ | ( | |||||||||||||||||||
| Diluted | $ | ( | $ | ( | $ | $ | ( | |||||||||||||||||||
| Weighted average shares outstanding: | ||||||||||||||||||||||||||
| Basic | ||||||||||||||||||||||||||
| Diluted | ||||||||||||||||||||||||||
| Comprehensive (loss) income: | ||||||||||||||||||||||||||
| Net (loss) income | $ | ( | $ | ( | $ | $ | ( | |||||||||||||||||||
| Comprehensive income attributable to non-controlling interests | ( | ( | ( | ( | ||||||||||||||||||||||
| Comprehensive (loss) income attributable to Altisource | $ | ( | $ | ( | $ | $ | ( | |||||||||||||||||||
See accompanying notes to condensed consolidated financial statements.
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ALTISOURCE PORTFOLIO SOLUTIONS S.A.
Condensed Consolidated Statements of Equity (Deficit)
(in thousands)
| Altisource Equity (Deficit) | |||||||||||||||||||||||||||||||||||||||||||||||
| Common stock | Additional paid-in capital | Accumulated Deficit | Treasury stock, at cost | Non-controlling interests | Total | ||||||||||||||||||||||||||||||||||||||||||
| Shares | |||||||||||||||||||||||||||||||||||||||||||||||
| Balance, December 31, 2023 | $ | $ | $ | ( | $ | ( | $ | $ | ( | ||||||||||||||||||||||||||||||||||||||
| Net loss | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||
| Distributions to non-controlling interest holders | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||
| Share-based compensation expense | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
| Exercise of warrants, net of costs | — | — | ( | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||
| Issuance of restricted share units and restricted shares | — | — | — | ( | — | ||||||||||||||||||||||||||||||||||||||||||
| Treasury shares withheld for the payment of tax on restricted share unit and restricted share issuances | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||
| Balance, March 31, 2024 | $ | $ | $ | ( | $ | ( | $ | $ | ( | ||||||||||||||||||||||||||||||||||||||
| Net loss | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||
| Distributions to non-controlling interest holders | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||
| Share-based compensation expense | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
| Issuance of restricted share units and restricted shares | — | — | — | ( | — | ||||||||||||||||||||||||||||||||||||||||||
| Treasury shares withheld for the payment of tax on restricted share unit and restricted share issuances | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||
| Balance, June 30, 2024 | $ | $ | $ | ( | $ | ( | $ | $ | ( | ||||||||||||||||||||||||||||||||||||||
| Net loss | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||
| Share-based compensation expense | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
| Exercise of warrants, net of costs | — | — | ( | ( | — | ||||||||||||||||||||||||||||||||||||||||||
| Issuance of restricted share units and restricted shares | — | — | — | ( | — | ||||||||||||||||||||||||||||||||||||||||||
| Treasury shares withheld for the payment of tax on restricted share unit and restricted share issuances | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||
| Balance, September 30, 2024 | $ | $ | $ | ( | $ | ( | $ | $ | ( | ||||||||||||||||||||||||||||||||||||||
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ALTISOURCE PORTFOLIO SOLUTIONS S.A.
Condensed Consolidated Statements of Equity (Deficit)
(in thousands)
| Altisource Equity (Deficit) | |||||||||||||||||||||||||||||||||||||||||||||||
| Common stock | Additional paid-in capital | Accumulated Deficit | Treasury stock, at cost | Non-controlling interests | Total | ||||||||||||||||||||||||||||||||||||||||||
| Shares | |||||||||||||||||||||||||||||||||||||||||||||||
| Balance, December 31, 2024 | $ | $ | $ | ( | $ | ( | $ | $ | ( | ||||||||||||||||||||||||||||||||||||||
| Net loss | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||
| Distributions to non-controlling interest holders | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||
| Share-based compensation expense | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
| Issuance of common stock, net of issuance costs | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||
| Exercise of warrants, net of costs | — | — | — | ( | — | ||||||||||||||||||||||||||||||||||||||||||
| Issuance of restricted share units and restricted shares | — | — | — | ( | — | ||||||||||||||||||||||||||||||||||||||||||
| Treasury shares withheld for the payment of tax on restricted share unit and restricted share issuances | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||
| Balance, March 31, 2025 | $ | $ | $ | ( | $ | ( | $ | $ | ( | ||||||||||||||||||||||||||||||||||||||
| Net income | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
| Distributions to non-controlling interest holders | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||
| Share-based compensation expense | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
| Issuance of common stock, net of issuance costs | — | — | ( | — | — | — | ( | ||||||||||||||||||||||||||||||||||||||||
| Issuance of restricted share units and restricted shares | — | — | — | ( | — | ||||||||||||||||||||||||||||||||||||||||||
| Treasury shares withheld for the payment of tax on restricted share unit and restricted share issuances | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||
| Purchase of fractional shares | — | — | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||||||||||
| Balance, June 30, 2025 | $ | $ | $ | ( | $ | ( | $ | $ | ( | ||||||||||||||||||||||||||||||||||||||
| Net loss | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||
| Distributions to non-controlling interest holders | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||
| Share-based compensation expense | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
| Issuance of common stock, net of issuance costs | — | — | ( | — | — | — | ( | ||||||||||||||||||||||||||||||||||||||||
| Issuance of restricted share units and restricted shares | — | — | — | ( | — | ||||||||||||||||||||||||||||||||||||||||||
| Treasury shares withheld for the payment of tax on restricted share unit and restricted share issuances | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||
| Exercise of warrants, net of costs | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
| Balance, September 30, 2025 | $ | $ | $ | ( | $ | ( | $ | $ | ( | ||||||||||||||||||||||||||||||||||||||
See accompanying notes to condensed consolidated financial statements.
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ALTISOURCE PORTFOLIO SOLUTIONS S.A.
Condensed Consolidated Statements of Cash Flows
(in thousands)
Nine months ended September 30, | |||||||||||
| 2025 | 2024 | ||||||||||
| Cash flows from operating activities: | |||||||||||
| Net income (loss) | $ | $ | ( | ||||||||
| Adjustments to reconcile net income (loss) to net cash used in operating activities: | |||||||||||
| Depreciation and amortization | |||||||||||
| Amortization of right-of-use assets under operating leases | |||||||||||
| Amortization of intangible assets | |||||||||||
| Paid-in-kind accrual | |||||||||||
| Share-based compensation expense | |||||||||||
| Bad debt expense | |||||||||||
| Amortization of debt premium | ( | ||||||||||
| Amortization of debt discount | |||||||||||
| Amortization of debt issuance costs | |||||||||||
| Deferred income taxes | |||||||||||
| Loss on disposal of fixed assets | |||||||||||
| Changes in operating assets and liabilities: | |||||||||||
| Accounts receivable | ( | ( | |||||||||
| Prepaid expenses and other current assets | ( | ||||||||||
| Other assets | |||||||||||
| Accounts payable and accrued expenses | ( | ||||||||||
| Current and non-current operating lease liabilities | ( | ( | |||||||||
| Other current and non-current liabilities | ( | ||||||||||
| Net cash used in operating activities | ( | ( | |||||||||
| Cash flows from investing activities: | |||||||||||
| Additions to premises and equipment | ( | ||||||||||
| Other investing activities | ( | ||||||||||
| Net cash used in investing activities | ( | ||||||||||
| Cash flows from financing activities: | |||||||||||
| Proceeds from revolving loan agreement | |||||||||||
| Proceeds from the Super Senior Facility | |||||||||||
| Proceeds from exercise of cash settle stakeholder warrants | |||||||||||
| Debt issuance costs | ( | ||||||||||
| Repayments of long-term debt | ( | ||||||||||
| Equity issuance costs | ( | ||||||||||
| Purchase of fractional shares | ( | ||||||||||
| Exercise of Warrants, net of costs | ( | ||||||||||
| Distributions to non-controlling interests | ( | ( | |||||||||
| Payments of tax withholding on issuance of restricted share units and restricted shares | ( | ( | |||||||||
| Net cash provided by (used in) financing activities | ( | ||||||||||
| Net decrease in cash, cash equivalents and restricted cash | ( | ( | |||||||||
| Cash, cash equivalents and restricted cash at the beginning of the period | |||||||||||
| Cash, cash equivalents and restricted cash at the end of the period | $ | $ | |||||||||
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ALTISOURCE PORTFOLIO SOLUTIONS S.A.
Condensed Consolidated Statements of Cash Flows
(in thousands)
Nine months ended September 30, | |||||||||||
| 2025 | 2024 | ||||||||||
| Supplemental cash flow information: | |||||||||||
| Interest paid | $ | $ | |||||||||
| Income taxes (refunded) paid, net | ( | ||||||||||
| Acquisition of right-of-use assets with operating lease liabilities | |||||||||||
| Reduction of right-of-use assets from operating lease modifications or reassessments | ( | ( | |||||||||
| Non-cash investing and financing activities: | |||||||||||
| Equity issued in exchange for debt reduction | |||||||||||
| The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the unaudited condensed consolidated balance sheets and the unaudited condensed consolidated statements of cash flows: | |||||||||||
| September 30, 2025 | September 30, 2024 | ||||||||||
| Cash and cash equivalents | $ | $ | |||||||||
| Restricted cash | |||||||||||
| Total cash, cash equivalents and restricted cash reported in the statements of cash flows | $ | $ | |||||||||
See accompanying notes to condensed consolidated financial statements.
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ALTISOURCE PORTFOLIO SOLUTIONS S.A.
Notes to Condensed Consolidated Financial Statements
NOTE 1 — ORGANIZATION AND BASIS OF PRESENTATION
Description of Business
Altisource Portfolio Solutions S.A., together with its subsidiaries (which may be referred to as “Altisource,” the “Company,” “we,” “us” or “our”), is an integrated service provider and marketplace for the real estate and mortgage industries. Combining operational excellence with a suite of innovative services and technologies, Altisource helps solve the demands of the ever-changing markets we serve.
We are publicly traded on the NASDAQ Global Select Market under the symbol “ASPS.” We are organized under the laws of the Grand Duchy of Luxembourg.
We conduct our operations through two reportable segments: Servicer and Real Estate and Origination. In addition, we report Corporate and Others separately (see Note 22 for a description of our business segments).
Basis of Accounting and Presentation
The unaudited interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Securities and Exchange Commission (“SEC”) Regulation S-X. Accordingly, these financial statements do not include all of the information and footnotes required by GAAP for complete consolidated financial statements. In the opinion of management, the interim data includes all normal recurring adjustments considered necessary to fairly state the results for the interim periods presented. The preparation of interim condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of our interim condensed consolidated financial statements, as well as the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. Intercompany transactions and accounts have been eliminated in consolidation. Certain prior year balance sheet amounts have been reclassified for consistency with the current year presentation.
Altisource consolidates Best Partners Mortgage Cooperative, Inc., which is managed by The Mortgage Partnership of America, L.L.C. (“MPA”), a wholly-owned subsidiary of Altisource. Best Partners Mortgage Cooperative, Inc. is a mortgage cooperative doing business as Lenders One® (“Lenders One”). MPA provides services to Lenders One under a management agreement that ends on December 31, 2025 (with renewals for three successive five-year periods at MPA’s option).
These interim condensed consolidated financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2024, as filed with the SEC on March 31, 2025.
Share Consolidation
On May 28, 2025, Altisource Portfolio Solutions S.A. effected a consolidation of its shares of common stock (the “common stock”) (also known as a reverse stock split) at a ratio of 1-for-8 (the “Share Consolidation”). As a result of the Share Consolidation, every 8 shares of common stock outstanding immediately prior to effectiveness of the Share Consolidation were combined and converted into one share of common stock, reducing the total number of issued and outstanding shares from 88,129,766 11,016,220
The Share Consolidation did not change the authorized number of shares of Altisource’s common stock.
All share and per share amounts and exercise prices of stock options, and warrants in the accompanying condensed consolidated financial statements and notes to the condensed consolidated financial statements have been retroactively adjusted to reflect the Share Consolidation for all periods presented.
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ALTISOURCE PORTFOLIO SOLUTIONS S.A.
Notes to Condensed Consolidated Financial Statements (Continued)
Fair Value Measurements
Fair value is defined as an exit price, representing the amount that would be received for an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The three-tier hierarchy for inputs used in measuring fair value, which prioritizes the inputs used in the methodologies of measuring fair value for assets and liabilities, is as follows:
Level 1 — Quoted prices in active markets for identical assets and liabilities
Level 2 — Observable inputs other than quoted prices included in Level 1
Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of assets or liabilities
Financial assets and financial liabilities are classified based on the lowest level of input that is significant to the fair value measurements. Our assessment of the significance of a particular input to the fair value measurements requires judgment and may affect the valuation of the assets and liabilities being measured and their placement within the fair value hierarchy.
Recently Adopted Accounting Pronouncements
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. This standard amends the Codification to enhance the transparency and decision usefulness of income tax disclosures, to provide information to better assess how an entity’s operations and related tax risks and tax planning and operational opportunities affect its tax rate and prospects for future cash flows. The Company adopted this standard effective January 1, 2025 and has applied it prospectively. Adoption of this new standard did not have a material impact on the Company’s condensed consolidated financial statements.
Future Adoption of New Accounting Pronouncement
In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40). This standard amends the Codification to enhance the disclosure requirements in the notes to the financial statements, of specified information about certain costs and expenses in interim and year-end reporting periods. This standard will be effective for annual periods beginning after December 15, 2026, and for interim periods beginning after December 15, 2027. Early adoption of this standard is permitted. The Company is currently evaluating the impact this guidance may have on its condensed consolidated financial statements.
In July 2025, the FASB issued ASU 2025-05, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets. This standard provides a practical expedient to assume that conditions as of the balance sheet date remains unchanged over the life of the asset estimating expected credit losses for current accounts receivable and current contract assets arising from transactions accounted for under Topic 606. This standard will be effective for annual periods beginning after December 15, 2025, and for interim periods within those annual reporting periods. Early adoption of this standard is permitted. The Company is currently evaluating the impact this guidance may have on its condensed consolidated financial statements.
In September 2025, the FASB issued ASU 2025-07, Derivatives and Hedging (Topic 815) and Revenue from Contracts with Customers (Topic 606): Derivatives Scope Refinements and Scope Clarification for Share-Based Noncash Consideration from a Customer in a Revenue Contract. This standard adds a new derivative scope exception for certain non-exchange-traded contracts whose underlying is based on operations or activities specific to one party, and clarifies that share-based payments received from a customer in a revenue contract should be accounted for under ASC 606 until the entity’s right to receive or retain them is unconditional. This standard will be effective for annual periods beginning after December 15, 2026, and for interim periods within those annual reporting periods. Early adoption of this standard is permitted. The Company is currently evaluating the impact this guidance may have on its condensed consolidated financial statements.
NOTE 2 — CUSTOMER CONCENTRATION
Onity
Onity Group Inc. (together with its subsidiaries, “Onity”) (formerly Ocwen Financial Corporation, or “Ocwen”) is a residential mortgage loan servicer of mortgage servicing rights (“MSRs”) it owns, including those MSRs in which others have an economic interest, and a subservicer of loans owned by others.
During the three and nine months ended September 30, 2025, Onity was our largest customer, accounting for 42 % and 43 %, respectively, of our total revenue. Onity purchases certain mortgage services from us under the terms of services agreements
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ALTISOURCE PORTFOLIO SOLUTIONS S.A.
Notes to Condensed Consolidated Financial Statements (Continued)
and amendments thereto (collectively, the “Onity Services Agreements”) with terms extending through August 2030. Certain of the Onity Services Agreements contain a “most favored nation” provision and also grant the parties the right to renegotiate pricing, among other things.
Revenue from Onity primarily consists of revenue earned from the loan portfolios serviced and subserviced by Onity when Onity engages us as the service provider, and revenue earned directly from Onity, pursuant to the Onity Services Agreements. For the nine months ended September 30, 2025 and 2024, we recognized revenue from Onity of $55.5 million and $52.6 million, respectively ($17.7 million and $17.6 million for the third quarter of 2025 and 2024, respectively). Revenue from Onity as a percentage of segment and consolidated revenue was as follows:
| Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||||||
| Servicer and Real Estate | % | % | % | % | ||||||||||||||||||||||
| Origination | % | % | % | % | ||||||||||||||||||||||
| Corporate and Others | % | % | % | % | ||||||||||||||||||||||
| Consolidated revenue | % | % | % | % | ||||||||||||||||||||||
We earn additional revenue related to the portfolios serviced and subserviced by Onity when a party other than Onity or the MSR owner selects Altisource as the service provider. For the nine months ended September 30, 2025 and 2024, we recognized $5.9 million and $7.5 million, respectively ($1.9 million and $2.3 million for the third quarter of 2025 and 2024, respectively), of such revenue. These amounts are not included in deriving revenue from Onity and revenue from Onity as a percentage of revenue discussed above.
As of September 30, 2025, accounts receivable from Onity totaled $5.1 million, $2.7 million of which was billed and $2.4 million of which was unbilled. As of December 31, 2024, accounts receivable from Onity totaled $4.4 million, $3.1 million of which was billed and $1.3 million of which was unbilled.
Rithm
Rithm Capital Corp. (individually, together with one or more of its subsidiaries or one or more of its subsidiaries individually, “Rithm”) is an asset manager focused on the real estate and financial services industries.
Onity has disclosed that Rithm is one of its largest servicing clients. As of June 30, 2025, Onity reported that approximately 11 % of loans serviced and subserviced by Onity (measured in unpaid principal balance (“UPB”)) and approximately 59 % of all delinquent loans that Onity services were related to Rithm MSRs or rights to MSRs (the “Subject MSRs”).
Rithm purchased brokerage services for real estate owned (“REO”) exclusively from us, irrespective of the subservicer, subject to certain limitations, for certain MSRs set forth in and pursuant to the terms of a Cooperative Brokerage Agreement, as amended, and related letter agreement (collectively, the ‘Rithm Brokerage Agreement”) through August 2025. The Rithm Brokerage Agreement expired on August 31, 2025. At Rithm’s discretion, Altisource has continued to manage REO and receive referrals with limited exceptions from portfolios previously subject to the Rithm Brokerage Agreement despite the expiration of the Rithm Brokerage Agreement. In addition, Rithm also purchases property inspection, preservation and other services from us pursuant to other agreements.
For the nine months ended September 30, 2025 and 2024, we recognized revenue from Rithm of $3.3 million and $1.8 million, respectively ($1.5 million and $0.5 million for the third quarter of 2025 and 2024, respectively), under the Rithm Brokerage Agreement and other agreements. For the nine months ended September 30, 2025 and 2024, we recognized additional revenue of $7.5 million and $8.6 million, respectively ($2.2 million and $2.5 million for the third quarter of 2025 and 2024, respectively), relating to the Subject MSRs when a party other than Rithm selected us as the service provider.
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ALTISOURCE PORTFOLIO SOLUTIONS S.A.
Notes to Condensed Consolidated Financial Statements (Continued)
NOTE 3 — ACCOUNTS RECEIVABLE, NET
Accounts receivable, net consists of the following:
| (in thousands) | September 30, 2025 | December 31, 2024 | ||||||||||||
| Billed | $ | $ | ||||||||||||
| Unbilled | ||||||||||||||
| Less: Allowance for credit losses | ( | ( | ||||||||||||
| Total | $ | $ | ||||||||||||
Billed accounts receivable includes receivables from certain real estate asset management services, REO and foreclosure sales, and title and closing services, for which we generally recognize revenue when the service is provided but collect upon closing of the sale. Unbilled accounts receivable also includes receivables from foreclosure trustee services and property renovation services, for which we generally recognize revenues over the service delivery period but bill following completion of the service. We also include amounts in unbilled accounts receivable that are earned during a month and billed in the following month. As of January 1, 2025, gross accounts receivable totaled $18.2 million, $12.2 million of which was billed and $6.0 million of which was unbilled, less allowance for credit losses of $3.1 million, resulting in net accounts receivable of $15.1 million. As of January 1, 2024, gross accounts receivable totaled $14.8 million, $11.2 million of which was billed and $3.6 million of which was unbilled, less allowance for credit losses of $3.1 million, resulting in net accounts receivable of $11.7 million.
We are exposed to credit losses through our sales of products and services to our customers which are recorded as accounts receivable, net on the Company’s condensed consolidated financial statements. We monitor and estimate the allowance for credit losses based on our historical write-offs, historical collections, our analysis of past due accounts based on the contractual terms of the receivables, relevant market and industry reports and our assessment of the economic status of our customers, if known. Estimated credit losses are written off in the period in which the financial asset is determined to be no longer collectible. There can be no assurance that actual results will not differ from estimates or that consideration of these factors in the future will not result in an increase or decrease to our allowance for credit losses.
Changes in the allowance for expected credit losses consist of the following:
| (Additions) / Subtractions | ||||||||||||||||||||||||||||||||
| (in thousands) | Balance at Beginning of Period | Charged to Expenses | Deductions Note(1) | Balance at End of Period | ||||||||||||||||||||||||||||
Allowance for expected credit losses: | ||||||||||||||||||||||||||||||||
Three months ended September 30, 2025 | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||
Three months ended September 30, 2024 | ( | |||||||||||||||||||||||||||||||
Nine months ended September 30, 2025 | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||
Nine months ended September 30, 2024 | ( | |||||||||||||||||||||||||||||||
______________________________________
(1) Amounts written off as uncollectible or transferred to other accounts or utilized.
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ALTISOURCE PORTFOLIO SOLUTIONS S.A.
Notes to Condensed Consolidated Financial Statements (Continued)
NOTE 4 — PREPAID EXPENSES AND OTHER CURRENT ASSETS
Prepaid expenses and other current assets consist of the following:
| (in thousands) | September 30, 2025 | December 31, 2024 | ||||||||||||
| Prepaid expenses | $ | $ | ||||||||||||
| Maintenance agreements, current portion | ||||||||||||||
| Income taxes receivable | ||||||||||||||
| Restricted cash | ||||||||||||||
| Surety bond collateral | ||||||||||||||
| Other current assets | ||||||||||||||
| Total | $ | $ | ||||||||||||
NOTE 5 — PREMISES AND EQUIPMENT, NET
Premises and equipment, net consists of the following:
| (in thousands) | September 30, 2025 | December 31, 2024 | ||||||||||||
| Computer hardware and software | $ | $ | ||||||||||||
| Leasehold improvements | ||||||||||||||
| Furniture and fixtures | ||||||||||||||
| Office equipment and other | ||||||||||||||
| Less: Accumulated depreciation and amortization | ( | ( | ||||||||||||
| Total | $ | $ | ||||||||||||
Depreciation and amortization expense amounted to $0.4 million and $0.8 million for the nine months ended September 30, 2025 and 2024, respectively ($0.1 million and $0.2 million for the third quarter of 2025 and 2024, respectively), and is included in cost of revenue for operating assets and in selling, general and administrative expenses for non-operating assets in the accompanying condensed consolidated statements of operations and comprehensive (loss) income.
Premises and equipment, net consist of the following by country:
| (in thousands) | September 30, 2025 | December 31, 2024 | ||||||||||||
| Luxembourg | $ | $ | ||||||||||||
| India | ||||||||||||||
| United States | ||||||||||||||
| Uruguay | ||||||||||||||
| Total | $ | $ | ||||||||||||
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ALTISOURCE PORTFOLIO SOLUTIONS S.A.
Notes to Condensed Consolidated Financial Statements (Continued)
NOTE 6 — RIGHT-OF-USE ASSETS UNDER OPERATING LEASES, NET
Right-of-use assets under operating leases, net consists of the following:
| (in thousands) | September 30, 2025 | December 31, 2024 | ||||||||||||
| Right-of-use assets under operating leases | $ | $ | ||||||||||||
| Less: Accumulated amortization | ( | ( | ||||||||||||
| Total | $ | $ | ||||||||||||
Amortization of operating leases was $0.9 million and $1.2 million for the nine months ended September 30, 2025 and 2024, respectively ($0.4 million and $0.4 million for the third quarter of 2025 and 2024, respectively), and is included in cost of revenue for operating assets and in selling, general and administrative expenses for non-operating assets in the accompanying condensed consolidated statements of operations and comprehensive (loss) income.
NOTE 7 — GOODWILL AND INTANGIBLE ASSETS, NET
Goodwill
The following is a summary of goodwill by segment:
| (in thousands) | Servicer and Real Estate | Origination | Corporate and Others | Total | ||||||||||||||||||||||
Balance as of September 30, 2025 and December 31, 2024 | $ | $ | $ | $ | ||||||||||||||||||||||
Intangible Assets, net
Intangible assets, net consist of the following:
Weighted average estimated useful life (in years) | Gross carrying amount | Accumulated amortization | Net book value | |||||||||||||||||||||||||||||||||||||||||
| (in thousands) | September 30, 2025 | December 31, 2024 | September 30, 2025 | December 31, 2024 | September 30, 2025 | December 31, 2024 | ||||||||||||||||||||||||||||||||||||||
| Definite lived intangible assets: | ||||||||||||||||||||||||||||||||||||||||||||
| Customer related intangible assets | $ | $ | $ | ( | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||||
| Operating agreement | ( | ( | ||||||||||||||||||||||||||||||||||||||||||
| Trademarks and trade names | ( | ( | ||||||||||||||||||||||||||||||||||||||||||
| Total | $ | $ | $ | ( | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||||
Amortization expense for definite lived intangible assets was $3.8 million and $3.8 million for the nine months ended September 30, 2025 and 2024, respectively ($1.3 million and $1.3 million for the third quarter of 2025 and 2024, respectively). Forecasted annual definite lived intangible asset amortization expense for 2025 through 2029 is $5.1 million, $4.9 million, $4.7 million, $4.4 million and $2.1 million, respectively.
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ALTISOURCE PORTFOLIO SOLUTIONS S.A.
Notes to Condensed Consolidated Financial Statements (Continued)
NOTE 8 — OTHER ASSETS
Other assets consist of the following:
| (in thousands) | September 30, 2025 | December 31, 2024 | ||||||||||||
| Restricted cash | $ | $ | ||||||||||||
| Surety bond collateral | ||||||||||||||
| Security deposits | ||||||||||||||
| Other | ||||||||||||||
| Total | $ | $ | ||||||||||||
NOTE 9 — ACCOUNTS PAYABLE, ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES
Accounts payable and accrued expenses consist of the following:
| (in thousands) | September 30, 2025 | December 31, 2024 | ||||||||||||
| Accounts payable | $ | $ | ||||||||||||
| Accrued expenses - general | ||||||||||||||
| Accrued salaries and benefits | ||||||||||||||
| Income taxes payable | ||||||||||||||
| Total | $ | $ | ||||||||||||
Other current liabilities consist of the following:
| (in thousands) | September 30, 2025 | December 31, 2024 | ||||||||||||
| Operating lease liabilities | $ | $ | ||||||||||||
| Revolving loan agreement | ||||||||||||||
| Other | ||||||||||||||
| Total | $ | $ | ||||||||||||
Revolving Loan Agreement
On June 3, 2024, in connection with the Company’s Property Renovation Services business, Altisource Solutions, Inc., an indirect subsidiary of Altisource Portfolio Solutions S.A, entered into a revolving loan agreement with a then related-party, Altisource Asset Management Corporation (“AAMC”) (the “Revolving Loan Agreement”).
Under the terms of the Revolving Loan Agreement, AAMC will make loans to Altisource from time to time, as may be requested by Altisource. The Revolving Loan Agreement provides Altisource the ability to borrow an initial aggregate amount of up to $1.0 million, with the potential for this to be increased up to $3.0 million at the option of AAMC. Amounts that are repaid may be re-borrowed in accordance with the limitations set forth below.
The maturity date of the Revolving Loan Agreement was June 3, 2025 and can be automatically extended for one year on each anniversary of the maturity date. During any extension period, AAMC may terminate the Revolving Loan Agreement upon 150 days prior written notice and the loan will mature upon such termination. During the second quarter of 2025, the Revolving Loan Agreement maturity date was extended to June 3, 2026.
Borrowings under the Revolving Loan Agreement bear interest of 12.00 % per annum in cash and are payable monthly in arrears on the first business day of each calendar month. Altisource pays AAMC a monthly unused commitment fee in an amount equal to 0.25 % per annum of the average amount of the unused available credit under the Revolving Loan Agreement.
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ALTISOURCE PORTFOLIO SOLUTIONS S.A.
Notes to Condensed Consolidated Financial Statements (Continued)
Altisource’s obligation under the Revolving Loan Agreement is secured by certain receivables related to the Company’s residential real estate renovation services business. The outstanding balance on the Revolving Loan Agreement is due and payable on the maturity date.
As of September 30, 2025 and December 31, 2024, there was $1.0
NOTE 10 — LONG-TERM DEBT
Long-term debt consists of the following:
| (in thousands) | September 30, 2025 | December 31, 2024 | ||||||||||||
| Senior secured term loans | $ | $ | ||||||||||||
| Super senior term loan | ||||||||||||||
| Total principal debt | ||||||||||||||
| Plus: Unamortized premium | ||||||||||||||
| Less: Unamortized discount | ( | ( | ||||||||||||
| Less: Unamortized debt issuance and amendment costs | ( | ( | ||||||||||||
| Long-term debt, net | ||||||||||||||
| Less: Current maturities of long-term debt | ( | ( | ||||||||||||
| Total long-term debt | $ | $ | ||||||||||||
Principal payments are due as follows:
| (in thousands) | Total | ||||
| 2025 | $ | ||||
| 2026 | |||||
| 2027 | |||||
| 2028 | |||||
| 2029 | |||||
| 2030 | |||||
| Total debt | $ | ||||
Senior Secured Term Loans
In April 2018, Altisource Portfolio Solutions S.A. and its wholly-owned subsidiary, Altisource S.à r.l. (the “Borrower”), entered into a credit agreement with Morgan Stanley Senior Funding, Inc., as administrative agent and collateral agent, and certain lenders (the “Credit Agreement”). Under the Credit Agreement, Altisource borrowed $412 million in the form of senior secured term loans (the “SSTL”). Effective February 14, 2023, Altisource Portfolio Solutions S.A. and Altisource S.à r.l. entered into Amendment No. 2 to the Credit Agreement (as amended by Amendment No. 2, the “Amended Credit Agreement”).
On February 19, 2025, Altisource Portfolio Solutions S.A. and the Borrower entered into agreements with 100% of the lenders under the SSTL (the “Lenders”). Under these agreements, the Lenders exchanged the SSTL with an outstanding balance of $232.8 million for a $160.0 million new first lien loan facility (the “New Facility”) and 7.3 million shares of common stock (the “Debt Exchange Shares”) (collectively, the “Debt Exchange Transaction”). The New Facility is comprised of a $110.0 million interest-bearing loan (the “New Debt”) and a $50.0 million non-interest-bearing exit fee (the “Exit Fee”). Altisource Portfolio Solutions S.A. and its subsidiaries, subject to applicable exclusions in the New Facility credit agreement, are guarantors on the New Facility (collectively, the “Guarantors”).
We evaluated the Debt Exchange Transaction in accordance with ASC 470-60 Troubled Debt Restructuring. The evaluation for troubled debt restructuring includes assessing both qualitative and quantitative factors to determine whether the creditor granted a concession and whether the Company is experiencing financial difficulties. Our quantitative analysis consisted of comparing the effective borrowing rate on the New Facility to the effective borrowing rate on the SSTL immediately before the Debt Exchange Transaction. For purposes of ASC 470-60 Troubled Debt Restructuring, the Company concluded that (1) the lenders granted the Company a concession by reducing the effective borrowing rate on the debt and (2) the Company was experiencing
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ALTISOURCE PORTFOLIO SOLUTIONS S.A.
Notes to Condensed Consolidated Financial Statements (Continued)
financial difficulties. As a result, the Debt Exchange Transaction was accounted for as a troubled debt restructuring. The carrying value of the New Facility was determined as follows:
| (in thousands) | Total | ||||
| SSTL immediately before the Debt Exchange Transaction | $ | ||||
| Unamortized debt issuance costs and discount immediately before the Debt Exchange Transaction | ( | ||||
| Less: fair value of equity issued to the SSTL lenders | ( | ||||
| Less: fees paid to third parties on behalf of the SSTL lenders | ( | ||||
| Carrying value of the New Facility | $ | ||||
| Comprised of: | |||||
| Par value of the New Facility | $ | ||||
| Premium | |||||
| Unamortized debt issuance costs and discount | ( | ||||
| Carrying value of the New Facility | $ | ||||
In connection with the Debt Exchange Transaction, the Company also paid $3.6 million to advisors and others and recorded these payments as other expense in the consolidated statements of operations and comprehensive (loss) income.
The maturity date for $158.1 million of the New Facility is April 30, 2030 and the maturity date for $1.4 million of the New Facility is January 15, 2029.
The New Facility requires mandatory prepayments of the term loans, subject to customary exceptions, as follows: (i) 100 % of the proceeds of any other debt not permitted by the Exchange Credit Agreement, (ii) 95 % of the net proceeds from the exercise of the Cash Exercise Stakeholder Warrants, (iii) 100 % of the proceeds of Asset Sales, subject to customary reinvestment rights for net proceeds of less than $3 million and certain exceptions, where applicable, (iv) 100 % of insurance or condemnation proceeds in excess of $10,000,000 in the aggregate for all losses in any fiscal year, subject to customary reinvestment rights, where applicable, and (v) beginning with the fiscal year ending December 31, 2025, the lesser of (a) 75 % of the aggregate Excess Cash Flow for the most recently ended fiscal year of the Borrower for which financial statements have been delivered and (b) such amount which, immediately after giving effect to such repayment, would result in the Borrower and its subsidiaries having no less than $30 million of cash, shall be applied first to the prepayment of the Super Senior Facility (defined below) and, second, to the prepayment of the New Facility. All mandatory and voluntary prepayments under the New Facility are allocated between the New Debt and the Exit Fee on a pro rata basis.
All amounts outstanding under the New Facility will become due on the earlier of (i) the maturity date, and (ii) the date on which the loans are declared to be due and owing by the administrative agent at the request (or with the consent) of the Required Lenders (as defined in the New Facility credit agreement; other capitalized terms, unless defined herein, are defined in the New Facility credit agreement) or as otherwise provided in the New Facility credit agreement upon the occurrence of any event of default.
The New Debt bears interest at rates based upon, at our option, the Secured Overnight Financing Rate (“SOFR”) or the Base Rate, as defined in the New Facility credit agreement. SOFR-based term loans bear interest at a rate per annum equal to SOFR plus 6.50 % (with a 3.50 % SOFR floor) payable in cash. Base Rate-based term loans bear interest at a rate per annum equal to the Base Rate plus 5.50 % payable in cash. The interest rate on the SSTL from January 1, 2025 through February 19, 2025 was SOFR plus 5.00 % payable in cash. The interest rate on the SSTL in 2024 was SOFR plus 5.00 % payable in cash plus 3.75 % payable in kind. The interest rate as of September 30, 2025 was 10.90 %.
The payment of all amounts owing by the Borrower under the New Facility credit agreement is guaranteed by the Guarantors and is secured by a lien on substantially all of the assets of the Borrower, Altisource and the other Guarantors, subject to certain exceptions. The liens securing the New Facility are junior to the liens securing the Super Senior Facility (defined below) pursuant to, and as set forth in, an intercreditor agreement.
The New Facility contains representations, warranties, covenants, term and conditions customary for transactions of this type. This include covenants limiting Altisource, the Borrower and its subsidiaries, subject to certain exceptions and baskets, to (i) incur indebtedness, (ii) incur liens on its assets, (iii) agree to additional negative pledges, (iv) make Restricted Junior Payments, (v) pay dividends or distribute assets, (vi) make investments, (vii) enter into any transaction of merger or consolidation, liquidate, wind-up or dissolve, or convey any part of its business, assets or property, or acquire the business, property or assets of another person, (viii) dispose of the equity interests of any Significant Subsidiaries, (ix) enter into sale and leaseback
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ALTISOURCE PORTFOLIO SOLUTIONS S.A.
Notes to Condensed Consolidated Financial Statements (Continued)
transactions, (x) enter into certain transactions with shareholders and affiliates, (xi) engage in a line of business substantially different than existing business and businesses reasonably related, complimentary or ancillary thereto, (xii) modify the terms of certain indebtedness, (xiii) modify the terms of its organizational documents, (xiv) change its fiscal year, and (xv) enter into any transactions undertaken in connection with a Liability Management Transaction.
The New Facility contains certain events of default including (i) failure to pay (x) principal when due or (y) interest or any other amount owing on any other obligation under the Credit Agreement within 5 days of becoming due, (ii) material incorrectness of representations and warranties when made, (iii) breach of certain other covenants, subject to cure periods described therein, (iv) failure to pay principal or interest on any other debt that equals or exceeds $10 million when due, (v) default on any other debt that equals or exceeds $10 million that causes, or gives the holder or holders of such debt the ability to cause, an acceleration of such debt, (vi) bankruptcy and insolvency events with respect to Altisource, Borrower or any Material Subsidiary, (vii) entry by a court of one or more judgments against Altisource, Borrower or any Material Subsidiary in an amount in excess of $15 million that remain undischarged, unvacated, unbonded or unstayed for a certain number of days after the entry thereof, (viii) the occurrence of certain ERISA events, (ix) occurrence of a Change in Control, (x) the failure of certain Loan Documents to be in full force and effect or Altisource or any Guarantor challenges the validity of any such Loan Document, (xi) the termination of certain material contracts and (xii) failure to comply in any material respects with the terms of the Shareholder Warrants or the Warrant Agreement. If any event of default occurs and is not cured within applicable grace periods set forth in the Exchange Credit Agreement or waived, all loans and other obligations could become due and immediately payable.
Deer Park Road Management Company, LP (together with its affiliates and managed funds, “Deer Park”), a related party, owns approximately 13 % and 16 % of Altisource’s common stock as of September 30, 2025 and December 31, 2024, respectively, and $19.9 million and $42.1 million of Altisource debt as of September 30, 2025 and December 31, 2024, respectively. An employee of Deer Park is a member of Altisource’s Board of Directors. During the nine months ended September 30, 2025 and 2024, Deer Park received interest of $1.5 million and $1.1 million, respectively ($0.4 million and $0.4 million for the third quarter of 2025 and 2024, respectively). On April 3, 2025, Deer Park received Stakeholder Warrants to purchase 1.9 million shares of Altisource common stock for $9.5998 per share.
During the first quarter of 2025, UBS Asset Management (Americas) LLC (together with its affiliates and managed funds, “UBS”) and Benefit Street Partners L.L.C. (together with its affiliates and managed funds, “Benefit Street”) became related parties of Altisource. As of September 30, 2025, UBS owns approximately 22 % of Altisource’s common stock and $63.9 million of Altisource debt. During the three and nine months ended September 30, 2025, UBS received interest of $1.3 million and $4.2 million, respectively. On April 3, 2025, UBS received Stakeholder Warrants to purchase 0.2 million shares of Altisource common stock for $9.5998 per share.
As of September 30, 2025, Benefit Street owns approximately 16 % of Altisource’s common stock and $30.9 million of Altisource debt. During the three and nine months ended September 30, 2025, Benefit Street received interest of $0.6 million and $1.6 million, respectively. On April 3, 2025, Benefit Street received Stakeholder Warrants to purchase 2.2 million shares of Altisource common stock for $9.5998 per share.
For additional information on the Stakeholder Warrants, see Note 11.
As of September 30, 2025, debt issuance and amendment costs were $1.0 million, net of $9.0 million of accumulated amortization. As of December 31, 2024, debt issuance and amendment costs were $0.9 million, net of $8.5 million of accumulated amortization.
Super Senior Credit Facility
On February 19, 2025, Altisource Portfolio Solutions S.A. and the Borrower also entered into a $12.5 million super senior credit facility (the “Super Senior Facility”) to fund transaction costs related to the Transactions (defined above) and for general corporate purposes. The maturity date of the Super Senior Facility is February 19, 2029. The original issue discount on the Super Senior Facility is 10.0 %.
Beginning with the fiscal year ending December 31, 2025, the lesser of (a) 75 % of the aggregate Excess Cash Flow (as defined in the credit agreement) for the most recently ended fiscal year of the Company for which financial statements have been delivered and (b) such amount which, immediately after giving effect to such repayment, would result in the Company having no less than $30 million of total cash on its balance sheet, shall be applied first to the prepayment of the Super Senior Facility and, second, to the prepayment of the New Facility.
The payment of all amounts owing by the Borrower under the Super Senior Credit Agreement is guaranteed by the Guarantors and is secured by a lien on substantially all of the assets of Altisource and the Guarantors, subject to certain exceptions. The
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ALTISOURCE PORTFOLIO SOLUTIONS S.A.
Notes to Condensed Consolidated Financial Statements (Continued)
liens securing the Super Senior Facility are senior to the liens securing the New Facility pursuant to, and as set forth in, the Super Senior Intercreditor Agreement.
The Super Senior Credit Agreement contains representations, warranties, covenants, terms and conditions customary for transactions of this type. These include covenants limiting Altisource Portfolio Solutions S.A., the Borrower and their subsidiaries, subject to certain exceptions and baskets, to (i) incur indebtedness, (ii) incur liens on its assets, (iii) agree to additional negative pledges, (iv) make Restricted Junior Payments, (v) pay dividends or distribute assets, (vi) make investments, (vii) enter into any transaction of merger or consolidation, liquidate, wind-up or dissolve, or convey any part of its business, assets or property, or acquire the business, property or assets of another person, (viii) dispose of the equity interests of any Significant Subsidiaries, (ix) enter into sale and leaseback transactions, (x) enter into certain transactions with shareholders and affiliates, (xi) engage in a line of business substantially different than existing business and businesses reasonably related, complimentary or ancillary thereto, (xii) modify the terms of certain indebtedness, (xiii) modify the terms of its organizational documents, (xiv) change its fiscal year, and (xv) enter into any transactions undertaken in connection with a Liability Management Transaction. The Super Senior Credit Agreement also requires that the Borrower maintain minimum daily liquidity of not less than the lesser of (a) $12.5 million and (b) the aggregate principal amount of Term Loans under the Super Senior Facility outstanding on such date.
The Super Senior Credit Agreement requires mandatory prepayments of the term loans, subject to customary exceptions, as follows: (i) 100 % of the proceeds of any other debt not permitted by the Super Senior Credit Agreement, (ii) 95 % of the proceeds from the exercise of the Cash Exercise Stakeholder Warrants, (iii) 100 % of the proceeds of Asset Sales, subject to customary reinvestment rights for net proceeds of less than $3 million and certain exceptions, where applicable, (iv) 100 % of insurance or condemnation proceeds in excess of $10,000,000 in the aggregate for all losses in any fiscal year, subject to customary reinvestment rights, where applicable, and (v) beginning with the fiscal year ending December 31, 2025, the lesser of (a) 75 % of the aggregate Excess Cash Flow for the most recently ended fiscal year of the Borrower for which financial statements have been delivered and (b) such amount which, immediately after giving effect to such repayment, would result in the Borrower and its subsidiaries having no less than $30 million of cash.
All amounts outstanding under the Super Senior Credit Agreement will become due on the earlier of (i) the maturity date, and (ii) the date on which the loans are declared to be due and owing by the administrative agent at the request (or with the consent) of the Required Lenders (as defined in the Super Senior Credit Agreement; other capitalized terms, unless defined herein, are defined in the Super Senior Credit Agreement) or as otherwise provided in the Super Senior Credit Agreement upon the occurrence of any event of default.
The Super Senior Credit Facility bears interest at rates based upon, at our option, the SOFR or the Base Rate, as defined in the Super Senior Credit Agreement. SOFR-based term loans bear interest at a rate per annum equal to SOFR plus 6.50 % (with a 3.50 % SOFR floor) payable in cash. Base Rate-based term loans bear interest at a rate per annum equal to the Base Rate plus 5.50 % payable in cash. The interest rate as of September 30, 2025 was 10.90 %.
The Super Senior Credit Agreement contains certain events of default, including (i) failure to pay (x) principal when due or (y) interest or any other amount owing on any other obligation under the Credit Agreement within 5 days of becoming due, (ii) material incorrectness of representations and warranties when made, (iii) breach of certain other covenants, subject to cure periods described therein, (iv) failure to pay principal or interest on any other debt that equals or exceeds $10 million when due, (v) default on any other debt that equals or exceeds $10 million that causes, or gives the holder or holders of such debt the ability to cause, an acceleration of such debt, (vi) bankruptcy and insolvency events with respect to Altisource, Borrower or any Material Subsidiary, (vii) entry by a court of one or more judgments against Altisource, Borrower or any Material Subsidiary in an amount in excess of $15 million that remain undischarged, unvacated, unbonded or unstayed for a certain number of days.
Revolver
On June 22, 2021, Altisource S.à r.l; a subsidiary of Altisource Portfolio Solutions S.A., entered into a revolving credit facility with STS Master Fund, Ltd. (“STS”) (the “Revolver”). STS is an investment fund managed by Deer Park. The Revolver was amended effective February 14, 2023.
On February 19, 2025, Altisource entered into an agreement to terminate the $15.0 million Revolver with STS. As of December 31, 2024, the Company did not have any borrowings outstanding under the Revolver.
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ALTISOURCE PORTFOLIO SOLUTIONS S.A.
Notes to Condensed Consolidated Financial Statements (Continued)
NOTE 11 — WARRANTS
Penny Warrants
On February 14, 2023, the lenders under the Amended Credit Agreement (see Note 10 for additional information) received warrants (the “Penny Warrants”) to purchase 402,981 shares of Altisource common stock (the “Penny Warrant Shares”). The number of Penny Warrant Shares was subject to reduction based on the amount of Aggregate Paydowns. Based on Aggregate Paydowns made during 2023, the number of Penny Warrant Shares was reduced to 201,588 .
The following table summarizes the activity related to our Penny Warrant Shares:
| Penny Warrant Shares | |||||
Outstanding as of December 31, 2023 | |||||
| Exercised | ( | ||||
Outstanding as of December 31, 2024 | |||||
| Exercised | ( | ||||
Outstanding as of September 30, 2025 | |||||
The exercise price per share of common stock under each Penny Warrant was equal to $0.01 . As of September 30, 2025, no Penny Warrant Shares remain outstanding.
Stakeholder Warrants
On April 3, 2025, the Company distributed 70.5 million warrants to purchase approximately 14.3 million shares of Altisource common stock for $9.5998 per share (the “Stakeholder Warrants”). The distribution of Stakeholder Warrants was contingent upon, among other things, approval of the distribution by the Company’s shareholders and the consummation of the Debt Exchange Transaction (such conditions, collectively, the “Distribution Conditions”). The Distribution Conditions were satisfied during the quarter ended March 31, 2025.
Fifty percent of the Stakeholder Warrants will expire on April 2, 2029 and require settlement through the cash payment to the Company of the exercise price of such Stakeholder Warrant (“Cash Exercise Stakeholder Warrants”). Fifty percent of the Stakeholder Warrants will expire on April 30, 2032 and require settlement through the forfeiture of shares of common stock to the Company equal to the exercise price of such Stakeholder Warrants (“Net Settle Stakeholder Warrants”). Each Cash Exercise Stakeholder Warrant is exercisable for 0.20313 shares of our common stock (“Cash Exercise Stakeholder Warrant Shares). Each Net Settle Stakeholder Warrant is exercisable for 0.20313 shares of our common stock (“Net Settle Stakeholder Warrant Shares” and, collectively with the Cash Exercise Stakeholder Warrant Shares, the “Stakeholder Warrant Shares”). The Stakeholder Warrants became exercisable pursuant to their term on July 28, 2025. The exercise price of the Stakeholder Warrants is $1.95 per Stakeholder Warrant.
The Stakeholder Warrants are listed on the NASDAQ Global Select Market and began trading on May 7, 2025. The Cash Exercise Stakeholder Warrants trade under the symbol “ASPSZ” and the Net Settle Stakeholder Warrants trade under the symbol “ASPSW”.
For purposes of recording the distribution of the Stakeholder Warrants during the three months ended March 31, 2025, the fair values of the Cash Exercise Stakeholder Warrants and the Net Exercise Stakeholder Warrants were determined using the Black-Scholes option pricing model. The following table summarizes the fair value of the Stakeholder Warrants and the assumptions used to determine the fair value:
| Cash Exercise Stakeholder Warrants | Net Settle Stakeholder Warrants | |||||||||||||
| Risk-free interest rate (%) | % | % | ||||||||||||
| Expected stock price volatility (%) | % | % | ||||||||||||
| Expected dividend yield | % | % | ||||||||||||
| Expected option life (in years) | ||||||||||||||
| Fair value per Stakeholder Warrant | $ | $ | ||||||||||||
The Stakeholder Warrants are indexed to the common stock and are classified as equity under ASC 815 Derivatives and Hedging, resulting in a $40.5 million increase in Additional paid-in capital. The distribution of the Stakeholder Warrants are non-reciprocal pro rata distributions and are accounted for as a dividend. Because the Company has negative retained earnings,
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ALTISOURCE PORTFOLIO SOLUTIONS S.A.
Notes to Condensed Consolidated Financial Statements (Continued)
the Company recorded the dividend as a $40.5 million reduction to Additional paid-in capital. Since the transaction is accounted for as both an increase and a decrease in Additional paid-in capital, the net result is zero and is not reflected in the Condensed Consolidated Statements of Equity (Deficit).
The following table summarizes outstanding Stakeholder Warrants and Stakeholder Warrant Shares issuable upon the exercise of outstanding Stakeholder Warrants following the distribution:
| Cash Exercise Stakeholder Warrants | Cash Exercise Stakeholder Warrant Shares | Net Settle Stakeholder Warrants | Net Settle Stakeholder Warrant Shares | Total Stakeholder Warrants | Total Stakeholder Warrant Shares | |||||||||||||||||||||||||||
The following table summarizes the activity related to Stakeholder Warrants:
| Cash Exercise Stakeholder Warrants | Net Settle Stakeholder Warrants | |||||||||||||
Outstanding at December 31, 2024 | ||||||||||||||
| Granted | ||||||||||||||
| Exercised | ( | ( | ||||||||||||
Outstanding at September 30, 2025 | ||||||||||||||
NOTE 12 — OTHER NON-CURRENT LIABILITIES
Other non-current liabilities consist of the following:
| (in thousands) | September 30, 2025 | December 31, 2024 | ||||||||||||
| Income tax liabilities | $ | $ | ||||||||||||
| Operating lease liabilities | ||||||||||||||
| Deferred revenue | ||||||||||||||
| Other non-current liabilities | ||||||||||||||
| Total | $ | $ | ||||||||||||
See Note 19 for a discussion of the reduction in income tax liabilities.
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ALTISOURCE PORTFOLIO SOLUTIONS S.A.
Notes to Condensed Consolidated Financial Statements (Continued)
NOTE 13 — FAIR VALUE MEASUREMENTS AND FINANCIAL INSTRUMENTS
The following table presents the carrying amount and estimated fair value of financial instruments and certain liabilities measured at fair value as of September 30, 2025 and December 31, 2024. The following fair values are estimated using market information and what the Company believes to be appropriate valuation methodologies under GAAP:
| September 30, 2025 | December 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||
| (in thousands) | Carrying amount | Fair value | Carrying amount | Fair value | ||||||||||||||||||||||||||||||||||||||||||||||
| Level 1 | Level 2 | Level 3 | Level 1 | Level 2 | Level 3 | |||||||||||||||||||||||||||||||||||||||||||||
| Assets: | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Cash and cash equivalents | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||
| Restricted cash | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Liabilities: | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Senior secured term loan | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Super senior term loan | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Revolving loan agreement | ||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurements on a Recurring Basis
Cash and cash equivalents and restricted cash are carried at amounts that approximate their fair values due to the highly liquid nature of these instruments and are measured using Level 1 inputs.
The fair value of our senior secured term loan is based on quoted mark prices. Based on the frequency of trading, we do not believe that there is an active market for our debt. Therefore, the quoted prices are considered Level 2 inputs.
Our Super Senior Facility and Revolving Loan Agreement were measured using Level 3 inputs based on the present value of the future payments. As quoted market prices are not available and there is no trading, we believe that the contractual interest rates represent the market rate at the measurement date and therefore the fair value equals the book value.
There were no transfers between different levels during the periods presented.
Concentrations of Credit Risk
Financial instruments that subject us to concentrations of credit risk primarily consist of cash and cash equivalents and accounts receivable. Our policy is to deposit our cash and cash equivalents with larger, highly rated financial institutions. The Company derived 42 % and 43 % of its revenue from Onity for the three and nine months ended September 30, 2025, respectively (see Note 2 for additional information on Onity revenues and accounts receivable balance). The Company strives to mitigate its concentrations of credit risk with respect to accounts receivable by actively monitoring past due accounts and the economic status of larger customers, if known.
NOTE 14 — SHAREHOLDERS’ EQUITY AND SHARE-BASED COMPENSATION
Common stock
On February 18, 2025, the Company’s shareholders approved an increase in the number of authorized shares from 100 million to 250 million, a decrease in the par value of the common stock from $1.00 to $0.01 and an increase in the number of shares of common stock reserved for issuance under the Equity Plan from approximately 1.5 million to approximately 2.0 million.
On February 19, 2025, the Company issued 7.3 million Debt Exchange Shares to lenders in connection with the Debt Exchange Transaction. See Note 10, Long-Term Debt. Pursuant to the terms of the Exchange Agreement, dated February 19, 2025, by and among the Borrower and Altisource Portfolio Solutions S.A., on the one hand, and the Lenders, on the other hand, with limited exceptions, the Lenders were not, among other things, permitted to sell, offer to sell, grant any option to purchase or otherwise dispose of any Debt Exchange Shares, without the prior written consent of Altisource Portfolio Solutions S.A., until September 17, 2025.
Share Repurchase Program
On May 16, 2023, our shareholders approved the renewal and amendment of the share repurchase program previously approved by our shareholders on May 15, 2018. Under the program, we are authorized to purchase up to 0.4 million shares of our
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ALTISOURCE PORTFOLIO SOLUTIONS S.A.
Notes to Condensed Consolidated Financial Statements (Continued)
common stock, based on a limit of 15 % of the outstanding shares of common stock on the date of approval, at a minimum price of $8.00 per share and a maximum price of $200.00 per share, until May 16, 2028. As of September 30, 2025, approximately 0.4 million shares of common stock remain available for repurchase under the program. In connection with the Share Consolidation, the Company purchased 204 shares of common stock during the nine months ended September 30, 2025. There were no
Share-Based Compensation
We issue share-based awards in the form of stock options, restricted shares and restricted share units (“RSUs”) for certain employees, officers and directors. We recognized share-based compensation expense of $3.1 million and $3.9 million for the nine months ended September 30, 2025 and 2024, respectively ($1.3 million and $0.9 million for the third quarter of 2025 and 2024, respectively). As of September 30, 2025, estimated unrecognized compensation costs related to share-based awards amounted to $4.4 million, which we expect to recognize over a weighted average remaining requisite service period of approximately 1.42 years.
Stock Options
Stock option grants are composed of a combination of service-based, market-based and performance-based options.
Service-Based Options. These options generally vest over three or four years with equal annual vesting and generally expire on the earlier of ten years after the date of grant or following termination of service. A total of five thousand service-based options were outstanding as of September 30, 2025.
Market-Based Options. These option grants generally have two components, each of which vests only upon the achievement of certain criteria. The first component, which we refer to as “ordinary performance” grants, generally consists of two-thirds of the market-based grant and begins to vest if the stock price is at least double the exercise price, as long as the stock price realizes a compounded annual gain of at least 20 % over the exercise price. The remaining third of the market-based options, which we refer to as “extraordinary performance” grants, generally begins to vest if the stock price is at least triple the exercise price, as long as the stock price realizes a compounded annual gain of at least 25 % over the exercise price. Market-based options generally vest in three or four year installments with the first installment vesting upon the achievement of the criteria and the remaining installments vesting thereafter in equal annual installments. Market-based options generally expire on the earlier of ten years after the date of grant or following termination of service, unless the performance criteria is met prior to termination of service or in the final three years of the option term, in which case vesting will generally continue in accordance with the provisions of the award agreement. A total of three thousand market-based options were outstanding as of September 30, 2025.
Performance-Based Options. These option grants generally will vest if certain specific financial measures are achieved; typically with one-fourth vesting on each anniversary of the grant date. The award of performance-based options is adjusted based on the level of achievement specified in the award agreements. If the performance criteria achieved is above threshold performance levels, participants generally have the opportunity to vest in 50 % to 200 % of the option grants, depending upon performance achieved. If the performance criteria achieved is below a certain threshold, the options are canceled. The options generally expire on the earlier of ten years after the date of grant or following termination of service, unless the performance criteria is met prior to termination of service in which case vesting will generally continue in accordance with the provisions of the award agreement. There were 34 thousand performance-based options outstanding as of September 30, 2025.
There were no
We determined the expected option life of all service-based stock option grants using the simplified method, determined based on the graded vesting term plus the contractual term of the options, divided by two. We use the simplified method because we believe that our historical data does not provide a reasonable basis upon which to estimate expected option life.
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ALTISOURCE PORTFOLIO SOLUTIONS S.A.
Notes to Condensed Consolidated Financial Statements (Continued)
The following table summarizes the grant date fair value of stock options that vested during the periods presented:
| Nine months ended September 30, | ||||||||||||||
| (in thousands, except per share data) | 2025 | 2024 | ||||||||||||
| Weighted average grant date fair value of stock options granted per share | $ | $ | ||||||||||||
| Intrinsic value of options exercised | ||||||||||||||
| Grant date fair value of stock options that vested | ||||||||||||||
The following table summarizes the activity related to our stock options:
| Number of options | Weighted average exercise price | Weighted average contractual term (in years) | Aggregate intrinsic value (in thousands) | ||||||||||||||||||||
| Outstanding as of December 31, 2024 | $ | $ | |||||||||||||||||||||
| Granted | |||||||||||||||||||||||
| Forfeited | ( | ||||||||||||||||||||||
| Outstanding as of September 30, 2025 | |||||||||||||||||||||||
| Exercisable as of September 30, 2025 | |||||||||||||||||||||||
Other Share-Based Awards
The Company’s other share-based and similar types of awards are comprised of restricted shares and RSUs. The restricted shares and RSUs are comprised of a combination of service-based awards, performance-based awards and performance and market-based awards.
Service-Based Awards. These awards generally vest over one-to-four-year periods. A total of 973 thousand service-based awards were outstanding as of September 30, 2025.
Performance-Based Awards. These awards generally vest if certain specific financial measures are achieved; generally one-third vests on each anniversary of the grant date or cliff-vest on the third anniversary of the grant date. The number of performance-based restricted shares and RSUs that may vest is based on the level of achievement as specified in the award agreements. If the performance criteria achieved is above certain financial performance levels and Altisource’s share performance is above certain established criteria, participants have the opportunity to vest in up to 150 % of the restricted share unit award for certain awards. If the performance criteria achieved is below certain thresholds, the award is canceled. A total of 29 thousand performance-based awards were outstanding as of September 30, 2025.
Performance-Based and Market-Based Awards. These awards generally vest if certain specific financial measures are achieved and if certain specific market conditions are achieved. If the performance criteria achieved is above certain financial performance levels and Altisource’s share performance is above certain established criteria, participants have the opportunity to vest in up to 300 % of the restricted share unit award for certain awards. If the performance criteria or the market criteria is below certain thresholds, the award is canceled. The Company estimates the grant date fair value of these awards using a Monte Carlo simulation model. A total of 29 thousand performance-based and market-based awards were outstanding as of September 30, 2025.
The Company granted 1.0 million RSUs (at a weighted average grant date fair value of $7.62 per share) during the nine months ended September 30, 2025. These grants included approximately 0.6 million of RSUs granted to senior management in connection with the Debt Exchange Transaction, 12 thousand performance-based awards and 12 thousand awards that include both a performance condition and a market condition. The Company granted 205 thousand RSUs (at a weighted average grant date fair value of $19.65 per share) during the nine months ended September 30, 2024. These grants included 11 thousand performance-based awards and 11 thousand awards that include both a performance condition and a market condition.
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ALTISOURCE PORTFOLIO SOLUTIONS S.A.
Notes to Condensed Consolidated Financial Statements (Continued)
The following table summarizes the activity related to our restricted shares and RSUs:
| Number of restricted shares and restricted share units | |||||
| Outstanding as of December 31, 2024 | |||||
| Granted | |||||
| Issued | ( | ||||
| Forfeited/canceled | ( | ||||
| Outstanding as of September 30, 2025 | |||||
NOTE 15 — REVENUE
We classify revenue in three categories: service revenue, revenue from reimbursable expenses and non-controlling interests. Service revenue consists of amounts attributable to our fee-based services. Reimbursable expenses and non-controlling interests are pass-through items for which we earn no margin. Reimbursable expenses consist of amounts we incur on behalf of our customers in performing our fee-based services that we pass directly on to our customers without a markup. Non-controlling interests represent the earnings of Lenders One, a consolidated entity that is a mortgage cooperative managed, but not owned, by Altisource. Lenders One’s earnings are included in revenue and reduced from net (loss) income to arrive at net (loss) income attributable to Altisource (see Note 1). Our services are provided to customers located in the United States. The components of revenue were as follows:
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||||||||
| (in thousands) | 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||||
| Service revenue | $ | $ | $ | $ | ||||||||||||||||||||||
| Reimbursable expenses | ||||||||||||||||||||||||||
| Non-controlling interests | ||||||||||||||||||||||||||
| Total | $ | $ | $ | $ | ||||||||||||||||||||||
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ALTISOURCE PORTFOLIO SOLUTIONS S.A.
Notes to Condensed Consolidated Financial Statements (Continued)
Disaggregation of Revenue
Disaggregation of total revenue by segment and major source was as follows:
| Three months ended September 30, 2025 | Three months ended September 30, 2024 | |||||||||||||||||||||||||||||||||||||
| (in thousands) | Servicer and Real Estate | Origination | Total revenue | Servicer and Real Estate | Origination | Total revenue | ||||||||||||||||||||||||||||||||
| Revenue recognized when services are performed or assets are sold | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
| Revenue related to technology platforms and professional services | ||||||||||||||||||||||||||||||||||||||
| Reimbursable expenses revenue | ||||||||||||||||||||||||||||||||||||||
| Total revenue | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
| Nine months ended September 30, 2025 | Nine months ended September 30, 2024 | |||||||||||||||||||||||||||||||||||||
| (in thousands) | Servicer and Real Estate | Origination | Total revenue | Servicer and Real Estate | Origination | Total revenue | ||||||||||||||||||||||||||||||||
| Revenue recognized when services are performed or assets are sold | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
| Revenue related to technology platforms and professional services | ||||||||||||||||||||||||||||||||||||||
| Reimbursable expenses revenue | ||||||||||||||||||||||||||||||||||||||
| Total revenue | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
Disaggregation of service revenue by the timing of revenue recognition was as follows:
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||||||||
| (in thousands) | 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||||
| Over-time revenue recognition | $ | $ | $ | $ | ||||||||||||||||||||||
| Point-in-time revenue recognition | ||||||||||||||||||||||||||
| Total service revenue | $ | $ | $ | $ | ||||||||||||||||||||||
The timing of revenue recognition, billings, and cash collections results in billed and unbilled accounts receivable (presented as accounts receivable on our condensed consolidated balance sheets), and customer advances (presented as deferred revenue on our condensed consolidated balance sheets), where applicable.
The over-time revenue recognition model consists primarily of the following services for which revenue is recognized over the period during which services are provided:
•For foreclosure trustee services, revenue is recognized as work progresses, in accordance with agreed upon milestones with full recognition upon completion and/or recording the related foreclosure deed
•For software-as-a-service (“SaaS”) based technology to manage REO, we recognize revenue over the estimated average number of months the REO properties are on the platform before they are sold
•For vendor management transactions, revenue is recognized over the period during which services are provided
•For fund disbursement services, we recognize revenue over the period during which we perform the processing services with full recognition upon completion of the disbursements
•For residential real estate renovation services, we recognize revenue over time as work is completed, measured by the percentage of work performed relative to the total project. Field inspections by qualified professionals form a fundamental part of the Company’s assessment, measure and documentation of work completed on real estate renovations. As of September 30, 2025, the value of unfulfilled renovation orders amounted to $3.7 million, with the majority of this backlog expected to be completed and recognized as revenue within the fourth quarter of 2025 and the remainder anticipated to be completed in the first quarter of 2026
•We recognize membership fees from Lender One members ratably over the term of membership
•For vendor management oversight SaaS, we recognize revenue over the period during which we perform the services.
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ALTISOURCE PORTFOLIO SOLUTIONS S.A.
Notes to Condensed Consolidated Financial Statements (Continued)
Transactions with Related Parties
John G. Aldridge, Jr., the Managing Partner of Aldridge Pite LLP (“Aldridge Pite”), is a member of the Board of Directors of Altisource. Aldridge Pite provides eviction and other real estate related services to the Company and pays for the use of certain of the Company’s technology in connection with providing these services. The Company recognized service revenue of $0.1 million and less than $0.1 million for the nine months ended September 30, 2025 and 2024, respectively (less than $0.1 million and less than $0.1 million for the third quarter of 2025 and 2024, respectively), relating to services provided to Aldridge Pite.
Contract Balances
Our contract assets consist of unbilled accounts receivable (see Note 3). Our contract liabilities consist of current deferred revenue and other non-current liabilities as reported on the accompanying condensed consolidated balance sheets. The deferred revenue opening and closing balances were as follows:
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||||||||
| (in thousands) | 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||||
| Deferred revenue, beginning balance | $ | $ | $ | $ | ||||||||||||||||||||||
| Revenue recognized that was included in the deferred revenue balance at the beginning of the period | ( | ( | ( | ( | ||||||||||||||||||||||
| Increase due to billing, excluding amounts recognized as revenue during the period | ||||||||||||||||||||||||||
| Deferred revenue, ending balance | $ | $ | $ | $ | ||||||||||||||||||||||
NOTE 16 — COST OF REVENUE
Cost of revenue principally includes payroll and employee benefits associated with personnel employed in customer service, operations and technology roles, fees paid to external providers related to the provision of services, reimbursable expenses, technology and telecommunications costs as well as depreciation and amortization of operating assets. The components of cost of revenue were as follows:
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||||||||
| (in thousands) | 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||||
| Outside fees and services | $ | $ | $ | $ | ||||||||||||||||||||||
| Compensation and benefits | ||||||||||||||||||||||||||
| Technology and telecommunications | ||||||||||||||||||||||||||
| Reimbursable expenses | ||||||||||||||||||||||||||
| Depreciation and amortization | ||||||||||||||||||||||||||
| Total | $ | $ | $ | $ | ||||||||||||||||||||||
Transactions with Related Parties
The Company recognized cost of revenue of $0.8 million and $0.7 million for the nine months ended September 30, 2025 and 2024, respectively ($0.3 million and $0.3 million for the third quarter of 2025 and 2024, respectively), relating to services received from Aldridge Pite. As of September 30, 2025, the Company had no amounts payable to Aldridge Pite.
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ALTISOURCE PORTFOLIO SOLUTIONS S.A.
Notes to Condensed Consolidated Financial Statements (Continued)
NOTE 17 — SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
Selling, general and administrative expenses includes payroll and employee benefits associated with personnel employed in executive, sales and marketing, finance, technology, law, compliance, human resources, vendor management, facilities and risk management roles. This category also includes professional services fees, occupancy costs, marketing costs, depreciation and amortization of non-operating assets and other expenses. The components of selling, general and administrative expenses were as follows:
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||||||||
| (in thousands) | 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||||
| Compensation and benefits | $ | $ | $ | $ | ||||||||||||||||||||||
| Professional services | ||||||||||||||||||||||||||
| Amortization of intangible assets | ||||||||||||||||||||||||||
| Occupancy related costs | ||||||||||||||||||||||||||
| Marketing costs | ||||||||||||||||||||||||||
| Depreciation and amortization | ||||||||||||||||||||||||||
| Other | ||||||||||||||||||||||||||
| Total | $ | $ | $ | $ | ||||||||||||||||||||||
NOTE 18 — OTHER INCOME (EXPENSE), NET
Other income (expense), net consists of the following:
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||||||||
| (in thousands) | 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||||
| Interest income (expense) | $ | $ | $ | $ | ||||||||||||||||||||||
| Other, net | ( | |||||||||||||||||||||||||
| Total | $ | $ | $ | $ | ||||||||||||||||||||||
NOTE 19 — INCOME TAXES
We recognized an income tax benefit (provision) of $15.1 million and $(2.2 ) million for the nine months ended September 30, 2025 and 2024, respectively ($0.7 million and $(0.8 ) million for the third quarter of 2025 and 2024, respectively). The income tax benefit for the nine months ended September 30, 2025 was driven primarily by the reversal of liabilities for uncertain tax positions. The income tax (provision) benefit for the three and nine months ended September 30, 2025 was also driven by income tax expense on transfer pricing income from India and the United States and no tax benefit on the pretax loss from our Luxembourg operating company.
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ALTISOURCE PORTFOLIO SOLUTIONS S.A.
Notes to Condensed Consolidated Financial Statements (Continued)
The income tax (provision) benefit consists of the following:
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||||||
| Current: | ||||||||||||||||||||||||||
| Foreign - U.S. federal | $ | ( | $ | $ | ( | $ | ( | |||||||||||||||||||
| Foreign - U.S. state | ( | ( | ||||||||||||||||||||||||
| Foreign - non-U.S. | ( | ( | ( | |||||||||||||||||||||||
| $ | ( | $ | ( | $ | $ | ( | ||||||||||||||||||||
| Deferred: | ||||||||||||||||||||||||||
| Domestic | $ | ( | $ | ( | $ | ( | $ | ( | ||||||||||||||||||
| Foreign - U.S. state | ||||||||||||||||||||||||||
| Foreign - non-U.S. | ||||||||||||||||||||||||||
| $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||||||
| Income tax (provision) benefit | $ | ( | $ | ( | $ | $ | ( | |||||||||||||||||||
Uncertain Tax Positions
The Company follows ASC Topic 740 Income Taxes, which clarifies the accounting and disclosure for uncertainty in tax positions. We analyzed our tax filing positions in the domestic and foreign tax jurisdictions where we are required to file income tax returns as well as for all open tax years subject to audit in these jurisdictions. The Company has open tax years in the United States (2017 through 2023), India (2011 through 2024) and Luxembourg (2017 through 2023).
During the second quarter of 2025, Management concluded that certain of its India tax positions for several years were more likely than not to be sustained based on second quarter developments (including, among other reasons, a net refund received of $1.3 million). As a result, the Company recognized a $9.6 million reversal of its reserve for uncertain tax positions related to India and a $9.0 million reversal of related accrued interest.
The effective tax rate differs from the Luxembourg statutory tax rate due to tax rate differences on foreign earnings, increases in uncertain tax positions, state taxes, a decrease in unrecognized tax benefits, tax exempt income primarily from the sale of Pointillist and a valuation allowance against deferred tax assets the Company believes it is more likely than not will not be realized.
The following table summarizes changes in unrecognized tax benefits:
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||||||
| Amount of unrecognized tax benefit as of the beginning of the period | $ | $ | $ | $ | ||||||||||||||||||||||
| Decreases as a result of tax positions taken in a prior period | — | ( | ( | — | ||||||||||||||||||||||
| Increases as a result of tax positions taken in a prior period | — | |||||||||||||||||||||||||
| Decreases as a result of tax positions taken in the current period | ( | — | — | — | ||||||||||||||||||||||
| Increases as a result of tax positions taken in the current period | — | |||||||||||||||||||||||||
| Amount of unrecognized tax benefit as of the end of the period | $ | $ | $ | $ | ||||||||||||||||||||||
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ALTISOURCE PORTFOLIO SOLUTIONS S.A.
Notes to Condensed Consolidated Financial Statements (Continued)
The following table reconciles the Luxembourg statutory tax rate to our effective tax rate:
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||||||
| Statutory tax rate | % | % | % | % | ||||||||||||||||||||||
| Change in valuation allowance | ( | ( | ( | ( | ||||||||||||||||||||||
| State tax expense | ( | ( | ||||||||||||||||||||||||
| Uncertain tax positions | ( | ( | ( | |||||||||||||||||||||||
| Tax rate differences on foreign earnings | ( | ( | ||||||||||||||||||||||||
| Tax exempt income | ||||||||||||||||||||||||||
| Other | ( | ( | ( | |||||||||||||||||||||||
| Effective tax rate | ( | % | ( | % | % | ( | % | |||||||||||||||||||
The total amount of unrecognized tax benefits including interest and penalties that, if recognized, would affect the effective tax rate is $3.5 million and $19.2 million as of September 30, 2025 and December 31, 2024, respectively. The Company recognizes interest, if any, related to unrecognized tax benefits as a component of income tax expense. As of September 30, 2025 and 2024, the Company had recorded accrued interest and penalties related to unrecognized tax benefits of $1.1 million and $9.1 million, respectively.
NOTE 20 — EARNINGS (LOSS) PER SHARE
Basic (loss) earnings per share is computed by dividing net (loss) income available to common shareholders by the weighted average number of common shares outstanding for the period. For the three and nine months ended September 30, 2025, diluted earnings per share reflects the assumed conversion of all dilutive securities using the treasury stock method. For three and nine months ended September 30, 2025, diluted net (loss) earnings per share excludes all dilutive securities because their impact would be anti-dilutive, as described below. Basic and diluted (loss) earnings per share has been retroactively adjusted for all prior periods presented to reflect the effects of the Share Consolidation.
Basic and diluted (loss) earnings per share are calculated as follows:
| Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||||||||
| (in thousands, except per share data) | 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||||
| Net (loss) income attributable to Altisource | $ | ( | $ | ( | $ | $ | ( | |||||||||||||||||||
| Weighted average common shares outstanding, basic | ||||||||||||||||||||||||||
| Weighted average common shares outstanding, diluted | ||||||||||||||||||||||||||
| (Loss) earnings per share: | ||||||||||||||||||||||||||
| Basic | $ | ( | $ | ( | $ | $ | ( | |||||||||||||||||||
| Diluted | $ | ( | $ | ( | $ | $ | ( | |||||||||||||||||||
For the nine months ended September 30, 2025 and 2024, 0.1 million and 0.3 million, respectively (3.0 million and 0.2 million for the third quarter of 2025 and 2024, respectively), stock options, warrants, restricted shares and RSUs were excluded from the computation of (loss) earnings per share, as a result of the following:
•For the nine months ended September 30, 2024, 0.1 million (2.9 million and 0.1 million for the third quarter of 2025 and 2024, respectively) (no comparative amount for the nine months ended September 30, 2025), stock options, warrants, restricted shares and RSUs were anti-dilutive and have been excluded from the computation of diluted (loss) earnings per share because the Company incurred a net loss
•For the nine months ended September 30, 2025 and 2024, less than 0.1 million and 0.1 million, respectively (less than 0.1
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ALTISOURCE PORTFOLIO SOLUTIONS S.A.
Notes to Condensed Consolidated Financial Statements (Continued)
•For the nine months ended September 30, 2025 and 2024, 0.1 million and 0.1 million, respectively (0.1 million and 0.1 million for the third quarter of 2025 and 2024, respectively), stock options, restricted shares and RSUs, which begin to vest upon the achievement of certain market criteria related to our common stock price, performance criteria and a total shareholder return compared to the market benchmark, have been excluded from the computation of diluted (loss) earnings per share because the achievement levels have not yet been met
NOTE 21 — COMMITMENTS, CONTINGENCIES AND REGULATORY MATTERS
We record a liability for contingencies if an unfavorable outcome is probable and the amount of loss can be reasonably estimated, including expected insurance coverage. For proceedings where the reasonable estimate of loss is a range, we record a best estimate of loss within the range.
Litigation
We are currently involved in legal actions in the course of our business, most of which seek monetary damages. Although the outcome of these proceedings cannot be predicted with certainty, we currently believe that their outcome, both individually and in the aggregate, will not have a material impact on our financial condition, results of operations or cash flows.
National Fair Housing Alliance v. Altisource Solutions, Inc., et al.
On or about February 1, 2018, the National Fair Housing Alliance (“NFHA”) and eighteen regional housing groups filed a civil complaint, subsequently amended, against Altisource Solutions, Inc., a wholly owned subsidiary of the Company, Deutsche Bank National Trust, as Trustee, Deutsche Bank Trust Company Americas, as Trustee, and Ocwen Loan Servicing, LLC, n/k/a Onity Group, Inc. in the United States District Court for the Northern District of Illinois. The complaint alleges violations of the federal Fair Housing Act in connection with the maintenance and marketing of certain real estate owned properties. Plaintiffs seek monetary damages, including attorneys’ fees. Trial is currently scheduled to begin in February 2026, although the schedule could change.
The Company believes it has meritorious defenses and intends to defend itself vigorously in this matter. While it is too early to predict the outcome of the proceedings or whether an adverse result would have a material impact on our operations or financial position, an adverse outcome could result in a material damages award. At this time, the Company cannot reasonably estimate the potential loss or range of loss, if any, associated with this matter.
Regulatory Matters
Periodically, we are subject to audits, examinations and investigations by governmental authorities and receive subpoenas, civil investigative demands or other requests for information from such governmental authorities in connection with their regulatory or investigative authority. We are currently responding to such inquiries from governmental authorities relating to certain aspects of our business. We believe it is premature to predict the potential outcome or to estimate any potential financial impact in connection with these inquiries.
Onity Related Matters
As discussed in Note 2, during the three and nine months ended September 30, 2025, Onity was our largest customer, accounting for 42 % and 43 % of our total revenue, respectively. Additionally, 5 % of our revenue for the nine months ended September 30, 2025 (4 % of our revenue for the third quarter of 2025) was earned on the loan portfolios serviced by Onity, when a party other than Onity or the MSRs owner selected Altisource as the service provider.
Onity has disclosed that it is subject to a number of ongoing federal and state regulatory examinations, consent orders, inquiries, subpoenas, civil investigative demands, requests for information and other actions and is subject to pending and threatened legal proceedings, some of which include claims against Onity for substantial monetary damages. Previous regulatory actions against Onity have subjected Onity to independent oversight of its operations and placed certain restrictions on its ability to acquire servicing rights or proceed with default-related actions on the loans it services. Existing or future similar matters could result in adverse regulatory or other actions against Onity. In addition to the above, Onity may become subject to future adverse regulatory or other actions.
Onity has disclosed that Rithm is one of its largest servicing clients. As of June 30, 2025, Onity reported that approximately 11 % of loans serviced and subserviced by Onity (measured in UPB) and approximately 59 % of all delinquent loans that Onity services were related to Rithm MSRs or rights to MSRs.
The existence or outcome of Onity regulatory matters or the termination of Onity’s sub-servicing agreements with Rithm, or other significant Onity clients may have significant adverse effects on Onity’s business. For example, Onity may be required to
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ALTISOURCE PORTFOLIO SOLUTIONS S.A.
Notes to Condensed Consolidated Financial Statements (Continued)
alter the way it conducts business, including the parties it contracts with for services, it may be required to seek changes to its existing pricing structure with us, it may lose its non-government-sponsored enterprise (“GSE”) servicing rights or subservicing arrangements or may lose one or more of its state servicing or origination licenses. Additional regulatory actions or adverse financial developments may impose additional restrictions on or require changes in Onity’s business that could require it to sell assets or change its business operations. Any or all of these effects and others could result in our eventual loss of Onity as a customer or a reduction in the number and/or volume of services it purchases from us or the loss of other customers.
If any of the following events occurred, Altisource’s revenue could be significantly reduced and our results of operations could be materially adversely affected, including from the possible impairment or write-off of goodwill, intangible assets, property and equipment, other assets and accounts receivable:
•Altisource loses Onity as a customer or there is a significant reduction in the volume of services it purchases from us
•Onity loses, sells or transfers a significant portion of its GSE or Federal Housing Administration servicing rights or subservicing arrangements or remaining other servicing rights or subservicing arrangements and Altisource fails to be retained as a service provider
•The contractual relationship between Onity and Rithm changes significantly, including Onity’s sub-servicing arrangement with Rithm expiring without renewal, and this change results in a change in our status as a provider of services related to the Subject MSRs
•Onity loses state servicing licenses in states with a significant number of loans in Onity’s servicing portfolio
•Onity is subject to stays, moratoriums, suspensions or other restrictions that limit or delay default-related actions on the loans it services
•The contractual relationship between Onity and Altisource changes significantly or there are significant changes to our pricing to Onity for services from which we generate material revenue
•Altisource otherwise fails to be retained as a service provider.
The foregoing list is not intended to be exhaustive. Management cannot predict whether any of these events or other events will occur or the amount of any impact they may have on Altisource.
Leases
We lease certain premises and equipment, primarily consisting of office space. Certain of our leases include options to renew at our discretion or terminate leases early, and these options are considered in our determination of the expected lease term. Certain of our lease agreements include rental payments adjusted periodically for inflation. Our lease agreements generally do not contain any material residual value guarantees or material restrictive covenants. We sublease certain office space to third parties. Sublease income was $0.2 million and $0.5 million for the nine months ended September 30, 2025 and 2024, respectively (less than $0.1 million and $0.2 million for the third quarter of 2025 and 2024, respectively). The amortization periods of right-of-use assets are generally limited by the expected lease term. Our leases generally have expected lease terms at adoption of one to six years .
Information about our lease terms and our discount rate assumption were as follows as of September 30:
| 2025 | 2024 | |||||||||||||
| Weighted average remaining lease term (in years) | ||||||||||||||
| Weighted average discount rate | % | % | ||||||||||||
Our lease activity during the periods was as follows:
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||||||||
| (in thousands) | 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||||
| Operating lease costs: | ||||||||||||||||||||||||||
| Selling, general and administrative expense | $ | $ | $ | $ | ||||||||||||||||||||||
| Cash used in operating activities for amounts included in the measurement of lease liabilities | $ | $ | $ | $ | ||||||||||||||||||||||
| Short-term (twelve months or less) lease costs | ||||||||||||||||||||||||||
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ALTISOURCE PORTFOLIO SOLUTIONS S.A.
Notes to Condensed Consolidated Financial Statements (Continued)
Maturities of our lease liabilities as of September 30, 2025 are as follows:
| (in thousands) | Operating lease obligations | |||||||
| 2025 | $ | |||||||
| 2026 | ||||||||
| 2027 | ||||||||
| 2028 | ||||||||
| 2029 | ||||||||
| Total lease payments | ||||||||
| Less: interest | ( | |||||||
| Present value of lease liabilities | $ | |||||||
Escrow and Other Balances
We hold customers’ assets in escrow and other accounts at various financial institutions pending completion of certain real estate activities. These amounts are held in escrow and other accounts for limited periods of time and are not included in the accompanying condensed consolidated balance sheets. Amounts held in escrow and other accounts were $52.5 million and $27.1 million as of September 30, 2025 and December 31, 2024, respectively.
NOTE 22 — SEGMENT REPORTING
Our business segments are based upon our organizational structure, which focuses primarily on the services offered, and are consistent with the internal reporting used by our Chief Executive Officer (our chief operating decision maker) to evaluate operating performance and to assess the allocation of our resources.
We conduct our operations through two reportable segments: Servicer and Real Estate and Origination. In addition, we report Corporate and Others separately.
The Servicer and Real Estate segment provides loan servicers and real estate investors with solutions and technologies that span the mortgage and real estate lifecycle. The Origination segment provides originators with solutions and technologies that span the mortgage origination lifecycle. Corporate and Others includes interest expense and costs related to corporate functions including executive, infrastructure and certain technology groups, finance, law, compliance, human resources, vendor management, facilities, risk management, and eliminations between reportable segments.
Income (loss) before income taxes and non-controlling interests is the measure of segment profit and loss that is determined in accordance with the measurement principles used in measuring the corresponding amounts in the consolidated financial statements and used by the chief operating decision maker to evaluate segment results.
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ALTISOURCE PORTFOLIO SOLUTIONS S.A.
Notes to Condensed Consolidated Financial Statements (Continued)
Financial Information
Financial information for our segments is as follows:
| Three months ended September 30, 2025 | ||||||||||||||||||||||||||
| (in thousands) | Servicer and Real Estate | Origination | Corporate and Others | Consolidated Altisource | ||||||||||||||||||||||
| Revenue | $ | $ | $ | $ | ||||||||||||||||||||||
| Cost of revenue | ||||||||||||||||||||||||||
| Gross profit (loss) | ( | |||||||||||||||||||||||||
| Selling, general and administrative expenses | ||||||||||||||||||||||||||
| Income (loss) from operations | ( | ( | ||||||||||||||||||||||||
| Other income (expense), net: | ||||||||||||||||||||||||||
| Interest income (expense) | ( | ( | ( | |||||||||||||||||||||||
| Debt amendment costs | ( | ( | ||||||||||||||||||||||||
Other, net1 | ||||||||||||||||||||||||||
| Total other income (expense), net | ( | ( | ||||||||||||||||||||||||
| Income (loss) before income taxes and non-controlling interests | $ | $ | ( | $ | ( | $ | ( | |||||||||||||||||||
____________________________________________________
1.Corporate and Others other income primarily include other non-operating gains and losses.
| Three months ended September 30, 2024 | ||||||||||||||||||||||||||
| (in thousands) | Servicer and Real Estate | Origination | Corporate and Others | Consolidated Altisource | ||||||||||||||||||||||
| Revenue | $ | $ | $ | $ | ||||||||||||||||||||||
| Cost of revenue | ||||||||||||||||||||||||||
| Gross profit (loss) | ( | |||||||||||||||||||||||||
Selling, general and administrative expenses | ||||||||||||||||||||||||||
| Income (loss) from operations | ( | |||||||||||||||||||||||||
| Other income (expense), net: | ||||||||||||||||||||||||||
| Interest income (expense) | ( | ( | ( | |||||||||||||||||||||||
Other, net1 | ||||||||||||||||||||||||||
| Total other income (expense), net | ( | ( | ||||||||||||||||||||||||
| Income (loss) before income taxes and non-controlling interests | $ | $ | $ | ( | $ | ( | ||||||||||||||||||||
____________________________________________________
1.Corporate and Others other income primarily include other non-operating gains and losses.
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ALTISOURCE PORTFOLIO SOLUTIONS S.A.
Notes to Condensed Consolidated Financial Statements (Continued)
Nine months ended September 30, 2025 | ||||||||||||||||||||||||||
| (in thousands) | Servicer and Real Estate | Origination | Corporate and Others | Consolidated Altisource | ||||||||||||||||||||||
| Revenue | $ | $ | $ | $ | ||||||||||||||||||||||
| Cost of revenue | ||||||||||||||||||||||||||
| Gross profit (loss) | ( | |||||||||||||||||||||||||
Selling, general and administrative expenses | ||||||||||||||||||||||||||
| Income (loss) from operations | ( | |||||||||||||||||||||||||
| Other income (expense), net: | ||||||||||||||||||||||||||
| Interest income (expense) | ( | ( | ( | |||||||||||||||||||||||
| Debt amendment costs | ( | ( | ||||||||||||||||||||||||
Other, net1 | ||||||||||||||||||||||||||
| Total other income (expense), net | ( | ( | ||||||||||||||||||||||||
| Income (loss) before income taxes and non-controlling interests | $ | $ | $ | ( | $ | ( | ||||||||||||||||||||
____________________________________________________
1.Corporate and Others other income primarily include other non-operating gains and losses.
Nine months ended September 30, 2024 | ||||||||||||||||||||||||||
| (in thousands) | Servicer and Real Estate | Origination | Corporate and Others | Consolidated Altisource | ||||||||||||||||||||||
| Revenue | $ | $ | $ | $ | ||||||||||||||||||||||
| Cost of revenue | ||||||||||||||||||||||||||
| Gross profit (loss) | ( | |||||||||||||||||||||||||
Selling, general and administrative expenses | ||||||||||||||||||||||||||
| Income (loss) from operations | ( | |||||||||||||||||||||||||
| Other income (expense), net: | ||||||||||||||||||||||||||
| Interest income (expense) | ( | ( | ( | |||||||||||||||||||||||
Other, net1 | ||||||||||||||||||||||||||
| Total other income (expense), net | ( | ( | ||||||||||||||||||||||||
| Income (loss) before income taxes and non-controlling interests | $ | $ | $ | ( | $ | ( | ||||||||||||||||||||
_________________________________________________
1.Corporate and Others other income primarily include other non-operating gains and losses.
Total Assets
Total assets for our segments are as follows:
| (in thousands) | Servicer and Real Estate | Origination | Corporate and Others | Consolidated Altisource | ||||||||||||||||||||||
| Total assets: | ||||||||||||||||||||||||||
| September 30, 2025 | $ | $ | $ | $ | ||||||||||||||||||||||
| December 31, 2024 | ||||||||||||||||||||||||||
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Management’s discussion and analysis of financial condition and results of operations (“MD&A”) is a supplement to the accompanying interim condensed consolidated financial statements and is intended to provide a reader of our financial statements with a narrative from the perspective of management on our businesses, current developments, financial condition, results of operations and liquidity. Our MD&A should be read in conjunction with our Form 10-K for the year ended December 31, 2024 filed with the Securities and Exchange Commission (“SEC”) on March 31, 2025.
FORWARD-LOOKING STATEMENTS
This Form 10-Q contains forward-looking statements within the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements may relate to, among other things, future events or our future performance or financial condition. Words such as “anticipate,” “intend,” “expect,” “may,” “could,” “should,” “would,” “plan,” “estimate,” “believe,” “predict,” “potential” or “continue” or the negative of these terms and comparable terminology are intended to identify such forward-looking statements. Such statements are based on expectations as to the future and are not statements of historical fact. Furthermore, forward-looking statements are not guarantees of future performance and involve a number of assumptions, risks and uncertainties that could cause actual results to differ materially. The following are examples of such items and are not intended to be all inclusive:
•assumptions related to sources of liquidity and the adequacy of financial resources;
•assumptions about our ability to grow our business, execute our strategic initiatives and improve margins;
•assumptions about the variable nature of our cost structure that would allow us to realign our cost structure in line with revenue;
•assumptions regarding the impact of seasonality;
•estimates regarding our effective tax rate; and
•estimates regarding our reserves and valuations.
Important factors that could cause actual results to differ materially from those suggested by the forward-looking statements include, but are not limited to, the risks discussed in the Risk Factors section of our Form 10-K for the year ended December 31, 2024, as supplemented or amended by the Risk Factors set forth in our subsequent Form 10-Q filings, including this Form 10-Q, such as:
•a reduction in the level of residential mortgage delinquencies, foreclosure initiations and foreclosure sales could negatively affect demand for some of our services;
•our ability to retain Onity Group Inc. (together with its subsidiaries, “Onity”) (formerly Ocwen Financial Corporation, or “Ocwen”) as a customer or our ability to receive the anticipated volume of referrals from Onity;
•the impact of the expiration of the Rithm Brokerage Agreement in August 2025 and our ability to mitigate its impact;
•our ability to comply with material agreements if a change of control is deemed to have occurred including, among other things, through the formation of a shareholder group, which may cause a termination event or event of default under certain of our agreements;
•our ability to execute on our strategic plan;
•our ability to retain our existing customers, expand relationships and attract new customers;
•our ability to comply with governmental regulations and policies and any changes in such regulations and policies;
•our ability to develop, launch and gain market acceptance of new solutions or recoup our investments in developing such new solutions;
•a reduction in the level of origination volume;
•technology incidents, data breaches and cybersecurity risks; and
•significant changes in tax regulations and interpretations in the countries, states and local jurisdictions in which we operate.
We caution you not to place undue reliance on these forward-looking statements which reflect our view only as of the date of this report. We are under no obligation (and expressly disclaim any obligation) to update or alter any forward-looking statements contained herein to reflect any change in our expectations with regard thereto or change in events, conditions or circumstances on which any such statement is based.
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OVERVIEW
Our Business
When we refer to “Altisource,” the “Company,” “we,” “us” or “our” we mean Altisource Portfolio Solutions S.A., a Luxembourg société anonyme, or public limited liability company, and its subsidiaries.
We are an integrated service provider and marketplace for the real estate and mortgage industries. Combining operational excellence with a suite of innovative services and technologies, Altisource helps solve the demands of the ever-changing markets we serve.
We conduct our operations through two reportable segments: Servicer and Real Estate and Origination. In addition, we report Corporate and Others separately.
The Servicer and Real Estate segment provides loan servicers and real estate investors with solutions and technologies that span the mortgage and real estate lifecycle. Within the Servicer and Real Estate segment we provide:
Solutions
Our Solutions business includes property preservation and inspection services, foreclosure trustee services, residential real estate renovation services, residential and commercial construction inspection and risk mitigation services, title insurance (as an agent) and settlement services, and real estate valuation services.
Marketplace
Our Marketplace business includes the Hubzu® online real estate auction platform, real estate brokerage and asset management services.
Technology and software-as-a-service (“SaaS”) Products
Our Technology and SaaS Products business includes Equator® (a SaaS-based technology to manage real estate owned (“REO”) and investor homes, short sales, foreclosure, bankruptcy and eviction processes), Vendorly Invoice (a vendor invoicing and payment system), RentRange® (a single and multi-family rental data, analytics and rent-based valuation solution), REALSynergy® (a commercial loan servicing platform), and NestRangeTM (a single-family automated valuation model and analytics solution).
The Origination segment provides originators with solutions and technologies that span the mortgage origination lifecycle. Within the Origination segment we provide:
Lenders One
Our Lenders One business includes management services provided to the Best Partners Mortgage Cooperative, Inc., doing business as Lenders One® (“Lenders One”), and certain loan manufacturing and capital markets solutions provided to the members of the Lenders One cooperative.
Solutions
Our Solutions business includes loan fulfillment services, real estate valuation services, title insurance (as an agent) and settlement services, and insurance services.
Technology and SaaS Products
Our Technology and SaaS Products business includes Vendorly Monitor (a vendor management platform), Lenders One Loan Automation (“LOLA”) (a marketplace to order services and a tool to automate components of the loan manufacturing process), TrelixAITM (technology to manage the workflow and automate components of the loan fulfillment and pre and post-close quality control), and ADMS (a document management and data analytics delivery platform).
Corporate and Others includes interest expense and costs related to corporate functions including executive, infrastructure and certain technology groups, finance, law, compliance, human resources, vendor management, facilities, risk management and eliminations between reportable segments.
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We classify revenue in three categories: service revenue, revenue from reimbursable expenses and non-controlling interests. In evaluating our performance, we focus on service revenue. Service revenue consists of amounts attributable to our fee-based services. Reimbursable expenses and non-controlling interests are pass-through items for which we earn no margin. Reimbursable expenses consist of amounts we incur on behalf of our customers in performing our fee-based services that we pass directly on to our customers without a markup. Non-controlling interests represent the earnings of Lenders One. Lenders One is a mortgage cooperative managed, but not owned, by Altisource. Lenders One’s earnings are included in revenue and reduced from net (loss) income to arrive at net (loss) income attributable to Altisource.
Strategy and Core Businesses
We are focused on becoming the premier provider of mortgage and real estate marketplaces and related technology enabled solutions to a broad and diversified customer base of residential real estate and loan investors, servicers, and originators. The real estate and mortgage marketplaces represent very large markets, and we believe our scale and suite of offerings provide us with competitive advantages that could support our growth. As we navigate the current state of the economy, interest rate environment, housing supply, and other macro-economic trends, we continue to evaluate our strategy and core businesses and seek to position our businesses to provide long term value to our customers and shareholders.
Each of our business segments provides Altisource the potential to grow and diversify our customer and revenue base. We believe these business segments address very large markets and directly leverage our core competencies and distinct competitive advantages. Our business segments and strategic initiatives follow:
Servicer and Real Estate:
Through our offerings that support residential real estate and loan investors and forward and reverse servicers, we provide a suite of loan default and real estate investor solutions and technologies intended to meet their growing and evolving needs. We are focused on gaining market share on existing solutions and launching new solutions with our existing customer base and attracting new customers to our offerings. We have a customer base that includes government-sponsored enterprises (“GSEs”), asset managers, and several large bank and non-bank servicers including Onity and Rithm. We believe we are one of only a few providers with a broad suite of solutions, nationwide coverage and scalability. Further, we believe we are well positioned to gain market share from existing and new customers if loan delinquency rates and foreclosure initiations and sales rise, or if they consolidate to larger, full-service providers or outsource services that have historically been performed in-house.
Origination:
Through our offerings that support mortgage loan originators (or other similar mortgage market participants), we provide a suite of solutions and technologies to meet the evolving and growing needs of lenders, mortgage purchasers and securitizers. We are focused on growing business from our existing customer base, attracting new customers to our offerings and developing new offerings. We have a customer base that includes the Lenders One cooperative members (Lenders One is a residential mortgage cooperative managed by Altisource), which includes independent mortgage bankers, credit unions, and banks, as well as bank and non-bank loan originators. We believe our suite of services, technologies and unique access to the members of the Lenders One mortgage cooperative position us to grow our relationships with our existing customer base by growing membership of Lenders One, increasing member adoption of existing solutions and developing and cross-selling new offerings. Further, we believe we are well positioned to gain market share from existing and new customers as customers and prospects look to Lenders One to help them improve their profitability and better compete.
Corporate and Others includes interest expense and costs related to corporate functions including executive, infrastructure and certain technology groups, finance, law, compliance, human resources, vendor management, facilities, risk management and eliminations between reportable segments.
Default Related Mortgage Market
Serious delinquency rates, foreclosure initiations and foreclosure sales are low relative to historical levels but have been increasing for the nine months ended September 30, 2025 relative to the same period in 2024. Additionally, foreclosure initiations and sales as a percentage of seriously delinquent loans for 2020 through 2025 are significantly lower than prior years. During 2020 and 2021, these percentages were significantly impacted by COVID-19 borrower relief measures, including foreclosure moratoriums and forbearance programs. These measures largely expired at the end of 2021. Beginning in 2022, we believe these percentages were impacted by servicer practices, home price appreciation, the interest rate environment, housing supply, the general state of the economy, and other factors. In 2021 and 2022, a low interest environment drove a high volume of refinance transactions and home prices appreciated significantly. Although interest rates began to increase in 2022, home prices remained high. With greater home equity from home price appreciation, we believe troubled borrowers have more
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options to avoid foreclosure. Foreclosure initiations and sales increased during the nine months ended September 30, 2025 compared to the same period in 2024. However, both measures remain below pre-pandemic levels.
While we cannot predict whether the default market will return to a pre-pandemic operating environment, we believe the demand for our Default business is likely to grow. We estimate that in today’s environment it typically takes on average two years to convert foreclosure initiations to foreclosure sales and six months to market and sell the REO. The foreclosure timelines could vary significantly based upon, for example, the state where the property is located, whether the foreclosure is contested, amount of borrower equity in the home and available borrower relief programs. The REO sale timelines could also vary significantly based upon, for example, mortgage interest rates, the local real estate market, whether the home is located in a redemption state and whether the home is occupied post foreclosure.
During 2024 and the nine months ended September 30, 2025, to address the close to historically low delinquency rates, we worked to (1) reduce our cost structure, (2) maintain the infrastructure to deliver default related services for our customer base and support the anticipated increase in demand should delinquency rates, foreclosure initiations and/or foreclosure sales rise, (3) launch a residential renovation business to renovate single family homes and launch a commercial real estate auction business on Hubzu, our online auction platform, and (4) launch new solutions and increase customer adoption of our existing solutions to accelerate the growth of our Origination segment.
Share Repurchase Program
On May 16, 2023, our shareholders approved the renewal and amendment of the share repurchase program previously approved by our shareholders on May 15, 2018. Under the program, we are authorized to purchase up to 0.4 million shares of our common stock, based on a limit of 15% of the outstanding shares of common stock on the date of approval, at a minimum price of $8.00 per share and a maximum price of $200.00 per share, until May 16, 2028. As of September 30, 2025, approximately 0.4 million shares of common stock remain available for repurchase under the program. In connection with the Share Consolidation, the Company purchased 204 shares of common stock during the nine months ended September 30, 2025. There were no other purchases of shares of common stock during the nine months ended September 30, 2025 and 2024. Under the new first lien loan facility (the “New Facility”) and the super senior credit facility (the “Super Senior Facility”), we are not permitted to repurchase shares except for limited circumstances.
Onity Related Matters
During the three and nine months ended September 30, 2025, Onity was our largest customer, accounting for 42% and 43% of our total revenue, respectively. Additionally, 5% of our revenue for the nine months ended September 30, 2025 (4% of our revenue for the third quarter of 2025) was earned on the loan portfolios serviced by Onity, when a party other than Onity or the mortgage servicing rights (“MSRs”) owner selected Altisource as the service provider.
Onity has disclosed that it is subject to a number of ongoing federal and state regulatory examinations, consent orders, inquiries, subpoenas, civil investigative demands, requests for information and other actions and is subject to pending and threatened legal proceedings, some of which include claims against Onity for substantial monetary damages. Previous regulatory actions against Onity have subjected Onity to independent oversight of its operations and placed certain restrictions on its ability to acquire servicing rights or proceed with default-related actions on the loans it services. Existing or future similar matters could result in adverse regulatory or other actions against Onity. In addition to the above, Onity may become subject to future adverse regulatory or other actions.
Onity has disclosed that Rithm is one of its largest servicing clients. As of June 30, 2025, Onity reported that approximately 11% of loans serviced and subserviced by Onity (measured in UPB) and approximately 59% of all delinquent loans that Onity services were related to Rithm MSRs or rights to MSRs.
The existence or outcome of Onity regulatory matters or the termination of Onity’s sub-servicing agreements with Rithm or other significant Onity clients may have significant adverse effects on Onity’s business. For example, Onity may be required to alter the way it conducts business, including the parties it contracts with for services, it may be required to seek changes to its existing pricing structure with us, it may lose its non-GSE servicing rights or subservicing arrangements or may lose one or more of its state servicing or origination licenses. Additional regulatory actions or adverse financial developments may impose additional restrictions on or require changes in Onity’s business that could require it to sell assets or change its business operations. Any or all of these effects and others could result in our eventual loss of Onity as a customer or a reduction in the number and/or volume of services it purchases from us or the loss of other customers.
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If any of the following events occurred, Altisource’s revenue could be significantly reduced and our results of operations could be materially adversely affected, including from the possible impairment or write-off of goodwill, intangible assets, property and equipment, other assets and accounts receivable:
•Altisource loses Onity as a customer or there is a significant reduction in the volume of services it purchases from us
•Onity loses, sells or transfers a significant portion of its GSE or Federal Housing Administration servicing rights or subservicing arrangements or remaining other servicing rights or subservicing arrangements and Altisource fails to be retained as a service provider
•The contractual relationship between Onity and Rithm changes significantly, including Onity’s sub-servicing arrangement with Rithm expiring without renewal, and this change results in a change in our status as a provider of services related to the Subject MSRs
•Onity loses state servicing licenses in states with a significant number of loans in Onity’s servicing portfolio
•Onity is subject to stays, moratoriums, suspensions or other restrictions that limit or delay default-related actions on the loans it services
•The contractual relationship between Onity and Altisource changes significantly or there are significant changes to our pricing to Onity for services from which we generate material revenue
•Altisource otherwise fails to be retained as a service provider and/or there is a reduction in referral volumes.
The foregoing list is not intended to be exhaustive. Management cannot predict whether any of these events or other events will occur or the amount of any impact they may have on Altisource.
Factors Affecting Comparability
The following items impact the comparability of our results:
•Industrywide foreclosure initiations were 19% higher for the eight months ended August 31, 2025 compared to the same period in 2024 (and 21% lower than the same pre-COVID-19 period in 2019)
•Industrywide foreclosure sales were 10% higher for the eight months ended August 31, 2025 compared to the same period in 2024 (and 49% lower than the same pre-COVID-19 period in 2019)
•Industrywide mortgage origination volume increased by 17% for the nine months ended September 30, 2025 compared to the same period in 2024, comprised of a 4% decline in purchase origination and a 103% increase in refinancing origination
•On February 19, 2025, Altisource Portfolio Solutions S.A. and Altisource S.à r.l. (the “Borrower”) entered into agreements with 100% of the lenders under the SSTL (the “Lenders”). Under these agreements, the Lenders exchanged the senior secured term loans (“SSTL”) with an outstanding balance of $232.8 million for a $160.0 million New Facility and 7.3 million shares of common stock (the “Debt Exchange Shares”) (collectively, the “Debt Exchange Transaction”). The New Facility is comprised of a $110.0 million interest-bearing loan (the “New Debt”) and a $50.0 million non-interest-bearing exit fee. In connection with the Debt Exchange Transaction, the Company expensed $3.6 million relating to fees paid to advisors and others
•The weighted average interest rate on the Company’s long-term debt was 12.35% for the nine months ended September 30, 2025 compared to 14.18% for the same period in 2024
•The Company recognized an income tax benefit (provision) of $15.1 million and $(2.2) million for the nine months ended September 30, 2025 and 2024, respectively ($(0.7) million and $(0.8) million for the third quarter of 2025 and 2024, respectively). The income tax benefit for the nine months ended September 30, 2025 was driven primarily by the reversal of liabilities for uncertain tax positions. The income tax (provision) benefit for the three and nine months ended September 30, 2025 was also driven by income tax expense on transfer pricing income from India and the United States and no tax benefit on the pretax loss from our Luxembourg operating company. For further information, see Note 19.
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CONSOLIDATED RESULTS OF OPERATIONS
Summary Results
The following is a discussion of our consolidated results of operations for the periods indicated. For a more detailed discussion of the factors that affected the results of our business segments in these periods, see “Segment Results of Operations” below.
The following table sets forth information on our consolidated results of operations:
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||||||||||||||||||||
| (in thousands, except per share data) | 2025 | 2024 | % Increase (decrease) | 2025 | 2024 | % Increase (decrease) | ||||||||||||||||||||||||||||||||
| Service revenue: | ||||||||||||||||||||||||||||||||||||||
| Servicer and Real Estate | $ | 31,175 | $ | 30,389 | 3 | $ | 95,992 | $ | 88,495 | 8 | ||||||||||||||||||||||||||||
| Origination | 8,491 | 7,761 | 9 | 25,356 | 23,409 | 8 | ||||||||||||||||||||||||||||||||
| Total service revenue | 39,666 | 38,150 | 4 | 121,348 | 111,904 | 8 | ||||||||||||||||||||||||||||||||
| Reimbursable expenses | 2,171 | 2,321 | (6) | 7,067 | 7,081 | — | ||||||||||||||||||||||||||||||||
| Non-controlling interests | 71 | 60 | 18 | 220 | 136 | 62 | ||||||||||||||||||||||||||||||||
| Total revenue | 41,908 | 40,531 | 3 | 128,635 | 119,121 | 8 | ||||||||||||||||||||||||||||||||
| Cost of revenue | 30,561 | 28,461 | 7 | 90,936 | 82,030 | 11 | ||||||||||||||||||||||||||||||||
| Gross profit | 11,347 | 12,070 | (6) | 37,699 | 37,091 | 2 | ||||||||||||||||||||||||||||||||
| Selling, general and administrative expenses | 10,826 | 10,965 | (1) | 30,702 | 34,451 | (11) | ||||||||||||||||||||||||||||||||
| Income from operations | 521 | 1,105 | (53) | 6,997 | 2,640 | 165 | ||||||||||||||||||||||||||||||||
| Other income (expense), net: | ||||||||||||||||||||||||||||||||||||||
| Interest expense | (2,368) | (9,960) | (76) | (9,921) | (29,277) | (66) | ||||||||||||||||||||||||||||||||
| Debt exchange transaction expenses | (194) | — | N/M | (3,646) | — | N/M | ||||||||||||||||||||||||||||||||
| Other income (expense), net | 376 | 362 | 4 | 563 | 2,143 | (74) | ||||||||||||||||||||||||||||||||
| Total other income (expense), net | (2,186) | (9,598) | (77) | (13,004) | (27,134) | (52) | ||||||||||||||||||||||||||||||||
| Loss before income taxes and non-controlling interests | (1,665) | (8,493) | 80 | (6,007) | (24,494) | 75 | ||||||||||||||||||||||||||||||||
| Income tax (provision) benefit | (660) | (809) | 18 | 15,069 | (2,237) | N/M | ||||||||||||||||||||||||||||||||
| Net (loss) income | (2,325) | (9,302) | 75 | 9,062 | (26,731) | 134 | ||||||||||||||||||||||||||||||||
| Net income attributable to non-controlling interests | (71) | (60) | (18) | (220) | (136) | (62) | ||||||||||||||||||||||||||||||||
| Net (loss) income attributable to Altisource | $ | (2,396) | $ | (9,362) | 74 | $ | 8,842 | $ | (26,867) | 133 | ||||||||||||||||||||||||||||
| Margins: | ||||||||||||||||||||||||||||||||||||||
| Gross profit / service revenue | 29 | % | 32 | % | 31 | % | 33 | % | ||||||||||||||||||||||||||||||
| Income from operations / service revenue | 1 | % | 3 | % | 6 | % | 2 | % | ||||||||||||||||||||||||||||||
| (Loss) earnings per share: | ||||||||||||||||||||||||||||||||||||||
| Basic | $ | (0.22) | $ | (2.61) | 92 | $ | 0.91 | $ | (7.55) | 112 | ||||||||||||||||||||||||||||
| Diluted | $ | (0.22) | $ | (2.61) | 92 | $ | 0.81 | $ | (7.55) | 111 | ||||||||||||||||||||||||||||
| Weighted average shares outstanding: | ||||||||||||||||||||||||||||||||||||||
| Basic | 10,988 | 3,584 | 207 | 9,755 | 3,559 | 174 | ||||||||||||||||||||||||||||||||
| Diluted | 10,988 | 3,584 | 207 | 10,890 | 3,559 | 206 | ||||||||||||||||||||||||||||||||
_____________________________________
N/M — not meaningful.
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Revenue
We recognized service revenue of $121.3 million for the nine months ended September 30, 2025, an 8% increase compared to the nine months ended September 30, 2024 ($39.7 million for the third quarter of 2025, a 4% increase compared to the third quarter of 2024). The increase in service revenue for the three and nine months ended September 30, 2025 was primarily driven by higher revenue in both segments. Revenue was higher in the Servicer and Real Estate segment from growth in our Property Renovation Services, Foreclosure Trustee, Granite and Field Services businesses in the Solutions business, partially offset by fewer home sales in the Marketplace business and lower professional services revenue in the Equator business within the Technology and SaaS products. Revenue was higher in the Origination segment from growth in reseller products in the Lenders One business and, for the nine months ended September 30, 2025, higher volumes in the loan fulfillment services business within the Solutions business.
We recognized reimbursable expenses revenue of $7.1 million for the nine months ended September 30, 2025, a less than 1% decrease compared to the nine months ended September 30, 2024 ($2.2 million for the third quarter of 2025, a 6% decrease compared to the third quarter of 2024). The decrease in reimbursable expenses for the three and nine months ended September 30, 2025 was primarily driven by fewer asset resolution and asset management activities in the Marketplace business and a decrease in property preservation services in our Field Services business in the Servicer and Real Estate Solutions business partially offset by growth in the Foreclosure Trustee business in the Solutions business within the Servicer and Real Estate segment. For the nine months ended September 30, 2025, the decrease in reimbursable expenses was also from lower REO title related expenses in our Title business in the Solutions business.
Certain of our revenues can be impacted by seasonality. More specifically, revenues from property sales, loan originations and certain property preservation services in field services typically tend to be at their lowest level during the fall and winter months and at their highest level during the spring and summer months. However, as a result of the current default market, home price appreciation and higher mortgage interest rates, the seasonal impact to revenue may not follow historical patterns.
Cost of Revenue and Gross Profit
Cost of revenue principally includes payroll and employee benefits associated with personnel employed in customer service, operations and technology roles, fees paid to external providers related to the provision of services, reimbursable expenses, technology and telecommunications costs as well as depreciation and amortization of operating assets.
Cost of revenue consists of the following:
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||||||||||||||||||||
| (in thousands) | 2025 | 2024 | % Increase (decrease) | 2025 | 2024 | % Increase (decrease) | ||||||||||||||||||||||||||||||||
| Outside fees and services | $ | 17,261 | $ | 15,534 | 11 | $ | 51,757 | $ | 44,301 | 17 | ||||||||||||||||||||||||||||
| Compensation and benefits | 8,112 | 7,457 | 9 | 22,971 | 21,913 | 5 | ||||||||||||||||||||||||||||||||
| Technology and telecommunications | 2,945 | 3,026 | (3) | 8,830 | 8,256 | 7 | ||||||||||||||||||||||||||||||||
| Reimbursable expenses | 2,171 | 2,321 | (6) | 7,067 | 7,081 | — | ||||||||||||||||||||||||||||||||
| Depreciation and amortization | 72 | 123 | (41) | 311 | 479 | (35) | ||||||||||||||||||||||||||||||||
| Cost of revenue | $ | 30,561 | $ | 28,461 | 7 | $ | 90,936 | $ | 82,030 | 11 | ||||||||||||||||||||||||||||
We recognized cost of revenue of $90.9 million for the nine months ended September 30, 2025, an 11% increase compared to the nine months ended September 30, 2024 ($30.6 million for the third quarter of 2025, a 7% increase compared to the third quarter of 2024). Outside fees and services for the three and nine months ended September 30, 2025 increased primarily from service revenue growth in the Property Renovations Services, Foreclosure Trustee and Field Services businesses within the Servicer and Real Estate segment and service revenue growth in the Lenders One business in the Origination segment. Compensation and benefits for the three and nine months ended September 30, 2025 increased primarily due to growth in the Property Renovation Services business and higher annual incentive compensation accruals. Technology and telecommunications for the nine months ended September 30, 2025 increased primarily from a benefit recognized in 2024. Depreciation and amortization was lower for the three and nine months ended September 30, 2025 from the completion of the depreciation periods of certain premises and equipment with only modest additions. In addition, changes in reimbursable expenses for the three and nine months ended September 30, 2024 are consistent with the changes in reimbursable expenses revenue discussed in the revenue section above.
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Gross profit increased to $37.7 million, representing 31% of service revenue, for the nine months ended September 30, 2025 compared to $37.1 million, representing 33% of service revenue, for the nine months ended September 30, 2024 (decreased to $11.3 million, representing 29% of service revenue, for the third quarter of 2025, compared to $12.1 million, representing 32% of service revenue, for the third quarter of 2024). Gross profit as a percentage of service revenue for the nine months ended September 30, 2025 decreased compared to the three and nine months ended September 30, 2024 primarily due to a change in revenue mix from greater growth in the lower margin Property Renovations Services business and Lenders One businesses than in the higher margin Foreclosure Trustee business and Hubzu business. Our margins can vary substantially depending upon the service revenue mix.
Selling, General and Administrative Expenses
Selling, general and administrative (“SG&A”) expenses include payroll for personnel employed in executive, sales and marketing, finance, technology, law, compliance, audit, human resources, vendor management, facilities and risk management roles. This category also includes professional services fees, occupancy costs, marketing costs, depreciation and amortization of non-operating assets and other expenses.
SG&A expenses consist of the following:
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||||||||||||||||||||
| (in thousands) | 2025 | 2024 | % Increase (decrease) | 2025 | 2024 | % Increase (decrease) | ||||||||||||||||||||||||||||||||
| Compensation and benefits | $ | 5,206 | $ | 4,413 | 18 | $ | 15,111 | $ | 14,765 | 2 | ||||||||||||||||||||||||||||
| Professional services | 1,581 | 2,547 | (38) | 4,009 | 7,160 | (44) | ||||||||||||||||||||||||||||||||
| Amortization of intangible assets | 1,270 | 1,270 | — | 3,810 | 3,810 | — | ||||||||||||||||||||||||||||||||
| Occupancy related costs | 875 | 801 | 9 | 2,541 | 2,776 | (8) | ||||||||||||||||||||||||||||||||
| Marketing costs | 593 | 489 | 21 | 1,719 | 1,536 | 12 | ||||||||||||||||||||||||||||||||
| Depreciation and amortization | 8 | 99 | (92) | 132 | 315 | (58) | ||||||||||||||||||||||||||||||||
| Other | 1,293 | 1,346 | (4) | 3,380 | 4,089 | (17) | ||||||||||||||||||||||||||||||||
| Selling, general and administrative expenses | $ | 10,826 | $ | 10,965 | (1) | $ | 30,702 | $ | 34,451 | (11) | ||||||||||||||||||||||||||||
SG&A expenses for the nine months ended September 30, 2025 of $30.7 million decreased by 11% compared to the nine months ended September 30, 2024 ($10.8 million for the third quarter of 2025, a 1% decrease compared to the third quarter of 2024). The decrease in SG&A for the three and nine months ended September 30, 2025 was primarily driven by lower professional services and other SG&A expenses, partially offset by higher compensation and benefits. Professional services for the three and nine months ended September 30, 2025 decreased primarily due to lower costs related to legacy indemnification accruals. Other SG&A expenses for the three and nine months ended September 30, 2025 decreased primarily due to lower bad debt expense. Compensation and benefits for the nine months ended September 30, 2025 increased primarily from higher annual incentive compensation accruals, partially offset by lower share based compensation. Compensation and benefits for the three months ended September 30, 2025 increased from higher annual incentive compensation accruals and higher share based compensation.
Income from operations
Income from operations for the nine months ended September 30, 2025 was $7.0 million, representing 6% of service revenue, compared to $2.6 million, representing 2% of service revenue, for the nine months ended September 30, 2024 (decreased to $0.5 million, representing 1% of service revenue, for the third quarter of 2025, compared to $1.1 million representing 3% of service revenue for the third quarter of 2024). Income from operations as a percentage of service revenue improved for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 primarily as a result of lower SG&A expenses as a percentage of service revenue, partially offset by lower gross profit margins. Income from operations as a percentage of service revenue decreased for the three months ended September 30, 2025 compared to the three months ended September 30, 2024 primarily from lower gross profit margins.
Other Income (Expense), net
Other income (expense), net principally includes interest expense and other non-operating gains and losses.
Other income (expense), net was $(13.0) million for the nine months ended September 30, 2025 compared to $(27.1) million for the nine months ended September 30, 2024 ($(2.2) million for the third quarter of 2025 and $(9.6) million for the third
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quarter of 2024). The change for the three and nine months ended September 30, 2025 was primarily driven by lower interest expense, partially offset by higher debt exchange transaction expenses. The lower interest expense was driven by the decrease in outstanding debt and a lower interest rate from the February 19, 2025 Debt Exchange Transaction.
Income Tax Provision
We recognized an income tax benefit (provision) of $15.1 million and $(2.2) million for the nine months ended September 30, 2025 and 2024, respectively ($(0.7) million and $(0.8) million for the third quarter of 2025 and 2024, respectively). The income tax (provision) benefit for the nine months ended September 30, 2025 was driven primarily by the reversal of liabilities for uncertain tax positions. The income tax (provision) benefit for the three and nine months ended September 30, 2025 was also driven by income tax expense on transfer pricing income from India and the United States and no tax benefit on the pretax loss from our Luxembourg operating company. For further information, see Note 19.
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SEGMENT RESULTS OF OPERATIONS
The following section provides a discussion of pretax results of operations of our business segments. Transactions between segments are accounted for as third party arrangements for purposes of presenting segment results of operations.
Financial information for our segments was as follows:
| Three months ended September 30, 2025 | ||||||||||||||||||||||||||
| (in thousands) | Servicer and Real Estate | Origination | Corporate and Others | Consolidated Altisource | ||||||||||||||||||||||
| Revenue | ||||||||||||||||||||||||||
| Service revenue | $ | 31,175 | $ | 8,491 | $ | — | $ | 39,666 | ||||||||||||||||||
| Reimbursable expenses | 2,067 | 104 | — | 2,171 | ||||||||||||||||||||||
| Non-controlling interests | — | 71 | — | 71 | ||||||||||||||||||||||
| 33,242 | 8,666 | — | 41,908 | |||||||||||||||||||||||
| Cost of revenue | 21,977 | 6,984 | 1,600 | 30,561 | ||||||||||||||||||||||
| Gross profit (loss) | 11,265 | 1,682 | (1,600) | 11,347 | ||||||||||||||||||||||
| Selling, general and administrative expenses | 2,344 | 2,040 | 6,442 | 10,826 | ||||||||||||||||||||||
| Income (loss) from operations | 8,921 | (358) | (8,042) | 521 | ||||||||||||||||||||||
| Total other income (expense), net | 53 | — | (2,239) | (2,186) | ||||||||||||||||||||||
| Income (loss) before income taxes and non-controlling interests | $ | 8,974 | $ | (358) | $ | (10,281) | $ | (1,665) | ||||||||||||||||||
| Margins: | ||||||||||||||||||||||||||
| Gross profit (loss) / service revenue | 36 | % | 20 | % | N/M | 29 | % | |||||||||||||||||||
| Income (loss) from operations / service revenue | 29 | % | (4) | % | N/M | 1 | % | |||||||||||||||||||
N/M — not meaningful.
| Three months ended September 30, 2024 | ||||||||||||||||||||||||||
| (in thousands) | Servicer and Real Estate | Origination | Corporate and Others | Consolidated Altisource | ||||||||||||||||||||||
| Revenue | ||||||||||||||||||||||||||
| Service revenue | $ | 30,389 | $ | 7,761 | $ | — | $ | 38,150 | ||||||||||||||||||
| Reimbursable expenses | 2,160 | 161 | — | 2,321 | ||||||||||||||||||||||
| Non-controlling interests | — | 60 | — | 60 | ||||||||||||||||||||||
| 32,549 | 7,982 | — | 40,531 | |||||||||||||||||||||||
| Cost of revenue | 20,509 | 6,312 | 1,640 | 28,461 | ||||||||||||||||||||||
| Gross profit (loss) | 12,040 | 1,670 | (1,640) | 12,070 | ||||||||||||||||||||||
| Selling, general and administrative expenses | 3,194 | 1,325 | 6,446 | 10,965 | ||||||||||||||||||||||
| Income (loss) from operations | 8,846 | 345 | (8,086) | 1,105 | ||||||||||||||||||||||
| Total other income (expense), net | 62 | — | (9,660) | (9,598) | ||||||||||||||||||||||
| Income (loss) before income taxes and non-controlling interests | $ | 8,908 | $ | 345 | $ | (17,746) | $ | (8,493) | ||||||||||||||||||
| Margins: | ||||||||||||||||||||||||||
| Gross profit (loss) / service revenue | 40 | % | 22 | % | N/M | 32 | % | |||||||||||||||||||
| Income (loss) from operations / service revenue | 29 | % | 4 | % | N/M | 3 | % | |||||||||||||||||||
N/M — not meaningful.
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Nine months ended September 30, 2025 | ||||||||||||||||||||||||||
| (in thousands) | Servicer and Real Estate | Origination | Corporate and Others | Consolidated Altisource | ||||||||||||||||||||||
| Revenue | ||||||||||||||||||||||||||
| Service revenue | $ | 95,992 | $ | 25,356 | $ | — | $ | 121,348 | ||||||||||||||||||
| Reimbursable expenses | 6,605 | 462 | — | 7,067 | ||||||||||||||||||||||
| Non-controlling interests | — | 220 | — | 220 | ||||||||||||||||||||||
| 102,597 | 26,038 | — | 128,635 | |||||||||||||||||||||||
| Cost of revenue | 65,724 | 20,453 | 4,759 | 90,936 | ||||||||||||||||||||||
| Gross profit (loss) | 36,873 | 5,585 | (4,759) | 37,699 | ||||||||||||||||||||||
| Selling, general and administrative expenses | 5,707 | 5,463 | 19,532 | 30,702 | ||||||||||||||||||||||
| Income (loss) from operations | 31,166 | 122 | (24,291) | 6,997 | ||||||||||||||||||||||
| Total other income (expense), net | 8 | — | (13,012) | (13,004) | ||||||||||||||||||||||
| Income (loss) before income taxes and non-controlling interests | $ | 31,174 | $ | 122 | $ | (37,303) | $ | (6,007) | ||||||||||||||||||
| Margins: | ||||||||||||||||||||||||||
| Gross profit (loss) / service revenue | 38 | % | 22 | % | N/M | 31 | % | |||||||||||||||||||
| Income (loss) from operations / service revenue | 32 | % | — | % | N/M | 6 | % | |||||||||||||||||||
_____________________________________
N/M — not meaningful.
Nine months ended September 30, 2024 | ||||||||||||||||||||||||||
| (in thousands) | Servicer and Real Estate | Origination | Corporate and Others | Consolidated Altisource | ||||||||||||||||||||||
| Revenue | ||||||||||||||||||||||||||
| Service revenue | $ | 88,495 | $ | 23,409 | $ | — | $ | 111,904 | ||||||||||||||||||
| Reimbursable expenses | 6,680 | 401 | — | 7,081 | ||||||||||||||||||||||
| Non-controlling interests | — | 136 | — | 136 | ||||||||||||||||||||||
| 95,175 | 23,946 | — | 119,121 | |||||||||||||||||||||||
| Cost of revenue | 58,357 | 18,801 | 4,872 | 82,030 | ||||||||||||||||||||||
| Gross profit (loss) | 36,818 | 5,145 | (4,872) | 37,091 | ||||||||||||||||||||||
| Selling, general and administrative expenses | 8,687 | 5,030 | 20,734 | 34,451 | ||||||||||||||||||||||
| Income (loss) from operations | 28,131 | 115 | (25,606) | 2,640 | ||||||||||||||||||||||
| Total other income (expense), net | 61 | — | (27,195) | (27,134) | ||||||||||||||||||||||
| Income (loss) before income taxes and non-controlling interests | $ | 28,192 | $ | 115 | $ | (52,801) | $ | (24,494) | ||||||||||||||||||
| Margins: | ||||||||||||||||||||||||||
| Gross profit (loss) / service revenue | 42 | % | 22 | % | N/M | 33 | % | |||||||||||||||||||
| Income (loss) from operations / service revenue | 32 | % | — | % | N/M | 2 | % | |||||||||||||||||||
_____________________________________
N/M — not meaningful.
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Servicer and Real Estate
Revenue
Revenue by line of business was as follows:
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||||||||||||||||||||
| (in thousands) | 2025 | 2024 | % Increase (decrease) | 2025 | 2024 | % Increase (decrease) | ||||||||||||||||||||||||||||||||
| Service revenue: | ||||||||||||||||||||||||||||||||||||||
| Solutions | $ | 23,186 | $ | 21,090 | 10 | $ | 70,300 | $ | 59,546 | 18 | ||||||||||||||||||||||||||||
| Marketplace | 5,691 | 6,406 | (11) | 18,708 | 20,915 | (11) | ||||||||||||||||||||||||||||||||
| Technology and SaaS Products | 2,298 | 2,893 | (21) | 6,984 | 8,034 | (13) | ||||||||||||||||||||||||||||||||
| Total service revenue | 31,175 | 30,389 | 3 | 95,992 | 88,495 | 8 | ||||||||||||||||||||||||||||||||
| Reimbursable expenses: | ||||||||||||||||||||||||||||||||||||||
| Solutions | 1,159 | 1,085 | 7 | 3,454 | 3,308 | 4 | ||||||||||||||||||||||||||||||||
| Marketplace | 908 | 1,075 | (16) | 3,151 | 3,372 | (7) | ||||||||||||||||||||||||||||||||
| Total reimbursable expenses | 2,067 | 2,160 | (4) | 6,605 | 6,680 | (1) | ||||||||||||||||||||||||||||||||
| Total revenue | $ | 33,242 | $ | 32,549 | 2 | $ | 102,597 | $ | 95,175 | 8 | ||||||||||||||||||||||||||||
We recognized service revenue of $96.0 million for the nine months ended September 30, 2025, an 8% increase compared to the nine months ended September 30, 2024 ($31.2 million for the third quarter of 2025, a 3% increase compared to the third quarter of 2024). We also recognized reimbursable expenses revenue of $6.6 million for the nine months ended September 30, 2025, a 1% decrease compared to the nine months ended September 30, 2024 ($2.1 million for the third quarter of 2025, a 4% decrease compared to the third quarter of 2024). The increase in service revenue for the three and nine months ended September 30, 2025 was driven by growth in our Property Renovation Services, Foreclosure Trustee businesses, Granite and Field Services businesses in the Solutions business, partially offset by fewer home sales in the Marketplace business and lower professional services revenue in the Equator business within the Technology and SaaS products business. The decrease in reimbursable expenses for the three and nine months ended September 30, 2025 was primarily driven by fewer asset resolution and asset management activities in the Marketplace business and a decrease in property preservation services in our Field Services business partially offset by growth in the Foreclosure Trustee business in the Solutions business. For the nine months ended September 30, 2025, the decrease in reimbursable expenses was also from lower REO title related expenses in our Title business in the Solutions business.
Certain of our Servicer and Real Estate businesses are impacted by seasonality. Revenues from property sales and certain property preservation services are generally lowest during the fall and winter months and highest during the spring and summer months. However, as a result of the current default market, home price appreciation and higher mortgage interest rates, the seasonal impact to revenue may not follow historical patterns.
Cost of Revenue and Gross Profit
Cost of revenue consisted of the following:
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||||||||||||||||||||
| (in thousands) | 2025 | 2024 | % Increase (decrease) | 2025 | 2024 | % Increase (decrease) | ||||||||||||||||||||||||||||||||
| Outside fees and services | $ | 11,686 | $ | 10,778 | 8 | $ | 35,575 | $ | 29,662 | 20 | ||||||||||||||||||||||||||||
| Compensation and benefits | 6,276 | 5,590 | 12 | 17,623 | 16,569 | 6 | ||||||||||||||||||||||||||||||||
| Reimbursable expenses | 2,067 | 2,159 | (4) | 6,605 | 6,679 | (1) | ||||||||||||||||||||||||||||||||
| Technology and telecommunications | 1,898 | 1,905 | — | 5,724 | 5,200 | 10 | ||||||||||||||||||||||||||||||||
| Depreciation and amortization | 50 | 77 | (35) | 197 | 247 | (20) | ||||||||||||||||||||||||||||||||
| Cost of revenue | $ | 21,977 | $ | 20,509 | 7 | $ | 65,724 | $ | 58,357 | 13 | ||||||||||||||||||||||||||||
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Cost of revenue for the nine months ended September 30, 2025 of $65.7 million increased by 13% compared to the nine months ended September 30, 2024 ($22.0 million for the third quarter of 2025, a 7% increase compared to the third quarter of 2024). The increase in cost of revenue for the three and nine months ended September 30, 2025 was primarily driven by higher outside fees and services and compensation and benefits. The increase in cost of revenue for the nine months ended September 30, 2025 was also from higher technology and telecommunications. Outside fees and services for the three and nine months ended September 30, 2025 increased from service revenue growth in the Property Renovation Services, Foreclosure Trustee and Field Services businesses in the Solutions business. Compensation and benefits for the three and nine months ended September 30, 2025 increased primarily due to growth in the Property Renovation Services business and higher annual incentive compensation accruals. Technology and telecommunications for the nine months ended September 30, 2025 increased from higher cloud services costs from higher volumes and from a benefit recognized in the first quarter of 2024.
Gross profit increased to $36.9 million, representing 38% of service revenue, for the nine months ended September 30, 2025 compared to $36.8 million, representing 42% of service revenue, for the nine months ended September 30, 2024 (decreased to $11.3 million, representing 36% of service revenue, for the third quarter of 2025, compared to $12.0 million, representing 40% of service revenue, for the third quarter of 2024). Gross profit as a percentage of service revenue for the three and nine months ended September 30, 2025 decreased primarily due to a change in revenue mix from greater growth in the lower margin Property Renovations Services business than in the higher margin Foreclosure Trustee business in the Solutions business and fewer homes sales in the Marketplace business. Our margins can vary substantially depending upon the service revenue mix.
Selling, General and Administrative Expenses
SG&A expenses consisted of the following:
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||||||||||||||||||||
| (in thousands) | 2025 | 2024 | % Increase (decrease) | 2025 | 2024 | % Increase (decrease) | ||||||||||||||||||||||||||||||||
| Professional services | $ | 421 | $ | 1,082 | (61) | $ | 180 | $ | 2,734 | (93) | ||||||||||||||||||||||||||||
| Amortization of intangible assets | 740 | 740 | — | 2,220 | 2,220 | — | ||||||||||||||||||||||||||||||||
| Compensation and benefits | 491 | 473 | 4 | 1,445 | 1,497 | (3) | ||||||||||||||||||||||||||||||||
| Marketing costs | 278 | 296 | (6) | 960 | 969 | (1) | ||||||||||||||||||||||||||||||||
| Occupancy related costs | 108 | 122 | (11) | 323 | 434 | (26) | ||||||||||||||||||||||||||||||||
| Depreciation and amortization | — | — | — | 1 | 1 | — | ||||||||||||||||||||||||||||||||
| Other | 306 | 481 | (36) | 578 | 832 | (31) | ||||||||||||||||||||||||||||||||
| Selling, general and administrative expenses | $ | 2,344 | $ | 3,194 | (27) | $ | 5,707 | $ | 8,687 | (34) | ||||||||||||||||||||||||||||
N/M — not meaningful.
SG&A for the nine months ended September 30, 2025 of $5.7 million decreased by 34% compared to the nine months ended September 30, 2024 ($2.3 million for the third quarter of 2025, a 27% decrease compared to the third quarter of 2024). The decrease in SG&A for the three and nine months ended September 30, 2025 was primarily due to lower professional services. Professional services for the nine months ended September 30, 2025 decreased primarily due to a settlement received related to a legacy matter and lower costs related to legacy indemnification accruals. Professional services for the three months ended September 30, 2025 decreased primarily due to lower costs related to legacy indemnification accruals.
Income from operations
Income from operations increased to $31.2 million, representing 32% of service revenue, for the nine months ended September 30, 2025 compared to $28.1 million, representing 32% of service revenue, for the nine months ended September 30, 2024 (increased to $8.9 million, representing 29% of service revenue, for the third quarter of 2025, compared to $8.8 million, representing 29% of service revenue for the third quarter of 2024). Operating income as a percentage of service revenue for the three and nine months ended September 30, 2025 remained flat compared to September 30, 2024 as a result of lower SG&A expenses, offset by lower gross profit margins.
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Origination
Revenue
Revenue by business unit was as follows:
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||||||||||||||||||||
| (in thousands) | 2025 | 2024 | % Increase (decrease) | 2025 | 2024 | % Increase (decrease) | ||||||||||||||||||||||||||||||||
| Service revenue: | ||||||||||||||||||||||||||||||||||||||
| Lenders One | $ | 6,781 | $ | 5,937 | 14 | $ | 20,008 | $ | 18,680 | 7 | ||||||||||||||||||||||||||||
| Solutions | 1,547 | 1,657 | (7) | 4,808 | 4,248 | 13 | ||||||||||||||||||||||||||||||||
| Technology and SaaS Products | 163 | 167 | (2) | 540 | 481 | 12 | ||||||||||||||||||||||||||||||||
| Total service revenue | 8,491 | 7,761 | 9 | 25,356 | 23,409 | 8 | ||||||||||||||||||||||||||||||||
| Reimbursable expenses: | ||||||||||||||||||||||||||||||||||||||
| Solutions | 104 | 161 | (35) | 462 | 401 | 15 | ||||||||||||||||||||||||||||||||
| Total reimbursable expenses | 104 | 161 | (35) | 462 | 401 | 15 | ||||||||||||||||||||||||||||||||
| Non-controlling interests | 71 | 60 | 18 | 220 | 136 | 62 | ||||||||||||||||||||||||||||||||
| Total revenue | $ | 8,666 | $ | 7,982 | 9 | $ | 26,038 | $ | 23,946 | 9 | ||||||||||||||||||||||||||||
We recognized service revenue of $25.4 million for the nine months ended September 30, 2025, an 8% increase compared to the nine months ended September 30, 2024 ($8.5 million for the third quarter of 2025, a 9% increase compared to the third quarter of 2024). We also recognized reimbursable expenses revenue of $0.5 million for the nine months ended September 30, 2025, a 15% increase compared to the nine months ended September 30, 2024 ($0.1 million for the third quarter of 2025, a 35% decrease compared to the third quarter of 2024). The increase in service revenue in the Origination segment for the nine months ended September 30, 2025 was primarily driven by growth in reseller products in the Lenders One business and higher volumes in the loan fulfillment services business within the Solutions business. The increase in service revenue for the three months ended September 30, 2025 was primarily driven by growth in reseller products in the Lenders One business partially offset by lower volumes in the loan fulfillment services business within the Solutions business. The increase in reimbursable expenses for the nine months ended September 30, 2025 was primarily driven by certain Title orders partially offset by lower volumes in the loan fulfillment services business within the Solutions business. The decrease in reimbursable expenses for the three months ended September 30, 2025 was primarily driven by lower volumes in the loan fulfillment services business within the Solutions business.
Cost of Revenue and Gross Profit
Cost of revenue consisted of the following:
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||||||||||||||||||||
| (in thousands) | 2025 | 2024 | % Increase (decrease) | 2025 | 2024 | % Increase (decrease) | ||||||||||||||||||||||||||||||||
| Outside fees and services | $ | 5,575 | $ | 4,756 | 17 | $ | 16,182 | $ | 14,639 | 11 | ||||||||||||||||||||||||||||
| Compensation and benefits | 1,107 | 1,170 | (5) | 3,218 | 3,238 | (1) | ||||||||||||||||||||||||||||||||
| Technology and telecommunications | 196 | 220 | (11) | 583 | 505 | 15 | ||||||||||||||||||||||||||||||||
| Reimbursable expenses | 104 | 162 | (36) | 462 | 402 | 15 | ||||||||||||||||||||||||||||||||
| Depreciation and amortization | 2 | 4 | (50) | 8 | 17 | (53) | ||||||||||||||||||||||||||||||||
| Cost of revenue | $ | 6,984 | $ | 6,312 | 11 | $ | 20,453 | $ | 18,801 | 9 | ||||||||||||||||||||||||||||
Cost of revenue for the nine months ended September 30, 2025 of $20.5 million increased by 9% compared to the nine months ended September 30, 2024 ($7.0 million for the third quarter of 2025, an 11% increase compared to the third quarter of 2024). The increase in cost of revenue for the three and nine months ended September 30, 2025 was primarily driven by higher outside fees and services from growth in the reseller products in the Lenders One business.
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Gross profit increased to $5.6 million, representing 22% of service revenue, for the nine months ended September 30, 2025 compared to $5.1 million, representing 22% of service revenue, for the nine months ended September 30, 2024 (remained relatively flat at $1.7 million, representing 20% of service revenue, for the third quarter of 2025, compared to $1.7 million, representing 22% of service revenue for the third quarter of 2024). Gross profit as a percentage of service revenue for the nine months ended September 30, 2025 was relatively flat compared to the nine months ended September 30, 2024. Gross profit as a percentage of service revenue for the three months ended September 30, 2025 decreased compared to the three months ended September 30, 2024 from revenue mix.
Selling, General and Administrative Expenses
SG&A expenses consisted of the following:
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||||||||||||||||||||
| (in thousands) | 2025 | 2024 | % Increase (decrease) | 2025 | 2024 | % Increase (decrease) | ||||||||||||||||||||||||||||||||
| Amortization of intangible assets | $ | 530 | $ | 530 | — | $ | 1,590 | $ | 1,590 | — | ||||||||||||||||||||||||||||
| Compensation and benefits | 574 | 440 | 30 | 1,569 | 1,405 | 12 | ||||||||||||||||||||||||||||||||
| Professional services | 399 | 69 | N/M | 943 | 350 | 169 | ||||||||||||||||||||||||||||||||
| Marketing costs | 315 | 193 | 63 | 759 | 562 | 35 | ||||||||||||||||||||||||||||||||
| Occupancy related costs | 46 | 68 | (32) | 148 | 311 | (52) | ||||||||||||||||||||||||||||||||
| Depreciation and amortization | 1 | — | N/M | 1 | 1 | — | ||||||||||||||||||||||||||||||||
| Other | 175 | 25 | N/M | 453 | 811 | (44) | ||||||||||||||||||||||||||||||||
| Selling, general and administrative expenses | $ | 2,040 | $ | 1,325 | 54 | $ | 5,463 | $ | 5,030 | 9 | ||||||||||||||||||||||||||||
SG&A for the nine months ended September 30, 2025 of $5.5 million increased by 9% compared to the nine months ended September 30, 2024 ($2.0 million for the third quarter of 2025, a 54% increase compared to the third quarter of 2024). The increase in SG&A for the three and nine months ended September 30, 2025 was primarily due to higher professional services, compensation and benefits and marketing costs, partially offset by lower occupancy related costs. The increase in SG&A for the nine months ended September 30, 2025, 2025 was also partially offset by lower bad debt expense. Professional services for the three and nine months increased primarily from a legacy litigation matter. Compensation and benefits for the three and nine months increased primarily from revenue growth in the Lenders One business. Marketing costs for the three and nine months increased primarily from revenue growth in the Lenders One business.
Income (loss) from operations
Income (loss) from operations was $0.1 million, representing less than 1% of service revenue, for the nine months ended September 30, 2025 compared to $0.1 million, representing less than 1% of service revenue, for the nine months ended September 30, 2024 (decreased to $(0.4) million, representing (4)% of service revenue for the third quarter of 2025, compared to $0.3 million, representing 4% of service revenue for the third quarter of 2024). Income from operations for the nine months ended September 30, 2025 was relatively flat compared to the nine months ended September 30, 2024. The decline in operating (loss) income as a percentage of service revenue for the three months ended September 30, 2025 was primarily from higher SG&A expenses and lower gross profit margins.
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Corporate and Others
Cost of Revenue
Cost of revenue consisted of the following:
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||||||||||||||||||||
| (in thousands) | 2025 | 2024 | % Increase (decrease) | 2025 | 2024 | % Increase (decrease) | ||||||||||||||||||||||||||||||||
| Technology and telecommunications | $ | 851 | $ | 901 | (6) | $ | 2,523 | $ | 2,551 | (1) | ||||||||||||||||||||||||||||
| Compensation and benefits | 729 | 697 | 5 | 2,130 | 2,106 | 1 | ||||||||||||||||||||||||||||||||
| Depreciation and amortization | 20 | 42 | (52) | 106 | 215 | (51) | ||||||||||||||||||||||||||||||||
| Cost of revenue | $ | 1,600 | $ | 1,640 | (2) | $ | 4,759 | $ | 4,872 | (2) | ||||||||||||||||||||||||||||
Cost of revenue for the nine months ended September 30, 2025 of $4.8 million decreased by 2% compared to the nine months ended September 30, 2024 ($1.6 million for the third quarter of 2025, a 2% decrease compared to the third quarter of 2024). The decrease in cost of revenue for the three and nine months ended September 30, 2025 was primarily driven by lower depreciation and amortization from the completion of the depreciation periods for certain premises and equipment.
Selling, General and Administrative Expenses
SG&A in Corporate and Others includes costs related to the corporate functions including executive, finance, technology, law, compliance, human resources, vendor management, facilities, risk management and eliminations between reportable segments.
SG&A expenses consisted of the following:
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||||||||||||||||||||
| (in thousands) | 2025 | 2024 | % Increase (decrease) | 2025 | 2024 | % Increase (decrease) | ||||||||||||||||||||||||||||||||
| Compensation and benefits | $ | 4,141 | $ | 3,500 | 18 | $ | 12,097 | $ | 11,863 | 2 | ||||||||||||||||||||||||||||
| Professional services | 761 | 1,396 | (45) | 2,886 | 4,076 | (29) | ||||||||||||||||||||||||||||||||
| Occupancy related costs | 721 | 611 | 18 | 2,070 | 2,031 | 2 | ||||||||||||||||||||||||||||||||
| Depreciation and amortization | 7 | 99 | (93) | 130 | 313 | (58) | ||||||||||||||||||||||||||||||||
| Marketing costs | — | — | — | — | 5 | (100) | ||||||||||||||||||||||||||||||||
| Other | 812 | 840 | (3) | 2,349 | 2,446 | (4) | ||||||||||||||||||||||||||||||||
| Selling, general and administrative expenses | $ | 6,442 | $ | 6,446 | — | $ | 19,532 | $ | 20,734 | (6) | ||||||||||||||||||||||||||||
SG&A for the nine months ended September 30, 2025 of $19.5 million decreased by 6% compared to the nine months ended September 30, 2024 ($6.4 million for the third quarter of 2025, a less than 1% decrease compared to the third quarter of 2024). The decrease in SG&A for the nine months ended September 30, 2025 was primarily driven by lower professional services from lower accruals for estimated legal matters. The decrease in professional services for the three months ended September 30, 2025 was primarily driven by lower accruals for estimated legal matters. The increase in compensation and benefits for the three months ended September 30, 2025 was primarily from higher share based compensation.
Other Income (Expense), net
Other income (expense), net principally includes interest expense and other non-operating gains and losses.
Other income (expense), net was $(13.0) million for the nine months ended September 30, 2025 compared to $(27.1) million for the nine months ended September 30, 2024 ($(2.2) million for the third quarter of 2025 and $(9.6) million for the third quarter of 2024). The change for the three and nine months ended September 30, 2025 was primarily driven by lower interest expense, partially offset by higher debt exchange transaction expenses. The lower interest expense was driven by the decrease in outstanding debt and a lower interest rate from the February 19, 2025 Debt Exchange Transaction.
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LIQUIDITY AND CAPITAL RESOURCES
Liquidity
Our primary source of liquidity has historically been cash flow from operations, cash proceeds from sales of businesses, cash proceeds from the sale of equity securities and cash on hand. However, primarily due to lower delinquency and foreclosure rates, and higher home equity, revenue has declined significantly compared to pre-pandemic levels (although revenue grew in 2024 compared to 2023 and for the first nine months of 2025 compared to the first nine months of 2024). The lower revenue, partially offset by efficiency initiatives and cost savings initiatives, has resulted in negative operating cash flow from operations. We believe lower interest expense as a result of the February 2025 Debt Exchange Transaction, more recent revenue growth from the renovation business launched in 2024, the anticipated improvement in the default market, on-boarding sales wins, and revenue mix together with our reduced cost structure, should help improve operating cash flow.
We seek to deploy cash generated in a disciplined manner. Principally, we intend to use cash to develop and grow complementary services and businesses that we believe will generate attractive margins in line with our core capabilities and strategy and fund negative operating cash flow, if necessary. We also use cash for repayments of our long-term debt and capital investments. In addition, from time to time we may consider and evaluate business acquisitions, dispositions, closures, sales of equity securities or other similar actions that are aligned with our strategy.
Revolving Loan Agreement
In connection with the Company’s Renovation business, on June 3, 2024 Altisource Solutions, Inc., an indirect subsidiary of Altisource Portfolio Solutions S.A, entered into a revolving loan agreement with a then related-party, Altisource Asset Management Corporation (“AAMC”) (the “Revolving Loan Agreement”).
Under the terms of the Revolving Loan Agreement, AAMC will make loans to Altisource from time to time, as may be requested by Altisource. The Revolving Loan Agreement provides Altisource the ability to borrow an initial aggregate amount of up to $1.0 million, with the potential for this to be increased up to $3.0 million at the option of AAMC. Amounts that are repaid may be re-borrowed in accordance with the limitations set forth below.
The maturity date of the Revolving Loan Agreement was June 3, 2025 and can be automatically extended for one year on each anniversary of the maturity date. During any extension period, AAMC may terminate the Revolving Loan Agreement upon 150 days prior written notice and the loan will mature upon such termination. During the second quarter of 2025 the Revolving Loan Agreement was renewed, extending the maturity date to June 3, 2026. The outstanding balance on the Revolving Loan Agreement is due and payable on such maturity date.
Borrowings under the Revolving Loan Agreement bear interest of 12.00% per annum in cash and are payable monthly in arrears on the first business day of each calendar month. Altisource will pay AAMC a monthly unused commitment fee in an amount equal to 0.25% per annum of the average amount of the unused available credit under the Revolving Loan Agreement.
Altisource’s obligation under the Revolving Loan Agreement is secured by certain receivables related to the Company’s residential real estate renovation services business.
As of September 30, 2025, there was $1.0 million outstanding debt under the Revolving Loan Agreement.
Cash Flows
The following table presents our cash flows for the nine months ended September 30:
| (in thousands) | 2025 | 2024 | % Increase (decrease) | |||||||||||||||||
| Net cash used in operating activities | $ | (4,560) | $ | (3,624) | (26) | |||||||||||||||
| Net cash used in investing activities | (299) | — | N/M | |||||||||||||||||
| Net cash provided by (used in) financing activities | 4,637 | (566) | N/M | |||||||||||||||||
| Net decrease in cash, cash equivalents and restricted cash | (222) | (4,190) | (95) | |||||||||||||||||
| Cash, cash equivalents and restricted cash at the beginning of the period | 32,700 | 35,416 | (8) | |||||||||||||||||
| Cash, cash equivalents and restricted cash at the end of the period | $ | 32,478 | $ | 31,226 | 4 | |||||||||||||||
_____________________________________
N/M — not meaningful.
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Cash Flows from Operating Activities
Cash flows from operating activities generally consist of the cash effects of transactions and events that enter into the determination of net (loss) income. For the nine months ended September 30, 2025, net cash used in operating activities was $(4.6) million compared to net cash used in operating activities of $(3.6) million for the nine months ended September 30, 2024. The increase in cash used in operating activities was driven by a $5.4 million higher use of cash for working capital (accounts receivable, prepaid expenses and other current assets, other assets, and accounts payable and accrued expenses), $12.7 million lower non-cash interest expense and $0.9 million lower non-cash share based compensation, partially offset by an $18.5 million improvement in income (loss) before income taxes and non-controlling interests. Operating cash flows can be negatively impacted because of the nature of some of our services and the mix of services provided. Certain services are performed immediately following or shortly after the referral, but the collection of the receivable does not occur until a specific event occurs (e.g., the foreclosure is complete, the REO asset is sold, etc.). Furthermore, lower margin services generate lower income and cash flows from operations. Consequently, our cash flows from operations may be negatively impacted when comparing one period to another.
Cash Flows from Financing Activities
Net cash provided by (used in) financing activities was $4.6 million and $(0.6) million for the nine months ended September 30, 2025 and 2024, respectively. During the nine months ended September 30, 2025, we received $11.3 million in proceeds from the Super Senior Credit Facility, net of the original issuance discount. We used $(1.7) million for debt issuance costs and $(3.8) million related to the issuance of equity, in connection to the Debt Exchange Transaction. During the nine months ended September 30, 2025, we used $0.6 million to make scheduled repayments of our senior secured term loan (no comparative amount for the nine months ended September 30, 2024). During the nine months ended September 30, 2024, we received proceeds from the issuance of short-term debt of $0.3 million in connection with borrowings under the Revolving Loan Agreement (no comparative amount for the nine months ended September 30, 2025). During the nine months ended September 30, 2025 and 2024, we made payments of $0.3 million and $0.7 million, respectively, to satisfy employee tax withholding obligations on the issuance of restricted share units (“RSUs”) and restricted shares. These payments were made to tax authorities, at the employees’ direction, to satisfy the employees’ tax obligations rather than issuing a portion of vested restricted share units and restricted shares to employees. In addition, during the nine months ended September 30, 2025 and 2024, we distributed $0.1 million and less than $0.1 million, respectively, to non-controlling interests.
Future Uses of Cash
Our significant future liquidity obligations primarily pertain to amortization of the New Facility, amortization and maturity of the Super Senior Facility, interest expense under the New Facility and the Super Senior Facility, and operating lease payments on certain of our premises and equipment.
Significant future uses of cash include the following:
| Payments Due by Period | ||||||||||||||||||||||||||
| (in thousands) | Total | 2025 | 2026-2027 | 2028-2029 | ||||||||||||||||||||||
New Facility (1) | $ | 6,018 | $ | 275 | $ | 2,200 | $ | 3,543 | ||||||||||||||||||
Super Senior Facility (2) | 12,437 | 31 | 250 | 12,156 | ||||||||||||||||||||||
Revolving Loan Agreement (3) | 1,000 | — | 1,000 | — | ||||||||||||||||||||||
Interest payments (4) | 53,894 | 3,337 | 26,077 | 24,480 | ||||||||||||||||||||||
| Lease payments | 1,462 | 392 | 914 | 156 | ||||||||||||||||||||||
| Total | $ | 74,811 | $ | 4,035 | $ | 30,441 | $ | 40,335 | ||||||||||||||||||
______________________________________
(1) $158.1 million of the New Facility matures on April 30, 2030 and $1.4 million of the New Facility matures on January 15, 2029.
(2) The Super Senior Facility matures on February 19, 2029.
(3) The outstanding balance of our Revolving Loan Agreement as of September 30, 2025 is $1.0 million and is currently due on June 3, 2026, and can be automatically extended for one year on each anniversary of the maturity date.
(4) Estimated future interest payments for the New Facility and the Super Senior Facility based on the three-month Secured Overnight Financing Rate (“SOFR”) interest rate as of September 30, 2025.
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We anticipate funding future liquidity requirements with a combination of existing cash balances and cash anticipated to be generated by operating activities. For further information, see Note 10 and Note 21 to the condensed consolidated financial statements.
Off-Balance Sheet Arrangements
Our off-balance sheet arrangements consist of escrow and certain other account arrangements.
We hold customers’ assets in escrow and other accounts at various financial institutions pending completion of certain real estate and construction review activities. These amounts are held in escrow and other accounts for limited periods of time and are not included in the accompanying condensed consolidated balance sheets. Amounts held in escrow and other accounts were $52.5 million and $27.1 million as of September 30, 2025 and December 31, 2024, respectively.
Contractual Obligations, Commitments and Contingencies
For the nine months ended September 30, 2025, there were no significant changes to our contractual obligations from those identified in our Form 10-K for the fiscal year ended December 31, 2024 and this Form 10-Q, other than those that occur in the normal course of business. See Note 21 to the condensed consolidated financial statements.
CRITICAL ACCOUNTING POLICIES, ESTIMATES AND RECENT ACCOUNTING PRONOUNCEMENTS
We prepare our interim condensed consolidated financial statements in accordance with GAAP. In applying many of these accounting principles, we need to make assumptions, estimates and judgments that affect the reported amounts of assets, liabilities, revenue and expenses in our condensed consolidated financial statements. We base our estimates and judgments on historical experience and other assumptions that we believe are reasonable under the circumstances. These assumptions, estimates and judgments, however, are often subjective. Actual results may be negatively affected based on changing circumstances. If actual amounts are ultimately different from our estimates, the revisions are included in our results of operations for the period in which the actual amounts become known.
Our critical accounting policies are described in the MD&A section of our Form 10-K for the year ended December 31, 2024 filed with the SEC on March 31, 2025. There have been no material changes to our critical accounting policies during the nine months ended September 30, 2025.
Recently Adopted and Future Adoption of New Accounting Pronouncements
See Note 1 to the condensed consolidated financial statements for a discussion of recently issued accounting pronouncements, including pronouncements that were adopted in the current period.
Item 3. Quantitative and Qualitative Disclosures about Market Risk
Market Risk
Our financial market risk consists primarily of interest rate and foreign currency exchange rate risk.
Interest Rate Risk
Under the terms of the New Facility, the interest rate charged on the New Debt is SOFR, with a floor of 3.50%, plus 6.50%. The interest rate charged on the Super Senior Facility is SOFR, with a floor of 3.50%, plus 6.50%. Based on the terms of the New Facility and the Super Senior Facility, a one percentage point increase in SOFR would increase our annual interest expense by approximately $1.2 million, and there would be a $1.2 million decrease in our annual interest expense if there was a one percentage point decrease in SOFR.
Currency Exchange Risk
We are exposed to currency risk from potential changes in currency values of our non-United States dollar denominated expenses, assets, liabilities and cash flows. Our most significant currency exposure relates to the Indian rupee. Based on expenses incurred in Indian rupees for the third quarter of 2025, a one percentage point increase or decrease in value of the Indian rupee in relation to the United States dollar would increase or decrease our annual expenses by approximately $0.3 million.
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Item 4. Controls and Procedures
a) Evaluation of Disclosure Controls and Procedures
Our disclosure controls and procedures are designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in reports we file or submit under the Exchange Act is accumulated and communicated to our management, including the Chairman and Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.
As of September 30, 2025, an evaluation was conducted under the supervision and with the participation of our management, including our Chairman and Chief Executive Officer and Chief Financial Officer, of the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) and Rule 15d-15(e) of the Exchange Act). Based on this evaluation, such officers have concluded that our disclosure controls and procedures were effective as of September 30, 2025.
b) Internal Control over Financial Reporting
There were no changes in our internal control over financial reporting (as defined in the Exchange Act Rules 13a-15(f) and 15d-15(f)) that occurred during the quarter ended September 30, 2025, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
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PART II — OTHER INFORMATION
Item 1. Legal Proceedings
We record a liability for contingencies if an unfavorable outcome is probable and the amount of loss can be reasonably estimated, including expected insurance coverage. For proceedings where the reasonable estimate of loss is a range, we record a best estimate of loss within the range.
Litigation
We are currently involved in legal actions in the course of our business, most of which seek monetary damages. Although the outcome of these proceedings cannot be predicted with certainty, we currently believe that their outcome, both individually and in the aggregate, will not have a material impact on our financial condition, results of operations or cash flows.
National Fair Housing Alliance v. Altisource Solutions, Inc., et al.
On or about February 1, 2018, the National Fair Housing Alliance (“NFHA”) and eighteen regional housing groups filed a civil complaint, subsequently amended, against Altisource Solutions, Inc., a wholly owned subsidiary of the Company, Deutsche Bank National Trust, as Trustee, Deutsche Bank Trust Company Americas, as Trustee, and Ocwen Loan Servicing, LLC, n/k/a Onity Group, Inc. in the United States District Court for the Northern District of Illinois. The complaint alleges violations of the federal Fair Housing Act in connection with the maintenance and marketing of certain real estate owned properties. Plaintiffs seek monetary damages, including attorneys’ fees. Trial is currently scheduled to begin in February 2026, although the schedule could change.
The Company believes it has meritorious defenses and intends to defend itself vigorously in this matter. While it is too early to predict the outcome of the proceedings or whether an adverse result would have a material impact on our operations or financial position, an adverse outcome could result in a material damages award. At this time, the Company cannot reasonably estimate the potential loss or range of loss, if any, associated with this matter.
Regulatory Matters
Periodically, we are subject to audits, examinations and investigations by governmental authorities and receive subpoenas, civil investigative demands or other requests for information from such governmental authorities in connection with their regulatory or investigative authority. We are currently responding to such inquiries from governmental authorities relating to certain aspects of our business. We believe it is premature to predict the potential outcome or to estimate any potential financial impact in connection with these inquiries.
Item 1A. Risk Factors
Except as set forth below, there have been no material changes to the risk factors previously disclosed in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2024, as supplemented by the risk factor disclosed in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2025. Capitalized terms used but not defined in this section have the meanings given to them in the 2024 Form 10-K. The risk factors in our Annual Report, as supplemented, continue to describe risks that could materially affect our business, financial condition, results of operations, and stock price. Additional risks and uncertainties not currently known to us or that we currently deem immaterial may also materially adversely affect us.
Certain of the risk factors in our Annual Report address risks associated with the potential non-renewal or termination of the Rithm Brokerage Agreement, or risks created by its obligations and limitations. The Rithm Brokerage Agreement expired on August 31, 2025 and was not renewed. While Altisource has continued to manage real estate owned (“REO”) and receive referrals with limited exceptions from portfolios previously subject to the Rithm Brokerage Agreement, Rithm is under no contractual obligation to continue to use Altisource to manage REO or provide referrals and such use and referrals may be reduced or terminated at any time. Accordingly, those risk factors should now be read to reflect that risks associated with the obligations or limitations of the Rithm Brokerage Agreement referenced in the risk factors no longer apply. In addition, we are amending and restating the following risk factor.
Expiration of the Rithm Brokerage Agreement may reduce related revenue
As previously disclosed, Rithm purchased brokerage services for REO exclusively from us, irrespective of the subservicer, subject to certain limitations, for certain MSRs set forth in and pursuant to the terms of the Rithm Brokerage Agreement through August 2025. The Rithm Brokerage Agreement expired on August 31, 2025. At Rithm’s discretion, Altisource has continued to manage REO and receive referrals with limited exceptions from portfolios previously subject to the Rithm Brokerage Agreement despite the expiration of the Rithm Brokerage Agreement. If Altisource does not continue to manage
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REO and receive referrals from portfolios previously subject to the Rithm Brokerage Agreement, or Rithm’s use of or referrals to Altisource are reduced, the level of Rithm brokerage and ancillary service revenue we generate going forward would decline. We are evaluating opportunities to replace or mitigate the potential impact of this lost revenue, but there can be no assurance that such efforts will be successful or sufficient.
Item 5. Other Information
Director and Officer Trading Arrangements
During the three months ended September 30, 2025, no director or officer of the Company adopted terminated
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Item 6. Exhibits
| Exhibit Number | Exhibit Description | |||||||
3.1 * | Amended and Restated Articles of Incorporation of Altisource Portfolio Solutions S.A. | |||||||
31.1 * | Section 302 Certification of the Chief Executive Officer pursuant to Exchange Act Rule 13a-14(a) | |||||||
31.2 * | Section 302 Certification of the Chief Financial Officer pursuant to Exchange Act Rule 13a-14(a) | |||||||
32.1 * | Certification by the Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | |||||||
101 * | Pursuant to Rule 405 of Regulation S-T, the following financial information from the Company’s Quarterly Report on Form 10-Q for the period ended September 30, 2025 is formatted in Inline XBRL interactive data files: (i) Condensed Consolidated Balance Sheets as of September 30, 2025 and December 31, 2024; (ii) Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income for the three and nine months ended September 30, 2025 and 2024; (iii) Condensed Consolidated Statements of Equity for the nine months ended September 30, 2025 and 2024; (iv) Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2025 and 2024; and (v) Notes to Condensed Consolidated Financial Statements. | |||||||
| 104 * | Cover Page Interactive Data File formatted as Inline XBRL and contained in Exhibit 101 | |||||||
| ______________________________________ | ||||||||
| * | Filed herewith. | |||||||
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| ALTISOURCE PORTFOLIO SOLUTIONS S.A. | ||||||||||||||
(Registrant) | ||||||||||||||
| Date: | October 23, 2025 | By: | /s/ Michelle D. Esterman | |||||||||||
| Michelle D. Esterman | ||||||||||||||
| Chief Financial Officer | ||||||||||||||
| (On behalf of the Registrant and as its Principal Financial Officer and Principal Accounting Officer) | ||||||||||||||
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FAQ
How did Altisource (ASPS) perform in Q3 2025?
Q3 revenue was $41.9 million and the net loss attributable to Altisource was $2.4 million, an improvement from a $9.4 million loss a year ago.
What are Altisource’s year-to-date results for 2025?
For the nine months ended September 30, 2025, revenue was $128.6 million and net income attributable to Altisource was $8.8 million.
What changed in Altisource’s capital structure in 2025?
The company exchanged $232.8 million of prior term loans for a $160.0 million new first lien facility and issued 7.3 million shares; it also added a $12.5 million super senior facility.
How much debt does Altisource report as of September 30, 2025?
Long‑term debt, net, was $191.3 million, with current maturities of $1.2 million.
What is Altisource’s cash position?
Cash and cash equivalents were $28.6 million as of September 30, 2025.
Did Altisource execute a reverse stock split?
Yes. A 1‑for‑8 share consolidation became effective on May 28, 2025.
How concentrated is Altisource’s customer base?
Onity accounted for 42% of consolidated revenue in Q3 2025.
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