Fathom Holdings’ mortgage business delivered a sharp improvement during the second quarter of 2026, with segment revenue increasing approximately 71% to $5.68 million from $3.32 million and Adjusted EBITDA swinging to positive $256,000 from a loss of $86,000 a year earlier. This performance counterbalanced weaker transaction activity in Fathom’s much larger residential brokerage operation.
Mortgage was one of Fathom’s strongest-performing operating businesses during a quarter in which consolidated revenue declined 6% to $114.6 million from $121.4 million. Gross commission income declined 8% to $107 million, while other service revenue increased 40% to $7.64 million. Fathom attributed the growth in other services to higher title-service transaction volume, organic expansion, increased walkover activity and continued growth in the mortgage business.
The improving mortgage results are also visible in Fathom’s lending activity. Mortgage loans held for sale originations reached approximately $177.5 million during the first six months of 2026, compared with approximately $120 million during the same period in 2025. Proceeds from sales and principal payments on mortgage loans held for sale totaled approximately $180 million compared with $115 million a year earlier.
Fathom conducts its mortgage operation through Encompass Lending, with loans temporarily financed through warehouse credit facilities before sale. As of June 30, the company reported $17.28 million of mortgage loans held for sale, up from $15.48 million at the end of 2025. Outstanding warehouse-line borrowings totaled $16.83 million.
The mortgage segment’s improvement contrasts with continuing pressure on Fathom’s core brokerage business. The company completed 10,808 real estate transactions during Q2, down 15% from 12,710 a year earlier, reflecting a lower agent count and continued softness in existing-home sales. Average revenue per transaction, however, increased 8.5% to $9,897 from $9,125, primarily due to higher transaction volumes through the Fathom Elevate concierge-level plan.
Within the segment structure, Real Estate Brokerage generated approximately $1.13 million of Adjusted EBITDA in Q2 compared with $2.10 million a year earlier. Mortgage improved to positive $256,000 from negative $86,000, while the Title segment’s loss narrowed to $46,000 from $272,000. The results show ancillary real estate services contributing more even as brokerage profitability declined.
Fathom’s consolidated profitability remained under pressure. The company recorded a second-quarter net loss of $6.2 million, up from $3.6 million a year earlier, while its first-half net loss widened to $14.4 million from $9.2 million. Operating cash use improved, however, to approximately $4.6 million during the first half from $11.7 million in the prior-year period.
Liquidity remains an important part of Fathom’s broader financial picture. Cash and equivalents totaled approximately $4.5 million at June 30, and the company has received financing support from Bed Bath & Beyond in connection with their pending combination. Fathom entered into a merger agreement with Bed Bath & Beyond in June, while a roughly $3 million bridge note from the company bears 9% annual interest and is scheduled to mature in April 2027 unless repaid earlier under its terms.
For the mortgage business specifically, the second-quarter results show that Fathom is generating faster growth from services surrounding the residential transaction even while overall brokerage volumes remain constrained. Continued expansion of mortgage and title activity could therefore become increasingly important to the company’s revenue mix and operating economics.
