Doma Holdings Inc.

Doma reported Q4 2023 GAAP revenue of $85 million, up 11% sequentially from $76 million in Q3 2023. Retained premiums and fees were $17 million, up 7% sequentially, and adjusted gross profit was $8 million versus $6 million in Q3, with adjusted gross profit margin at 47% versus 39% in Q3. Adjusted EBITDA for continuing operations was a loss of $3 million, improving from a loss of $5 million in Q3 and a loss of $11 million in Q4 2022. Management did not give formal next-quarter or full-year financial guidance, but said Q1 is typically a seasonal low point and that continued macro uncertainty could make adjusted EBITDA profitability in the first half of the year difficult; they also said Upfront Title revenue is not expected to be material in the first half of 2024.

Max Simkoff framed 2023 as a transformational year, highlighting major cost reductions, the exit from non-core local agency operations, and a narrowed strategy focused on affordable, tech-driven title solutions. He emphasized that Upfront Title could shift more revenue toward higher-margin software licensing and said the pilot launched ahead of schedule with encouraging early results. His tone was confident and advocacy-driven, repeatedly tying Doma’s strategy to housing affordability and saying the company is well positioned to benefit from public and political support for lower-cost title solutions.

Mike Smith focused on the improved financial profile after exiting local retail operations nationwide in 2023, noting substantial savings and lower legacy costs. He said Q4 adjusted gross profit was $8 million, adjusted gross profit margin was 47%, and adjusted EBITDA loss improved to $3 million, driven by higher RP&F, lower claims, workforce reductions, and lower overall spend. He also highlighted that GAAP revenue rose to $85 million and RP&F reached $17 million, with homebuilder strength a key driver, while cautioning that mortgage rates above 6% are likely to keep pressure on industry volumes through 2024.

Analysts pressed on how Upfront Title would be monetized, and management said the company is open to either per-transaction or subscription-style licensing, but wants a structure that aligns with lender, GSE, and consumer benefits. Questions also focused on the FHFA/Fannie Mae pilot and what qualifies as a low-risk refinance; management said it could not define FHFA’s term but believes most conforming refinances can be instantly underwritten by Doma’s technology. On market timing, management said administrative action could arrive relatively soon, and on consumer interest they said lenders and the mortgage tech platform partner have been very receptive because the product can save borrowers hundreds to thousands of dollars without introducing meaningful new risk.