BETHESDA, Md.--(BUSINESS WIRE)--Walker & Dunlop, Inc. (NYSE: WD) (the “Company,” “Walker & Dunlop” or “W&D”) reported third quarter 2026 financial results.

• Net loss of $37.3 million and diluted loss per share of $1.15 primarily reflect charges associated with the accelerated resolution of legacy loan repurchases and indemnifications. These charges reflect deliberate actions to accelerate the disposition of repurchased and indemnified assets related to the GSE investigations, which are now completed and are described in more detail below

• Total revenues of $298.4 million declined 12% from Q3’25, in line with the decrease in transaction volumes, and primarily reflecting a greater mix of brokered transactions relative to GSE lending. W&D’s year-to-date GSE market share increased 290 basis points, to 13.7%, from the prior-year period

• Adjusted core EPS⁽¹⁾ was $0.92 and declined 25% compared to the prior year period due primarily to lower revenue and increased costs within the repurchased portfolio; these costs are expected to be eliminated by early 2027

• The servicing portfolio increased to $146.6 billion as of September 30, 2026, up 5% from the prior-year period, reinforcing the stability of W&D’s recurring revenue base, cash flow and the strength of its platform

“Q3 2026 saw an 84 basis point increase in the Ten-Year Treasury rate which increased volatility and slowed down capital markets activity across the country. Despite these headwinds, our revenues remained resilient, with total debt financing volume down only 5% from Q3 2025," said Willy Walker, Chairman and CEO. "During the quarter we received notice from Fannie Mae that they have completed their fraud review of Walker & Dunlop, similar to Freddie Mac in Q2 2026, and we do not expect any further buybacks or indemnifications related to these investigations going forward. Importantly, we are taking action to address the legacy credit issues associated with these matters and put them firmly behind us. We reclassified all of the repurchased assets and non-performing notes to "held for sale," recognized a significant charge to Q3 earnings, and intend to dispose of these assets by early 2027. While these actions have a meaningful near-term impact on earnings, they reflect our commitment to proactively resolving credit issues, reducing risk on our balance sheet, and strengthening our financial position for the future. We believe that the completion of the GSE investigations and the sale of the repurchased loans, allows Walker & Dunlop to move beyond the borrower fraud issues that have consumed us, and our financial performance, for the past two years.”

Walker continued, “We believe there is a tremendous opportunity ahead as commercial real estate owners navigate the upcoming wave of debt maturities and evaluate whether to refinance, sell, or recapitalize their properties. We have refined our strategy to focus on the multifamily market where W&D has a massive brand and there is nearly $1 trillion of maturing loans over the next four years. We are leveraging technology to improve productivity, strengthen client relationships, and reduce our fixed cost structure, and underwent a reduction in force and reorganization in Q3. While higher interest rates and lower asset values present significant challenges for property owners, as a scaled service provider with an enormous tangible addressable market in our company's core competency, we now have the ability to execute, grow, and get back to the outstanding shareholder returns Walker & Dunlop has been known for.”

• Total debt financing volume declined 5%, as 58% growth in brokered debt volume was offset by declines in Agency lending volumes
• W&D continues to grow our presence in the non-Agency multifamily market while simultaneously gaining 290 basis points of market share with the GSEs on a year-to-date basis
• Property sales activity increased sequentially this quarter as activity increased despite market volatility, and while operating fundamentals are modestly improving, continued interest rate volatility delayed some investment decisions during the quarter

• Revenues declined 18% compared to total transaction volume declines of 11% primarily due to a higher proportion of lower fee brokered transactions relative to GSE lending, resulting in lower origination fees and MSR income. While the GSE’s lending volumes declined 30% market wide this quarter, our platform diversification and expansion in the non-Agency multifamily market has strengthened our ability to serve clients across multiple financing channels, enabling us to capture more business opportunities, and enhance our competitiveness in a challenging market environment.
• Net warehouse interest income improved to net income in the current quarter, reflecting the normalization of the yield curve
• Other revenues for the segment improved, driven by growth in investment banking fees, appraisal and valuation services, and application fees

   

• Continued origination activity over the past year expanded the servicing portfolio to $146.6 billion, further strengthening the recurring revenue and cash flow that supports our long-term earnings growth. The portfolio also creates future opportunities to refinance, recapitalize and deepen client relationships as loans mature over time.
• Agency production over the past 12 months was the main driver for the addition of more than $7 billion of net loans to the servicing portfolio. Approximately $16.9 billion of Agency loans are scheduled to mature over the next two years, providing a meaningful pipeline of client engagement opportunities to support future transaction activity.
• The decline in brokered servicing was primarily driven by a large partner consolidating its servicing relationships for one of its funds during the second quarter of 2026. We continue to have a strong servicing relationship with that lender, and we retain exclusive servicing rights for a different fund. Growing our servicing portfolio remains a key component of our strategy.
• Mortgage servicing rights (“MSRs”) continued to deliver significant long-term value. As of September 30, 2026, MSRs associated with our servicing portfolio are reported at an amortized cost of $775.5 million, while the fair value is estimated at $1.4 billion, reflecting the inherent value of the long-term contractual nature of these assets and the recurring servicing and ancillary revenues they generate.
• Assets under management totaled $19.2 billion as of September 30, 2026, and consisted of $16.4 billion of low-income housing tax credit (“LIHTC”) funds managed by our affordable housing investment management team, $1.9 billion of debt funds, and $0.8 billion of equity funds managed by our registered investment adviser, WDIP

   

• Segment results include $63 million of repurchase related charges, comprised of $56 million of non-cash valuation adjustments related to our decision to accelerate resolution of legacy loan repurchases and $7 million of operating expenses associated with the aggregate portfolio. We are taking deliberate action to more quickly dispose of these assets and eliminate ongoing carrying costs for this portfolio, mitigate future uncertainty around the path and timing of disposition, and increase the consistency and predictability of our financial performance.
• The Servicing & Asset Management segment continues to benefit from the stable recurring servicing fees from the servicing portfolio
• Servicing fees increased 3% year-over-year, however, total revenue declined 2% due primarily to lower placement fee earnings from escrow accounts as a result of a decrease in the Effective Federal Funds Rate this quarter compared to the year ago quarter
• The underlying fundamentals of the segment remain strong, and continued execution from our Capital Markets business in the coming quarters should drive additional servicing portfolio expansion

• The at-risk servicing portfolio continues to demonstrate strong underlying credit performance with low default levels. Growth in the at-risk portfolio reflects continued Fannie Mae loan production over the past year, while our credit exposure remains concentrated in loans backed by multifamily assets.
• Based on the latest property level financial information available, our at-risk portfolio operated at a weighted average debt service coverage ratio of 2x and the weighted average underwritten loan-to-value is approximately 61%. Less than 1% of our loans were below a 1.0 times debt service coverage ratio, and were underwritten above a 75% loan-to-value, reflecting the discipline of our underwriting process.

   

• The Corporate segment is structured to support continued scaling of our business. Revenues for the segment are down primarily due to lower earnings on co-invested capital in funds we manage. Unchanged corporate expenses this quarter reflect our disciplined cost management as the segment continues to support growth of our Capital Markets and Servicing & Asset Management businesses.

• During the third quarter, we exited $39.4 million of repurchased loans at prices that approximated our carrying values at the end of the second quarter 2026. These sales reduced total repurchased loans to $164.8 million as of September 30, 2026, down from $221.6 million as of December 31, 2025.
• During the third quarter, we recognized $56 million of valuation adjustments for the remaining repurchased loan portfolio in connection with our decision to accelerate the disposition of the remaining assets. The carrying value of the repurchased portfolio is $76.9 million at September 30, 2026. We also incurred $7 million of ongoing operating expenses this quarter to operate the underlying assets.
• The majority of these loans are concentrated in a small number of sponsors involved in the previously identified instances of borrower fraud. We have launched the marketing process for all non-performing repurchased loans and assets, and as of today approximately $25 million of the portfolio has already been placed under a letter of intent. We expect to fully exit the remaining assets in this portfolio by early next year, and any future fair value adjustments will be driven by the difference between the ultimate selling prices relative to our current estimates.

CAPITAL SOURCES AND USES

On November 4, 2026, the Company’s Board of Directors declared a dividend of $0.68 per share for the fourth quarter of 2026. The dividend will be paid on December 4, 2026, to all holders of record of the Company’s restricted and unrestricted common stock as of November 20, 2026.

On February 13, 2026, our Board of Directors authorized the repurchase of up to $75.0 million of the Company’s outstanding common stock over a 12-month period starting from February 26, 2026 (the “2026 Stock Repurchase Program”). During the first quarter of 2026, the Company repurchased 283 thousand shares under the 2026 Stock Repurchase Program at a weighted-average price of $47.13 per share and immediately retired the shares, reducing stockholders’ equity by $13.3 million. The Company did not repurchase any shares during the second or third quarters of 2026. As of September 30, 2026, the Company had $61.7 million of authorized share repurchase capacity remaining under the 2026 Stock Repurchase Program.

Any repurchases made pursuant to the 2026 Stock Repurchase Program will be made in the open market or in privately negotiated transactions, from time to time, as permitted by federal securities laws and other legal requirements. The timing, manner, price and amount of any repurchases will be determined by the Company in its discretion and will be subject to economic and market conditions, stock price, applicable legal requirements and other factors. The repurchase program may be suspended or discontinued at any time.

CONFERENCE CALL INFORMATION

Listeners can access the Company’s quarterly conference call for more information regarding our financial results via the dial-in number and webcast link below. Presentation materials related to the conference call will be posted to the Investor Relations section of the Company’s website prior to the call. An audio replay will also be available on the Investor Relations section of the Company’s website, along with the presentation materials.

ABOUT WALKER & DUNLOP

Walker & Dunlop (NYSE: WD) is one of the largest commercial real estate finance and advisory services firms in the United States and internationally. Our ideas and capital create communities where people live, work, shop, and play. Our innovative people, breadth of our brand, and our technological capabilities make us one of the most insightful and client-focused firms in the commercial real estate industry.

NON-GAAP FINANCIAL MEASURES

To supplement our financial statements presented in accordance with United States generally accepted accounting principles (“GAAP”), the Company uses adjusted EBITDA, adjusted core net income, and adjusted core EPS, which are non-GAAP financial measures. The presentation of these non-GAAP financial measures is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. When analyzing our operating performance, readers should use adjusted EBITDA, adjusted core net income, and adjusted core EPS in addition to, and not as an alternative for, net income and diluted EPS.

Adjusted core net income and adjusted core EPS represent net income adjusted for amortization and depreciation, provision (benefit) for credit losses, net write-offs based on the final resolution of the defaulted loans or collateral, the fair value of expected net cash flows from servicing, net of guaranty obligation, the income statement impact from periodic revaluation and accretion associated with contingent consideration liabilities related to acquired companies, goodwill impairment, loan repurchase losses and other adjustments. Adjusted EBITDA represents net income before income taxes, interest expense on our corporate debt, and amortization and depreciation, adjusted for provision (benefit) for credit losses, net write-offs based on the final resolution of the defaulted loans or collateral, loan repurchase losses, stock-based compensation, the fair value of expected net cash flows from servicing, net of guaranty obligation, the write-off of the unamortized balance of deferred issuance costs associated with the repayment of a portion of our corporate debt, goodwill impairment, and contingent consideration liability fair value adjustments when the fair value adjustment is a triggering event for a goodwill impairment assessment. Furthermore, adjusted EBITDA is not intended to be a measure of free cash flow for our management’s discretionary use, as it does not reflect certain cash requirements such as tax and debt service payments. The amounts shown for adjusted EBITDA may also differ from the amounts calculated under similarly titled definitions in our debt instruments, which are further adjusted to reflect certain other cash and non-cash charges that are used to determine compliance with financial covenants. Because not all companies use identical calculations, our presentation of adjusted EBITDA, adjusted core net income and adjusted core EPS may not be comparable to similarly titled measures of other companies.

We use adjusted EBITDA, adjusted core net income, and adjusted core EPS to evaluate the operating performance of our business, for comparison with forecasts and strategic plans and for benchmarking performance externally against competitors. We believe that these non-GAAP measures, when read in conjunction with the Company’s GAAP financial information, provide useful information to investors by offering:

• the ability to make more meaningful period-to-period comparisons of the Company’s on-going operating results;
• the ability to better identify trends in the Company’s underlying business and perform related trend analyses; and
• a better understanding of how management plans and measures the Company’s underlying business.

We believe that these non-GAAP financial measures have limitations in that they do not reflect all of the amounts associated with the Company’s results of operations as determined in accordance with GAAP and that these non-GAAP financial measures should only be used to evaluate the Company’s results of operations in conjunction with the Company’s GAAP financial information. For more information on adjusted EBITDA, adjusted core net income, and adjusted core EPS, refer to the section of this press release below titled “Adjusted Financial Measure Reconciliation to GAAP” and “Adjusted Core EPS Reconciliation.”

FORWARD-LOOKING STATEMENTS

Some of the statements contained in this press release may constitute forward-looking statements within the meaning of the federal securities laws. Forward-looking statements relate to expectations, projections, plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. In some cases, you can identify forward-looking statements by the use of forward-looking terminology such as “may,” “will,” “should,” “expects,” “intends,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” or “potential” or the negative of these words and phrases or similar words or phrases that are predictions of or indicate future events or trends and which do not relate solely to historical matters. You can also identify forward-looking statements by discussions of strategy, plans, or intentions. The forward-looking statements contained in this press release reflect our current views about future events and are subject to numerous known and unknown risks, uncertainties, assumptions and changes in circumstances that may cause actual results to differ significantly from those expressed or contemplated in any forward-looking statement.

While forward-looking statements reflect our good faith projections, assumptions and expectations, they are not guarantees of future results. Furthermore, we disclaim any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, new information, data or methods, future events or other changes, except as required by applicable law. Factors that could cause our results to differ materially include, but are not limited to: (1) general economic conditions and multifamily and commercial real estate market conditions, (2) changes in interest rates, (3) regulatory and/or legislative changes to Freddie Mac, Fannie Mae or HUD, (4) our ability to retain and attract loan originators and other professionals, (5) success of our various investments funded with corporate capital, (6) changes in federal government fiscal and monetary policies, including any constraints or cuts in federal funds allocated to HUD for loan originations, and (7) our obligations to repurchase or indemnify the GSEs for loans we originate under their programs and any potential losses we may incur as a result, including in connection with our decision to accelerate our disposition and liquidation strategy for previously repurchased and indemnified loans and associated collateral.

For a further discussion of these and other factors that could cause future results to differ materially from those expressed or contemplated in any forward-looking statements, see the section titled “Risk Factors” in our most recent Annual Report on Form 10-K and any updates or supplements in subsequent Quarterly Reports on Form 10-Q and our other filings with the SEC. Such filings are available publicly on our Investor Relations web page at www.walkerdunlop.com.