Walker & Dunlop Reports 4% Revenue Growth but 77% Decline in Net Income for Q1 2025

Walker & Dunlop, Inc. reported its financial results for the first quarter of 2025, revealing total revenues of $237.4 million, a 4% increase from $228.1 million in the same period last year. The company's net income for the quarter was $2.8 million, a significant decline of 77% compared to $11.9 million in the first quarter of 2024. This drop in profitability was attributed to increased personnel expenses and a higher provision for credit losses, which rose to $3.7 million from a benefit of $0.5 million in the prior year. The basic earnings per share decreased to $0.08 from $0.35.

In terms of operational performance, Walker & Dunlop's loan origination and debt brokerage fees increased by 6% to $46.4 million, while servicing fees rose by 3% to $82.2 million. However, investment management fees saw a notable decline of 28%, falling to $9.7 million. The company also experienced a 53% increase in property sales broker fees, which reached $13.5 million, reflecting a strong performance in property sales volume. The total managed portfolio, which includes servicing and assets under management, grew by 3% to $154.2 billion, driven by an increase in the Fannie Mae servicing portfolio.

The company’s balance sheet as of March 31, 2025, showed total assets of $4.5 billion, up from $4.4 billion at the end of 2024. Total liabilities increased to $2.8 billion, primarily due to higher warehouse notes payable, which rose to $931 million from $782 million. Stockholders' equity decreased to $1.7 billion from $1.8 billion, reflecting the impact of the lower net income and stock repurchases. The company’s employee headcount also increased, contributing to higher personnel costs.

Strategically, Walker & Dunlop has focused on expanding its market presence and enhancing its service offerings. The company has been actively investing in technology to improve operational efficiencies and customer experience. In February 2025, the Board of Directors approved a stock repurchase program allowing for the repurchase of up to $75 million of common stock over a 12-month period. The company did not repurchase any shares during the first quarter but retains the full capacity under this program.

Looking ahead, Walker & Dunlop anticipates continued challenges in the commercial real estate market due to fluctuating interest rates and macroeconomic uncertainties. However, the company remains optimistic about its growth prospects, particularly in the multifamily sector, where it has seen increased transaction volumes. The management expects that stable interest rates and a strong pipeline of business will support its performance in the upcoming quarters.