Altisource Portfolio Solutions reported revenue of $49.8 million in the third quarter of 2026, up 26% from $39.5 million a year earlier, as new customer wins in its marketplace and origination businesses ramped up faster than expected. Adjusted EBITDA rose 17% to $4.3 million, while the company swung to a small net profit of $0.6 million from a $1.2 million loss last year. The results beat the $46.9 million consensus, and shares rose 6% in after hours trading.
Chief executive William Shepro said growth was led by the marketplace segment, where revenue climbed 34% to $28.4 million on higher volumes from foreclosure auctions and property sales. Origination revenue grew 18% to $16.1 million, helped by two large lender contracts signed in the spring that began contributing in July. The smaller technology unit was flat at $5.3 million, as Altisource shifted resources toward its higher margin services.
Investors have watched Altisource for signs that its turnaround, begun after a sharp fall in mortgage volumes in 2023, is gaining traction. The company cut costs by $12 million over the past year, closed two offices and moved more work to offshore teams, while adding sales staff in the United States. Shepro said the third quarter showed the model working, with revenue growth outpacing expense growth for the second straight quarter.
Altisource revenue growth by segment
Within marketplace, auction volumes rose 22% and average revenue per transaction increased 9%, reflecting a mix shift toward higher value properties in Florida and Texas. Altisource said it onboarded 14 new clients in the quarter, including three regional banks that had previously handled sales in house. In origination, the new lender contracts added $3.8 million in revenue, and management said the pipeline for the fourth quarter was the strongest since 2022.
Costs remained a focus. Operating expenses rose 8% to $31.2 million, slower than revenue, as savings from the office closures offset higher technology spending. Altisource also reduced debt by $6 million in the quarter, leaving $42 million outstanding, and said it had no maturities until 2028. Free cash flow was $2.1 million, compared with a $0.8 million outflow a year earlier.
What Altisource revenue means for the outlook
For the full year, Altisource raised its revenue guidance to $188 million to $194 million, up from $178 million to $186 million, and guided to adjusted EBITDA of $15 million to $17 million. The company cautioned that housing volumes remain sensitive to interest rates, and that a sharp rise in mortgage rates could slow auction activity in early 2027. Still, Shepro said the fourth quarter had started well, with October volumes ahead of last year.
Analysts were split on valuation after the beat, with one firm raising its target to $18 from $15 and another holding at $14, citing thin margins in origination. Altisource shares have risen 31% this year, outpacing the wider financial services index, but remain well below their 2021 peak. The company is due to report fourth quarter results in February, when investors will look for evidence that the new client wins can sustain growth into 2027.