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Rithm Capital Corp.: Q2 FY2026 earnings call

What management said about Q2 FY2026, from the documents filed with the SEC on 28 July 2026: press release. The quarter’s numbers.

Key takeaways

  • GAAP net income fell in the quarter: GAAP net income was $20.2 million, or $0.04 per diluted share, against $67.8 million, or $0.12, in the first quarter. Source
  • Earnings available for distribution rose: Earnings available for distribution were $338.9 million, or $0.60 per diluted share, against $289.6 million, or $0.51, in the first quarter. The company treats this as a non-GAAP measure. Source
  • Newrez operating income rose sharply: Newrez pre-tax operating income was $307.6 million before the MSR mark-to-market loss, net of hedges, and other non-operating items of $(194.5) million. The first quarter was $273.7 million and $(23.1) million. Source
  • Newrez return on equity reached 22%: Annualized operating ROE was 22% on $5.7 billion of average ending segment equity, against 19% in the first quarter. The company calls this a non-GAAP measure. Source
  • Genesis origination volume up 52%: Genesis Capital origination volume was $1.9 billion, up 52% year over year and up from $1.6 billion in the first quarter. Management said this continues a series of record volume quarters. Source
  • AUM rose to about $61 billion: Rithm Asset Management had approximately $61 billion of AUM at June 30, 2026, up from $59 billion, driven by $1.9 billion of gross inflows and new fund commitments. AUM has nearly doubled since 2023. Source
  • MSR fair value loss widened: The change in fair value of MSRs and MSR financing receivables, net of economic hedges, was a loss of $392.9 million, against $204.2 million in the first quarter. Cash flow realization was $213.9 million. Source

“reflects the significant momentum of our owner-operator platform, which continues to prove its depth and durability”

Michael Nierenberg, CEO of Rithm Capital

What changed from last quarter

  • New: A first securitization of home improvement loans, sized at $316 million, was completed in the second quarter. The first-quarter release did not mention one. Source

Results and growth drivers

  • GAAP net income fell in the quarter: GAAP net income was $20.2 million, or $0.04 per diluted share, against $67.8 million, or $0.12, in the first quarter. Source
  • Earnings available for distribution rose: Earnings available for distribution were $338.9 million, or $0.60 per diluted share, against $289.6 million, or $0.51, in the first quarter. The company treats this as a non-GAAP measure. Source
  • Revenue and pre-tax income declined: Total revenues were $1,282.3 million, against $1,384.7 million for the first quarter as recast. Income before income taxes was $86.9 million, against $154.2 million. Source
  • Book value per share declined: Book value per common share was $12.33 at June 30, 2026, against $12.51 at March 31, 2026. Source

Origination and servicing (Newrez)

  • Newrez operating income rose sharply: Newrez pre-tax operating income was $307.6 million before the MSR mark-to-market loss, net of hedges, and other non-operating items of $(194.5) million. The first quarter was $273.7 million and $(23.1) million. Source
  • Newrez return on equity reached 22%: Annualized operating ROE was 22% on $5.7 billion of average ending segment equity, against 19% in the first quarter. The company calls this a non-GAAP measure. Source
  • Origination volume edged up: Origination funded production volume was $15.9 billion, up 3% quarter over quarter and down 2% year over year. The first quarter was $15.5 billion. Source
  • Servicing book grew: Total servicing UPB reached $865.2 billion, including $268.4 billion of third-party servicing. The first quarter was $850 billion, including $257 billion of third-party. Source

“As our clients deepen their engagement with Rithm, we are confident in our positioning”

Michael Nierenberg, CEO of Rithm Capital

Residential transitional lending (Genesis)

  • Genesis origination volume up 52%: Genesis Capital origination volume was $1.9 billion, up 52% year over year and up from $1.6 billion in the first quarter. Management said this continues a series of record volume quarters. Source
  • New sponsors funded rose 46%: Genesis funded 125 new sponsors in the quarter, up 46% year over year, against 118 in the first quarter. Source
  • First-quarter sponsor total reported earlier: The Q2 release does not give total sponsors funded for the quarter. The first-quarter release reported 266, up 40% year over year.

Asset management

  • AUM rose to about $61 billion: Rithm Asset Management had approximately $61 billion of AUM at June 30, 2026, up from $59 billion, driven by $1.9 billion of gross inflows and new fund commitments. AUM has nearly doubled since 2023. Source
  • Asset management revenue rose 34%: Asset management revenue was $141 million, up from about $105 million in the first quarter, a 34% increase the company attributes to higher incentive fee income. The income statement line shows $142.2 million. Source
  • Incentive fees rose sharply: Incentive fees were $51.7 million against $15.7 million in the first quarter. Management fees were $88.8 million against $89.2 million. Source

Commercial real estate (Elecor)

  • Year-to-date leasing reached 681 thousand square feet: Elecor year-to-date leasing activity reached 681 thousand square feet. Source
  • 1325 Avenue refinancing closed: Management said it closed the previously announced $283 million refinancing of 1325 Avenue of the Americas, financed through a broadly syndicated single-asset single-borrower CMBS. Source
  • Commercial real estate revenue edged up: Commercial real estate revenue was $182.1 million, against $178.3 million in the first quarter as recast. Source

Investment portfolio and securitizations

  • Non-QM securitizations totaled $1.4 billion: Rithm sponsored and completed three non-qualified mortgage securitizations in Q2 totaling $1.4 billion UPB. The first quarter had four, totaling $2.0 billion. Source
  • Upgrade home improvement purchases continued: Acquired $303 million of home improvement loans under the existing forward flow agreement with Upgrade, bringing the total purchased through quarter-end to $970 million, against $667 million at March 31. Source
  • Investment Portfolio interest income rose: Investment Portfolio segment interest income was $85.4 million, against $96.0 million in the first quarter. Source

Costs, margins and segment results

  • Segment pre-tax results by business: Pre-tax income: Origination & Servicing $113.1 million, Residential Transitional Lending $37.0 million, Asset Management $14.0 million, Investment Portfolio $31.5 million. Commercial Real Estate lost $34.8 million; Corporate $73.9 million. Source
  • Compensation costs rose: Compensation and benefits rose to $410.5 million from $378.4 million in the first quarter. Source
  • First-quarter comparatives were recast: Interest expense and warehouse line fees for the first quarter now read $450.1 million, against $430.7 million as first reported. General, administrative and operating now reads $316.6 million, against $336.0 million. Source
  • MSR fair value loss widened: The change in fair value of MSRs and MSR financing receivables, net of economic hedges, was a loss of $392.9 million, against $204.2 million in the first quarter. Cash flow realization was $213.9 million. Source

Capital, balance sheet and dividend

  • Common dividend held at $0.25: Common dividend was $0.25 per share, totaling $139.6 million, unchanged from the first quarter. Preferred stock dividends were $36.1 million, against $34.8 million. Source
  • Unsecured notes rose: Unsecured notes, net of issuance costs, were $1.90 billion at June 30, against $1.42 billion at March 31. Total assets were $54.1 billion and total stockholders’ equity $9.05 billion. Source
  • Diluted share count increased: Weighted average diluted shares were 568.3 million, against 565.9 million in the first quarter. Source

Figures management reported

FigureReported
Leasing spreads SourceYear-to-date rents 32% higher than FY 2025 in New York City; 1% higher in San Francisco

Risks management discussed

  • External: Management referred to an uncertain macro environment as the backdrop for the quarter. Source

Earlier plans management reported on

  • Not stated: Management said the refinancing closed in the second quarter. Source

Other quarters

Summarised with AI from the documents the company filed with the SEC. Every point is checked against the filing before it is shown: management’s own words word for word, figures against the line or table row they come from. A point that fails the check is left out. Source opens the filing at that line.