Rithm Capital (RITM) Q1 2025 earnings summary

Executive summary

• Reported strong Q1 2025 results with 8% year-over-year growth in earnings available for distribution (EAD) per share, robust segment performance, and disciplined capital management, despite market volatility and MSR fair value losses.

• Total assets at March 31, 2025 were $45.3 billion, with $34.8–$35 billion in assets under management, spanning origination, servicing, investment portfolio, residential transitional lending, and asset management.

• Equity remains undervalued relative to book value and peers, with current market valuation at 0.83x book value and management actively exploring capital actions to unlock value.

• Completed major acquisitions, including Sculptor and Computershare Mortgage Services, and expanded into new verticals such as energy and infrastructure.

• Sponsored a $230 million SPAC IPO to pursue off-balance sheet opportunities and enhance asset management capabilities.

Financial highlights

• Q1 2025 EAD was $0.52 per diluted share (up 8% YoY), with GAAP net income of $36.5 million ($0.07 per share); book value per share ended at $12.39.

• Common stock dividend was $0.25 per share (8.7% yield), with $132.5 million declared for Q1 2025.

• Cash and liquidity stood at $1.5–$1.9 billion at quarter-end.

• Return on equity was 17% for EAD and 2% for GAAP net income.

• Total assets were $45.3 billion at March 31, 2025.

Outlook and guidance

• Targeting annualized business returns between 15% and 20%, with plans to grow off-balance sheet capital, expand investment verticals, and increase asset management fee-related earnings.

• Management expects to take capital actions by end of 2025 to unlock shareholder value, including potential public listing or structural changes.

• Sufficient liquidity is expected for the next 12 months, with $1.3 billion available at regulated subsidiaries and $11.6 billion in available financing capacity.