Finance of America Companies Q2 2026 Earnings Results & Report

Finance of America Companies EPS Results

• Actual EPS: $0.84
• Consensus EPS: $1.04
• Beat/Miss: Missed by -$0.20
• One Year Ago EPS: N/A
• EPS Beat Rate: 5 of last 8 quarters

Finance of America Companies Revenue Results

• Actual Revenue: $62.48 million
• Expected Revenue: $121.94 million
• Beat/Miss: Missed by -$59.46 million
• YoY Revenue Growth: N/A

Finance of America Companies (NYSE:FOA), Inc. (NYSE: FOA) is a financial services company focused on helping older homeowners use their home equity as part of a broader retirement strategy. Through its subsidiaries, the company provides reverse mortgage products and related solutions designed to help homeowners access cash, supplement retirement income, manage expenses or remain in their homes.

The company’s reverse mortgage business, Finance of America Reverse, offers federally insured Home Equity Conversion Mortgages as well as proprietary reverse mortgage products, including HomeSafe. These products are generally marketed to homeowners age 62 and older, subject to applicable program requirements. Finance of America also provides educational resources and support for consumers, lending professionals and other advisers involved in retirement and home-equity planning.

Finance of America serves customers throughout the United States through a network of direct-to-consumer and professional channels. The company has evolved from a broader mortgage platform into a more specialized provider of home-equity-based retirement solutions and is led by Chief Executive Officer Graham Fleming.

Finance of America Companies Q2 2026 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: Adjusted earnings and production improved significantly: Second-quarter adjusted net income was $19 million, or $0.84 per share, while first-half adjusted EPS rose 81% year over year to $1.94. First-half originations increased 14%, with second-quarter reverse mortgage fundings up 21% year over year to $730 million.
• Positive Sentiment: Demand and operating efficiency strengthened, with submissions exceeding $1 billion, retail funded loans up 33% year over year, and funded loans per call-center officer increasing nearly 30% sequentially. Management attributed the gains partly to its proprietary technology and AI-enabled platforms.
• Positive Sentiment: Finance of America generated $58 million of cash from originations and capital-markets activity during the quarter and completed the acquisition of a $5.2 billion HECM mortgage-servicing-rights portfolio from Onity. The asset is expected to generate a mid-teens yield in the second half and is already included in company guidance.
• Positive Sentiment: Management reaffirmed full-year guidance for funded volume of $2.8 billion to $3.1 billion and adjusted EPS of $4.50 to $5.00. The company’s primary capital-allocation priority is retiring the remaining $150 million of senior secured notes in November, which should reduce financing costs and could later enable buybacks, dividends, or additional investment.
• Negative Sentiment: GAAP results were pressured by $84 million of negative fair-value adjustments, including a $24 million mark on convertible notes tied to the stock-price increase, resulting in a $29 million quarterly net loss. Interest-rate volatility also affected gain-on-sale margins and the valuation of portfolio assets, creating potential ongoing earnings and book-value volatility.

Presentation

[Operator]

Ladies and gentlemen, thank you for standing by. My name is Leah, and I will be your conference moderator today. At this time, I'd like to welcome you to the Finance of America second quarter 2026 earnings call. After today's prepared remarks, we will host a question-and-answer session. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. I will now turn the call over to Michael Fant, Senior Vice President of Finance. You may now begin.

[Michael Fant, SVP of Finance at Finance of America]

Thank you, good afternoon, everyone, and welcome to Finance of America's second quarter 2026 earnings call. With me today are Graham Fleming, Chief Executive Officer, Kristen Sieffert, President, and Matt Engel, Chief Financial Officer. As a reminder, this call is being recorded, and you can find the earnings release and related presentation on our investor relations website at ir.financeofamericacompanies.com. I would like to remind everyone that comments on this conference call may be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 regarding the company's expected operating and financial performance for future periods. These statements are based on the company's current expectations and are subject to the safe harbor statement for forward-looking statements that you will find in today's earnings release and related presentation.

[Michael Fant, SVP of Finance at Finance of America]

Actual results for future periods may differ materially from those expressed or implied by these forward-looking statements due to a number of risks or other factors, including those that are described in the Risk Factors section of Finance of America's annual report on Form 10-K for the year ended December 31st, 2025, filed with the SEC on March 13th, 2026. Such risk factors may be amended and updated in our subsequent filings with the SEC. We are not undertaking any commitment to update these statements if conditions change. Today we will be discussing interim period financials for our continuing operations, which are unaudited. We will refer to certain non-GAAP financial measures on this call. You can find reconciliations of non-GAAP to GAAP financial measures to the extent available without unreasonable efforts in our earnings press release and presentation on the investor relations page of our website.

[Michael Fant, SVP of Finance at Finance of America]

I will turn the call over to our Chief Executive Officer, Graham Fleming. Graham?

[Graham Fleming, CEO at Finance of America]

Thank you, Michael. Good afternoon, everyone, and thank you for joining us. The second quarter reinforced what we've been communicating over the past several quarters, that the operational improvements and investments we have made are now translating into a stronger, more scalable business. While market movements can create volatility in fair value adjustments and gain on sale margins, we remain focused on areas we directly control. Production, operating efficiency, expense management, capital allocation, and cash generation. During the second quarter, our team delivered strong execution across each of those areas. To start, if you turn to slide five of the accompanying presentation, Finance of America recognized adjusted net income of $19 million or $0.84 per share during the second quarter. For the first half of 2026, we have generated $45 million in adjusted net income or $1.94 per share, an 81% improvement over the first half of 2025.

[Graham Fleming, CEO at Finance of America]

This stems from the 14% increase in originations so far in 2026 compared to the first half of 2025, including $730 million in reverse mortgages funded in the second quarter. This represents a 21% increase over the second quarter of last year and leaves us confident in our ability to achieve our full year guidance range. Perhaps the clearest demonstration of our execution this quarter was the strength of our cash generation, allowing us to invest in strategic growth and strengthen the balance sheet. During the quarter, we generated $58 million in cash through our originations and capital markets activities. We used those proceeds to complete the acquisition of the mortgage servicing rights with respect to a $5.2 billion HECM MSR facility, make the semi-annual interest payment towards our non-funding corporate notes, and still maintain strong cash balances at quarter end.

[Graham Fleming, CEO at Finance of America]

As discussed previously, the Onity transaction which closed on June 30th represents more than the acquisition of servicing assets. It diversifies our servicing footprint, broadens the population of homeowners we can serve, and creates additional opportunities to introduce our proprietary solutions to customers who may benefit from them, further strengthening our position as the leading reverse mortgage company in the industry. Before turning the call over to Kristen, I'd like to spend a moment on why we remain so optimistic about the long-term opportunity. As shown on slide six, older homeowners hold substantial wealth in their homes, while rising costs are placing greater pressure on retirement cash flow. In today's rate environment, many traditional options for accessing that equity are less attractive. Together, these dynamics create a durable need for responsible home equity solutions and reinforce the long-term relevance of our platform.

[Graham Fleming, CEO at Finance of America]

We believe Finance of America is well-positioned to serve that need, given our specialized platform, broad product capabilities, and focus on helping homeowners thoughtfully incorporate home equity into their retirement planning. The macroeconomic and demographic need is clear. Kristen will now discuss how the investments we have made across distribution, technology, and proprietary products are strengthening our ability to capture that opportunity.

[Kristen Sieffert, President at Finance of America]

Thank you, Graham, and good afternoon, everyone. Last quarter, I said we were reaching an inflection point in the platform. The second quarter gives us greater confidence in that view. The investments we've made over the past two years across distribution, technology, and product are beginning to compound. The results are stronger demand, a more productive operating model, and a platform with increasing long-term earnings power.

[Kristen Sieffert, President at Finance of America]

First, demand is strengthening. Turning to slide eight, submissions exceeded $1 billion during the quarter, even in a rising rate environment, increasing approximately 11% sequentially and 19% year-over-year. While funded volume increased approximately 21% year-over-year to $730 million. Second, we're converting demand more efficiently. The clearest proof point, shown on slide nine, is retail. Retail opportunities increased 9%, submissions increased 19%, and funded loans increased 33%. Importantly, we achieved that growth with stable sales capacity, resulting in meaningful productivity improvements. Funded loans per call center loan officer increased nearly 30% from the first quarter. These results reflect structural improvements in how we engage customers, convert demand, and move borrowers through the origination process. Historically, growth depended more heavily on generating additional top-of-funnel opportunities. Now we're demonstrating our ability to generate more production from the pipeline we already have.

[Kristen Sieffert, President at Finance of America]

Our proprietary technology platform and AI-enabled capabilities are also supporting these improvements, helping us better understand customer needs, match homeowners with appropriate solutions, and improve efficiency throughout the origination process. Our digital experience is showing similar progress. In June, approximately 10,000 site visitors engaged with our pre-qualification engine, achieving our year-end monthly target six months ahead of schedule. More importantly, monthly pre-qualification offers increased nearly 90% from the first quarter, and time to application improved approximately 57%. These metrics demonstrate that we're creating a larger pool of engaged borrowers while making it easier and faster for customers to move through the application process. Third, our platform is becoming more valuable and scalable. Our proprietary products continue expanding the addressable market by providing customers greater flexibility and additional ways to access home equity. During the quarter, proprietary submissions increased approximately 20% and proprietary fundings increased approximately 25%.

[Kristen Sieffert, President at Finance of America]

As shown on slide 10, our retail and wholesale channels continue to reinforce one another. Retail provides direct consumer engagement and greater visibility into the customer journey, while wholesale extends our reach through trusted partners and brings our proprietary solutions to more borrowers across more markets. Together, they create multiple avenues for profitable growth while leveraging the same product platform and operating infrastructure. Stepping back, three things stood out this quarter. Demand is strengthening, conversion is improving, and our investments are compounding into a more scalable platform with durable earnings power. The market opportunity ahead of us is still large and under-penetrated, but the real story this quarter is conviction. We're building a stronger, more valuable business, not simply a bigger one. With that, I'll turn it over to Matt.

[Matt Engel, CFO at Finance of America]

Thank you, Kristen, and good afternoon, everyone. As Graham mentioned, the second quarter demonstrated continued strength in the underlying business while reported earnings reflected several market-driven and non-operating items. I'll provide additional color on the quarter, which is summarized by segment on slide 11 and in today's earnings release. We recognized a GAAP net loss of $29 million for the quarter, while adjusted net income totaled $19 million or $0.84 per share. The difference primarily reflects non-cash fair value adjustments on our portfolio, combined with certain one-time impacts during the quarter which negatively impacted our GAAP results. We recorded $84 million of negative fair value adjustments during the quarter. In addition to those impacting our portfolio related to higher interest rates, this also includes a $24 million adjustment related to our convertible notes as our stock price increased nearly $11 per share during the quarter.

[Matt Engel, CFO at Finance of America]

Because the convertible notes are carried at fair value indexed to our stock price, an increase in our stock price increases the value of the associated liability, creating a non-cash expense under GAAP. We also released our deferred tax asset valuation allowance, creating a tax benefit in the quarter of $42 million. This non-cash accounting adjustment reflects our expectation that future taxable income will support realization of these tax assets, and investors should expect a more normalized effective tax rate going forward. While these accounting adjustments can create meaningful quarter-to-quarter volatility in our GAAP earnings, they do not affect the underlying operating performance or cash generation of the business. We believe that adjusted net income continues to provide the clearest picture of the underlying earnings power of FOA.

[Matt Engel, CFO at Finance of America]

Adjusted earnings per share of $0.84 is a 53% improvement over the second quarter of 2025, and first half 2026 adjusted EPS of $1.94 improved 81% over the first half of 2025. Beginning with Retirement Solutions, continued demand, as evidenced by the 21% increase in funded volume compared to the second quarter of 2025, allowed the business to contribute relatively stable adjusted earnings for the sequential quarter, even while we continued investing in the business with higher personnel and marketing expenses to support future production. For the first half of 2026, Retirement Solutions generated a 21% increase in adjusted net income on 14% higher funded volume compared to the first half of 2025, and we believe these investments will continue to support higher production, stronger operating leverage, and increased earnings power over time.

[Matt Engel, CFO at Finance of America]

Portfolio Management completed a securitization of over $1 billion during June, which contributed to FOA's strong cash flow from originations and capital markets activity for the quarter. For the first half of the year, the segment has recognized $46 million in adjusted net income, a 24% improvement over the first half of 2025. Based on our first half performance and continued momentum across submissions and funded production, we are reaffirming our full year guidance of funded volume between $2.8 billion and $3.1 billion and adjusted EPS between $4.50 and $5 per share. Turning to our balance sheet and cash flows, as shown on slide 12, cash generation from originations and capital markets activities remained strong at $58 million in the quarter and approximately $116 million for the first half of 2026.

[Matt Engel, CFO at Finance of America]

This enabled us to complete the Onity portfolio acquisition, make the semi-annual interest payment on our non-funding corporate debt, and maintain strong quarter-end cash balances. As we have said before, strengthening the balance sheet remains foundational to unlocking the full value of the operating franchise we have built over the past several years. We are very pleased with the progress we have made. When we think about our balance sheet, we identify three key components: inventory loans, HECM MSR, and the residual fair value of our proprietary securitizations. The first category is inventory loans held at fair value that are yet to be sold or securitized. This is represented by loans held for investment and loans held for sale on our balance sheet.

[Matt Engel, CFO at Finance of America]

At the time of sale or securitization, we will recognize a cash premium and, depending on the securitization type, will record a HECM MSR or residual interest at fair value. These loans are financed via warehouse facilities, and we hold a small balance of haircut equity in them. When loans are securitized, in most cases, the assets will remain on our balance sheet with a corresponding liability in accordance with GAAP. For HECM loans, these are HMBS obligations, and for proprietary loans, these are non-recourse securitizations. For both categories, FOA recognizes an accreted yield on the adjusted net asset value we hold. Regarding the HECM MSR, the adjusted net asset value or the delta between the loans held for investment subject to HMBS obligations and the corresponding HMBS obligations totals $326 million as of June 30th, with financing of only $46 million, or roughly 14% leverage.

[Matt Engel, CFO at Finance of America]

We continue to pursue increased financing secured by this asset at a more appropriate attachment point. With respect to our residuals and proprietary securitizations, we have the ability over time to monetize the equity held in these assets through the call and reissue of the non-recourse securitizations. Proceeds from the monetization of the HECM MSR and proprietary residuals provides financial flexibility to our business. Our first priority is retiring the remaining $150 million of senior secured notes this November, which will materially reduce our non-funding debt, lower our financing costs, and improve recurring earnings. Looking ahead, once that debt is retired, the company will have greater options for a broad range of potential actions, such as further deleveraging, stock repurchases, dividends, or business investment.

[Matt Engel, CFO at Finance of America]

Before wrapping up, I want to call your attention to an amendment effective July 31st for the reporting structure of our Class B shares, which establishes a one-to-one alignment of the reported Class B shares with the underlying LLC ownership. This amendment does not change economic ownership or voting power, but provides a clearer view of fully diluted shares and market capitalization. With that, I'll turn the call back to Graham.

[Graham Fleming, CEO at Finance of America]

Thank you, Matt. The second quarter demonstrated continued progress across the business. We delivered strong growth in funded volume, expanded adjusted earnings, generated significant cash, completed the Onity transaction, and continued strengthening our balance sheet. The long-term opportunity in reverse mortgages continues to expand, and we believe Finance of America remains strategically positioned to capitalize on that opportunity. Just as importantly, the operational improvements we have discussed over the past several quarters are producing measurable results. Demand is strengthening, conversion and sales productivity are improving, and our proprietary products are expanding the ways we can serve older homeowners. We remain confident in our full-year outlook and focused on disciplined execution. As we continue reducing debt and improving the efficiency and scalability of the platform, we believe Finance of America is well positioned to capture the long-term opportunity in home equity and create durable shareholder value.

[Graham Fleming, CEO at Finance of America]

Thank you for joining us today. We will now open the line for questions.

[Operator]

We will now begin the question-and-answer session. Please limit yourself to one question and one follow-up. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. We ask that you pick up your handset when asking a question to allow for optimum sound quality. If you are muted locally, please remember to unmute your device. Please stand by while we compile the Q&A roster. Your first question comes from the line of Gaurav Mehta with Alliance Global Partners. Your line is open. Please go ahead.

[Gaurav Mehta, Analyst at Alliance Global Partners]

Thank you. I wanted to ask you on some of your comments around demand and submission volume. I was wondering if you are seeing any difference between the demand for your proprietary products and HECM products.

[Kristen Sieffert, President at Finance of America]

Yeah. We've seen growing demand for proprietary products recently, mostly as a function of the proprietary products offering better cash flow to the consumer. Those products, the amount available changes as interest rates change. It's typically whatever is best suited for the customer is where that demand lands, and right now, that's with the proprietary channel.

[Gaurav Mehta, Analyst at Alliance Global Partners]

Okay. As a follow-up, I wanted to ask you on your tangible equity value per share, it seems like it was slightly lower than 1Q. Can you help us understand why the tangible equity value went lower this quarter?

[Matt Engel, CFO at Finance of America]

Yeah. Part of it is just the reported loss for the quarter, the GAAP loss is the number we've quoted, which includes the fair value adjustments. That book number is what's driving it primarily.

[Gaurav Mehta, Analyst at Alliance Global Partners]

Okay. Thank you.

[Operator]

Your next question comes from the line of Timothy D'Agostino with B. Riley Securities. Your line is open. Please go ahead.

[Timothy D'Agostino, Analyst at B. Riley Securities]

Yeah. Hi. Thanks for taking the questions today. Just a minute, it'd be great to get an update if there's anything meaningful on the Helix platform and then the Joy AI. There was a slide in the last deck last quarter. I was just wondering if there's any meaningful updates there and what you're seeing in the accelerating operating leverage through more production, if that's what's driving it.

[Kristen Sieffert, President at Finance of America]

Yes. It's definitely the foundational platform that's driving those improvements. When we talk about the productivity gains from our loan officers as well as the improvements in the digital funnel with the metrics that I shared earlier, all of that is being driven through these AI platforms.

[Timothy D'Agostino, Analyst at B. Riley Securities]

Okay, great. Thank you. If I could just ask a second one, just to clarify, on capital allocation, with the Onity MSR Portfolio acquisition behind us and looking forward to the $150 million of potential debt repurchase, it kind of sounds like share buybacks might be on hold until that event. Is that the right way to think about it? Could you just provide a little more color on how you're thinking about capital allocation before the potential repurchase of $150 million? Thank you.

[Matt Engel, CFO at Finance of America]

Yeah, Tim, I think that's fair. I do think that our primary focus is the retirement of the $150 million here in just a few months from now, right? Past that, I think at our next quarterly earnings release, when we have a better sense of how wrap up 2026 and looking forward to 2027, where our stock's trading at the time, how the balance sheet looks. We'll make some of those decisions going forward. Between now and then, our primary focus is just retiring that 150.

[Timothy D'Agostino, Analyst at B. Riley Securities]

Okay, great. Thank you so much for taking the questions today.

[Operator]

Your next question comes from the line of Gabe Poggi with Raymond James. Your line is open. Please go ahead.

[Gabe Poggi, Analyst at Raymond James]

Hey, everybody. Thanks for taking the questions. I've got a couple if it's okay. Can you talk about gain on sale margin in the quarter for HECM product and HomeSafe product, and how that's trended relative to the first quarter?

[Matt Engel, CFO at Finance of America]

Yeah. The interest rate volatility did create a little volatility in the gain on sale margins as well during the quarter. I think HECM spreads remain tight. Not a lot of change there. I think on the proprietary side, we did see a little bit of impact there in terms of the executed securitization price we expect on those assets. I think Graham has talked in the past that when interest rates move suddenly, we don't always choose to reprice our pipeline. We have the ability to, but sometimes we choose not to from a customer disruption standpoint, and that would create some volatility in our margins going forward. Over the long term, we can kind of manage that a little better.

[Gabe Poggi, Analyst at Raymond James]

Do you have a specific number you can provide for the quarter for each of those?

[Matt Engel, CFO at Finance of America]

I don't think we break that number out right off the top. Let me see if we can get you something on the follow-up on that one.

[Gabe Poggi, Analyst at Raymond James]

Okay. Rates have obviously moved a lot since June 30th. Do you have any update on kind of, I know it's a GAAP mark and it's subject to a lot of volatility. Any update on where book value is today on a tangible basis?

[Matt Engel, CFO at Finance of America]

I think it's funny. I think you're absolutely right. It's even reversed itself a little bit in the last two days certainly. If generally Portfolio Management markdowns are tied to higher interest rates moved up considerably in July, and one would expect we would have a fair value write-down in July. The first four days of August, that's kind of gone the other way a little bit. I think we would've recouped some of that. I can't give the exact numbers. We haven't closed our books for July or for the third quarter yet. Directionally, you're correct on that assessment.

[Graham Fleming, CEO at Finance of America]

Gabe, just to add to that, some other components that go into fair value are home price appreciation, which has continued to remain strong, and ultimately credit spreads. We'll get an update on credit spreads in our September transaction.

[Gabe Poggi, Analyst at Raymond James]

Got it.

[Graham Fleming, CEO at Finance of America]

It's not just driven by the movement of rates. It's a three-legged stool.

[Gabe Poggi, Analyst at Raymond James]

On the Onity acquisition, can you talk about the impact to the bottom line? I know there's two parts to it, but what's closed? How do you think about that just beyond diversification of servicers?

[Graham Fleming, CEO at Finance of America]

Yeah, we acquired the asset, roughly had a book value of around $70 million. We'll expect to earn a yield in the mid-teens, and that will flow through the P&L here in the second half of the year.

[Gabe Poggi, Analyst at Raymond James]

Do you intend to add that to guidance as you think about guidance in the back half? I can say it another way, is that incorporated in current guidance?

[Graham Fleming, CEO at Finance of America]

Yeah, it's incorporated into the current guidance.

[Gabe Poggi, Analyst at Raymond James]

Okay. That's helpful. Lastly, just if you can, and maybe we take this offline, can you help tie the $58 million of cash flows you guys are referring to in 2Q to the $19 million of A&I?

[Matt Engel, CFO at Finance of America]

I think probably the best way to do that is we'll get our 10-Q filed later this week. There'll be additional information there with earnings by segment, which will help you kind of bridge some of that. I think we can help you walk through that 10-Q and the relevant disclosures to see if we can't build you back to that number.

[Gabe Poggi, Analyst at Raymond James]

Okay, that works. We can just circle up when the Q's filed. Thank you.

[Operator]

There are no further questions at this time. I will now turn the call back to Graham Fleming for closing remarks.

[Graham Fleming, CEO at Finance of America]

Yeah. Thank you everybody for participating in the Q2 call. We will look forward to updating our Q3 results in November. Thank you very much.

[Operator]

This concludes today's call. Thank you for attending. You may now disconnect.

Participants

Executives

• Graham Fleming, CEO
• Kristen Sieffert, President

Analysts

• Michael Fant, SVP of Finance at Finance of America
• Matt Engel, CFO at Finance of America
• Gaurav Mehta, Analyst at Alliance Global Partners
• Timothy D'Agostino, Analyst at B. Riley Securities
• Gabe Poggi, Analyst at Raymond James