AGNC Investment Pref Shares AGNC 9.67459 Perp 04/11/25 | 10-Q: FY2025 Q2 EPS: USD -0.17

EPS: As of FY2025 Q2, the actual value is USD -0.17.

Segment Revenue

• Agency RMBS: $73,232 million as of June 30, 2025, compared to $65,367 million as of December 31, 2024.
• Credit Risk Transfer Securities: $613 million as of June 30, 2025, compared to $633 million as of December 31, 2024.
• Non-Agency Securities: $43 million as of June 30, 2025, compared to $251 million as of December 31, 2024.
• U.S. Treasury Securities: $3,565 million as of June 30, 2025, compared to $1,575 million as of December 31, 2024.

Operational Metrics

• Net Income: - $140 million for the three months ended June 30, 2025, compared to - $48 million for the same period in 2024.
• Operating Costs: Total operating expenses were $28 million for the three months ended June 30, 2025, compared to $24 million for the same period in 2024.

Cash Flow

• Operating Cash Flow: $372 million for the six months ended June 30, 2025, compared to $0 for the same period in 2024.

Unique Metrics

• TBA Securities: Net carrying value of $101 million as of June 30, 2025, compared to - $26 million as of December 31, 2024.
• Investment Portfolio: $82.3 billion as of June 30, 2025, compared to $73.3 billion as of December 31, 2024.

Future Outlook and Strategy

Core Business Focus

• Investment Strategy: The company plans to continue investing primarily in Agency RMBS and other mortgage-related securities, with a focus on managing interest rate and prepayment risks through active portfolio management and hedging strategies.
• Capital Deployment: The company raised $799 million of accretive capital through its At-the-Market offering program during the second quarter of 2025, with plans to deploy this capital primarily into higher-coupon specified pools with favorable prepayment attributes.

Non-Core Business

• CRT and Non-Agency Securities: The company holds a smaller portion of its portfolio in CRT and non-Agency securities, with a focus on managing credit risk and optimizing returns.

Priority

• Leverage and Liquidity: The company maintained a tangible ‘at risk’ leverage of 7.6x as of June 30, 2025, and a substantial liquidity position of $6.4 billion in unencumbered cash and Agency RMBS, representing 65% of tangible equity.
• Hedging: Interest rate hedges equaled 89% of the outstanding balance of repurchase agreements used to fund the investment portfolio, with a duration gap of 0.2 years at quarter-end.

Outlook Summary

• The company anticipates a constructive outlook for Agency RMBS performance, driven by anticipated bank regulatory reforms, improved supply dynamics, and high mortgage rates tempering prepayment activity.
• The company expects stabilizing spreads at historically wide levels and reduced risk of adverse consequences from GSE reform to provide a favorable environment for Agency RMBS as a fixed income asset class.