Two Harbors Investment Corp. | 10-Q: FY2026 Q1 Revenue: USD 85.8 M

Revenue: As of FY2026 Q1, the actual value is USD 85.8 M.

EPS: As of FY2026 Q1, the actual value is USD 0.18.

EBIT: As of FY2026 Q1, the actual value is USD 42.86 M.

Two Harbors Investment Corp. operates as a single operating and reportable segment, therefore, segmented financial metrics are not available .

Operational Metrics

• Net Interest Expense: For the three months ended March 31, 2026, net interest expense was - $6,511 thousand, an improvement from - $20,332 thousand for the same period in 2025 .
• Net Servicing Income: The company reported net servicing income of $128,295 thousand for the three months ended March 31, 2026, compared to $153,662 thousand for the prior year period .
• Total Other (Loss) Income: Total other loss was - $35,985 thousand for the three months ended March 31, 2026, significantly less than the - $164,860 thousand reported for the three months ended March 31, 2025 .
• Total Expenses: Total expenses increased to $49,447 thousand for the three months ended March 31, 2026, from $47,094 thousand in the comparable 2025 period .
• Income (Loss) Before Income Taxes: The company achieved income before income taxes of $36,352 thousand for the three months ended March 31, 2026, a substantial improvement from a loss of - $78,624 thousand in the same period of 2025 .
• Net Income (Loss): Net income for the three months ended March 31, 2026, was $32,284 thousand, reversing a net loss of - $79,055 thousand in the three months ended March 31, 2025 .

Cash Flow

• Net Cash Provided by Operating Activities: Net cash provided by operating activities was $56,580 thousand for the three months ended March 31, 2026, down from $111,913 thousand in the prior year period .
• Net Cash Used in Investing Activities: Net cash used in investing activities was - $38,144 thousand for the three months ended March 31, 2026, a significant decrease from - $2,027,858 thousand in the same period of 2025 .
• Net Cash (Used in) Provided by Financing Activities: Net cash used in financing activities was - $320,239 thousand for the three months ended March 31, 2026, compared to net cash provided of $1,796,029 thousand in the three months ended March 31, 2025 .

Unique Metrics

• Mortgage Servicing Rights (MSR) Portfolio: The balance of MSR at fair value was $2,380,983 thousand as of March 31, 2026, slightly down from $2,421,910 thousand at December 31, 2025 . Changes in fair value due to valuation inputs or assumptions were $4,366 thousand, and other changes in fair value (primarily realization of cash flows) were - $48,375 thousand for the three months ended March 31, 2026 .
• Available-for-Sale Securities: The fair value of available-for-sale securities was $6,507,381 thousand at March 31, 2026, compared to $6,514,471 thousand at December 31, 2025 .
• Mortgage Loans Held-for-Sale: The fair value of mortgage loans held-for-sale increased to $18,536 thousand at March 31, 2026, from $13,630 thousand at December 31, 2025 .
• Total Serviced Mortgage Assets: The unpaid principal balance of total serviced mortgage assets was $199,207,354 thousand across 846,416 loans at March 31, 2026, a decrease from $203,228,767 thousand across 854,123 loans at December 31, 2025 .
• MSR Key Assumptions: As of March 31, 2026, the weighted average prepayment speed for MSR was 6.6%, weighted average delinquency was 0.9%, weighted average option-adjusted spread was 5.2%, and weighted average per loan annual cost to service was $65.03 .

Future Outlook and Strategy

Two Harbors Investment Corp. aims to leverage its core competencies in managing interest rate and prepayment risk to invest in its MSR and Agency RMBS portfolio, targeting more stable performance and sustainable stockholder value . A significant strategic development is the pending acquisition of all outstanding common stock by CrossCountry Intermediate Holdco, LLC (CCM) for $11.30 per share, expected to close in the second half of 2026, pending stockholder and regulatory approvals . This follows the termination of a prior merger agreement with UWM Holdings Corporation, for which CCM paid a $25.4 million termination fee on Two Harbors’ behalf .