FOA · Finance Of America Companies Inc.

Finance of America Companies Inc. (FOA) reported Q1 2026 results reflecting the inherent volatility of our reverse mortgage and home equity financing model, where fair value changes from interest rates and home price shifts significantly influenced top-line performance. Revenue of $120.1 million marked a 27.5% year-over-year decline from $165.7 million, primarily due to less favorable fair value adjustments on our loan portfolios. This dynamic underscores our sensitivity to macroeconomic inputs, as portfolio management revenues bear the brunt of market fluctuations while we maintain focus on origination growth.

Net income of $17.5 million declined 42.0% from $30.2 million, with diluted EPS falling 63.8% to $0.88 from $2.43. These pressures arose from the revenue shortfall, though our Retirement Solutions segment demonstrated resilience through higher weighted average margins on reverse mortgage production compared to the prior year. As a leader in home equity-based financing for retirement planning, we continue developing products to expand our addressable customer base, positioning us to capitalize on growing demand for these solutions.

Operational cash flows used $130.9 million, up from $92.1 million year-over-year, as increased loan originations required greater working capital deployment. This reflects our commitment to scaling volumes in core retirement solutions, where we are investing in brand recognition, customer experience, and broker relationships to ultimately raise origination levels. Offsetting this, financing activities saw a $91.2 million improvement, driven by increased proceeds on nonrecourse debt net of payments, which funded our origination intensity without straining liquidity.

Expense management aligned with our long-term growth strategy, supporting investments in loan production, technology, and marketing to drive future volumes. Management's focus remains on core operations, excluding non-recurring items to better reflect ongoing business performance. These efforts position us to navigate market volatility while pursuing higher origination volumes through an expanded product suite tailored to retirement-focused borrowers. Future funding needs, including debt maturities, will be met via operating cash flows, portfolio investing, financing activities, and capital market access as required.