Finance of America Companies Inc. 2026 Q2 Earnings Call

You may now begin. 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.

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.

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

Graham? 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.

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.

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.

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.

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.

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 9, 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.

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%.

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.