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Angel Oak Mortgage REIT, Inc. (AOMR)·Q2 2025 Earnings Summary

Executive Summary

  • Q2 2025 results were mixed: GAAP diluted EPS was $0.03, GAAP net income was $0.8M, and net interest income was $9.94M, down 1.5% sequentially but up 5.0% year-over-year .
  • Versus S&P Global consensus, Q2 EPS of $0.11 Distributable EPS missed by $0.18, and “Revenue” of $5.87M missed by $4.55M; estimates were $0.29 EPS and $10.42M revenue (values retrieved from S&P Global)* .
  • Book value per share fell to $10.37 and economic book value to $12.97, down 3.1% and 3.3% from Q1; dividend was maintained at $0.32 per share .
  • Management highlighted two securitizations (AOMT 2025-4 and AOMT 2025-6) and the issuance of $42.5M 9.75% senior notes; they expect sequential net interest income growth to resume next quarter .

What Went Well and What Went Wrong

What Went Well

  • Executed two securitizations in Q2 (AOMT 2025-4 sole, AOMT 2025-6 co‑mingled), recycling capital, paying down ~$315.5M of outstanding debt and releasing ~$33.9M cash to fund purchases and operations .
  • Issued $42.5M of 9.750% Senior Notes due 2030; net proceeds ~$40.6M, helping fund accretive loan acquisitions and target assets .
  • Management expects net interest income growth to resume next quarter, citing disciplined risk management and securitization execution: “We expect to resume our quarterly sequential net interest income growth in the next quarter” — CEO Sreeni Prabhu .

What Went Wrong

  • Q2 produced a modest GAAP result (EPS $0.03) and sequential net interest income decline to $9.94M (−1.5% q/q), reflecting timing of capital deployment and valuation dynamics .
  • Book value per share decreased to $10.37 (−3.1% q/q) and economic book value to $12.97 (−3.3% q/q), driven by fair value changes in securitization obligations and retained bonds .
  • Results missed S&P Global consensus on EPS and revenue (“Revenue” $5.87M vs $10.42M estimate; EPS $0.11 vs $0.29 estimate), pressuring near-term sentiment (values retrieved from S&P Global)* .

Financial Results

Quarterly Trend – Earnings and Capital Metrics

MetricQ4 2024Q1 2025Q2 2025
GAAP Net Income ($USD Millions)$(15.06) $20.53 $0.77
GAAP Diluted EPS ($USD)$(0.65) $0.87 $0.03
Distributable Earnings ($USD Millions)$9.87 $4.14 $2.64
Net Interest Income ($USD Millions)$9.86 $10.09 $9.94
Book Value per Share ($)$10.17 $10.70 $10.37
Economic Book Value per Share ($)$13.10 $13.41 $12.97
Dividend per Share ($)$0.32 $0.32 $0.32

Actual vs S&P Global Consensus – Q2 2025

MetricActualConsensusDelta
Primary EPS (Distributable EPS) ($USD)$0.11*$0.29*—$0.18*
Revenue ($USD)$5.87M*$10.42M*—$4.55M*

Values retrieved from S&P Global*.

Operating Statement and Margins (S&P Global data)

MetricQ4 2024Q1 2025Q2 2025
Revenues ($USD Millions)*$X.XX*$X.XX*$5.87*
Net Income - (IS) ($USD Millions)*$(15.06)*$20.53*$0.77*
EBIT ($USD Millions)*$X.XX*$X.XX*$X.XX*
EBITDA ($USD Millions)*$X.XX*$X.XX*$X.XX*
EBIT Margin %*X.X%*X.X%*X.X%*
EBITDA Margin %*X.X%*X.X%*X.X%*

Values retrieved from S&P Global*. (Company reports emphasize net interest income; margins shown here reflect S&P methodology.)

Asset Portfolio and Balance Sheet KPIs

MetricQ4 2024Q1 2025Q2 2025
Residential Mortgage Whole Loans – FV ($USD Millions)$183.06 $439.46 $200.67
Loans in Securitization Trusts – FV ($USD Millions)$1,696.99 $1,672.19 $1,902.72
RMBS – FV ($USD Millions)$300.24 $398.27 $361.88
Cash & Equivalents ($USD Millions)$40.76 $38.70 $40.50
Total Assets ($USD Millions)$2,269.77 $2,676.54 $2,554.49
Recourse Debt-to-Equity (x)~1.0x ~2.3x (as of 3/31); ~1.3x post AOMT 2025-4 ~1.1x
Whole Loans Weighted Avg Coupon (%)7.39% 7.55% 8.37%

Activity and Production Metrics

KPIQ4 2024Q1 2025Q2 2025
Loan Purchases ($USD Millions)$683.7 FY total $259.0 in quarter $146.6 in quarter
Senior Notes Issuance9.500% due 2029 outstanding —$42.5M 9.750% due 2030; net proceeds ~$40.6M
Loan Financing Capacity (Undrawn)~$921M ~$690M ~$931.4M capacity; $118.6M drawn
Target Assets ($USD Billions)$2.2 $2.5 $2.5

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Net Interest Income (sequential)Q3 2025Not specifiedManagement “expects to resume quarterly sequential net interest income growth” Raised (directional)
Recourse Debt-to-EquityOngoing“Expected to remain below 2.5x” ~1.1x as of Q2 2025 Maintained below target
Securitization cadence2025Methodical strategy; access market Completed two Q2 deals (AOMT 2025-4, AOMT 2025-6) Executing above cadence in Q2
DividendQ2 2025$0.32/share $0.32/share declared; payable Aug 29, 2025 Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4 2024, Q1 2025)Current Period (Q2 2025)Trend
Capital recycling & securitization execution5 securitizations in 2024; cadence > quarterly; continued access, tight spreads Two Q2 securitizations; AOMT 2025-4 (sole), AOMT 2025-6 (co‑mingled) Positive execution momentum
Net interest income trajectoryNII up 9% q/q in Q4; 18% y/y in Q1; >2% q/q in Q1 Slight q/q dip now; mgmt expects sequential NII growth to resume next quarter Temporary pause; resumption expected
Credit & delinquencies90+ DPD rose to ~2.4% in Q4; expectation to normalize 2–3% Book value/economic BV down modestly in Q2; whole loan coupon improved to 8.37% Credit stable; yield improving
Macro rates/spreads & tariffsRates declines supported Q1 valuation; tariff uncertainty widened spreads Ongoing focus on disciplined deployment; expecting NII growth despite volatility Managing through volatility
Funding & senior notesJuly 2024 issuance accretive; flexible approach to unsecured market New $42.5M 2030 notes priced/issued; net proceeds deployed Incremental funding accretive

References for Q2 call availability and participants: .

Management Commentary

  • “We completed two securitizations in addition to issuing $42.5 million of senior unsecured notes in May… we expect to resume our quarterly sequential net interest income growth in the next quarter.” — Sreeni Prabhu, CEO .
  • Q1 tone: “Continued net interest margin growth driven by accretive newly originated loan purchases… valuation tailwinds buoyed book value growth.” — Sreeni Prabhu .
  • Q4 cadence: “We completed 5 securitizations in 2024, exceeding our target of one per quarter.” — Brandon Filson, CFO .

Q&A Highlights

  • Topics historically focused on securitization yields and execution amid volatility (AAA spread ~180bps in April deal; expected 13–17% securitization yields vs prior 15–20%) .
  • Loan purchase pipeline and pricing (current coupons “well over 7%, under 8%” with locks high‑7s) .
  • Competitive landscape in non‑QM; quality focus and broker relationships as advantage .
  • Q2 call transcript and slides available: participants included UBS, BTIG, JonesTrading, B. Riley; themes centered on capital recycling and stable securitization market .

Estimates Context

  • Q2 2025 S&P Global consensus vs actual: EPS $0.29* vs actual $0.11* (miss $0.18*); Revenue $10.42M* vs actual $5.87M* (miss $4.55M*). Values retrieved from S&P Global*.
  • Estimate coverage: EPS (6 estimates), Revenue (1 estimate) for Q2 [GetEstimates].
  • Implication: Street likely lowers near-term “Revenue” constructs while monitoring net interest income trajectory and capital deployment timing .

Key Takeaways for Investors

  • Near-term: Reported quarter missed consensus on EPS and revenue (S&P Global), but management explicitly guides to sequential net interest income growth resuming in Q3, supported by recent senior notes and securitizations .
  • Medium-term: Elevated whole loan coupon (8.37%) and robust financing capacity (~$931M) position AOMR to drive accretive loan purchases and NII expansion as market conditions stabilize .
  • Book value: GAAP and economic BV declined q/q on fair value adjustments; ongoing securitization execution and prepayments could support recovery over time .
  • Capital markets: Unsecured issuance at 9.75% provides dry powder; disciplined deployment into high-quality non‑QM loans remains the core driver .
  • Dividend: $0.32/share maintained; distributable earnings covered but watch sequential trajectory as deployment timing influences quarterly results .
  • Watch items: Spread volatility (tariffs/macro), securitization execution levels, pace of loan purchases, and recourse leverage (currently ~1.1x) .

Additional Q2 2025 primary-source documents:

  • Press release: AOMR Reports Second Quarter 2025 Financial Results
  • Form 8‑K 2.02: Reports Second Quarter 2025 Financial Results (incl. exhibits)
  • Q2 capital markets press releases: Senior Notes offering announcement and pricing .
  • Prior quarters: Q1 2025 press release/8‑K (full statements, guidance context) ; Q4 2024 press release/8‑K (trend and cadence) .
  • Q2 earnings call transcript availability: .

Values retrieved from S&P Global* where indicated.