Executive Summary

Q2 2025 headline GAAP EPS was $0.04 and Distributable EPS was $0.19; Distributable EPS prior to charge-offs rose to $0.45, reflecting stronger underlying earnings power as portfolio deployment accelerated .
Results missed S&P Global consensus: EPS $0.19 vs $0.26 est., revenue $88.0M vs $95.3M est.; normalized net income $7.0M vs $46.1M est. (driven by CECL reserve increase and higher REO-related expenses) . Estimates marked with an asterisk are from S&P Global.
Execution was strong: $2.6B originations/acquisitions (including a $0.4B JV portfolio purchase), $1.6B repayments, >9% average levered spread on new investments, and $0.2B of impaired loan resolutions at or above carrying value; portfolio grew to $18.4B and 94% performing .
Balance sheet catalysts: liquidity $1.1B, repriced $1.0B Term Loan B cutting spread by 65 bps and extending maturity to 2030; total credit facility capacity $19.1B with >$7B undrawn .
Q2 call was cancelled due to a tragic incident; prepared remarks and the full presentation were posted online. No formal quantitative guidance was provided; dividend maintained at $0.47 per share .

What Went Well and What Went Wrong

What Went Well
- Robust capital deployment and portfolio growth: $2.2B originations plus a $0.4B share of a performing senior loan portfolio acquired at a discount; portfolio rose to $18.4B with >9% average levered spread .
- Credit momentum: $0.2B impaired loan resolutions executed above carrying values; impaired loan balance down 55% from peak; office exposure down to 28% of portfolio from 36% YoY .
- Liability management: repriced $1.0B Term Loan B, reducing spread by 65 bps and extending maturity to 2030; $1.1B quarter-end liquidity and $19.1B facility capacity (> $7B undrawn) support continued turnover and deployment .
- Management quote (strategic context from prior quarter): “BXMT’s forward trajectory is propelled by three key drivers: portfolio turnover… resolution of impaired loans; and optimization of our balance sheet.” — CEO Katharine Keenan .
What Went Wrong
- Consensus miss: EPS and revenue came in below S&P Global consensus; normalized net income was also below expectations .
- GAAP drag from credit provisioning and REO: CECL reserve increased $45.6M; REO operating expenses were $47.8M in Q2, pressuring GAAP profitability despite stronger deployment .
- Sequential book value decline and leverage tick-up: Book value per share fell to $21.04 from $21.42; debt-to-equity was 3.8x vs 3.4x in Q1 on portfolio growth .

Financial Results

Metric	Q2 2024	Q1 2025	Q2 2025
Total Net Revenues ($USD Millions)	$126.8	$126.9	$133.9
GAAP Diluted EPS ($)	($0.35)	($0.00)	$0.04
Distributable EPS ($)	n/a	$0.17	$0.19
Distributable EPS prior to charge‑offs ($)	n/a	$0.42	$0.45
Dividend per Share ($)	n/a	$0.47	$0.47
Book Value per Share ($)	n/a	$21.42	$21.04
Net Income Margin % (GAAP)	(48.1%)	(0.3%)	5.2%

Notes: Net income margin is calculated as GAAP net income attributable divided by total net revenues using reported figures .

Versus S&P Global Consensus (Q2 2025)

Metric	Consensus	Actual	Surprise
Primary EPS ($)	0.26*	0.19*	Miss
Revenue ($)	95,326,460*	88,029,000*	Miss
Net Income Normalized ($)	46,059,710*	6,969,000*	Miss

Values marked with * retrieved from S&P Global.

Portfolio & Credit KPIs

KPI	Q4 2024	Q1 2025	Q2 2025
Portfolio Size ($B)	$17.0	$17.8	$18.4
Performing Portfolio (%)	93%	95%	94%
Impaired Loan Resolutions ($B)	$1.1	$0.4	$0.2
CECL Reserve ($M)	$734	$742 (balance sheet $741.5)	$755
CECL as % of Principal	n/a	3.9%	3.8%
Originations/Acquisitions ($B)	$0.4 (FY 2024)	$1.6	$2.6 (incl. $0.4B JV)
Repayments ($B)	$5.2 (FY 2024)	$1.8	$1.6
Avg. Levered Spread (new)	~+9%	>9%	>9%
Liquidity ($B)	$1.5	$1.6	$1.1
Debt-to-Equity (x)	3.5x	3.4x	3.8x
Office Exposure (% of portfolio)	33% (24% US + 9% Non-US)	29%	28%

Collateral Mix (% of Portfolio)

Category	Q4 2024	Q1 2025	Q2 2025
Multifamily	29%	30%	27%
US Office	24%	21%	20%
Non-US Office	9%	8%	8%
Industrial	12%	14%	18%
Hospitality	16%	15%	15%
Self-Storage	2%	3%	3%
Retail	3%	3%	4%
Life Sciences/Studio	2%	2%	1%
Other Property	5%	4%	4%

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Revenue, EPS, Margins	FY/Quarter	None issued	None issued	n/a
Dividend per Share	Quarterly	$0.47	$0.47	Maintained
Capital Deployment	2025	Directional only	Continued robust originations and repayments (no numeric guide)	n/a
Leverage Target	Ongoing	3–4x discussed previously	No change indicated (Q2 D/E 3.8x)	Maintained

No formal quantitative guidance was provided in Q2; management maintained the dividend.

Earnings Call Themes & Trends

Note: Q2 2025 call was cancelled; themes reflect Q2 presentation and prior calls.

Topic	Q4 2024 (Q-2)	Q1 2025 (Q-1)	Q2 2025 (Current)	Trend
Portfolio turnover & deployment	Turning to offense; $2.0B+ Q1’25 pipeline	$1.6B originations; $1.8B repayments; more in closing	$2.6B originations/acquisitions; $1.6B repayments	Accelerating
Impaired loan resolutions	$1.1B resolved in Q4; 93% performing	$0.4B resolved; 95% performing	$0.2B resolved; 94% performing	Continued progress
Office exposure	Down 28% YoY; 33% of portfolio	29%; repayments skewed to office	28%; $0.3B office repayments	Downward
Balance sheet & liquidity	D/E 3.5x; liquidity $1.5B	D/E 3.4x; liquidity $1.6B; $1B reinvesting CLO	Repriced $1B TLB (-65 bps); liquidity $1.1B	Constructive
International origination	38% EU/AU exposure	62% international in Q1 originations	68% international in Q2 originations	Increasing
Macro, tariffs & sectors	Recovery thesis; improving capital markets	Tariffs a watch item; multifamily/industrial resilient	Mix tilted to defensive sectors; >9% spreads	Defensive tilt

Management Commentary

“BXMT's forward trajectory is propelled by three key drivers: portfolio turnover… resolution of impaired loans; and optimization of our balance sheet.” — CEO Katharine Keenan .
“With $2 billion of loans closed or in closing so far in the second quarter, we are firmly playing offense and expect the timing headwinds we faced this quarter will shift to tailwinds in 2Q, all else equal.” — CFO Tony Marone (Q1 call) .
“Liquidity has definitively returned for high-quality office… [Spiral loan] repaid through a banner CMBS execution… implying an exit LTV on our loan of 29%.” — CEO Katharine Keenan (Q4 call) .

Q&A Highlights

Risk ratings and 4-rated loans: non-modified office 4-rated book down to ~$500M; focus on modifications and resolution path .
CLO reinvestment optionality: 30-month reinvestment feature enhances financing flexibility for new originations .
Growth outlook: targeting a portfolio “up towards $20B” as repayments continue and originations ramp .
Sector views: Hospitality monitored closely; multifamily and industrial remain resilient; strategy favors lighter business-plan risk .
International mix: Sustained 35–40% exposure historically; relative value and structural advantages abroad .
CECL methodology: general reserve reflects 3/31 conditions; not intended to capture short-term volatility .
Near-term resolutions: ~$200M under contract/in closing post-Q1 .

Estimates Context

EPS and revenue missed S&P Global consensus as GAAP was pressured by a $45.6M CECL reserve increase and $47.8M of REO expenses; Distributable EPS prior to charge-offs rose to $0.45, indicating stronger core earnings potential with deployment .
With portfolio size up to $18.4B, >9% average levered spreads on new assets, and lower corporate borrowing costs (Term Loan B -65 bps), forward models may need to increase NIM/DE run‑rate assumptions while accounting for ongoing REO expense and credit costs .
S&P Global consensus vs actual (Q2 2025): EPS 0.26 vs 0.19; Revenue $95.3M vs $88.0M; Normalized net income $46.1M vs $7.0M (miss across all three). Values marked with * retrieved from S&P Global.

Key Takeaways for Investors

Near-term headline misses mask improving underlying earnings power: DE prior to charge-offs advanced to $0.45 on deployment and resolution momentum .
Capital deployment is the catalyst: $2.6B originations/acquisitions at attractive spreads and $1.6B repayments expanded the book to $18.4B; expect earnings tailwinds as these balances season .
Credit risk is normalizing: impaired balances down 55% from peak; resolutions above carrying value support book value and dividend coverage over time .
Balance sheet optionality improved: -65 bps on $1B TLB and long-dated maturity profile, $19.1B facility capacity with >$7B undrawn supports continued turnover and accretive financing .
Mix shifting to defensive assets and geographies: office down to 28%; majority of Q2 originations in multifamily/industrial and 68% international, enhancing risk-adjusted returns .
Dividend maintained at $0.47; book value edged down to $21.04 on growth investment and provisioning but remains supported by resolution execution .
Monitor CECL/REO expense trajectory and pace of resolutions; faster runoff of non-earning assets and continued deployment are the keys to closing the gap to consensus.

Additional context: Q2 2025 conference call was cancelled; the company posted prepared remarks and a full presentation for investors .

BLACKSTONE MORTGAGE TRUST, INC. (BXMT)·Q2 2025 Earnings Summary