Executive Summary

Record revenue and solid EPS beat vs consensus: Q3 revenue $178.68M and diluted EPS $1.22 vs S&P Global consensus revenue $176.47M and EPS $1.206; beats driven by stable net yield, higher investment income, and disciplined OpEx; loss ratio rose on seasonality/seasoning but remained manageable . Consensus figures marked with asterisks below; values retrieved from S&P Global.*
Operating leverage intact: expense ratio fell to a record-low 19.3% as underwriting/operating expenses held flat while revenue grew; management reiterated no unusual one-timers and noted typical Q4 seasonal uptick in people-related expenses .
Portfolio growth and credit quality: NIW $13.0B and primary IIF a record $218.4B; 12‑month persistency 83.9% and default rate 1.05% with macro and housing broadly resilient; defaults rose with normal seasonality/seasoning, with Q4 likely to show further seasonal impact .
Capital and risk transfer strength; buybacks continue: PMIERs excess assets ~$1.37B (available $3.37B vs required $2.00B); $24.6M repurchased in Q3, $256M authorization remaining; reinsurance markets “very robust,” with forward quota share/XOL coverage locked for 2025–2026 and partial 2027 .

What Went Well and What Went Wrong

What Went Well
- Record top-line and resilient earnings: “Total revenue in the Q3 was a record $178.7 million,” GAAP net income $96.0M; CEO: “We again delivered strong operating performance… and standout financial results” .
- Operating efficiency: expense ratio reached a record-low 19.3% as OpEx remained tightly managed; CFO: “There was nothing in particular… and if you look at the raw dollars, it’s within $200,000 of last quarter” .
- Portfolio growth/quality and macro resilience: NIW $13.0B; IIF $218.4B; management highlighted resilient labor and housing backdrops supporting cures and low losses; CEO: “We’re well-positioned… delivering through-the-cycle growth” .
What Went Wrong
- Higher loss costs: loss ratio increased to 12.3% (Q2: 9.0%; Q3’24: 7.2%) as claims/claim expenses rose with seasonality and seasoning; CFO flagged expectation of additional seasonal impact in Q4 .
- Defaults ticked up: default inventory rose to 7,093 (vs 6,709 in Q2), with a 1.05% default rate; management attributes to normal seasonal patterns and book seasoning .
- Regional softness persists: continued monitoring of Florida, Texas, Sunbelt and Mountain West where price trends softened; strength in Northeast/Midwest offsets, but dispersion bears watching .

Financial Results

Q3 actuals vs prior periods

Metric	Q3 2024	Q2 2025	Q3 2025
Total Revenue ($M)	166.09	173.78	178.68
Net Premiums Earned ($M)	143.34	149.07	151.32
Net Investment Income ($M)	22.47	24.95	26.77
GAAP Net Income ($M)	92.81	96.15	96.00
Diluted EPS ($)	1.15	1.21	1.22
Adjusted Diluted EPS ($)	1.15	1.22	1.21
Loss Ratio (%)	7.2	9.0	12.3
Expense Ratio (%)	20.3	19.8	19.3
Combined Ratio (%)	27.5	28.8	31.5

Q3 2025 actual vs S&P Global consensus (single-quarter)

Metric	Consensus	Actual	Surprise
Revenue ($M)	176.47*	178.68	+2.21
Diluted EPS ($)	1.206*	1.22	+0.014

Values marked with * retrieved from S&P Global via GetEstimates. Number of contributing estimates: EPS (6), Revenue (4).*

Key operating KPIs

KPI	Q3 2024	Q2 2025	Q3 2025
New Insurance Written (NIW, $B)	12.22	12.46	13.01
Primary Insurance in Force (IIF, $B)	207.54	214.65	218.38
Risk in Force (RIF, $B)	55.25	57.50	58.54
12‑Month Persistency (%)	85.5	84.1	83.9
Default Inventory (loans)	5,712	6,709	7,093
Default Rate (%)	0.87	1.00	1.05
Net Premium Yield (%)	0.28	0.28	0.28
Core Yield (bps)	—	34.2	34.2
PMIERs Available Assets ($M)	3,006.9	3,244.5	3,370.0
PMIERs Required Assets ($M)	1,735.8	1,926.5	2,003.4

Capital management snapshots

Repurchases: Q3 buyback $24.6M (628k shares at $39.13); cumulative $319M since inception; $256M capacity remaining .
Book value per share (ex-AOCI): $28.71 (Q3’24), $32.08 (Q2’25), $33.32 (Q3’25) .

Segment breakdown: NMIH reports as a single MI segment; no separate operating segments disclosed .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance/Commentary	Change
Core premium yield	Near-term	“Core yield… 34.1 bps” (Q2)	“Core yield… 34.2 bps… expect plus-minus that number” (Q3)	Maintained/stable
Expense ratio seasonality	2H/Q4	Typical Q4 heavier due to people-related accruals (implied historical)	Reiterated that Q4/ Q1 tend to be heavier; no Q3 one-timers	Maintained
Claims seasonality	2H	Noted seasonal cure/claim patterns (Q1 commentary)	Expect additional seasonal impact in Q4; normalization over time	Maintained
Reinsurance capacity	2025–2027	Forward QSR/XOL locked for 2025–2026; partial 2027 (Q2)	“Very robust” markets; reaffirmed forward coverage and optimization discussions underway (Q3)	Maintained
Share repurchases	Ongoing	Roughly ~$25M/quarter cadence; opportunistic flexibility (Q2)	Continued ($24.6M in Q3); $256M capacity remaining (Q3)	Maintained

Management does not provide formal quantitative revenue/EPS guidance .

Earnings Call Themes & Trends

Topic	Q1 2025	Q2 2025	Q3 2025	Trend
Macro & housing	Resilient backdrop; strong cures; record results	Resilient with secular demand; discipline across MI market	Resilience persists; watch labor/hiring and consumer confidence	Stable-positive; cautious on macro signals
Credit performance	Seasonality aided cures; normalization expected in newer vintages	Defaults fell q/q; hurricane-related NODs curing	Defaults up seasonally; normalization to continue; Q4 seasonal uptick expected	Normalizing with seasonality
Regional trends	—	Monitoring Florida/Texas/Sunbelt softness	Same geos under pressure; NE/Midwest strong	Unchanged dispersion
Pricing/competition	Discipline across MI; risk-based pricing (Rate GPS) embedded	Industry pricing balanced/constructive	New-entrant chatter; high bar to enter; incumbents well-positioned	Constructive; barriers to entry high
Reinsurance strategy	Comprehensive risk transfer; TCS IT extension supports platform	Forward QSR+XOL locked; potential optimization tweaks	Prefer traditional reinsurance for forward coverage; markets robust	Consistent preference; strong market
Capital return	$25.9M buyback in Q1	~$25M/quarter cadence described	$24.6M in Q3; $256M remaining	Ongoing, disciplined
Expense discipline	Expense ratio 20.2%	Record-low 19.8%; no one-offs	Record-low 19.3%; Q4/Q1 usually heavier	Improving leverage; seasonal pattern intact

Management Commentary

Strategic tone: “We again delivered strong operating performance, consistent growth in our high-quality insured portfolio, and standout financial results… well-positioned to continue delivering differentiated growth, returns and value for our shareholders” – CEO .
Credit/risk posture: “We’ve maintained a proactive stance with respect to our pricing, risk selection, and reinsurance decisioning… the prudent and appropriate course” – CEO .
Core yield outlook: “Given the strength of the in‑force book, we would expect… that kind of number for the core yield will be good” – CFO on ~34.2 bps core yield .
Competition: “It is not easy at all… very high bar… six incumbent MI players are all serving the market incredibly well” – CEO on potential new entrants .
Reinsurance markets: “Reinsurance markets remain very robust… locked‑in capacity… preference [recently] for traditional reinsurance… cost, flexibility, and speed of execution” – CFO .

Q&A Highlights

Defaults/seasonality: Management cited muted seasonality vs history and portfolio seasoning driving higher new defaults; expects additional seasonal impact in Q4 while overall portfolio remains high quality .
Competitive dynamics/new entrant: CEO views high barriers and no clear market need; incumbents have ample capacity and customer trust .
Macro/regional watchlist: Broad resilience persists; monitoring labor-market hiring pace and consumer confidence; softness in Florida/Texas/Sunbelt/Mountain West; strength in NE/Midwest .
Reinsurance mix: Preference for traditional XOL/quota share for forward coverage; ILN remains a tool but focus on cost/flexibility/execution .
Persistency vs rates/refi: If rates fall, persistency pressure offset by higher NIW and potential MI recapture; many refinancers likely still need MI; core yield stability highlighted .
Expenses: No unusual items in Q3; typical Q4/Q1 seasonality to lift expense ratio .

Estimates Context

Q3 2025 beats: Revenue $178.68M vs $176.47M*; EPS $1.22 vs $1.206*; EPS estimates from 6 analysts, revenue from 4. Implies modest beat on both the top and bottom lines . Values marked with * retrieved from S&P Global via GetEstimates.*
Implications for estimates: Stable net/core yield, record low expense ratio, and higher investment income support forward EPS; seasonal loss ratio pressure and normalization in newer vintages are known and guided, suggesting limited need for major estimate changes barring macro deterioration .

Key Takeaways for Investors

Durable earnings engine: Record revenue, stable core yield (~34 bps), and operating leverage (19.3% expense ratio) underpin earnings resilience through cycles .
Credit normalization manageable: Higher loss ratio reflects seasonality/seasoning, with management pre‑flagging Q4 seasonal claims; default rate remains near ~1% amid resilient macro/housing .
High-quality, growing book: NIW acceleration and record IIF with strong persistency sustain embedded value growth .
Strong capital/risk transfer: ~$1.37B PMIERs excess and multi‑year forward reinsurance coverage provide flexibility for growth and buybacks .
Capital return cadence intact: Continued ~$25M/quarter repurchases with $256M authorization remaining; supportive to per‑share compounding .
Competitive moat: Pricing discipline, customer relationships, and capital intensity pose a high bar for new entrants; industry remains constructive .
Near-term trading lens: Modest beat and efficiency gains are positives; watch loss ratio seasonality into Q4 and any macro/labor softening or regional housing dispersion as potential sentiment swings .

Notes:

All non-estimate figures sourced from NMIH Q3 2025 8‑K/press release and earnings calls as cited.
Consensus figures marked with * are retrieved from S&P Global via GetEstimates (EPS mean 1.20553; revenue mean $176.47M; EPS # est 6; revenue # est 4).* [Values provided by S&P Global]

NMI Holdings, Inc. (NMIH)·Q3 2025 Earnings Summary