Angel Oak Mortgage REIT, Inc. reported robust first-quarter 2025 financial results, buoyed by a surge in net interest income and strategic loan acquisitions. The Atlanta-based mortgage real estate investment trust posted GAAP net income of $20.5 million, or $0.87 per diluted share, for the quarter that ended March 31.
The per-share earnings results tripled expectations of $0.29 per share, and the results were driven partly by increased investment in Non-QM residential mortgage loans, the company pointed out. Revenue for this most recent quarter was $32.9 million, a 30% increase year-over-year.
Net interest income rose to $10.1 million, a 17.6% year-over-year increase from Q1 2024, and a 2.3% gain over Q4 2024. Distributable earnings for the quarter totaled $4.1 million, or $0.17 per diluted share.
Angel Oak Mortgage REIT CEO and President, Sreeni Prabhu, noted that nearly $260 million in non-QM loan purchases helped fuel earnings growth. Following the earnings announcement, Angel Oak Mortgage’s stock saw a pre-market price increase of 4.19%, reaching $9.95 per share.
"Our priority is to drive long-term earnings accretion through our focused operational strategy while appropriately managing risk," Prabhu emphasized on an earnings call this morning. In a release, noted, “Despite recent volatility caused by broad uncertainty around tariffs, we look to continue expanding earnings through additional loan purchases with the capital made available by our post-quarter end securitization.”
That securitization, which was completed in April, allowed the company to reduce debt by $242.4 million while releasing $24.7 million in cash, which it said is being reinvested in new loans and used to pay down repurchase obligations.
Going forward, the company pointed to several risks and challenges, including:
- Rising interest rates could impact mortgage demand;
- Market volatility in securitization could affect asset valuation;
- Increased competition from traditional agency lenders;
- Economic uncertainty and potential regulatory changes; and
- Dependence on the non-QM mortgage market’s growth trajectory.
