Global asset manager Rithm Capital Corporation reported net income of $36.5 million, or $0.07 per diluted common share, for the first quarter ending March 31, 2025. That’s down from net income of $263.2 million and $0.50 per diluted share for the fourth quarter of 2024, though Rithm’s earnings available for distribution for Q1 2025 were $275.3 million and $0.52 per diluted share.
Rithm President and CEO Michael Nierenberg noted in a release that this most recent quarter “was marked by several achievements that reinforced the strength of our innovative approach, including the largest-ever mortgage servicing rights debt issuance.” He pointed to the strength of the company’s asset management, origination, and servicing platforms.
Rithm's mortgage originator and servicer Newrez LLC had total funded originations for the most recent quarter of $11.8 billion, up 9% year-over-year. “Our origination business continued to perform well,” said Baron Silverstein, president of Newrez, on an earnings call. He noted the company saw a 7% increase in lock volume and 54% increase in pre-tax income compared to Q1 2024.
In its originations business, Newrez had a 19% return on equity and $270 million in pre-tax income, excluding $180 million mortgage servicing rights (MSR) mark-to-market loss. Servicing totaled $845 billion in unpaid principal balance, up 30% from the first quarter of 2024, with $245 billion in third-party servicing, an increase of 110% year-over-year.
Silverstein called it “another great quarter” as Newrez continued its strategy focused on its direct-to-consumer recapture platform, technology, AI initiatives, and growing its third-party businesses, including originations.
“With Newrez being the number three-ranked servicer and the number five-ranked originator,” Silverstein said, “these results continue to show the power of the platform.” He noted the company will continue to invest in its distributed retail and third-party origination channels.
In its investment portfolio, Nierenberg pointed to Rithm’s Q1 2025 $900 million securitization on its MSR business as well as $1.5 billion that included two securitizations totaling $634 million in unpaid principal balances of non-QM loans. Non-QM production remains a strategic growth priority.
“Another good quarter for the company, despite all the market volatility we're seeing play out,” Nierenberg said of Rithm’s earnings. “All of our business lines performed extremely well.”
He said the company is focused on results and performance as well as manufacturing assets through its operating businesses, since it can underwrite, originate, and service assets from beginning to end.
At noon today, RIthm’s [NYSE: RITM] shares were trading at $10.80, up 2.47% from market open.
