Redwood Trust Reports First Quarter Financial Results; Mortgage Banking Production Reaches a Record $8.5 Billion
MILL VALLEY, Calif.--( BUSINESS WIRE)--Redwood Trust, Inc. (NYSE:RWT; "Redwood", the "Company"), a leader in expanding access to housing for homebuyers and renters, today reported its financial results for the quarter ended March 31, 2026.
First Quarter 2026 Highlights
Key Financial First Quarter 2026 Results and Metrics
“We delivered a third consecutive quarter of record mortgage banking volume, as Sequoia and Aspire continued to scale while maintaining disciplined margins,” said Christopher Abate, Chief Executive Officer of Redwood Trust. “What stands out in this environment is not just the level of production, but how we’re processing it using active distribution and technology to drive capital turnover and efficiently manage risk. As we expand our product set and deepen relationships across our ecosystem, we are seeing sustained demand from institutional investors seeking consistent access to the high-quality assets we source.”
Three Months Ended
3/31/2026
12/31/2025
Financial Performance
Book Value per Common Share
$
7.12
$
7.36
Economic Return on Book Value (3)
(0.8
)%
2.6
%
Net (Loss) Income per Basic Common Share
$
(0.07
)
$
0.13
Non-GAAP EAD per Basic Common Share (non-GAAP) (1)
$
0.21
$
0.20
Non-GAAP Core Segments EAD per Basic Common Share (4)
$
0.28
$
0.33
Dividends per Common Share
$
0.18
$
0.18
GAAP Segment Net (Loss) Income Results Summary
($ in millions)
Three Months Ended
3/31/2026
12/31/2025
Core Segments:
Mortgage Banking Platforms:
Sequoia Mortgage Banking
$
37.8
$
33.3
Aspire Mortgage Banking
2.3
3.3
CoreVest Mortgage Banking
(3.4
)
6.8
Total Mortgage Banking Platforms
$
36.7
$
43.5
Redwood Investments
(8.0
)
15.2
Total Core Segments
$
28.7
$
58.7
Legacy Investments
$
(13.1
)
$
(22.9
)
Corporate/Other
$
(22.9
)
$
(17.5
)
Total GAAP Net (Loss) Income
$
(7.3
)
$
18.3
Mortgage Banking Platforms
Sequoia Mortgage Banking (5)
Aspire Mortgage Banking (5)
CoreVest Mortgage Banking (5)
Redwood Investments
Legacy Investments
Capital and Financing
____________________
First Quarter 2026 Redwood Review and Supplemental Tables Available Online
A further discussion of Redwood's business and financial results is included in the first quarter 2026 Shareholder Letter and Redwood Review which are available under "Financial Info" within the Investor Relations section of the Company’s website at redwoodtrust.com/investor-relations. Additional supplemental financial tables can also be found within this section of the Company's website.
Conference Call and Webcast
Redwood will host an earnings call today, April 29, 2026, at 5:00 p.m. Eastern Time / 2:00 p.m. Pacific Time to discuss its first quarter 2026 financial results. The number to dial in order to listen to the conference call is 1-877-423-9813 in the U.S. and Canada. International callers must dial 1-201-689-8573. A replay of the call will be available through midnight on Wednesday, May 13, 2026, and can be accessed by dialing 1-844-512-2921 in the U.S. and Canada or 1-412-317-6671 internationally and entering access code #13759155.
The conference call will be webcast live in listen-only mode through the News & Events section of Redwood’s Investor Relations website at https://www.redwoodtrust.com/investor-relations/news-events/events. To listen to the webcast, please go to Redwood's website at least 15 minutes before the call to register and to download and install any audio software needed. An audio replay of the call will also be available on Redwood's website following the call. Redwood plans to file its Quarterly Report on Form 10-Q with the Securities and Exchange Commission by Monday, May 11, 2026, and also make it available on Redwood’s website.
REDWOOD TRUST, INC.
Consolidated Income Statements (1)
Three Months Ended
($ in millions, except share and per share data)
3/31/26
12/31/25
Net Interest Income
$
34.7
$
25.9
Non-interest income
Mortgage banking activities, net
32.0
53.1
Investment fair value changes, net
(23.2
)
(0.5
)
HEI income, net
7.1
3.0
Servicing income, net
8.0
3.6
Fee income, net
2.9
1.8
Other income, net
2.4
2.2
Realized gains, net
—
(1.8
)
Total non-interest income, net
$
29.2
$
61.3
General and administrative expenses
(49.4
)
(40.8
)
Portfolio management costs
(8.7
)
(4.8
)
Loan acquisition costs
(6.7
)
(5.4
)
Other expenses
(7.1
)
(8.2
)
Benefit from (Provision for) income taxes
2.5
(8.0
)
Net (loss) income
$
(5.5
)
$
20.0
Dividends on preferred stock
(1.8
)
(1.8
)
Net (loss) income (related) available to common stockholders
$
(7.3
)
$
18.3
Weighted average basic common shares (thousands)
124,769
126,295
Weighted average diluted common shares (thousands) (2)
124,769
126,570
(Loss) Earnings per basic common share
$
(0.07
)
$
0.13
(Loss) Earnings per diluted common share
$
(0.07
)
$
0.13
Regular dividends declared per common share
$
0.18
$
0.18
(1)
Certain totals may not foot due to rounding.
(2)
Actual shares outstanding (in thousands) at March 31, 2026 and December 31, 2025 were 125,015 and 124,460, respectively
REDWOOD TRUST, INC.
Consolidated Balance Sheets (1)
($ in millions, except share and per share data)
3/31/26
12/31/25
Residential consumer loans
$
21,300
$
17,936
Residential investor loans
3,311
3,617
Real estate securities
476
423
Home equity investments (HEI)
341
330
Servicing investments
300
302
Strategic investments
107
102
Cash and cash equivalents
202
256
Other assets
779
736
Total assets
$
26,816
$
23,701
Asset-backed securities issued, net
$
20,418
$
17,492
Debt obligations, net
4,867
4,799
Other liabilities
574
427
Total liabilities
$
25,859
$
22,718
Stockholders' equity
957
983
Total liabilities and equity
$
26,816
$
23,701
Common shares outstanding at period end (thousands)
125,015
124,460
GAAP book value per common share
$
7.12
$
7.36
(1)
Certain totals may not foot due to rounding.
Segment Financial Information (1)(2)
Three Months Ended March 31, 2026
(In Millions)
Sequoia
Mortgage
Banking
Aspire
Mortgage
Banking
CoreVest
Mortgage
Banking
Redwood
Investments
Legacy
Investments
Corporate/
Other
Total
Interest income
$
61.3
$
18.4
$
4.2
$
268.7
$
4.0
$
0.3
$
356.9
Interest expense
(36.3
)
(14.8
)
(2.1
)
(256.3
)
(12.7
)
—
(322.2
)
Net interest income (expense)
25.0
3.6
2.1
12.4
(8.7
)
0.3
34.7
Non-interest income (loss)
Mortgage banking activities, net
22.1
2.7
7.2
—
—
—
32.0
Investment fair value changes, net
—
—
(0.3
)
(15.4
)
(7.5
)
—
(23.2
)
HEI income, net
—
—
—
0.6
6.5
—
7.1
Servicing Income, net
—
—
—
8.0
—
—
8.0
Fee Income, net
—
—
2.8
0.2
(0.1
)
—
2.9
Other income, net
—
—
0.6
0.9
1.0
—
2.4
Realized gains, net
—
—
—
—
—
—
—
Total non-interest income, net
22.1
2.7
10.4
(5.8
)
(0.1
)
—
29.2
General and administrative expenses
(7.0
)
(2.5
)
(13.0
)
(3.4
)
—
(23.5
)
(49.4
)
Portfolio management costs
—
—
—
(4.2
)
(4.5
)
—
(8.7
)
Loan acquisition costs
(2.8
)
(1.0
)
(2.8
)
—
—
—
(6.7
)
Other expenses
—
—
(2.0
)
(5.1
)
—
—
(7.1
)
Benefit from (Provision for) income taxes
1.2
(0.3
)
2.1
(1.4
)
0.6
0.3
2.5
Net Income (Loss)
$
38.4
$
2.5
$
(3.3
)
$
(7.3
)
$
(12.8
)
$
(22.9
)
$
(5.5
)
Preferred Dividends
(0.5
)
(0.2
)
(0.1
)
(0.7
)
(0.3
)
—
(1.8
)
Net income (loss) available (related) to common stockholders
$
37.8
$
2.3
$
(3.4
)
$
(8.0
)
$
(13.1
)
$
(22.9
)
$
(7.3
)
Total Assets
$
2,573.7
$
891.5
$
329.3
$
21,903.5
$
945.0
$
172.7
$
26,815.8
Three Months Ended December 31, 2025
(In Millions)
Sequoia
Mortgage
Banking
Aspire
Mortgage
Banking
CoreVest
Mortgage
Banking
Redwood
Investments
Legacy
Investments
Corporate/
Other
Total
Interest income
$
52.3
$
14.7
$
6.3
$
248.6
$
4.7
$
0.5
$
327.0
Interest expense
(34.3
)
(11.8
)
(4.3
)
(233.7
)
(16.9
)
—
(301.0
)
Net interest income (expense)
17.9
2.9
2.0
14.9
(12.2
)
0.5
25.9
Non-interest income (loss)
Mortgage banking activities, net
35.2
5.2
12.7
—
—
—
53.1
Investment fair value changes, net
—
—
—
7.6
(8.1
)
—
(0.5
)
HEI income, net
—
—
—
0.5
2.5
—
3.0
Servicing Income, net
—
—
—
3.6
—
—
3.6
Fee Income, net
—
—
1.7
0.2
(0.1
)
—
1.8
Other income, net
—
—
1.9
0.8
(0.6
)
—
2.2
Realized gains, net
—
—
—
—
(1.8
)
—
(1.8
)
Total non-interest income, net
35.2
5.2
16.3
12.7
(8.1
)
—
61.3
General and administrative expenses
(10.0
)
(2.7
)
(8.9
)
(1.1
)
—
(18.1
)
(40.8
)
Portfolio management costs
—
—
—
(2.8
)
(2.0
)
—
(4.8
)
Loan acquisition costs
(2.1
)
(0.7
)
(2.7
)
—
—
—
(5.4
)
Other expenses
—
—
(2.0
)
(6.2
)
—
—
(8.2
)
Provision for income taxes
(7.3
)
(1.1
)
2.3
(1.8
)
(0.2
)
0.2
(8.0
)
Net Income (Loss)
$
33.8
$
3.5
$
7.0
$
15.7
$
(22.5
)
$
(17.5
)
$
20.0
Preferred Dividends
(0.5
)
(0.2
)
(0.1
)
(0.6
)
(0.4
)
—
(1.8
)
Net income (loss) available (related) to common stockholders
$
33.3
$
3.3
$
6.8
$
15.2
$
(22.9
)
$
(17.5
)
$
18.3
Total Assets
$
2,411.8
$
909.3
$
357.4
$
18,789.6
$
943.3
$
289.7
$
23,701.1
(1)
Certain totals may not foot due to rounding.
(2)
Prior period amounts have been conformed to reflect the updated segment structure and allocation of corporate financing costs, enabling comparability with the current period presentation.
Non-GAAP Disclosures
To supplement consolidated and segment financial information prepared and presented in accordance with U.S. generally accepted accounting principles ("GAAP"), the Company also provides Earnings Available for Distribution (“EAD”), EAD Return on Equity ("EAD ROE"), Core Segments Earnings Available for Distribution (“Core Segments EAD”) and Core Segments EAD Return on Equity ("Core Segments EAD ROE") as non-GAAP measures.
Management believes these non-GAAP measures provide useful supplemental information to investors and management in evaluating the Company’s operating performance, facilitating comparisons to industry peers, and assessing the current income-generating capacity of the Company’s operating platforms as of the period presented, including the Company’s ability to pay dividends. These measures also assist in evaluating the Company’s ongoing transition to a more scalable and simplified business model, including the wind-down of legacy portfolio holdings within the Legacy Investments segment.
These non-GAAP measures should not be utilized in isolation, nor should they be considered as an alternative to GAAP net income (loss) available (related) to common stockholders, or other measurements of results of operations computed in accordance with GAAP or for federal income tax purposes.
Earnings Available for Distribution (“EAD”) and EAD ROE are non-GAAP financial measures that the Company has historically reported and continues to use to present management’s non-GAAP analysis of the operating performance of the Company’s different business segments. EAD is defined, as GAAP net income (loss) available (related) to common stockholders, adjusted to (i) exclude investment fair value changes, net; (ii) exclude realized gains and losses; (iii) exclude acquisition-related expenses; (iv) exclude certain organizational restructuring charges, as applicable; and (v) reflect a hypothetical income tax adjustment associated with these items. EAD ROE is defined as EAD divided by average common equity.
Core Segments EAD and Core Segments EAD ROE represent management’s non-GAAP assessment of the combined performance of the Company’s mortgage banking platforms and related investments, which include the Sequoia Mortgage Banking, CoreVest Mortgage Banking, and Redwood Investments segments (collectively, the “Core Segments”), together with an allocated portion of the Corporate segment attributable to those operations.
Core Segments EAD excludes the Legacy Investments segment and the portion of the Corporate segment attributable to Legacy Investments. Core Segments EAD ROE is calculated as Core Segments EAD divided by the average capital utilized by the Core Segments during the period, which represents management’s internal estimate of the average economic capital allocated to support Core Segments activities.
Reconciliation of GAAP to non-GAAP EAD – First Quarter 2026 (1)
Three Months Ended March 31, 2026
($ in millions)
Sequoia
Mortgage
Banking
Aspire
Mortgage
Banking
CoreVest
Mortgage
Banking
Redwood
Investments
Total
Core Segments (4)
Legacy
Investments
Corporate/
Other (3)
Total
GAAP Net Income (Loss)
$
37.8
$
2.3
$
(3.4
)
$
(8.0
)
$
28.7
$
(13.1
)
$
(22.9
)
$
(7.3
)
EAD Adjustments:
Investment fair value changes, net (5)
—
—
—
15.4
15.4
7.5
—
22.9
Realized (gains)/losses, net (6)
—
—
—
—
—
—
—
—
Acquisition related expenses (7)
—
—
2.0
—
2.0
—
—
2.0
Organizational restructuring charges (8)
—
—
5.0
2.1
7.1
—
0.3
7.4
Tax effect of adjustments (9)
—
—
(1.8
)
3.8
2.0
0.1
(0.1
)
1.9
Non-GAAP EAD (2)
$
37.8
$
2.3
$
1.8
$
13.3
$
55.2
$
(5.5
)
$
(22.7
)
$
27.1
Adjustment for allocation of Corporate segment (10)
(7.0
)
(2.6
)
(1.1
)
(8.0
)
(18.7
)
(3.9
)
22.7
—
Non-GAAP EAD with Allocated Corporate Segment
$
30.8
$
(0.3
)
$
0.7
$
5.3
$
36.5
$
(9.4
)
$
—
$
27.1
Net Income (loss) (GAAP)
$
(7.3
)
EAD (Non-GAAP)
$
27.1
Core Segments EAD (Non-GAAP)
$
36.5
Net Income (loss) per Basic Common Share (GAAP)
$
(0.07
)
EAD per Basic common share (Non-GAAP)
$
0.21
Core Segments EAD per Basic Common Share (Non-GAAP) (11)
$
0.28
Return on Equity ("ROE") (annualized) (12)
(3.1
)%
EAD ROE (Non-GAAP) (annualized)
11.5
%
Core Segments EAD Return on Equity (annualized) ("Core Segments EAD ROE") (Non-GAAP) (13)
19.1
%
Non-GAAP Disclosures (continued)
Reconciliation of GAAP to non-GAAP EAD – Fourth Quarter 2025 (1)
Three Months Ended December 31, 2025
($ in millions)
Sequoia
Mortgage
Banking
Aspire
Mortgage
Banking
CoreVest
Mortgage
Banking
Redwood
Investments
Total Core
Segments (4)
Legacy
Investments
Corporate/
Other (3)
Total
GAAP Net Income (Loss)
$
33.3
$
3.3
$
6.8
$
15.2
$
58.6
$
(22.9
)
$
(17.5
)
$
18.3
EAD Adjustments:
Investment fair value changes, net (5)
—
—
—
(7.6
)
(7.6
)
8.1
—
0.5
Realized (gains)/losses, net (6)
—
—
—
—
—
1.8
—
1.8
Acquisition related expenses (7)
—
—
2.0
—
2.0
—
—
2.0
Tax effect of adjustments (9)
—
—
(0.5
)
4.4
3.9
0.1
(0.1
)
3.8
Non-GAAP EAD (2)
$
33.3
$
3.3
$
8.3
$
12.0
$
56.9
$
(12.9
)
$
(17.6
)
$
26.4
Adjustment for allocation of Corporate segment (10)
(4.8
)
(1.9
)
(1.1
)
(5.8
)
(13.6
)
(4.0
)
17.6
—
Non-GAAP EAD with Allocated Corporate Segment
$
28.5
$
1.4
$
7.2
$
6.2
$
43.2
$
(16.9
)
$
—
$
26.4
Net Income (loss) (GAAP)
$
18.3
EAD (Non-GAAP)
$
26.4
Core Segments EAD (Non-GAAP)
$
43.2
Net Income (loss) per Basic Common Share (GAAP)
$
0.13
EAD per Basic common share (Non-GAAP)
$
0.20
Core Segments EAD per Basic Common Share (Non-GAAP) (11)
$
0.33
Return on Equity ("ROE") (annualized) (12)
7.7
%
EAD ROE (Non-GAAP) (annualized)
11.1
%
Core Segments EAD Return on Equity (annualized) ("Core Segments EAD ROE") (Non-GAAP) (13)
23.8
%
About Redwood
Redwood Trust, Inc. (NYSE: RWT) is a specialty finance company focused on several distinct areas of housing credit where we provide liquidity to growing segments of the U.S. housing market not well served by government programs. We deliver customized housing credit investments to a diverse mix of investors, through our best-in-class securitization platforms, whole-loan distribution activities, joint ventures and our publicly traded shares. We operate through three core residential housing-focused operating platforms — Sequoia, Aspire, and CoreVest — alongside our complementary Redwood Investments portfolio which is primarily composed of assets we source through these platforms. Redwood Investments also includes RWT Horizons®, our unified technology platform spanning internal AI innovation and strategic investments across the ecosystem, which supports our efforts to develop an AI-first operating model that enables compounding operational leverage and scalable growth. This reflects how we manage and organize our business and may differ from the manner in which our reportable segments are presented for financial reporting purposes.
Our goal is to provide attractive returns to shareholders through a stable and growing stream of earnings and dividends, capital appreciation, and a commitment to technological innovation that facilitates risk-minded scale. Redwood Trust is internally managed and structured as a real estate investment trust ("REIT") for tax purposes. For more information about Redwood, please visit our website at www.redwoodtrust.com or connect with us on LinkedIn.
Cautionary Statement; Forward-Looking Statements:
This press release and the related conference call contain forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including statements regarding the expected timing for the filing of Redwood's Quarterly Report on Form 10-Q. Forward-looking statements involve numerous risks and uncertainties. Redwood's actual results may differ from Redwood's beliefs, expectations, estimates, and projections and, consequently, you should not rely on these forward-looking statements as predictions of future events. Forward-looking statements are not historical in nature and can be identified by words such as “anticipate,” “estimate,” “will,” “should,” “expect,” “believe,” “intend,” “seek,” “plan” and similar expressions or their negative forms, or by references to strategy, plans, opportunities, or intentions. These forward-looking statements are subject to risks and uncertainties, including, among other things, those described in our Annual Report on Form 10-K for the year ended December 31, 2025 under the caption “Risk Factors”. Other risks, uncertainties, and factors that could cause actual results to differ materially from those projected may be described from time to time in reports we file with the Securities and Exchange Commission, including reports on Forms 10-K, 10-Q and 8-K. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.