First quarter financial results show sharp year-over-year gains
Finance of America Companies Inc. (FOA), the largest reverse mortgage lender in the US, reported $80 million in net income from continuing operations for the first quarter of 2025, equal to $3.17 in basic earnings per share.
Adjusted net income totaled $13 million, or $0.52 per share, and adjusted EBITDA was $29 million. Funded loan volume hit $561 million, exceeding the company’s guidance and marking a 32% increase from the first quarter of 2024. The rise in earnings, $20 million higher in adjusted net income compared to the same period last year, was attributed to the larger volume and reduced operating expenses.
By March 31, the company’s total equity stood at $395 million, while tangible equity grew by $88 million from year-end 2024.
“Finance of America delivered a strong start to 2025, funding $561 million in loans and exceeding the high end of our guidance range,” First American CEO Graham Fleming said in a press release. “Our first-quarter performance highlights the strength and growing relevance of reverse mortgages across a broad range of market conditions.”
FOA’ Retirement Solutions division, which generates revenue through net origination gains and fees from reverse mortgage originations, reported $3 million in pre-tax income and $9 million in adjusted net income for the quarter.
Revenue in this segment was up 13% year over year, mainly due to the increased funded volume. Compared to Q1 2024, pre-tax income rose 175%, and adjusted net income improved 80%. Expenses fell slightly to $48 million from $49 million as the company completed the integration of its retail platform and streamlined operations.
“Building on this momentum, we recently launched our new brand platform, ‘A Better Way with FOA,’ along with a national advertising campaign,” Fleming said. “We are optimistic that these initiatives will help us increase awareness and adoption of reverse mortgages by showcasing the meaningful benefits our products can deliver in a compelling and authentic way. We are very excited about the future growth of FOA.”
Read next: Are reverse mortgages set to take the market by storm in 2025?
Its portfolio management segment, which earns from net interest income and fair value changes on portfolio assets, posted $105 million in pre-tax income for the quarter. This was an improvement over both the prior quarter and Q1 2024, driven by positive fair value adjustments on retained interests in securitizations and higher accreted yield on residual interests.
Adjusted net income in this segment totaled $20 million, up $7 million from the previous quarter and $14 million from Q1 2024.
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