Take-Two CEO calls 'Grand Theft Auto VI' the 'most-anticipated entertainment property of all time'
"I believe affording Rockstar additional time for such a groundbreaking project is a worthy investment," Take-Two CEO Strauss Zelnick said.
Zelnick went so far as to call the crime-filled video game the "most anticipated entertainment property of all time."
Wall Street doesn't seem to be buying it, however.
Rockstar Games, which produces the "Grand Theft Auto" series, announced on May 2 that the game's release would be delayed until 2026. The announcement sent shares of Take-Two, Rockstar's parent company, tumbling by more than 8%.
Take-Two's stock dipped again on Thursday ahead of the company's earnings call. The company's forecast fell short of expectations, largely due to the delay of "GTA VI."
Zelnick said the "ambition and complexity" of "Grand Theft Auto 6" is greater than any other game Rockstar has created. "The team is poised to release another astonishing entertainment experience that will exceed players' expectations," he said.
Zelnick said the "Grand Theft Auto" series has been "the standard bearer, not just for our company, but for the industry, since it was launched."
"We, of course, do market research around here, and the market research that we've done is pretty astonishing," Zelnick said on the call. "But look, we're not in the business of claiming success until it happens. All we're focused on is making the best possible entertainment here. That's our job. The rest will take care of itself."
Despite the game's delay, Take-Two executives said they expected the company's year to be successful ultimately, pointing to other coming releases like "Borderlands 4" and "Mafia: The Old Country."
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Whirlpool Corporation Announces Second-Quarter Results
Delivered sequential net sales growth across all segments, despite negative consumer sentiment impacting global demand Delivered significant cost take out of 100 basis points or approximately $50 million, in-line with full year expectations Q2 GAAP net earnings margin of 1.7%; GAAP earnings per diluted share of $1.17 Q2 ongoing (non-GAAP) EBIT margin(1) of 5.3%; ongoing earnings per diluted share(2) of $1.34 Second-quarter results were unfavorably impacted by a non cash loss of $19 million, or $0.35 earnings per diluted share from Beko Europe B.V. equity in affiliates 2025 outlook is updated with full-year GAAP earnings per diluted share of approximately $5.00 to $7.00, and ongoing earnings per diluted share(2) of $6.00 to $8.00; cash provided by operating activities of approximately $850 million and free cash flow(3) of approximately $400 million Refinanced $1.2 billion of term loan debt at approximately 6.3% weighted average BENTON HARBOR, Mich., July 28, 2025 /PRNewswire/ -- Whirlpool Corporation (NYSE: WHR), today reported second-quarter financial results. "As expected, the second quarter continued to be impacted by competitors stockpiling Asian imports into the U.S. Despite this, we are well positioned in North America with a robust pipeline of new products, the industry's leading U.S. manufacturing footprint, and favorable housing demand fundamentals. We are confident in our long-term strategy and believe that evolving tariff policies will ultimately support domestic manufacturers." MARC BITZER, CHAIRMAN AND CHIEF EXECUTIVE OFFICER Second-Quarter Results 2025 2024 Change Net sales ($M) $3,773 $3,989 (5.4) % Net sales excluding currency ($M) $3,861 $3,989 (3.2) % GAAP net earnings available to Whirlpool ($M) $65 $219 (70.1) % Ongoing EBIT(1) ($M) $200 $212 (5.7) % GAAP net earnings margin 1.7 % 5.5 % (3.8pts) Ongoing EBIT margin(1) 5.3 % 5.3 % 0.0pts GAAP earnings per diluted share $1.17 $3.96 (70.5) % Ongoing earnings per diluted share(2) $1.34 $2.39 (43.9) %Free Cash Flow 2025 2024 Change Cash provided by (used in) operating activities ($M) $(702) $(485) $(217) Free cash flow(3) ($M) $(856) $(713) $(143) "In this uncertain environment, we are focused on what we can control: executing cost reduction, proactively managing debt maturities, and strengthening our balance sheet to ensure financial resilience." JIM PETERS, CHIEF FINANCIAL AND ADMINISTRATIVE OFFICER SEGMENT REVIEW SEGMENT INFORMATION ($M)Q2 2025 Q2 2024 YoY Change MDA North America Net Sales$2,446 $2,567 (4.7) % EBIT$144 $163 (11.7) % % of sales5.9 % 6.3 % (0.4pts) MDA Latin America Net Sales$806 $895 (10.0) % EBIT$48 $52 (7.7) % % of sales6.0 % 5.8 % 0.2pts MDA Asia Net Sales$320 $340 (5.9) % EBIT$23 $21 11.2 % % of sales7.1 % 6.2 % 0.9pts SDA Global Net Sales$201 $187 7.5 % EBIT$35 $26 32.9 % % of sales17.3 % 13.9 % 3.4pts MDA: Major Domestic Appliances; SDA: Small Domestic Appliances MDA NORTH AMERICA Excluding currency, net sales decreased 4.6% year-over-year as negative consumer sentiment impacted demand and product mix; promotional intensity remains elevated amid continued 'pre-loading' of Asian imports by foreign competitors ahead of tariffs EBIT margin(4) slightly declined year-over-year, driven by volume contraction partially offset by cost take out MDA LATIN AMERICA Excluding currency, net sales decreased 0.9% year-over-year, with implemented pricing actions offset by negative consumer demand in Mexico EBIT margin(4) expanded year-over-year, driven by favorable price/mix and cost takeout partially offset by negative impact of currency MDA ASIA Excluding currency, net sales decreased 3.7% year-over-year, driven by industry decline partially offset by sustained strong share gains EBIT margin(4) increased year-over-year, driven by continued cost take out SDA GLOBAL Excluding currency, net sales increased 6.8% year-over-year, driven by strong direct-to-consumer sales and new products despite an unfavorable industry in North America EBIT margin(4) increased year-over-year, driven by favorable price/mix supported by strong momentum from new products FULL-YEAR 2025 OUTLOOK Guidance Summary 2024 Reported 2024 Like-for- Like (5) 2025 Guidance Net sales ($B) $16.6 ~$15.8 ~$15.8 Cash provided by operating activities ($M) $835 N/A ~$850 Free cash flow ($M)(3) $385 N/A ~$400 GAAP net earnings margin (%) (1.9) % N/A ~2.2% Ongoing EBIT margin (%)(1) 5.3 % ~5.7% ~5.7% GAAP earnings per diluted share $(5.87) N/A $5.00 - $7.00 Ongoing earnings per diluted share(2) $12.21 N/A $6.00 - $8.00 GAAP tax rate (5.5) % N/A 20 - 25% Adjusted (non-GAAP) tax rate (28.6) % N/A 20 - 25% Expect full-year net sales of approximately $15.8 billion; approximately flat on a like-for-like(5) basis Expect to deliver approximately $200 million of structural cost take out actions Expect full-year GAAP earnings per diluted share of approximately $5.00 to $7.00 and full-year ongoing earnings per diluted share(2) of $6.00 to $8.00 Expect cash provided by operating activities of approximately $850 million and free cash flow(3) of approximately $400 million We will be recommending an annual dividend payout rate(6) of $3.60 per share, creating balance sheet capacity, the dividend is approved quarterly by the board of directors. (1) A reconciliation of earnings before interest and taxes (EBIT) and ongoing EBIT, non-GAAP financial measures, to reported net earnings (loss) available to Whirlpool, and a reconciliation of EBIT margin and ongoing EBIT margin, non-GAAP financial measures, to net earnings (loss) margin and other important information, appears below. (2) A reconciliation of ongoing earnings per diluted share, a non-GAAP financial measure, to reported net earnings (loss) per diluted share available to Whirlpool and other important information, appears below. (3) A reconciliation of free cash flow, a non-GAAP financial measure, to cash provided by (used in) operating activities and other important information, appears below. (4) Segment EBIT represents our consolidated EBIT broken down by the Company's reportable segments and are metrics used by the chief operating decision maker in accordance with ASC 280. Consolidated EBIT also includes corporate "Other/Eliminations" of $(60) million and $(150) million for the second quarters of 2025 and 2024, respectively. (5) Like-for-like refers to pro forma results for 2024, which exclude the first quarter results for the historical Europe major domestic appliances business (MDA Europe) to provide a comparative baseline for 2025 guidance. This comparison uses a prior period baseline that is aligned to the ongoing business expectations for 2025, with the Europe transaction closed April 1, 2024. The like-for-like GAAP net earnings margin and corresponding reconciliation cannot be provided without unreasonable effort or expense. Please see below for a reconciliation of ongoing EBIT for the full year to GAAP net earnings. (6) Note: Board of Directors reviews and sets dividend quarterly. Recommending quarterly dividend of $0.90 per share, totaling $5.30 per share for 2025 and annualized rate of $3.60. ABOUT WHIRLPOOL CORPORATION Whirlpool Corporation (NYSE: WHR) is a leading home appliance company, in constant pursuit of improving life at home. As the last-remaining major U.S.-based manufacturer of kitchen and laundry appliances, the company is driving meaningful innovation to meet the evolving needs of consumers through its iconic brand portfolio, including Whirlpool, KitchenAid, JennAir, Maytag, Amana, Brastemp, Consul, and InSinkErator. In 2024, the company reported approximately $17 billion in annual sales - close to 90% of which were in the Americas - 44,000 employees and 40 manufacturing and technology research centers. Additional information about the company can be found at WEBSITE DISCLOSURE We routinely post important information for investors on our website, in the "Investors" section. We also intend to update the "Hot Topics Q&A" portion of this webpage as a means of disclosing material, non-public information and for complying with our disclosure obligations under Regulation FD. Accordingly, investors should monitor the "Investors" section of our website, in addition to following our press releases, SEC filings, public conference calls, presentations and webcasts. The information contained on, or that may be accessed through, our webpage is not incorporated by reference into, and is not a part of, this document. WHIRLPOOL ADDITIONAL INFORMATION This document contains forward-looking statements about Whirlpool Corporation and its consolidated subsidiaries ("Whirlpool") within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Whirlpool intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 and includes this statement for purposes of complying with those safe harbor provisions. Any statements made in this press release that are not statements of historical fact, including statements regarding future financial results, long-term value creation goals, restructuring expectations, productivity, raw material prices and related costs, supply chain, portfolio transformation expectations, asset impairment, debt repayment and dividend expectations, India transaction timing and benefits expectations, trade customer inventory expectations, and the impact of housing recovery-related benefits on our operations are forward-looking statements and should be evaluated as such. Such statements can be identified by the use of terminology such as "may," "could," "will," "should," "possible," "plan," "predict," "forecast," "potential," "anticipate," "estimate," "expect," "project," "intend," "believe," "may impact," "on track," "margin lift," and similar words or expressions. Many risks, contingencies and uncertainties could cause actual results to differ materially from Whirlpool's forward-looking statements. Among these factors are: (1) intense competition in the home appliance industry, and the impact of the changing retail environment, including direct-to-consumer sales; (2) Whirlpool's ability to maintain or increase sales to significant trade customers; (3) Whirlpool's ability to maintain its reputation and brand image; (4) the ability of Whirlpool to achieve its business objectives and successfully manage its strategic portfolio transformation; (5) Whirlpool's ability to understand consumer preferences and successfully develop new products; (6) Whirlpool's ability to obtain and protect intellectual property rights; (7) acquisition, divestiture, and investment-related risks, including risks associated with our past acquisitions; (8) the ability of suppliers of critical parts, components and manufacturing equipment to deliver sufficient quantities to Whirlpool in a timely and cost-effective manner; (9) risks related to our international operations; (10) Whirlpool's ability to respond to unanticipated social, political and/or economic events, including epidemics/pandemics; (11) information technology system and cloud failures, data security breaches, data privacy compliance, network disruptions, and cybersecurity attacks; (12) product liability and product recall costs; (13) Whirlpool's ability to attract, develop and retain executives and other qualified employees; (14) the impact of labor relations; (15) fluctuations in the cost of key materials (including steel, resins, and base metals) and components and the ability of Whirlpool to offset cost increases; (16) Whirlpool's ability to manage foreign currency fluctuations; (17) impacts from goodwill, intangible asset and/or inventory impairment charges; (18) health care cost trends, regulatory changes and variations between results and estimates that could increase future funding obligations for pension and postretirement benefit plans; (19) impacts from credit rating agency downgrades; (20) litigation, tax, and legal compliance risk and costs; (21) the effects and costs of governmental investigations or related actions by third parties; (22) changes in the legal and regulatory environment including environmental, health and safety regulations, data privacy, taxes and generative AI; (23) the impacts of changes in foreign trade policies, including tariffs; (24) Whirlpool's ability to respond to the impact of climate change and climate change or other environmental regulation; and (25) the uncertain global economy and changes in economic conditions. In addition, factors that could cause actual results to differ materially from our India transaction expectations include, among other things, failure or delays in launching transaction based on Board approval, market conditions or other factors, failure or delays in share settlement and closing, transaction proceeds being lower than expected, alternative uses for proceeds received, brand license valuation expectations not being met, and strategic, economic or industry expectations for India not being realized. Additional information concerning these and other factors can be found in Whirlpool's filings with the Securities and Exchange Commission, including the most recent annual report on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K. These cautionary statements should not be construed by you to be exhaustive and the forward-looking statements are made only as of the date of this press release. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law. WHIRLPOOL CORPORATION CONSOLIDATED CONDENSED STATEMENTS OF INCOME (LOSS) (UNAUDITED) FOR THE PERIODS ENDED JUNE 30 (Millions of dollars, except per share data) Three Months EndedSix Months Ended2025202420252024 Net sales $ 3,773$ 3,989$ 7,393$ 8,478 ExpensesCost of products sold 3,1623,3636,1767,211 Gross margin 6106261,2171,267 Selling, general and administrative 397394803871 Intangible amortization 771317 Restructuring costs 2501173 Loss (gain) on sale and disposal of businesses —45—292 Operating profit 20413038914 Other (income) expenseInterest and sundry (income) expense (4)7(36)(21) Interest expense 8693164183 Earnings (loss) before income taxes 12130260(148) Income tax expense (benefit) 29(206)72(130) Equity method investment income (loss), net of tax (18)(11)(35)(11) Net earnings (loss) 75225153(29) Less: Net earnings (loss) available to noncontrolling interests 961711 Net earnings (loss) available to Whirlpool $ 65$ 219$ 137$ (40) Per share of common stockBasic net earnings (loss) available to Whirlpool $ 1.17$ 3.96$ 2.46$ (0.75) Diluted net earnings (loss) available to Whirlpool $ 1.17$ 3.96$ 2.45$ (0.75) Dividends declared $ 1.75$ 1.75$ 3.50$ 3.50 Weighted-average shares outstanding (in millions)Basic 55.954.955.754.9 Diluted 56.155.055.954.9 WHIRLPOOL CORPORATION CONSOLIDATED CONDENSED BALANCE SHEETS (Millions of dollars, except share data) June 30, 2025December 31, 2024(Unaudited) AssetsCurrent assetsCash and cash equivalents $ 1,068$ 1,275 Accounts receivable, net of allowance of $51 and $46, respectively 1,3791,317 Inventories 2,6002,035 Prepaid and other current assets 581612 Total current assets 5,6275,239 Property, net of accumulated depreciation of $5,585 and $5,414, respectively 2,3002,275 Right of use assets 826841 Goodwill 3,3253,322 Other intangibles, net of accumulated amortization of $459 and $447, respectively 2,7052,717 Deferred income taxes 1,4861,433 Other noncurrent assets 489474 Total assets $ 16,759$ 16,301 Liabilities and stockholders' equityCurrent liabilitiesAccounts payable $ 3,520$ 3,530 Accrued expenses 409455 Accrued advertising and promotions 411682 Employee compensation 211228 Notes payable 1,15818 Current maturities of long-term debt 3001,850 Other current liabilities 631560 Total current liabilities 6,6417,323 Noncurrent liabilitiesLong-term debt 6,1724,758 Pension benefits 111122 Postretirement benefits 9696 Lease liabilities 692711 Other noncurrent liabilities 464358 Total noncurrent liabilities 7,5356,045 Stockholders' equityCommon stock, $1 par value, 250 million shares authorized, 65 million and65 million shares issued, respectively, and 55 million and 55 million shares outstanding, respectively 6564 Additional paid-in capital 3,4733,462 Retained earnings 1,2531,311 Accumulated other comprehensive loss (1,904)(1,545) Treasury stock, 9 million and 9 million shares, respectively (568)(609) Total Whirlpool stockholders' equity 2,3202,683 Noncontrolling interests 264250 Total stockholders' equity 2,5832,933 Total liabilities and stockholders' equity $ 16,759$ 16,301 WHIRLPOOL CORPORATION CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED) FOR THE PERIODS ENDED JUNE 30 (Millions of dollars) Six Months Ended20252024 Operating activitiesNet earnings (loss) $ 153$ (29) Adjustments to reconcile net earnings to cash provided by (used in) operating activities:Depreciation and amortization 163170 Loss (gain) on sale and disposal of businesses —292 Equity method investment (income) loss, net of tax 3511 Share based compensation and other 8633 Changes in assets and liabilities:Accounts receivable (21)(211) Inventories (527)(54) Accounts payable (134)(123) Accrued advertising and promotions (284)(154) Accrued expenses and current liabilities (29)(170) Taxes deferred and payable, net (16)(209) Accrued pension and postretirement benefits (1)(14) Employee compensation (31)(55) Other (96)28 Cash provided by (used in) operating activities (702)(485) Investing activitiesCapital expenditures (154)(228) Proceeds from sale of assets and businesses —42 Cash held by divested businesses —(245) Other —(1) Cash provided by (used in) investing activities (154)(432) Financing activitiesNet proceeds from borrowings of long-term debt 1,200300 Net repayments of long-term debt (1,550)(801) Net proceeds (repayments) from short-term borrowings 1,142780 Dividends paid (194)(191) Repurchase of common stock —(50) Sale of minority interest in subsidiary —462 Other (15)1 Cash provided by (used in) financing activities 582501 Effect of exchange rate changes on cash and cash equivalents 67(72) Increase (decrease) in cash and cash equivalents (207)(488) Cash and cash equivalents at beginning of year 1,2751,667 Cash and cash equivalents at end of period $ 1,068$ 1,179 SUPPLEMENTAL INFORMATION - CONSOLIDATED FINANCIAL STATEMENTS RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES(Millions of dollars except per share data) (Unaudited) We supplement the reporting of our financial information determined under U.S. generally accepted accounting principles (GAAP) with certain non-GAAP financial measures, some of which we refer to as "ongoing" measures. These measures may include earnings before interest and taxes (EBIT), EBIT margin, ongoing EBIT, ongoing EBIT margin, ongoing earnings per diluted share, adjusted effective tax rate, net debt leverage (Net Debt/Ongoing EBITDA), return on invested capital (ROIC) and free cash flow. Ongoing measures exclude items that may not be indicative of, or are unrelated to, results from our ongoing operations and provide a better baseline for analyzing trends in our underlying businesses. Sales excluding foreign currency: Current period net sales translated in functional currency, to U.S. dollars using the applicable prior period's exchange rate compared to the applicable prior period net sales. Management believes that sales excluding foreign currency provides stockholders with a clearer basis to assess our results over time, excluding the impact of exchange rate EBIT margin: Ongoing earnings before interest and taxes divided by net sales. Ongoing measures exclude items that may not be indicative of, or are unrelated to, results from our ongoing operations and provide a better baseline for analyzing trends in our underlying earnings per diluted share: Diluted net earnings per share from continuing operations, adjusted to exclude items that may not be indicative of, or are unrelated to, results from our ongoing operations. Ongoing measures provide a better baseline for analyzing trends in our underlying debt leverage: Net debt to ongoing earnings before interest, taxes, depreciation, and amortization (EBITDA) ratio is net debt outstanding, including long-term debt, current maturities of long-term debt, and notes payable, less cash and cash equivalents, divided by ongoing EBITDA. Management believes that net debt leverage provides stockholders with a view of our ability to generate earnings sufficient to service our on invested capital: Ongoing EBIT after taxes divided by total invested capital, defined as total assets less non-interest bearing current liabilities (NIBCLS). NIBCLS is defined as current liabilities less current maturities of long-term debt and notes payable. This ROIC definition may differ from other companies' methods and therefore may not be comparable to those used by other companies. Management believes that ROIC provides stockholders with a view of capital efficiency, a key driver of stockholder value effective tax rate: Effective tax rate, excluding pre-tax income and tax effect of certain unique items. Management believes that adjusted tax rate provides stockholders with a meaningful, consistent comparison of the Company's effective tax rate, excluding the pre-tax income and tax effect of certain unique cash flow: Cash provided by (used in) operating activities less capital expenditures. Management believes that free cash flow provides stockholders with a relevant measure of liquidity and a useful basis for assessing the Company's ability to fund its activities and obligations. Whirlpool does not provide a non-GAAP reconciliation for its forward-looking long-term value creation goals, such as EBIT, free cash flow conversion, ROIC and net debt leverage, as these long-term management goals are not annual guidance, and the reconciliation of these long-term measures would rely on market factors and certain other conditions and assumptions that are outside of the Company's control. We believe that these non-GAAP measures provide meaningful information to assist investors and stockholders in understanding our financial results and assessing our prospects for future performance, and reflect an additional way of viewing aspects of our operations that, when viewed with our GAAP financial measures, provide a more complete understanding of our business. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies' non-GAAP financial measures having the same or similar names. These ongoing financial measures should not be considered in isolation or as a substitute for reported net earnings available to Whirlpool per diluted share, net earnings, net earnings available to Whirlpool, net earnings margin, return on assets, net sales, effective tax rate and cash provided by (used in) operating activities, the most directly comparable GAAP financial measures. We also disclose segment EBIT as an important financial metric used by the Company's Chief Operating Decision Maker to evaluate performance and allocate resources in accordance with ASC 280 - Segment Reporting. GAAP net earnings available to Whirlpool per basic or diluted share (as applicable) and ongoing earnings per diluted share are presented net of tax, while individual adjustments in each reconciliation are presented on a pre-tax basis; the income tax impact line item aggregates the tax impact for these adjustments. The tax impact of individual line item adjustments may not foot precisely to the aggregate income tax impact amount, as each line item adjustment may include non-taxable components. Historical quarterly earnings per share amounts are presented based on a normalized tax rate adjustment to reconcile quarterly tax rates to full-year tax rate expectations. We strongly encourage investors and stockholders to review our financial statements and publicly-filed reports in their entirety and not to rely on any single financial measure. SECOND-QUARTER 2025 ONGOING EARNINGS BEFORE INTEREST AND TAXES AND ONGOING EARNINGS PER DILUTED SHARE The reconciliation provided below reconciles the non-GAAP financial measures ongoing earnings before interest and taxes and ongoing earnings per diluted share, with the most directly comparable GAAP financial measures, net earnings (loss) available to Whirlpool and net earnings (loss) per diluted share available to Whirlpool, for the three months ended June 30, 2025. Net earnings (loss) margin is calculated by dividing net earnings (loss) available to Whirlpool by net sales. Ongoing EBIT margin is calculated by dividing ongoing EBIT by net sales. EBIT margin is calculated by dividing EBIT by net sales. The earnings per diluted share GAAP measure and ongoing measure are presented net of tax, while each adjustment is presented on a pre-tax basis. Our second-quarter GAAP tax rate was 23.9%. The aggregate income tax impact of the taxable components of each adjustment is presented in the income tax impact line item at our second-quarter adjusted tax rate (non-GAAP) of 22.5%.Three Months Ended Earnings Before Interest & Taxes Reconciliation: June 30, 2025 Net earnings (loss) available to Whirlpool $ 65 Net earnings (loss) available to noncontrolling interests 9 Income tax expense (benefit) 29 Interest expense 86 Earnings before interest & taxes $ 190 Net sales $ 3,773 Net earnings (loss) margin 1.7 % Results classificationEarnings beforeinterest & taxesEarnings perdiluted share Reported measure $ 190$ 1.17 Restructuring expense (a) Restructuring costs20.03 Impact of M&A transactions (b) Selling, general and administrative80.15 Income tax impact (0.04) Normalized tax rate adjustment (c) 0.03 Ongoing measure $ 200$ 1.34 Net sales $ 3,773 Ongoing EBIT margin 5.3 %Note: Numbers may not reconcile due to rounding. SECOND-QUARTER 2024 ONGOING EARNINGS BEFORE INTEREST AND TAXES AND ONGOING EARNINGS PER DILUTED SHARE The reconciliation provided below reconciles the non-GAAP financial measures ongoing earnings before interest and taxes and ongoing earnings per diluted share, with the most directly comparable GAAP financial measures, net earnings (loss) available to Whirlpool and net earnings (loss) per diluted share available to Whirlpool, for the three months ended June 30, 2024. Net earnings (loss) margin is calculated by dividing net earnings (loss) available to Whirlpool by net sales. Ongoing EBIT margin is calculated by dividing ongoing EBIT by net sales. EBIT margin is calculated by dividing EBIT by net sales. The earnings per diluted share GAAP measure and ongoing measure are presented net of tax, while each adjustment is presented on a pre-tax basis. Our second-quarter GAAP tax rate was (687)%. The aggregate income tax impact of the taxable components of each adjustment is presented in the income tax impact line item at our second-quarter adjusted tax rate (non-GAAP) of (14)%.Three Months Ended Earnings Before Interest & Taxes Reconciliation: June 30, 2024 Net earnings (loss) available to Whirlpool $ 219 Net earnings (loss) available to noncontrolling interests 6 Income tax expense (benefit) (206) Interest expense 93 Earnings before interest & taxes $ 112 Net sales $ 3,989 Net earnings (loss) margin 5.5 % Results classificationEarnings before interest & taxesEarnings per diluted share Reported measure $ 112$ 3.96 Restructuring expense(a) Restructuring expense500.91 Impact of M&A transactions(b) (Gain) loss on sale and disposal of businesses & Selling, general and administrative500.90 Total income tax impact 0.26 Normalized tax rate adjustment(c) (3.64) Ongoing measure $ 212$ 2.39 Net sales $ 3,989 Ongoing EBIT margin 5.3 %Note: Numbers may not reconcile due to rounding. FULL-YEAR 2024 ONGOING EARNINGS BEFORE INTEREST AND TAXES AND ONGOING EARNINGS PER DILUTED SHARE The reconciliation provided below reconciles the non-GAAP financial measures ongoing earnings before interest and taxes and ongoing earnings per diluted share, with the most directly comparable GAAP financial measures, net earnings (loss) available to Whirlpool and net earnings (loss) per diluted share available to Whirlpool, for the twelve months ended December 31, 2024. Net earnings (loss) margin is calculated by dividing net earnings (loss) available to Whirlpool by net sales. Ongoing EBIT margin is calculated by dividing ongoing EBIT by net sales. EBIT margin is calculated by dividing EBIT by net sales. The earnings per diluted share GAAP measure and ongoing measure are presented net of tax, while each adjustment is presented on a pre-tax basis. Our full-year GAAP tax rate was (5.5)%. The aggregate income tax impact of the taxable components of each adjustment is presented in the income tax impact line item at our full-year adjusted tax (non-GAAP) rate of (28.6)%.Twelve Months Ended Earnings Before Interest & Taxes Reconciliation: December 31, 2024 Net earnings (loss) available to Whirlpool $ (323) Net earnings (loss) available to noncontrolling interests 18 Income tax expense (benefit) 10 Interest expense 358 Earnings before interest & taxes $ 63 Net sales $ 16,607 Net earnings (loss) margin (1.9) % Results classificationEarnings beforeinterest & taxesEarnings per diluted share Reported measure $ 63$ (5.87) Restructuring expense Restructuring costs791.44 Impairment of goodwill,intangibles and other assets Impairment of goodwill and other intangibles3816.92 Impact of M&A transactions (Gain) loss on sale anddisposal of businesses & Selling, general and administrative2925.30 Legacy EMEA legal matters Interest and sundry (income) expense(2)(0.04) Equity method investee - restructuring charges Equity method investmentincome (loss), net of tax741.34 Total income tax impact 4.28 Normalized tax rate adjustment (1.16) Ongoing measure $ 887$ 12.21 Net Sales $ 16,607 Ongoing EBIT Margin 5.3 %Note: Numbers may not reconcile due to rounding. FULL-YEAR 2025 OUTLOOK FOR ONGOING EARNINGS BEFORE INTEREST AND TAXES AND ONGOING EARNINGS PER DILUTED SHARE The reconciliation provided below reconciles the non-GAAP financial measures ongoing earnings before interest and taxes and ongoing earnings per diluted share, with the most directly comparable GAAP financial measures, net earnings available to Whirlpool and net earnings per diluted share available to Whirlpool, for the twelve months ending December 31, 2025. The earnings per diluted share GAAP measure and ongoing measure are presented net of tax, while each adjustment is presented on a pre-tax basis. Our anticipated full-year GAAP tax rate is approximately 20 - 25%. The aggregate income tax impact of the taxable components of each adjustment is presented in the income tax impact line item at our anticipated full-year adjusted tax (non-GAAP) rate of 20 - 25%.Twelve Months Ending December 31, 2025Results classificationEarnings before interest & taxes*Earnings per diluted share Reported measure ~$825$5.00 - $7.00 Restructuring Expense Restructuring Costs ~50 ~1.00 Impact of M&A transactions (Gain) loss on sale and disposal of businesses &Selling, general and administrative ~20 ~0.25 Total income tax impact (~0.25) Ongoing measure ~$900$6.00 - $8.00Note: Numbers may not reconcile due to rounding.*Earnings Before Interest & Taxes (EBIT) is a non-GAAP measure. The Company does not provide a forward-looking quantitative reconciliation of EBIT to the most directly comparable GAAP financial measure, net earnings available to Whirlpool, because the net earnings available to noncontrolling interests item of such reconciliation -- which has historically represented a relatively insignificant amount of the Company's overall net earnings -- implicates the Company's projections regarding the earnings of the Company's non wholly-owned subsidiaries and joint ventures that cannot be quantified precisely or without unreasonable efforts. FOOTNOTES a. RESTRUCTURING EXPENSE - We incurred restructuring charges of $2 million for the three months ended June 30, 2025 compared to $50 million for the same period in 2024. b. IMPACT OF M&A TRANSACTIONS - The Company incurred unique transaction related costs related to portfolio transformation for a total of $8 million for the three months ended June 30, January 16, 2023, we signed a contribution agreement to contribute our European major domestic appliance business into a newly formed entity with Arçelik. In connection with the transaction, we recorded a loss on disposal of $45 million for the three months ended June 30, 2024. Additionally, we incurred other unique transaction related costs related to portfolio transformation for a total of $5 million for the three months ended June 30, 2024. These transaction costs were recorded in Selling, General and Administrative expenses on our Consolidated Condensed Statements of Comprehensive Income (Loss). c. NORMALIZED TAX RATE ADJUSTMENT - During the second quarter of 2025, the Company calculated a GAAP tax rate of 23.9%. Ongoing earnings per share was calculated using an adjusted tax rate of 22.5%, which excludes the tax impacts related to M&A transaction costs and restructuring the second quarter of 2024, the Company calculated a GAAP tax rate of (687)%. Ongoing earnings per share was calculated using an adjusted tax rate of (14)%, which excludes the non-tax deductible impact of M&A transactions of approximately $50 million recorded in the second quarter of in the full-year 2025 outlook, the Company calculated ongoing earnings per share using a full-year adjusted tax (non-GAAP) rate of approximately 20 - 25%. NET SALES AND ONGOING EBIT EXCLUDING MDA EUROPE 2024 FIRST QUARTER The reconciliation provided below reconciles the impact of removing Q1 MDA Europe from our net sales and ongoing EBIT for the twelve months ended December 31, 2024 for the Whirlpool business. Please see elsewhere in this Supplemental Information section for a reconciliation of Ongoing EBIT to GAAP reported net earnings (loss) available to Whirlpool.2024 AsReported Q1 2024 MDA Europe* 2024 Like-for-Like Net Sales (in billions) $16.6 $0.8 ~$15.8 Ongoing EBIT (in millions) 887 (9) ~896 Ongoing EBIT Margin 5.3 % (1.1) % ~5.7 %Note: Numbers may not reconcile due to rounding. *Q1 historical segment financial data (unaudited). FREE CASH FLOW Free cash flow is cash provided by (used in) operating activities after capital expenditures. The reconciliation provided below reconciles six months ended June 30, 2025 and 2024 and 2025 full-year free cash flow with cash provided by (used in) operating activities, the most directly comparable GAAP financial measure. Free cash flow as a percentage of net sales is calculated by dividing free cash flow by net Months EndedJune 30, (millions of dollars) 202520242025 Outlook Cash provided by (used in) operating activities $(702)$(485)~$850 Capital expenditures (154)(228)(~450) Free cash flow $(856)$(713)~$400 Cash provided by (used in) investing activities* (154)(432) Cash provided by (used in) financing activities* 582501*Financial guidance on a GAAP basis for cash provided by (used in) financing activities and cash provided by (used in) investing activities has not been provided because in order to prepare any such estimate or projection, the Company would need to rely on market factors and certain other conditions and assumptions that are outside of its control. View original content to download multimedia: SOURCE Whirlpool Corporation Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Business Wire
16 hours ago
- Business Wire
TWO Reports Second Quarter 2025 Financial Results
NEW YORK--(BUSINESS WIRE)--TWO (Two Harbors Investment Corp., NYSE: TWO), an MSR-focused real estate investment trust (REIT), today announced its financial results for the quarter ended June 30, 2025. 'Given the strength of our platform and the depth of expertise across our team, we are confident in our ability to navigate through changing market cycles, creating long-term value for our stockholders, customers, and business partners.' Share Quarterly Summary Reported book value of $12.14 per common share, and declared a second quarter common stock dividend of $0.39 per share, representing a (14.5)% quarterly economic return on book value. For the first six months of 2025, generated a (10.3)% total economic return on book value. (1) Incurred a Comprehensive Loss of $(221.8) million, or $(2.13) per weighted average basic common share. Recorded a contingency liability and related expense of $199.9 million, or $1.92 per weighted average basic common share, related to the company's ongoing litigation with PRCM Advisers LLC. (2) Excluding the loss contingency accrual recognized during the quarter: Generated a (1.4)% quarterly economic return on book value. For the first six months of 2025, generated a 2.9% total economic return on book value. (1) Incurred a Comprehensive Loss of $(21.9) million, or $(0.21) per weighted average basic common share. Issued $115.0 million aggregate principal amount of 9.375% Senior Notes due 2030 through an underwritten offering for net proceeds of $110.8 million. Settled $6.6 billion in unpaid principal balance (UPB) of MSR through two bulk purchases, flow-sale acquisitions and recapture. As of June 30, 2025, MSR portfolio had a weighted average gross coupon rate of 3.53% and a 60+ day delinquency rate of 0.82%, compared to 0.85% as of March 31, 2025. For the second quarter of 2025, MSR portfolio experienced a 3-month CPR of 5.8%, compared to 5.3% for the second quarter of 2024. Funded $48.6 million UPB in first lien loans and brokered $44.0 million UPB in second lien loans. 'The combination of our investment portfolio and operating company allows us to be dynamic and responsive as opportunities emerge across the mortgage finance space,' said Bill Greenberg, TWO's President and Chief Executive Officer. 'Given the strength of our platform and the depth of expertise across our team, we are confident in our ability to navigate through changing market cycles, creating long-term value for our stockholders, customers, and business partners.' ________________ (1) Economic return on book value is defined as the increase (decrease) in common book value from the beginning to the end of the given period, plus dividends declared to common stockholders in the period, divided by common book value as of the beginning of the period. (2) The contingency liability is reflective of the $139.8 million termination fee that the Company believes would have been payable to PRCM Advisers for termination on the basis of unfair compensation pursuant to Section 13(a)(ii) of the Management Agreement, plus applicable pre-judgment interest on such amount accrued at the statutory rate of 9% through June 30, 2025. Estimated loss contingencies are required to be recorded under ASC 450, Contingencies, when a company determines a contingency liability is both probable and estimable. Expand 'Fixed-income and equity markets proved resilient in the second quarter,' stated Nick Letica, TWO's Chief Investment Officer. 'While we will continue to be mindful of the many sources of volatility that can impact our portfolio, we believe there is also opportunity in this environment. Spreads for Agency RMBS remain historically wide, and offer good relative value to other high quality spread assets. Our core strategy of low coupon MSR paired with Agency RMBS is well positioned to benefit from both stable prepayments and wide Agency RMBS spreads.' Operating Performance The following table summarizes the company's GAAP and non-GAAP earnings measurements and key metrics for the second quarter of 2025 and first quarter of 2025: _______________ (1) Earnings Available for Distribution, or EAD, is a non-GAAP measure. Please see page 11 for a definition of EAD and a reconciliation of GAAP to non-GAAP financial information. (2) Dividend yield is calculated based on annualizing the dividends declared in the given period, divided by the closing share price as of the end of the period. (3) Economic return on book value is defined as the increase (decrease) in common book value from the beginning to the end of the given period, plus dividends declared to common stockholders in the period, divided by the common book value as of the beginning of the period. (4) Excludes non-cash equity compensation expense of $1.9 million for the second quarter of 2025 and $6.5 million for the first quarter of 2025 and certain operating expenses of $2.8 million for the second quarter of 2025 and $0.1 million for the first quarter of 2025. Certain operating expenses predominantly consists of expenses incurred in connection with the company's ongoing litigation with PRCM Advisers LLC. Expand Portfolio Summary As of June 30, 2025, the company's portfolio was comprised of $11.4 billion of Agency RMBS, MSR and other investment securities as well as their associated notional debt hedges. Additionally, the company held $3.0 billion bond equivalent value of net long to-be-announced securities (TBAs). The following tables summarize the company's investment portfolio as of June 30, 2025 and March 31, 2025: ________________ (1) Based on the prior month-end's principal balance of the loans underlying the company's MSR, increased for current month purchases. (2) Represents bond equivalent value of TBA position. Bond equivalent value is defined as notional amount multiplied by market price. Accounted for as derivative instruments in accordance with GAAP. Expand ______________ (1) Weighted average cost basis includes Agency principal and interest RMBS only and utilizes carrying value for weighting purposes. Expand Portfolio Metrics Specific to MSR (1) As of June 30, 2025 As of March 31, 2025 (dollars in thousands) (unaudited) (unaudited) Unpaid principal balance $ 198,822,611 $ 196,773,345 Gross coupon rate 3.5 % 3.5 % Current loan size $ 330 $ 330 Original FICO (2) 760 760 Original LTV 73 % 72 % 60+ day delinquencies 0.8 % 0.8 % Net servicing fee 25.4 basis points 25.3 basis points Three Months Ended June 30, 2025 Three Months Ended March 31, 2025 (unaudited) (unaudited) Fair value losses $ (35,902 ) $ (36,221 ) Servicing income $ 147,961 $ 146,870 Servicing costs $ 2,322 $ 3,302 Change in servicing reserves $ 64 $ (105 ) Expand ________________ (1) Metrics exclude residential mortgage loans in securitization trusts for which the company is the named servicing administrator. Portfolio metrics, other than UPB, represent averages weighted by UPB. (2) FICO represents a mortgage industry accepted credit score of a borrower. Expand ________________ (1) Accounted for as derivative instruments in accordance with GAAP. Expand Financing Summary The following tables summarize the company's financing metrics and outstanding repurchase agreements, revolving credit facilities, warehouse lines of credit, senior notes and convertible senior notes as of June 30, 2025 and March 31, 2025: June 30, 2025 Balance Weighted Average Borrowing Rate Weighted Average Months to Maturity Number of Distinct Counterparties (dollars in thousands, unaudited) Repurchase agreements collateralized by securities $ 7,992,622 4.48 % 1.96 18 Repurchase agreements collateralized by MSR 790,000 7.39 % 10.54 3 Total repurchase agreements 8,782,622 4.74 % 2.73 19 Revolving credit facilities collateralized by MSR and related servicing advance obligations 1,011,871 7.36 % 19.96 3 Warehouse lines of credit collateralized by mortgage loans 9,275 6.31 % 2.47 1 Unsecured senior notes 110,867 9.38 % 61.55 n/a Unsecured convertible senior notes 260,944 6.25 % 6.54 n/a Total borrowings $ 10,175,579 Expand March 31, 2025 Balance Weighted Average Borrowing Rate Weighted Average Months to Maturity Number of Distinct Counterparties (dollars in thousands, unaudited) Repurchase agreements collateralized by securities $ 8,970,830 4.50 % 2.23 18 Repurchase agreements collateralized by MSR 770,000 7.38 % 13.88 3 Total repurchase agreements 9,740,830 4.73 % 3.16 19 Revolving credit facilities collateralized by MSR and related servicing advance obligations 933,171 7.45 % 15.91 3 Warehouse lines of credit collateralized by mortgage loans 7,971 6.36 % 2.50 1 Unsecured senior notes — — % — n/a Unsecured convertible senior notes 260,591 6.25 % 9.53 n/a Total borrowings $ 10,942,563 Expand Borrowings by Collateral Type As of June 30, 2025 As of March 31, 2025 (dollars in thousands) (unaudited) (unaudited) Agency RMBS $ 7,992,427 $ 8,970,635 Mortgage servicing rights and related servicing advance obligations 1,801,871 1,703,171 Other - secured 9,470 8,166 Other - unsecured (1) 371,811 260,591 Total 10,175,579 10,942,563 TBA cost basis 3,009,819 3,001,672 Net payable (receivable) for unsettled RMBS 108,474 (643,896 ) Total, including TBAs and net payable (receivable) for unsettled RMBS $ 13,293,872 $ 13,300,339 Debt-to-equity ratio at period-end (2) 5.4 :1.0 5.1 :1.0 Economic debt-to-equity ratio at period-end (3) 7.0 :1.0 6.2 :1.0 Cost of Financing by Collateral Type (4) Three Months Ended June 30, 2025 Three Months Ended March 31, 2025 (unaudited) (unaudited) Agency RMBS 4.54 % 4.62 % Mortgage servicing rights and related servicing advance obligations (5) 7.87 % 7.81 % Other - secured 6.68 % 6.93 % Other - unsecured (1)(5) 7.44 % 6.84 % Annualized cost of financing 5.18 % 5.27 % Interest rate swaps (6) (0.20 )% (0.18 )% U.S. Treasury futures (7) (0.10 )% (0.04 )% TBAs (8) 2.65 % 2.89 % Annualized cost of financing, including swaps, U.S. Treasury futures and TBAs 4.43 % 4.49 % Expand ____________________ (1) Unsecured borrowings under senior notes and convertible senior notes. (2) Defined as total borrowings to fund Agency and non-Agency investment securities, MSR and related servicing advances and mortgage loans held-for-sale, divided by total equity. (3) Defined as total borrowings to fund Agency and non-Agency investment securities, MSR and related servicing advances and mortgage loans held-for-sale, plus the implied debt on net TBA cost basis and net payable (receivable) for unsettled RMBS, divided by total equity. (4) Excludes any repurchase agreements collateralized by U.S. Treasuries. (5) Includes amortization of debt issuance costs. (6) The cost of financing on interest rate swaps held to mitigate interest rate risk associated with the company's outstanding borrowings includes interest spread income/expense and amortization of upfront payments made or received upon entering into interest rate swap agreements and is calculated using average borrowings balance as the denominator. (7) The cost of financing on U.S. Treasury futures held to mitigate interest rate risk associated with the company's outstanding borrowings is calculated using average borrowings balance as the denominator. U.S. Treasury futures income is the economic equivalent to holding and financing a relevant cheapest-to-deliver U.S. Treasury note or bond using short-term repurchase agreements. (8) The implied financing benefit/cost of dollar roll income on TBAs is calculated using the average cost basis of TBAs as the denominator. TBA dollar roll income is the non-GAAP economic equivalent to holding and financing Agency RMBS using short-term repurchase agreements. TBAs are accounted for as derivative instruments in accordance with GAAP. Expand Conference Call TWO will host a conference call on July 29, 2025 at 9:00 a.m. ET to discuss its second quarter 2025 financial results and related information. To participate in the teleconference, please call toll-free (888) 394-8218 approximately 10 minutes prior to the above start time and provide the Conference Code 3889089. The conference call will also be webcast live and accessible online in the News & Events section of the company's website at For those unable to attend, a replay of the webcast will be available on the company's website approximately four hours after the live call ends. About TWO Two Harbors Investment Corp., or TWO, a Maryland corporation, is a real estate investment trust that invests in mortgage servicing rights, residential mortgage-backed securities, and other financial assets. TWO is headquartered in St. Louis Park, MN. Forward-Looking Statements This release includes 'forward-looking statements' within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Actual results may differ from expectations, estimates and projections and, consequently, readers should not rely on these forward-looking statements as predictions of future events. Words such as 'expect,' 'target,' 'assume,' 'estimate,' 'project,' 'budget,' 'forecast,' 'anticipate,' 'intend,' 'plan,' 'may,' 'will,' 'could,' 'should,' 'believe,' 'predicts,' 'potential,' 'continue,' and similar expressions are intended to identify such forward-looking statements. These forward-looking statements involve significant risks and uncertainties that could cause actual results to differ materially from expected results, including, among other things, those described in our Annual Report on Form 10-K for the year ended December 31, 2024, and any subsequent Quarterly Reports on Form 10-Q, under the caption 'Risk Factors.' Factors that could cause actual results to differ include, but are not limited to: the state of credit markets and general economic conditions; changes in interest rates and the market value of our assets; changes in prepayment rates of mortgages underlying our target assets; the rates of default or decreased recovery on the mortgages underlying our target assets; declines in home prices; our ability to establish, adjust and maintain appropriate hedges for the risks in our portfolio; the availability and cost of our target assets; the availability and cost of financing; changes in the competitive landscape within our industry; our ability to effectively execute and to realize the benefits of strategic transactions and initiatives we have pursued or may in the future pursue; our decision to terminate our management agreement with PRCM Advisers LLC and the ongoing litigation related to such termination; our ability to manage various operational risks and costs associated with our business, including the risks associated with operating a mortgage loan servicer and originator; interruptions in or impairments to our communications and information technology systems; our ability to acquire MSR and to maintain our MSR portfolio; our exposure to legal and regulatory claims; legislative and regulatory actions affecting our business; our ability to maintain our REIT qualification; and limitations imposed on our business due to our REIT status and our exempt status under the Investment Company Act of 1940. Readers are cautioned not to place undue reliance upon any forward-looking statements, which speak only as of the date made. TWO does not undertake or accept any obligation to release publicly any updates or revisions to any forward-looking statement to reflect any change in its expectations or any change in events, conditions or circumstances on which any such statement is based. Additional information concerning these and other risk factors is contained in TWO's most recent filings with the Securities and Exchange Commission (SEC). All subsequent written and oral forward-looking statements concerning TWO or matters attributable to TWO or any person acting on its behalf are expressly qualified in their entirety by the cautionary statements above. Non-GAAP Financial Measures In addition to disclosing financial results calculated in accordance with United States generally accepted accounting principles (GAAP), this press release and the accompanying investor presentation present non-GAAP financial measures, such as earnings available for distribution and related per basic common share measures. The non-GAAP financial measures presented by the company provide supplemental information to assist investors in analyzing the company's results of operations and help facilitate comparisons to industry peers. However, because these measures are not calculated in accordance with GAAP, they should not be considered a substitute for, or superior to, the financial measures calculated in accordance with GAAP. The company's GAAP financial results and the reconciliations from these results should be carefully evaluated. See the GAAP to non-GAAP reconciliation table on page 11 of this release. Additional Information Stockholders of TWO and other interested persons may find additional information regarding the company at at the Securities and Exchange Commission's internet site at or by directing requests to: TWO, Attn: Investor Relations, 1601 Utica Avenue South, Suite 900, St. Louis Park, MN, 55416, (612) 453-4100. TWO HARBORS INVESTMENT CORP. (dollars in thousands, except share data) Certain prior period amounts have been reclassified to conform to the current period presentation Three Months Ended Six Months Ended June 30, June 30, 2025 2024 2025 2024 (unaudited) (unaudited) Net interest expense: Interest income $ 117,082 $ 115,953 $ 228,464 $ 233,736 Interest expense 135,205 154,207 266,919 314,207 Net interest expense (18,123 ) (38,254 ) (38,455 ) (80,471 ) Net servicing income: Servicing income 158,354 176,015 315,213 342,348 Servicing costs 2,386 4,475 5,583 11,594 Net servicing income 155,968 171,540 309,630 330,754 Other (loss) income: Loss on investment securities (32,830 ) (22,437 ) (65,559 ) (33,412 ) Loss on servicing asset (35,902 ) (22,857 ) (72,123 ) (11,845 ) (Loss) gain on interest rate swap and swaption agreements (52,950 ) 22,012 (151,738 ) 120,522 (Loss) gain on other derivative instruments (31,257 ) (750 ) (29,809 ) 46,849 Gain (loss) on mortgage loans held-for-sale 883 — 1,552 (3 ) Other income 1,038 226 1,799 226 Total other (loss) income (151,018 ) (23,806 ) (315,878 ) 122,337 Expenses: Compensation and benefits 21,469 21,244 48,058 47,773 Other operating expenses 21,307 17,699 41,812 38,751 Loss contingency accrual 199,935 — 199,935 — Total expenses 242,711 38,943 289,805 86,524 (Loss) income before income taxes (255,884 ) 70,537 (334,508 ) 286,096 Provision for income taxes 1,661 14,201 2,092 26,172 Net (loss) income (257,545 ) 56,336 (336,600 ) 259,924 Dividends on preferred stock (13,239 ) (11,784 ) (26,425 ) (23,568 ) Gain on repurchase and retirement of preferred stock — — — 644 Net (loss) income attributable to common stockholders $ (270,784 ) $ 44,552 $ (363,025 ) $ 237,000 Basic (loss) earnings per weighted average common share $ (2.62 ) $ 0.43 $ (3.51 ) $ 2.27 Diluted (loss) earnings per weighted average common share $ (2.62 ) $ 0.43 $ (3.51 ) $ 2.16 Comprehensive (loss) income: Net (loss) income $ (259,041 ) $ 56,336 $ (338,096 ) $ 259,924 Other comprehensive income (loss): Unrealized gain (loss) on available-for-sale securities 50,473 (44,073 ) 207,645 (147,151 ) Other comprehensive income (loss) 50,473 (44,073 ) 207,645 (147,151 ) Comprehensive (loss) income (208,568 ) 12,263 (130,451 ) 112,773 Dividends on preferred stock (13,239 ) (11,784 ) (26,425 ) (23,568 ) Gain on repurchase and retirement of preferred stock — — — 644 Comprehensive (loss) income attributable to common stockholders $ (221,807 ) $ 479 $ (156,876 ) $ 89,849 Expand TWO HARBORS INVESTMENT CORP. (dollars in thousands, except share data) Three Months Ended Six Months Ended June 30, June 30, 2025 2024 2025 2024 (unaudited) (unaudited) Interest income: Available-for-sale securities $ 108,842 $ 99,211 $ 209,260 $ 199,816 Mortgage loans held-for-sale 145 3 198 4 Other 8,095 16,739 19,006 33,916 Total interest income 117,082 115,953 228,464 233,736 Interest expense: Repurchase agreements 110,288 113,714 217,366 232,430 Revolving credit facilities 20,343 29,906 40,469 60,153 Warehouse lines of credit 129 — 184 — Term notes payable — 6,008 — 12,426 Senior notes 1,496 — 1,496 — Convertible senior notes 4,445 4,579 8,900 9,198 Total interest expense 136,701 154,207 268,415 314,207 Net interest expense $ (19,619 ) $ (38,254 ) $ (39,951 ) $ (80,471 ) Expand TWO HARBORS INVESTMENT CORP. (dollars in thousands, except share data) Certain prior period amounts have been reclassified to conform to the current period presentation Three Months Ended June 30, 2025 March 31, 2025 (unaudited) (unaudited) Reconciliation of comprehensive (loss) income to Earnings Available for Distribution: Comprehensive (loss) income attributable to common stockholders $ (221,807 ) $ 64,931 Adjustment for other comprehensive income attributable to common stockholders: Unrealized gain on available-for-sale securities (50,473 ) (157,172 ) Net loss attributable to common stockholders $ (272,280 ) $ (92,241 ) Adjustments to exclude reported realized and unrealized (gains) losses: Realized loss on securities 32,599 33,661 Unrealized loss (gain) on securities 347 (1,026 ) (Reversal of) provision for credit losses (116 ) 94 Realized and unrealized loss on mortgage servicing rights 35,902 36,221 Realized loss (gain) on termination or expiration of interest rate swaps and swaptions 30,298 (26,587 ) Unrealized loss on interest rate swaps and swaptions 29,034 131,350 Realized and unrealized loss (gain) on other derivative instruments 32,606 (1,329 ) Other adjustments: MSR amortization (1) (73,983 ) (70,303 ) TBA dollar roll income (losses) (2) 6,181 8,178 U.S. Treasury futures income (3) 3,358 1,272 Change in servicing reserves 64 (105 ) Non-cash equity compensation expense 1,932 6,523 Certain operating expenses (4) 2,754 106 Loss contingency accrual 199,935 — Net provision for (benefit from) income taxes on non-EAD 914 (722 ) Earnings available for distribution to common stockholders (5) $ 29,545 $ 25,092 Weighted average basic common shares 104,084,326 103,976,437 Expand _____________ (1) MSR amortization refers to the portion of change in fair value of MSR primarily attributed to the realization of expected cash flows (runoff) of the portfolio, which is deemed a non-GAAP measure due to the company's decision to account for MSR at fair value. (2) TBA dollar roll income is the economic equivalent to holding and financing Agency RMBS using short-term repurchase agreements. (3) U.S. Treasury futures income is the economic equivalent to holding and financing a relevant cheapest-to-deliver U.S. Treasury note or bond using short-term repurchase agreements. (4) Certain operating expenses predominantly consists of expenses incurred in connection with the company's ongoing litigation with PRCM Advisers LLC. (5) EAD is a non-GAAP measure that we define as comprehensive (loss) income attributable to common stockholders, excluding realized and unrealized gains and losses on the aggregate investment portfolio, gains and losses on repurchases of preferred stock, provision for (reversal of) credit losses, reserve expense for representation and warranty obligations on MSR, non-cash compensation expense related to restricted common stock, certain operating expenses and loss contingency accrual. As defined, EAD includes net interest income, accrual and settlement of interest on derivatives, dollar roll income on TBAs, U.S. Treasury futures income, servicing income, net of estimated amortization on MSR and certain cash related operating expenses. EAD provides supplemental information to assist investors in analyzing the company's results of operations and helps facilitate comparisons to industry peers. EAD is one of several measures our board of directors considers to determine the amount of dividends to declare on our common stock and should not be considered an indication of our taxable income or as a proxy for the amount of dividends we may declare. Expand
CNBC
a day ago
- CNBC
Here are Monday's biggest analyst calls: Apple, Tesla, Amazon, Nike, Microsoft, Walmart & more
Here are the biggest calls on Wall Street on Monday: JPMorgan upgrades Mara to overweight from neutral JPMorgan says it sees upside for the bitcoin miner. "We are upgrading MARA to OW (from Neutral), as shares do not reflect the company's revised YE25 hashrate target, even after considering capex requirements." Morgan Stanley reiterates Amazon as overweight Morgan Stanley says Amazon is a beneficiary of the Big Beautiful bill passed by Congress. "We see AMZN capturing ~$15bn/year in tax benefits. While most will be re-invested in AWS, even investing 50% of the annual cash flow benefit paints a much faster path to billions of annual automation savings." Wells Fargo initiates Take-Two Interactive as overweight Wells says it's bullish on the release of Grand Theft Auto in 2026 for Take-Two . "We anticipate GTA 6 sells 50M units in FY27, the first year post-launch, at an $80 base game retail ASP [average selling price]." BMO initiates MongoDB as outperform BMO says it likes the cloud database company's valuation. "We are launching on MongoDB with an Outperform rating and a $280 target price." Bank of America reiterates Apple as buy Bank of America says all "eyes [are] on margins" ahead of Apple earnings later this week. "As we head into F3Q25 (June qtr) earnings aftermarket on Thur July 31, we see client sentiment as fairly negative given uncertain impact from tariffs, U.S. DOJ investigation (Google TAC payments), App Store headwinds, and slow progress in AI." Mizuho downgrades GE Vernova to neutral from outperform The firm increased its price target but downgraded GE Vernova on valuation. "We increase our PT to $670, up 63%, due to accelerating EBITDA margins in power and electrification business and higher gas power manufacturing capacity beyond 2028" Morgan Stanley upgrades Hesai to overweight from equal weight Morgan Stanley says it's bullish on shares of the autonomous driving company. "We expect robotaxis and smart home robotic appliances to serve as Hesai's second revenue growth driver from 2026 onwards." Bernstein upgrades Charter to outperform from market perform Bernstein says investors should buy the dip in the cable giant. "For CHTR, it's the secular challenges that seem to stretch further with each earnings call, and this one certainly didn't help. But as we reflect in the summer heat on what's shaping up to be a tough 2H, we are looking ahead to CHTR's narrative for '26. July is nearly behind us, and this unusual heat, too, will pass." Read more. Deutsche Bank reiterates Tesla as buy Deutsche says more "patience" is needed for Tesla's robotaxi service but that it's sticking with the stock. " Tesla's robotaxi service is currently still very small scale, having accumulated only +7k miles since the launch on June 22nd with 10-20 vehicles in the fleet. Management did not provide a lot of clarity regarding the pace of expansion although Elon Musk indicated the goal of technically being able to cover half the US population by year-end." Oppenheimer initiates Wave Life Sciences as outperform Oppenheimer says shares of the biotech company have plenty room to run. "We initiate Wave Life Sciences (WVE) with an Outperform rating and a $24 price target." Canaccord initiates Gold Fields as buy Canaccord says the gold company is well positioned. " Gold Fields (GFI) is one of the top 10 gold producers globally with 10 operations and is headquartered in South Africa." Morgan Stanley reiterates Walmart as overweight Morgan Stanley says Walmart is a "clear leader" in retail AI. "AI use cases in Food Retail are accelerating, driving stronger sales growth and greater efficiencies. WMT a clear leader." Evercore ISI downgrades Cisco to in line from outperform Evercore downgraded the stock mainly on valuation. "We are downgrading Cisco to In Line as the stock is within 6% of our price target of $72. The stock has performed well recently with a +46% move over the last twelve months vs. +17% for the S & P." Bank of America reinstates Surgery Partners as buy The firm moved to buy from no rating on the outpatient surgery company and says the stock is being unfairly punished. "We change our rating on SRGY to Buy from No Rating as we no longer believe that the stock is trading on deal speculation (on 6/17, SGRY rejected the buyout offer from Bain Capital)." Wolfe upgrades Texas Instruments to outperform from neutral Wolfe says it likes the company's multi-year CapEx Plan. "We're upgrading TXN from Peer Perform to Outperform and setting a $230 price target." JPMorgan upgrades Nike to overweight from equal weight The firm says the turnaround is underway at Nike. "NKE is the global athletic market leader with diversification across product categories, geographies, and distribution, and we see the model at an inflection for revenue growth to re-accelerate into 2H26/FY27 following several quarters of franchise product lifecycle management & inventory liquidation headwinds." Read more. Benchmark initiates Lionsgate Studios as buy The firm says it's bullish on shares of the movie studio company. "We are initiating coverage of Lionsgate Studios with a BUY rating and an $8.50 eighteen-month price target." Stifel reiterates Microsoft as buy Stifel raised its price target on Microsoft to $550 per share from $500 ahead of earnings later this week. "Looking forward, we believe management's prior expectation that supply/demand imbalances would linger beyond June will be further pushed out to F2H26, and we also expect FY26 capex commentary could likely exceed our./street estimates of ~$110B/$100B, respectively, echoing Alphabet's commentary during earnings." JPMorgan downgrades American Eagle to underweight from neutral The firm says the lifestyle retailer is is showing signs of a "promotional overhang." "Conversely, we downgrade AEO to Underweight - modeling 2Q SSS/EPS more/less in-line with guidance/Street flagging our 3Q25 EPS 12% below Consensus on elevated advertising investments Y/Y and potential promotional 'overhang' post 1H merchandising mis-execution with our FY26 EPS 15% below the Street." Read more. Argus upgrades Las Vegas Sands to buy from neutral Argus says it's like Las Vegas Sands capital investments. "We expect the shares to rally now that the company has completed its capital investment programs."
