Arbor Realty Trust reported fourth‑quarter and full‑year 2025 results on February 27, 2026. Net income fell 77% to $14.6 million, or $0.07 per diluted share, compared with $59.8 million, or $0.32 per diluted share, in the same quarter of 2024. Revenue rose 6.4% to $236 million, beating the consensus estimate of $221.71 million. Distributable earnings declined 74% to $41.2 million, or $0.19 per diluted share, versus $81.6 million, or $0.40 per diluted share, in Q4 2024. The company maintained its quarterly cash dividend at $0.30 per share, payable March 24, 2026 to shareholders of record March 10, 2026.
The revenue increase was driven by a 8% rise in agency servicing and a 7% rise in structured loan origination, offsetting headwinds in legacy loan segments. The 6.4% revenue beat of $14.29 million reflects stronger demand for the company’s core servicing platforms and a favorable mix shift toward higher‑margin structured products.
Net income fell sharply because of higher credit costs, impairments on real‑estate‑owned assets, and loss‑sharing provisions that weighed on profitability. These factors, combined with a modest decline in interest income, pushed GAAP earnings per share to $0.07, a miss of $0.07 against the consensus estimate of $0.14.
Distributable earnings also slipped, falling 74% to $0.19 per diluted share from $0.40 in Q4 2024. The payout ratio of 1.49 raises questions about the sustainability of the $0.30 dividend when earnings are under pressure, even as the company’s balance‑sheet improvements—new senior unsecured notes, debt repayment, and CLO unwinding—provide liquidity.
Investors reacted with mixed sentiment. While the revenue beat and dividend maintenance were viewed positively, the significant decline in both GAAP and distributable earnings, along with the high payout ratio, prompted caution among market participants.
No forward guidance was disclosed, leaving analysts to assess the company’s outlook based on current performance and the broader mortgage‑REIT environment, which remains affected by fixed‑income market volatility and credit‑cost pressures.
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