Armour Residential REIT (NYSE: ARR) reported a GAAP net loss of $58.0 million for the first quarter of 2026, translating to a basic earnings per share of –$0.49. The company’s distributable earnings per share reached $0.76, comfortably covering its regular monthly dividend of $0.24 per share. Total revenue for the quarter was $249.2 million, with adjusted revenue—defined as net interest income—of $70.7 million.
The distributable EPS beat the consensus estimate of $0.73 by $0.03, a 4.1% lift, while adjusted revenue surpassed the $54.0 million estimate by $16.7 million, a 30.9% beat. The GAAP loss, however, reflected higher interest and financing costs, one‑time losses on agency securities, and a decline in spread income, underscoring the challenges faced by mortgage‑backed‑security‑heavy REITs amid volatile markets.
Armour’s Q1 2026 results represent a sharp reversal from the prior year’s performance. In Q4 2025 the company posted a GAAP net income of $208.7 million, illustrating the magnitude of the current quarter’s loss and the volatility of its earnings profile.
"Notwithstanding the market turbulence and MBS volatility due to geopolitical events experienced in the latter portion of the first quarter of the year the Company delivered solid results for the first quarter of 2026, with total economic return of (2.6)%," said CEO Scott Ulm. He added, "Our approach remains to grow and deploy capital thoughtfully during spread dislocations, maintain robust liquidity, and dynamically adjust hedges for disciplined risk management." Ulm also emphasized, "We continue to prioritize maintaining common share dividends appropriate for the intermediate term rather than focusing on short‑term market fluctuations. We are confident in our positioning, strategy, and ability to deliver value for shareholders."
Armour maintains a high leverage profile, with a debt‑to‑equity ratio of 7.90:1 and an implied leverage of 8.21:1, yet it reports $1.1 billion in liquidity. The portfolio is heavily concentrated in agency mortgage‑backed securities (92.5%), exposing the company to MBS market volatility. Despite the GAAP loss, the company’s ability to generate distributable earnings and sustain its dividend demonstrates a liquidity‑first strategy that seeks to protect shareholder returns amid headwinds.
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