Rithm Capital Corp. (NYSE: RITM), a global, multi-dimensional asset manager, reported strong results for the second quarter ended June 30, 2025. The company posted net income of $283.9 million, or $0.53 per diluted common share, representing a significant improvement compared to $36.5 million, or $0.07 per diluted common share, in the first quarter of 2025. These results underscore Rithm’s commitment to sustained performance and the ability of its diversified platform to deliver steady growth across its core operating businesses.

Financial Highlights: Rapid Earnings Growth and Stable Revenues

Rithm Capital Corp. showed significant growth in net income between quarters. The GAAP diluted net income per share of $0.53 in Q2 2025 represents a substantial improvement compared to $0.07 in Q1 2025. Earnings available for distribution (EAD), a non-GAAP financial measure, totaled $291.1 million, or $0.54 per diluted common share, compared to $275.3 million, or $0.52 per diluted common share, in Q1 2025. This is a 5.75% increase in EAD quarter-over-quarter.

The company declared a common dividend of $0.25 per common share, totaling $132.6 million, reflecting a consistent dividend policy unchanged from the previous quarter. Book value per common share stood at $12.71.

In terms of revenues, total revenues amounted to $1,217,039 thousand in Q2 2025, compared to $976,917 thousand in Q1 2025. This increase was primarily driven by significant changes in the fair value of mortgage servicing rights (MSRs) and diversification in revenues. Servicing fee revenue, net and interest income from MSRs and MSR financing receivables amounted to $574,817 thousand. Positive changes in the fair value of MSRs (net of economic hedges) totaled $(155,005) thousand, compared to $(333,378) thousand in the prior quarter, indicating a notable improvement in this area. Total interest income reached $478,455 thousand, an increase from the prior quarter.

Business Highlights: Growth Across Core Platforms

Rithm exhibited strong growth across all its key business segments. The Origination & Servicing segment, Rithm Capital’s multichannel mortgage origination and servicing platform, Newrez LLC, posted pre-tax income of $275.1 million in Q2 2025, excluding the MSR mark-to-market gain and related hedge impact of $29.9 million. This was up from $270.1 million in Q1 2025, excluding the MSR mark-to-market loss and related hedge impact of $(180.1) million. Newrez generated a 19% pre-tax return on equity (ROE) on $5.8 billion of equity. Total servicing unpaid principal balance (UPB) reached $864 billion, a 7% year-over-year increase, which included $271 billion UPB of third-party servicing, a 22% year-over-year increase. Origination funded production volume was $16.3 billion in Q2 2025, a 12% year-over-year increase.

In its Investment Portfolio, Rithm Capital completed a non-qualified mortgage securitization in the quarter totaling $504 million in UPB. The company invested $2.2 billion in residential mortgage assets in the quarter, including non-qualified residential mortgage loans, residential transition loans, and residential mortgage-backed securities.

Rithm Capital’s Residential Transitional Lending platform, Genesis Capital LLC, recorded pre-tax income of $26.9 million in Q2 2025, excluding a portfolio mark-to-market loss of $(1.8) million. Q2 2025 origination volume was $1.2 billion, a 49% year-over-year increase, and a record level for any quarter. Genesis Capital continued to expand its sponsor base, growing sponsors to 195, a 30% year-over-year increase.

In Asset Management, Rithm Capital’s alternative asset manager, Sculptor Capital Management Inc., grew to approximately $36 billion of assets under management (AUM) as of June 30, 2025, including gross fundraising inflows of $1.7 billion across the Sculptor platform during the quarter. Sculptor Capital also continued its active presence in the collateralized loan obligation (CLO) markets with $525 million of activity in Q2 2025. As previously announced, Sculptor Capital held the final closing for Sculptor’s Tactical Credit Fund on April 1, 2025, bringing total fund AUM to $900 million. Subsequent to the end of Q2 2025, Rithm Capital announced that it had entered into a strategic partnership with a large institutional investor to fund the acquisition of $500 million of residential transition loans, with the potential to upsize the partnership to $1.5 billion in fundings.

Risks and Future Considerations

Rithm Capital operates in a financial sector that involves inherent risks, as noted in its reports. These include the net interest margin on assets held within the investment portfolio; realized and unrealized gains or losses on assets held within the investment portfolio and operating companies, including any impairment or reserve for expected credit losses; income from the company’s operating company investments; and the company’s operating expenses and taxes. The company uses “earnings available for distribution” (EAD) as a non-GAAP financial measure to evaluate performance, which excludes certain highly volatile gains and losses. It is important to note that EAD is not a substitute for GAAP net income or cash flows from operating activities.

The company states that factors such as “changes in interest rates; effects on the U.S. economy resulting from the threat or implementation of new, or changes to, existing policies, regulations, regulatory and other governmental agencies and executive orders, including tariffs, immigration, DEI and ESG initiatives, consumer protection, foreign policy and tax regulations; disruptions to the global supply chain; our ability to successfully manage credit risk; business and economic conditions; the effects of recent developments and events in the financial services industry, including large-scale deposit withdrawals that resulted in bank failures; our ability to raise additional capital; and the occurrence of fraudulent activity, breaches or failures of our or our third-party vendors’ information security controls or cybersecurity-related incidents” are among those that could cause actual results to differ materially from forward-looking statements.

Summary: Rithm Capital Corp. – Diversified Business Model Driving Earnings Growth and Active Strategy

Rithm Capital Corp. presents a particularly strong second quarter in 2025, demonstrating impressive growth in net income and earnings available for distribution. Its success is driven by its diversified asset management platform, which includes mortgage origination and servicing, investment portfolios, residential transitional lending, and asset management segments. The company shows an ability to leverage its expertise in credit and real estate markets to generate significant returns, including through strategic acquisitions and partnerships. A consistent dividend policy, along with its achievements across all operational segments, positions Rithm Capital as an active company with potential for continued shareholder value creation. The information in this article is provided for professional review purposes only and does not constitute financial or investment advice.