Mr Cooper Group Inc

Latest Results (04.01.2026):

Mr. Cooper Group Inc.'s second quarter 2025 results show a solid, recurring performance: net income of $198 million, operating ROTCE of 17.2% (within the 16–20% guidance), servicing pretax income of $332 million (up 15% YoY) and originations pretax income of $64 million on $9.4 billion of fundings. The balance sheet is strong with a tangible net worth to assets ratio of 26.6% and $3.8 billion of liquidity; MSR valuation drivers were positive this quarter and delinquencies declined to 1.0%. Management reiterated disciplined capital and integration planning amid the pending Rocket combination.

Key financials

Net income: $198M. Pretax operating income: $269M. Operating ROTCE: 17.2% (up from 16.8% last quarter). MSR mark-up of $59M; hedge losses of $29M. Adjustments totaled ~$15M and intangible amortization was $7M.

Servicing performance

Servicing pretax income: $332M, +15% YoY. Revenues +13% YoY vs. operating expenses +6% YoY, reflecting strong operating leverage on a servicing portfolio near $1.5T (post‑Flagstar).

Originations & home equity

Originations pretax income: $64M on $9.4B fundings. DTC volumes rose ~40% sequentially; home equity and cash‑out refinances ~60% of mix. Completed two home equity securitizations and see a large home equity opportunity (customers have ~$900B in available equity).

Capital, liquidity & capital allocation

Tangible net worth to assets: 26.6% (up from 24.4% at year‑end). Liquidity: $3.8B. Stock repurchases remain paused due to the pending Rocket merger; management notes ROTCE would be higher if capital were normalized.

Asset quality

MSR delinquencies declined to 1.0%. FHA exposure limited to ~15% of MSR portfolio; management is monitoring student‑loan related delinquencies (16% of customers have student loans; student loan delinquency peaked at 8.7% in April, 7.9% in June).

Strategic initiatives & efficiency

Launched maiden MSR Fund with $200M initial commitments. Emphasis on AI (AgentiQ rollout and future agentic features) to drive efficiency — company reports cost‑to‑serve nearly 50% below the industry average per MBA benchmarks.

Guidance & near‑term outlook

Management expects continued consistent performance in Q3 2025. Corporate expenses forecasted at ~$48M next quarter due to ongoing IT and servicing platform investments; plan to board ~$20B in MSR acquisitions in Q3 and a new ~40B subservicing client by year‑end.