Finance of America Companies Inc.

Thank you for joining us today. These dynamics create a durable need for responsible home equity solutions and reinforce the long-term relevance of our platform. We believe Finance of America is well positioned to serve that need, given our specialized platform, broad product capabilities, and focus on helping homeowners thoughtfully incorporate home equity into their retirement planning. The macroeconomic and demographic need is clear. Kristen will now discuss how the investments we have made across distribution, technology, and proprietary products are strengthening our ability to capture that opportunity.

Thank you, Graham. And good afternoon, everyone. Last quarter, I said we were reaching an inflection point in the platform. The second quarter gives us greater confidence in that view. The investments we've made over the past two years across distribution, technology and product are beginning to compound. The results are stronger demand, a more productive operating model and a platform with increasing long term earnings power. First, demand is strengthening. Turning to slide eight, submissions exceeded $1 billion during the quarter, even in a rising rate environment, increasing approximately 11% sequentially and 19% year over year, while funded volume increased approximately 21% year over year to $730 million. Second, we're converting demand more efficiently. The clearest proof point shown on slide nine is retail, Retail opportunities increased 9%, submissions increased 19%, and funded loans increased 33%. Importantly, we achieved that growth with stable sales capacity, resulting in meaningful productivity improvements. Funded loans per call center loan officer increased nearly 30% from the first quarter. These results reflect structural improvements in how we engage customers, convert demand, and move borrowers through the origination process. Historically, growth depended more heavily on generating additional top of funnel opportunities. Now we're demonstrating our ability to generate more production from the pipeline we already have. Our proprietary technology platform and AI-enabled capabilities are also supporting these improvements, helping us better understand customer needs, match homeowners with appropriate solutions, and improve efficiency throughout the origination process. Our digital experience is showing similar progress. In June, approximately 10,000 site visitors engaged with our prequalification engine, achieving our year-end monthly target six months ahead of schedule. More importantly, monthly prequalification offers increased nearly 90% from the first quarter, and time to application improved approximately 57%. These metrics demonstrate that we're creating a larger pool of engaged borrowers while making it easier and faster for customers to move through the application process. our platform is becoming more valuable and scalable. Our proprietary products continue expanding the addressable market by providing customers greater flexibility and additional ways to access home equity. During the quarter, proprietary submissions increased approximately 20% and proprietary fundings increased approximately 25%. As shown on slide 10, our retail and wholesale channels continue to reinforce one another. Retail provides direct consumer engagement, and greater visibility into the customer journey while wholesale extends our reach through trusted partners and brings our proprietary solutions to more borrowers across more markets. Together, they create multiple avenues for profitable growth while leveraging the same product platform and operating infrastructure. Stepping back, three things stood out this quarter. Demand is strengthening, conversion is improving and our investments are compounding into a more scalable platform with durable earnings power. The market opportunity ahead of us is still large and underpenetrated, but the real story this quarter is conviction. We're building a stronger, more valuable business, not simply a bigger one. With that, I'll turn it over to Matt.

Thank you, Kristen, and good afternoon, everyone. As Graham mentioned, the second quarter demonstrated continued strength in the underlying business, while reported earnings reflected several market-driven and non-operating items. I will provide additional color on the quarter, which is summarized by segment on slide 11 and in today's earnings release. We recognized a GAAP net loss of $29 million for the quarter, while adjusted net income totaled $19 million, or 84 cents per share. The difference primarily reflects non-cash fair value adjustments on our portfolio, combined with certain one-time impacts during the quarter, which negatively impacted our GAAP results. We've recorded $84 million of negative fair value adjustments during the quarter. In addition to those impacting our portfolio related to higher interest rates, this also includes a $24 million adjustment related to our convertible notes as our stock price increased nearly $11 per share during the quarter. Because the convertible notes are carried at fair value indexed to our stock price, an increase in our stock price increases the value of the associated liability, creating a non-cash expense under GAAP. We also released our deferred tax asset valuation allowance, creating a tax benefit in the quarter of $42 million. This non-cash accounting adjustment reflects our expectation that future taxable income will support realization of these tax assets, and investors should expect a more normalized effective tax rate going forward. While these accounting adjustments can create meaningful quarter-to-quarter volatility in our gap earnings, they do not affect the underlying operating performance or cash generation of the business. We believe that adjusted net income continues to provide the clearest picture of the underlying earnings power of FOA. Adjusted earnings per share of 84 cents is a 53% improvement over the second quarter of 2025, and first half 2026 adjusted EPS of $1.94 improved 81% over the first half of 2025. Beginning with retirement solutions, continued demand as evidenced by the 21% increase in funded volume compared to the second quarter of 2025 allowed the business to contribute relatively stable adjusted earnings for the sequential quarter, even while we continued investing in the business with higher personnel and marketing expenses to support future production. For the first half of 2026, Retirement Solutions generated a 21% increase in adjusted net income on 14% higher funded volume compared to the first half of 25. And we believe these investments will continue to support higher production, stronger operating leverage, and increased earnings power over time. Portfolio management completed a securitization of over 1 billion during June, which contributed to FOA's strong cash flow from Originations and Capital Markets Activity for the quarter. For the first half of the year, the segment has recognized 46 million in adjusted net income, a 24% improvement over the first half of 2025. Based on our first half performance and continued momentum across submissions and funded production, we are reaffirming our full year guidance of funded volume between 2.8 and 3.1 billion and adjusted EPS between 450 and $5 per share. Turning to our balance sheet and cash flows, as shown in slide 12, cash generation from originations and capital markets activities remained strong at $58 million in the quarter and approximately $116 million for the first half of 2026. This enabled us to complete the entity portfolio acquisition, make the semi-annual interest payment on our non-funding corporate debt, and maintain strong quarter-end cash balances. As we have said before, strengthening the balance sheet remains foundational to unlocking the full value of the operating franchise we have built over the past several years. We are very pleased with the progress we have made. When we think about our balance sheet, we identify three key components, inventory loans, HECM MSR, and the residual fair value of our proprietary securitizations. The first category is inventory loans held at fair value that are yet to be sold or securitized. This is represented by loans held for investment and loans held for sale on our balance sheet. At the time of sale or securitization, we will recognize a cash premium, and depending on the securitization type, we'll record a HECM MSR or residual interest at fair value. These loans are financed via warehouse facilities, and we hold a small balance of haircut equity in them. When loans are securitized, in most cases, the assets will remain on our balance sheet with a corresponding liability in accordance with GAAP. For HECM loans, these are HMBS obligations, and for proprietary loans, these are non-recourse securitizations. For both categories, FOA recognizes an accreted yield on the adjusted net asset value we hold. Regarding the HECM MSR, the adjusted net asset value, or the delta between the loans held for investment subject to HMBS obligations and the corresponding HMBS obligations, totals $326 million. as of June 30th, with financing of only 46 million, or roughly 14% leverage. We continue to pursue increased financing secured by this asset at a more appropriate attachment point. With respect to our residuals and proprietary securitizations, we have the ability over time to monetize the equity held in these assets through the call and reissue of the non-recourse securitizations. Proceeds from the monetization of the HECM MSR and proprietary residuals provides financial flexibility to our business. Our first priority is retiring the remaining $150 million of senior secured notes this November, which will materially reduce our non-funding debt, lower our financing costs, and improve recurring earnings. Looking ahead, once that debt is retired, the company will have greater options for a broad range of potential actions, such as further due leveraging, stock repurchases, dividends, or business investment. Before wrapping up, I want to call your attention to an amendment effective July 31st to the reporting structure of our Class B shares. which establishes a one-to-one alignment of the reported Class B shares with the underlying LLC ownership. This amendment does not change economic ownership or voting power, but provides a clearer view of fully diluted shares and market capitalization. With that, I'll turn the call back to Graham.