Rithm Capital Corp.

To withdraw your question, press star 1 again. I will now hand the conference over to Emma Holke, Deputy General Counsel. Emma, please go ahead.

Thank you and good morning, everyone. I would like to thank you for joining us today for Rhythm Capital's third quarter 2026 earnings call. Joining me today are Michael Nierenberg, Chairman, CEO, and President of Rhythm Capital, Nic Santoro, Chief Financial Officer of Rhythm Capital, Varun Silverstein, President of New Res, and Peter Brindley, Head of Real Estate at EloCorp Properties. Throughout the call, we are going to reference the earnings supplement that was posted this morning to the Rhythm Capital website, www.rhythmcap.com. If you've not already done so, I'd encourage you to download the presentation now. I would like to point out that certain statements made today will be forward-looking statements. These statements, by their nature, are uncertain and may differ materially from actual results. I encourage you to review the disclaimers in our press release and earnings supplement regarding forward-looking statements and to review the risk factors contained in our annual and quarterly reports filed with the SEC. In addition, we will be discussing some non-GAAP financial measures during today's call. Reconciliations of these measures to the most directly comparable GAAP measures can be found in our earnings supplement. With that, I will turn the call over to Michael.

Thanks, Emma. Good morning, everyone. Thanks for joining our call this morning. This quarter, we demonstrated the power of the platform and the risk discipline we bring to our investors and partners despite a very challenging environment. If you take a step back and look at the quarter, all indices related to markets we invest in were wider, interest rates rose significantly, geopolitical concerns persist, oil rose, and we still had a great quarter. Our operating business lines, New Res, Genesis, perform really well. Scale matters in those businesses and with our MSR business at approximately 880 billion of MSRs at New Res and Genesis clicking on all cylinders, we sit in a very good position in the marketplace. AI initiatives and expense management will help us drive higher earnings in the future and I firmly believe AI will change the archaic nature of the mortgage industry. Our real estate business in Rhythm and our asset management business should be a very good growth area for us going forward. Our Alicor investment, which was formerly known as Paramount, where we took the company private and invested in New York City and San Francisco offices, is an area we're very excited about. We are seeing significant leasing activity, growing rents, and brought in a partner on 1301 6th Avenue. As with most assets, entry point matters. and buying off 75% discount to replacement value should reward our shareholders well. The scope to real estate business is world-class and with an amazing track record. They continue to see more inflows into all of their differentiated strategies as well as their recent fundraise, which was approximately $5.5 billion. Our asset management business is seeing real inflows. We are launching new funds and did a first close on our new ABF funds. We now have multiple funds in the marketplace including partnerships with the large banks on the distribution side. Investing in our clients, people, and products is essential to our success. I will say when we set out to launch our asset management business in 2022 upon our separation from Fortress, we were running around the globe making connections and developing relationships with investors everywhere. Today we stand at 60 plus billion, a third party AUM. We have well north of 200 different partners and LPs, and I feel like we've just begun. Our mantra of performance first and making sure we have the expertise in the products we offer our clients is the backbone of our business. We need to differentiate ourselves from others, and we will. I've never been more excited about the trajectory of our firm and the collaboration that is happening. Really exciting times for us and our partners. This quarter, We changed our presentation a bit, and we speak a little bit to the Rhythm journey and where we're going. Please have a look. I'll now refer to the presentation that's been posted online, and I will begin on page three. So when you look at Rhythm today, it's roughly $110 billion of investable assets. That includes both the balance sheet and third-party assets that we manage on behalf of others. When you look to the left side of the page, New Res is the third largest mortgage servicer in the United States. I pointed out earlier that we have approximately $880 billion in mortgage servicing rights, and we originate roughly $60 billion in mortgages. There's something there. We don't need to originate a mortgage to make money. If the economics are there, we'll do it. If not, the business performs extremely well and makes a lot of money. Genesis, the number two... residential transition lender in the country, doing a lot more today in both RTLs as well as in multifamily, and we serve well north of 700 sponsors. Elicor Properties, as I mentioned before, was the company we took private. That was formerly known as Paramount. And Peter Brindley, who's with me here today, who runs real estate there, will speak to that in a minute. When you look to the right side of the page, our AUM north of $60 billion, I pointed out, you know, when we first started this journey in 22 to raise money from third parties, we were running around everywhere. And now we have well north of $60 billion of a real AUM, multiple funds in the marketplace, a great brand, and most importantly, great teams that manage the money on behalf of our partners in the marketplace. When you look across this north of 30 years of performance across all of our different strategies, The other thing that I think will differentiate us as we go forward in the future is we do invest our own capital along folks that invest in our funds. When you look at the quarter on page four, very strong quarter, third quarter EAD of 55 cents per diluted share, 28 consecutive quarters where our EAD was greater than dividends paid, cumulative dividends paid just a little bit south of $7 billion at $6.8 billion dollars. Earnings available for distribution in the quarter, again, $315 million. Gap net income, $217 million, so 38 cents per diluted share. When you look at book value for the quarter, $7 billion. We're actually a little bit higher quarter over quarter. A lot of that's due to, honestly, our hedging activities as well as our MSR business, which in a higher rate environment is going to perform extremely well. are common stock dividend 11.2%, 25 cents per diluted share, and cash and liquidity, we ended the quarter at $1.9 billion. Page five, if you look at the rhythm story, and then certain slides I'll take you through, but I'll take you through real quick on this one. We started this company in 2013 to take advantage of opportunistic investing in, at that time, mortgage servicing rights because the banks needed to sell them due to Basel III capital rules, as it related to the amount of capital that they needed to hold on balance sheet. Over the years, we focused on broadening our internal capabilities through acquisitions while working with our private equity business at Fortress which owned at that time Mr. Cooper and we also had built one main financial at that time. In 2018, when it was clear that we were going to sell these portfolio companies because they sat in our private equity business, we decided to build our own. So we acquired a company called New Penn Financial and that was the beginning of New Res. Today, again, New Res is one of the top mortgage companies in the United States. 2022, we buy back the management contract from Fortress and we rebrand the company as Rhythm Capital. It was formerly known as New Residential. Over the years, we said, okay, let's go broaden our asset management business. 2023, we buy Sculptor. 2025 we buy Crestline and again we take Paramount Private in 2025 as well. So that's really the beginning as far as how we got to the place that we did on the asset management side. When you look at our origination businesses at both New Res and at Genesis, it truly differentiates our product offerings in the ABF space. We not only have the ability to underwrite a borrower, we have the ability to service that borrower and whether those underlying loans go into funds or whether they sit on balance sheets, it is a factor that will differentiate us from others in the marketplace because we don't have to just go out and bid in competition against everybody else to buy a certain asset class. And as I pointed out before, we have north of 200 institutional investors globally and well north of $61 billion in AUM. So where are we going? where we're going on a forward basis. Our origination businesses will continue to be the core of our earnings at the public company level. We're going to continue to try to scale our asset management business, which we're really excited about. As asset management earnings scale, we have the potential to optimize our corporate structure and actually have that as its own segment, but we need to continue to grow our so-called FRE or fee-related earnings in order to do that. When you look at page six, The quarter in review. Asset management, I pointed out, we're starting to see real momentum in some of the new funds we have in the marketplace. During the quarter, we raised $569 million of new capital, and we're starting to see real commitment as we look to the fourth quarter for fund inflows. Year-to-date gross inflows are a little bit south of $3 billion. Crestline held their final close on a European Capital Solutions Fund and bringing total commitments there to $625 million. And again, we continue to see healthy inflows into our business post the end of the quarter. When we look at our core areas, Elecor expanded its third-party capital base to a JV with a strategic partner for 1301 6th Avenue, while also signing 320,000 square feet of new leases in the quarter. Genesis originated $1.5 billion in RTL originations in the quarter, bringing year-to-date originations of $5 billion and exceeding all of what we did in 2025. and also New Res originated, when you look from a year-to-date perspective, $5.1 billion of non-agency loans, mostly in the non-QM space. It's a new record for New Res in the product class. I bring that up as I pointed out in my opening remarks. We don't need to originate a loan to be competitive with someone else for the sake of doing it. This is an area where we're using our origination business, we use our funds business, We use our balance sheet to originate products where we're going to make more money for both our shareholders and our clients. When you look at it from a leverage perspective, we continue to leverage technology and investments in AI to achieve additional efficiencies. We expect to drive, going forward, $125 million in savings for New Res. I pointed out in prior quarters, We own roughly 9.9% of a software company called Valen. Valen is going to be our new servicing technology. That should come online at the end of Q1 in 27. Our continued focus on expense discipline will help drive consistent, sustainable earnings growth. And we look in the quarter, NewReds delivered a 24% operating ROE, showcasing the strong performance in a challenging environment. When you look about our resilience across markets, New Res' $879 or $880 billion of servicing will continue to reward shareholders extremely well as we go forward with a very strong earning stream, strong credit at Genesis compared to the rest of the industry, and then we remain extremely vigilant on our interest rate management across the board. Page 7 really just talks again to the sum of the parts valuation. I'm not going to take you through this. The bottom line here is we think our equity is extremely cheap. We trade at a discount to book. When we look at our book value of give or take $12.50, the stock will likely open up higher this morning, but we still trade way too cheap on a relative basis, and we continue to evaluate ways to get our share price up. In the asset management segment, have a look at page 9, 200 institutional investors, 16 global offices. The products that we offer, and I pointed this out again in my opening remarks, we must have expertise in any fund or product that we offer to the market. The way that I think about our business, we are everything in credit, we are everything in real estate, we're everything in the multi-strat business. Our ABF franchise should be significantly bigger. And, you know, sometimes we think about or we always think about what's next. And it's likely going to be something in infrastructure as we go forward. It was extremely scalable and the TAM in that marketplace is massive. Page 19, the asset management business. I'm not going to hit the same bullets that I did. If you look to the bottom part of the page, the performance numbers, I think, stand, you know, they stand out relative to the PAC. You look at some of the crest line numbers. You look at Sculptor on the multi-strat side, which has been around forever. And again, very, very excited about where we're going in that business. Page 11, the asset management business as we continue to scale. Again, a lot of these numbers are repeat. A couple of things I do want to point out. Where I think we go organically... When you look at our organic growth initiatives, we expect to deliver AUM of about 75 to 80 billion by the end of 2028. We continue to look at opportunities to grow our asset management business in the M&A world. And again, like I say always, we need to lead with performance. On the commercial real estate side, I'll hit one bullet here. Just talking about opportunistic investing, we had bought two years ago an office building just outside Washington D.C., that we monetized in the third quarter. Again, these are examples how we think about buying assets at the right times. This asset was located in Boston, Virginia. I think we paid $26 or $27 million for it. We sold it with a $50-something million handle, 30% IRR, 1.6 MOIC. And when you look across the rhythm side on the balance sheet, Third quarter realizations from an IRR perspective, 43%, 1.6 MOIC across three different transactions. The other thing is when you look at capital markets in our financing business, we closed on 31 West 52nd Street on a 500 plus million dollar transaction, and we continue to focus on selective refinancing. So with that, I'll turn it over to Peter, who will take you through Alicor.