Company: RWT-PA
Filing Date: 2025-11-07
Form Type: 10-Q
Source: 0000930236-25-000037
Chunk: 175

Company: REDWOOD TRUST INC
Filing Date: 2025-11-07
Form: 10-Q
Item: Part I, Item 1
Chunk 175
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’s main sources of income are net interest income and other income from investments, changes in fair value of investments and associated hedges, and realized gains and losses upon the sale or disposition of assets. Direct operating expenses and tax provisions associated with these activities are also included in this segment.

The following table presents an earnings summary for our Legacy Investments segment for the three and nine months ended September 30, 2025, the immediate preceding quarter ended June 30, 2025, and the year-to-date period ended September 30, 2024.

Table 12 – Legacy Investments Earnings SummaryThree Months EndedNine Months Ended(In Thousands)September 30, 2025June 30, 2025ChangeSeptember 30, 2025September 30, 2024ChangeNet interest (loss) income$(9,052)$(9,449)$397 $(16,664)$9,613 $(26,277)Investment fair value changes, net(6,741)(75,574)68,833 (91,046)(19,741)(71,305)HEI (loss) income, net(291)(13,025)12,734 (3,205)35,664 (38,869)Fee (loss) income, net(938)(985)47 (2,793)(733)(2,060)Other (loss) income, net(532)— (532)(532)— (532)Operating expenses(4,105)(7,491)3,386 (16,041)(11,308)(4,733)(Provision for) benefit from income taxes(571)2,535 (3,106)1,964 — 1,964 Segment (Loss) Contribution$(22,230)$(103,989)$81,759 $(128,317)$13,495 $(141,812)

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Investment fair value changes, net is primarily comprised of the change in fair value (both realized and unrealized) of our loans and portfolio investments accounted for under the fair value option and related interest rate hedges. See Table 3 in the Consolidated Results of Operations in Part I, Item 2 of this Quarterly Report on Form 10-Q for further detail on the composition of investment fair value changes (the difference in amounts in the table above and in Table 3 relates to fair value changes for investments held at corporate/other).

 We hold certain of our investments at our TR