Company: NXDT
Filing Date: 2025-11-13
Form Type: 10-Q
Source: 0001628280-25-052132
Chunk: 26

Company: NEXPOINT DIVERSIFIED REAL ESTATE TRUST
Filing Date: 2025-11-13
Form: 10-Q
Item: Item 2
Chunk 26
---
 with obtaining long-term debt financing, non-controlling interests (as described above) related to these items, change in unrealized gains (losses) and a one-time termination fee paid to the former NHT Adviser in connection with the termination of the NHT Advisory Agreement following the NHT Merger. We believe AFFO is useful to investors as a supplemental gauge of our operating performance and is useful in comparing our operating performance with other REITs that are not as involved in the aforementioned activities.

We believe that the use of FFO and AFFO, combined with the required GAAP presentations, improves the understanding of operating results of REITs among investors and makes comparisons of operating results among such companies more meaningful. While FFO and AFFO are relevant and widely used measures of operating performance of REITs, they do not represent cash flows from operations or net income (loss) as defined by GAAP and should not be considered as an alternative or substitute to those measures in evaluating our liquidity or operating performance. FFO and AFFO do not purport to be indicative of cash available to fund our future cash requirements. Further, our computation of FFO and AFFO may not be comparable to FFO and AFFO reported by other REITs that do not define FFO in accordance with the current NAREIT definition or that interpret the current NAREIT definition or define AFFO differently than we do.

The following table reconciles our calculations of FFO and AFFO to net income (loss), the most directly comparable GAAP financial measure, for the nine months ended September 30, 2025 and 2024 (in thousands, except per share amounts):

68

For the Three Months Ended September 30,For the Three Months Ended September 30,For the Nine Months Ended September 30For the Nine Months Ended September 302025202420252024% Change  (1)Net income (loss)$(12,317)$(15,420)$(91,511)$(47,490)N/MDepreciation and amortization3,858 4,510 11,795 11,408 3.4 %Realized (gains) losses(6)1 (4,987)21,876 N/MGain on sales of real estate— — (37)— — %Impairment loss— 6,134 1,752 6,134 N/MAdjustment for noncontrolling interests— 3,