Apollo Commercial Real Estate Finance Reports $25.99M Net Income in Q1 2025

Apollo Commercial Real Estate Finance, Inc. reported a net income of $25.99 million, or $0.16 per diluted share, for the first quarter of 2025, a significant recovery from a net loss of $104.52 million, or $(0.76) per diluted share, in the same period last year. The company’s total net revenue for the quarter was $65.82 million, down from $80.54 million in the prior year, primarily due to a decrease in interest income from commercial mortgage loans, which fell to $143.99 million from $183.72 million. The decline in revenue was partially offset by a reduction in interest expenses, which decreased to $105.06 million from $127.89 million.

In terms of operational metrics, Apollo's commercial mortgage loans increased to $7.29 billion as of March 31, 2025, compared to $6.72 billion at the end of 2024. The company also reported a rise in the number of loans in its portfolio, growing from 46 to 49. However, cash and cash equivalents saw a decline, dropping to $166.42 million from $317.40 million. The total assets of the company increased to $8.78 billion, up from $8.41 billion at the end of the previous fiscal year, reflecting a strategic focus on expanding its loan portfolio.

The company has made significant strides in managing its operational expenses, which decreased to $38.44 million from $41.34 million year-over-year. This reduction was attributed to lower general and administrative expenses and management fees. Additionally, Apollo's General Current Expected Credit Loss (CECL) Allowance increased to $40.79 million, reflecting a more cautious outlook on credit quality amid macroeconomic uncertainties. The increase was driven by new loan originations and a more adverse economic forecast, although it was partially offset by favorable portfolio seasoning.

Looking ahead, Apollo Commercial Real Estate Finance remains focused on its investment strategy, which includes originating and managing commercial mortgage loans and subordinate financings. The company has committed to maintaining its REIT status, which requires distributing at least 90% of its taxable income to shareholders. As of March 31, 2025, Apollo had $989.2 million in unfunded loan commitments, indicating potential growth opportunities in the near future. The company’s management expressed confidence in navigating the current economic landscape while continuing to seek attractive investment opportunities.