Invesco Mortgage Capital Reports $23.1 Million Net Loss in Q1 2026

Invesco Mortgage Capital Inc. reported a net loss of $23.1 million for the first quarter of 2026, translating to a loss of $0.28 per share, compared to a net income of $16.3 million, or $0.26 per share, in the same period of 2025. The company's total interest income increased to $79.6 million from $73.8 million year-over-year, primarily driven by a rise in average earning assets. However, the company faced significant losses on investments, totaling $54.9 million, compared to gains of $82.2 million in the prior year, which heavily impacted profitability.

The company's total assets decreased to $6.27 billion as of March 31, 2026, down from $6.48 billion at the end of 2025. This decline was largely attributed to a reduction in the fair value of mortgage-backed securities (MBS), which fell to $6.03 billion from $6.28 billion. The company’s liabilities also decreased, with total liabilities at $5.39 billion, down from $5.68 billion. The reduction in liabilities was primarily due to a decrease in repurchase agreements, which amounted to $5.34 billion, compared to $5.62 billion at the end of the previous quarter.

In terms of strategic developments, Invesco Mortgage Capital continued to manage its capital structure actively. The company repurchased 64,688 shares of its Series C Preferred Stock during the quarter, reflecting its ongoing commitment to return capital to shareholders. Additionally, the company raised $133.6 million through the issuance of common stock, which was a significant increase from the $36.1 million raised in the same quarter of the previous year. As of March 31, 2026, the company had 92,823,269 shares of common stock outstanding.

Operationally, Invesco Mortgage Capital's average earning assets rose to $5.95 billion, up from $5.42 billion year-over-year. The average cost of funds decreased to 3.92% from 4.46%, contributing to a net interest income of $27.0 million, compared to $18.8 million in the prior year. The company’s effective net interest income also increased, reflecting improved management of its interest rate swaps and overall borrowing costs. However, the company noted that the volatility in interest rates and geopolitical risks could impact future performance.

Looking ahead, Invesco Mortgage Capital expressed cautious optimism, noting that risk sentiment had improved entering the second quarter of 2026. The company anticipates that a decline in interest rate volatility and stable demand for Agency RMBS could provide a more favorable environment for its investments. However, it remains vigilant regarding potential market fluctuations and geopolitical developments that could affect its operations and financial results.