NMI Holdings signals continued disciplined growth with $13B NIW and record $218.4B insurance-in-force while managing macro risks

Earnings Call Insights: NMI Holdings, Inc. (NMIH) Q3 2025

MANAGEMENT VIEW

* Bradley Shuster, Executive Chairman, reported that "in the third quarter, National MI again delivered standout operating performance, continued growth in our insured portfolio and strong financial results," highlighting $13 billion of new insurance written (NIW) and a record $218.4 billion of primary insurance-in-force.
* Adam Pollitzer, President and CEO, emphasized the company's performance, stating, "We generated $13 billion of NIW volume and ended the period with a record $218.4 billion of high-quality, high-performing primary insurance-in-force. Total revenue in the third quarter was a record $178.7 million, and we delivered GAAP net income of $96 million or $1.22 per diluted share and a 15.6% return on equity."
* Pollitzer noted, "The macro environment and housing market have remained resilient through an extended period of headline volatility. Our lender customers and their borrowers continue to rely on us in size for critical down payment support, and we see an attractive and sustained new business opportunity fueled by long-term secular trends and furthered by the recent improvement in mortgage rates."
* Aurora Swithenbank, CFO, stated, "Total revenue was a record $178.7 million, GAAP net income was $96 million or $1.22 per diluted share and return on equity was 15.6%. We generated $13 billion of NIW and our primary insurance-in-force grew to $218.4 billion, up 2% from the end of the second quarter and 5% compared to the third quarter of 2024."
* Swithenbank also highlighted that "our expense ratio was a record low 19.3% in the quarter, highlighting the significant operating leverage embedded in our business and the success we have achieved in efficiently managing our cost base."

OUTLOOK

* Management stated, "We see a clear opportunity for continued outperformance" and pointed to "an attractive and sustained new business opportunity fueled by long-term secular trends and furthered by the recent improvement in mortgage rates."
* Pollitzer explained the approach to macro risks: "We've maintained a proactive stance with respect to our pricing, risk selection and reinsurance decisioning."
* Swithenbank described confidence in the reinsurance market: "Reinsurance markets remain very robust... we have a really nice runway in terms of our locked-in capacity in the traditional reinsurance market."

FINANCIAL RESULTS

* The company reported $178.7 million in total revenue in Q3 2025 compared to $173.8 million in the previous quarter.
* GAAP net income was $96 million and diluted EPS was $1.22.
* Net premiums earned reached $151.3 million, up from $149.1 million in Q2.
* Investment income rose to $26.8 million from $24.9 million in Q2.
* Underwriting and operating expenses were $29.2 million, slightly down from $29.5 million in Q2.
* The expense ratio improved to a record low 19.3%.
* The company repurchased $24.6 million of common stock during the quarter.
* At quarter end, total cash and investments were $3.1 billion, shareholders’ equity was $2.5 billion, and book value per share was $32.62.

Q&A

* Terry Ma, Barclays: Asked about the muted increase in defaults and future expectations. Pollitzer responded, "We're still greatly encouraged by the performance of our portfolio overall... The impact of seasonality coming through this year was a bit more muted, which is encouraging."
* Ma followed up on the competitive environment amid rumors of a new entrant. Pollitzer indicated skepticism about the viability of new market entrants, citing capital and operational challenges, stating, "It takes a lot of capital, a very large amount of capital to fund the PMIERs compliance business."
* Bose George, KBW: Questioned consumer strength and regional housing markets. Pollitzer replied, "Headline unemployment remains low, inflation is cooled... there are certain geographies, Florida, Texas, the Sunbelt, Mountain West where we're seeing some... a declining pace of house price appreciation or a turn in prices with inventory building."
* George asked about reinsurance market dynamics. Swithenbank explained, "Reinsurance markets remain very robust... we've been more biased towards the traditional reinsurance market."
* Mark Hughes, Truist: Inquired about core yield stability and persistency if rates drop. Swithenbank said, "It has been very stable... we would expect that plus/minus that kind of number for the core yield will be good."
* Hughes asked about nonrecurring expenses. Swithenbank responded, "There was nothing in particular that I'd point out in the quarter."
* A.J. Denham, JPMorgan: Asked how the company recaptures MI if refis increase. Pollitzer explained, "The most important piece of the playbook is to be everywhere in the market and be offering valuable solutions for our customers."

SENTIMENT ANALYSIS

* Analysts posed probing but neutral questions, focusing on credit trends, market competition, and strategic responses to macro developments.
* Management tone was consistently confident during prepared remarks and Q&A, emphasizing resilience and discipline, with phrases such as "we're delighted with how our portfolio is performing" and "we are well positioned."
* Compared to the previous quarter, sentiment remained stable; analysts maintained a constructive but cautious stance, while management displayed similar levels of confidence and transparency.

QUARTER-OVER-QUARTER COMPARISON

* Guidance language remained consistently optimistic, with continued emphasis on disciplined risk management and operating efficiency.
* The company maintained its strategic focus on portfolio growth, expense control, and capital returns, with no major shifts in priorities.
* Key metrics, including NIW, insurance-in-force, revenue, and net income, all increased modestly from the previous quarter.
* Management sentiment retained a confident and proactive tone, paralleling the previous quarter, and analysts' questions continued to center on credit and risk trends and market dynamics.

RISKS AND CONCERNS

* Management acknowledged ongoing macro risks, maintaining a proactive approach to pricing, risk selection, and reinsurance.
* Analyst concerns centered on potential new entrants, consumer strength in select markets, and the impact of shifting interest rates on persistency and credit trends.
* Geographic softness was cited in Florida, Texas, the Sunbelt, and Mountain West, with continued watchfulness on those regions.

FINAL TAKEAWAY

NMI Holdings highlighted a record-setting quarter with robust new business and portfolio growth, improved operating leverage, and disciplined risk management. The company remains confident in its ability to navigate macro uncertainties, sustain growth, and deliver shareholder value, supported by a high-quality insured book and efficient cost structure.

Read the full Earnings Call Transcript [https://seekingalpha.com/symbol/nmih/earnings/transcripts]

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