Mr. Cooper Q2 Earnings & Revenues Miss, Expenses Rise Y/Y

Core Viewpoint - Mr. Cooper Group Inc. reported second-quarter 2025 adjusted earnings per share of $3.13, missing the Zacks Consensus Estimate by 6%, but showing a year-over-year increase of 24.2% [1][9] - The company faced challenges due to rising expenses, although improvements in the Servicing and Originations segments provided some support [1][7] Revenue and Expenses - Total revenues for the second quarter rose 4.3% year over year to $608 million, but missed the consensus mark by 13.6% [2][9] - Total expenses increased by 10% year over year to $330 million [2] - Interest income grew by 14.8% year over year to $217 million, while interest expenses also rose by 16% to $217 million [2] Segment Performance - The Servicing segment reported a pre-tax operating income of $332 million, up 15.3% year over year, despite total revenues falling 4.8% to $434 million [3] - The Servicing portfolio increased by 25.1% year over year, surpassing $1.51 trillion [3] - The Originations segment's pre-tax operating income surged 68.4% year over year to $64 million, with total revenues rising 47.7% to $158 million [4] - Funded volume in the Originations segment increased significantly from $3.7 billion to $9.4 billion year over year [4] Financial Position - As of June 30, 2025, total assets were $18.5 billion, slightly up from $18.4 billion at the end of the first quarter [5] - Cash and cash equivalents were $783 million, a slight decrease from $784 million in the previous quarter [5] - Total liabilities decreased to $13.4 billion from $13.6 billion, while total shareholders' equity rose from $4.9 billion to $5.1 billion [6] Overall Assessment - The company ended the second quarter with declining net income and rising expenses, but the strength in the Originations and Servicing segments, along with a solid balance sheet, suggests potential for improvement in future financials [7]