Key Highlights

  • Net loss per common share was $0.92, against Net Income of $0.34 in the second quarter of 2026 and $0.74 a year earlier.
  • Earnings available for distribution came to $0.47 per common share, versus $0.50 in the prior quarter.
  • Book value per common share fell 16.1% to $6.74 from $8.03 at June 30, 2026.
  • Economic return for the quarter was (11.6)%, after monthly dividends totaling $0.36 per share.
  • Economic Debt-to-Equity Ratio climbed to 8.3x from 7.5x at the end of June.

A $98.8 million loss attributable to common stockholders

Invesco Mortgage Capital (NYSE:IVR) is an externally managed real estate Investment trust that invests in, finances and manages mortgage-backed securities. It reported third quarter 2026 results on October 29, 2026. The net loss attributable to common stockholders was $98.8 million, or $0.92 per share, compared with net income of $31.8 million, or $0.34 per share, in the second quarter and $0.74 per share a year earlier.

The swing came from other income. Total other loss reached $124.4 million, made up of a $402.1 million loss on investments partly offset by a $277.7 million gain on derivative instruments. The CEO said financial conditions tightened as investors priced in more Federal Reserve rate hikes and Agency RMBS spreads widened materially.

Net interest income nearly doubles from a year ago

Beneath the mark-to-market swings, the core spread Business expanded. Net interest income was $33.9 million, up from $30.1 million in the second quarter and $17.6 million in the third quarter of 2025, an increase of about 93% over the year on a calculated basis.

Average earning Assets rose to $7.57 billion from $6.63 billion in the prior quarter, while the average net Interest Rate Margin eased to 1.38% from 1.42%. Total expenses were $5.2 million.

Earnings available for distribution hold near the dividend

Earnings available for distribution, a non-GAAP measure that excludes gains and losses on investments and derivatives, totaled $50.3 million, or $0.47 per share, versus $0.50 in the second quarter and $0.58 in the third quarter of 2025. The effective interest rate margin was 2.56%, down from 2.82%.

Monthly common dividends totaled $0.36 per share, unchanged from the second quarter. On a calculated basis, Earnings available for distribution of $0.47 covered that payout about 1.3 times.

Book value drops to $6.74 and Leverage climbs

Book value per common share declined $1.29, or 16.1%, to $6.74. Combined with dividends declared, that produced an economic return of (11.6)% for the quarter, compared with 3.8% in the second quarter.

The reported debt-to-equity ratio rose to 7.6x from 6.3x. Repurchase agreement borrowings totaled $6.84 billion at a weighted average rate of 3.97%. The company also issued 6,706,923 common shares through its at-the-market program for net proceeds of $51.0 million.

Portfolio tilts to Agency RMBS

The investment portfolio, including to-be-announced securities, stood at $8.0 billion, with $6.6 billion in Agency RMBS, $0.7 billion in Agency TBA and $0.7 billion in Agency CMBS. Late in the quarter, management trimmed Agency CMBS and redeployed the proceeds into Agency RMBS, citing wider spreads.

Unrestricted cash and unencumbered investments totaled $401.3 million. Management described its outlook for both sectors as constructive and pointed to easing Middle East tensions and lower rate Volatility as possible tailwinds. Going forward, the figures to watch are book value, the 8.3x economic Leverage Ratio and whether earnings available for distribution keep covering the $0.36 quarterly dividend.