Segments

9 Months Ended

Sep. 30, 2024

Segments

Segments

Note 25—Segments

The Company conducts its business in three segments: production, servicing (together, production and servicing comprise its mortgage banking activities) and investment management:

● The production segment performs loan origination, acquisition and sale activities.

● The servicing segment performs loan servicing for loans held for sale and loans serviced for others, including for PMT, as well as provides other ancillary services for customers.

● The investment management segment represents the Company’s investment management activities relating to PMT, which include the activities associated with investment asset acquisitions and dispositions such as sourcing, due diligence, negotiation and settlement.

The Company’s reportable segments are identified based on their unique activities. The following disclosures about the Company’s business segments are presented consistent with the way the Company’s chief operating decision maker organizes and evaluates financial information for making operating decisions and assessing performance. The Company’s chief operating decision maker is its chief executive officer.

Financial performance and results by segment are as follows:

	Quarter ended September 30, 2024
	Mortgage Banking						Investment
	Production		Servicing		Total		Management		Total
	(in thousands)
Revenues: (1)
Net gains on loans held for sale at fair value	$	235,902	$	20,917	$	256,819	$	—	$	256,819
Loan origination fees		49,430		—		49,430		—		49,430
Fulfillment fees from PennyMac Mortgage Investment Trust		11,492		—		11,492		—		11,492
Net loan servicing fees		—		75,830		75,830		—		75,830
Net interest income (expense):
Interest income		79,386		145,985		225,371		99		225,470
Interest expense		81,496		136,101		217,597		—		217,597
		(2,110)		9,884		7,774		99		7,873
Management fees		—		—		—		7,153		7,153
Other		625		512		1,137		2,100		3,237
Total net revenues		295,339		107,143		402,482		9,352		411,834
Expenses		187,486		121,765		309,251		8,658		317,909
Income before provision for income taxes	$	107,853	$	(14,622)	$	93,231	$	694	$	93,925
Segment assets at end of quarter	$	6,846,311	$	16,010,758	$	22,857,069	$	14,469	$	22,871,538

(1) All revenues are from external customers.

	Quarter ended September 30, 2023
	Mortgage Banking						Investment
	Production		Servicing		Total		Management		Total
	(in thousands)
Revenues: (1)
Net gains on loans held for sale at fair value	$	127,821	$	23,553	$	151,374	$	—	$	151,374
Loan origination fees		37,701		—		37,701		—		37,701
Fulfillment fees from PennyMac Mortgage Investment Trust		5,531		—		5,531		—		5,531
Net loan servicing fees		—		185,374		185,374		—		185,374
Net interest income (expense):
Interest income		62,150		104,402		166,552		—		166,552
Interest expense		59,614		97,249		156,863		—		156,863
		2,536		7,153		9,689		—		9,689
Management fees		—		—		—		7,175		7,175
Other		823		1,037		1,860		1,604		3,464
Total net revenues		174,412		217,117		391,529		8,779		400,308
Expenses		149,219		115,913		265,132		8,379		273,511
Income before provision for income taxes	$	25,193	$	101,204	$	126,397	$	400	$	126,797
Segment assets at end of quarter	$	5,485,039	$	13,441,925	$	18,926,964	$	22,350	$	18,949,314

(1) All revenues are from external customers.

	Nine months ended September 30, 2024
	Mortgage Banking						Investment
	Production		Servicing		Total		Management		Total
	(in thousands)
Revenues: (1)
Net gains on loans held for sale at fair value	$	531,650	$	63,674	$	595,324	$	—	$	595,324
Loan origination fees		127,876		—		127,876		—		127,876
Fulfillment fees from PennyMac Mortgage Investment Trust		19,935		—		19,935		—		19,935
Net loan servicing fees		—		344,388		344,388		—		344,388
Net interest income (expense):
Interest income		227,930		354,515		582,445		262		582,707
Interest expense		226,768		364,469		591,237		—		591,237
		1,162		(9,954)		(8,792)		262		(8,530)
Management fees		—		—		—		21,474		21,474
Other		1,952		14,858		16,810		6,344		23,154
Total net revenue		682,575		412,966		1,095,541		28,080		1,123,621
Expenses		497,551		334,112		831,663		20,296		851,959
Income before provision for income taxes	$	185,024	$	78,854	$	263,878	$	7,784	$	271,662
Segment assets at end of period	$	6,846,311	$	16,010,758	$	22,857,069	$	14,469	$	22,871,538

(1) All revenues are from external customers.

	Nine months ended September 30, 2023
	Mortgage Banking						Investment
	Production		Servicing		Total		Management		Total
	(in thousands)
Revenues: (1)
Net gains on loans held for sale at fair value	$	328,796	$	68,382	$	397,178	$	—	$	397,178
Loan origination fees		108,059		—		108,059		—		108,059
Fulfillment fees from PennyMac Mortgage Investment Trust		22,895		—		22,895		—		22,895
Net loan servicing fees		—		480,289		480,289		—		480,289
Net interest income (expense):
Interest income		194,566		273,416		467,982		—		467,982
Interest expense		189,691		277,585		467,276		—		467,276
		4,875		(4,169)		706		—		706
Management fees		—		—		—		21,510		21,510
Other		1,925		1,118		3,043		6,037		9,080
Total net revenue		466,550		545,620		1,012,170		27,547		1,039,717
Expenses		436,582		340,425		777,007		24,849		801,856
Income before provision for income taxes	$	29,968	$	205,195	$	235,163	$	2,698	$	237,861
Segment assets at end of period	$	5,485,039	$	13,441,925	$	18,926,964	$	22,350	$	18,949,314

(1) All revenues are from external customers.