Segment Reporting

6 Months Ended

Jun. 30, 2025

Segment Reporting [Abstract]

Segment Reporting

4. Segment Reporting

We have one reportable segment, Mortgage Insurance, which derives its revenue primarily from mortgage insurance. In addition to this reportable segment, in All Other we report activities for our non-reportable operating segments and other business activities that consist of: (i) income (losses) from assets held by Radian Group, our holding company; (ii) general corporate operating expenses not attributable or allocated to our reportable segment; and (iii) the operating results from certain other immaterial activities and operating segments, including our Mortgage Conduit, Title, Real Estate Services and Real Estate Technology businesses.

We allocate corporate operating expenses to our Mortgage Insurance business and our immaterial operating businesses included in All Other based primarily on their respective forecasted annual percentage of total revenue, which approximates the estimated percentage of management time spent on each business. In addition, we allocate all corporate interest expense to our Mortgage Insurance segment, due to the capital-intensive nature of our Mortgage Insurance business. We do not manage assets by operating segments.

See Note 1 for additional details about our Mortgage Insurance business.

Adjusted Pretax Operating Income (Loss)

Our senior management, including our Chief Executive Officer (Radian’s chief operating decision maker), uses adjusted pretax operating income (loss) as our primary measure to evaluate the fundamental financial performance of each of Radian’s businesses and to allocate resources to them.

Adjusted pretax operating income (loss) is defined as pretax income (loss) excluding the effects of: (i) net gains (losses) on investments and other financial instruments, except for those investments and other financial instruments attributable to our Mortgage Conduit business and (ii) impairment of other long-lived assets and other non-operating items, if any, such as gains (losses) from the sale of lines of business, acquisition-related income (expenses) and gains (losses) on extinguishment of debt, among others. See Note 4 of Notes to Consolidated Financial Statements in our 2024 Form 10-K for detailed information regarding items excluded from adjusted pretax operating income (loss), including the reasons for their treatment.

Although adjusted pretax operating income (loss) excludes certain items that have occurred in the past and are expected to occur in the future, the excluded items represent those that are: (i) not viewed as part of the operating performance of our primary activities or (ii) not expected to result in an economic impact equal to the amount reflected in pretax income (loss).

The reconciliation of adjusted pretax operating income (loss) for our reportable segment to consolidated pretax income is as follows.

Reconciliation of adjusted pretax operating income (loss) to consolidated pretax income
	Three Months Ended June 30,						Six Months Ended June 30,
(In thousands)	2025			2024			2025			2024
Mortgage Insurance adjusted pretax operating income	$	189,522		$	198,763		$	383,815		$	408,613
Reconciling items
All Other adjusted pretax operating income (loss)		(16,361	)		(6,080	)		(19,820	)		(13,113	)
Net gains (losses) on investments and other financial instruments (1)		1,852			(4,438	)		(158	)		(4,331	)
Impairment of other long-lived assets and other non-operating items (2)		—			(122	)		(384	)		(4,397	)
Consolidated pretax income	$	175,013		$	188,123		$	363,453		$	386,772

(1)Does not include net gains (losses) on investments and other financial instruments that are attributable to our Mortgage Conduit business, which are included in All Other adjusted pretax operating income (loss).

(2)The non-operating item for the six months ended June 30, 2024, primarily relates to a loss on extinguishment of debt.

Segment and Revenue Information

The following table summarizes information for our Mortgage Insurance reportable segment as follows.

Reportable segment revenue, significant segment expenses and other segment information
	Three Months Ended June 30,						Six Months Ended June 30,
($ in thousands)	2025			2024			2025			2024
Total Mortgage Insurance revenues	$	288,316		$	285,983		$	572,614		$	571,006
Less:
Provision for losses		11,954			(1,769	)		27,294			(8,655	)
Policy acquisition costs		7,205			6,522			13,593			13,316
Direct other operating expenses		19,874			17,157			36,441			34,427
Allocated corporate operating expenses (1)		42,328			43,197			77,451			77,706
Interest expense		17,428			21,957			33,917			45,290
Other segment items		5			156			103			309
Adjusted pretax operating income	$	189,522		$	198,763		$	383,815		$	408,613
Other Mortgage Insurance segment information:
Direct depreciation expense	$	1,916		$	2,069		$	3,856		$	3,992
Loss Ratio (2)		5.1	%		(0.8	)%		5.8	%		(1.8	)%
Expense Ratio (3)		29.7	%		28.5	%		27.3	%		26.8	%

(1)Includes immaterial allocated depreciation expense.

(2)Calculated as provision for losses expressed as a percentage of net premiums earned.

(3)Calculated as operating expenses (which consist of policy acquisition costs, direct other operating expenses and allocated corporate operating expenses) expressed as a percentage of net premiums earned.

The following table, which represents total services revenue in our condensed consolidated statements of operations for the periods indicated, provides the disaggregation of services revenue by revenue type.

Services revenue
	Three Months Ended June 30,				Six Months Ended June 30,
(In thousands)	2025		2024		2025		2024
Mortgage Insurance
Contract underwriting services	$	42	$	309	$	215	$	519
All Other
Real Estate Services
Valuation		2,447		4,086		6,226		8,561
Single family rental		1,245		2,368		3,095		4,728
Asset management technology platform		1,250		1,223		2,527		2,423
Real estate owned asset management		1,213		1,100		2,356		2,249
Other real estate services		32		—		37		9
Title		4,013		3,540		7,274		6,113
Real Estate Technology		682		639		1,310		1,251
Total services revenue	$	10,924	$	13,265	$	23,040	$	25,853

See Note 2 of Notes to Consolidated Financial Statements in our 2024 Form 10-K for information regarding our accounting policies and the services we offer.