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Segment Information
 6 Months Ended
Jun. 30, 2025
Segment Reporting [Abstract]  
Segment Information Segment Information
Redwood operates in four segments: Sequoia Mortgage Banking, CoreVest Mortgage Banking, Redwood Investments and Legacy Investments. This segmentation aligns with the results of operations presented to our CODM in reviewing the Company for performance assessment and resource allocation. We identify our CODM to be a group consisting of the Company's Chief Executive Officer, President and Chief Financial Officer.
Our CODM evaluates performance and allocates resources on each respective segment primarily based on segment net income (loss), also referred to as segment contribution, which is also used to assess the annual budget and forecasting process and to consider budget-to-actual variances when allocating capital and personnel to the segments throughout the year.
In the second quarter of 2025, we identified and began reporting Legacy Investments as a new reportable segment, based on how the CODM evaluates performance and allocates resources. Previously included within Redwood Investments, this segment now consists of assets that are no longer strategically aligned with our core business strategies or with how we evaluate operational performance, allocate capital, and measure the success of our investment initiatives, and are primarily associated with our legacy unsecuritized bridge and term loan portfolios, certain securities within our third-party securities portfolio, and other non-core legacy assets. These assets are generally in runoff or other forms of disposition, and the CODM reviews financial results for this segment separately from other investments to inform strategic decisions regarding capital deployment and portfolio realignment. This change in segment presentation aligns with how management currently assesses performance under ASC 280, Segment Reporting, and has been applied retrospectively to all prior periods presented in this Quarterly Report on Form 10-Q. All prior period disclosures have been conformed accordingly. This change had no impact on the consolidated financial statements. See Note 8 for further discussion on our legacy unsecuritized bridge and term loan portfolios.
The accounting policies applied to the segments are the same as those described in Note 3 to the Consolidated Financial Statements of our Annual Report on Form 10-K for the year ended December 31, 2024, with the exception of allocations of certain corporate expenses not directly assigned or allocated to one of our four segments. These unallocated corporate expenses are included in the Corporate/Other column as reconciling items to our consolidated financial statements and primarily include interest expense for our senior notes, convertible and exchangeable senior notes, and trust preferred securities, indirect general and administrative expenses and other expense. In the normal course of business, loans are originated and acquired at our mortgage banking segments and may subsequently be transferred to our Redwood Investments segment either as whole loans or through the retention of securities from securitizations we sponsor and consolidate under GAAP. Our loans are accounted for under the fair value option or at the lower of cost or market value for which the carrying value approximates the fair value. Amounts transferred between segments are accounted for at fair value at the time of transfer. For a full description of our segments, see Part I, Item 1—Business in our Annual Report on Form 10-K for the year ended December 31, 2024.
The following tables present financial information by segment for the three and six months ended June 30, 2025 and 2024.
Table 4.1 – Business Segment Financial Information
Three Months Ended June 30, 2025
(In Thousands)Sequoia Mortgage BankingCoreVest Mortgage BankingRedwood InvestmentsLegacy InvestmentsCorporate/
Other		Total
Interest income$37,021 $3,737 $219,744 $23,449 $385 $284,336 
Interest expense(21,502)(1,903)(197,647)(32,898)(16,552)(270,502)
Net interest income (expense)15,519 1,834 22,097 (9,449)(16,167)13,834 
Non-interest income
Mortgage banking activities, net, excluding risk management derivatives(22,632)15,354 — — — (7,278)
Risk management derivatives gains, net (1)
47,028 1,107 — — — 48,135 
Total Mortgage banking activities, net24,396 16,461 — — — 40,857 
Investment fair value changes, net, excluding risk management derivatives— — (26,958)(74,606)(132)(101,696)
Risk management derivatives gains (losses), net (1)
— — 17,960 (968)— 16,992 
Total Investment fair value changes, net— — (8,998)(75,574)(132)(84,704)
HEI income (loss), net— — 126 (13,025)— (12,899)
Servicing income, net— — 1,608 — — 1,608 
Fee income (loss), net— 2,782 412 (985)— 2,209 
Other income (loss), net— 715 394 — (757)352 
Realized gains, net— — 640 — — 640 
Total non-interest income (loss), net24,396 19,958 (5,818)(89,584)(889)(51,937)
General and administrative expenses(7,205)(10,218)(1,528)(57)(17,975)(36,983)
Portfolio management costs— — (2,594)(7,434)— (10,028)
Loan acquisition costs(1,267)(3,514)— — — (4,781)
Other expenses— (2,203)(1,832)— — (4,035)
(Provision for) benefit from income taxes(9,289)278 1,567 2,535 347 (4,562)
Net Income (Loss) (2)
$22,154 $6,135 $11,892 $(103,989)$(34,684)$(98,492)
Total Assets$1,689,117 $301,743 $15,982,357 $2,953,731 $406,072 $21,333,020 
(1)Represents market valuation changes of derivatives that were used to manage risks associated with our mortgage banking operations, Redwood Investments and Legacy Investments. For mortgage banking, also includes other derivative financial instruments such as loan purchase commitments and interest rate locks.
(2)Net Income (Loss) by segment is also referred to as Segment Contribution.
Six Months Ended June 30, 2025
(In Thousands)Sequoia Mortgage BankingCoreVest Mortgage BankingRedwood InvestmentsLegacy InvestmentsCorporate/
Other		Total
Interest income$68,704 $8,131 $421,313 $57,601 $681 $556,430 
Interest expense(34,841)(4,293)(377,601)(65,212)(32,707)(514,654)
Net interest income (expense)33,863 3,838 43,712 (7,611)(32,026)41,776 
Non-interest income
Mortgage banking activities, net, excluding risk management derivatives(21,268)29,201 — — — 7,933 
Risk management derivatives gains, net (1)
67,815 (1,838)— — — 65,977 
Total Mortgage banking activities, net46,547 27,363 — — — 73,910 
Investment fair value changes, net, excluding risk management derivatives— — (49,626)(77,677)(212)(127,515)
Risk management derivatives gains (losses), net (1)
— — 44,251 (6,628)— 37,623 
Total Investment fair value changes, net— — (5,375)(84,305)(212)(89,892)
HEI income (loss), net— — 181 (2,914)— (2,733)
Servicing income, net— — 5,015 — — 5,015 
Fee income (loss), net— 5,861 554 (1,855)— 4,560 
Other income (loss), net— 2,397 764 — (1,259)1,902 
Realized gains, net— — 1,207 — — 1,207 
Total non-interest income (loss), net46,547 35,621 2,346 (89,074)(1,471)(6,031)
General and administrative expenses(13,551)(20,815)(2,877)(73)(37,138)(74,454)
Portfolio management costs— — (4,654)(11,865)— (16,519)
Loan acquisition costs(2,338)(6,011)— — — (8,349)
Other expenses— (4,405)(3,539)— — (7,944)
(Provision for) benefit from income taxes(16,551)927 1,871 2,535 394 (10,824)
Net Income (Loss) (2)
$47,970 $9,155 $36,859 $(106,088)$(70,241)$(82,345)
Total Assets$1,689,117 $301,743 $15,982,357 $2,953,731 $406,072 $21,333,020 
(1)Represents market valuation changes of derivatives that were used to manage risks associated with our mortgage banking operations, Redwood Investments and Legacy Investments. For mortgage banking, also includes other derivative financial instruments such as loan purchase commitments and interest rate locks.
(2)Net Income (Loss) by segment is also referred to as Segment Contribution.
Three Months Ended June 30, 2024
(In Thousands)Sequoia Mortgage BankingCoreVest Mortgage BankingRedwood InvestmentsLegacy InvestmentsCorporate/
Other		Total
Interest income$21,097 $7,008 $155,045 $41,697 $570 $225,417 
Interest expense(9,922)(5,504)(130,575)(39,861)(14,262)(200,124)
Net interest income (expense)11,175 1,504 24,470 1,836 (13,692)25,293 
Non-interest income (loss)
Mortgage banking activities, net, excluding risk management derivatives18,264 13,046 — — — 31,310 
Risk management derivatives (losses), net (1)
(12,019)(367)— — — (12,386)
Total Mortgage banking activities, net6,245 12,679 — — — 18,924 
Investment fair value changes, net, excluding risk management derivatives— — 17,083 (17,079)(1,450)(1,446)
Risk management derivatives gains, net (1)
— — — 2,544 — 2,544 
Total Investment fair value changes, net— — 17,083 (14,535)(1,450)1,098 
HEI income, net— — — 15,883 — 15,883 
Servicing income, net— — 3,549 — — 3,549 
Fee income, net— 1,174 428 61 — 1,663 
Other income (loss), net— — 1,038 — (1)1,037 
Realized gains, net— — — — — — 
Total non-interest income (loss), net6,245 13,853 22,098 1,409 (1,451)42,154 
General and administrative expenses(4,957)(9,677)(1,349)(88)(17,213)(33,284)
Portfolio management costs— — (1,201)(3,642)(21)(4,864)
Loan acquisition costs(980)(2,433)(13)(238)— (3,664)
Other expenses— (2,203)(2,974)— — (5,177)
(Provision for) Benefit from income taxes(1,560)(449)(2,914)— (1)(4,924)
Net Income (Loss) (2)
$9,923 $595 $38,117 $(723)$(32,378)$15,534 
Total Assets$1,106,416 $371,980 $11,420,075 $3,230,928 $361,705 $16,491,104 
(1)Represents market valuation changes of derivatives that were used to manage risks associated with our mortgage banking operations and Legacy Investments. For mortgage banking, also includes other derivative financial instruments such as loan purchase commitments and interest rate locks.
(2)Net Income (Loss) by segment is also referred to as Segment Contribution.
Six Months Ended June 30, 2024
(In Thousands)Sequoia Mortgage BankingCoreVest Mortgage BankingRedwood InvestmentsLegacy InvestmentsCorporate/
Other		Total
Interest income$35,409 $10,779 $294,818 $86,822 $2,329 $430,157 
Interest expense(18,188)(8,381)(247,049)(78,685)(28,351)(380,654)
Net interest income (expense)17,221 2,398 47,769 8,137 (26,022)49,503 
Non-interest income (loss)
Mortgage banking activities, net, excluding risk management derivatives23,002 17,266 — — — 40,268 
Risk management derivatives (losses) gains, net (1)
(8,930)2,142 — — — (6,788)
Total Mortgage banking activities, net14,072 19,408 — — — 33,480 
Investment fair value changes, net, excluding risk management derivatives— — 40,637 (23,827)(800)16,010 
Risk management derivatives gains, net (1)
— — — 6,925 — 6,925 
Total Investment fair value changes, net— — 40,637 (16,902)(800)22,935 
HEI income, net— — — 24,969 — 24,969 
Servicing income, net— — 7,774 — — 7,774 
Fee income, net— 1,800 733 131 — 2,664 
Other income (loss), net— — 1,208 — (946)262 
Realized gains, net— — 314 — 95 409 
Total non-interest income (loss), net14,072 21,208 50,666 8,198 (1,651)92,493 
General and administrative expenses(9,746)(21,102)(4,164)(52)(32,789)(67,853)
Portfolio management costs— — (2,210)(6,225)(26)(8,461)
Loan acquisition costs(1,551)(4,097)(14)(239)— (5,901)
Other expenses— (5,008)(3,530)— — (8,538)
(Provision for) Benefit from income taxes(3,054)1,687 (4,060)— (20)(5,447)
Net Income (Loss) (2)
$16,942 $(4,914)$84,457 $9,819 $(60,508)$45,796 
Total Assets$1,106,416 $371,980 $11,420,075 $3,230,928 $361,705 $16,491,104 
(1)Represents market valuation changes of derivatives that were used to manage risks associated with our mortgage banking operations and Legacy Investments. For mortgage banking, also includes other derivative financial instruments such as loan purchase commitments and interest rate locks.
(2)Net Income (Loss) by segment is also referred to as Segment Contribution.