ONITY GROUP INC. 8-K

What Happened

• On January 26, 2026, Onity Group Inc. announced preliminary, unaudited financial results for Q4 2025 and full-year 2025. The company reported estimated net income attributable to common stockholders of $107M–$131M for Q4 and $166M–$190M for the full year, with diluted EPS of $12.2–$15.0 (Q4) and $19.3–$22.1 (full year). A large part of the full-year gain reflects a deferred tax valuation allowance release estimated at $102M–$122M. On the same date Onity disclosed that subsidiaries PHH Corporation and PHH Escrow Issuer LLC began an offering of $150M aggregate principal of 9.875% Senior Notes due 2029 (an add-on to $500M issued in Nov 2024).

Key Details

• Estimated deferred tax valuation allowance release: $102M–$122M (full-year impact).
• Estimated adjusted pre-tax income (non-GAAP): $7M–$11M (Q4); $80M–$84M (full year).
• Funding and servicing volumes (UPB, in millions): total origination funded $14,000 Q4 ($14B) and $43,000 full-year ($43B); Consumer Direct funded $800 Q4 ($0.8B) and $1,900 full-year ($1.9B); average servicing UPB $323,000 Q4 ($323B) and $312,000 full year ($312B).
• Liquidity and capital: ending available liquidity $205M; shares outstanding 8,521,636; debt-to-equity ~2.7:1 (3.2:1 excluding the VA release). PHH note offering: $150M of 9.875% Senior Notes due 2029 (not registered under the Securities Act).

Why It Matters

• The reported net income and EPS ranges are materially boosted by the deferred tax valuation allowance release; core operating measures (adjusted pre-tax income and adjusted ROE) are more modest, so investors should separate one-time tax benefits from ongoing operating performance.
• The $150M high‑coupon PHH note add-on increases funded debt for Onity’s PHH subsidiaries and may affect interest expense and leverage metrics; the notes will join an existing $500M series.
• Key liquidity and portfolio size figures (available liquidity $205M, servicing UPB in the hundreds of billions) provide context on scale and short-term flexibility, but final audited results may differ when filed.