Dynex Capital, Inc. Earnings Summary — Q1 FY2026

• The company reported a significant net loss of $80.4 million for Q1 2026 compared to a $3.1 million loss in the prior year period.
• Total assets expanded aggressively to $24.3 billion, up from $17.3 billion at the end of 2025, primarily driven by Agency MBS purchases.
• Net interest income saw a substantial year-over-year increase of 362% to $79.3 million, reflecting a larger interest-earning asset base.
• Dynex recognized a large unrealized loss of $251.8 million on investments, partially offset by a $104.7 million gain on derivative hedging instruments.
• The company raised $441.7 million through the issuance of 32.1 million new common shares during the quarter.
• Repurchase agreements, the primary funding source, increased significantly to $21.0 billion from $13.9 billion at year-end.
• Book value remains sensitive to market volatility, as evidenced by a comprehensive loss to common shareholders of $83.2 million.

Management emphasizes a disciplined approach to risk management, specifically targeting 'Economic Return' (change in book value plus dividends) to navigate market cycles.

Deteriorating

While net interest income improved, the substantial unrealized losses on the investment portfolio and significant equity dilution have pressured bottom-line earnings and book value per share.

The company continues to focus on a high-liquidity 'fortress' balance sheet while scaling its portfolio of Agency residential and commercial mortgage-backed securities to capture yield spreads.