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Sep 30, 2023
First American Q3 2023 Earnings Report
First American reported a net loss of $2 million and adjusted net income of $128 million for Q3 2023.
Key Takeaways
First American Financial Corporation reported a decrease in total revenue to $1.5 billion, a 19% decrease compared to the third quarter of 2022. The company experienced a net loss of $2 million, or 2 cents per diluted share. Despite challenging market conditions, the company's focus on expense management and growth in net investment income led to a pretax title margin of 10.5 percent, or 12.0 percent on an adjusted basis.
Earnings per diluted share of ($0.02), or $1.22 per share on an adjusted basis
Total revenue of $1.5 billion, down 19 percent compared with last year
Title Insurance and Services segment investment income of $142 million, up 35 percent compared with last year
Title Insurance and Services segment provision for policy losses and other claims reduced to 3.0 percent of title premiums and escrow fees, down from the previous loss rate of 3.5 percent
First American
First American
First American Revenue by Segment
Revenue by Segment
Title Insurance and Services Revenue
CapyFin.comHome Warranty Revenue
CapyFin.com Forward Guidance
First American expects difficult market conditions to persist well into next year, weighing on both residential and commercial businesses. However, the company's financial discipline and strong balance sheet allow it to continue investing in strategic initiatives and returning capital to shareholders.
Positive Outlook
- Financial discipline
- Strong balance sheet
- Continued investment in strategic initiatives
- Returning capital to shareholders
- Raised the common stock dividend
Challenges Ahead
- Difficult market conditions
- Challenging market conditions will persist well into next year
- Weigh on both residential and commercial businesses
- Rapid increase in interest rates
- Housing affordability currently at its lowest point in over three decades
Revenue & Expenses
Visualization of income flow from segment revenue to net income