CHIMERA INVESTMENT CORPCIM
CHIMERA INVESTMENT CORP Segments Disclosure
Segment Reporting
In 2025, Chimera reevaluated the composition and number of its reportable segments based on changes in the significance of certain business activities, including the acquisition of HomeXpress, and the manner in which the Company’s Chief Operating Decision Maker (“CODM”) reviews operating results and allocates resources. As a result of this reevaluation, the Company revised its presentation and composition of its reportable segments beginning in 2025.
Chimera conducts its business and generates substantially all of its revenues primarily in the U.S. through operating segments that have been aggregated into the following reportable segments based on similar economic characteristics and qualitative factors in accordance with ASC 280-10-50-11: (i) Investment Portfolio and (ii) Residential Origination.
The Company does not have revenue from any single customer that represented 10% or more of consolidated revenues for the year ended December 31, 2025.
Residential Origination segment
In conjunction with the HomeXpress acquisition (Note 19), the Residential Origination segment consists of the stand-alone mortgage origination business of HomeXpress that originates consumer Non-QM, investor business purpose, and other Non-Agency and Agency mortgage loan products, and includes the related goodwill, intangible assets, and direct expenses, plus HomeXpress-related residential whole loans and real estate owned.
Investment Portfolio Segment
The Investment Portfolio segment consists of the Company’s investments and third-party advisory services activities, and is comprised of the Company’s investments and financial assets including (i) MSR Related Investments, (ii) Real Estate Securities, (iii) Properties and Residential Mortgage Loans, (iv) Consumer loans and (v) certain ancillary investments and equity method investments, as well as associated financing, hedging, and various allocable expenses. These activities were previously reflected within the Company’s single reportable segment prior to the 2025 segment reevaluation.
Chief Operating Decision Maker and Performance Measures
This segmentation aligns with the information reviewed by the Company’s CODM for purposes of performance assessment and resource allocation. The Company identifies its CODM as the Chief Executive Officer.
The CODM evaluates performance and makes investment and operating decisions based on each segment's contribution to net income. This measure is also used in the Company’s annual budgeting and forecasting process and in assessing budget-to-actual variances when allocating capital and personnel to the segments throughout the year.
The measure of segment profit or loss used by the CODM is net income. In evaluating segment performance, the CODM is regularly provided with information regarding certain significant expense categories that are included in this measure. Significant segment expenses that are regularly reviewed by the CODM include interest expense, compensation and benefits, mortgage origination and related costs, and general and administrative expenses that are directly attributable to the segments.
The following present, for each reportable segment, revenues, the measure of segment profit or loss, and significant segment expenses that are regularly reviewed by the CODM. Segment results are prepared on the same basis as the Company’s consolidated financial statements and are reconciled to consolidated amounts below:
| For the Year Ended | ||||||||||||||||||||
| December 31, 2025 | ||||||||||||||||||||
| (dollars in thousands) | ||||||||||||||||||||
| Investment Portfolio | Residential Origination | Total | ||||||||||||||||||
| Net interest income: | ||||||||||||||||||||
| Interest income | $ | 808,384 | $ | 12,959 | $ | 821,343 | ||||||||||||||
| Interest expense | 545,245 | 9,679 | 554,924 | |||||||||||||||||
| Net interest income | 263,139 | 3,280 | 266,419 | |||||||||||||||||
| Increase in provision for credit losses | 15,705 | — | 15,705 | |||||||||||||||||
| Other income (losses): | ||||||||||||||||||||
| Net unrealized gains (losses) on derivatives | 10,371 | — | 10,371 | |||||||||||||||||
| Realized losses on derivatives | (33,352) | — | (33,352) | |||||||||||||||||
| Periodic interest on derivatives, net | 20,375 | — | 20,375 | |||||||||||||||||
| Net gains (losses) on derivatives | (2,606) | — | (2,606) | |||||||||||||||||
| Investment management and advisory fees | 35,382 | — | 35,382 | |||||||||||||||||
| Interest income from investment in MSR financing receivables | 520 | — | 520 | |||||||||||||||||
| Net unrealized gains on financial instruments at fair value | 81,735 | — | 81,735 | |||||||||||||||||
| Net realized losses on sales of investments | (23,192) | — | (23,192) | |||||||||||||||||
| Gains on extinguishment of debt | 2,142 | — | 2,142 | |||||||||||||||||
| Other investment gains | 5,733 | — | 5,733 | |||||||||||||||||
| Gain on origination and sale of loans, net | — | 20,590 | 20,590 | |||||||||||||||||
| Total other income (losses) | 99,714 | 20,590 | 120,304 | |||||||||||||||||
| Other expenses: | ||||||||||||||||||||
| Compensation and benefits | 46,490 | 10,212 | 56,702 | |||||||||||||||||
| General and administrative expenses | 27,796 | 2,199 | 29,995 | |||||||||||||||||
| Servicing and asset manager fees | 27,737 | — | 27,737 | |||||||||||||||||
| Amortization of intangibles and depreciation expenses | 3,765 | 3,418 | 7,183 | |||||||||||||||||
| Transaction expenses | 16,634 | — | 16,634 | |||||||||||||||||
| Total other expenses | 122,422 | 15,829 | 138,251 | |||||||||||||||||
| Income before income taxes | 224,726 | 8,041 | 232,767 | |||||||||||||||||
| Income tax expense (benefit) | 2,721 | (453) | 2,268 | |||||||||||||||||
| Net income | 222,005 | 8,494 | 230,499 | |||||||||||||||||
| Dividends on preferred stock | 86,031 | — | 86,031 | |||||||||||||||||
| Net income available to common shareholders | $ | 135,974 | $ | 8,494 | $ | 144,468 | ||||||||||||||
| As of | ||||||||||||||||||||
| December 31, 2025 | ||||||||||||||||||||
| (dollars in thousands) | ||||||||||||||||||||
| Investment Portfolio | Residential Origination | Total | ||||||||||||||||||
| Total assets | $ | 14,676,908 | $ | 1,131,634 | $ | 15,808,542 | ||||||||||||||
Recasted prior-year segment information has not been presented as the Company reported a single reportable segment in 2024 and the Residential Origination segment was not part of the Company’s operations during that period.
About Segments Disclosures
Segment disclosures break a company into its reportable operating units, revealing revenue, profit, and asset allocation that consolidated financial statements obscure. Under ASC 280, segments must match how the chief operating decision maker views the business, providing a window into internal management structure and resource allocation priorities.
Key signals: compare segment margins to identify which units drive profitability and which destroy value. Watch for changes in the number of reportable segments — segment aggregation or disaggregation often coincides with strategic shifts or attempts to obscure declining performance. Intersegment elimination patterns reveal internal pricing practices. The reconciliation between segment totals and consolidated figures exposes corporate overhead allocation and unallocated items. Geographic revenue concentration highlights regulatory and currency exposure. Compare segment-level capital expenditure against segment revenue to assess where management is investing for future growth versus harvesting existing assets.