Radian's revenue doubled. What is behind Inigo's rebound?
The acquired insurer recovered from the previous quarter. Its own year-earlier results set a tougher benchmark, while lower estimates for old claims helped both insurance businesses.
Radian's acquisition of Inigo more than doubled quarterly revenue and gave the mortgage insurer a second substantial source of earnings.
Third-quarter revenue reached $624.1 million, compared with $303.2 million a year earlier, before Radian owned Inigo. Net income from continuing operations rose to $172.2 million from $152.8 million.
A rebound with a tougher annual comparison
Specialty adjusted pretax operating income rose to $86.5 million from $28.6 million in the second quarter. Its combined ratio, which measures claims and operating expenses against earned premiums, improved to 80.4% from 97.7%. A lower ratio leaves more premium income after those costs.
The year-earlier comparison is less favorable. Radian's supplemental table presents Inigo's pre-acquisition results on a basis consistent with current Specialty reporting. It shows $136.0 million of adjusted pretax operating income in the third quarter of 2025 and a 64.3% combined ratio.
Current Specialty earned premiums were $311.5 million, compared with $322.7 million in that historical quarter. The acquisition increased Radian's size; the acquired business itself did not match its year-earlier profit.
Reserve releases supported both businesses
The current Specialty result included a $42.8 million benefit from lower estimates for claims from earlier years. A quiet quarter for catastrophe losses also helped. Radian describes a softening premium-rate environment in that business.
Mortgage adjusted pretax operating income fell to $206.3 million from $225.1 million, even as insurance in force grew to $285.7 billion. Lower loss estimates for earlier mortgage defaults reduced loss expense by $26.3 million. New quarterly defaults increased to 14,637 from 13,378.
Across the group, adjusted pretax operating income increased to $253.7 million from $206.1 million. That measure removes investment and currency gains or losses, purchase-accounting effects, acquired-intangible amortization and acquisition-related or other nonoperating items.
Cash and capital sit in different places
Nine-month operating cash flow from continuing operations rose to $675.8 million from $546.2 million, with Inigo contributing to the increase. Total operating cash flow exceeded $1 billion, but that includes $332.3 million from discontinued operations, largely mortgage-loan sales during the conduit wind-down.
At the parent level, Radian held $376 million of unrestricted cash and liquid investments in September, plus a separate $500 million undrawn credit line. It had fully repaid the $200 million drawn to help fund Inigo. A $450 million parent note matures in March 2027.
Radian repurchased $135 million of shares in the quarter and another $117 million in October. Its mortgage insurer paid the parent $515 million in dividends in the first nine months. A planned $145 million fourth-quarter dividend requires the Pennsylvania Insurance Department's approval.
The larger Inigo letter-of-credit agreement is a separate financing development. For the earnings story, the next test is whether Specialty's recovery continues as insurance pricing softens, alongside mortgage credit performance. The Radian company profile tracks both businesses and the capital structure.