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ARI NYSE· Apollo Commercial Real Estate Finance Inc.
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ARI NYSE· Apollo Commercial Real Estate Finance Inc.
Earnings report Q3 2023

Apollo Commercial Real Estate Finance, Inc. Reports Strong Revenue Growth in Latest Quarter

Segments of revenue

In the latest quarter, Apollo Commercial Real Estate Finance, Inc. (ARI) reported total net revenue of $81.2 million, representing an increase of $4.9 million compared to the same quarter last year. The company's revenue can be broken down into two segments. Firstly, net interest income from commercial mortgage loans amounted to $180.4 million, showing a significant increase from $120.8 million in the previous year's quarter. Secondly, revenue from real estate owned operations contributed $20.9 million to the total net revenue, up from $14.4 million in the same quarter last year.

Strengths

ARI's strong revenue growth in the latest quarter can be attributed to the increase in net interest income from commercial mortgage loans. This growth was driven by higher average index rates during the quarter compared to the previous quarter. Additionally, the company's revenue from real estate owned operations also showed positive growth, indicating successful management of their real estate assets.

Challenges

Despite the overall revenue growth, ARI faced a decrease in net income related to real estate owned in the latest quarter. This decrease was primarily due to the seasonality of the D.C. Hotel and Atlanta Hotel's operations, resulting in lower net income from operations compared to the previous quarter.

Noteworthy

It is worth noting that ARI did not record any interest income during the latest quarter, as a result of the timing of their interest recording. However, this decrease was partially offset by the increase in net interest income from commercial mortgage loans.

Summary

Apollo Commercial Real Estate Finance, Inc. reported strong revenue growth in the latest quarter, driven by an increase in net interest income from commercial mortgage loans and revenue from real estate owned operations. Despite a decrease in net income related to real estate owned, the company's overall performance indicates successful management of their target assets.

Source documents

Form 10-Q  filed on Oct 30, 2023
59 pages scanned

Reference data

Company financials Q3 revenue 84.9M
Analyst estimates Q3 EPS beat by 2.86%
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