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Segment Information | 3 Months Ended
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Mar. 31, 2025
Segment Reporting [Abstract] |
Segment Information | Segment Information Redwood operates in three segments: Sequoia Mortgage Banking, CoreVest Mortgage Banking and Redwood Investments. The accounting policies of the reportable segments are the same as those described in Note 3 to the Consolidated Financial Statements of our Annual Report on Form 10-K for the year ended December 31, 2024. For a full description of our segments, see Part I, Item 1—Business in our Annual Report on Form 10-K for the year ended December 31, 2024. This segmentation aligns with the results of operations presented to our chief operating decision maker ("CODM") in reviewing the Company for performance assessment and resource allocation. We identify our CODM to be a group consisting of the Company's Chief Executive Officer, President and Chief Financial Officer. Our CODM evaluates performance and allocates resources on each respective segment primarily based on segment net income (loss), also referred to as segment contribution, which is also used to assess the annual budget and forecasting process and to consider budget-to-actual variances when allocating capital and personnel to the segments throughout the year. The accounting policies applied to the segments are the same as those described in Note 3 to the Consolidated Financial Statements of our Annual Report on Form 10-K for the year ended December 31, 2024, with the exception of allocations of certain corporate expenses not directly assigned or allocated to one of our three segments. These unallocated corporate expenses are included in the Corporate/Other column as reconciling items to our consolidated financial statements and primarily include interest expense for our senior notes, convertible and exchangeable senior notes, and trust preferred securities, indirect general and administrative expenses and other expense. In the normal course of business, loans are originated and acquired at our mortgage banking segments and may subsequently be transferred to our Redwood Investments segment either as whole loans or through the retention of securities from securitizations we sponsor and consolidate under GAAP. All of our loans are accounted for under the fair value option and amounts transferred between segments are accounted for at fair value at the time of transfer. The following tables present financial information by segment for the three months ended March 31, 2025 and 2024. Table 4.1 – Business Segment Financial Information
|  | Three Months Ended March 31, 2025
(In Thousands) |  | Sequoia Mortgage Banking |  | CoreVest Mortgage Banking |  | Redwood Investments |  | Corporate/ Other |  | Total
Interest income |  | $ | 31,683 |  |  | $ | 4,394 |  |  | $ | 235,721 |  |  | $ | 296 |  |  | $ | 272,094 |
Interest expense |  | (13,339) |  |  | (2,389) |  |  | (212,268) |  |  | (16,156) |  |  | (244,152) |
Net interest income (expense) |  | 18,344 |  |  | 2,005 |  |  | 23,453 |  |  | (15,860) |  |  | 27,942 |
Non-interest income |  |  |  |  |  |  |  |  |  |
Mortgage banking activities, net, excluding risk management derivatives |  | 1,364 |  |  | 13,847 |  |  | — |  |  | — |  |  | 15,211 |
Risk management derivatives gains (losses), net (1) |  | 20,787 |  |  | (2,945) |  |  | — |  |  | — |  |  | 17,842 |
Total Mortgage banking activities, net |  | 22,151 |  |  | 10,902 |  |  | — |  |  | — |  |  | 33,053 |
Investment fair value changes, net, excluding risk management derivatives |  | — |  |  | — |  |  | (25,739) |  |  | (80) |  |  | (25,819) |
Risk management derivatives gains, net (1) |  | — |  |  | — |  |  | 20,631 |  |  | — |  |  | 20,631 |
Total Investment fair value changes, net |  | — |  |  | — |  |  | (5,108) |  |  | (80) |  |  | (5,188) |
HEI income, net |  | — |  |  | — |  |  | 10,166 |  |  | — |  |  | 10,166 |
Servicing income, net |  | — |  |  | — |  |  | 3,407 |  |  | — |  |  | 3,407 |
Fee income, net |  | — |  |  | 3,079 |  |  | (728) |  |  | — |  |  | 2,351 |
Other income (loss), net |  | — |  |  | — |  |  | 370 |  |  | 1,180 |  |  | 1,550 |
Realized gains, net |  | — |  |  | — |  |  | 567 |  |  | — |  |  | 567 |
Total non-interest income, net |  | 22,151 |  |  | 13,981 |  |  | 8,674 |  |  | 1,100 |  |  | 45,906 |
General and administrative expenses |  | (6,346) |  |  | (10,597) |  |  | (1,365) |  |  | (19,163) |  |  | (37,471) |
Portfolio management costs |  | — |  |  | — |  |  | (6,491) |  |  | — |  |  | (6,491) |
Loan acquisition costs |  | (1,071) |  |  | (2,497) |  |  | — |  |  | — |  |  | (3,568) |
Other expenses |  | — |  |  | (2,202) |  |  | (1,707) |  |  | — |  |  | (3,909) |
(Provision for) benefit from income taxes |  | (7,261) |  |  | 648 |  |  | 304 |  |  | 47 |  |  | (6,262) |
Net Income (Loss) (2) |  | $ | 25,817 |  |  | $ | 1,338 |  |  | $ | 22,868 |  |  | $ | (33,876) |  |  | $ | 16,147 |
Total Assets |  | $ | 1,559,117 |  |  | $ | 343,985 |  |  | $ | 17,601,951 |  |  | $ | 366,722 |  |  | $ | 19,871,775 |
(1)Represents market valuation changes of derivatives that were used to manage risks associated with our mortgage banking operations and Redwood Investments. For mortgage banking, also includes other derivative financial instruments such as loan purchase commitments and interest rate locks. (2)Net Income (Loss) by segment is also referred to as Segment Contribution.
|  | Three Months Ended March 31, 2024
(In Thousands) |  | Sequoia Mortgage Banking |  | CoreVest Mortgage Banking |  | Redwood Investments |  | Corporate/ Other |  | Total
Interest income |  | $ | 14,313 |  |  | $ | 3,771 |  |  | $ | 184,898 |  |  | $ | 1,758 |  |  | $ | 204,740 |
Interest expense |  | (8,266) |  |  | (2,877) |  |  | (155,299) |  |  | (14,088) |  |  | (180,530) |
Net interest income (expense) |  | 6,047 |  |  | 894 |  |  | 29,599 |  |  | (12,330) |  |  | 24,210 |
Non-interest income (loss) |  |  |  |  |  |  |  |  |  |
Mortgage banking activities, net, excluding risk management derivatives |  | 4,738 |  |  | 4,220 |  |  | — |  |  | — |  |  | 8,958 |
Risk management derivatives gains, net (1) |  | 3,089 |  |  | 2,509 |  |  | — |  |  | — |  |  | 5,598 |
Total Mortgage banking activities, net |  | 7,827 |  |  | 6,729 |  |  | — |  |  | — |  |  | 14,556 |
Investment fair value changes, net, excluding risk management derivatives |  | — |  |  | — |  |  | 16,806 |  |  | 650 |  |  | 17,456 |
Risk management derivatives gains, net (1) |  | — |  |  | — |  |  | 4,381 |  |  | — |  |  | 4,381 |
Total Investment fair value changes, net |  | — |  |  | — |  |  | 21,187 |  |  | 650 |  |  | 21,837 |
HEI income, net |  | — |  |  | — |  |  | 9,086 |  |  | — |  |  | 9,086 |
Servicing income, net |  | — |  |  | — |  |  | 4,225 |  |  | — |  |  | 4,225 |
Fee income, net |  | — |  |  | 626 |  |  | 375 |  |  | — |  |  | 1,001 |
Other income (loss), net |  | — |  |  | — |  |  | 170 |  |  | (945) |  |  | (775) |
Realized gains, net |  | — |  |  | — |  |  | 314 |  |  | 95 |  |  | 409 |
Total non-interest income (loss), net |  | 7,827 |  |  | 7,355 |  |  | 35,357 |  |  | (200) |  |  | 50,339 |
General and administrative expenses |  | (4,789) |  |  | (11,425) |  |  | (2,175) |  |  | (16,180) |  |  | (34,569) |
Portfolio management costs |  | — |  |  | — |  |  | (3,588) |  |  | (9) |  |  | (3,597) |
Loan acquisition costs |  | (572) |  |  | (1,663) |  |  | — |  |  | (2) |  |  | (2,237) |
Other expenses |  | — |  |  | (2,806) |  |  | (555) |  |  | — |  |  | (3,361) |
(Provision for) Benefit from income taxes |  | (1,494) |  |  | 2,136 |  |  | (1,146) |  |  | (19) |  |  | (523) |
Net Income (Loss) (2) |  | $ | 7,019 |  |  | $ | (5,509) |  |  | $ | 57,492 |  |  | $ | (28,740) |  |  | $ | 30,262 |
Total Assets |  | $ | 594,842 |  |  | $ | 383,090 |  |  | $ | 13,692,180 |  |  | $ | 387,862 |  |  | $ | 15,057,974 |
(1)Represents market valuation changes of derivatives that were used to manage risks associated with our mortgage banking operations and Redwood Investments. For mortgage banking, also includes other derivative financial instruments such as loan purchase commitments and interest rate locks. (2)Net Income (Loss) by segment is also referred to as Segment Contribution.

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/exampleRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 48 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482785/280-10-55-48 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards 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