Radian Group Inc reported a 93% year-over-year increase in total revenues to $575 million for the second quarter of fiscal year 2026, primarily driven by the integration of its specialty insurance business, Inigo.

The company’s transformation into a global multi-line specialty insurer is evident in its financials, with net earned premiums surging 116% to $504 million. Adjusted net operating earnings per share rose to $1.14, reflecting the immediate financial benefits of the acquisition alongside continued strength in the core mortgage insurance segment.

Segment Performance and Strategic Shifts

The mortgage insurance business remains a cornerstone of profitability, with new insurance written reaching $16.3 billion, a 14% increase year-over-year. Persistency rates strengthened to 82%, supporting an all-time high primary insurance in force of $284 billion. Credit performance remained robust, with the portfolio default rate declining to 2.47% as cures exceeded new defaults.

In contrast, the specialty insurance segment, now accounting for 53% of total net premiums earned, faced a more competitive market environment. Net premiums earned in this segment grew 9% year-over-year to $267 million. However, the segment’s net combined ratio stood at 98% for the quarter, elevated by $30 million in reserves related to Middle East developments and inflation adjustments.

Capital Management and Dividends

Radian Group maintained a disciplined approach to capital allocation, returning significant value to shareholders. The company repurchased $76 million of common stock and paid $37 million in dividends during the quarter. Year-to-date share repurchases total $176 million, positioning the company to reach the upper end of its $200-$250 million full-year guidance.

Holding company liquidity increased to $412 million after repaying $75 million on its revolving credit facility. Management raised expectations for dividends from Radian Guaranty to at least $650 million for 2026, underscoring the cash-generative nature of the mortgage business.

What the Numbers Show

A divergence exists between top-line growth and underwriting margins in the specialty segment. While revenue growth was substantial due to the acquisition, the specialty combined ratio of 98% indicates margin compression. Excluding the $30 million Middle East reserve impact, the first-half combined ratio would have been in the high 80s. This suggests that while volume is expanding, the underlying rate adequacy is softening, aligning with management’s guidance that future combined ratios may settle in the low 90s as market conditions normalize.

Radian announced a major expansion of its Merchandising Planning Suite, introducing integrated capabilities across assortment, base price, promotion, shopper marketing, and space management. The update leverages a hybrid approach that combines advanced analytics and machine intelligence with decades of retail merchandising experience.

This expansion addresses the pressure on merchandising organizations to operate with leaner teams while responding rapidly to cost volatility. Radian positions its solution against opaque AI tools by ensuring every recommendation is traceable to underlying data and assumptions, allowing merchants to defend decisions to leadership and suppliers.

Integrated platform capabilities

The new suite operates on a single data foundation, connecting five key disciplines to prevent conflicting workflows. This integration ensures that changes in one area automatically inform others:

• Assortment and Space: An assortment change automatically informs the space plan.
• Pricing and Promotion: A base-price move is evaluated alongside the promotional calendar.
• Promotion Impact: Promotions are judged against their true incremental impact on the category rather than just their own lift.

Hybrid intelligence model

Radian’s model distinguishes itself by keeping human judgment central to the final plan. While AI accelerates analysis, surfaces opportunities, and pressure-tests scenarios, experienced retail logic shapes the outcome. Jason Rumley, President at Radian, stated that merchants need a connected environment where AI handles heavy lifting while practitioner expertise drives decisions.

The company emphasizes that this approach is critical in low-margin industries like grocery, where defending every price and promotion decision with data is essential. The expanded capabilities are now available to new and existing customers with modular deployment options.