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Here are 1-2 brief analogies for ARMOUR Residential REIT (ARR):

• If a traditional REIT like Equity Residential (EQIX) is a landlord for apartment buildings, then ARMOUR Residential REIT is an investor in the mortgage bonds that finance residential properties.
• It's like a specialized, publicly traded bond fund focused exclusively on U.S. government-backed mortgage securities, similar to certain offerings from Vanguard or BlackRock, but structured as a REIT.

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• Investment Portfolio Management: ARMOUR's primary service involves actively acquiring and managing a diversified portfolio of agency residential mortgage-backed securities (RMBS) to generate net interest income for its shareholders.
• Leveraged Portfolio Financing: The company provides capital for its investments by utilizing short-term, secured financing arrangements, primarily repurchase agreements, to enhance returns.
• Interest Rate Risk Hedging: It employs various derivative instruments, such as interest rate swaps and swaptions, to strategically manage and mitigate the interest rate risk of its portfolio and financing.

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ARMOUR Residential REIT (ARR) is a mortgage REIT (mREIT). Unlike traditional companies that sell products or services, an mREIT's business model centers on investing in and managing a portfolio of mortgage-backed securities (MBS) and other mortgage-related assets.

Primarily, ARR invests in Agency residential MBS, which are residential mortgage-backed securities for which the principal and interest payments are guaranteed by U.S. government-sponsored enterprises (GSEs) such as Fannie Mae, Freddie Mac, and Ginnie Mae.

Therefore, ARMOUR Residential REIT does not have "customers" in the conventional sense of entities or individuals who purchase goods or services from it. Its income is derived from the net interest margin earned on its investment portfolio, as well as from gains or losses on the sale of securities and other investment activities. Consequently, the categories of "companies it sells to" or "individuals it serves" do not apply to ARR's core business operations as a direct seller of products or services.

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• ARMOUR Capital Management LP (Not a public company)
• U.S. Bancorp (NYSE: USB)
• KPMG LLP (Not a public company)
• JPMorgan Chase & Co. (NYSE: JPM)
• Bank of America Corporation (NYSE: BAC)
• The Goldman Sachs Group, Inc. (NYSE: GS)
• Mizuho Financial Group, Inc. (NYSE: MFG)
• Federal National Mortgage Association (OTC: FNMA)
• Federal Home Loan Mortgage Corporation (OTC: FMCC)

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Scott J. Ulm, Chief Executive Officer and Vice Chairman

Mr. Ulm has served as Chief Executive Officer and Vice Chairman of ARMOUR since March 2024, having previously been Co-Chief Executive Officer, Co-Vice Chairman, and Head of Risk Management since November 2009. He was also Chief Investment Officer until March 2018. A co-founder of ARMOUR Residential REIT, Inc., Mr. Ulm has been involved in the management of its external manager entities since 2008, initially as Co-Managing Member of ARMOUR Residential Management, LLC, and subsequently as a managing member of ARMOUR Capital Management LP since December 2014. Mr. Ulm has extensive experience in structured finance and debt capital markets, spanning nearly 30 years, including mortgage-backed securities. He previously served as CEO of Litchfield Capital Holdings from 2005 to 2009 and held several senior positions at Credit Suisse from 1986 to 2005, such as Global Head of Asset-Backed Securities and Global Co-Head of Collateralized Debt Obligations. Additionally, he was Co-Chief Executive Officer, Co-Vice Chairman, Chief Investment Officer, and Head of Risk Management of JAVELIN Mortgage Investment Corp., a publicly-traded REIT that ARMOUR acquired in April 2016. Mr. Ulm also serves as Co-Chief Executive Officer of Staton Bell Blank Check LLC and Chairman of the Board for BUCKLER Securities LLC, an affiliated broker-dealer. He also owns and manages a commercial real estate property and Lending Acres LLC, which provides agricultural loans.

Gordon M. Harper, Chief Financial Officer and Secretary

Mr. Harper was appointed Chief Financial Officer and Secretary of ARMOUR on March 11, 2024, and also retains his role as Controller. He has served as Vice President of Finance and Controller for ARMOUR and its external manager, ARMOUR Capital Management LP, since 2015, becoming a named executive officer in February 2017. Prior to joining ARMOUR, Mr. Harper dedicated 25 years to Deloitte as an audit client service partner, where he served banking and insurance clients across the United States, Canada, and the Caribbean. He is a Chartered Professional Accountant (Ontario) and a Certified Public Accountant (Illinois). Mr. Harper also holds the positions of CFO, Secretary, and board member for BUCKLER Securities LLC since March 2024.

Jeffrey J. Zimmer, Co-Managing Member of ARMOUR Capital Management LP and Special Advisor to the Board

Mr. Zimmer retired as Co-Chief Executive Officer, President, Vice Chairman, and director of ARMOUR in March 2024, but continues to serve as an ex-officio, non-voting special advisor to the Board of Directors and as a Co-Managing Member of ARMOUR Capital Management LP. He was a co-founder of ARMOUR Residential REIT, Inc. He also served as the Chief Financial Officer of ARMOUR from November 2009 to September 2012. Mr. Zimmer founded Bimini Capital Management, Inc. in 2003, where he served as Chairman, President, and CEO, and also held the same roles at Bimini Mortgage Management, Inc. His career includes over 30 years of significant experience in the mortgage-backed securities market. From 1990 to 2003, he was a Managing Director at RBS/Greenwich Capital in the Mortgage-Backed and Asset-Backed Department, and prior to that, he was employed at Drexel Burnham Lambert in institutional mortgage-backed sales from 1984 to 1990. Mr. Zimmer has also been Co-Chief Executive Officer of Staton Bell Blank Check LLC since 2015.

Desmond E. Macauley, Co-Chief Investment Officer and Head of Risk Management

Mr. Macauley was appointed Co-Chief Investment Officer and Head of Risk Management in March 2024, having previously served as the Director of Investment Strategies at ARMOUR from May 2013. He possesses 25 years of experience in the mortgage-backed securities market and has been recognized among the top analysts in Structured MBS Securities by the U.S. Institutional Investor survey. Before joining ARMOUR, Mr. Macauley was a Managing Director in the MBS Strategy group at RBS Greenwich Capital and a Vice President in the MBS Research group at Merrill Lynch.

Sergey Losyev, Co-Chief Investment Officer

Mr. Losyev has served as Co-Chief Investment Officer of ARMOUR since March 2024. He joined ARMOUR in 2016 and held the position of Deputy Chief Investment Officer from January 2020 until his current appointment. Prior to his tenure at ARMOUR, Mr. Losyev worked as an Agency MBS Portfolio Analyst at Deutsche Asset Management from 2009 to 2016, where he was involved in co-managing over $25 billion in Agency MBS assets. Earlier in his career, he worked as a financial programmer at Zebra Capital Management LLC.

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Interest Rate Sensitivity and Volatility

High Leverage

Mortgage Market Volatility and Prepayment Risks

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The addressable market for ARMOUR Residential REIT's (ARR) main products, which are investments in residential mortgage-backed securities (MBS) primarily issued or guaranteed by U.S. government-sponsored entities (GSEs) and the Government National Mortgage Association, is the U.S. mortgage-backed securities market.

The U.S. mortgage-backed securities market is one of the largest and most liquid fixed-income markets globally, with over $11 trillion of securities outstanding. As of mid-2023, the Federal Reserve reported over $11 trillion in outstanding MBS in the United States. This market is estimated to be approximately USD 15.55 trillion in 2025 and is projected to grow to USD 22.43 trillion by 2030.

More specifically, the agency MBS market, in which ARMOUR primarily invests, is approximately $5.5 trillion and constitutes a significant portion of the broader U.S. securitized market, which is around $14 trillion.

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1. Strategic Deployment of Capital into Favorable Spreads: ARMOUR Residential REIT actively raises capital through offerings and deploys it into mortgage-backed securities (MBS) at attractive spread levels. For instance, in Q3 2025, the company raised approximately $298.6 million from common stock sales and deployed capital into appealing spread opportunities. This strategic capital allocation directly enhances the interest income generated from their investment portfolio, which is a primary revenue stream.
2. Anticipated Improvement in the Mortgage Market Environment: Management anticipates a constructive medium-term market backdrop that includes factors such as Federal Reserve easing, tighter MBS spreads, and reduced market volatility. These conditions are favorable for mortgage REITs like ARR, as they can lead to improved profitability on their mortgage-backed securities investments through better net interest income and potential for realized gains on security sales.
3. Expansion and Optimization of the Investment Portfolio: The company's continued focus on increasing and optimizing its portfolio of Agency residential mortgage-backed securities (RMBS) and other high-quality assets like U.S. Treasuries is a direct driver of revenue growth. As of Q3 2025, ARR's portfolio totaled $18.2 billion, predominantly comprised of Agency MBS. Growth in the total value of these interest-earning assets, coupled with strategic adjustments to the portfolio, is expected to boost overall interest income.
4. Increased Net Interest Income (NII): As a mortgage REIT, ARMOUR's primary revenue source is net interest income, which is the difference between the interest earned on its MBS portfolio and its borrowing costs. With a constructive market outlook, including potential for tighter MBS spreads and efficient funding (repo, standing facility), the company anticipates hedged return on equities (ROEs) on incremental investments around 16%-18%. This indicates an expectation for an improved net interest spread, directly contributing to higher NII and thus increased revenue.

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Share Repurchases

• In September 2025, ARMOUR Residential REIT repurchased 684,102 shares of common stock through its stock repurchase program.
• The company has engaged in ongoing share buybacks during the third quarter and first nine months of 2025.
• Quarterly stock buybacks between Q2 2022 and Q3 2025 ranged from approximately $1.55 million to $23.24 million.

Share Issuance

• In August 2025, ARMOUR closed a public offering of 18,500,000 shares of common stock, generating approximately $302.5 million in gross proceeds, with an option for underwriters to purchase an additional 2,775,000 shares.
• During the first quarter of 2025, the company raised approximately $371.4 million by issuing nearly 20 million shares of common stock through an at-the-market offering program and an additional $0.3 million by issuing Series C Preferred Stock.
• In the second quarter of 2025, ARMOUR raised $104.6 million by issuing 6,303,710 common shares, with an additional $59 million raised post-quarter through further share issuance.

Outbound Investments

• ARMOUR Residential REIT primarily invests in a leveraged portfolio of residential mortgage-backed securities (MBS) issued or guaranteed by U.S. government-sponsored enterprises (GSEs) or the Government National Mortgage Association (Ginnie Mae).
• The company's portfolio included approximately $18.8 billion of Agency MBS and U.S. Treasury Securities as of October 2025.
• From time to time, investments also include U.S. Treasury Securities and money market instruments, with a 4% allocation to U.S. Treasuries added in the first half of 2025.

Capital Expenditures

• The net proceeds from common stock offerings are intended to be used by ARMOUR to acquire additional mortgage-backed securities and other mortgage-related assets, aligning with its investment strategy.
• In the fourth quarter of 2024, ARMOUR deployed approximately $2 billion in mortgage assets and To Be Announced (TBA) securities, with a focus on higher-coupon specified pools and TBAs in the 5.5% and 6% coupon segments.
• As of September 30, 2025, the company's portfolio totaled $18.2 billion, primarily comprised of 97.9% Agency MBS, 1.4% U.S. Treasury Securities, and 0.7% TBA Securities.