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Here are 1-3 brief analogies for ARMOUR Residential REIT (ARR):

• It's like a specialized Bank of America or Wells Fargo, but instead of originating new home loans, ARMOUR's business is solely buying and holding large portfolios of existing government-guaranteed mortgage bonds.
• Think of it as a specialized Vanguard or BlackRock bond fund, but structured as a publicly traded company that focuses exclusively on residential mortgage-backed securities.

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• Agency Mortgage-Backed Securities (MBS): The company primarily invests in mortgage-backed securities issued or guaranteed by U.S. government-sponsored entities (GSEs) and government agencies.
• Non-Agency Mortgage-Backed Securities (MBS): The company also invests in securities backed by residential mortgages where the payment of principal and interest is not guaranteed by a GSE or government agency.
• Government-Sponsored Enterprise (GSE) Debt: Investments include unsecured notes and bonds issued directly by U.S. government-sponsored entities.
• U.S. Treasuries and Money Market Instruments: The company invests in U.S. Treasury securities and various money market instruments for liquidity and capital management.

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ARMOUR Residential REIT (ARR) is a mortgage real estate investment trust (mREIT). Unlike traditional operating companies that sell products or services to customers, ARR's business model is centered on investing in residential mortgage-backed securities (MBS) and other debt instruments. The company generates revenue primarily from the net interest margin between the income earned on its mortgage assets and the cost of its funding, as well as potential capital gains from its portfolio.

Therefore, ARMOUR Residential REIT does not have "customers" in the conventional sense of companies or individuals purchasing goods or services from it. Its income is derived from the performance of its investment portfolio rather than sales to a customer base.

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Scott J. Ulm, Chief Executive Officer and Vice Chairman

Mr. Ulm has served as the Chief Executive Officer and Vice Chairman of ARMOUR Residential REIT since March 2024. He was previously the Co-Chief Executive Officer, Co-Vice Chairman, and Head of Risk Management for ARMOUR from November 2009 until March 2024. Mr. Ulm has been involved in the management of ARMOUR's external manager since March 2008. He also served as a Director, Co-Chief Executive Officer, Co-Vice Chairman, Chief Investment Officer, and Head of Risk Management of JAVELIN Mortgage Investment Corp. from June 2012 through April 2016. Additionally, he serves as Chairman of the Board and Head of Corporate Finance for BUCKLER Securities LLC, an affiliate of ARMOUR's external manager. Mr. Ulm holds a B.A. summa cum laude from Amherst College, an M.B.A. from the Yale School of Management, and a J.D. degree from Yale Law School.

Gordon M. Harper, Chief Financial Officer and Secretary

Mr. Harper was appointed Chief Financial Officer and Secretary of ARMOUR Residential REIT, effective March 11, 2024. Prior to this role, he served as the Vice President of Finance and Controller for ARMOUR and its external manager, ARMOUR Capital Management LP, since 2015. Before joining ARMOUR, Mr. Harper had a 25-year career at Deloitte, where he served as an audit client service partner for 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.

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

Mr. Macauley has served as Co-Chief Investment Officer and Head of Risk Management of ARMOUR Residential REIT since March 2024. He previously held the position of Director of Investment Strategies at ARMOUR from May 2013 to March 2024. Mr. Macauley possesses 25 years of experience in the mortgage-backed securities market. His prior experience includes serving as a Managing Director in the MBS Strategy group of RBS Greenwich Capital and as a Vice President in the MBS Research group at Merrill Lynch.

Sergey Losyev, Co-Chief Investment Officer

Mr. Losyev has been Co-Chief Investment Officer of ARMOUR Residential REIT since March 2024. He joined ARMOUR in 2016 and served as Deputy Chief Investment Officer from January 2020 to March 2024. Before joining ARMOUR, he was an Agency MBS Portfolio Analyst at Deutsche Asset Management from 2009 to 2016, where he co-managed over $25 billion in Agency MBS assets. Earlier in his career, Mr. Losyev worked as a financial programmer at Zebra Capital Management LLC. He holds an MBA from the Johnson School of Management at Cornell University and a B.S. degree.

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1. Interest Rate Volatility and MBS Price Risk: As a mortgage REIT, ARMOUR Residential REIT's profitability is highly sensitive to fluctuations in interest rates. Changes in interest rates directly impact the value of its MBS portfolio and its borrowing costs, particularly for repurchase agreements (repo financing). Rising interest rates can decrease the value of existing MBS assets and increase the cost of borrowing, thereby shrinking profit margins. This risk also encompasses prepayment risk (when homeowners refinance at lower rates) and extension risk (when homeowners hold mortgages longer if rates rise), both of which can negatively affect portfolio performance. The company's core business relies on the spread between the interest earned on its MBS investments and its funding costs, making this spread highly vulnerable to interest rate changes.
2. High Leverage: ARMOUR Residential REIT operates with a significant amount of leverage, often reporting high debt-to-equity ratios (e.g., 7.9x to 8.1x). While high leverage can amplify returns when market conditions are favorable, it also magnifies potential losses during periods of economic downturns or interest rate volatility. This substantial reliance on short-term debt, such as repurchase agreements, makes the company particularly susceptible to changes in borrowing costs and market liquidity.
3. Regulatory and Market Liquidity Risks: The mortgage REIT industry, including ARMOUR Residential REIT, is subject to potential regulatory shifts. Historically, the Securities and Exchange Commission (SEC) has inquired into the business model of mortgage REITs due to their high leverage, suggesting potential for increased regulatory scrutiny. Furthermore, the company's reliance on short-term funding through repurchase agreements exposes it to market liquidity risks, where a lack of available funding could materially impact its operations.

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The addressable market for ARMOUR Residential REIT's (ARR) main products, residential mortgage-backed securities (MBS), is the U.S. Mortgage-Backed Securities market.

The U.S. Mortgage-Backed Securities market was estimated at USD 14.37 trillion in 2024 and is projected to reach USD 15.55 trillion in 2025. This market is dominated by the residential MBS segment. North America accounts for the largest market share in the Mortgaged Backed Securities Market.

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Expected drivers of future revenue growth for ARMOUR Residential REIT (ARR) over the next 2-3 years include:

1. Favorable Interest Rate Environment and Net Interest Spread Expansion: Management anticipates a supportive environment in 2026 with declining rate volatility, easing funding costs, and a steeper yield curve, which is expected to widen the net interest spread, the primary source of revenue for a mortgage REIT. Analysts also project a significant increase in estimated book value following a reduction in mortgage-backed securities (MBS) spreads. Anticipated Federal Reserve rate cuts are expected to lower the cost of short-term repurchase agreement (repo) financing, thereby widening the net interest spread.

2. Strategic Portfolio Growth and Optimization: ARMOUR significantly expanded its investment portfolio by nearly 60% in 2025, primarily acquiring Mortgage-Backed Securities (MBS), demonstrating a focus on portfolio growth. The company's strategic investments in residential MBS and U.S. Treasury Securities are intended to position it for stable growth. Furthermore, a shift towards a barbell portfolio strategy, focusing on both high-spread assets and discounted pools, is expected to enhance future performance.

3. Effective Risk Management through Hedging Strategies: ARMOUR employs an extensive hedging program, including a $12.6 billion interest rate swap book, aimed at moderating interest rate and MBS price risks across various maturities. This active risk management and hedging are crucial for protecting and stabilizing net interest income, a key component of revenue.

4. Strategic Capital Deployment and Strong Liquidity: The company's strong balance sheet and strategic investment focus position it to capitalize on market expansion and emerging investment opportunities. ARMOUR maintains substantial liquidity, reporting approximately $1.22 billion as of February 28, 2026, which provides funding flexibility and the ability to strategically deploy capital into attractive investment opportunities.

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Share Repurchases

• In October 2023, ARMOUR's board of directors authorized an increase to its common stock repurchase program, allowing for the repurchase of up to an additional 2,500,000 shares, effective October 30, 2023.
• As of December 31, 2025, there were 866,000 authorized shares of common stock remaining available for repurchase under the company's repurchase program.
• The company repurchased common shares with reported dollar amounts that varied quarterly, for instance, $23.24 million in Q3 2023, $1.35 million in Q1 2024, and $10.10 million in Q3 2025.

Share Issuance

• In August 2025, ARMOUR announced an underwritten public offering of 18,500,000 shares of common stock, with an option for underwriters to purchase up to an additional 2,775,000 shares. This offering was expected to generate gross proceeds of approximately $302.5 million, potentially rising to $347.8 million if the overallotment option was fully exercised. The net proceeds from this offering were intended for the acquisition of additional mortgage-backed securities and other mortgage-related assets.
• During the third quarter of 2023, ARMOUR raised $191.4 million of capital by issuing 7,628,578 common shares through at-the-market offerings.
• In the first quarter of 2026, through January 28, 2026, the company sold 7,469 common shares under the 2023 Common Stock ATM Sales Agreement for net proceeds of $137,990.