Robust Share Repurchases and Book Value Growth
The company repurchased 12.4 million shares for $1.2 billion in Q2, representing 94% of quarterly net income, and book value per share rose 2.8% to $68.04.
Source: 10-Q Item 2 MD&A
Computed from published fixed rules, not a model's judgement — though one input, the count of high-severity risks, comes from the AI analysis below.
Not investment advice and not a price target: it scores the quarter's fundamentals, not the stock. Full methodology →
AI Takeaway
Arch Capital's Q2 FY2026 results reflected a disciplined underwriting approach that generated a 15.3% annualized operating return on equity and robust capital returns, despite revenue headwinds from competitive reinsurance markets. The reinsurance segment delivered $410 million in underwriting income as catastrophe losses remained low, but net premiums written fell 10.4% as the company shed underperforming business. Insurance underwriting was pinched by a higher catastrophe loss burden, pushing the combined ratio to 98.5%. Management returned $1.2 billion to shareholders through buybacks, repurchasing 94% of quarterly net income and driving book value per share up 2.8%.
Revenue
$4.67B
-10.45% YoY
EPS (Diluted)
$3.00
-7.12% YoY
Source: SEC XBRL
Arch Capital Group (ACGL) reported Q2 FY2026 revenue of $4.67B, down 10.5% year over year. ACGL's fiscal Q2 FY2026 corresponds to calendar Q2 2026.
Last 4 quarters: 3 beats
| Quarter | Actual EPS (USD) | Consensus (USD) | Result |
|---|---|---|---|
| Jun 2026This filing | 2.56 | 2.48 | Beat +3.1% |
| Mar 2026 | 2.50 | 2.53 | Miss -1.1% |
| Dec 2025 | 2.98 | 2.64 | Beat +12.7% |
| Sep 2025 | 2.77 | 2.30 | Beat +20.5% |
Adjusted (non-GAAP) EPS of $2.56 versus the $2.48 analyst consensus — a +3.1% beat for Jun 2026. Analyst consensus is quoted on the adjusted (non-GAAP) basis the street uses. GAAP diluted EPS for this quarter was $3.00.
Compiled by AI from 10-Q Item 2 of this filing
The company repurchased 12.4 million shares for $1.2 billion in Q2, representing 94% of quarterly net income, and book value per share rose 2.8% to $68.04.
Source: 10-Q Item 2 MD&A
Insurance segment underwriting income dropped to $27 million due to 7.6 points of catastrophe losses from the Iran conflict and severe convective storms in the U.S., compared to 2.9 points in the prior-year period.
Source: 10-Q Item 2 MD&A
Net premiums written in reinsurance fell 10.4% as the company non-renewed or reduced shares on inadequately priced business and increased retrocessions, while still generating $410 million in underwriting income.
Source: 10-Q Item 2 MD&A
The mortgage segment contributed $220 million in underwriting income, with high persistency of 79.9% and low delinquencies, although new originations remained subdued due to affordability challenges.
Source: 10-Q Item 2 MD&A
Annualized operating return on average common equity was 15.3%, down from 18.2% a year ago, as the company emphasized risk selection and capital discipline in a softening market.
Source: 10-Q Item 2 MD&A
Compiled by AI from this SEC filing · 1 high, 3 medium, 1 low
The company's results are sensitive to large-scale natural and man-made disasters, as evidenced by the 7.6 percentage point impact on the insurance segment's loss ratio in Q2 from the Iran conflict and severe U.S. storms.
Source: 10-Q Item 2 MD&A
Softening market conditions led to a 10.4% decline in reinsurance net premiums written as Arch Capital reduced participation in business that did not meet return thresholds, which could persist and pressure future top-line growth.
Source: 10-Q Item 2 MD&A
The investment portfolio’s total return slightly underperformed its benchmark (1.62% vs. 1.76% in Q2) due to an underweight in alternatives, and rising treasury yields could further impact fixed-income values.
Source: 10-Q Item 2 MD&A
Transitional expenses related to the MCE Acquisition have elevated the insurance segment’s expense ratio, and the non-renewal of certain MCE programs contributed to net premium declines.
Source: 10-Q Item 2 MD&A
The company has a high debt-to-equity ratio of 2.54, which is structural for insurers but could amplify the impact of adverse developments; aggressive share buybacks, while accretive, reduce capital flexibility.
Source: 10-Q Balance Sheet (XBRL) and MD&A
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue $B | 4.67 $B | 5.21 $B | -10.45% |
Net Income $B | 1.06 $B | 1.24 $B | -14.55% |
EPS (Basic) $ | 3.05 $ | 3.30 $ | -7.58% |
EPS (Diluted) $ | 3.00 $ | 3.23 $ | -7.12% |
Answers draw on this SEC filing and the data on this page
Expected release date, analyst estimates & what to watch
Arch Capital Group (ACGL) delivered a strong Q1 2026 with net income surging 82.4% YoY to $1.05B despite a 3.3% revenue decline, driven by improved underwriting results and significant capital returns via share buybacks.
ACGL delivered solid FY2025 results with revenue growing 14.3% to $19.9B and net income rising 2.0% to $4.4B, while stockholders' equity surged 16.3% and the company aggressively returned capital via $1.89B in share buybacks.
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