Q2 2026 Eagle Point Income Co Inc Earnings Call

August 13, 2026

Speaker #1: Greetings, and welcome to the Eagle Point Income Co. Q2 2026 financial results call. At this time, all participants are in listen-only mode. A question and answer session will follow the formal presentation.

Operator: Greetings, and welcome to the Eagle Point Income Company Q2 2026 financial results call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce Darren Daugherty from Prosek Partners. Please go ahead.

Speaker #1: If anyone should require operator assistance, please press *0 on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce Darren Daugherty from Prosek Partners.

Speaker #1: Please go ahead.

Speaker #2: Thank you, operator, and good morning. Welcome to the Eagle Point Income Co. earnings conference call for the second quarter of 2026. Speaking on the call today are Thomas Majewski, Chairman and Chief Executive Officer of the company; Dan Ko, Senior Principal and Portfolio Manager for the company's advisor; and Lena Umnova, Chief Accounting Officer for the advisor.

Darren Daugherty: Thank you, operator, and good morning. Welcome to Eagle Point Income Company's earnings conference call for the Q2 of 2026. Speaking on the call today are Thomas Majewski, Chairman and Chief Executive Officer of the company, Dan Ko, Senior Principal and Portfolio Manager for the company's advisor, and Lena Umnova, Chief Accounting Officer for the advisor. Before we begin, I would like to remind everyone that the matters discussed on this call include forward-looking statements or projected financial information that involve risks and uncertainties that may cause the company's actual results to differ materially from such projections. For further information on factors that could impact the company and the statements and projections contained herein, please refer to the company's filings with the Securities and Exchange Commission.

Speaker #2: Before we begin, I would like to remind everyone that the matters discussed on this call include forward-looking statements or projected financial information that involve risks and uncertainties which may cause the company's actual results to differ materially from such projections.

Darren Daugherty: Before we begin, I would like to remind everyone that the matters discussed on this call include forward-looking statements or projected financial information that involve risks and uncertainties that may cause the company's actual results to differ materially from such projections. For further information on factors that could impact the company and the statements and projections contained herein, please refer to the company's filings with the Securities and Exchange Commission.

Speaker #2: For further information on factors that could impact the company and the statements and projections contained herein, please refer to the company's filings with the Securities and Exchange Commission.

Speaker #2: Each forward-looking statement or projection of financial information made during this call is based on the information available to us as of the date of this call.

Darren Daugherty: Each forward-looking statement or projection of financial information made during this call is based on the information available to us as of the date of this call. We disclaim any obligation to update our forward-looking statements unless required by law. Earlier today, we filed our Q2 2026 financial statements and investor presentation with the Securities and Exchange Commission. These are also available in the investor relations section of the company's website, eaglepointincome.com. A replay of this call will also be made available later today. I will now turn the call over to Thomas Majewski, Chairman and Chief Executive Officer of Eagle Point Income Company. Tom?

Speaker #2: We disclaim any obligation to update our forward-looking statements unless required by law. Earlier today, we filed our second quarter 2026 financial statements and investor presentation with the Securities and Exchange Commission.

Speaker #2: These are also available in the investor relations section of the company's website, eaglepointincome.com. A replay of this call will also be made available later today.

Darren Daugherty: A replay of this call will also be made available later today. I will now turn the call over to Thomas Majewski, Chairman and Chief Executive Officer of Eagle Point Income Company. Tom?

Speaker #2: I will now turn the call over to Thomas Majewski, Chairman and Chief Executive Officer of Eagle Point Income Co. Tom?

Speaker #3: Thank you, Darren, and good morning, everyone. We appreciate your joining the Eagle Point Income Co. earnings call today. EIC had a strong second quarter.

Thomas P. Majewski: Thank you, Darren, and good morning, everyone. We appreciate your joining the Eagle Point Income Company earnings call today. EIC had a strong Q2. As of 30 June, our net asset value stood at $12.52 per share, which is an increase of 4% from $11.99 per share as of 31 March. For the quarter, the company generated a GAAP return on common equity of 7.1%. During the quarter, we paid an aggregate of $0.33 per share in cash distributions to our common shareholders. The improvement in NAV was driven by a meaningful recovery in loan prices and CLO valuations following the volatility experienced in the first quarter. Concerns around the potential impact of artificial intelligence on software borrowers, together with geopolitical developments, weighed on leverage loan prices and CLO valuations during the quarter.

Thomas Majewski: Thank you, Darren, and good morning, everyone. We appreciate your joining the Eagle Point Income Company earnings call today. EIC had a strong Q2. As of 30 June, our net asset value stood at $12.52 per share, which is an increase of 4% from $11.99 per share as of 31 March. For the quarter, the company generated a GAAP return on common equity of 7.1%. During the quarter, we paid an aggregate of $0.33 per share in cash distributions to our common shareholders.

Speaker #3: As of June 30th, our net asset value stood at $12.52 per share, which is an increase of 4% from $11.99 per share as of March 31st.

Speaker #3: For the quarter, the company generated a GAAP return on common equity of 7.1%. During the quarter, we paid an aggregate of $0.33 per share in cash distributions to our common shareholders.

Speaker #3: The improvement in NAV was driven by a meaningful recovery in loan prices and CLO valuations following the volatility experienced in the first quarter. Concerns around the potential impact of artificial intelligence on software borrowers, together with geopolitical developments, weighed on leveraged loan prices and CLO valuations during the quarter.

Thomas Majewski: The improvement in NAV was driven by a meaningful recovery in loan prices and CLO valuations following the volatility experienced in the first quarter. Concerns around the potential impact of artificial intelligence on software borrowers, together with geopolitical developments, weighed on leverage loan prices and CLO valuations during the quarter. As sentiment improved during the second quarter, loan prices and CLO valuations recovered meaningfully, while underlying credit fundamentals remained resilient.

Speaker #3: As sentiment improved during the second quarter, loan prices and CLO valuations recovered meaningfully, while underlying credit fundamentals remained resilient. We believe the first quarter decline reflected a market-driven pricing pressure rather than a broad deterioration in credit.

Thomas P. Majewski: As sentiment improved during the second quarter, loan prices and CLO valuations recovered meaningfully, while underlying credit fundamentals remained resilient. We believe the first quarter decline reflected a market-driven pricing pressure rather than a broad deterioration in credit. Elevated refinancing, reset, and call activity during the second quarter resulted in the early repayment of certain of our CLO debt investments. Because many of these investments were purchased at discounts to par, their repayment at par allowed us to realize convexity embedded in those investments sooner than we had originally anticipated. During the quarter, we deployed $39 million into new investments at a weighted average effective yield of 17.9%, allocating capital across CLO debt, CLO equity, and complementary credit investments where we identified what we believe to be very attractive risk-adjusted returns.

Thomas Majewski: We believe the first quarter decline reflected a market-driven pricing pressure rather than a broad deterioration in credit. Elevated refinancing, reset, and call activity during the second quarter resulted in the early repayment of certain of our CLO debt investments. Because many of these investments were purchased at discounts to par, their repayment at par allowed us to realize convexity embedded in those investments sooner than we had originally anticipated.

Speaker #3: Elevated refinancing, reset, and call activity during the second quarter resulted in the early repayment of certain of our CLO debt investments. Because many of these investments were purchased at discounts to par, their repayment at par allowed us to realize the convexity embedded in those investments sooner than we had originally anticipated.

Speaker #3: During the quarter, we deployed $39 million into new investments that had a weighted average effective yield of 17.9%, allocating capital across CLO debt, CLO equity, and complementary credit investments where we identified what we believed to be very attractive risk-adjusted returns.

Thomas Majewski: During the quarter, we deployed $39 million into new investments at a weighted average effective yield of 17.9%, allocating capital across CLO debt, CLO equity, and complementary credit investments where we identified what we believe to be very attractive risk-adjusted returns. We also repositioned the portfolio by rotating capital away from a certain group of underperforming CLO collateral managers towards higher conviction opportunities across CLOs and other private credit investments.

Speaker #3: We also repositioned the portfolio by rotating capital away from a certain group of underperforming CLO collateral managers towards higher conviction opportunities across CLOs and other private credit investments.

Thomas P. Majewski: We also repositioned the portfolio by rotating capital away from a certain group of underperforming CLO collateral managers towards higher conviction opportunities across CLOs and other private credit investments. While this resulted in certain losses being realized, those losses had largely been reflected as unrealized losses in prior periods, resulting in minimal incremental impact on our NAV during the quarter. Importantly, we believe the actions taken improve the portfolio's risk-adjusted return potential and enhance its long-term earnings power. Throughout the quarter, we continued to actively manage our CLO portfolio by completing one reset and two refinancings of CLO equity positions. These actions resulted in a weighted average cost savings of 33 basis points for those CLOs. In addition to lowering the debt cost, the reset position also extended its reinvestment period out to five years.

Speaker #3: While this resulted in certain losses being realized, those losses had largely been reflected as unrealized losses in prior periods, resulting in minimal incremental impact on our NAV during the quarter.

Thomas Majewski: While this resulted in certain losses being realized, those losses had largely been reflected as unrealized losses in prior periods, resulting in minimal incremental impact on our NAV during the quarter. Importantly, we believe the actions taken improve the portfolio's risk-adjusted return potential and enhance its long-term earnings power. Throughout the quarter, we continued to actively manage our CLO portfolio by completing one reset and two refinancings of CLO equity positions.

Speaker #3: Importantly, we improved the portfolio's risk-adjusted return potential and enhanced its long-term earnings power. Throughout the quarter, we continued to actively manage our CLO portfolio by completing one reset and two refinancings of CLO equity positions.

Speaker #3: These actions resulted in a weighted average cost savings of 33 basis points for those CLOs. In addition to lowering the debt costs, the reset position also extended its reinvestment period out to five years.

Thomas Majewski: These actions resulted in a weighted average cost savings of 33 basis points for those CLOs. In addition to lowering the debt cost, the reset position also extended its reinvestment period out to five years. While CLO junior debt remains central to EIC's strategy, we continue to selectively increase our exposure to infrastructure credit, portfolio debt securities, asset-backed securities, and other strategic credit investments. These opportunities are sourced through dedicated teams with specialized expertise across the broader Eagle Point platform.

Speaker #3: While CLO junior debt remained central to EIC's strategy, we continued to selectively increase our exposure to infrastructure credit portfolio debt securities, asset-backed securities, and other strategic credit investments.

Thomas P. Majewski: While CLO junior debt remains central to EIC's strategy, we continue to selectively increase our exposure to infrastructure credit, portfolio debt securities, asset-backed securities, and other strategic credit investments. These opportunities are sourced through dedicated teams with specialized expertise across the broader Eagle Point platform. As of 30 June, CLO debt represented approximately 59% of our portfolio, and CLO equity represented about 19% of our portfolio. Non-CLO investments totaled approximately 22% of our portfolio. We believe this broader opportunity set enhances portfolio diversification and allows us to allocate capital to the most attractive risk-adjusted return opportunities we see in the credit markets. One recent example we wanted to share is our investment with Sports Illustrated Tickets, a specialty finance transaction that we originated that was secured by World Cup tickets that was originated by the Eagle Point team.

Speaker #3: These opportunities are sourced through dedicated teams with specialized expertise across the broader Eagle Point platform. As of June 30, CLO debt represented approximately 59% of our portfolio, and CLO equity represented about 19% of our portfolio.

Thomas Majewski: As of 30 June, CLO debt represented approximately 59% of our portfolio, and CLO equity represented about 19% of our portfolio. Non-CLO investments totaled approximately 22% of our portfolio. We believe this broader opportunity set enhances portfolio diversification and allows us to allocate capital to the most attractive risk-adjusted return opportunities we see in the credit markets.

Speaker #3: Non-CLO investments totaled approximately 22% of our portfolio. We believe this broader opportunity set enhances portfolio diversification and allows us to allocate capital to the most attractive risk-adjusted return opportunities we see in the credit markets.

Speaker #3: One recent example we wanted to share is our investment with Sports Illustrated Tickets, a specialty finance transaction that we originated. This transaction was secured by World Cup tickets and was originated by the Eagle Point team.

Thomas Majewski: One recent example we wanted to share is our investment with Sports Illustrated Tickets, a specialty finance transaction that we originated that was secured by World Cup tickets that was originated by the Eagle Point team. Following a seven-month holding period, this investment generated a 1.2x multiple on investment capital when it was fully realized back in June. We believe Eagle Point's ability to source differentiated investment opportunities complements EIC's core CLO junior debt strategy and enhances long-term shareholder value. Turning to our capital structure, during the second quarter, we issued $1 million of our 6.00% Series AA Convertible Perpetual Preferred Stock. This fixed-rate perpetual financing provides an attractive source of long-term capital and additional flexibility to deploy capital when compelling opportunities arise. We see this financing as a significant competitive advantage, and we're unaware of any other public CLO debt-focused fund with a similar perpetual convertible preferred program. I'll now turn the call over to Senior Principal and Portfolio Manager Dan Ko for an update on the market.

Speaker #3: Following a seven-month holding period, this investment generated a 1.2x multiple on investment capital when it was fully realized back in June. We believe Eagle Point's ability to source differentiated investment opportunities complements EIC's core CLO junior debt strategy and enhances long-term shareholder value.

Thomas P. Majewski: Following a seven-month holding period, this investment generated a 1.2x multiple on investment capital when it was fully realized back in June. We believe Eagle Point's ability to source differentiated investment opportunities complements EIC's core CLO junior debt strategy and enhances long-term shareholder value. Turning to our capital structure, during the second quarter, we issued $1 million of our 6.00% Series AA Convertible Perpetual Preferred Stock. This fixed-rate perpetual financing provides an attractive source of long-term capital and additional flexibility to deploy capital when compelling opportunities arise. We see this financing as a significant competitive advantage, and we're unaware of any other public CLO debt-focused fund with a similar perpetual convertible preferred program. I'll now turn the call over to Senior Principal and Portfolio Manager Dan Ko for an update on the market.

Speaker #3: Returning to our capital structure, during the second quarter we issued $1 million of our 6% Series AA convertible perpetual preferred stock. This fixed-rate perpetual financing provides an attractive source of long-term capital and additional flexibility to deploy capital when compelling opportunities arise.

Speaker #3: We see this financing as a significant competitive advantage, and we're unaware of any other public CLO debt-focused fund with a similar perpetual convertible preferred program.

Speaker #3: I'll now turn the call over to Senior Principal and Portfolio Manager Dan Ko for an update on the market.

Speaker #4: Thanks, Tom. I'll provide a brief update on the loan and CLO. The UBS Leveraged Loan Index rose 1.9% in the second quarter and returned 0.8% in July.

Dan Ko: Thanks, Tom. I'll provide a brief update on the loan and CLO markets. The S&P/LSTA Leveraged Loan Index rose 1.9% in the second quarter and returned 0.8% in July. Average corporate revenue and EBITDA growth remained positive, supporting overall credit fundamentals across the broadly syndicated loan market, despite continued dispersion across sectors and issuers. The trailing 12-month loan default rate ended the quarter at 1.0%, compared with 1.4% on 31 March, and remained below its long-term average of 2.5%. EIC's look-through exposure to defaulted loans remained low at 36 basis points, significantly below the broader market average. We believe this reflects both the quality of our underlying loan holdings, our active portfolio management, and disciplined investment process. Software remained an area of focus during the quarter as investors continued to assess the long-term impact of AI across different sectors.

Speaker #4: Average corporate revenue and EBITDA growth remained positive, supporting overall credit fundamentals across the broadly syndicated loan market, despite continued dispersion across sectors and issuers.

Speaker #4: The trailing 12-month loan default rate ended the quarter at 1.0%, compared with 1.4% on March 31, and remained below its long-term average of 2.5%.

Speaker #4: EIC's look-through exposure to defaulted loans remained low, at 36 basis points, significantly below the broader market average. We believe this reflects both the quality of our underlying loan holdings and our active portfolio management and disciplined investment process.

Speaker #4: Software remained an area of focus during the quarter, as investors continued to assess the long-term impact of AI across different sectors. AI will likely create both winners and losers, but many software businesses continue to benefit from recurring contracted revenue, sticky customer relationships, and mission-critical products.

Dan Ko: AI will likely create both winners and losers, but many software businesses continue to benefit from recurring contracted revenue, sticky customer relationships, and mission-critical products. We believe the market reaction earlier this year overstated the likely impact on the broader software sector. For EIC, the diversification and structural protection within our CLO debt investments further help mitigate the impact of weakness in any individual borrower or sector. Loan prices recovered during the second quarter, although the improvement remained uneven across individual credits. At the end of the quarter, the look-through underlying loan portfolio had a weighted average market price of 95.30, providing opportunities for par building through discounted loan purchases. In terms of CLO market activity, new issuance totaled $33 billion during the second quarter, compared with $47 billion in the first quarter.

Speaker #4: We believe the market reaction earlier this year overstated the likely impact on the broader software sector. For EIC, the diversification and structural protection within our CLO debt investments further help mitigate the impact of weakness in any individual borrower or sector.

Speaker #4: Loan prices recovered during the second quarter, although the improvement remained uneven across individual credits. At the end of the quarter, the look-through underlying loan portfolio had a weighted average market price of $95.30, providing opportunities for par building through discounted loan purchases.

Speaker #4: In terms of CLO market activity, new issuance totaled $33 billion during the second quarter, compared with $47 billion in the first quarter. Reset activity totaled $55 billion, compared with $32 billion in the first quarter, while refinancing activity totaled $39 billion, compared with $24 billion in the first quarter.

Dan Ko: Reset activity totaled $55 billion, compared with $32 billion in the first quarter, while refinancing activity totaled $39 billion compared with $24 billion in the first quarter. We expect refinancing and reset activity to remain robust. For our CLO equity investments, this activity can lower liability costs and extend reinvestment periods. For CLO debt investments purchased at a discount, resets, refinancings, and calls can create additional opportunities to realize embedded gains through early repayments at par. We continue to believe CLO junior debt offers an attractive combination of floating-rate income, structural protection, and low historical credit expense relative to comparably rated corporate securities. If interest rates remain elevated or increase over the near to intermediate term, our CLO debt portfolio is positioned to benefit from higher income.

Speaker #4: We expect refinancing and reset activity to remain robust. For our CLO equity investments, this activity can lower liability costs and extend reinvestment periods. For CLO debt investments purchased at a discount, resets, refinancings, and calls can create additional opportunities to realize embedded gains through early repayments at par.

Speaker #4: We continue to believe CLO junior debt offers an attractive combination of floating-rate income, structural protection, and low historical credit expense relative to comparably rated corporate securities.

Speaker #4: If interest rates remain elevated or increase over the near to intermediate term, our CLO debt portfolio is positioned to benefit from higher income. Our CLO equity investments are less sensitive to changes in benchmark rates because returns are driven primarily by the underlying loan asset spreads, less the CLO's financing costs.

Dan Ko: Our CLO equity investments are less sensitive to changes in benchmark rates because returns are driven primarily by the underlying loan asset spreads, less the CLO's financing costs. At the company level, the combination of predominantly floating-rate investments and fixed-rate preferred financing creates an attractive earnings profile in this environment. With that, I'll hand it over to our advisor's Chief Accounting Officer, Lena Umnova, to walk through our financial results.

Speaker #4: At the company level, the combination of predominantly floating-rate investments and fixed-rate preferred financing creates an attractive earnings profile in this environment. With that, I'll hand it over to our advisor's chief accounting officer, Lena Umnova, to walk through our financial results.

Speaker #2: Thank you, Dan. During the second quarter, the company generated net investment income, or NII, of $0.37 per share. NII less realized losses from investments was negative $0.29 per share.

Lena Umnova: Thank you, Dan. During Q2, the company generated net investment income, or NII, of $0.37 per share. NII, less realized losses from investments, was -$0.29 per share. This compares to NII less realized losses from investments of $0.34 per share in the first quarter of 2026, and NII and realized gains of $0.39 per share in Q2 2025. Including unrealized portfolio gains, GAAP net income was $20 million, or $0.84 per share for Q2 2026. This compares to GAAP net loss of -$0.95 per share in the first quarter of 2026 and GAAP net income of $0.49 per share in Q2 2025. Recurring cash flows from company's investment portfolio totaled $12 million, or $0.52 per share during the quarter, and exceeded the company's common stock distributions and expenses.

Speaker #2: This compares to NII less realized losses from investments of $34 per share in the first quarter of 2026, and NII and realized gains of $39 per share in the second quarter of 2025.

Speaker #2: Including unrealized portfolio gains, GAAP net income was $20 million, or $0.84 per share, for the second quarter of 2026. This compares to a GAAP net loss of $0.95 per share in the first quarter of 2026 and GAAP net income of $0.49 per share in the second quarter of 2025.

Speaker #2: Recurring cash flows from the company’s investment portfolio totaled $12 million, or $0.52 per share, during the quarter, and exceeded the company’s common stock distributions and expenses.

Speaker #2: We paid three monthly common stock distributions of $0.11 per share during the quarter, and we declared monthly common stock distributions of $0.11 per share for the remainder of 2026.

Lena Umnova: We paid three monthly common stock distributions of $0.11 per share during the quarter, and we declared monthly common stock distributions of $0.11 per share for the remainder of 2026. We believe the current distribution level reflects the company's near-term earnings potentials in today's interest rate environment. Looking at our capital structure as of June month-end, the company had outstanding preferred equity securities equal to 12% of total assets less current liabilities. This is below our target range of 25% to 35%, where we expect to operate the company under normal market conditions. We expect leverage to increase over time as we raise additional capital through our continued offering of the Series AA and Series AB convertible perpetual preferred stock, the program that we launched early in 2026.

Speaker #2: We believe the current distribution level reflects the company's near-term earnings potential in today's interest rate environment. Looking at our capital structure, as of June 10th, the company had outstanding preferred equity securities equal to 12% of total assets, less current liabilities.

Speaker #2: This is below our target range of 25% to 35%, where we expect the IP rate of the company under normal market conditions. We expect leverage to increase over time as we raise additional capital through our continued offering of the Series AA and Series AB convertible perpetual preferred stock, the program that we launched early in 2026.

Speaker #2: Looking at our portfolio activity during the month of July, the company received recurring cash flows from its investments totaling $8 million. Note, the sum of the company's investments is still expected to make payments later in the quarter.

Lena Umnova: Looking at our portfolio activity during the month of July, the company received recurring cash flows from its investments totaled $8 million. Note that some of the company's investments are still expected to make payments later in the quarter. As of July month-end, net of pending investment transactions and settlement, the company had over $53 million of cash and revolver capacity available for investment and other purposes. Management's unaudited estimate of the company's NAV as of July month-end was between $12.30 and $12.40 per share. At the midpoint, this represented a 1% decrease from June month-end. I will now turn the call back over to Thomas to provide closing remarks before we take your questions.

Speaker #2: As of July 10th, net of pending investment transactions and settlements, the company had over $53 million of cash and revolver capacity available for investment and other purposes.

Speaker #2: Management's unaudited estimate of the company's NAV as of July 10th was between $12.30 and $12.40 per share. At the midpoint, this represented a 1% decrease from June 10th.

Speaker #2: I will now turn the call back over to Tom to provide closing remarks before we take your questions.

Speaker #1: Thanks, Lena. The second quarter demonstrated the benefits of active portfolio management and access to the full Eagle Point platform. We continue to selectively rotate capital toward higher conviction opportunities across CLO debt, CLO equity, and differentiated private credit investments, while strengthening our capital structure.

Thomas P. Majewski: Thanks, Lena. The Q2 demonstrated the benefits of active portfolio management and access to the full Eagle Point platform. We continue to selectively rotate capital towards higher conviction opportunities across CLO debt, CLO equity, and differentiated private credit investments while strengthening our capital structure. With healthy CLO fundamentals, a predominantly floating-rate investment portfolio, and fixed-rate preferred financing, we believe EIC is well-positioned to generate attractive income and long-term value for our fellow shareholders. We appreciate your continued support and thank you for your time and interest in Eagle Point Income Company. Lena, Dan, and I will now open the call to your questions. Operator?

Thomas Majewski: Thanks, Lena. The Q2 demonstrated the benefits of active portfolio management and access to the full Eagle Point platform. We continue to selectively rotate capital towards higher conviction opportunities across CLO debt, CLO equity, and differentiated private credit investments while strengthening our capital structure. With healthy CLO fundamentals, a predominantly floating-rate investment portfolio, and fixed-rate preferred financing, we believe EIC is well-positioned to generate attractive income and long-term value for our fellow shareholders. We appreciate your continued support and thank you for your time and interest in Eagle Point Income Company. Lena, Dan, and I will now open the call to your questions. Operator?

Speaker #1: With healthy CLO fundamentals, a predominantly floating-rate investment portfolio, and fixed-rate preferred financing, we believe EIC is well positioned to generate attractive income and long-term value for our fellow shareholders.

Speaker #1: We appreciate your continued support and thank you for your time and interest in Eagle Point Income Company. Lena, Dan, and I will now open the call to your questions.

Speaker #1: Operator?

Speaker #4: Thank you. We'll now be conducting a question and answer session. If you would like to ask a question, please press star one on your telephone keypad.

Operator: Thank you. We will now be conducting a question and answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up the handset before pressing the star keys. One moment please while we poll for questions. Thank you. Our first question is from Erik Zwick with Lucid Capital Markets.

Speaker #4: A confirmation tone will indicate your line is in the question queue. You may press star two to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up the handset before pressing the star keys.

Speaker #4: One moment, please, while we pull questions. Thank you. Our first question is from Eric Zweig with Lucid Capital Markets.

Speaker #5: Thanks. Good morning again. Maybe just to start with a question on the recurring cash distributions—you noted $8.3 million here to start the third quarter, with a little bit more expected.

Erik Zwick: Thanks. Good morning again. Maybe just start with a question on the recurring cash distributions. You noted $8.3 million here to start the Q3 with a little bit more expected throughout the quarter. That rate would seem to be below what we have seen in the past couple of quarters and kind of continuing a downward trend. If you could kind of just frame it in terms of how much of that is related to kind of market factors versus the portfolio performance, and then kind of what it would take to kind of see an inflection point and see that start growing again. Kind of curious on your thoughts there.

Speaker #5: Throughout the quarter, that rate would seem to be below what we've seen in the past couple of quarters and is continuing a downward trend.

Speaker #5: So if you could kind of just frame it in terms of how much of that is related to kind of market factors, versus the portfolio performance, and then kind of what it would take to kind of see an inflection point and see that start growing again.

Speaker #5: Can I get curious on your thoughts there?

Speaker #4: Yeah. So hey, this is Dan Ko here. A few things. So on the CLO debt side, I mean, given that we've seen or we expect kind of rates to increase in the near to kind of intermediate term, our expectation is that the cash, or at at least the income from the CLO debt portion of the portfolio, will likely increase over the next few months as kind of base rates increase.

Dan Ko: Yeah. This is Dan Ko here. A few things. On the CLO debt side, given that we're seeing or we expect rates to increase in the near to intermediate term, our expectation is that the cash, or at least the income from the CLO debt portion of the portfolio, will likely increase over the next few months as base rates increase. The decrease in cash flows was probably mainly driven by the CLO equity portion of the portfolio, which has faced spread compression over the past at least during 2025. The effects of that is really being felt more now as all those loan coupons were reset. Some of it is also driven by the fact that the underlying in some of the CLOs do have semiannual paying bonds.

Speaker #4: The decrease in cash flows is probably mainly driven by the CLO equity portion of the portfolio, which is kind of faced spread compression over the past kind of or at least during 2025, and the effects of that is really being felt more now as all those kind of loan kind of coupons were reset.

Speaker #4: Some of it's also driven by the fact that the underlying, in some of the CLOs, do have semi-annual paying bonds. So there is a little bit of a kind of a sawtooth sort of payment for CLO equity, in that it will be down one quarter and then up another quarter, kind of depending on how big the bond bucket is.

Dan Ko: And so there is a little bit of a sawtooth sort of payments for CLO equity in that it will be down one quarter and then up another quarter depending on how big the bond bucket is. This quarter being down, I expect this quarter meaning Q2 or Q3, then the following quarter would be higher. Our expectation is that we expect it to recover over time.

Speaker #4: So this quarter kind of being down, we expect—this quarter meaning Q2 or Q3—then the following quarter would be higher. So, our expectation is that we expect it to kind of recover over time.

Speaker #5: Thanks, Dan. And, Tom, I think when we were on last quarter's call, when you discussed the opportunity for share repurchases, I think you noted that you had not been as aggressive as you had in past quarters.

Erik Zwick: Thanks, Dan. Tom, I think on last quarter's call when you discussed the opportunity for share repurchases, I think you noted that you had not used aggressive as you had in past quarters. The NAV for the fund has recovered nicely in the past quarter, the stock price has not. So I guess with the discounted valuation, again, just curious if you could update your thoughts on allocating capital towards share repurchases in the next quarter or two.

Speaker #5: The NAV for the fund has recovered nicely in the past quarter. The stock price has not. So, I guess with the kind of discounted valuation again, just curious if you could update your thoughts on allocating capital toward share repurchases in the next quarter or two.

Speaker #3: Yeah. The thing we grapple with—we definitely saw the increase in NAV coming. So we felt it happening as it happened, I guess. I don't know if you can ever say for sure you saw it coming.

Thomas P. Majewski: Yeah. The thing we grapple with, we definitely saw the increase in NAV coming, so we felt it happening as it happened. I guess you can never say for sure you saw it coming. We're mindful of the discount on the share price balanced against the liquidity in the stock and the daily volume. One of the things I think I said on the last call was we backed off somewhat just due to the impact we saw on the volume of the stock as we were buying it back. So we're kind of balancing the two of those. At the same time, I also point out our leverage is well below our target ratio here. So actually buying back equity might be helpful to get back in a little bit in line of our leverage category.

Thomas Majewski: Yeah. The thing we grapple with, we definitely saw the increase in NAV coming, so we felt it happening as it happened. I guess you can never say for sure you saw it coming. We're mindful of the discount on the share price balanced against the liquidity in the stock and the daily volume. One of the things I think I said on the last call was we backed off somewhat just due to the impact we saw on the volume of the stock as we were buying it back. So we're kind of balancing the two of those. At the same time, I also point out our leverage is well below our target ratio here. So actually buying back equity might be helpful to get back in a little bit in line of our leverage category.

Speaker #3: We're mindful of the discount on the share price, balanced against the liquidity in the stock and the daily volume. One of the things I think I said on the last call was we backed off somewhat, just due to the impact we saw on the volume of the stock as we were buying it back.

Speaker #3: So we're kind of balancing the two of those. At the same time, I would also point out our leverage is well below our target ratio here.

Speaker #3: So I think buying back equity might be helpful to get back a little bit in line in our leverage category, although we do have—I think the revolver, as of quarter end, certainly was fully undrawn.

Thomas P. Majewski: Although we do have, I think, the revolver as of quarter end, certainly was fully undrawn. Correct, Lena?

Thomas Majewski: Although we do have, I think, the revolver as of quarter end, certainly was fully undrawn. Correct, Lena?

Speaker #3: Correct, Lena?

Speaker #2: Correct.

Lena Umnova: Correct.

Speaker #3: Yeah, so we've got a couple of different tools to work on, but I am mindful of the value of liquidity in the stock, which is an important piece of the puzzle.

Lena Umnova: Yeah. We've got a couple different tools to work on, but I am mindful of the value of liquidity in the stock, which is an important piece of the puzzle that we think about. But we look at all the levers every single day.

Thomas Majewski: Yeah. We've got a couple different tools to work on, but I am mindful of the value of liquidity in the stock, which is an important piece of the puzzle that we think about. But we look at all the levers every single day.

Speaker #3: That's something we think about, but we look at all the levers every single day.

Speaker #5: I appreciate the update there. And last one for me—first, I just want to say I appreciate all the slides you guys put out every quarter.

Erik Zwick: I appreciate the update there. Last one for me. I just wanted to say I appreciate all the slides you guys put out every quarter. If I kind of look at one of the later ones in there, slide 27, which shows annual CLO trading volume. Just looking at that, the year-to-date figures for 2026 would suggest that we'd see, I guess, relative to at least 2012, a record year for this chart. Curious if you could just kind of explain the dynamics that is leading to a very strong trading year here, kind of the general upward trend, and what that means for you managing the fund. Is having greater trading liquidity an advantage? Does it potentially bring in more competitors to the market? Just curious how you view the increase here.

Speaker #5: If I kind of look at one of the later ones in there, slide 27, which shows annual CLO trading volume, just looking at the year-to-date figures for '26 would suggest that we'd see, I guess relative to at least 2012, a record year for this chart. Curious if you could just kind of explain the dynamics that have led to a very strong trading year here, kind of the general upward trend, and what that means for you managing the fund. Is having greater trading liquidity an advantage?

Speaker #5: Does it potentially bring in more competitors to the market? Just curious how you view the increase here.

Speaker #4: Yeah. I mean, we like to focus—others have had a focus on CLO equity—and it's a lot different from 14 years ago, I guess, nearly 14 years ago when we started the firm.

Dan Ko: Yeah. We like the focus that others have had on CLO equity. That's a lot different from 14 years ago, I guess, nearly 14 years ago when we started the firm. Having that liquidity allowed us to kind of reposition the portfolio this past quarter in Q2. Without actually kind of better than we anticipated in terms of kind of the levels that we were able to get. That's really due to just the liquidity that has grown within the CLO market and just there being more eyes and people that actually look at CLOs versus 2012 when we initially started. That's certainly been a benefit for the fund.

Speaker #4: And having that liquidity allowed us to kind of reposition the portfolio this past quarter, in Q2. And it actually kind of went better than we anticipated in terms of the levels that we were able to get.

Speaker #4: And that's really due to just the liquidity that has grown within the CLO market, and just there being more eyes and people that actually look at CLOs versus 2012 when we initially started.

Speaker #4: So that's certainly been a benefit for the fund.

Speaker #5: Thank you for taking my questions today.

Erik Zwick: Thank you for taking my questions today.

Speaker #4: Thanks, Eric.

Dan Ko: Thanks, Aaron.

Speaker #1: Our next question is from Timothy DeAgostino with B. Reilly Securities.

Operator: Our next question is from Timothy D'Agostino with B. Riley Securities.

Speaker #2: Yeah, hi. Good morning, and thanks for taking the questions. Regarding leverage, it's noted that it was about 12%, which is below the long-term target of 25% to 35%.

Timothy D'Agostino: Yeah, hi. Good morning. Thanks for taking the questions. Regarding leverage, it's noted that it was about 12%, which is below the long-term target of 25% to 35%. Could you just maybe help provide some color on why we're at 12% today, and then maybe the path, and how you think about getting back in line with that leverage target? Thank you.

Speaker #2: Could you just maybe help provide some color on why we're at 12% today, and then maybe the path and how you think about getting back in line with that leverage target?

Speaker #2: Thank you.

Speaker #4: Sure. So, earlier this year, we kind of retired, I guess, our most expensive preferreds, which were, I think, at 8% EICC. And just relative to the opportunities we were seeing in CLO debt, it didn't make a ton of sense to keep them outstanding.

Dan Ko: Sure. We earlier this year kind of retired, I guess our most expensive preferreds, which were, I think at 8% EICC. That there was just relative to kind of the opportunities we were seeing in CLO, that didn't make a ton of sense to keep outstanding. We have started a program of issuing kind of the EIC AA and AB, which are the convertible perpetual preferreds at 6%, which we do find very attractive. We expect that issuance to continue over the next several quarters, in fact. Our expectation is that as we raise money there, that we'll continue to increase the leverage stats. The revolver today remains undrawn.

Speaker #4: We have started a program of issuing the EIC AA and AB, which are the convertible perpetual preferreds, at 6%, which we do find very, very attractive.

Speaker #4: So we expect that issuance to continue over the next couple of several quarters. In fact, our expectation is that as we raise money there, we'll continue to improve and increase the leverage stats.

Speaker #4: But also the revolver today remains undrawn. And so that obviously, if we were to kind of fully draw that, would increase the leverage and kind of get us more in line with kind of the range the target range over the long term.

Dan Ko: That obviously if we were to kind of fully draw that would increase the leverage and kind of get us more in line with kind of the target range over the long term.

Speaker #2: Okay, great. That's helpful. And then, just a second one for me. Obviously, we just had the Eagle Point Credit Company call where we talked about other investments.

Timothy D'Agostino: Okay, great. That's helpful. Just a second one for me. Obviously, we just had the Eagle Point Credit Company call where we talked about other investments. I guess it seems that for EIC, that is a similar focus as well, just diversifying the portfolio. Could you walk us through how that sleeve of other investments for EIC is similar and/or different to what you have at ECC? Thank you.

Speaker #2: I guess it seems that for EIC, that is a similar focus as well—just diversifying the portfolio. I guess, could you walk us through how that sleeve of other investments for EIC is similar to and/or different from what you have at ECC?

Speaker #2: Thank you.

Speaker #4: Sure. No, it is similar in that there's a good amount of overlap between the ECC and EIC and their other investments.

Dan Ko: Sure. No, it is similar in that there's a good amount of overlap between the ECC and EIC kind of other investments. I guess EIC, given that it's a smaller fund, maybe has a little bit less concentration in some of these, whereas ECC has a kind of bigger position. We expect those to kind of merge or to have very similar. Not merge, sorry. That's not the right word. We expect those to have a lot of overlap in positions kind of over time in the other bucket.

Speaker #4: I guess EIC is somewhat given that it's a smaller fund, it maybe has a little bit less concentration in some of these, whereas ECC has a kind of bigger position.

Speaker #4: So we expect those to kind of merge, or to have very similar—well, not merge, sorry, that's not the right word. We expect those to have a lot of overlap in positions over time in the other bucket.

Speaker #2: Okay, great. Thank you so much for taking the questions today.

Timothy D'Agostino: Okay, great. Thank you so much for taking the questions today.

Speaker #4: Thanks, Tim.

Dan Ko: Thanks, Tim.

Speaker #1: Thank you. There are no further questions at this time. I would like to hand the floor back over to Thomas Majewski for any closing comments.

Operator: Thank you. There are no further questions at this time. I would like to hand the floor back over to Thomas Majewski for any closing comments.

Speaker #3: Great. Thank you very much for joining us today. Lena, Dan, and I appreciate your interest in the call and Eagle Point Income Company. We'll be in the office later today if anyone has any follow-up questions.

Thomas P. Majewski: Great. Thank you very much for joining us today. Lena, Dan, and I appreciate your interest in the call and Eagle Point Income Company. We will be in the office later today if anyone has any follow-up questions. Thank you very much.

Thomas Majewski: Great. Thank you very much for joining us today. Lena, Dan, and I appreciate your interest in the call and Eagle Point Income Company. We will be in the office later today if anyone has any follow-up questions. Thank you very much.

Speaker #3: Thank you very much.

Operator: Thank you. This does conclude today's conference. You may disconnect your lines at this time, and we thank you again for your participation.