Greenlight Capital Re (NASDAQ:GLRE) reported first-quarter 2026 net income of $35.8 million, as strong investment performance and an underwriting profit drove a 4.7% increase in fully diluted book value per share to $21.40, management said on the company’s earnings call.
Chief Executive Officer Greg Richardson said results were supported by a 6.8% quarterly return in the company’s Solasglas investment portfolio and underwriting income of $6.2 million, which produced a combined ratio of 96.0%.
Underwriting performance included Middle East conflict provision
Chief Financial Officer Faramarz Romer said total underwriting income was $6.2 million, and the combined ratio was 96%, which he said was 8.6 points better than the first quarter of 2025. Romer attributed the year-over-year improvement primarily to lower catastrophe and event losses and favorable loss development, partly offset by higher acquisition and expense ratios.
- Lower cat and event losses: Romer said the first-quarter 2026 combined ratio benefited from “10.5 points of improvement due to lower cat and event losses,” with cat and event losses contributing 5.8 combined ratio points versus 18.1 points in the prior-year quarter, which included California wildfire losses.
- Favorable development: Romer said favorable loss development contributed 4.1 points of improvement in the combined ratio.
- Higher costs: He said the benefit was “offset by 4 points of higher acquisition cost ratio and 1.2 points of higher expense ratio.”
Open market premiums fell as company stayed disciplined amid softening rates
Richardson said broader market trends were “unchanged with softening across most lines.” Although April 1 is not a major renewal date for the company, he noted it is a primary renewal date for Japanese business and said Greenlight Re chose to non-renew its direct Japanese catastrophe business due to “significant rate decreases,” citing limited margin potential given the portfolio’s size.
Looking ahead, Richardson said the company expects open market reinsurance written premium for 2026 to be lower than the prior year given the “soft reinsurance market,” while expecting innovation segment premium to increase due to organic growth, new opportunities, more favorable rate trends, and the company’s ability to “monitor and influence terms and conditions.”
Romer reported that the open market segment posted pre-tax income of $11.9 million, composed of underwriting income of $6.8 million and investment income of $5.1 million. Open market segment re-net written premiums declined 22.7% to $151.3 million, while net earned premiums fell 13.8%.
Romer said the earned premium decline was expected in part because it related to a casualty book the company decided to non-renew early in 2025. He added that the remaining decrease was “mostly related to downward premium adjustments on quota share specialty, property, and multi-line contracts.”
The open market combined ratio improved 11.2 points year over year to 94.8%, which Romer attributed to favorable loss development and lower catastrophe losses. He said first-quarter favorable reserve development was 2.2 percentage points versus adverse development of 3.3% in the prior-year quarter. Cat losses were $5 million tied to the Middle East conflict in the first quarter of 2026, compared with $27 million related to California wildfires in the first quarter of 2025. Romer said the improvement was partially offset by a higher acquisition cost ratio due to higher commissions on FAL programs and a higher expense ratio associated with performance-based long-term incentive compensation.
Innovation segment grew premiums but posted an underwriting loss
Romer said the innovation segment recorded an underwriting loss of $0.6 million and investment income of $1.1 million. Gross written premiums in the segment increased $20.1 million, or 73%, to $47.6 million, driven by new business and exposure growth across casualty, financial, and specialty lines, along with growth in Syndicate 3456 (presented under multi-line), according to Romer.
Greenlight Re renewed its innovation whole account retrocession program on Jan. 1, 2026, increasing the ceded share from 28.5% to 33%, Romer said. Net earned premiums for the segment rose $6.2 million, or 32%, to $25.2 million.
The innovation segment combined ratio was 102.3% in the quarter. Romer said results included 1.4 points of adverse prior development compared with 3 points of favorable development in the first quarter of 2025. He added that the attritional loss ratio was 4.4 points higher, “mainly related to a financial lines program where the past loss experience warranted a higher current year loss ratio.” The segment’s expense ratio was unchanged at 8.2% despite the increase in earned premiums, and Romer said the company continues investing in talent and technology in preparation for future growth.
Investment results: Solasglas up 6.8% as shorts and macro contributed
Chairman David Einhorn discussed investment performance, saying the Solasglas fund returned 6.8% in the quarter, with the long portfolio contributing 1%, the short portfolio 5.7%, and macro 1.2%. During the same period, Einhorn noted the S&P 500 declined 4.4%.
Einhorn said the largest positive contributors included long positions in gold, Acadia Healthcare, and DHT Holdings, while the largest detractors included a macro position in short-term interest rates and long positions in Kyndryl Holdings and Graphic Packaging.
- Gold: Einhorn said gold was the largest positive contributor as its price advanced 8% in the quarter, citing gains in both physical holdings and call options. He said the fund took some profits, lowering exposure and preserving most gains as gold declined in March.
- Acadia Healthcare: Einhorn said shares advanced 65% after the company replaced its CEO and brought back a former CEO. He said if the company improves occupancy to target levels, “we believe annual earnings per share can double.”
- DHT Holdings: Einhorn said shares rose 53% as tanker day rates increased, and he said elevated rates “we expect will allow the company to pay a dividend that is nearly quadruple this year.”
- SOFR futures: Einhorn said the largest detractor was a long SOFR futures position, as the market questioned the Federal Reserve’s ability to cut rates after oil prices spiked. He said the firm maintained the position, viewing the oil shock as a headwind to growth that could ultimately create “a viable pathway” to lower rates under the incoming Fed chair.
- Kyndryl: Einhorn said the stock declined 58% and that the firm exited its remaining position during the quarter after it became more difficult for the company to win new business.
- Graphic Packaging: Einhorn said shares declined 33% after the company missed earnings expectations and lowered guidance, and he cited cost overruns at a new paper mill and CEO changes. He said the shares appeared “extremely cheap” relative to “reasonable mid-cycle operating results.”
Einhorn also said the fund initiated a medium-sized position in Versant Media Group after its spin-off from Comcast, describing selling pressure from distribution and index removals. He said the stock traded at “under 4x adjusted EBITDA” and at an implied cash flow yield that “we believe will allow the company to return almost all its entire market cap to shareholders within four years.”
On positioning, Einhorn said the portfolio was cautiously set ahead of the war with relatively low gross and net exposure. He said net exposure ended the quarter at about 41% (roughly flat versus about 40% at year-end 2025). He added that Solasglas returned 0.4% in April, bringing the year-to-date 2026 return to 7.2%, with net exposure at approximately 30% at the end of April. Einhorn said the firm continued to prioritize capital preservation and maintain “some dry powder.”
Share repurchases and capital allocation
Richardson said the company had returned $15 million of capital to shareholders year to date via share repurchases and reiterated management’s view that sustained underwriting and investment performance should ultimately be reflected in the share price. Romer said Greenlight Re repurchased 298,701 shares for $5 million in the first quarter at an average price of $16.70 per share, and then repurchased an additional $9.5 million of shares in April, bringing year-to-date repurchases to $14.5 million.
Romer also said the board approved a new $40 million share repurchase authorization on April 28, effective May 15, 2026, and expiring at the end of May 2027.
No analyst questions were asked during the call’s question-and-answer session.
About Greenlight Capital Re (NASDAQ:GLRE)
Greenlight Capital Re Ltd. (NASDAQ: GLRE) is a Bermuda‐incorporated reinsurer externally managed by Greenlight Capital Re Services Ltd., a subsidiary of Greenlight Capital, Inc Since its formation in 2016 and subsequent initial public offering in 2017, the company has focused on providing customized reinsurance solutions to insurers worldwide. Greenlight Capital Re operates as an independent, publicly traded entity, leveraging the investment expertise and underwriting rigor that underpin its parent’s investment platform.
The company’s core business activities encompass both treaty and facultative reinsurance across a broad spectrum of property and casualty lines.
