10-Q

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2026

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ______ to ______

Commission file number: 001-34580

FIRST AMERICAN FINANCIAL CORPORATION

(Exact name of registrant as specified in its charter)


Delaware		26-1911571
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

1 First American Way, Santa Ana, California		92707-5913
(Address of principal executive offices)		(Zip Code)

(714) 250-3000

(Registrant’s telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common stock, $0.00001 par value	FAF	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

On October 19, 2026 there were 102.1 million shares of common stock outstanding.

FIRST AMERICAN FINANCIAL CORPORATION

AND SUBSIDIARY COMPANIES

INFORMATION INCLUDED IN REPORT


PART I: FINANCIAL INFORMATION

Item 1.	Financial Statements (unaudited)

	A. Condensed Consolidated Balance Sheets as of September 30, 2026 and December 31, 2025	5

	B. Condensed Consolidated Statements of Income for the three and nine months ended September 30, 2026 and 2025	6

	C. Condensed Consolidated Statements of Comprehensive Income for the three and nine months ended September 30, 2026 and 2025	7

	D. Condensed Consolidated Statements of Stockholders’ Equity for each of the quarters within the nine months ended September 30, 2026 and 2025	8

	E. Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2026 and 2025	10

	F. Notes to Condensed Consolidated Financial Statements	11

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	34

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	43

Item 4.	Controls and Procedures	43

PART II: OTHER INFORMATION

Item 1.	Legal Proceedings	44

Item 1A.	Risk Factors	44

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	45

Item 3.	Defaults Upon Senior Securities	45

Item 4.	Mine Safety Disclosures	45

Item 5.	Other Information	45

Item 6.	Exhibits	46

THIS QUARTERLY REPORT ON FORM 10-Q CONTAINS FORWARD-LOOKING STATEMENTS WITHIN THE MEANING OF SECTION 27A OF THE SECURITIES ACT OF 1933, AS AMENDED, AND SECTION 21E OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. THESE FORWARD-LOOKING STATEMENTS CAN BE IDENTIFIED BY THE FACT THAT THEY DO NOT RELATE STRICTLY TO HISTORICAL OR CURRENT FACTS AND MAY CONTAIN THE WORDS “BELIEVE,” “ANTICIPATE,” “EXPECT,” “INTEND,” “PLAN,” “PREDICT,” “ESTIMATE,” “PROJECT,” “WILL BE,” “WILL CONTINUE,” “WILL LIKELY RESULT,” OR OTHER SIMILAR WORDS AND PHRASES OR FUTURE OR CONDITIONAL VERBS SUCH AS “WILL,” “MAY,” “MIGHT,” “SHOULD,” “WOULD,” OR “COULD.” THESE FORWARD-LOOKING STATEMENTS INCLUDE, WITHOUT LIMITATION, STATEMENTS REGARDING FUTURE OPERATIONS, PERFORMANCE, FINANCIAL CONDITION, PROSPECTS, PLANS AND STRATEGIES. THESE FORWARD-LOOKING STATEMENTS ARE BASED ON CURRENT EXPECTATIONS AND ASSUMPTIONS THAT MAY PROVE TO BE INCORRECT.

•

INTEREST RATE FLUCTUATIONS;

•

CHANGES IN CONDITIONS OF THE REAL ESTATE MARKETS;

•

VOLATILITY IN THE CAPITAL MARKETS;

•

UNFAVORABLE ECONOMIC CONDITIONS;

•

IMPAIRMENTS IN THE COMPANY’S GOODWILL OR OTHER INTANGIBLE ASSETS;

•

FAILURES AT FINANCIAL INSTITUTIONS WHERE THE COMPANY DEPOSITS FUNDS;

•

REGULATORY OVERSIGHT AND CHANGES IN APPLICABLE LAWS AND GOVERNMENT REGULATIONS, INCLUDING PRIVACY AND DATA PROTECTION LAWS;

•

HEIGHTENED SCRUTINY BY LEGISLATORS AND REGULATORS OF THE COMPANY’S TITLE INSURANCE AND SERVICES SEGMENT AND CERTAIN OTHER OF THE COMPANY’S BUSINESSES;

•

REGULATION OF TITLE INSURANCE RATES;

•

LIMITATIONS ON ACCESS TO PUBLIC RECORDS AND OTHER DATA;

•

SEVERE WEATHER CONDITIONS, HEALTH CRISES, TERRORIST ATTACKS AND OTHER CATASTROPHES;

•

CHANGES IN RELATIONSHIPS WITH LARGE MORTGAGE LENDERS AND GOVERNMENT-SPONSORED ENTERPRISES;

•

CHANGES IN MEASURES OF THE STRENGTH OF THE COMPANY’S TITLE INSURANCE UNDERWRITERS, INCLUDING RATINGS AND STATUTORY CAPITAL AND SURPLUS;

•

LOSSES IN THE COMPANY’S INVESTMENT PORTFOLIO OR VENTURE INVESTMENT PORTFOLIO;

•

MATERIAL VARIANCE BETWEEN ACTUAL AND EXPECTED CLAIMS EXPERIENCE;

•

PROVISION OF CAPITAL TO SUBSIDIARIES THAT COULD AFFECT THE COMPANY’S LIQUIDITY POSITION;

•

DEFALCATIONS, INCREASED CLAIMS OR OTHER COSTS AND EXPENSES ATTRIBUTABLE TO THE COMPANY’S USE OF TITLE AGENTS;

•

ANY INADEQUACY IN THE COMPANY’S RISK MANAGEMENT FRAMEWORK OR USE OF MODELS;

•

SYSTEMS DAMAGE, FAILURES, INTERRUPTIONS, CYBERATTACKS AND INTRUSIONS, OR UNAUTHORIZED DATA DISCLOSURES;

•

INNOVATION EFFORTS OF THE COMPANY AND OTHER INDUSTRY PARTICIPANTS AND ANY RELATED MARKET DISRUPTION;

•

ERRORS AND FRAUD INVOLVING THE TRANSFER OF FUNDS;

•

FAILURES TO RECRUIT AND RETAIN QUALIFIED EMPLOYEES;

•

THE COMPANY’S USE OF A GLOBAL WORKFORCE;

•

INABILITY OF THE COMPANY TO FULFILL PARENT COMPANY OBLIGATIONS AND/OR PAY DIVIDENDS;

•

INABILITY TO REALIZE ANTICIPATED SYNERGIES OR PRODUCE RETURNS THAT JUSTIFY INVESTMENT IN ACQUIRED BUSINESSES;

•

A REDUCTION IN THE DEPOSITS AT THE COMPANY’S FEDERAL SAVINGS BANK SUBSIDIARY;

•

CLAIMS OF INFRINGEMENT OR INABILITY TO ADEQUATELY PROTECT THE COMPANY’S INTELLECTUAL PROPERTY; AND

•

OTHER FACTORS DESCRIBED IN THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDED DECEMBER 31, 2025, INCLUDING UNDER THE CAPTION RISK FACTORS IN ITEM 1A OF PART I, AND IN SUBSEQUENT FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION, INCLUDING UNDER THE CAPTION RISK FACTORS IN ITEM 1A OF PART II AND ELSEWHERE IN THIS QUARTERLY REPORT ON FORM 10-Q.

THE FORWARD-LOOKING STATEMENTS SPEAK ONLY AS OF THE DATE THEY ARE MADE. THE COMPANY DOES NOT UNDERTAKE TO UPDATE FORWARD-LOOKING STATEMENTS TO REFLECT CIRCUMSTANCES OR EVENTS THAT OCCUR AFTER THE DATE THE FORWARD-LOOKING STATEMENTS ARE MADE.

PART I: FINANCIAL INFORMATION

Item 1. Financial Statements.

FIRST AMERICAN FINANCIAL CORPORATION

AND SUBSIDIARY COMPANIES

Condensed Consolidated Balance Sheets

(in millions, except par values)

(unaudited)


	September 30, 2026			December 31, 2025
Assets
Cash and cash equivalents	$	1,731.1		$	1,387.3
Accounts and accrued income receivable, less allowance for credit losses of $23.6 and $23.9		456.1			432.6
Income taxes receivable		175.8			65.0
Investments:
Deposits with banks		106.8			78.5
Debt securities (amortized cost of $10,535.2 and $8,656.7; pledged of $154.8 and $170.3)		9,762.6			8,466.7
Equity securities		868.1			849.1
		10,737.5			9,394.3
Secured financings receivable		930.3			986.1
Property and equipment, net		655.6			682.3
Operating lease assets		184.5			205.7
Title plants and other indexes		694.2			686.7
Deferred income taxes		9.4			9.4
Goodwill		1,818.3			1,819.3
Other intangible assets, net		77.3			100.0
Other assets		512.7			460.1
	$	17,982.8		$	16,228.8
Liabilities and Equity
Deposits	$	7,286.0		$	5,292.7
Accounts payable and accrued liabilities		1,022.8			1,002.7
Deferred revenue		226.7			214.0
Reserve for known and incurred but not reported claims		1,134.6			1,169.6
Income taxes payable		39.3			42.7
Deferred income taxes		312.7			312.7
Operating lease liabilities		198.2			218.2
Secured financings payable		807.5			906.5
Notes and contracts payable		1,546.8			1,545.4
		12,574.6			10,704.5
Commitments and contingencies (Note 16)
Stockholders’ equity:
Preferred stock, $0.00001 par value; Authorized—0.5 shares; Outstanding—none		—			—
Common stock, $0.00001 par value; Authorized—300.0 shares; Outstanding—102.2 shares and 102.0 shares		—			—
Additional paid-in capital		1,741.7			1,744.4
Retained earnings		4,354.4			4,011.8
Accumulated other comprehensive loss		(709.2	)		(256.7	)
Total stockholders’ equity		5,386.9			5,499.5
Noncontrolling interests		21.3			24.8
Total equity		5,408.2			5,524.3
	$	17,982.8		$	16,228.8

See notes to condensed consolidated financial statements.

FIRST AMERICAN FINANCIAL CORPORATION

AND SUBSIDIARY COMPANIES

Condensed Consolidated Statements of Income

(in millions, except per share amounts)

(unaudited)


	Three Months Ended					Nine Months Ended
	September 30,					September 30,
	2026			2025		2026			2025
Revenues
Direct premiums and escrow fees	$	749.8		$	708.0	$	2,204.1		$	1,973.3
Agent premiums		868.4			798.8		2,447.5			2,169.9
Information and other		297.9			282.0		880.8			794.3
Net investment income		170.1			163.8		506.2			459.2
Net investment gains (losses) (realized losses of $(1.4), $(2.0), $(4.2), $(8.9))		(1.6	)		26.3		1.3			5.8
		2,084.6			1,978.9		6,039.9			5,402.5
Expenses
Personnel costs		597.4			574.9		1,779.9			1,652.7
Premiums retained by agents		695.6			640.1		1,956.4			1,739.1
Other operating expenses		343.6			309.2		1,006.1			896.9
Provision for policy losses and other claims		95.1			90.8		260.2			242.8
Depreciation and amortization		54.7			54.8		162.9			160.3
Premium taxes		24.2			22.2		67.1			58.8
Interest		46.4			39.9		134.0			113.1
		1,857.0			1,731.9		5,366.6			4,863.7
Income before income taxes		227.6			247.0		673.3			538.8
Income taxes		51.0			57.1		152.8			127.0
Net income		176.6			189.9		520.5			411.8
Less: Net income (loss) attributable to noncontrolling interests		(0.4	)		0.3		(0.1	)		1.9
Net income attributable to the Company	$	177.0		$	189.6	$	520.6		$	409.9
Net income per share attributable to the Company's stockholders (Note 10):
Basic	$	1.72		$	1.84	$	5.06		$	3.96
Diluted	$	1.72		$	1.84	$	5.04		$	3.95
Cash dividends per share	$	0.61		$	0.55	$	1.71		$	1.63
Weighted-average common shares outstanding (Note 10):
Basic		102.7			102.8		102.8			103.5
Diluted		103.2			103.1		103.2			103.8

See notes to condensed consolidated financial statements.

FIRST AMERICAN FINANCIAL CORPORATION

AND SUBSIDIARY COMPANIES

Condensed Consolidated Statements of Comprehensive Income

(in millions)

(unaudited)


	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2026			2025			2026			2025
Net income	$	176.6		$	189.9		$	520.5		$	411.8
Other comprehensive income (loss), net of tax:
Change in unrealized losses on debt securities		(364.0	)		70.8			(436.6	)		182.1
Change in foreign currency translation adjustment		2.4			(11.7	)		(17.0	)		27.1
Change in pension benefit adjustment		0.4			0.3			1.1			1.0
Total other comprehensive income (loss), net of tax		(361.2	)		59.4			(452.5	)		210.2
Comprehensive income (loss)		(184.6	)		249.3			68.0			622.0
Less: Comprehensive income (loss) attributable to noncontrolling interests		(0.4	)		0.3			(0.1	)		1.9
Comprehensive income (loss) attributable to the Company	$	(184.2	)	$	249.0		$	68.1		$	620.1

See notes to condensed consolidated financial statements.

FIRST AMERICAN FINANCIAL CORPORATION

AND SUBSIDIARY COMPANIES

Condensed Consolidated Statements of Stockholders’ Equity

(in millions)

(unaudited)


	First American Financial Corporation Stockholders
	Shares			Common stock		Additional paid-in capital			Retained earnings			Accumulated other comprehensive income (loss)			Total stockholders’ equity			Noncontrolling interests			Total
Balance at December 31, 2025		102.0		$	—	$	1,744.4		$	4,011.8		$	(256.7	)	$	5,499.5		$	24.8		$	5,524.3
Net income (loss) for the three months ended March 31, 2026		—			—		—			125.1			—			125.1			(0.3	)		124.8
Dividends on common shares		—			—		—			(56.2	)		—			(56.2	)		—			(56.2	)
Repurchases of Company shares		(0.6	)		—		(33.5	)		—			—			(33.5	)		—			(33.5	)
Shares issued in connection with share-based compensation		0.7			—		(5.4	)		(1.2	)		—			(6.6	)		—			(6.6	)
Share-based compensation		—			—		27.1			—			—			27.1			—			27.1
Net activity related to noncontrolling interests		—			—		—			—			—			—			(1.9	)		(1.9	)
Other comprehensive loss		—			—		—			—			(65.8	)		(65.8	)		—			(65.8	)
Balance at March 31, 2026		102.1			—		1,732.6			4,079.5			(322.5	)		5,489.6			22.6			5,512.2
Net income for the three months ended June 30, 2026		—			—		—			218.5			—			218.5			0.6			219.1
Dividends on common shares		—			—		—			(56.1	)		—			(56.1	)		—			(56.1	)
Repurchases of Company shares		(0.3	)		—		(20.5	)		—			—			(20.5	)		—			(20.5	)
Shares issued in connection with share-based compensation		0.2			—		2.6			(1.1	)		—			1.5			—			1.5
Share-based compensation		—			—		13.3			—			—			13.3			—			13.3
Net activity related to noncontrolling interests		—			—		—			—			—			—			(0.2	)		(0.2	)
Other comprehensive loss		—			—		—			—			(25.5	)		(25.5	)		—			(25.5	)
Balance at June 30, 2026		102.0			—		1,728.0			4,240.8			(348.0	)		5,620.8			23.0			5,643.8
Net income (loss) for the three months ended September 30, 2026		—			—		—			177.0			—			177.0			(0.4	)		176.6
Dividends on common shares		—			—		—			(62.3	)		—			(62.3	)		—			(62.3	)
Repurchases of Company shares		—			—		(1.5	)		—			—			(1.5	)		—			(1.5	)
Shares issued in connection with share-based compensation		0.2			—		3.9			(1.1	)		—			2.8			—			2.8
Share-based compensation		—			—		11.3			—			—			11.3			—			11.3
Net activity related to noncontrolling interests		—			—		—			—			—			—			(1.3	)		(1.3	)
Other comprehensive loss		—			—		—			—			(361.2	)		(361.2	)		—			(361.2	)
Balance at September 30, 2026		102.2		$	—	$	1,741.7		$	4,354.4		$	(709.2	)	$	5,386.9		$	21.3		$	5,408.2

See notes to condensed consolidated financial statements.

FIRST AMERICAN FINANCIAL CORPORATION

AND SUBSIDIARY COMPANIES

Condensed Consolidated Statements of Stockholders’ Equity – (Continued)

(in millions)

(unaudited)


	First American Financial Corporation Stockholders
	Shares			Common stock		Additional paid-in capital			Retained earnings			Accumulated other comprehensive income (loss)			Total stockholders’ equity			Noncontrolling interests		Total
Balance at December 31, 2024		103.0		$	—	$	1,787.6		$	3,617.3		$	(496.4	)	$	4,908.5		$	18.5	$	4,927.0
Net income for the three months ended March 31, 2025		—			—		—			74.2			—			74.2			0.6		74.8
Dividends on common shares		—			—		—			(55.7	)		—			(55.7	)		—		(55.7	)
Repurchases of Company shares		(0.4	)		—		(28.2	)		—			—			(28.2	)		—		(28.2	)
Shares issued in connection with share-based compensation		0.6			—		(5.7	)		(1.0	)		—			(6.7	)		—		(6.7	)
Share-based compensation		—			—		30.6			—			—			30.6			—		30.6
Net activity related to noncontrolling interests		—			—		—			—			—			—			2.5		2.5
Other comprehensive income		—			—		—			—			96.6			96.6			—		96.6
Balance at March 31, 2025		103.2			—		1,784.3			3,634.8			(399.8	)		5,019.3			21.6		5,040.9
Net income for the three months ended June 30, 2025		—			—		—			146.1			—			146.1			1.0		147.1
Dividends on common shares		—			—		—			(55.3	)		—			(55.3	)		—		(55.3	)
Repurchases of Company shares		(1.1	)		—		(60.5	)		—			—			(60.5	)		—		(60.5	)
Shares issued in connection with share-based compensation		0.2			—		6.3			(1.1	)		—			5.2			—		5.2
Share-based compensation		—			—		17.2			—						17.2			—		17.2
Net activity related to noncontrolling interests		—			—		—			—			—			—			0.5		0.5
Other comprehensive income		—			—		—			—			54.2			54.2			—		54.2
Balance at June 30, 2025		102.3			—		1,747.3			3,724.5			(345.6	)		5,126.2			23.1		5,149.3
Net income for the three months ended September 30, 2025		—			—		—			189.6			—			189.6			0.3		189.9
Dividends on common shares		—			—		—			(56.0	)		—			(56.0	)		—		(56.0	)
Repurchases of Company shares		(0.6	)		—		(33.6	)		—			—			(33.6	)		—		(33.6	)
Shares issued in connection with share-based compensation		0.2			—		4.7			(1.0	)		—			3.7			—		3.7
Share-based compensation		—			—		11.8			—			—			11.8			—		11.8
Net activity related to noncontrolling interests		—			—		—			—			—			—			0.7		0.7
Other comprehensive income		—			—		—			—			59.4			59.4			—		59.4
Balance at September 30, 2025		101.9		$	—	$	1,730.2		$	3,857.1		$	(286.2	)	$	5,301.1		$	24.1	$	5,325.2

See notes to condensed consolidated financial statements.

FIRST AMERICAN FINANCIAL CORPORATION

AND SUBSIDIARY COMPANIES

Condensed Consolidated Statements of Cash Flows

(in millions)

(unaudited)


	Nine Months Ended September 30,
	2026			2025
Cash flows from operating activities:
Net income	$	520.5		$	411.8
Adjustments to reconcile net income to cash provided by operating activities:
Provision for policy losses and other claims		260.2			242.8
Depreciation and amortization		162.9			160.3
Amortization of premiums and accretion of discounts on debt securities, net		(45.5	)		(34.0	)
Net investment gains		(1.3	)		(5.8	)
Share-based compensation		51.7			59.6
Equity in earnings of affiliates, net		(10.1	)		(7.9	)
Dividends from equity method investments		10.7			6.1
Changes in assets and liabilities excluding effects of acquisitions and noncash transactions:
Claims paid, including assets acquired, net of recoveries		(287.1	)		(261.4	)
Net change in income tax accounts		32.4			85.7
Increase in accounts and accrued income receivable		(26.1	)		(71.9	)
Decrease in accounts payable and accrued liabilities		(59.5	)		(3.4	)
Increase in deferred revenue		12.7			11.0
Other, net		(21.3	)		(11.4	)
Cash provided by operating activities		600.2			581.5
Cash flows from investing activities:
Acquisitions/dispositions, net of cash acquired/divested		(0.2	)		(2.4	)
Net (increase) decrease in deposits with banks		(27.6	)		8.0
Purchases of debt securities		(3,212.2	)		(1,935.4	)
Proceeds from sales of debt securities		782.8			747.4
Proceeds from maturities of debt securities		600.2			486.5
Purchases of equity securities		(48.2	)		(31.9	)
Proceeds from sales of equity securities		30.2			46.6
Advances on notes receivable		(38.1	)		(10.4	)
Collections on notes receivable		4.4			2.2
Advances under secured financing agreements		(40,838.0	)		(30,093.1	)
Collections of secured financings receivable		40,893.8			29,612.1
Capital expenditures		(118.9	)		(143.5	)
Proceeds from sales of property and equipment		—			0.6
Proceeds from insurance settlement		—			1.9
Cash used for investing activities		(1,971.8	)		(1,311.4	)
Cash flows from financing activities:
Net change in deposits		1,993.3			1,769.8
Borrowings under secured financing agreements		39,476.1			29,284.9
Repayments of secured financings payable		(39,575.1	)		(28,850.3	)
Repayments of other notes and contracts payable		(2.8	)		(2.9	)
Net activity related to noncontrolling interests		(3.4	)		(2.4	)
Net (payments) proceeds in connection with share-based compensation		(2.3	)		2.9
Repurchases of Company shares		(55.5	)		(122.3	)
Payments of cash dividends		(112.3	)		(167.0	)
Cash provided by financing activities		1,718.0			1,912.7
Effect of exchange rate changes on cash		(2.6	)		10.6
Net increase in cash and cash equivalents		343.8			1,193.4
Cash and cash equivalents—Beginning of period		1,387.3			1,718.1
Cash and cash equivalents—End of period	$	1,731.1		$	2,911.5
Supplemental information:
Cash paid (received) during the period for:
Interest	$	136.5		$	114.7
Premium taxes	$	77.5		$	61.4
Income taxes paid	$	120.7		$	56.7
Income tax refunds	$	(0.3	)	$	(15.4	)

See notes to condensed consolidated financial statements.

FIRST AMERICAN FINANCIAL CORPORATION
AND SUBSIDIARY COMPANIES

Notes to Condensed Consolidated Financial Statements
(unaudited)

Note 1 – Basis of Condensed Consolidated Financial Statements

Basis of Presentation

The condensed consolidated financial information included in this report has been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and Article 10 of Securities and Exchange Commission Regulation S-X. The principles for condensed interim financial information do not require the inclusion of all the information and footnotes required by GAAP for complete financial statements. Therefore, these financial statements should be read in conjunction with the First American Financial Corporation (the “Company”) Annual Report on Form 10-K for the year ended December 31, 2025. The condensed consolidated financial statements included herein are unaudited; however, in the opinion of management, they contain all normal recurring adjustments necessary for a fair statement of the consolidated results for the interim periods. All material intercompany transactions and balances have been eliminated upon consolidation.

Pending Accounting Pronouncements

In September 2025, the FASB issued updated guidance intended to modernize the accounting for internal-use software costs. The updated guidance better aligns the accounting with how software is currently developed by making the guidance more relevant for agile and iterative development methods. Under the updated guidance, an entity is required to begin capitalizing software costs when management has authorized and committed to funding a software project and it is probable that the project will be completed and the software will be used to perform the function intended. The updated guidance is effective for interim and annual reporting periods beginning after December 15, 2027, with early adoption permitted, and can be applied prospectively, retrospectively, or through a modified prospective method in the Company's financial statements. The Company does not expect the adoption of this guidance to have a material impact on its condensed consolidated financial statements.

In November 2024, the FASB issued updated guidance intended to improve financial reporting by requiring entities to disclose additional information in the notes to the financial statements about specific expense categories within the income statement. The updated guidance is effective for annual reporting periods beginning after December 15, 2026 and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted. The updated disclosures can be applied either prospectively or retrospectively in the Company's financial statements. Except for the disclosure requirements, the Company does not expect the adoption of this guidance to have a material impact on its condensed consolidated financial statements.

FIRST AMERICAN FINANCIAL CORPORATION
AND SUBSIDIARY COMPANIES
Notes to Condensed Consolidated Financial Statements – (Continued)
(unaudited)

Note 2 –Trust Assets, Escrow and Other Deposits

The Company administers escrow deposits as a service to customers in its direct title operations. Escrow deposits totaled $10.0 billion and $9.3 billion at September 30, 2026 and December 31, 2025, respectively, of which $4.1 billion and $3.7 billion, respectively, were held at First American Trust, FSB (“FA Trust”). The remaining deposits were held at third-party financial institutions. Escrow deposits held at third-party financial institutions are not considered assets of the Company and are not included in the accompanying condensed consolidated balance sheets. All such amounts are placed in deposit accounts insured, up to applicable limits, by the Federal Deposit Insurance Corporation. The Company could be held contingently liable for the disposition of these assets.

Trust assets administered by FA Trust totaled $6.1 billion and $5.6 billion at September 30, 2026 and December 31, 2025, respectively, of which $155.2 million and $173.9 million, respectively, were held at FA Trust. The remaining trust assets were held at third-party financial institutions. Trust assets administered by FA Trust and held at third-party institutions are fiduciary client assets that are not considered assets of the Company and are not included in the accompanying condensed consolidated balance sheets. The Company could be held contingently liable if FA Trust were to breach any of its fiduciary duties.

In conducting its operations, the Company often holds customers’ assets in escrow, pending completion of real estate transactions and, as a result, the Company has ongoing programs for realizing economic benefits with various financial institutions. The results from these programs are included as either income or as a reduction in expense, as appropriate, in the condensed consolidated statements of income based on the nature of the arrangement and benefit received.

The Company facilitates tax-deferred property exchanges for customers pursuant to Section 1031 of the Internal Revenue Code and tax-deferred reverse exchanges pursuant to Revenue Procedure 2000-37. As a facilitator and intermediary, the Company holds the proceeds from sales transactions and takes temporary title to property identified by the customer to be acquired with such proceeds. Upon the completion of each such exchange, the identified property is transferred to the customer or, if the exchange does not take place, an amount equal to the sales proceeds or, in the case of a reverse exchange, title to the property held by the Company is transferred to the customer. Like-kind exchange funds administered by the Company totaled $2.6 billion and $2.7 billion at September 30, 2026 and December 31, 2025, respectively, of which $1.1 billion and $93.6 million, respectively, were held at FA Trust. The like-kind exchange deposits held at third-party financial institutions are not included in the accompanying condensed consolidated balance sheets as the proceeds and property are not considered assets of the Company due to the structure utilized to facilitate these transactions. All such amounts are placed in deposit accounts insured, up to applicable limits, by the Federal Deposit Insurance Corporation. The Company could be held contingently liable to the customer for the transfers of property, disbursements of proceeds and the returns on such proceeds.

In conducting its residential mortgage loan subservicing operations, the Company administers cash deposits on behalf of its clients. Cash deposits totaled $2.1 billion and $1.6 billion at September 30, 2026 and December 31, 2025, respectively, of which $1.5 billion and $1.0 billion, respectively, were held at FA Trust. The remaining deposits were held at third-party financial institutions. Cash deposits held at third-party financial institutions are not considered assets of the Company and, therefore, are not included in the accompanying condensed consolidated balance sheets. All such amounts are placed in deposit accounts insured, up to applicable limits, by the Federal Deposit Insurance Corporation. The Company could be held contingently liable for the disposition of these assets. In connection with certain accounts, the Company has ongoing programs for realizing economic benefits with various financial institutions whereby it earns economic benefits either as income or as a reduction in expense. In connection with a mortgage loan subservicing agreement, the Company maintains certain debt securities on deposit with a fair value of $52.2 million at September 30, 2026 for which it has provided a secured interest as collateral.

Deposit balances held at FA Trust are temporarily invested in cash and cash equivalents and debt securities, with offsetting liabilities included in deposits in the accompanying condensed consolidated balance sheets.

FIRST AMERICAN FINANCIAL CORPORATION
AND SUBSIDIARY COMPANIES
Notes to Condensed Consolidated Financial Statements – (Continued)
(unaudited)

Note 3 – Debt Securities

Investments in debt securities, classified as available-for-sale, are as follows:


	Amortized		Gross unrealized					Estimated
(in millions)	cost		Gains		Losses			fair value
September 30, 2026
U.S. Treasury bonds	$	257.0	$	—	$	(9.5	)	$	247.5
Municipal bonds		1,146.3		0.6		(117.7	)	$	1,029.2
Foreign government bonds		241.8		0.3		(5.8	)	$	236.3
Governmental agency bonds		474.3		—		(30.3	)	$	444.0
Governmental agency mortgage-backed securities		6,623.2		0.6		(529.6	)	$	6,094.2
U.S. corporate debt securities		1,299.1		0.8		(65.6	)	$	1,234.3
Foreign corporate debt securities		493.5		1.2		(17.6	)	$	477.1
	$	10,535.2	$	3.5	$	(776.1	)	$	9,762.6
December 31, 2025
U.S. Treasury bonds	$	244.2	$	1.0	$	(1.6	)	$	243.6
Municipal bonds		1,003.5		9.9		(53.3	)		960.1
Foreign government bonds		239.4		1.1		(5.3	)		235.2
Governmental agency bonds		268.3		0.3		(7.6	)		261.0
Governmental agency mortgage-backed securities		5,401.9		41.9		(183.0	)		5,260.8
U.S. corporate debt securities		1,032.8		15.7		(13.7	)		1,034.8
Foreign corporate debt securities		466.6		9.5		(4.9	)		471.2
	$	8,656.7	$	79.4	$	(269.4	)	$	8,466.7

Sales of debt securities resulted in realized gains of $0.7 million and $3.6 million, realized losses of $2.1 million and $7.8 million and proceeds of $239.1 million and $782.8 million for the three and nine months ended September 30, 2026, respectively. Sales of debt securities resulted in realized gains of $1.7 million and $4.2 million, realized losses of $3.7 million and $13.0 million and proceeds of $240.4 million and $747.4 million for the three and nine months ended September 30, 2025, respectively.

FIRST AMERICAN FINANCIAL CORPORATION
AND SUBSIDIARY COMPANIES
Notes to Condensed Consolidated Financial Statements – (Continued)
(unaudited)

Investments in debt securities in an unrealized loss position, and their respective length of time in such position, are as follows:


	Less than 12 months					12 months or longer					Total
(in millions)	Estimated fair value		Unrealized losses			Estimated fair value		Unrealized losses			Estimated fair value		Unrealized losses
September 30, 2026
U.S. Treasury bonds	$	230.1	$	(8.5	)	$	17.2	$	(1.0	)	$	247.3	$	(9.5	)
Municipal bonds		619.2		(36.6	)		385.9		(81.1	)		1,005.1		(117.7	)
Foreign government bonds		148.2		(1.9	)		34.9		(3.9	)		183.1		(5.8	)
Governmental agency bonds		419.2		(23.8	)		24.8		(6.5	)		444.0		(30.3	)
Governmental agency mortgage-backed securities		4,850.6		(294.9	)		1,196.9		(234.7	)		6,047.5		(529.6	)
U.S. corporate debt securities		1,021.8		(48.2	)		72.1		(17.4	)		1,093.9		(65.6	)
Foreign corporate debt securities		361.7		(11.6	)		39.0		(6.0	)		400.7		(17.6	)
	$	7,650.8	$	(425.5	)	$	1,770.8	$	(350.6	)	$	9,421.6	$	(776.1	)
December 31, 2025
U.S. Treasury bonds	$	61.7	$	(0.3	)	$	36.3	$	(1.3	)	$	98.0	$	(1.6	)
Municipal bonds		118.6		(1.1	)		451.3		(52.2	)		569.9		(53.3	)
Foreign government bonds		76.2		(0.3	)		59.8		(5.0	)		136.0		(5.3	)
Governmental agency bonds		210.6		(1.5	)		28.9		(6.1	)		239.5		(7.6	)
Governmental agency mortgage-backed securities		988.8		(9.8	)		1,479.1		(173.2	)		2,467.9		(183.0	)
U.S. corporate debt securities		169.4		(0.8	)		101.2		(12.9	)		270.6		(13.7	)
Foreign corporate debt securities		32.3		(0.2	)		69.0		(4.7	)		101.3		(4.9	)
	$	1,657.6	$	(14.0	)	$	2,225.6	$	(255.4	)	$	3,883.2	$	(269.4	)

Based on the Company’s review of its debt securities in an unrealized loss position, it determined that the losses were due to non-credit factors and, therefore, it does not consider these securities to be credit impaired at September 30, 2026.

FIRST AMERICAN FINANCIAL CORPORATION
AND SUBSIDIARY COMPANIES
Notes to Condensed Consolidated Financial Statements – (Continued)
(unaudited)

Investments in debt securities at September 30, 2026, by contractual maturities, are as follows:


(in millions)	Due in one year or less		Due after one through five years		Due after five through ten years		Due after ten years		Total
U.S. Treasury bonds
Amortized cost	$	39.8	$	162.2	$	50.9	$	4.1	$	257.0
Estimated fair value	$	39.7	$	157.1	$	47.6	$	3.1	$	247.5
Municipal bonds
Amortized cost		7.2		149.4		574.0		415.7		1,146.3
Estimated fair value		7.2		141.3		509.4		371.3		1,029.2
Foreign government bonds
Amortized cost		93.2		101.8		33.6		13.2		241.8
Estimated fair value		93.4		98.0		33.1		11.8		236.3
Governmental agency bonds
Amortized cost		—		0.8		272.9		200.6		474.3
Estimated fair value		—		0.8		259.8		183.4		444.0
U.S. corporate debt securities
Amortized cost		3.1		590.7		533.2		172.1		1,299.1
Estimated fair value		3.1		576.8		505.3		149.1		1,234.3
Foreign corporate debt securities
Amortized cost		17.3		274.6		152.6		49.0		493.5
Estimated fair value		17.2		269.8		146.5		43.6		477.1
Total debt securities (excluding mortgage-backed securities)
Amortized cost	$	160.6	$	1,279.5	$	1,617.2	$	854.7	$	3,912.0
Estimated fair value	$	160.6	$	1,243.8	$	1,501.7	$	762.3	$	3,668.4
Total mortgage-backed securities
Amortized cost										6,623.2
Estimated fair value										6,094.2
Total debt securities
Amortized cost									$	10,535.2
Estimated fair value									$	9,762.6

Mortgage-backed securities, which include contractual terms to maturity, are not categorized by contractual maturity as borrowers may have the right to call or prepay obligations with, or without, call or prepayment penalties.

FIRST AMERICAN FINANCIAL CORPORATION
AND SUBSIDIARY COMPANIES
Notes to Condensed Consolidated Financial Statements – (Continued)
(unaudited)

The composition of the debt securities portfolio at September 30, 2026, by credit rating, is as follows:


	A- or higher					BBB+ to BBB-					Non-Investment Grade					Total
(dollars in millions)	Estimated fair value		Percentage			Estimated fair value		Percentage			Estimated fair value		Percentage			Estimated fair value
U.S. Treasury bonds	$	247.5		100.0	%	$	—		—	%	$	—		—	%	$	247.5
Municipal bonds		1,014.1		98.6			14.8		1.4			0.3		—			1,029.2
Foreign government bonds		228.1		96.5			7.5		3.2			0.7		0.3			236.3
Governmental agency bonds		444.0		100.0			—		—			—		—			444.0
Governmental agency mortgage- backed securities		6,094.2		100.0			—		—			—		—			6,094.2
U.S. corporate debt securities		786.8		63.7			302.4		24.5			145.1		11.8			1,234.3
Foreign corporate debt securities		264.7		55.5			185.5		38.9			26.9		5.6			477.1
	$	9,079.4		93.0	%	$	510.2		5.2	%	$	173.0		1.8	%	$	9,762.6

Included in debt securities at September 30, 2026 were bank loans totaling $102.7 million, of which $97.0 million were non-investment grade; high yield corporate debt securities totaling $71.1 million, all of which were non-investment grade; and emerging market debt securities totaling $30.1 million, of which $4.6 million were non-investment grade.

The composition of the debt securities portfolio in an unrealized loss position at September 30, 2026, by credit rating, is as follows:


	A- or higher					BBB+ to BBB-					Non-Investment Grade					Total
(dollars in millions)	Estimated fair value		Percentage			Estimated fair value		Percentage			Estimated fair value		Percentage			Estimated fair value
U.S. Treasury bonds	$	247.3		100.0	%	$	—		—	%	$	—		—	%	$	247.3
Municipal bonds		991.5		98.7			13.3		1.3			0.3		—			1,005.1
Foreign government bonds		174.9		95.5			7.5		4.1			0.7		0.4			183.1
Governmental agency bonds		444.0		100.0			—		—			—		—			444.0
Governmental agency mortgage- backed securities		6,047.5		100.0			—		—			—		—			6,047.5
U.S. corporate debt securities		720.3		65.8			273.0		25.0			100.6		9.2			1,093.9
Foreign corporate debt securities		227.3		56.7			155.6		38.9			17.8		4.4			400.7
	$	8,852.8		93.9	%	$	449.4		4.8	%	$	119.4		1.3	%	$	9,421.6

Debt securities in an unrealized loss position at September 30, 2026 included bank loans totaling $53.7 million, of which $51.9 million were non-investment grade; high yield corporate debt securities totaling $63.5 million, all of which were non-investment grade; and emerging market debt securities totaling $25.3 million, of which $3.7 million were non-investment grade.

The credit ratings in the above tables reflect published ratings obtained from globally recognized securities rating agencies. If a security was rated differently among the rating agencies the lowest rating was selected. Governmental agency mortgage-backed securities are not rated by any of the rating agencies; however, these securities have been included in the above table in the “A- or higher” rating category because the payments of principal and interest are guaranteed by the governmental agency that issued the security.

FIRST AMERICAN FINANCIAL CORPORATION
AND SUBSIDIARY COMPANIES
Notes to Condensed Consolidated Financial Statements – (Continued)
(unaudited)

Note 4 – Equity Securities

Investments in equity securities, by accounting classification, are summarized as follows:


(in millions)	September 30, 2026		December 31, 2025
Marketable equity securities	$	505.4	$	477.6
Non-marketable equity securities		216.6		253.1
Equity method investments		146.1		118.4
	$	868.1	$	849.1

Investments in marketable equity securities are summarized as follows:


(in millions)	Cost		Unrealized gains		Estimated fair value
September 30, 2026
Common stocks	$	457.5	$	38.1	$	495.6
Preferred stocks		8.6		1.2		9.8
	$	466.1	$	39.3	$	505.4
December 31, 2025
Common stocks	$	457.9	$	9.8	$	467.7
Preferred stocks		9.0		0.9		9.9
	$	466.9	$	10.7	$	477.6

Net gains of $1.2 million and $41.5 million resulting from changes in the fair values of marketable equity securities were recognized for the three and nine months ended September 30, 2026, respectively, which included net unrealized gains of $1.2 million and $38.8 million on securities still held at September 30, 2026, respectively. Net gains of $38.7 million and $57.8 million resulting from changes in the fair values of marketable equity securities were recognized for the three and nine months ended September 30, 2025, respectively, which included net unrealized gains of $35.7 million and $55.0 million on securities still held at September 30, 2025, respectively.

A summary of the changes in the carrying amounts of non-marketable equity securities, which primarily relate to the Company's venture investment portfolio, for the three and nine months ended September 30, 2026 and 2025, is as follows:


	Three Months Ended September 30,						Nine Months Ended September 30,
(in millions)	2026			2025			2026			2025
Carrying amount, beginning of period	$	214.4		$	218.3		$	253.1		$	202.4
Net additions		2.7			16.0			7.1			31.2
Gross unrealized gains		0.3			1.0			0.7			2.5
Gross unrealized losses and impairments		(0.8	)		(3.9	)		(44.3	)		(4.7	)
Carrying amount, end of period	$	216.6		$	231.4		$	216.6		$	231.4

During the nine months ended September 30, 2026, the Company recorded an impairment loss of $41.7 million on a non-marketable equity investment resulting from an internal valuation, which was driven by a change in the operations of the underlying business.

FIRST AMERICAN FINANCIAL CORPORATION
AND SUBSIDIARY COMPANIES
Notes to Condensed Consolidated Financial Statements – (Continued)
(unaudited)

Cumulative gross unrealized gains and cumulative gross unrealized losses and impairments related to non-marketable equity securities at September 30, 2026 and December 31, 2025, are summarized as follows:


(in millions)	September 30, 2026		December 31, 2025
Cumulative gross unrealized gains	$	280.8	$	280.1
Cumulative gross unrealized losses and impairments	$	405.1	$	360.8

Included in equity method investments are certain investments in nonconsolidated variable interest entities that are primarily limited partnerships. As of September 30, 2026 and December 31, 2025, the carrying values of these investments were $112.8 million and $86.8 million. At September 30, 2026, the Company’s maximum exposure to loss related to these investments, including any future commitments, was $125.4 million. In September 2026, the Company entered into a financing arrangement with an affiliated entity whereby it advanced $19.0 million, with optional advances up to a maximum of $25.0 million, in exchange for a secured promissory note with a term of 6 years and a stated interest rate of 11.0% per annum. The note is collateralized by first priority interests in multiple affiliated entities and is included in other assets on the condensed consolidated balance sheets.

Note 5 – Allowance for Credit Losses – Accounts Receivable

Activity in the allowance for credit losses on accounts receivable is summarized as follows:


	Three Months Ended September 30,						Nine Months Ended September 30,
(in millions)	2026			2025			2026			2025
Balance at beginning of period	$	25.5		$	23.5		$	23.9		$	21.5
Provision for expected credit losses		1.4			2.2			6.5			7.0
Write-offs/recoveries		(3.3	)		(2.0	)		(6.8	)		(4.8	)
Balance at end of period	$	23.6		$	23.7		$	23.6		$	23.7

Note 6 – Goodwill

A summary of the changes in the carrying amounts of goodwill, by reportable segment, for the nine months ended September 30, 2026, is as follows:


(in millions)	Title Insurance and Services			Home Warranty		Total
Balance at beginning of period	$	1,778.4		$	40.9	$	1,819.3
Acquisitions		0.9			—		0.9
Foreign currency translation		(1.9	)		—		(1.9	)
Balance at end of period	$	1,777.4		$	40.9	$	1,818.3

FIRST AMERICAN FINANCIAL CORPORATION
AND SUBSIDIARY COMPANIES
Notes to Condensed Consolidated Financial Statements – (Continued)
(unaudited)

Note 7 – Other Intangible Assets

Other intangible assets are summarized as follows:


(in millions)	September 30, 2026			December 31, 2025
Finite-lived intangible assets:
Customer relationships	$	144.5		$	148.8
Noncompete agreements		3.8			4.5
Trademarks		68.6			70.9
Internal-use software licenses		18.6			19.5
Patents		2.8			2.8
		238.3			246.5
Accumulated amortization		(177.9	)		(163.4	)
		60.4			83.1
Indefinite-lived intangible assets:
Licenses		16.9			16.9
	$	77.3		$	100.0

Amortization expense for finite-lived intangible assets was $8.5 million and $26.6 million for the three and nine months ended September 30, 2026, respectively, and $9.8 million and $28.4 million for the three and nine months ended September 30, 2025, respectively.

Estimated amortization expense for finite-lived intangible assets for the next five years is as follows:


Year	(in millions)
Remainder of 2026	$	7.7
2027	$	15.6
2028	$	9.2
2029	$	6.2
2030	$	5.2
2031	$	4.3

FIRST AMERICAN FINANCIAL CORPORATION
AND SUBSIDIARY COMPANIES
Notes to Condensed Consolidated Financial Statements – (Continued)
(unaudited)

Note 8 – Reserve for Known and Incurred But Not Reported Claims

Activity in the reserve for known and incurred but not reported claims is summarized as follows:


	Nine Months Ended September 30,
(in millions)	2026			2025
Balance at beginning of period	$	1,169.6		$	1,193.4
Provision related to:
Current year		291.7			274.2
Prior years		(31.5	)		(31.4	)
		260.2			242.8
Payments, net of recoveries, related to:
Current year		144.1			128.7
Prior years		143.0			132.7
		287.1			261.4
Other		(8.1	)		4.5
Balance at end of period	$	1,134.6		$	1,179.3

The provision for title insurance losses, expressed as a percentage of title insurance premiums and escrow fees, was 3.0% for the three and nine months ended September 30, 2026 and 2025.

The 3.0% loss provision rate for the three and nine months ended September 30, 2026 reflects an ultimate loss rate of 3.75% for the 2026 policy year and reserve releases of 0.75%, or $11.4 million and $32.5 million, respectively, for prior policy years, all based on title insurance premiums and escrow fees for the three and nine months ended September 30, 2026.

The 3.0% loss provision rate for the three and nine months ended September 30, 2025 reflected an ultimate loss rate of 3.75% for the 2025 policy year and reserve releases of 0.75%, or $10.5 million and $28.8 million, respectively, for prior policy years, all based on title insurance premiums and escrow fees for the three and nine months ended September 30, 2025.

A summary of the Company’s loss reserves is as follows:


(dollars in millions)	September 30, 2026				December 31, 2025
Known title claims	$	82.5	7.3	%	$	54.6	4.7	%
Incurred but not reported claims		1,031.2	90.9	%		1,095.9	93.7	%
Total title claims		1,113.7	98.2	%		1,150.5	98.4	%
Non-title claims		20.9	1.8	%		19.1	1.6	%
Total loss reserves	$	1,134.6	100.0	%	$	1,169.6	100.0	%

FIRST AMERICAN FINANCIAL CORPORATION
AND SUBSIDIARY COMPANIES
Notes to Condensed Consolidated Financial Statements – (Continued)
(unaudited)

Note 9 – Income Taxes

The Company’s effective income tax rates (income tax expense as a percentage of income before income taxes) were 22.4% and 22.7% for the three and nine months ended September 30, 2026, respectively, and 23.1% and 23.6% for the three and nine months ended September 30, 2025, respectively. The effective income tax rates differ from the federal statutory rate due to (1) state and foreign income taxes for which the Company is liable, (2) permanent differences between amounts reported for financial statement purposes and amounts reported for income tax purposes, (3) the recognition of excess tax benefits or tax deficiencies associated with share-based payment transactions through income tax expense and (4) tax credits claimed.

The Company evaluates the realizability of its deferred tax assets by assessing the valuation allowance and making adjustments to the allowance as necessary. The factors used in assessing the likelihood of realization include forecasts of future taxable income and available tax planning strategies that could be implemented. The Company’s ability to achieve forecasted taxable income in the applicable taxing jurisdictions could affect the ultimate realization of its deferred tax assets. As of September 30, 2026 and December 31, 2025, the Company carried a valuation allowance of $29.4 million. Based on future operating results in certain jurisdictions, it is possible that the current valuation allowance positions of those jurisdictions could be adjusted during the next 12 months.

As of September 30, 2026 and December 31, 2025, the liabilities for income taxes associated with uncertain tax positions were $35.0 million and $34.4 million, respectively. The liabilities as of September 30, 2026 and December 31, 2025 could be reduced by $3.4 million and $3.7 million, respectively, due to offsetting tax benefits associated with the correlative effects of potential adjustments, including timing adjustments and state income taxes. The net liability, if recognized, would favorably affect the Company’s effective income tax rate.

The Company’s continuing practice is to recognize interest and penalties related to uncertain tax positions in income tax expense. Accrued interest and penalties, net of tax benefits, related to uncertain tax positions as of September 30, 2026 and December 31, 2025, were not material.

The Company, or one of its subsidiaries, files income tax returns in the U.S. federal jurisdiction, various state jurisdictions and in various non-U.S. jurisdictions. The primary non-federal jurisdictions are California, Canada, India and the United Kingdom. As of September 30, 2026, the Company is generally no longer subject to income tax examinations by U.S. federal, state and non-U.S. taxing authorities for years prior to 2022, 2019 and 2014, respectively.

The Company is subject to international anti-base erosion rules that assess a minimum tax rate of 15% in the jurisdictions in which it operates. Commonly known as “Pillar II,” these rules apply to large multinational enterprises and are designed to address the tax challenges arising from the globalization and digitalization of the economy. The Company has calculated the minimum tax on a jurisdiction-by-jurisdiction basis and has determined that the resulting tax is not material to its financial results.

Public Law 119-21, popularly known as the “One Big Beautiful Bill Act” (“OBBBA”), was signed into law on July 4, 2025. This legislation includes a broad range of tax reform provisions affecting businesses, with certain tax provisions effective January 1, 2026. The Company does not expect those provisions to have a material effect on its ongoing effective tax rate.

FIRST AMERICAN FINANCIAL CORPORATION
AND SUBSIDIARY COMPANIES
Notes to Condensed Consolidated Financial Statements – (Continued)
(unaudited)

Note 10 – Earnings Per Share

The computation of basic and diluted earnings per share is as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(in millions, except per share data)	2026		2025		2026		2025
Numerator
Net income attributable to the Company	$	177.0	$	189.6	$	520.6	$	409.9
Denominator
Basic weighted-average shares		102.7		102.8		102.8		103.5
Effect of dilutive restricted stock units (“RSUs”) and performance restricted stock units (“PRSUs”)		0.5		0.3		0.4		0.3
Diluted weighted-average shares		103.2		103.1		103.2		103.8
Net income per share attributable to the Company’s stockholders
Basic	$	1.72	$	1.84	$	5.06	$	3.96
Diluted	$	1.72	$	1.84	$	5.04	$	3.95

For the three and nine months ended September 30, 2026 no RSUs and an immaterial amount of RSUs, respectively, were excluded from diluted weighted-average common shares outstanding due to their antidilutive effect. For the three and nine months ended September 30, 2026 no PRSUs were excluded from diluted weighted-average common shares outstanding due to their antidilutive effect. For the three and nine months ended September 30, 2025, 59 thousand RSUs and 49 thousand and 31 thousand PRSUs, respectively, were excluded from diluted weighted-average common shares outstanding due to their antidilutive effect.

Note 11 – Employee Benefit Plans

Net periodic benefit costs related to the Company’s unfunded supplemental benefit pension plans are summarized as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(in millions)	2026		2025		2026		2025
Expense:
Service costs	$	—	$	—	$	—	$	0.1
Interest costs		2.1		2.4		6.2		7.1
Amortization of net actuarial loss		0.5		0.5		1.5		1.4
	$	2.6	$	2.9	$	7.7	$	8.6

The Company contributed $11.3 million to its unfunded supplemental benefit pension plans during the nine months ended September 30, 2026 and expects to contribute an additional $4.6 million during the remainder of 2026.

FIRST AMERICAN FINANCIAL CORPORATION
AND SUBSIDIARY COMPANIES
Notes to Condensed Consolidated Financial Statements – (Continued)
(unaudited)

Note 12 – Fair Value Measurements

Certain of the Company’s assets are carried at fair value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

The Company categorizes its assets and liabilities carried at fair value using a three-level hierarchy for fair value measurements that distinguishes between market participant assumptions developed based on market data obtained from sources independent of the Company (observable inputs) and the Company’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). The hierarchy for inputs used in determining fair value maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that observable inputs be used when available. The hierarchy level assigned to the assets and liabilities is based on management’s assessment of the transparency and reliability of the inputs used to estimate the fair values at the measurement date. The three hierarchy levels are defined as follows:

Level 1—Valuations based on unadjusted quoted market prices in active markets for identical assets or liabilities.

Level 2—Valuations based on observable inputs (other than Level 1 prices), such as quoted prices for similar assets or liabilities at the measurement date; quoted prices in markets that are not active; or other inputs that are observable, either directly or indirectly.

Level 3—Valuations based on inputs that are unobservable and significant to the overall fair value measurement and involve management judgment.

If the inputs used to measure fair value fall into different levels of the fair value hierarchy, the hierarchy level assigned is based upon the lowest level of input that is significant to the fair value measurement.

The following tables present the fair values of the Company’s assets, measured on a recurring basis, as of September 30, 2026 and December 31, 2025:


(in millions)	Total		Level 1		Level 2		Level 3
September 30, 2026
Debt securities:
U.S. Treasury bonds	$	247.5	$	—	$	247.5	$	—
Municipal bonds		1,029.2		—		1,029.2		—
Foreign government bonds		236.3		—		236.3		—
Governmental agency bonds		444.0		—		444.0		—
Governmental agency mortgage-backed securities		6,094.2		—		6,094.2		—
U.S. corporate debt securities		1,234.3		—		1,234.3		—
Foreign corporate debt securities		477.1		—		477.1		—
		9,762.6		—		9,762.6		—
Equity securities:
Common stocks		495.6		495.6		—		—
Preferred stocks		9.8		9.8		—		—
		505.4		505.4		—		—
Total	$	10,268.0	$	505.4	$	9,762.6	$	—

FIRST AMERICAN FINANCIAL CORPORATION
AND SUBSIDIARY COMPANIES
Notes to Condensed Consolidated Financial Statements – (Continued)
(unaudited)


(in millions)	Total		Level 1		Level 2		Level 3
December 31, 2025
Debt securities:
U.S. Treasury bonds	$	243.6	$	—	$	243.6	$	—
Municipal bonds		960.1		—		960.1		—
Foreign government bonds		235.2		—		235.2		—
Governmental agency bonds		261.0		—		261.0		—
Governmental agency mortgage-backed securities		5,260.8		—		5,260.8		—
U.S. corporate debt securities		1,034.8		—		1,034.8		—
Foreign corporate debt securities		471.2		—		471.2		—
		8,466.7		—		8,466.7		—
Equity securities:
Common stocks		467.7		467.7		—		—
Preferred stocks		9.9		9.9		—		—
		477.6		477.6		—		—
Total	$	8,944.3	$	477.6	$	8,466.7	$	—

The following table presents the carrying amounts and estimated fair values of the Company’s financial instruments not measured at fair value as of September 30, 2026 and December 31, 2025:


	Carrying		Estimated fair value
(in millions)	Amount		Total		Level 1		Level 2		Level 3
September 30, 2026
Assets:
Cash and cash equivalents	$	1,731.1	$	1,731.1	$	1,731.1	$	—	$	—
Deposits with banks	$	106.8	$	106.5	$	26.0	$	80.5	$	—
Notes receivable, net	$	66.7	$	68.1	$	—	$	—	$	68.1
Secured financings receivable	$	930.3	$	930.3	$	—	$	930.3	$	—
Liabilities:
Secured financings payable	$	807.5	$	807.5	$	—	$	807.5	$	—
Notes and contracts payable	$	1,546.8	$	1,392.4	$	—	$	1,384.7	$	7.7


	Carrying		Estimated fair value
(in millions)	Amount		Total		Level 1		Level 2		Level 3
December 31, 2025
Assets:
Cash and cash equivalents	$	1,387.3	$	1,387.3	$	1,387.3	$	—	$	—
Deposits with banks	$	78.5	$	78.2	$	9.9	$	68.3	$	—
Notes receivable, net	$	35.7	$	36.1	$	—	$	—	$	36.1
Secured financings receivable	$	986.1	$	986.1	$	—	$	986.1	$	—
Liabilities:
Secured financings payable	$	906.5	$	906.5	$	—	$	906.5	$	—
Notes and contracts payable	$	1,545.4	$	1,459.9	$	—	$	1,452.1	$	7.8

FIRST AMERICAN FINANCIAL CORPORATION
AND SUBSIDIARY COMPANIES
Notes to Condensed Consolidated Financial Statements – (Continued)
(unaudited)

Assets measured at fair value on a non-recurring basis


	Estimated fair value (2)
(in millions)	Total		Level 1		Level 2		Level 3
September 30, 2026
Non-marketable equity securities (1)	$	104.8	$	—	$	96.0	$	8.8

(1)

Excludes $111.8 million of non-marketable equity securities for which no observable price changes or impairment charges occurred during the nine months ended September 30, 2026.

(2)

Estimated fair values were determined during the year as of the dates that either an observable transaction occurred or an impairment assessment was made.

Non-marketable equity securities that have been remeasured during the year based on observable price changes are classified within Level 2 in the fair value hierarchy because the fair value is determined based only on significant inputs that are observable, such as observable transactions at the transaction date.

The following table presents the valuation techniques and significant unobservable inputs used in measuring the fair value of non-marketable equity securities classified within Level 3 of the fair value hierarchy as of September 30, 2026:

          (in millions)

          Fair Value

          Approach

          Input

          Range

          Weighted Average (1)

Non-marketable equity securities

8.8

Market

Gross Profit Multiple

7.2-14.8

10.3

(1)

Weighted average is calculated based on the fair values of the non-marketable equity securities.

Note 13 – Share-Based Compensation

The following table summarizes the costs associated with the Company’s share-based compensation plans:


	Three Months Ended September 30,				Nine Months Ended September 30,
(in millions)	2026		2025		2026		2025
Expense:
RSUs	$	8.7	$	8.6	$	42.0	$	47.8
PRSUs		0.9		1.5		4.1		6.5
Employee stock purchase plan		1.7		1.7		5.6		5.3
	$	11.3	$	11.8	$	51.7	$	59.6

The following table summarizes RSU and PRSU activity for the nine months ended September 30, 2026:


(in millions, except weighted-average grant-date fair value)	Shares			Weighted-average grant-date fair value
Unvested at December 31, 2025		1.2		$	63.46
Granted during 2026		1.1		$	68.50
Vested during 2026		(0.8	)	$	65.43
Forfeited during 2026		(0.1	)	$	65.57
Unvested at September 30, 2026		1.4		$	66.07

FIRST AMERICAN FINANCIAL CORPORATION
AND SUBSIDIARY COMPANIES
Notes to Condensed Consolidated Financial Statements – (Continued)
(unaudited)

Note 14 – Stockholders’ Equity

The Company maintains a stock repurchase plan with authorization up to $300 million of the Company’s common stock, of which $244.5 million remained as of September 30, 2026. Purchases may be made from time to time by the Company in the open market at prevailing market prices or in privately negotiated transactions. During the nine months ended September 30, 2026, the Company repurchased and retired 0.9 million shares of its common stock for a total purchase price of $55.5 million.

Note 15 – Accumulated Other Comprehensive Income (Loss) (“AOCI”)

The following table presents a summary of the changes in each component of AOCI for the nine months ended September 30, 2026:


(in millions)	Unrealized gains (losses) on debt securities			Foreign currency translation adjustment			Pension benefit adjustment			Accumulated other comprehensive income (loss)
Balance at December 31, 2025	$	(147.6	)	$	(76.3	)	$	(32.8	)	$	(256.7	)
Change in unrealized losses on debt securities		(582.6	)		—			—			(582.6	)
Change in foreign currency translation adjustment		—			(17.3	)		—			(17.3	)
Amortization of net actuarial loss		—			—			1.5			1.5
Tax effect		146.0			0.3			(0.4	)		145.9
Balance at September 30, 2026	$	(584.2	)	$	(93.3	)	$	(31.7	)	$	(709.2	)

The following table presents the other comprehensive income (loss) reclassification adjustments for the three months ended September 30, 2026 and 2025:


(in millions)	Unrealized gains (losses) on debt securities			Foreign currency translation adjustment			Pension benefit adjustment			Total other comprehensive income (loss)
Three Months Ended September 30, 2026
Pretax change before reclassifications	$	(486.7	)	$	2.4		$	—		$	(484.3	)
Reclassifications out of AOCI		1.4			—			0.5			1.9
Tax effect		121.3			—			(0.1	)		121.2
Total other comprehensive income (loss), net of tax	$	(364.0	)	$	2.4		$	0.4		$	(361.2	)
Three Months Ended September 30, 2025
Pretax change before reclassifications	$	91.7		$	(11.9	)	$	—		$	79.8
Reclassifications out of AOCI		2.0			—			0.5			2.5
Tax effect		(22.9	)		0.2			(0.2	)		(22.9	)
Total other comprehensive income (loss), net of tax	$	70.8		$	(11.7	)	$	0.3		$	59.4

FIRST AMERICAN FINANCIAL CORPORATION
AND SUBSIDIARY COMPANIES
Notes to Condensed Consolidated Financial Statements – (Continued)
(unaudited)

The following table presents the other comprehensive income (loss) reclassification adjustments for the nine months ended September 30, 2026 and 2025:


(in millions)	Unrealized gains (losses) on debt securities			Foreign currency translation adjustment			Pension benefit adjustment			Total other comprehensive income (loss)
Nine Months Ended September 30, 2026
Pretax change before reclassifications	$	(586.8	)	$	(17.3	)	$	—		$	(604.1	)
Reclassifications out of AOCI		4.2			—			1.5			5.7
Tax effect		146.0			0.3			(0.4	)		145.9
Total other comprehensive income (loss), net of tax	$	(436.6	)	$	(17.0	)	$	1.1		$	(452.5	)
Nine Months Ended September 30, 2025
Pretax change before reclassifications	$	234.5		$	27.7		$	—		$	262.2
Reclassifications out of AOCI		8.9			—			1.4			10.3
Tax effect		(61.3	)		(0.6	)		(0.4	)		(62.3	)
Total other comprehensive income (loss), net of tax	$	182.1		$	27.1		$	1.0		$	210.2

The following table presents the effects of the reclassifications out of AOCI on the respective line items in the condensed consolidated statements of income:


	Three Months Ended September 30,						Nine Months Ended September 30,
(in millions)	2026			2025			2026			2025			Affected line items
Unrealized gains (losses) on debt securities:
Net realized losses on sales of debt securities	$	(1.4	)	$	(2.0	)	$	(4.2	)	$	(8.9	)	Net investment gains (losses)
Tax effect	$	0.4		$	0.4		$	1.1		$	2.2
Pension benefit adjustment (1):
Amortization of net actuarial loss	$	(0.5	)	$	(0.5	)	$	(1.5	)	$	(1.4	)	Other operating expenses
Tax effect	$	0.1		$	0.2		$	0.4		$	0.4

(1)

Amounts are components of net periodic cost. See Note 11 Employee Benefit Plans for additional details.

FIRST AMERICAN FINANCIAL CORPORATION
AND SUBSIDIARY COMPANIES
Notes to Condensed Consolidated Financial Statements – (Continued)
(unaudited)

Note 16 – Litigation and Regulatory Contingencies

The Company and its subsidiaries are parties to lawsuits and are also involved in ongoing routine legal and regulatory proceedings related to their operations. These lawsuits and proceedings frequently are similar in nature to other lawsuits and proceedings pending against the Company’s competitors. When the Company has determined that a loss is both probable and reasonably estimable, a liability representing the best estimate of the Company’s financial exposure based on known facts has been recorded. Actual losses may materially differ from the amounts recorded.

With respect to the Company’s outstanding ordinary course lawsuits and proceedings, the Company has determined either that a loss is not reasonably possible or that the estimated loss or range of loss, if any, is not expected to have a material adverse effect on the Company’s financial condition, results of operations or cash flows. The Company’s ordinary course lawsuits include class actions or purported class action lawsuits.

Most of the Company’s businesses are regulated by various federal, state and local governmental agencies. Many of the Company’s other businesses operate within statutory guidelines. Consequently, the Company may from time to time be subject to examination or investigation by such governmental agencies. Currently, governmental agencies are examining or investigating certain of the Company’s operations.

The Company does not believe that any pending examinations or investigations will have a material adverse effect on the Company’s financial condition, results of operations or cash flows. Some of these exams or investigations could, however, result in changes to the Company’s business practices which could ultimately have a material adverse impact on the Company’s financial condition, results of operations or cash flows.

Note 17 – Segment Information

The Company consists of the following reportable segments:

•

The title insurance and services segment issues title insurance policies on residential and commercial property in the United States and offers similar or related products and services internationally. This segment also provides closing and/or escrow services; accommodates tax-deferred exchanges of real estate; provides products, services and solutions designed to mitigate risk or otherwise facilitate real estate transactions; maintains, manages and provides access to title plant data and records; provides appraisals and other valuation-related products and services; provides lien release, document custodial and default-related products and services; provides document generation services; provides warehouse lending services; subservices mortgage loans; and provides banking, trust and wealth management services. The Company, through its principal title insurance subsidiary and such subsidiary’s affiliates, transacts its title insurance business through a network of direct operations and agents. Through this network, the Company issues policies in the 49 states that permit the issuance of title insurance policies, the District of Columbia and certain United States territories. The Company also offers title insurance, closing services and similar or related products and services, either directly or through third parties in other countries, including Canada, the United Kingdom, various countries in Europe, South Korea, Australia and New Zealand.

•

The home warranty segment sells products including residential service contracts that cover residential systems, such as heating and air conditioning systems, and certain appliances against failures that occur as the result of normal usage during the coverage period. This business currently operates in 36 states and the District of Columbia.

•

The corporate segment includes investments in venture-stage companies, certain financing facilities and corporate services that support the Company’s business operations.

FIRST AMERICAN FINANCIAL CORPORATION
AND SUBSIDIARY COMPANIES
Notes to Condensed Consolidated Financial Statements – (Continued)
(unaudited)

Information about reportable segment performance, significant expenses and assets are as follows:

For the three months ended September 30, 2026:


(dollars in millions)	Title Insurance and Services			Home Warranty			Corporate			Eliminations				Consolidated
Total segment revenue	$	1,972.9		$	114.7		$	(2.9	)	$	(0.1	)		$	2,084.6

Less: (1)
Personnel costs		574.1			22.4			0.8			0.1				597.4
Premiums retained by agents		695.6			—			—			—				695.6
Other operating expenses (2)		306.4			28.2			9.6			(0.6	)			343.6
Provision for policy losses		45.3			50.2			(0.6	)		0.2				95.1
Depreciation and amortization		53.3			1.3			—			0.1				54.7
Premium taxes		22.8			1.3			—			0.1				24.2
Interest		31.3			—			15.2			(0.1	)			46.4
Segment income (loss) before income taxes	$	244.1		$	11.3		$	(27.9	)	$	0.1			$	227.6

Pretax margin (3)		12.4	%		9.9	%

Segment assets	$	16,836.6		$	452.2		$	1,074.2		$	(380.2	)	(4)	$	17,982.8

Segment capital expenditures	$	41.5		$	1.4									$	42.9

(1)

The significant expense categories and amounts align with segment level information that is regularly provided to the chief operating decision maker.

(2)

Other operating expenses for each segment primarily include the following:

Title insurance and services - title and data search expenses, office and occupancy expenses and software expense.

Home warranty - advertising expense, office and occupancy expenses, software expense, delivery and storage expenses.

Corporate - employee benefit expense and certain overhead expenses.

(3)

Pretax margin for the corporate segment is not regularly provided to the chief operating decision maker to assess performance.

(4)

Elimination of intercompany asset balances:


Holding company cash balances also included in the title insurance and services segment	$	(375.4	)
Home warranty segment cash balances also included in the title insurance and services segment		(4.8	)
	$	(380.2	)

FIRST AMERICAN FINANCIAL CORPORATION
AND SUBSIDIARY COMPANIES
Notes to Condensed Consolidated Financial Statements – (Continued)
(unaudited)

For the three months ended September 30, 2025:


(dollars in millions)	Title Insurance and Services			Home Warranty			Corporate			Eliminations				Consolidated
Total segment revenue	$	1,835.9		$	114.6		$	28.4		$	—			$	1,978.9

Less: (1)
Personnel costs		542.9			21.4			10.6			—				574.9
Premiums retained by agents		640.1			—			—			—				640.1
Other operating expenses (2)		275.6			24.4			9.3			(0.1	)			309.2
Provision for policy losses		42.0			50.0			(1.3	)		0.1				90.8
Depreciation and amortization		53.5			1.3			—			—				54.8
Premium taxes		20.9			1.3			—			—				22.2
Interest		24.7			—			15.2			—				39.9
Segment income (loss) before income taxes	$	236.2		$	16.2		$	(5.4	)	$	—			$	247.0

Pretax margin (3)		12.9	%		14.1	%

Segment assets	$	16,625.6		$	437.0		$	694.5		$	(147.1	)	(4)	$	17,610.0

Segment capital expenditures	$	47.4		$	1.6									$	49.0

(1)

The significant expense categories and amounts align with segment level information that is regularly provided to the chief operating decision maker.

(2)

Other operating expenses for each segment primarily include the following:

Title insurance and services - title and data search expenses, office and occupancy expenses and software expense.

Home warranty - advertising expense, office and occupancy expenses, software expense, delivery and storage expenses.

Corporate - employee benefit expense and certain overhead expenses.

(3)

Pretax margin for the corporate segment is not regularly provided to the chief operating decision maker to assess performance.

(4)

Elimination of intercompany asset balances:


Holding company cash balances also included in the title insurance and services segment	$	(143.3	)
Home warranty segment cash balances also included in the title insurance and services segment		(3.8	)
	$	(147.1	)

FIRST AMERICAN FINANCIAL CORPORATION
AND SUBSIDIARY COMPANIES
Notes to Condensed Consolidated Financial Statements – (Continued)
(unaudited)

For the nine months ended September 30, 2026:


(dollars in millions)	Title Insurance and Services			Home Warranty			Corporate			Eliminations			Consolidated
Total segment revenue	$	5,719.8		$	338.3		$	(18.0	)	$	(0.2	)	$	6,039.9

Less: (1)
Personnel costs		1,693.0			65.4			21.4			0.1			1,779.9
Premiums retained by agents		1,956.4			—			—			—			1,956.4
Other operating expenses (2)		902.8			74.8			29.1			(0.6	)		1,006.1
Provision for policy losses		130.1			129.1			0.9			0.1			260.2
Depreciation and amortization		158.7			4.1			0.1			—			162.9
Premium taxes		63.4			3.6			—			0.1			67.1
Interest		88.4			—			45.6			—			134.0
Segment income (loss) before income taxes	$	727.0		$	61.3		$	(115.1	)	$	0.1		$	673.3

Pretax margin (3)		12.7	%		18.1	%

Segment capital expenditures	$	120.0		$	4.3								$	124.3

(1)

The significant expense categories and amounts align with segment level information that is regularly provided to the chief operating decision maker.

(2)

Other operating expenses for each segment primarily include the following:

Title insurance and services - title and data search expenses, office and occupancy expenses and software expense.

Home warranty - advertising expense, office and occupancy expenses, software expense, delivery and storage expenses.

Corporate - employee benefit expense and certain overhead expenses.

(3)

Pretax margin for the corporate segment is not regularly provided to the chief operating decision maker to assess performance.

FIRST AMERICAN FINANCIAL CORPORATION
AND SUBSIDIARY COMPANIES
Notes to Condensed Consolidated Financial Statements – (Continued)
(unaudited)

For the nine months ended September 30, 2025:


(dollars in millions)	Title Insurance and Services			Home Warranty			Corporate			Eliminations			Consolidated
Total segment revenue	$	5,043.2		$	332.6		$	26.8		$	(0.1	)	$	5,402.5

Less: (1)
Personnel costs		1,550.7			62.6			39.4			—			1,652.7
Premiums retained by agents		1,739.1			—			—			—			1,739.1
Other operating expenses (2)		799.8			68.8			28.4			(0.1	)		896.9
Provision for policy losses		114.9			130.5			(2.6	)		—			242.8
Depreciation and amortization		156.3			3.9			0.1			—			160.3
Premium taxes		55.2			3.6			—			—			58.8
Interest		67.5			—			45.6			—			113.1
Segment income (loss) before income taxes	$	559.7		$	63.2		$	(84.1	)	$	—		$	538.8

Pretax margin (3)		11.1	%		19.0	%

Segment capital expenditures	$	143.4		$	4.7								$	148.1

(1)

The significant expense categories and amounts align with segment level information that is regularly provided to the chief operating decision maker.

(2)

Other operating expenses for each segment primarily include the following:

Title insurance and services - title and data search expenses, office and occupancy expenses and software expense.

Home warranty - advertising expense, office and occupancy expenses, software expense, delivery and storage expenses.

Corporate - employee benefit expense and certain overhead expenses.

(3)

Pretax margin for the corporate segment is not regularly provided to the chief operating decision maker to assess performance.

Revenues by segment are as follows:

For the three months ended September 30, 2026:


(in millions)	Direct premiums and escrow fees			Agent premiums		Information and other			Net investment income			Net investment gains (losses)			Total Revenues
Title Insurance and Services	$	642.8		$	868.4	$	292.2		$	169.3		$	0.2		$	1,972.9
Home Warranty		107.1			—		5.8			1.6			0.2			114.7
Corporate and Eliminations		(0.1	)		—		(0.1	)		(0.8	)		(2.0	)		(3.0	)
	$	749.8		$	868.4	$	297.9		$	170.1		$	(1.6	)	$	2,084.6

For the three months ended September 30, 2025:


(in millions)	Direct premiums and escrow fees			Agent premiums		Information and other		Net investment income		Net investment gains (losses)		Total Revenues
Title Insurance and Services	$	601.5		$	798.8	$	276.1	$	153.1	$	6.4	$	1,835.9
Home Warranty		106.6			—		5.7		1.4		0.9		114.6
Corporate and Eliminations		(0.1	)		—		0.2		9.3		19.0		28.4
	$	708.0		$	798.8	$	282.0	$	163.8	$	26.3	$	1,978.9

FIRST AMERICAN FINANCIAL CORPORATION
AND SUBSIDIARY COMPANIES
Notes to Condensed Consolidated Financial Statements – (Continued)
(unaudited)

For the nine months ended September 30, 2026:


(in millions)	Direct premiums and escrow fees		Agent premiums		Information and other		Net investment income		Net investment gains (losses)			Total Revenues
Title Insurance and Services	$	1,889.1	$	2,447.5	$	856.4	$	487.5	$	39.3		$	5,719.8
Home Warranty		315.0		—		17.9		4.2		1.2			338.3
Corporate and Eliminations		—		—		6.5		14.5		(39.2	)		(18.2	)
	$	2,204.1	$	2,447.5	$	880.8	$	506.2	$	1.3		$	6,039.9

For the nine months ended September 30, 2025:


(in millions)	Direct premiums and escrow fees			Agent premiums		Information and other		Net investment income		Net investment gains (losses)			Total Revenues
Title Insurance and Services	$	1,661.5		$	2,169.9	$	776.4	$	437.9	$	(2.5	)	$	5,043.2
Home Warranty		311.9			—		17.8		3.4		(0.5	)		332.6
Corporate and Eliminations		(0.1	)		—		0.1		17.9		8.8			26.7
	$	1,973.3		$	2,169.9	$	794.3	$	459.2	$	5.8		$	5,402.5

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

CERTAIN STATEMENTS IN THIS QUARTERLY REPORT ON FORM 10-Q ARE FORWARD-LOOKING STATEMENTS WITHIN THE MEANING OF SECTION 27A OF THE SECURITIES ACT OF 1933, AS AMENDED, AND SECTION 21E OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. THESE FORWARD-LOOKING STATEMENTS MAY CONTAIN THE WORDS “BELIEVE,” “ANTICIPATE,” “EXPECT,” “PLAN,” “PREDICT,” “ESTIMATE,” “PROJECT,” “WILL BE,” “WILL CONTINUE,” “WILL LIKELY RESULT,” OR OTHER SIMILAR WORDS AND PHRASES.

RISKS AND UNCERTAINTIES EXIST THAT MAY CAUSE RESULTS TO DIFFER MATERIALLY FROM THOSE SET FORTH IN THESE FORWARD-LOOKING STATEMENTS. FACTORS THAT COULD CAUSE THE ANTICIPATED RESULTS TO DIFFER FROM THOSE DESCRIBED IN THE FORWARD-LOOKING STATEMENTS INCLUDE THE FACTORS SET FORTH ON PAGES 3-4 OF THIS QUARTERLY REPORT. THE FORWARD-LOOKING STATEMENTS SPEAK ONLY AS OF THE DATE THEY ARE MADE. THE COMPANY DOES NOT UNDERTAKE TO UPDATE FORWARD-LOOKING STATEMENTS TO REFLECT CIRCUMSTANCES OR EVENTS THAT OCCUR AFTER THE DATE THE FORWARD-LOOKING STATEMENTS ARE MADE.

This Management’s Discussion and Analysis contains the financial measure adjusted debt to capitalization ratio that is not presented in accordance with generally accepted accounting principles (“GAAP”), as it excludes the effects of secured financings payable. The Company is presenting this non-GAAP financial measure because it provides the Company’s management and readers of this Quarterly Report on Form 10-Q with additional insight into the financial leverage of the Company. The Company does not intend for this non-GAAP financial measure to be a substitute for any GAAP financial information. In this Quarterly Report on Form 10-Q, this non-GAAP financial measure has been presented with, and reconciled to, the most directly comparable GAAP financial measure. Readers of this Quarterly Report on Form 10-Q should use this non-GAAP financial measure only in conjunction with the comparable GAAP financial measure. Because not all companies use identical calculations, the presentation of adjusted debt to capitalization ratio may not be comparable to other similarly titled measures of other companies.

CRITICAL ACCOUNTING ESTIMATES

A summary of the Company’s significant accounting policies that it considers to be the most dependent on the application of estimates and assumptions can be found in the Management’s Discussion and Analysis section of the Company’s Annual Report on Form 10-K for the year ended December 31, 2025.

Pending Accounting Pronouncements

See Note 1 Basis of Condensed Consolidated Financial Statements to the condensed consolidated financial statements.

Results of Operations

Summary


	Three Months Ended September 30,											Nine Months Ended September 30,
(dollars in millions)	2026			2025		$ Change			% Change			2026			2025		$ Change			% Change
Total Revenues by Segment
Title Insurance and Services	$	1,972.9		$	1,835.9	$	137.0			7.5	%	$	5,719.8		$	5,043.2	$	676.6			13.4	%
Home Warranty		114.7			114.6		0.1			0.1			338.3			332.6		5.7			1.7
Corporate and Eliminations		(3.0	)		28.4		(31.4	)		(110.6	)		(18.2	)		26.7		(44.9	)		(168.2	)
	$	2,084.6		$	1,978.9	$	105.7			5.3	%	$	6,039.9		$	5,402.5	$	637.4			11.8	%

A substantial portion of the revenues for the Company’s title insurance and services segment result from sales of, and refinancings of loans on, residential and commercial real estate. In the home warranty segment, revenues associated with the initial year of coverage are impacted by volatility in residential purchase transactions. Traditionally, the greatest volume of real estate activity, particularly residential purchase activity, occurs in the spring and summer months. However, changes in interest rates, as well as other changes in general economic conditions in the United States and abroad, can cause fluctuations in the traditional pattern of real estate activity.

The Company’s total revenues for the third quarter of 2026 were $2.1 billion, which reflected an increase of $105.7 million, or 5.3%, when compared with $2.0 billion for the third quarter of 2025. This increase was primarily attributable to increases in agent premiums of $69.6 million, or 8.7%, and direct premiums and escrow fees in the title insurance business of $41.3 million, or 6.9%. In the title insurance and services segment, direct premiums and escrow fees from domestic commercial transactions increased $51.5 million, or 20.9%, and residential refinance and purchase transactions decreased $0.4 million, or 1.2%, and $6.4 million, or 2.6%, respectively, in the third quarter of 2026 when compared to the third quarter of 2025.

According to the Mortgage Bankers Association’s October 11, 2026 Mortgage Finance Forecast (the “MBA Forecast”), residential mortgage originations in the United States (based on the total dollar value of the transactions) are forecasted to decrease 3.7% in the third quarter of 2026 when compared to the third quarter of 2025. According to the MBA Forecast, the dollar amount of purchase originations is forecasted to decrease 2.8% and refinance originations are forecasted to decrease 6.1%. This volume of domestic residential mortgage origination activity contributed to decreases of 2.6% in direct premiums and escrow fees for the Company’s direct title operations from domestic residential purchase transactions and 1.2% from domestic refinance transactions in the third quarter of 2026 when compared to the third quarter of 2025.

During the third quarter of 2026, the level of domestic title orders opened per day by the Company’s direct title operations decreased 8.2% when compared with the third quarter of 2025. Commercial opened orders per day increased 2.4%, while residential purchase and refinance opened orders per day decreased 5.1% and 16.4%, respectively, in the third quarter of 2026 when compared with the third quarter of 2025.

Title Insurance and Services


	Three Months Ended September 30,												Nine Months Ended September 30,
(dollars in millions)	2026			2025			$ Change			% Change			2026			2025			$ Change			% Change
Revenues
Direct premiums and escrow fees	$	642.8		$	601.5		$	41.3			6.9	%	$	1,889.1		$	1,661.5		$	227.6			13.7	%
Agent premiums		868.4			798.8			69.6			8.7			2,447.5			2,169.9			277.6			12.8
Information and other		292.2			276.1			16.1			5.8			856.4			776.4			80.0			10.3
Net investment income		169.3			153.1			16.2			10.6			487.5			437.9			49.6			11.3
Net investment gains (losses)		0.2			6.4			(6.2	)		(96.9	)		39.3			(2.5	)		41.8		NM1
		1,972.9			1,835.9			137.0			7.5			5,719.8			5,043.2			676.6			13.4
Expenses
Personnel costs		574.1			542.9			31.2			5.7			1,693.0			1,550.7			142.3			9.2
Premiums retained by agents		695.6			640.1			55.5			8.7			1,956.4			1,739.1			217.3			12.5
Other operating expenses		306.4			275.6			30.8			11.2			902.8			799.8			103.0			12.9
Provision for policy losses and other claims		45.3			42.0			3.3			7.9			130.1			114.9			15.2			13.2
Depreciation and amortization		53.3			53.5			(0.2	)		(0.4	)		158.7			156.3			2.4			1.5
Premium taxes		22.8			20.9			1.9			9.1			63.4			55.2			8.2			14.9
Interest		31.3			24.7			6.6			26.7			88.4			67.5			20.9			31.0
		1,728.8			1,599.7			129.1			8.1			4,992.8			4,483.5			509.3			11.4
Income before income taxes	$	244.1		$	236.2		$	7.9			3.3	%	$	727.0		$	559.7		$	167.3			29.9	%
Pretax margins		12.4	%		12.9	%		(0.5	)%		(3.9	)%		12.7	%		11.1	%		1.6	%		14.4	%

(1)

Not meaningful

Direct premiums and escrow fees were $642.8 million and $1.9 billion for the three and nine months ended September 30, 2026, respectively, increases of $41.3 million, or 6.9%, and $227.6 million, or 13.7%, when compared with the respective periods of the prior year. The increases were due to increases in domestic average revenues per order. Domestic average revenues per order closed were $4,304 and $4,375 for the three and nine months ended September 30, 2026, increases of 13.2% and 14.5% when compared with $3,801 and $3,820 for the respective periods of the prior year. The increase in the average revenue per order closed for the three months ended September 30, 2026 was primarily due to an increase in average revenue per order on commercial and purchase transactions, and a shift in mix to higher premium commercial transactions. The increase in the average revenue per order closed for the nine months ended September 30, 2026 was primarily due to an increase in average revenues per order on commercial and purchase transactions, partially offset by a shift in mix to lower premium refinance transactions. The Company’s direct title operations closed 134,900 and 392,100 domestic title orders during the three and nine months ended September 30, 2026, a decrease of 4.9% and an increase of 0.4% when compared with 141,800 and 390,376 domestic title orders closed during the respective periods of the prior year, which were generally consistent with the changes in residential mortgage origination activity in the United States as reported in the MBA Forecast. Domestic residential refinance orders closed per day increased by 2.9% and 20.9% and domestic residential purchase orders closed per day decreased by 4.6% for the three and nine months ended September 30, 2026, respectively, when compared to the respective periods of the prior year.

Agent premiums were $868.4 million and $2.4 billion for the three and nine months ended September 30, 2026, respectively, increases of $69.6 million, or 8.7%, and $277.6 million, or 12.8%, when compared with the respective periods of the prior year. Agent premiums are recorded when notice of issuance is received from the agent, which is generally when cash payment is received by the Company. As a result, there is generally a delay between the agent’s issuance of a title policy and the Company’s recognition of agent premiums. Therefore, current quarter agent premiums typically reflect prior quarter mortgage origination activity. The increase in agent premiums for the three months ended September 30, 2026 is generally consistent with the 14.8% increase in the Company’s direct premiums and escrow fees in the second quarter of 2026 as compared with the second quarter of 2025.

Information and other revenues primarily consist of revenues generated from fees associated with title search and related reports, title and other real property records and images, other non-insured settlement services and risk mitigation products and services. These revenues generally trend with direct premiums and escrow fees but are typically less volatile since a portion of the revenues are subscription based and do not fluctuate with transaction volumes.

Information and other revenues were $292.2 million and $856.4 million for the three and nine months ended September 30, 2026, respectively, increases of $16.1 million, or 5.8%, and $80.0 million, or 10.3%, when compared with the respective periods of the prior year. The increases were primarily due to growth in the Company’s subservicing business, higher demand for non-insured information products and services and growth in refinance activity in the Company’s Canadian operations.

Net investment income totaled $169.3 million and $487.5 million for the three and nine months ended September 30, 2026, respectively, increases of $16.2 million, or 10.6%, and $49.6 million, or 11.3%, when compared with the respective periods of the prior year. The increases in net investment income were primarily driven by an increase in interest income from the Company’s investment portfolio, partially offset by a decline in interest income from escrow balances.

Net investment gains were $0.2 million and $39.3 million for the three and nine months ended September 30, 2026, respectively. The gains for the three and nine months ended September 30, 2026 were primarily attributable to increases in the fair values of marketable equity securities. Net investment gains of $6.4 million for the three months ended September 30, 2025, were primarily attributable to changes in the fair values of marketable equity securities, which were partially offset by impairments on capitalized internal-use software totaling $12.5 million. Net investment losses of $2.5 million for the nine months ended September 30, 2025, were primarily attributable to impairments on capitalized internal-use software totaling $48.1 million and losses recognized on sales of debt securities, partially offset by increases in the fair values of marketable equity securities.

Personnel costs were $574.1 million and $1.7 billion for the three and nine months ended September 30, 2026, respectively, increases of $31.2 million, or 5.7%, and $142.3 million, or 9.2%, when compared with the respective periods of the prior year. The increases were primarily attributable to higher incentive compensation expense due to higher revenue and profitability, and higher salaries expense.

Agents retained $695.6 million and $2.0 billion of title premiums generated by agency operations for the three and nine months ended September 30, 2026, respectively, which compares with $640.1 million and $1.7 billion for the respective periods of the prior year. The percentage of title premiums retained by agents was 80.1% and 79.9% for the three and nine months ended September 30, 2026, respectively, compared to 80.1% for the respective periods of the prior year.

Other operating expenses were $306.4 million and $902.8 million for the three and nine months ended September 30, 2026, respectively, increases of $30.8 million, or 11.2%, and $103.0 million, or 12.9%, when compared with the respective periods of the prior year. The increases were primarily due to higher production expenses on higher volumes and an increase in software expense. The increase for the nine months ended September 30, 2026, was also due to the lack of a prior year credit related to the release of an acquisition-related incentive obligation, offset by a reduction in legal expense.

The provision for policy losses and other claims, expressed as a percentage of title insurance premiums and escrow fees, was 3.0% for the three and nine months ended September 30, 2026 and 2025. The 3.0% loss provision rate for the three and nine months ended September 30, 2026 reflects an ultimate loss rate of 3.75% for the 2026 policy year and reserve releases of 0.75%, or $11.4 million and $32.5 million, respectively, for prior policy years, all based on title insurance premiums and escrow fees for the three and nine months ended September 30, 2026. The 3.0% loss provision rate for the three and nine months ended September 30, 2025 reflected an ultimate loss rate of 3.75% for the 2025 policy year and reserve releases of 0.75%, or $10.5 million and $28.8 million, respectively, for prior policy years, all based on title insurance premiums and escrow fees for the three and nine months ended September 30, 2025.

Depreciation and amortization expense was $53.3 million and $158.7 million for the three and nine months ended September 30, 2026, respectively, a decrease of $0.2 million, or 0.4%, and an increase of $2.4 million, or 1.5%, when compared with the respective periods of the prior year. The decrease for the three months ended September 30, 2026, was primarily due to lower amortization of internal-use software licenses, partially offset by higher amortization of capitalized internal-use software. The increase for the nine months ended September 30, 2026, was primarily due to higher amortization of capitalized internal-use software from recently deployed digital settlement products, partially offset by lower amortization of internal-use software licenses.

Premium taxes were $22.8 million and $63.4 million for the three and nine months ended September 30, 2026, respectively, increases of $1.9 million, or 9.1%, and $8.2 million, or 14.9%, when compared with the respective periods of the prior year. Premium taxes as a percentage of title insurance premiums and escrow fees were 1.5% for the three and nine months ended September 30, 2026, and 1.5% and 1.4% for the three and nine months ended September 30, 2025, respectively.

Interest expense was $31.3 million and $88.4 million for the three and nine months ended September 30, 2026, respectively, increases of $6.6 million, or 26.7%, and $20.9 million, or 31.0%, when compared with the respective periods of the prior year. The increases were primarily attributable to higher interest expense on depositor funds.

Pretax margins for the title insurance business reflect the high cost of performing the essential services required before insuring title, whereas the corresponding revenues are subject to regulatory and competitive pricing restraints. Due to the relatively high proportion of fixed costs in the title insurance business, pretax margins generally improve as closed order volumes increase. Pretax margins for the segment are also impacted by (1) net investment income and net investment gains or losses, which may not move in the same direction as closed order volumes, (2) the composition (residential or commercial) and type (resale, refinancing or new construction) of real estate activity and (3) the percentage of title insurance premiums generated by agency operations as margins from direct operations are generally higher than from agency operations due primarily to the large portion of the premium that is retained by the agent. The title insurance and services segment recorded pretax margins of 12.4% and 12.7% for the three and nine months ended September 30, 2026, respectively, compared with 12.9% and 11.1% in the respective periods of the prior year.

Home Warranty


	Three Months Ended September 30,												Nine Months Ended September 30,
(dollars in millions)	2026			2025			$ Change			% Change			2026			2025			$ Change			% Change
Revenues
Direct premiums	$	107.1		$	106.6		$	0.5			0.5	%	$	315.0		$	311.9		$	3.1			1.0	%
Information and other		5.8			5.7			0.1			1.8			17.9			17.8			0.1			0.6
Net investment income		1.6			1.4			0.2			14.3			4.2			3.4			0.8			23.5
Net investment gains (losses)		0.2			0.9			(0.7	)		(77.8	)		1.2			(0.5	)		1.7			340.0
		114.7			114.6			0.1			0.1			338.3			332.6			5.7			1.7
Expenses
Personnel costs		22.4			21.4			1.0			4.7			65.4			62.6			2.8			4.5
Other operating expenses		28.2			24.4			3.8			15.6			74.8			68.8			6.0			8.7
Provision for policy losses and other claims		50.2			50.0			0.2			0.4			129.1			130.5			(1.4	)		(1.1	)
Depreciation and amortization		1.3			1.3			—			—			4.1			3.9			0.2			5.1
Premium taxes		1.3			1.3			—			—			3.6			3.6			—			—
		103.4			98.4			5.0			5.1			277.0			269.4			7.6			2.8
Income before income taxes	$	11.3		$	16.2		$	(4.9	)		(30.2	)%	$	61.3		$	63.2		$	(1.9	)		(3.0	)%
Pretax margins		9.9	%		14.1	%		(4.2	)%		(29.8	)%		18.1	%		19.0	%		(0.9	)%		(4.7	)%

Direct premiums were $107.1 million and $315.0 million for the three and nine months ended September 30, 2026, respectively, increases of $0.5 million, or 0.5%, and $3.1 million, or 1.0%, when compared with the respective periods of the prior year. The increases were primarily attributable to an increase in the average price per policy.

Personnel costs and other operating expenses totaled $50.6 million and $140.2 million for the three and nine months ended September 30, 2026, respectively, increases of $4.8 million, or 10.5%, and $8.8 million, or 6.7%, when compared with the respective periods of the prior year. The increases were primarily attributable to higher advertising, software, legal, salaries and incentive compensation expenses.

The provision for home warranty losses, expressed as a percentage of home warranty premiums, was 46.9% and 41.0% for the three and nine months ended September 30, 2026, respectively, compared with 46.9% and 41.8% for the respective periods of the prior year. The decrease in the loss provision rate for the nine months ended September 30, 2026, was primarily attributable to lower claims severity, partially offset by higher claims frequency.

A large part of the revenues for the home warranty segment is generated by renewals and are not dependent on the level of real estate activity in the year of renewal. With the exception of the provision for losses, the majority of the expenses for this segment are variable in nature and, therefore, generally fluctuate with revenue. Accordingly, pretax margins (before provision for losses) are relatively constant, although, as a result of some fixed expenses, profit margins (before provision for losses) should nominally improve as premium revenues increase. Pretax margins are also impacted by net investment income and net investment gains or losses, which may not move in the same direction as premium revenues. The home warranty segment recorded pretax margins of 9.9% and 18.1% for the three and nine months ended September 30, 2026, respectively, compared with 14.1% and 19.0% in the respective periods of the prior year.

Corporate


	Three Months Ended September 30,												Nine Months Ended September 30,
(dollars in millions)	2026			2025			$ Change			% Change			2026			2025			$ Change			% Change
Revenues
Information and other	$	(0.1	)	$	—		$	(0.1	)		—	%	$	6.7		$	—		$	6.7			—	%
Net investment income (loss)		(0.8	)		9.3			(10.1	)		(108.6	)		14.5			17.9			(3.4	)		(19.0	)
Net investment gains (losses)		(2.0	)		19.1			(21.1	)		(110.5	)		(39.2	)		8.9			(48.1	)	NM1
		(2.9	)		28.4			(31.3	)		(110.2	)		(18.0	)		26.8			(44.8	)		(167.2	)
Expenses							.
Personnel costs		0.8			10.6			(9.8	)		(92.5	)		21.4			39.4			(18.0	)		(45.7	)
Other operating expenses		9.6			9.3			0.3			3.2			29.1			28.4			0.7			2.5
Provision for policy losses and other claims		(0.6	)		(1.3	)		0.7			53.8			0.9			(2.6	)		3.5			134.6
Depreciation and amortization		—			—			—			—			0.1			0.1			—			—
Interest		15.2			15.2			—			—			45.6			45.6			—			—
		25.0			33.8			(8.8	)		(26.0	)%		97.1			110.9			(13.8	)		(12.4	)%
Loss before income taxes	$	(27.9	)	$	(5.4	)	$	(22.5	)		(416.7	)%	$	(115.1	)	$	(84.1	)	$	(31.0	)		(36.9	)%

(1)

Not meaningful

Information and other revenues of $6.7 million for the nine months ended September 30, 2026 was attributable to an insurance recovery.

Net investment income (loss) totaled losses of $0.8 million and income of $14.5 million for the three and nine months ended September 30, 2026, respectively, compared with income of $9.3 million and $17.9 million in the respective periods of the prior year. The decreases were primarily attributable to fluctuations in earnings on investments associated with the Company’s deferred compensation plan.

Net investment gains (losses) totaled losses of $2.0 million and $39.2 million for the three and nine months ended September 30, 2026, respectively, compared with gains of $19.1 million and $8.9 million in the respective periods of the prior year. The losses for the three and nine months ended September 30, 2026, were due to impairment charges on non-marketable equity investments within the Company’s venture investment portfolio and, for the nine months ended September 30, 2026, were partially offset by earnings on an equity method investment. The gains for the respective periods of the prior year were primarily related to changes in the fair values of the Company’s investment in Offerpad Solutions, Inc. ("Offerpad"), a tech-enabled real estate company.

Personnel costs and other operating expenses totaled $10.4 million and $50.5 million for the three and nine months ended September 30, 2026, respectively, compared with $19.9 million and $67.8 million for the respective periods of the prior year. The decreases for the three and nine months ended September 30, 2026 were primarily attributable to lower returns on participant investments within the Company’s deferred compensation plan. The decrease for the nine months ended September 30, 2026, was also due to lower share-based compensation and severance expenses.

Eliminations

The Company’s inter-segment eliminations were not material for the three and nine months ended September 30, 2026 and 2025.

INCOME TAXES

The Company’s effective income tax rates (income tax expense as a percentage of income before income taxes) were 22.4% and 22.7% for the three and nine months ended September 30, 2026, respectively, compared with 23.1% and 23.6% for the respective periods of the prior year. The differences in the effective tax rates are primarily due to the impact on state income taxes resulting from the relative proportion of income derived from the Company’s insurance and non-insurance businesses as well as permanent differences between amounts reported for financial statement purposes and amounts reported for income tax purposes.

The Company evaluates the realizability of its deferred tax assets by assessing the valuation allowance and making adjustments to the allowance as necessary. The factors used in assessing the likelihood of realization include forecasts of future taxable income and available tax planning strategies that could be implemented. The Company’s ability to achieve forecasted taxable income in the applicable taxing jurisdictions could affect the ultimate realization of its deferred tax assets. Based on future operating results in certain jurisdictions, it is possible that the current valuation allowance positions of those jurisdictions could be adjusted during the next 12 months.

NET INCOME AND NET INCOME ATTRIBUTABLE TO THE COMPANY

Net income for the three and nine months ended September 30, 2026 was $176.6 million and $520.5 million, respectively, compared with $189.9 million and $411.8 million for the respective periods of the prior year. Net income attributable to the Company for the three and nine months ended September 30, 2026 was $177.0 million, or $1.72 per diluted share, and $520.6 million, or $5.04 per diluted share, respectively, compared with $189.6 million, or $1.84 per diluted share, and $409.9 million, or $3.95 per diluted share, for the respective periods of the prior year.

LIQUIDITY AND CAPITAL RESOURCES

Cash requirements. The Company generates cash primarily from sales of its products and services and from investment income. The Company’s current cash requirements include operating expenses, taxes, payments of principal and interest on its debt, capital expenditures, dividends on its common stock, and may include business acquisitions, investments in and loans to private companies and repurchases of its common stock. Management forecasts the cash needs of the holding company and its primary subsidiaries and regularly reviews their short-term and long-term projected sources and uses of funds, as well as the asset, liability, investment and cash flow assumptions underlying such forecasts. Based on the Company’s ability to generate cash flows from operations, its liquid-asset position and amounts available on its revolving credit facility, management believes that its resources are sufficient to satisfy its anticipated operational cash requirements and obligations for at least the next twelve months.

The substantial majority of the Company’s business is dependent upon activity in the real estate and mortgage markets, which are cyclical and seasonal. Periods of increasing interest rates and reduced affordability, supply and mortgage financing availability generally have an adverse effect on residential real estate activity and, therefore, typically decrease the Company’s revenues. In contrast, periods of declining interest rates and increased affordability, supply and mortgage financing availability generally have a positive effect on residential real estate activity, which typically increases the Company’s revenues. Residential purchase activity is typically slower in the winter months with increased volumes in the spring and summer months. Residential refinance activity is typically more volatile than purchase activity and is highly impacted by changes in interest rates. Commercial real estate volumes are less sensitive to changes in interest rates but fluctuate based on local supply and demand conditions for space and financing availability.

Cash provided by operating activities totaled $600.2 million and $581.5 million for the nine months ended September 30, 2026 and 2025, respectively, after claim payments, net of recoveries, of $287.1 million and $261.4 million, respectively. The principal nonoperating uses of cash and cash equivalents for the nine months ended September 30, 2026 and 2025 were advances and repayments related to secured financing transactions, purchases of debt and equity securities, capital expenditures, dividends to common stockholders, and repurchases of company common shares. The principal nonoperating sources of cash and cash equivalents for the nine months ended September 30, 2026 and 2025 were borrowings and collections related to secured financing transactions, proceeds from the sales and maturities of debt and equity securities and increases in the deposit balances at the Company’s banking operations. The net effects of all activities on cash and cash equivalents were increases of $343.8 million and $1.2 billion for the nine months ended September 30, 2026 and 2025, respectively.

The Company continually assesses its capital allocation strategy, including decisions relating to dividends, stock repurchases, capital expenditures, acquisitions and investments. In September 2026, the Company’s board of directors declared a quarterly cash dividend of 61 cents per common share, representing an 11 percent increase. The dividend increase was effective for the September 2026 dividend and paid in October 2026. Management expects that the Company will continue to pay quarterly cash dividends at or above the current level. The timing, declaration and payment of future dividends, however, fall within the discretion of the Company’s board of directors and will depend upon many factors, including the Company’s financial condition and earnings, the capital requirements of the Company’s businesses, restrictions imposed by applicable law and any other factors the board of directors deems relevant from time to time.

Holding Company. First American Financial Corporation is a holding company that conducts all of its operations through its subsidiaries. The holding company’s current cash requirements include payments of principal and interest on its debt, taxes, payments in connection with employee benefit plans, dividends on its common stock and other expenses. The holding company is dependent upon dividends and other payments from its operating subsidiaries to meet its cash requirements. The Company’s target is to maintain a cash balance at the holding company equal to at least twelve months of estimated cash requirements. At certain points in time, the actual cash balance at the holding company may vary from this target due to, among other factors, the timing and amount of cash payments made and dividend payments received. Pursuant to insurance and other regulations under which the Company’s insurance subsidiaries operate, the amount of dividends, loans and advances available to the holding company is limited, principally for the protection of policyholders. As of September 30, 2026 under such regulations, the maximum amount available to the holding company from its insurance subsidiaries for the remainder of 2026, without prior approval from applicable regulators, was dividends of $277.9 million and loans and advances of $113.6 million. However, the timing and amount of dividends paid by the Company’s insurance subsidiaries to the holding company falls within the discretion of each insurance subsidiary’s board of directors and will depend upon many factors, including the level of total statutory capital and surplus required to support minimum financial strength ratings by certain rating agencies. Such restrictions have not had, nor are they expected to have, an impact on the holding company’s ability to meet its cash obligations.

As of September 30, 2026 the holding company’s sources of liquidity included $355.4 million of cash and cash equivalents and $900.0 million available on the Company’s revolving credit facility. Management believes that liquidity at the holding company is sufficient to satisfy anticipated cash requirements and obligations for at least the next twelve months.

Financing. The Company maintains a senior unsecured credit agreement with JPMorgan Chase Bank, N.A., in its capacity as administrative agent, and the lenders party thereto that provides for a $900.0 million revolving credit facility. The credit agreement includes an expansion option that permits the Company, subject to satisfaction of certain conditions, to increase the revolving commitments and/or add term loan tranches in an aggregate amount not to exceed $450.0 million. The obligations of the Company under the credit agreement are neither secured nor guaranteed. Proceeds from borrowings made from time to time under the credit agreement may be used for general corporate purposes. Unless terminated earlier, the credit agreement will terminate on May 17, 2028. At September 30, 2026, the Company had no outstanding borrowings under the facility.

In addition to amounts available under its credit facility, certain subsidiaries of the Company maintain separate financing arrangements. The primary financing arrangements maintained by subsidiaries of the Company are as follows:

•

FirstFunding, Inc., a specialized warehouse lender to correspondent mortgage lenders, maintains secured warehouse lending facilities with several banking institutions. At September 30, 2026, outstanding borrowings under these facilities totaled $807.5 million.

•

First American Trust, FSB (“FA Trust”), a federal savings bank, maintains a secured line of credit with the Federal Home Loan Bank and maintains access to the Federal Reserve's Discount Window. At September 30, 2026, no amounts were outstanding under any of these facilities.

•

First Canadian Title Company Limited, a Canadian title insurance and services company, maintains credit facilities with certain Canadian banking institutions. At September 30, 2026, no amounts were outstanding under these facilities.

The Company’s debt to capitalization ratios were 30.3% and 30.7% at September 30, 2026 and December 31, 2025, respectively. The Company’s adjusted debt to capitalization ratios, excluding secured financings payable of $807.5 million and $906.5 million at September 30, 2026 and December 31, 2025, were 22.2% and 21.9%, respectively.

Investment Portfolio. The Company maintains a high quality, liquid investment portfolio that is primarily held at its insurance and banking subsidiaries. As of September 30, 2026, 95% of the Company’s investment portfolio consisted of debt securities, of which 74% were either United States government-backed or rated AAA and 98% were either rated or classified as investment grade or better. Percentages are based on the estimated fair values of the securities. Credit ratings reflect published ratings obtained from globally recognized securities rating agencies. If a security was rated differently among the rating agencies, the lowest rating was selected. For further information on the credit quality of the Company’s debt securities portfolio at September 30, 2026, see Note 3 Debt Securities to the condensed consolidated financial statements.

In addition to its debt and marketable equity securities portfolio, the Company maintains investments in non-marketable equity securities and securities accounted for under the equity method. For further information on the Company’s equity securities, see Note 4 Equity Securities to the condensed consolidated financial statements.

Off-balance sheet arrangements. The Company administers escrow deposits as a service to customers in its direct title operations. Escrow deposits totaled $10.0 billion and $9.3 billion at September 30, 2026 and December 31, 2025, respectively, of which $4.1 billion and $3.7 billion, respectively, were held at FA Trust. The remaining deposits were held at third-party financial institutions. Escrow deposits held at third-party financial institutions are not considered assets of the Company and are not included in the accompanying condensed consolidated balance sheets. All such amounts are placed in deposit accounts insured, up to applicable limits, by the Federal Deposit Insurance Corporation. The Company could be held contingently liable for the disposition of these assets.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

The Company’s primary exposure to market risk relates to interest rate risk associated with certain financial instruments. Although the Company monitors its risk associated with fluctuations in interest rates, it does not currently use derivative financial instruments on any significant scale to hedge these risks.

There have been no material changes in the Company’s market risks since the filing of its Annual Report on Form 10-K for the year ended December 31, 2025.

Item 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

The Company’s chief executive officer and chief financial officer have concluded that, as of September 30, 2026, the end of the quarterly period covered by this Quarterly Report on Form 10-Q, the Company’s disclosure controls and procedures, as defined in Rule 13a-15(e) of the Securities Exchange Act of 1934, as amended, were effective, based on the evaluation of these controls and procedures required by Rule 13a-15(b) thereunder.

Changes in Internal Control Over Financial Reporting

There was no change in the Company’s internal control over financial reporting during the quarter ended September 30, 2026, that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II: OTHER INFORMATION

Item 1. Legal Proceedings.

See Note 16 Litigation and Regulatory Contingencies to the condensed consolidated financial statements included in “Item 1. Financial Statements (unaudited)” of Part I of this report, which is incorporated by reference into this Item 1 of Part II.

Item 1A. Risk Factors.

In addition to the information set forth in this Quarterly Report on Form 10-Q, you should carefully consider the “Risk Factors” disclosed under “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2025 and our Quarterly Report on Form 10-Q for the quarter ended June 30, 2026.

Except as set forth in our Quarterly Report on Form 10-Q for the quarter ended June 30, 2026, there have been no material changes as of the date of this report to the risk factors disclosed in “Item 1A. Risk Factors” included in our Annual Report on Form 10-K for the year ended December 31, 2025.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

Unregistered Sales of Equity Securities

During the quarter ended September 30, 2026, the Company did not issue any unregistered common stock.

Purchases of Equity Securities by the Issuer and Affiliated Purchasers

In July 2025, the Company’s board of directors authorized the repurchase of up to $300.0 million of the Company’s issued and outstanding common stock. The authorization does not have an expiration date. The following table describes purchases by the Company under the share repurchase program that settled during each period set forth in the table. Prices in column (b) include commissions. Cumulatively, as of September 30, 2026, the Company had repurchased $55.5 million (including commissions) of its shares authorized under the share repurchase program and had the authority to repurchase an additional $244.5 million (including commissions) under that program.


	(a) Total Number of Shares Purchased		(b) Average Price Paid per Share		(c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs		(d) Maximum Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs
July 1 to July 31, 2026		—	$	—		—	$	246,021,253
August 1 to August 31, 2026		—		—		—		246,021,253
September 1 to September 30, 2026		23,149		64.24		23,149		244,534,079
Total		23,149	$	64.24		23,149	$	244,534,079

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

(a)

None.

(b)

Not applicable.

(c)

During the quarter ended September 30, 2026, no director or Section 16 officer adopted or terminated any Rule 10b5-1 trading arrangements or non-Rule 10b5-1 trading arrangements (in each case, as defined in Item 408(a) of Regulation S-K).

Item 6. Exhibits.


Exhibit No.	Description	Location

3.1	Restated Certificate of Incorporation of First American Financial Corporation, effective as of May 14, 2026.	Incorporated by reference herein to Exhibit 3.2 to the Current Report on Form 8-K filed May 15, 2026.

3.2	Bylaws of First American Financial Corporation, amended and restated effective as of May 14, 2026.	Incorporated by reference herein to Exhibit 3.3 to the Current Report on Form 8-K filed May 15, 2026.

31(a)	Certification by Chief Executive Officer Pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934.	Attached.

31(b)	Certification by Chief Financial Officer Pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934.	Attached.

32(a)	Certification by Chief Executive Officer Pursuant to 18 U.S.C. Section 1350.	Attached.

32(b)	Certification by Chief Financial Officer Pursuant to 18 U.S.C. Section 1350.	Attached.

101.INS	Inline XBRL Instance Document. The instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.	N/A.

101.SCH	Inline XBRL Taxonomy Extension Schema With Embedded Linkbases Document.	N/A.

104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).	N/A.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


	FIRST AMERICAN FINANCIAL CORPORATION (Registrant)

Date: October 22, 2026	By	/s/ Mark E. Seaton
		Mark E. Seaton
		Chief Executive Officer (Principal Executive Officer)

Date: October 22, 2026	By	/s/ Matthew F. Wajner
		Matthew F. Wajner
		Chief Financial Officer (Principal Financial Officer)