Arch Capital tops Q3 profit estimates and beats on revenue

Arch Capital Group Ltd. (ACGL) said on Oct. 27 that its after-tax operating income for the third quarter of 2026 was $910 million, or $2.67 per share, down from $1.0 billion, or $2.77 per share, a year earlier. The figure topped the $2.33 consensus estimate compiled by Finnhub.

Shares were little changed in after-hours trading as of 5:10 p.m. ET, from a regular-session close of $100.36.

Total revenue was $4.655 billion, according to the company's financial supplement, beating the $4.24 billion estimate. It was down from $5.109 billion a year earlier.

Here's how the company did:

• After-tax operating income: $2.67 per share vs. $2.77 a year earlier, topping the $2.33 consensus estimate compiled by Finnhub
• Net income available to common shareholders: $3.00 per share vs. $3.56 a year earlier
• Total revenue: $4.655 billion vs. $5.109 billion a year earlier, against the $4.24 billion consensus estimate compiled by Finnhub
• Net premiums written: $3.845 billion vs. $3.964 billion a year earlier
• Underwriting income: $702 million vs. $871 million a year earlier
• Combined ratio: 82.5% vs. 79.8% a year earlier

Underwriting results

Net premiums earned fell 6.3% from a year earlier to $4.014 billion. Net premiums written fell 3.0% to $3.845 billion, and gross premiums written were $5.391 billion, down 0.4%.

The company's pre-tax current accident year catastrophic losses were $234 million, net of reinsurance and reinstatement premiums. The insurance segment's loss ratio included losses related to the Iran conflict. Favorable development in prior year loss reserves, net of related adjustments, was $179 million.

Underwriting income fell in all three segments. Insurance underwriting income was $108 million, against $129 million a year earlier. Reinsurance underwriting income was $393 million, against $482 million. Mortgage underwriting income was $201 million, against $260 million.

Investment results

Pre-tax net investment income rose to $451 million from $408 million a year earlier. The company said the increase reflected growth in average investable assets.

The company recorded net realized losses of $99 million, compared with net realized gains of $210 million a year earlier. Its total return on investments was negative 0.42% for the quarter.

Capital and buybacks

The company repurchased $1.4 billion of its shares during the quarter. Book value per common share was $67.90 at Sept. 30, down 0.2% from June 30, 2026.

Interest expense rose to $62 million from $37 million a year earlier. The company said the increase primarily resulted from its June 2026 capital raising activity.

Management comment

CEO Nicolas Papadopoulo said, "We delivered a strong quarter, driven by solid underwriting performance across our three segments and continued strength from our investment portfolio." He added, "We are operating in a transitioning market where conditions are increasingly uneven, but we are prepared and welcome the challenge."

The release contains no new financial guidance. The company will hold a conference call for investors and analysts at 10:00 a.m. Eastern Time on Oct. 28, 2026.

Arch Capital Group Ltd. is a publicly listed Bermuda exempted company with approximately $27.3 billion in capital at Sept. 30, 2026. It provides insurance, reinsurance and mortgage insurance on a worldwide basis through its wholly owned subsidiaries.