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American Realty (NYSE: ARL) swings to Q2 loss on higher operating expenses

Filing Impact
(High)
Filing Sentiment
(Neutral)
Form Type
8-K

Rhea-AI Filing Summary

American Realty Investors, Inc. reported a net loss attributable to common shares of $1.0 million, or $(0.06) per share, for the quarter ended June 30, 2026, compared with net income of $2.8 million, or $0.18 per share, for the same period in 2025. Total revenue increased to $12.9 million from $12.2 million, mainly from higher rental income at multifamily and commercial properties as lease-up continued at newer developments.

Net operating loss increased $1.5 million, primarily due to a $1.6 million rise in operating expenses at lease-up properties. The move from profit to loss also reflects a $1.6 million decrease in interest income, net, partially offset by a $1.3 million reduction in income tax provision. Overall occupancy was 81% at June 30, 2026, including 93% at multifamily and 58% at commercial properties. During the quarter, the company sold 21 residential lots at Windmill Farms for $1.0 million, generating a gain on sale of $0.8 million.

Positive

  • None.

Negative

  • Profitability reversed: Q2 2026 shifted to a $1.0 million net loss attributable to common shares from $2.8 million net income a year earlier, driven by higher operating expenses at lease-up properties and lower net interest income, only partly offset by a reduced tax provision.

Filing Explained

Through June 30, 2026, ARL reported a $1,561 thousand six-month loss attributable to common shares, versus $5,792 thousand income.

Form 8-Ks report specified material events within four business days; this filing furnishes American Realty Investors, Inc.’s results for the quarter ended June 30, 2026 under Item 2.02.

For existing common holders, the six-month result attributable to common shares was a loss of $1,561 thousand, compared with income of $5,792 thousand for the same period in 2025.

The company states that the Item 2.02 information and Exhibit 99.1 are furnished rather than filed for Section 18 purposes unless incorporated by reference.

For the six months ended June 30, 2026, the statement lists $25,207 thousand of total revenue, $29,947 thousand of total operating expenses, and a $4,740 thousand net operating loss, compared with a $1,826 thousand net operating loss in 2025.

Item 2.02 Results of Operations and Financial Condition Financial
Disclosure of earnings results, typically an earnings press release or preliminary financials.
Item 9.01 Financial Statements and Exhibits Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
Total revenue Q2 2026 12,866 (thousands of dollars) Three months ended June 30, 2026 total revenue
Total revenue Q2 2025 12,160 (thousands of dollars) Three months ended June 30, 2025 total revenue
Net (loss) income attributable to common shares Q2 2026 (1,010) (thousands of dollars) Three months ended June 30, 2026 net loss attributable to common
Net income attributable to common shares Q2 2025 2,827 (thousands of dollars) Three months ended June 30, 2025 net income attributable to common
Basic and diluted EPS Q2 2026 $(0.06) Earnings per share for the quarter ended June 30, 2026
Total occupancy 81% Portfolio occupancy at June 30, 2026
Multifamily occupancy 93% Multifamily property occupancy at June 30, 2026
Commercial occupancy 58% Commercial property occupancy at June 30, 2026
net operating loss financial
"Net operating loss increased $1.5 million from $1.0 million for the three months"
A net operating loss is when a company’s deductible expenses exceed its taxable income for a period, producing an official tax loss that can be used to reduce future taxable income and lower future cash taxes. For investors it matters because these tax credits are like a savings account of losses the company can “spend” later to boost after‑tax cash flow, which can raise the value of the business—though rules can limit how and when those losses are used.
equity in loss from unconsolidated joint ventures financial
"Equity in loss from unconsolidated joint ventures | 412 | | | 19"
noncontrolling interest financial
"Net loss (income) attributable to noncontrolling interest | 235 | | | (37)"
The portion of a business owned by investors other than the controlling owner when one company has control of another; it represents outside shareholders’ share of the subsidiary’s assets and profits. For investors, it matters because those outside claims reduce the amount of profit and net assets attributable to the parent owner — similar to saying part of a pizza belongs to someone else — and thus affects earnings, book value and valuation.
Q2 2026 total revenue $12.9 million up from $12.2 million in Q2 2025
Q2 2026 net (loss) income attributable to common shares $(1.0) million from $2.8 million net income in Q2 2025
Q2 2026 basic and diluted EPS $(0.06) from $0.18 in the prior-year quarter
Six months 2026 net (loss) income attributable to common shares 1,561 (thousands of dollars) from 5,792 (thousands of dollars) in the first half of 2025

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FAQ

What were American Realty Investors' (ARL) Q2 2026 earnings?
American Realty Investors reported a net loss of $1.0 million, or $(0.06) per share, in Q2 2026, versus $2.8 million, or $0.18 per share, net income in Q2 2025. The change reflects higher operating expenses and lower net interest income, partly offset by a lower tax provision.

How did ARL's Q2 2026 revenue compare to Q2 2025?
Quarterly revenue rose to $12.9 million in Q2 2026 from $12.2 million in Q2 2025. The $0.7 million increase was primarily due to higher rental revenues, including $0.5 million from multifamily properties and $0.2 million from commercial properties as occupancy improved.

What drove the increase in ARL's net operating loss in Q2 2026?
Net operating loss increased by $1.5 million in Q2 2026, mainly due to a $1.6 million rise in operating expenses at lease-up properties. This expense growth outweighed modest revenue gains and contributed significantly to the movement from $2.8 million net income to a $1.0 million net loss year over year.

What were American Realty Investors' occupancy levels at June 30, 2026 (ARL)?
Overall portfolio occupancy was 81% at June 30, 2026, including 93% at multifamily properties and 58% at commercial properties. Development properties Alera, Bandera Ridge and Merano reported occupancies of 86%, 85% and 77%, respectively, reflecting ongoing lease-up activity.

What property sales did ARL complete in Q2 2026?
During Q2 2026, American Realty Investors sold 21 lots from its Windmill Farms holdings for $1.0 million. The transaction generated a $0.8 million gain on sale, contributing to total gain on real estate transactions of $0.814 million for the quarter.

How did ARL's first-half 2026 results compare with first-half 2025?
For the six months ended June 30, 2026, ARL recorded a net loss attributable to common shares of 1,561 (thousands of dollars), versus net income of 5,792 (thousands of dollars) in 2025. Total revenue increased from 24,168 to 25,207 (thousands of dollars), while net operating loss and interest expense both rose.
0001102238false00011022382026-08-062026-08-06

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K
Current Report

Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)August 6, 2026

American Realty Investors, Inc.
(Exact name of registrant as specified in its charter)

Nevada001-1566375-2847135
(State or other jurisdiction of 
Incorporation or organization) 		(Commission File Number)(IRS Employer Identification Number)
1603 LBJ Freeway,Suite 800DallasTX75234
(Address of principal executive offices)(Zip Code)
(469) 522-4200
Registrant’s Telephone Number, including area code

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the Registrant under any of the following provisions:
 ☐  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 ☐  Soliciting material pursuant to Rule 14a-12 under the Securities Act (17 CFR 230.425)
 ☐  Pre-commencement communications pursuant to Rule 14d-2(b) under the Securities Act (17 CFR 240.14d-2(b))
 ☐  Pre-commencement communications pursuant to Rule 13e-4(c) under the Securities Act (17 CFR 240.413e-4(c))

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common StockARLNYSE
Indicate by check mark whether the Registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 ((17 CFR 230.405 of or Rule 12b-2 of the Securities Act of 1934 (17 CFR 230.405):
☐  Emerging growth company
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. ☐



Section 2 – Financial Information

Item 2.02. Results of Operations and Financial Condition

On August 6, 2026, American Realty Investors, Inc. (“ARL” or the “Company”) announced its operational results for the quarter ended June 30, 2026. A copy of the announcement is attached as Exhibit “99.1.”

The information furnished pursuant to Item 2.02 in this Form 8-K, including Exhibit “99.1” attached hereto, shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that Section, unless we specifically incorporate it by reference in a document filed under the Securities Act of 1933 or the Securities Exchange Act of 1934. We undertake no duty or obligation to publicly update or revise the information furnished pursuant to Item 2.02 of this Current Report on Form 8-K.

Section 9 – Financial Statements and Exhibits

Item 9.01. Financial Statements and Exhibits


(d) Exhibits.

The following exhibit is furnished with this Report:

Exhibit No.Description
99.1*
Press release datedAugust 6, 2026
_________________________
* Furnished herewith






SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
AMERICAN REALTY INVESTORS, INC.
Dated: August 6, 2026By:/s/ ERIK L. JOHNSON
Erik L. Johnson
President and Chief Executive Officer



NEWS RELEASEContact:
American Realty Investors, Inc. Investor Relations
FOR IMMEDIATE RELEASE
Erik Johnson (469) 522-4200 investor.relations@americanrealtyinvest.com


American Realty Investors, Inc. reports Earnings for Q2 2026

DALLAS (August 6, 2026) -- American Realty Investors, Inc. (NYSE:ARL) is reporting its results of operations for the three months ended June 30, 2026. For the three months ended June 30, 2026, we reported net loss attributable to common shares of $1.0 million or $0.06 per share, compared to a net income attributable to common shares of $2.8 million or $0.18 per share for the same period in 2025.

Financial Highlights

•Total occupancy was 81% at June 30, 2026, which includes 93% at our multifamily properties and 58% at our commercial properties.
•Occupancy for our Alera, Bandera Ridge and Merano (collectively, our “Development Properties”) at June 30, 2026 was 86%, 85% and 77%, respectively.
•During the three months ended June 30, 2026, we sold 21 lots from our holdings in Windmill Farms for $1.0 million, resulting in a gain on sale of $0.8 million.

Financial Results

Revenues increased $0.7 million from $12.2 million for the three months ended June 30, 2025 to $12.9 million for the three months ended June 30, 2026. The increase in revenue is primarily due to an increase of $0.5 million from our multifamily properties and $0.2 million from our commercial properties. The increase in revenue from our multifamily properties is due to the lease-up of our Development Properties and the increase from our commercial properties is primarily due to an increase in occupancy at Stanford Center.

Net operating loss increased $1.5 million from $1.0 million for the three months ended June 30, 2025 to $2.5 million for the three months ended June 30, 2026. Our increase in net operating loss was primarily due to a $1.6 million increase in operating expenses from the lease-up properties for the three months ended June 30, 2026.

Net (loss) income attributable to common shares changed approximately $3.8 million from net income of $2.8 million for the three months ended June 30, 2025 to a net loss of $1.0 million for the three months ended June 30, 2026. The decrease in net income is primarily attributed to a $1.5 million increase in net operating loss and a $1.6 million decrease in interest income, net offset in part by a $1.3 million decrease in tax provision.





About American Realty Investors, Inc.
American Realty Investors, Inc., a Dallas-based real estate investment company, holds a diverse portfolio of equity real estate located across the U.S., including office buildings, apartments, shopping centers, and developed and undeveloped land. The Company invests in real estate through direct ownership, leases and partnerships and invests in mortgage loans on real estate. The Company also holds mortgage receivables. The Company’s primary asset and source of its operating results is its investment in Transcontinental Realty Investors, Inc. (NYSE:TCI). For more information, visit the Company’s website at www.americanrealtyinvest.com.


AMERICAN REALTY INVESTORS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in thousands, except per share amounts)
(Unaudited)
Three Months Ended June 30,Six Months Ended June 30,
2026202520262025
Revenues:
Rental revenues$12,236 $11,510 $23,892 $22,937 
Other income630 650 1,315 1,231 
   Total revenue12,866 12,160 25,207 24,168 
Expenses:
Property operating expenses8,176 6,535 15,509 12,512 
Depreciation and amortization3,697 3,062 7,327 5,945 
General and administrative1,498 1,534 2,984 3,026 
Advisory fee to related party2,044 2,042 4,127 4,511 
   Total operating expenses15,415 13,173 29,947 25,994 
   Net operating loss(2,549)(1,013)(4,740)(1,826)
Interest income2,810 3,353 6,634 7,363 
Interest expense(2,803)(1,777)(5,771)(3,597)
Equity in loss from unconsolidated joint ventures412 19 412 (140)
Gain on real estate transactions814 947 1,199 4,838 
Income tax provision71 1,335 505 189 
Net (loss) income(1,245)2,864 (1,761)6,827 
Net loss (income) attributable to noncontrolling interest235 (37)200 (1,035)
Net (loss) income attributable to common shares$(1,010)$2,827 $(1,561)$5,792 
Earnings per share
Basic and diluted$(0.06)$0.18 $(0.10)$0.36 
Weighted average common shares used in computing earnings per share
Basic and diluted16,152,043 16,152,043 16,152,043 16,152,043 



Source: View Original Filing on SEC EDGAR

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