Prospect Capital (PSEC) Q4 2026 earnings summary

Executive summary

• Net Investment Income (NII) for the June quarter was $78 million, or $0.15 per share, consistent with the prior quarter, though down from $0.16 in the previous quarter and $0.17 year-over-year.

• Net Asset Value (NAV) stood at $2.9 billion, or $5.71 per share, as of June 30, down from $6.56 a year ago.

• Monthly common shareholder distributions of $0.035 per share were declared for September and October, with cumulative distributions since IPO totaling over $4.8 billion, or $22.14 per share.

• Net loss applicable to common shareholders was $38.1 million, or $(0.08) per share, compared to net income of $26.4 million in the prior quarter.

• Closed the sale of Valley Electric Company, Inc. for $328 million on July 1, 2026.

Financial highlights

• Total investment income for the quarter was $155.8 million, with $140.4 million from interest income and $11.3 million from dividends.

• Net debt to total assets ratio was 28.6% as of June 30, 2026.

• Unsecured debt plus unsecured perpetual preferred represented 83.7% of total debt plus preferred.

• Aggregate investments in NPRC included a $185 million unrealized gain as of June.

• Interest income for the 12 months ending June 2026 was 91% of total investment income.

Outlook and guidance

• AI and automation initiatives are expected to deliver tens of millions in annualized cash flow benefit, with further upside potential.

• Continued focus on first lien senior secured middle market loans, with first lien mix rising to 72.5% at cost.

• Ongoing asset rotation into core lending business and exits from lower-yielding and subordinated assets.