Executive Summary

Core net investment income per share was $0.35, covering the $0.315 quarterly dividend; GAAP NII per share was $0.19 and adjusted NII per share was $0.22 . NAV per share ended the quarter at $6.51 .
Cash yield on quarterly CLO distributions was 23.11%, equating to $0.55 of recurring cash flows per share; 12% of the portfolio deferred payments due to resets/refis and primary issuances not yet distributing .
Portfolio GAAP yield eased to 15.11% vs 16.48% in Q2 2025; OC cushions remained healthy at a 4.50% weighted average with no holdings below 2.50% .
Capital actions included a new $30M SOFR + 3.25% credit facility (upsizable to $50M), $9.2M of ATM issuance at a premium to NAV, and $5M Series B convertible preferreds converted to common at a premium to NAV .
Near-term stock reaction catalysts: monthly NAV updates showed $6.52 at July 31 and $6.27 at August 31, evidencing valuation sensitivity to market spreads; dividend stability and reset activity could support sentiment .

What Went Well and What Went Wrong

What Went Well

Dividend coverage and cash generation: CNII per share of $0.35 and recurring cash flows per share of $0.55 supported the $0.105 monthly dividend declared for September–November .
Portfolio resiliency and manager discipline: “We believe our third quarter performance reflects CCIF's resilience… we selectively deployed capital, completed two opportunistic resets, and maintained a stable monthly dividend that is covered by core net investment income.” — Nishil Mehta, President .
Balance sheet flexibility and accretive capital: Entered a $30M credit facility at SOFR + 3.25%, executed $9.2M ATM issuance at a premium to NAV (+$0.01 NAV accretion), and converted $5M of 7.125% Series B preferreds at a premium to NAV .

What Went Wrong

Profitability compression: GAAP NII per share declined to $0.19 from $0.23 in Q2 and $0.26 in Q1; adjusted NII per share fell to $0.22 vs $0.26 in Q2 .
Mark-to-market headwinds: Net realized and change in unrealized losses were $(6.6)M in Q3, after $(7.1)M in Q2, reflecting spread/valuation volatility in CLO equity and underlying loans .
Yield moderation and payment deferrals: Portfolio weighted average GAAP yield declined to 15.11% (from 16.48% in Q2); 12% of the portfolio did not make payments as cash was diverted to resets/refis and certain primary issuances had not made initial distributions .

Financial Results

Income Statement and Per-Share Metrics (Quarterly, $USD Thousands except per share)

Metric	Q1 2025	Q2 2025	Q3 2025
Total Investment Income	$8,269	$8,565	$8,609
Total Expenses	$4,177	$4,537	$4,682
Net Investment Income (NII)	$4,092	$4,028	$3,927
Net Realized and Change in Unrealized Gains (Losses)	$(2,967)	$(7,130)	$(6,599)
Net Income (Loss)	$1,125	$(3,102)	$(2,672)
NII per Share	$0.26	$0.23	$0.19
Net Income (Loss) per Share	$0.09	$(0.17)	$(0.13)
Adjusted NII per Share	$0.27	$0.26	$0.22
Core NII per Share	$0.45	$0.27	$0.35
Recurring Cash Flows per Share	$0.70	$0.49	$0.55

Balance Sheet and Portfolio

Metric	Q1 2025	Q2 2025	Q3 2025
Total Investments at Fair Value ($MM)	$177.9	$197.9	$200.4
Net Assets ($MM)	$125.0	$132.0	$137.7
NAV per Common Share	$7.44	$6.98	$6.51
Preferred Equity Principal ($MM)	$63.5	$80.5	$75.5
Debt ($MM)	$0	$0	$0

KPIs and Credit Quality

KPI	Q1 2025	Q2 2025	Q3 2025
Portfolio Weighted Avg GAAP Yield	17.22%	16.48%	15.11%
Cash Yield on Quarterly CLO Distributions	25.15%	22.67%	23.11%
Weighted Avg Junior OC Cushion	4.18%	4.46%	4.50%
S&P CCC-rated Obligors (% of loans)	5.35%	5.17%	4.39%
Weighted Avg Stated Loan Spread	3.38%	3.26%	3.25%
Underlying Loan Market Price (Wtd Avg)	97.83	96.53	97.31
Remaining CLO Reinvestment Period (Wtd Avg, years)	2.5	3.1	3.3

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Common Dividend per Month	Jun–Aug 2025	$0.105 declared	—	—
Common Dividend per Month	Sep–Nov 2025	—	$0.105 declared	Maintained
Recurring Cash Flows per Share	Q3 2025	~$0.62 outlook (from Q2 deck)	$0.55 actual	Lower than outlook
Recurring Cash Flows per Share	Q4 2025	—	~$0.51 outlook	New guidance
Financing Capacity	As of 7/11/25	—	$30M SOFR + 3.25% facility; upsizable to $50M	Added liquidity
Preferred Dividend per Month (CCIA)	Sep–Nov 2025	—	$0.1823 declared	Initiated period declaration

Earnings Call Themes & Trends

Topic	Previous Mentions (Q1 & Q2)	Current Period (Q3 2025)	Trend
Loan repricing impact	2024 repricings reduced spreads ~25 bps; drove unrealized losses; resets/refis used to lower CLO liability costs	12 bps decline in underlying spreads earlier; repricings halted amid volatility; cash yield supported	Easing repricing pressure, improving cash metrics
Resets/Refis cadence	13 accretive resets/refis in Q2; extended reinvestment periods to ~3.1 years	Two opportunistic resets completed; reinvestment period avg 3.3 years	Continued active optimization
Macro/tariffs	Tariffs widened CLO liabilities; volatility increased; expected slowdown in resets until spreads tighten	Management highlighted portfolio resilience in complex environment	Volatility persists; portfolio positioned defensively
Credit quality/defaults	Market LTM default (incl. distressed exchanges) ~4–4.5%; CCIF portfolio ~1.3–1.5%	CCC buckets and OC cushions remain healthy; none below 2.50% OC	Credit metrics stable to improving
Dividend coverage	CNII covered dividends; Q2 recurring cash flows $0.49; outlook for Q3 ~$0.62	CNII $0.35; recurring cash flows $0.55; dividend maintained	Coverage sustained, slightly below prior outlook

Management Commentary

“We believe our third quarter performance reflects CCIF's resilience… we selectively deployed capital, completed two opportunistic resets, and maintained a stable monthly dividend that is covered by core net investment income.” — Nishil Mehta, President .
“Our second quarter results reflect the resilient nature of the loan and CLO market amidst a shifting macroeconomic environment… we have maintained a stable monthly dividend, continue to scale the fund via capital markets activity, and will seek to actively manage the portfolio throughout the rest of the year.” — Nishil Mehta, PEO/President .
“Our first quarter results reflect strong momentum as we entered 2025 following a record year of issuance in the CLO market… Fundamentals in the CLO market remain strong and our private placement of convertible preferred shares… provides the fund with net proceeds to fuel a strong year of investment activity.” — Lauren Basmadjian, CEO .

Q&A Highlights

Cash flow dynamics and repricing: Management clarified a 12 bps spread decline from repricings and noted 18% of the portfolio diverted payments to fund accretive resets/refis; repricing activity had halted quarter-to-date, easing the drag .
Out-of-court restructurings: Elevated vs historical; industry effects are idiosyncratic but vintage (2021 leverage) is a bigger driver; strong interest coverage metrics mitigate risk .
Primary vs secondary opportunities: Relative value seen as roughly equal post-widening retracement; targeting low- to mid-teens expected returns with ample reinvestment period .
CLO liquidation/call actions: A 2021 vintage CLO was called due to underperformance; no broader liquidation plans given current loan price backdrop .
NAV volatility and equity bids: April NAV decline attributed to loan price drops and higher valuation yields; daily marks showed rebound as markets recovered; volatility can benefit CLO equity via wider asset spreads and par build .

Estimates Context

Q2 2025 EPS vs consensus: Actual $0.23 vs Primary EPS Consensus Mean $0.2625 — bold miss of $0.03 per share (EPS)*.
Q1 2025 EPS vs consensus: Actual $0.44 vs Primary EPS Consensus Mean $0.2975 — bold beat of $0.14 per share (EPS)*.
Revenue vs consensus: Q2 consensus $9.04M* vs reported investment income $8.565M — miss; Q1 consensus $8.215M* vs reported $8.269M — slight beat .
Q3 2025 Wall Street consensus (EPS/Revenue): Not available via SPGI at time of analysis.

Values marked with an asterisk (*) retrieved from S&P Global.

Estimates vs Actuals (Quarterly)

Metric	Q1 2025 Consensus*	Q1 2025 Actual	Q2 2025 Consensus*	Q2 2025 Actual	Q3 2025 Consensus*
Primary EPS Consensus Mean	$0.2975*	$0.44	$0.2625*	$0.23	N/A*
Revenue Consensus Mean ($MM)	$8.215*	$8.269	$9.041*	$8.565	N/A*

Key Takeaways for Investors

Dividend appears sustainably covered by CNII ($0.35 vs $0.315), with recurring cash flows of $0.55 per share supporting payout stability .
Underlying credit quality remains robust (OC cushions 4.50%, CCC exposure 4.39%) providing loss-absorbing capacity in continued volatility .
Yield moderation is a reality (portfolio GAAP yield 15.11% vs 16.48% prior) as repricing waves compress spreads, but resets/refis and reinvestment periods provide tools to offset over time .
Near-term NAV sensitivity persists (July $6.52, August $6.27), suggesting price reactions will track loan spreads and valuation yield assumptions; monitor monthly NAV disclosures .
Liquidity and deployment optionality improved via the $30M credit facility (SOFR + 3.25%) and accretive ATM issuance, enabling opportunistic resets and secondary purchases .
Q2 misses vs consensus (EPS, revenue) and Q1 beats highlight estimate variance for CLO equity funds; anticipate continued dispersion in Street models amid macro/tariff shifts .
Tactical positioning: Favor periods of widened asset spreads and discounted loans to build par; monitor pipeline for resets/refis and recurring cash flow trajectory into Q4 (~$0.51 guidance) .

Notes:
- All quantitative figures are as reported in CCIF’s Q3 2025 8-K and earnings materials, and prior quarter filings/transcripts.
- S&P Global consensus values are marked with an asterisk and accompanied by a disclaimer.

; Q2 2025 8-K and Transcript ; Q1 2025 8-K and Transcript ; Monthly NAV 8-Ks ; Internet sources for Q3 call availability and presentations .

Carlyle Credit Income Fund (CCIF)·Q3 2025 Earnings Summary