Executive Summary

Q3 2025 delivered stable core results: NII of $0.97 per share, DNII of $1.03 per share, total investment income of $139.8M, and a record NAV of $32.78 per share; annualized ROE was 17.0% .
Results were essentially in line with consensus: EPS $0.97 vs $0.980* and revenue $139.831M vs $139.872M*; minimal variances reflect non-recurring income normalization and modest interest income headwinds (values retrieved from S&P Global).
Management raised forward dividends to $0.26 per month for Q1 2026 and declared a $0.30 supplemental dividend for December 2025; CFO guided to at least $1.05 DNII before taxes per share in Q4 2025, with upside from portfolio activity .
Portfolio valuation gains were robust (+$63.0M unrealized), offset by $19.1M realized losses from restructurings/exits; liquidity remained strong at $1.561B with conservative leverage (regulatory debt-to-equity 0.62x), underpinning capital flexibility .

What Went Well and What Went Wrong

What Went Well

Record NAV per share (13th consecutive increase) driven by significant net fair value appreciation in LMM equity investments; CEO: “another record for net asset value per share primarily driven by a significant net fair value increase of our existing lower middle market investment portfolio” .
Dividend income strength YoY (+$8.0M), supported by continued favorable performance of LMM portfolio companies and external asset management contribution .
Capital structure strengthened by issuance of $350M 5.40% August 2028 notes; liquidity of $1.561B with ample unused revolver capacity provides dry powder for deployment .

What Went Wrong

Interest income declined YoY by $7.3M due to lower benchmark rates/spreads and higher non‑accruals, partly offset by higher average debt investments .
Realized losses of $19.1M tied to two private loan restructurings and exits of two LMM investments, partially offset by gains on other exits .
Operating efficiency ratio ticked up YoY to 1.4% (annualized) vs 1.3% in Q3 2024, reflecting higher cash compensation and share-based comp .

Financial Results

Metric	Q3 2024	Q1 2025	Q2 2025	Q3 2025
Total investment income ($USD Millions)	$136.824	$137.046	$143.973	$139.831
Net investment income (NII) ($USD Millions)	$84.380	$89.810	$88.183	$86.538
NII per share ($USD)	$0.96	$1.01	$0.99	$0.97
Distributable NII (DNII) ($USD Millions)	$89.757	$94.832	$94.344	$92.705
DNII per share ($USD)	$1.03	$1.07	$1.06	$1.03
Net increase in net assets from operations ($USD Millions)	$124.007	$116.082	$122.534	$123.671
Per share ($USD)	$1.42	$1.31	$1.37	$1.38
Operating Expenses to Assets Ratio (annualized) (%)	1.3%	1.2%	1.4%	1.4%

Segment/Portfolio KPIs:

KPI	Q3 2024	Q1 2025	Q2 2025	Q3 2025
LMM portfolio – Number of companies	—	86	88	88
LMM portfolio – Fair value ($USD Billions)	—	$2.611	$2.669	$2.782
Private loan – Number of companies	—	90	87	86
Private loan – Fair value ($USD Billions)	—	$1.942	$1.920	$1.886
Weighted‑avg annual effective yield: LMM / Private loan (%)	—	12.7 / 11.4	12.8 / 11.4	12.7 / 11.1
Non‑accrual investments (% of portfolio at FV / Cost)	—	1.7% / 4.5%	2.1% / 5.0%	1.2% / 3.6%
Total portfolio FV as % of cost	—	118%	117%	118%

Balance sheet and capital:

Metric	Q1 2025	Q2 2025	Q3 2025
Liquidity ($USD Billions)	$1.302	$1.351	$1.561
Cash & cash equivalents ($USD Millions)	$109.2	$87.0	$30.6
Unused credit facility capacity ($USD Billions)	$1.193	$1.264	$1.530
Regulatory debt-to-equity leverage (ex-SBIC)	—	—	0.62x
Regulatory asset coverage ratio	—	—	2.61x

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
DNII before taxes per share	Q4 2025	—	At least $1.05 per share; potential upside from portfolio activity	Initiated
Regular monthly dividend per share	Q1 2026	$0.255 per month (Q4 2025 baseline)	$0.26 per month (Jan/Feb/Mar 2026)	Raised
Supplemental dividend per share	Dec 2025	—	$0.30 (payable 12/29/2025)	Declared
Regular monthly dividend per share	Q4 2025	$0.255 per month (Oct/Nov/Dec 2025)	$0.255 per month (affirmed)	Maintained

Earnings Call Themes & Trends

Topic	Previous Mentions (Q1 2025)	Previous Mentions (Q2 2025)	Current Period (Q3 2025)	Trend
AI/technology initiatives	Not discussed	Not discussed	Presidents Meeting featured AI use cases; majority of LMM companies engaged in AI adoption	Emerging positive
Private loan pipeline/activity	Net increase in cost basis (+$25.6M)	Net decrease in cost basis (‑$34.9M)	Pipeline now “above average”; expect stronger originations into Q4/Q1; repayments lighter	Improving
LMM portfolio performance	Strong unrealized appreciation; record NAV	Continued positive results; dividend income strength	Continued strong dividend contributions and significant fair value appreciation; new platforms added	Sustained strength
Macro/tariffs/uncertainty	Conservative leverage, strong liquidity	Market uncertainty acknowledged; conservative operation	Operating more conservative than long-term leverage targets due to uncertainty	Cautious stance
Asset management/AUM	MSC Income Fund listed; contribution $7.8M to NII	Contribution $8.7M to NII	Contribution $8.8M to NII; AUM $1.6B; leverage capacity catalyst at MSC Income Fund in Jan 2026	Stable/growing
Credit quality/non‑accruals	1.7% FV / 4.5% cost non‑accrual	2.1% FV / 5.0% cost non‑accrual	Improved to 1.2% FV / 3.6% cost; management sees portfolio “doing well”	Improving

Management Commentary

CEO: “another quarter of strong operating results… and another record for net asset value per share primarily driven by a significant net fair value increase of our existing lower middle market investment portfolio” .
CEO: “seventeenth consecutive quarterly supplemental dividend… maintain very strong liquidity and a conservative leverage profile… confident that our diversified lower middle market and private loan investment strategies… will allow us to continue to deliver superior results” .
CFO: “DNII before taxes per share for the quarter of $1.07… Looking forward, we expect fourth quarter… DNII before taxes of at least $1.05 per share, with potential upside driven by portfolio investment activities” .
CIO: On AI and LMM support: “the vast majority of our portfolio companies are engaged in utilizing AI… actively seeking additional ways to use AI tools” .

Q&A Highlights

Private loan pipeline sustainability: Activity picked up materially post last call; both volume and deal sizes improved; expected to continue into 2026 .
Credit quality: Improvement viewed broadly across portfolios; no specific driver, diversified portfolio continues to perform well .
Compensation/headcount: Adding investment professionals in LMM and private credit to support growth across balance sheet and asset management; expense uptick reflects incentive accruals/base comp/headcount .
Asset management AUM targets: No specific 2026 guidance; expect growth via increased regulatory leverage at MSC Income Fund and ramp of MS Private Loan Fund II .
AI impact: Benefits viewed as more forward-looking; not yet reflected materially in valuations .

Estimates Context

Main Street’s Q3 2025 results were essentially in line with Wall Street consensus: EPS $0.97 vs $0.980* and revenue $139.831M vs $139.872M*; upcoming quarters show stable expectations for EPS (~$0.986* in Q4, ~~$0.982* in Q1 2026) and revenue (~~$140.750M* in Q4, ~$140.492M* in Q1 2026). Target price consensus stands at ~$60.67* (values retrieved from S&P Global).

Metric	Q3 2025 Actual	Q3 2025 Estimate*	Q4 2025 Estimate*	Q1 2026 Estimate*
EPS ($USD)	$0.97	0.9795*	0.9860*	0.9817*
Revenue ($USD Millions)	139.831	139.872*	140.750*	140.492*
Target Price ($USD)	—	60.67*	60.67*	60.67*

Values retrieved from S&P Global.

Key Takeaways for Investors

Core earnings resilient with in-line revenue/EPS and strong DNII; Q4 guide “at least $1.05” DNII before taxes per share signals continued dividend coverage and potential upside from realizations .
Record NAV and sizable unrealized gains in LMM validate equity co‑investment model; watch for announced LMM realizations and private loan equity exits (> $35M gains referenced) as near-term catalysts .
Dividend policy remains a key attraction: supplemental $0.30 in December and regular monthly increased to $0.26 for Q1 2026; continued potential for future supplemental dividends tied to DNII and realized gains .
Liquidity and leverage are supportive of deployment: $1.561B liquidity and 0.62x regulatory leverage provide ample capacity amid improving origination pipelines .
Risks: realized loss variability from restructurings/exits and lower benchmark rates/spreads pressuring interest income; monitor non‑accrual trends (currently low) and macro-driven deal flow .
Asset management business (AUM ~$1.6B) continues to contribute to NII; potential 2026 catalyst from MSC Income Fund’s increased regulatory leverage capacity .
Trading implication: near-term sentiment supported by dividend actions and Q4 DNII guide; medium-term thesis hinges on sustained LMM realizations, private loan pipeline conversion, and disciplined capital allocation under conservative leverage .

Additional Press Releases (Q3 2025 context)

Private loan portfolio activity: $117.3M of new/increased commitments and $113.3M funded in Q3, spanning HVAC/plumbing, datacenter services, power equipment, specialty glass, chemicals, and energy metering; portfolio cost ~$1.9B across 86 companies .
Dividends: First quarter 2026 monthly dividends increased to $0.26 per share; supplemental $0.30 dividend payable in December 2025 .

Note: All company figures and qualitative statements are sourced from the Q3 2025 press release, Form 8‑K exhibits, and earnings call transcript, with explicit citations. Consensus estimate figures are from S&P Global (as noted).

Main Street Capital CORP (MAIN)·Q3 2025 Earnings Summary