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SURO CAPITAL CORP. (SSSS)·Q2 2025 Earnings Summary

Executive Summary

  • Net asset value rose to $9.18 per share as of June 30, 2025, up 38% quarter-over-quarter from $6.66 and up from $6.94 year-over-year, driven by realized gains and significant unrealized appreciation tied to AI infrastructure holdings .
  • Net increase in net assets from operations was $62.3 million ($2.63 per basic share), reflecting $21.2 million realized gains (CoreWeave, ServiceTitan) and $44.8 million unrealized appreciation; net investment loss remained $(3.7) million .
  • Liquidity stood at $52.4 million (cash and unrestricted public securities) at quarter-end; Board declared a $0.25 cash dividend (paid July 31) and management signaled intent to announce additional distributions in 2H25 .
  • Portfolio catalysts: CoreWeave IPO/post-IPO strength and monetization ($25.3 million proceeds, $15.3 million realized gain), OpenAI’s landmark financing and potential secondary sale, and Colombier/GrabAGun merger, with AI infrastructure representing ~33% of fair value .

What Went Well and What Went Wrong

What Went Well

  • CoreWeave monetization: Sold 222,240 directly held CoreWeave shares for $25.3 million net proceeds, realizing $15.3 million gain; continuing exposure via CW Opportunity 2 LP (discount due to unregistered shares) .
  • AI portfolio validation: NAV per share up >35% QoQ; management attributed strength to AI capex tailwinds and OpenAI’s $40B raise at $300B valuation; potential OpenAI secondary at $500B was noted in call commentary .
  • Dividend initiation and outlook: Declared $0.25 cash dividend, with intent to announce additional distributions later in the year, supported by monetization of public positions .
    • Quote: “Based on current portfolio activity and subject to Board approval, we intend to announce additional distributions throughout the remainder of the year.” — Mark Klein .

What Went Wrong

  • Investment income softness: Investment income fell to $0.17 million vs $1.03 million in Q2 2024 and $0.50 million in Q1 2025, reflecting mix and timing of income streams .
  • Ongoing net investment loss: Net investment loss remained $(3.7) million (($(0.16)) per share), consistent with prior year’s Q2, amid elevated operating expense ratios typical for structure .
  • Estimate miss on “Revenue”: S&P Global consensus “Revenue” estimate for Q2 2025 was ~$0.50 million vs actual $0.17 million; while EPS was less negative than expected, the investment income line missed the single-estimate consensus* [GetEstimates].

Financial Results

Core P&L Drivers (BDC-style)

Metric ($USD)Q2 2024Q1 2025Q2 2025
Investment Income$1,027,353 $499,094 $167,304
Net Investment Loss$(3,655,625) $(3,661,769) $(3,722,160)
Net Realized Gain/(Loss) on Investments$(29,612) $(17,951) $21,212,611
Net Change in Unrealized Appreciation/(Depreciation)$(6,965,946) $2,888,878 $44,837,619
Net Increase/(Decrease) in Net Assets from Operations$(10,651,183) $(806,715) $62,328,070
Net Increase/(Decrease) in Net Assets per Share (Basic)$(0.45) $(0.03) $2.63

NAV and Liquidity

MetricQ4 2024Q1 2025Q2 2025
NAV per Share ($)$6.68 $6.66 $9.18
Net Assets ($)$157,572,086 $156,804,155 $219,409,595
Liquid Assets ($)$23,600,000 N/A$52,400,000
Shares Outstanding (End of Period)23,601,566 23,551,859 23,888,107

Top Five Investments at June 30, 2025

Portfolio CompanyCost Basis ($mm)Fair Value ($mm)% of Total Portfolio
CW Opportunity 2 LP (CoreWeave SPV)$15.2 $40.9 16.8%
ARK Type One Deep Ventures (OpenAI SPV)$17.7 $27.8 11.4%
Whoop, Inc.$11.0 $23.7 9.7%
Colombier Sponsor II LLC$1.6 $20.3 8.3%
Learneo, Inc.$15.0 $15.4 6.3%
Total$60.5 $128.0 52.5%

KPI Highlights

KPIQ2 2024Q1 2025Q2 2025
Ratio of Net Operating Expenses to Avg Net Assets10.75% 10.79% 9.73%
Ratio of Net Investment Loss to Avg Net Assets(8.39)% (9.49)% (9.31)%
Portfolio Turnover5.72% 5.28% 2.36%
Portfolio Fair Value ($mm)N/A$213.6 $243.8
AI Infrastructure Allocation (% of FV)N/AN/A~33%

Consensus vs Actual (S&P Global)

MetricQ2 2025 EstimateQ2 2025 Actual
Primary EPS Consensus Mean ($)-0.17*-0.1318*
Revenue Consensus Mean ($)499,000*167,304

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

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
NAV per Share (Prelim.)Q2 2025$9.00–$9.50 prelim (7/8/2025) Reported $9.18 (8/6/2025) Met within range
Cash DividendQ3 2025 timingNone prior$0.25 cash dividend declared 7/3, paid 7/31 Initiated
Distribution Outlook2H 2025None priorIntends additional distributions in Q3/Q4 (subject to Board) New commentary
Convertible Notes Conversion RatePost-dividend$7.75 (129.0323 shares per $1,000) Adjusted to $7.53 (132.753 shares per $1,000) effective 7/21 Adjusted due to dividend

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4 2024 and Q1 2025)Current Period (Q2 2025)Trend
AI infrastructure thesis2024: $54.5mm invested across CoreWeave/OpenAI/VAST; CoreWeave IPO filing CoreWeave IPO/post-IPO surge; partial monetization; AI infra ~33% of portfolio FV Strengthening conviction, realized liquidity
IPO market reopeningAnticipated registration timing for ServiceTitan/CoreWeave shares CoreWeave IPO success; market appetite reinforced (Figma IPO strength) Reopening affirmed
OpenAI private market dynamics$40B round at $300B post-money (Q1) Reports of oversubscribed tranche and potential $500B secondary; ARR traction commentary Valuation momentum
Dividend/distribution policyNo dividend in FY24; buyback program ongoing $0.25 cash dividend; intent for additional distributions Return of capital introduced
SPAC sponsor strategyPrior exits (Oklo, PublicSquare); Colombier pipeline Colombier II completed merger with GrabAGun Continuing execution

Management Commentary

  • “The second quarter of 2025 marked SuRo Capital’s strongest performance since our inception, highlighted by a greater than 35% increase in NAV per share… CoreWeave’s successful IPO and strong post-IPO trading were key drivers… OpenAI’s historic $40 billion capital raise… further validated the demand for transformative AI platforms.” — Mark Klein .
  • “During the quarter, we sold approximately 40% of our initial CoreWeave investment generating $25,300,000 in net proceeds and a $15,300,000 in realized gains… We intend to announce additional distributions throughout the remainder of the year.” — Mark Klein .
  • “We ended the second quarter with a net asset value of approximately $219,400,000 or $9.18 per share… increase… attributable to $1.88 per share increase driven by net unrealized appreciation and $0.89 per share increase due to net realized gain… offset by $(0.16) per share net investment loss and $(0.10) stock-based compensation.” — Allison Green .

Q&A Highlights

  • Dividend sizing and cadence: Citi queried why $0.25 versus realized gains of $21 million ($0.85/share) and potential sizing for Q3/Q4. Management targets at least one, likely two additional distributions, contingent on monetizations of freely tradable public positions (CoreWeave, Colombier II/GrabAGun) and Board approvals .
  • Tone: Confident on AI ecosystem positioning and continued liquidity events; distribution framework remains opportunistic rather than fixed .

Estimates Context

  • Q2 2025 “EPS” (Primary EPS) came in less negative than consensus (-$0.1318 actual vs -$0.17 estimate), while “Revenue” (investment income) missed ($0.167 million actual vs ~$0.499 million estimate)*. Importantly, SSSS’s quarter was driven by realized gains and unrealized appreciation, which are not captured in the “Revenue” line and thus consensus comparisons may not reflect value creation in an investment company context .
  • Forward quarters have sparse coverage: limited estimates for EPS and revenue; consensus target price appears stable across near-term periods (single-source coverage)*.

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

Key Takeaways for Investors

  • The quarter’s value creation was substantial: $62.3 million net increase in net assets from operations ($2.63/share), lifting NAV to $9.18 and demonstrating the leverage to AI infrastructure and private-market exposure .
  • Liquidity is robust ($52.4 million), with added flexibility from partial CoreWeave monetization and ServiceTitan exit to support distributions and selective deployment .
  • Expect distributions: Management aims for at least one and likely two additional distributions in 2H25, tied to monetization milestones; watch CoreWeave/SPV lockup dynamics and Colombier/GrabAGun progress for triggers .
  • AI portfolio optionality: Continued validation from OpenAI financing and market enthusiasm for design software (Figma IPO; Canva potential secondary) positions SSSS to benefit from further private and public market events .
  • Monitor expense/income profile: Investment income is lumpy and operating expense ratios remain high; performance will primarily hinge on realization events and fair value changes rather than recurring income .
  • Estimate frameworks may under-represent value creation for BDC-like vehicles; traders should anchor on NAV trajectory, realized gains pipeline, and distribution announcements rather than GAAP “revenue” .
  • Near-term catalysts: Additional dividend declarations, CoreWeave SPV share registration/lockup expirations, potential OpenAI secondary, and further IPO market reopening could drive stock reaction .