Ares Capital Stock Earnings Reports

Ares Capital reported solid Q3 2025 results: core EPS of $0.50 (stable QoQ) and GAAP EPS of $0.57, driven by strong net realized gains (Q3 net realized gains reported ~$247M) including a sizable realized gain on Potomac. NAV rose for the ninth time in 10 quarters. Origination and deployment activity accelerated — $3.9B of new commitments in Q3, $1.3B net deployment, and a $28.7B portfolio at fair value. Credit metrics remain healthy: organic LTM EBITDA growth for portfolio companies is in the low double digits, interest coverage is >2x, weighted average LTVs in the low-40% range, and nonaccruals declined (1.8% at cost; 1.0% at fair value). Funding and liquidity are strong (liquidity ~$6.2B; debt/equity net of cash ~1.02x), with recent debt refinancings and a $650M unsecured note issuance swapped to floating rate. Management reiterated confidence in sustaining the $0.48 quarterly dividend (payable Dec 30) — citing multiple levers (unused leverage capacity around 1x, opportunity in the 30% nonqualifying asset basket, potential fee income from increased activity, and ~$1.26 per share of taxable income “spillover” as a cushion). Market backdrop: transaction activity and M&A are firming, bid-ask spreads are narrowing, and ARCC notes increased pipeline/backlog (backlog ~$3B as of Oct 23). Management emphasized selective underwriting, sector specialization (notably defensive software exposure), and Ares’s scale/origination advantage as drivers of continued credit performance.