Prospect Capital Posts 32% Income Drop
Prospect Capital (NASDAQ:PSEC), a business development company investing in U.S. middle-market loans and related assets, released its Q4 FY2025 earnings on August 27, 2025. The release highlighted a sharp decline in GAAP earnings and net asset value amid continued portfolio repositioning. The company reported net investment income per share of $0.17 (GAAP), down from $0.25 a year ago, and a net loss per share of $(0.50), a significant swing compared to $(0.02) in the same quarter last year. Total investment income (GAAP) dropped to $167 million, compared to $212 million in the prior year.
These results missed past levels and underscored management’s ongoing efforts to focus on less risky assets. The quarter saw substantial realized and unrealized losses, major distribution reductions, and declining asset values, marking a challenging period for the company.
Prospect Capital is a business development company (BDC) that provides senior, first lien, and second lien loans to U.S. middle-market companies. The company also invests in equity and equity-linked securities for potential Capital gains. Its primary revenue comes from recurring interest payments and, to a lesser extent, from Capital gains on its equity and other investments.
Source Fool.com
