Ares Capital (ARCC) Q4 2025 earnings summary

Executive summary

• Delivered strong financial results in 2025, with core EPS of $0.50 in Q4 and $2.01 for the year, fully covering dividends and driving ROE above 10% for both periods.

• Reported GAAP net income per share of $0.41 for Q4 2025 and $1.86 for the year, both down from 2024.

• Achieved record gross originations and new investment commitments, with portfolio at fair value reaching $29.5 billion across over 600 borrowers.

• Maintained stable credit quality, with non-accruals at cost at 1.8% and at fair value at 1.2%, both below historical averages.

• Continued to pay stable or increasing regular quarterly dividends, declaring $0.48 per share for Q1 2026.

Financial highlights

• FY 2025 GAAP net income was $1,299 million ($1.86 per share), and core EPS was $2.01, both down from FY 2024.

• Net investment income for Q4 2025 was $370 million ($0.52 per share); FY 2025 net investment income was $1,415 million ($2.02 per share).

• Net asset value (NAV) per share ended at $19.94, up slightly year-over-year.

• Portfolio at fair value reached $29.5 billion, up 10% year-over-year.

• Generated over $470 million in gross gains from equity co-investments, with average IRR above 25%.

Outlook and guidance

• Confident in maintaining current dividend level despite potential declines in short-term rates, supported by low leverage, spillover income, and strategic investments.

• Investment backlog as of January 29, 2026, stood at $2.2 billion, with 89% in first lien senior secured loans.

• Expect continued healthy credit performance and incremental growth from Senior Direct Lending Program and Ivy Hill Asset Management.