Sixth Street Specialty Lending reported third‑quarter 2025 revenue of $109.44 million, a 0.6% increase from the $108.83 million consensus estimate and a 0.7% rise from the $108.30 million reported in Q2 2025. Net investment income per share fell to $0.46, missing the $0.5209 consensus by 11.7% and the $0.53 figure reported by some outlets. The company’s adjusted net investment income per share for the full year is now guided at the top end of the $1.97–$2.14 range, reflecting confidence in maintaining profitability despite the EPS miss.
The revenue beat was driven by a 4.5% rise in activity‑based fee income, which offset a 2.3% decline in total investment income caused by lower interest rates. The company’s portfolio performance remained strong, with a weighted‑average rating of 1.12 and only 0.6% of fair value in non‑accrual status—unchanged from the prior quarter. These factors combined to lift revenue slightly above expectations, even as the lower interest environment compressed investment income.
The EPS miss stemmed from a combination of lower net investment income and higher operating expenses. Interest income dropped as rates fell, while fee income gains were insufficient to offset the decline. Compared with Q2 2025, net investment income per share fell 8.4%, and the company’s operating margin slipped from 10.2% to 9.9%. Management attributed the shortfall to the broader direct‑lending market’s tighter spreads and the need to maintain a disciplined cost structure.
Management highlighted the leadership transition, noting that outgoing CEO Joshua Easterly will step down at year‑end and that Bo Stanley and Robert Stanley will serve as co‑CEOs. Both leaders emphasized continuity of strategy and an “investor‑first” culture. They also reiterated the company’s focus on disciplined underwriting and portfolio diversification as key to sustaining returns in a competitive environment.
Investors reacted to the EPS miss despite the revenue beat, underscoring the importance of earnings guidance over headline revenue figures. The company’s guidance for full‑year adjusted net investment income per share at the top end of the range signals confidence in its ability to navigate the current interest‑rate cycle while maintaining a disciplined approach to growth.
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