Oaktree Specialty Lending misses earnings expectations despite revenue beat
LOS ANGELES - On Tuesday, Oaktree Specialty Lending Corporation (NASDAQ:OCSL) reported fourth-quarter earnings that fell short of analyst expectations, despite posting revenue that slightly exceeded forecasts.
The specialty finance company reported earnings per share of $0.28, missing the analyst estimate of $0.39 by $0.11, while revenue came in at $77.3 million, marginally above the consensus estimate of $76.93 million.
For the fourth fiscal quarter ended September 30, 2025, adjusted net investment income was $35.4 million ($0.40 per share), up from $32.5 million ($0.37 per share) in the previous quarter. The increase was primarily driven by higher total investment income and lower interest expense, partially offset by higher Part I incentive fees.
"Our fourth quarter results demonstrate progress in stabilizing the investment portfolio despite an uneven market environment, and we fully covered our quarterly dividend with net investment income," said Armen Panossian, Chief Executive Officer and Chief Investment Officer of Oaktree Specialty Lending. "In light of the uncertain outlook, we remain disciplined in our underwriting and selective in deploying capital."
The company’s net asset value per share was $16.64 as of September 30, 2025, down from $16.76 at the end of the previous quarter and $18.09 a year earlier. The decrease primarily reflected unrealized depreciation on certain debt and equity investments.
During the quarter, Oaktree originated $208.2 million of new investment commitments and received $177.0 million of proceeds from prepayments, exits, other paydowns and sales. The weighted average yield on new debt investments was 9.7%.
The Board of Directors declared a quarterly distribution of $0.40 per share, payable on December 31, 2025, to stockholders of record on December 15, 2025.
As of September 30, 2025, the company’s total debt to equity ratio was 1.02x, and the net debt to equity ratio was 0.97x, after adjusting for cash and cash equivalents.
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