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Capital Southwest

Capital Southwest (CSWC) Q2 2026 Earnings

Reported Nov 3, 2025 at 4:04 PM ET · SEC Source

Q2 26 EPS

$0.57

MISS 1.93%

Est. $0.58

Q2 26 Revenue

$56.9M

BEAT +2.58%

Est. $55.5M

vs S&P Since Q2 26

+11.2%

BEATING MARKET

CSWC +20.9% vs S&P +9.7%

Market Reaction

Did CSWC Beat Earnings? Q2 2026 Results

Capital Southwest delivered a mixed fiscal second quarter, posting earnings per share of $0.57 that fell just shy of the $0.58 consensus estimate by 1.93%, while revenue of $56.95 million cleared expectations by 2.58% and surged 41.6% year over year,… Read more Capital Southwest delivered a mixed fiscal second quarter, posting earnings per share of $0.57 that fell just shy of the $0.58 consensus estimate by 1.93%, while revenue of $56.95 million cleared expectations by 2.58% and surged 41.6% year over year, underscoring the Dallas-based business development company's rapid portfolio expansion. The most material driver behind the top-line strength was a $245.50 million origination quarter across seventeen portfolio companies, pushing the total investment portfolio to approximately $1.90 billion at fair value, with 99% concentrated in first lien senior secured debt. Pre-tax net investment income climbed to $34.02 million, or $0.61 per weighted average share, lifted by higher cash interest income from a larger average investment cost basis and increased fee activity. A landmark capital markets move, the issuance of $350.00 million in inaugural index-eligible unsecured notes at 5.95%, further reinforced the company's funding profile. The board maintained its monthly dividend cadence at $0.19 per share alongside a $0.06 supplemental dividend, with NAV per share edging up to $16.62.

Key Takeaways

  • • Increase in cash interest income from larger average cost basis of investments
  • • Increase in amendment and arranger fees received during the quarter
  • • Lower operating expenses due to decreased accrued bonus compensation
  • • 99% first lien senior secured credit portfolio composition
  • • Weighted average yield on debt investments of 11.5%
  • • Internally managed structure driving operating leverage of 1.6%
  • • 96.6% floating rate credit portfolio
  • • LTM Pre-Tax NII regular dividend coverage of 104%
24/7 Wall St

CSWC YoY Financials

Q2 2026 vs Q2 2025, source: SEC Filings

24/7 Wall St

CSWC Revenue by Segment

With YoY comparisons, source: SEC Filings

Q1 26 Q4 26

“The September quarter was an incredibly active quarter on the origination front for Capital Southwest, with approximately $245 million of originations in seven new and ten existing portfolio companies. Additionally, we have continued to successfully harvest realized gains with the exit of one equity investment this quarter, increasing our undistributable taxable income balance to $1.13 per share. During the quarter, the Board of Directors again declared a regular monthly dividend of $0.1934 for each of October, November and December 2025 and a quarterly supplemental dividend of $0.06 to be paid in December 2025. On the capitalization front, we successfully raised $350 million at 5.950% in our inaugural index-eligible unsecured bond transaction. Subsequent to quarter end, we used a portion of the proceeds from this issuance to redeem both our October 2026 Notes and August 2028 Notes. Importantly, there was no make-whole premium due on either of our note redemptions. We also continued to efficiently raise equity capital during the quarter, raising approximately $40 million through our Equity ATM Program. Additionally, SBIC II received an initial leverage commitment from the SBA for $40 million.”

— Michael Sarner, Q2 2026 Earnings Press Release

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