Horizon Technology Finance

Horizon Technology Finance (HRZN) Q1 2025 Earnings

Reported Apr 29, 2025 at 4:23 PM ET · SEC Source

Q1 25 EPS

$0.27

MISS 17.13%

Est. $0.33

Q1 25 Revenue

$24.5M

MISS 8.09%

Est. $26.7M

vs S&P Since Q1 25

-72.4%

TRAILING MARKET

HRZN -33.0% vs S&P +39.4%

Market Reaction

Did HRZN Beat Earnings? Q1 2025 Results

Horizon Technology Finance delivered a disappointing first quarter of 2025, missing on both the top and bottom lines as rising credit stress and portfolio yield compression weighed on results. The company posted earnings of $0.27 per share, falling s… Read more Horizon Technology Finance delivered a disappointing first quarter of 2025, missing on both the top and bottom lines as rising credit stress and portfolio yield compression weighed on results. The company posted earnings of $0.27 per share, falling short of the $0.33 consensus estimate by 17.13%, while total investment income of $24.52 million trailed expectations by 8.09%, despite representing a 31.0% increase year-over-year. The most material blow came from a sharp surge in net unrealized depreciation of $32.16 million, which drove net assets per share down to $7.57 from $8.43 at year-end 2024, with the stock touching a 52-week low of $7.55 around the time of the report. Credit quality also showed signs of strain, with high-risk loans rising from four to seven, carrying a fair value of just $15.50 million against a cost of $66.70 million. On a more constructive note, Horizon funded $100.30 million in new loans during the quarter and enters Q2 with a $236 million committed backlog, while maintaining its $0.33 quarterly distribution, supported by $1.00 per share in spillover income.

Key Takeaways

  • Lower interest income on investments from the debt portfolio drove decline in total investment income
  • Debt portfolio yield of 15.0% annualized, down from 15.6% year-over-year
  • Funded nine loans totaling $100.3 million in Q1 2025
  • Net unrealized depreciation on investments of $32.2 million ($0.80 per share) significantly impacted NAV
  • Interest expense increased by $0.5 million year-over-year
  • Five liquidity events from portfolio companies during the quarter
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HRZN YoY Financials

Q1 2025 vs Q1 2024, source: SEC Filings

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HRZN Revenue by Segment

Business unit performance breakdown

“We grew our portfolio of debt investments for the third straight quarter, while further expanding our committed backlog, which provides us with high-quality opportunities to continue growing both our venture debt portfolio and our NII in the quarters ahead.”

— Robert D. Pomeroy, Jr., Q1 2025 Earnings Press Release