Executive Summary
Gladstone Investment Corporation (GAINL) reported a steady QQ2 2025 performance characterized by solid revenue growth, very high gross margins, and robust cash flow from operations, supported by a predominantly fee- and interest-based business model in middle-market debt investments. Revenue for the quarter was $21.883 million, up 6.4% year over year, with gross profit of $15.484 million and a gross margin of approximately 70.8%. EBITDA stood at $25.51 million, while net income and earnings per share reached $15.482 million and $0.42, respectively. Operating income mirrored net income at $15.482 million, yielding an operating margin around 70.7%. The company generated strong operating cash flow of $63.163 million, yet net cash used in financing activities and other investing activities resulted in a slight net decrease in cash of $0.516 million, leaving cash at period end of $2.674 million. Total assets stood at $868.8 million, underpinned by a large long-term investment portfolio ($853.3 million) and a solid stockholders’ equity base ($458.4 million). The balance sheet shows moderate leverage (total debt $332.1 million; debt ratio ~0.38; debt-to-equity ~0.73), and a payout ratio of 56.9% with a dividend yield of about 1.66%. In the absence of an earnings-call transcript in the provided data, management commentary could not be incorporated verbatim; however, the quantitative results imply a stable yield-generating platform with exposure to private debt investments in the lower-middle market. Investors should monitor NAV trajectory, exit timing of portfolio investments, credit quality in the debt book, and liquidity dynamics given the modest cash balance and the cash flow composition.
Key Performance Indicators
QoQ: -27.88% | YoY:141.94%
QoQ: 2 546.50% | YoY:-17.56%
QoQ: 337.24% | YoY:-67.31%
QoQ: 333.33% | YoY:-70.00%
Key Insights
Revenue outlook and profitability: Revenue of $21.883 million for QQ2 2025, up 6.40% YoY and down 1.34% QoQ. Gross profit $15.484 million with a gross margin of 70.76%. EBITDA of $25.51 million and an EBITDARatio of 1.0286, reflecting strong operating leverage. Operating income and net income both reported $15.482 million, yielding an operating margin and net income margin of approximately 70.75%. Earnings per share (EPS) of $0.42 (diluted $0.42) on 36.689 million weighted average shares. YoY an...
Financial Highlights
Revenue outlook and profitability: Revenue of $21.883 million for QQ2 2025, up 6.40% YoY and down 1.34% QoQ. Gross profit $15.484 million with a gross margin of 70.76%. EBITDA of $25.51 million and an EBITDARatio of 1.0286, reflecting strong operating leverage. Operating income and net income both reported $15.482 million, yielding an operating margin and net income margin of approximately 70.75%. Earnings per share (EPS) of $0.42 (diluted $0.42) on 36.689 million weighted average shares. YoY and QoQ margin dynamics indicate sustained pricing power on investments with episodic margin variations tied to non-operating items.
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
21.88M |
6.40% |
-1.34% |
| Gross Profit |
15.48M |
141.94% |
-27.88% |
| Operating Income |
15.48M |
-17.56% |
2 546.50% |
| Net Income |
15.48M |
-67.31% |
337.24% |
| EPS |
0.42 |
-70.00% |
333.33% |
Key Financial Ratios
operatingProfitMargin
70.7%
operatingCashFlowPerShare
$1.72
freeCashFlowPerShare
$1.72
dividendPayoutRatio
56.9%
Management Commentary
No QQ2 2025 earnings-call transcript was provided in the data set. As a result, there are no management highlights or quotes to synthesize for the QQ2 2025 period. If a transcript becomes available, the highlights would be organized by themes (strategy, operations, market conditions) with direct quotes and commentary on implications.
Forward Guidance
No explicit forward-looking targets were disclosed in the QQ2 2025 data set. In a qualitative assessment, the outlook depends on the ability to maintain stable net investment income from the debt portfolio, portfolio exit timing, and credit quality. Key factors to monitor include NAV per share evolution, portfolio yield, diversification of the loan book, and liquidity buffers. Potential tailwinds include favorable credit markets and continued demand for middle-market debt; key risks include rising default rates, widening credit spreads, economic downturns, and regulatory changes affecting closed-end funds and non-traded investment vehicles.