Gladstone Capital Corporation (GLAD): Business Model Canvas [Dec-2025 Updated]

You're looking past the ticker symbol to see how Gladstone Capital Corporation (GLAD) actually makes money, and honestly, it's a classic Business Development Company (BDC) play, just executed with precision. As an externally managed entity, its engine runs on originating and underwriting debt-mostly senior secured loans-for the lower middle market, managing a portfolio worth $859 million at fair value as of September 30, 2025, while delivering investors that attractive 12.7% weighted average yield last fiscal year. Let's break down the nine core blocks of their strategy, from their key partnership with Gladstone Management Corporation to how they turn interest income of $89.1 million into those monthly payouts you see.

Gladstone Capital Corporation (GLAD) - Canvas Business Model: Key Partnerships

You're looking at the core relationships that let Gladstone Capital Corporation operate and grow its portfolio, which had total investments at fair value of $751,260 thousand as of June 30, 2025. These partnerships are critical for sourcing deals, managing operations, and raising capital.

Advisory and Administrative Structure

Gladstone Capital Corporation relies on affiliated entities for its day-to-day management and investment direction. Gladstone Management Corporation (GMC) serves as the external adviser, managing the investment portfolio and directing security purchases and sales under an investment advisory and management agreement.

This agreement was renewed in early 2025, retaining the same terms, including fee structures, following a change of control at GMC. David Gladstone serves as the Chief Executive Officer for both Gladstone Capital Corporation and GMC.

Gladstone Administration, LLC provides essential administrative services. While specific 2025 expense figures for Gladstone Administration, LLC aren't explicitly detailed here, the overall expense structure is important; total expenses, net of credits, for the quarter ended June 30, 2025, were $10,363 thousand.

Financing and Capital Deployment Partners

Securing and managing debt capacity is a major partnership function. Commercial banks are key here, as evidenced by the recent amendment to the credit facility.

On June 23, 2025, Gladstone Capital Corporation, through its subsidiary Gladstone Business Loan, LLC, entered into Amendment No. 9 with KeyBank National Association and other lenders. This action increased the total available borrowing commitments under the Credit Facility to $320.0 million. The revolving period end date for this facility was extended to October 30, 2027, with a final maturity set for October 2029.

The company also engages with Broker/Dealers and Registered Investment Advisors for capital raising efforts. For instance, in 2025, Gladstone Capital Corporation had an Underwriting Agreement with Oppenheimer & Co. Inc. related to its 5.875% Convertible Notes Due 2030. In 2024, Equity Distribution Agreements were in place with Jefferies LLC and Huntington Securities, Inc.

Co-Investment Relationships

Mid-sized private equity sponsors are partners in deal origination and co-investment, which is permitted subject to SEC orders under Sections 17(d) and 57(i) of the 1940 Act. This structure allows Gladstone Capital Corporation to participate in larger or more complex transactions alongside other capital providers.

For a related entity, Gladstone Investment Corporation, co-investment expenses as of March 31, 2025, were $0.1 million.

Here's a quick look at the key financial metrics tied to these operational relationships as of mid-to-late 2025:

Partnership/Metric Category	Specific Partner/Facility	Latest Reported Amount/Date	Unit/Context
Credit Facility Commitment	Commercial Banks (led by KeyBank)	$320.0 million (as of June 2025)	Total available borrowing commitments
Investment Advisory	Gladstone Management Corporation (GMC)	Agreement terms retained (as of Jan 2025)	Investment Advisory and Management Agreement
Capital Raising	Oppenheimer & Co. Inc.	Underwriting Agreement (2025)	Convertible Notes issuance
Administrative Expenses	Gladstone Administration, LLC (Implied)	$10,363 thousand (Q3 2025)	Total expenses, net of credits, for the quarter
Co-Investment Activity (Related Entity)	Mid-sized PE Sponsors (General)	$0.1 million (as of March 31, 2025)	Co-investment expenses for Gladstone Investment Corp.

The weighted average yield on interest-bearing investments, which reflects the performance of the assets sourced through these partnerships, was 12.8% for the quarter ended June 30, 2025. For the fiscal year ended September 30, 2025, total investment income was $89.1 million.

The firm continues to see activity with its capital raising partners; for example, in November 2025, Gladstone Capital Corporation announced its intent to redeem its 5.125% Notes due 2026 and 7.75% Notes due 2028.

• GMC manages the investment portfolio under the advisory agreement.
• KeyBank National Association is a primary lender in the credit facility.
• Jefferies LLC and Huntington Securities, Inc. were involved in equity distribution agreements in 2024.
• The firm's portfolio mix as of June 30, 2025, showed secured first lien assets were over 70% of debt investments, at cost.

Finance: draft 13-week cash view by Friday.

Gladstone Capital Corporation (GLAD) - Canvas Business Model: Key Activities

You're looking at the core actions Gladstone Capital Corporation (GLAD) takes to run its business as a Business Development Company (BDC) as of late 2025. These aren't just things they do; they are the specific, measurable activities that drive their financial results.

Originate and Underwrite Debt and Equity Investments in Lower Middle Market

Gladstone Capital Corporation's primary activity is putting capital to work in lower middle market U.S. companies. This involves originating and underwriting both debt and equity investments. For the fiscal year ended September 30, 2025, the investment activity was substantial:

• Invested $310.7 million in 15 new portfolio companies during FY 2025.
• Deployed an additional $86.1 million into existing portfolio companies in FY 2025.

Looking just at the fourth quarter of fiscal year 2025 (Q4 2025), the deployment pace was strong:

Q4 2025 Investment Component	Amount (Millions)
Total Invested in Q4 2025	$126.6 million
Invested in New Portfolio Companies (Q4)	$106.7 million
Invested in Existing Portfolio Companies (Q4)	$19.9 million

This activity resulted in total investments at fair value reaching $859.1 million as of September 30, 2025, spread across 55 companies in 22 states. That's a lot of underwriting work.

Manage a Diverse Portfolio, with 70%+ in Secured First Lien Debt

Managing the portfolio means structuring investments to prioritize downside protection, which is evident in the asset mix as of September 30, 2025. The focus is heavily weighted toward the most senior part of the capital structure.

Here is the breakdown of total investments at fair value:

• Secured first lien debt: 72.4% at fair value, equating to $622.4 million.
• Secured second lien debt: 17.5% at fair value, equating to $150.5 million.
• Equity (common and preferred): 10.0% at fair value, equating to $85.9 million.

Honestly, keeping secured first lien assets above 70% of debt investments, at cost, is a consistent management goal they hit again in FY 2025. It definitely anchors the portfolio.

Raise Capital via Public Markets and Debt Offerings, like the $149.5 million Convertible Note Issue

To fund originations, Gladstone Capital Corporation actively accesses capital markets. A key recent event was the September 2025 debt issuance.

The company closed an offering of 5.875% convertible notes due 2030 for gross proceeds of $149.5 million on September 12, 2025. They expected net proceeds of approximately $142.3 million from this, which they planned to use to repay a portion of their outstanding credit facility debt and for general corporate purposes, including redeeming outstanding 2028 notes. This is how they keep the investment engine fueled.

Provide Managerial Assistance to Portfolio Companies as a BDC

As an externally managed Business Development Company, a core activity is providing managerial assistance to the lower middle market companies they invest in. While this is an operational function rather than a direct revenue line, it's crucial to their value proposition for borrowers. The structure of their fees, which includes net base management fees and net incentive fees, reflects the ongoing oversight and support provided to these portfolio companies.

Execute Net Originations, such as the $103.1 million in Q4 2025

The execution of new investment activity, often measured as net originations (new investments minus repayments/sales), is tracked quarterly. While the prompt mentioned a specific figure, the reported total investment for Q4 2025 was $126.6 million. The activity also included significant repayments and sales:

• Total repayments and net proceeds for the period ending March 31, 2025, were $84,069 thousand (or $84.1 million).
• Subsequent to September 30, 2025, two debt investments totaling $28.1 million and $17.8 million paid off at par.

Finance: draft 13-week cash view by Friday.

Gladstone Capital Corporation (GLAD) - Canvas Business Model: Key Resources

You're looking at the core assets Gladstone Capital Corporation (GLAD) relies on to execute its business development company (BDC) strategy. These aren't just line items; they are the engines of income generation and capital deployment. Honestly, for a BDC, the quality and size of the investment pool, plus the team managing it, are everything.

The primary tangible resource is the deployed capital base, which is actively managed to generate current income and potential capital appreciation. This portfolio is the direct result of their financing activities in the lower middle market.

Resource Metric	Value (as of 9/30/2025)	Context
Total Investments at Fair Value	$859.124 million	This is the portfolio value you asked for, based on the Fiscal Year Ended September 30, 2025 report.
Portfolio Fair Value as % of Cost	98.0%	Indicates a slight net unrealized depreciation on the total investment cost as of 9/30/2025.
Investments in Q4 FY2025	$106.7 million	Capital deployed in five new portfolio companies during the fourth fiscal quarter.

The intellectual capital comes from the external adviser, Gladstone Management Corporation (GMC). This team is responsible for sourcing, underwriting, and managing the debt and equity investments. GMC is a registered investment adviser headquartered in McClean, Virginia, and it advises several other Gladstone-named funds, suggesting deep institutional knowledge in this space.

Funding these investments requires a mix of debt and equity capital structures. Gladstone Capital Corporation uses a revolving credit facility and various notes payable to maintain liquidity and leverage for deployment.

• Revolving Credit Facility: The total commitment was increased to $320.0 million, with the revolving period end date extended to October 2027. As of March 31, 2025, the facility had an accordion feature allowing an increase up to $350.0 million.
• Notes Payable: The company has outstanding debt instruments, including 3.75% Notes due 2027 and 5.875% Convertible Notes due 2030. In September 2025, Gladstone Capital Corporation announced a registered public offering of $110 million aggregate principal amount of unsecured convertible notes due 2030, with an option for an additional $16.5 million. The net proceeds from this planned offering were intended to repay a portion of the outstanding indebtedness under the revolving credit facility.

For equity capital, Gladstone Capital Corporation relies on its public market presence. This access to public equity allows for capital raises to support portfolio growth and debt repayment. It's a key differentiator for a BDC.

The company's equity structure is capitalized through:

• Publicly traded common stock on the Nasdaq under the ticker GLAD. As of December 5, 2025, the market capitalization stood at $473.111M.
• Preferred stock, which is also a component of their capital base.

The Net Asset Value (NAV) per common share was reported at $21.34 subsequent to September 30, 2025, reflecting NII growth and gains. That's the foundation you work with.

Gladstone Capital Corporation (GLAD) - Canvas Business Model: Value Propositions

You're looking at what Gladstone Capital Corporation (GLAD) offers to its partners-the core value it brings to the lower middle market. It's about providing flexible, substantial capital when a company needs to make a big move, whether that's a change in ownership or a major debt overhaul.

The financing Gladstone Capital Corporation provides is designed to be comprehensive, covering the full spectrum of a company's capital needs. This isn't just one-size-fits-all lending; it's a tailored approach that supports various stages and transaction types. For instance, management noted that FY25 closed with over $100 million of net originations, showing their deployment activity was strong.

Here is a breakdown of the specific financing instruments and the types of corporate actions Gladstone Capital Corporation is ready to support:

Financing Product	Transaction Type Supported
Senior Term Loans	Change of Control
Second Lien Loans	Growth Capital
Unitranche Loans	Debt Refinancing
Minority Equity	Acquisition Financing
Revolving Loans	Recapitalization

A key part of the value proposition is the yield generated from this debt focus. For the fiscal year ended September 30, 2025, Gladstone Capital Corporation reported a weighted average yield on its interest-bearing investment portfolio of 12.7%. That's a solid return profile, even though it represented a decrease from the 13.9% seen in the prior fiscal year. This focus on high-yield debt is central to their model.

Beyond the immediate financing, Gladstone Capital Corporation offers two other critical value points for investors and partners:

• Long-term capital appreciation potential via equity co-investments.
• Monthly cash distributions to common stockholders.

For you as a potential common stockholder, the commitment to regular payouts is clear. As of late 2025, the board declared monthly cash distributions of $0.15 per share of common stock for October, November, and December 2025. This translates to a total quarterly distribution of $0.45 per share from those three months. The management team has definitely worked to maintain these distributions, though they noted in October 2025 that a decline in short-term floating rates meant the current yields no longer supported the previous, higher dividend rate, leading to an adjustment. Still, the monthly cadence remains a core feature of the offering.

To give you a sense of scale for the deals they target, Gladstone Capital Corporation typically aims to invest between $8 million and $40 million in each portfolio company. They look for companies with revenues between $20 million and $150 million and EBITDA of $3 million to $25 million-plus. That's the sweet spot for their specialized debt and equity solutions.

Gladstone Capital Corporation (GLAD) - Canvas Business Model: Customer Relationships

You're looking at how Gladstone Capital Corporation (GLAD) manages its connections with the companies it invests in and the public market that funds it. It's a mix of deep operational involvement and formal financial reporting.

Dedicated relationship management with portfolio company executives

Gladstone Capital Corporation (GLAD) focuses on providing financing solutions to lower middle market businesses nationwide, working directly with management teams. This relationship is hands-on, especially given the nature of lending to this market segment. The company's management emphasizes a commitment to delivering attractive returns to shareholders, which is directly tied to portfolio performance.

The portfolio credit tone is actively managed; as of the fourth quarter ended September 30, 2025, non-earning debt remained modest, involving only three investments, representing about 1.7% of debt Fair Value (FV). Furthermore, the investment structure itself reflects a commitment to security, with over 70% of its debt investments secured by first lien assets.

Active board participation and managerial assistance to portfolio companies

The relationship extends beyond capital provision into active oversight and support. This is evidenced by the company's investment pace and focus. For the quarter ended September 30, 2025, Gladstone Capital Corporation (GLAD) invested $106.7 million in five new portfolio companies and an additional $19.9 million in existing portfolio companies. Over the full fiscal year 2025, the company sourced and closed 15 new investments representing $397 million of originations. This level of activity suggests continuous engagement with portfolio company needs and performance monitoring.

The management team highlighted specific portfolio successes, noting that one company, WBXL, saw 18 straight months of sales/profit growth and became EBITDA positive. This kind of detailed performance tracking is key to the relationship.

Here are some key portfolio and performance metrics as of late 2025:

Metric	Value (Q4 Ended 9/30/2025)	Value (FY Ended 9/30/2025)
Total Investments, at Fair Value	$859,124 thousand	N/A
Invested in Q4	$126,633 thousand	N/A
Net Originations (Q4)	In excess of $100 million	N/A
Weighted Average Yield on Interest-Bearing Investments	12.5%	12.7% (FY 2025 vs 13.9% in FY 2024)
Net Realized Loss Recognized	$6.3 million	$55.6 million (Net realized gain for FY)

Transactional relationship with private equity sponsors for deal flow

A core part of Gladstone Capital Corporation (GLAD)'s origination strategy involves its transactional relationship with external capital partners. Gladstone Capital partners with management teams, entrepreneurs, and private equity sponsors to provide financing solutions nationwide. This reliance on sponsors is a primary source of deal flow. The company noted that its Q4 2025 activity included five new sponsor-backed investments. Furthermore, management has indicated that they increased their floating-rate bank borrowings to capitalize on the projected decline in short-term rates, suggesting a tactical approach to capital structure that supports deal execution.

The ability to participate in larger financing opportunities, which might otherwise be unavailable to a fund of its size, is a benefit derived from these co-investment and sponsor relationships. This is supported by the fact that the company issued $149.5 million in 5.875% Convertible Notes due 2030, which, alongside other capital structure moves, supported their investment pace.

Regular communication with public investors via SEC filings and earnings calls

For public investors, communication is structured and periodic, centered around mandatory disclosures and scheduled events. Gladstone Capital Corporation (GLAD) is listed on Nasdaq. As of December 4, 2025, the stock was trading at $21.16. The company communicates results through SEC filings, such as the Form 10-K for the fiscal year ended September 30, 2025, and quarterly earnings releases furnished via Form 8-K.

The relationship involves setting clear expectations for distributions, even when adjustments are necessary. For instance, the common stock distribution was adjusted by 9.1% to $0.15 per share per month effective with the October 31, 2025 payment, citing declines in short-term floating rates. This transparency is crucial for the investor base.

Here's a look at the key financial metrics shared with public investors:

• Net investment income per common share for the quarter ended September 30, 2025, was $0.52.
• Net investment income per common share for the full fiscal year ended September 30, 2025, was $2.02.
• The common stock distribution for each of October, November, and December 2025 was declared at $0.15 per share.
• The Series A Preferred Stock distribution for the same period was $0.130208 per share monthly.
• Over the past five years, the company generated a $6.71 per-share increase in net asset value and a 16.8% return on equity.

The company explicitly warns investors that it does not contact individuals via direct phone calls, WhatsApp groups, or social media channels to offer investment opportunities, directing all inquiries to official communication channels like email at capital@gladstonecompanies.com or phone at (703) 287-5893.

Finance: draft Q1 2026 investor outlook based on Q4 2025 yield compression analysis by Friday.

Gladstone Capital Corporation (GLAD) - Canvas Business Model: Channels

You're looking at how Gladstone Capital Corporation (GLAD) gets its capital and reaches its investment targets as of late 2025. It's a mix of direct relationship building and public market access.

Direct origination team sourcing deals from intermediaries and sponsors

The direct origination team is the engine for deal flow, focusing on the lower middle market. This channel relies heavily on established relationships with sponsors and intermediaries to source proprietary investment opportunities. For the fiscal year ended September 30, 2025, Gladstone Capital Corporation was able to source and close 15 new investments representing $397 million of originations. In the fourth quarter of fiscal year 2025 alone, the team funded $126.6 million in investments, with five new sponsor-backed investments closed during that period. This resulted in approximately $103.1 million in net originations for Q4 2025. The portfolio's first lien debt stood at 72% of fair value of new investments, and total debt holdings were at 90%.

• Q4 2025 Funded Investments: $126.6 million
• FY 2025 Total Originations: $397 million
• Q3 2025 New Investments: $58.6 million in two companies
• Total Debt Holdings as % of Fair Value (Q4 2025): 90%

Public equity markets (Nasdaq) for common and preferred stock investors

Gladstone Capital Corporation accesses public markets via the Nasdaq Stock Market for its common stock. As of December 5, 2025, the company's market capitalization stood at $478.97 million. The common stock traded at $21.20 on that date, which is within the 52-week range of $18.763 to $30.43. The forward annualized dividend is set at $1.80 per share, yielding approximately 8.51% based on recent pricing. The common distribution for October, November, and December 2025 was declared at $0.15 per share monthly.

Metric	Value (as of late 2025)	Context/Date
Market Capitalization	$478.97 million	December 5, 2025
Common Stock Price (Last Close)	$21.20	December 5, 2025
52-Week High/Low	$30.43 / $18.763	Recent Trading Data
Forward Annualized Dividend	$1.80	Forward Estimate
Monthly Common Distribution (Q4 2025)	$0.15 per share	October - December 2025

Investment banking and broker-dealer networks for debt and preferred stock issuance

The company uses investment banking networks to raise capital through debt and preferred stock. In September 2025, Gladstone Capital Corporation priced a registered public offering of 5.875% Convertible Notes due 2030. The initial size was $110.0 million, which was upsized to $130.0 million aggregate principal amount, priced at 98.5% of the principal amount. This followed the redemption of outstanding debt, specifically the $150.0 million 5.125% Notes due 2026 and the $57.0 million 7.75% Notes due 2028 in October 2025. The 6.25% Series A Cumulative Redeemable Preferred Stock, which has a liquidation preference of $25.00 per share, is available through participating Broker/Dealers and Registered Investment Advisors, with Gladstone Securities, LLC acting as dealer manager.

• Convertible Notes Issued (Sep 2025): $130.0 million
• Notes Interest Rate: 5.875% due 2030
• 2026 Notes Redeemed: $150.0 million
• 2028 Notes Redeemed: $57.0 million
• Series A Preferred Stock Coupon: 6.25%

Investor Relations website and SEC filings for shareholder information

Shareholder communication is channeled through the official Investor Relations website and mandatory SEC filings. The results for the Fourth Quarter and Fiscal Year Ended September 30, 2025, were released via an Earnings Release on November 17, 2025. The latest Annual Filing, the 10-K for FY 2025, was also made available around that time. The Investor Relations contact phone number is (703) 287-5893. The company explicitly warns investors not to engage via direct phone calls, WhatsApp groups, or social media channels for investment offers. The shelf registration statement for debt/equity offerings was initially filed with the SEC on January 17, 2024 (File No. 333-275934).

• FY 2025 Earnings Release Date: November 17, 2025
• Investor Relations Phone: (703) 287-5893
• SEC Shelf Registration Effective Date: January 17, 2024
• Total Cash (MRQ as of Q3 FY25): $32.37M

Finance: draft next quarter's distribution coverage analysis by end of month.

Gladstone Capital Corporation (GLAD) - Canvas Business Model: Customer Segments

You're looking at the core audience Gladstone Capital Corporation (GLAD) serves, which splits into two distinct groups: the private companies they finance and the public investors who fund those activities.

For its portfolio companies, Gladstone Capital Corporation (GLAD) focuses squarely on the lower middle market companies in the U.S., specifically targeting those that are established and have positive operating cash flow at the time of investment. This focus is on providing debt and equity investments to these smaller, often privately held entities. The geographic concentration is the United States.

The financial sweet spot for these target companies is quite specific, which helps Gladstone Capital Corporation (GLAD) manage risk by focusing on a defined size of enterprise. Here's the quick math on the typical target profile:

Metric	Target Range (Lower Bound)	Target Range (Upper Bound)
Annual EBITDA	$3 million	$25 million+
Annual Sales	$20 million	$150 million
Investment Size (Debt)	$8 million	$40 million

Gladstone Capital Corporation (GLAD) is industry agnostic, meaning they look across many different types of businesses, but certain sectors appear frequently in their investment thesis and portfolio activity. They are definitely looking for stability and defensibility within these sectors.

• Light and specialty manufacturing
• Business services
• Niche industrial products and services
• Aerospace and defense
• Energy services
• Healthcare and education services

To give you a concrete idea of the businesses they are working with, recent portfolio activity shows investments in areas like workforce outsourcing for recycling facilities (Leadpoint Business Services, LLC) and precision manufacturing businesses, plus they have exposure to defense-related composites and armor solutions (Iten Defense). These are the types of companies that make up the debt and equity investments.

The second major customer segment is the capital provider: public and institutional investors seeking high-yield, monthly dividend income. Gladstone Capital Corporation (GLAD) is structured to pass income through to its shareholders, making the consistent, frequent payout a key part of its value proposition to this group. You can see this commitment in their payment schedule.

Here are the latest figures related to that dividend commitment as of late 2025:

• Payout Frequency: Monthly
• Next Ex-Dividend Date: Dec 22, 2025
• Next Dividend Amount Per Share: $0.15 USD
• Forward Annual Dividend: $1.80 per share
• Reported Dividend Yield (Varies by source): 9.29% to 11.25%

For the investor segment, the reliability of the monthly payment is the primary draw, supported by the current yield figures. Finance: draft 13-week cash view by Friday.

Gladstone Capital Corporation (GLAD) - Canvas Business Model: Cost Structure

You're looking at the hard costs that Gladstone Capital Corporation (GLAD) incurs to keep the lights on and manage its investment portfolio. For a Business Development Company (BDC) like GLAD, the cost structure is heavily weighted toward financing costs and fees paid to its external manager, Gladstone Management Corporation.

Here's a look at the key components based on the fiscal year ended September 30, 2025, data, which gives you the clearest picture of the annual run rate for these expenses. Remember, these are reported in thousands of U.S. Dollars ($K) unless otherwise specified.

The total expenses, net of credits received from the Adviser, for the fiscal year ended September 30, 2025, were $60,777K. This figure is what ultimately impacts net investment income before considering realized and unrealized gains/losses.

The cost structure is dominated by debt servicing and management fees. For instance, the interest expense on the credit facility and notes payable alone for the year was $19,986K. That's a big chunk of the total operating cost.

The debt profile saw significant shifts late in the year. As of September 30, 2025, the weighted average balance outstanding on the Credit Facility for the fourth quarter was $74.3 million, a substantial increase from the $6.6 million average balance in the prior quarter, which drove up interest expense in Q4 2025 by about $1.4 million quarter-over-quarter. To fund growth and manage this, Gladstone Capital Corporation issued 5.875% Convertible Notes due 2030 in September 2025, raising $149.5 million. This new debt was used, in part, to call and repay $150 million of 5.125% notes due January 2026 and $57 million of 7.75% notes due in 2028.

The fees paid to the external manager, Gladstone Management Corporation, are structured around asset levels and investment performance. The base management fee is generally based on total assets, while the incentive fee has income-based and capital gains-based components. While the exact gross fee amounts for the full year are embedded within the net expense figures after credits, we can see the impact of fee adjustments:

• The net base management fee saw a $2.4 million decrease for the full fiscal year ended September 30, 2025, compared to the prior year, driven by higher investment banking fee credits.
• The net incentive fee saw a $3.1 million decrease for the full fiscal year ended September 30, 2025, compared to the prior year.

Here is a breakdown of the key expense categories for the fiscal year ended September 30, 2025:

Cost Component (in thousands)	Fiscal Year Ended September 30, 2025
Interest expense on line of credit and notes payable	$19,986
Expenses, before credits from Adviser	$60,777
Total expenses, net of credits	$60,777 (Note: This figure appears to be the total net expense figure from one source, not the sum of the line items before credits)
Other general and administrative expenses	$2,148
Professional fees	$1,054

General and administrative expenses, which cover the day-to-day running of the BDC outside of investment management and financing, are relatively small compared to the interest expense. You can see the specific components below:

• Other general and administrative expenses for FY 2025: $2,148K.
• Professional fees for FY 2025: $1,054K.

Costs associated with raising capital, such as underwriting and legal fees, are often captured within the Professional fees line item or are expensed directly upon issuance. The issuance of $149.5 million in new convertible notes in Q4 2025 represents a significant capital-raising event that would have incurred these types of costs, though the specific underwriting expense is not isolated in the readily available summary data.

Gladstone Capital Corporation (GLAD) - Canvas Business Model: Revenue Streams

The revenue streams for Gladstone Capital Corporation (GLAD) are fundamentally rooted in its investment portfolio, primarily generating income from debt holdings and, secondarily, from equity positions and investment exits. This structure is typical for a business development company (BDC).

Interest income from secured debt investments serves as the primary engine for Gladstone Capital Corporation's revenue generation. This income is derived from the interest payments on the debt securities held within its portfolio, which are predominantly senior secured loans to lower middle market businesses in the United States. For the fiscal year ended September 30, 2025, the weighted average yield on the interest-bearing investment portfolio was $\text{12.5\%}$. This compares to $\text{13.9\%}$ for the prior fiscal year.

The overall performance of investment income for the most recently completed fiscal year is a key metric. Total investment income was $\text{\$89.1 million}$ for the fiscal year ended September 30, 2025. This figure represented a decrease from the $\text{\$96.6 million}$ reported for the fiscal year ended September 30, 2024.

You can see the breakdown of the key components contributing to the total investment income below. Note that the full-year breakdown of interest income versus other income components is derived from the year-over-year change figures provided in the earnings release.

Revenue Component	FY Ended September 30, 2025 Amount (in millions USD)	Context/Notes
Total Investment Income	$\text{\$89.1}$	Primary measure of revenue from investments for the full fiscal year.
Interest Income	Calculated: $\text{\$89.1M}$ minus $\text{\$1.5M}$ (Other Income decrease) minus $\text{X}$ (Other Income actual)	Decreased by $\text{\$6.0 million}$ compared to the prior fiscal year.
Other Income (Prepayment Fees & Dividends)	Calculated: $\text{\$X}$	Decreased by $\text{\$1.5 million}$ year-over-year for the fiscal year.
Quarterly Interest Income (Q4 FY2025)	$\text{\$23.8}$	Interest income for the quarter ended September 30, 2025.

Other income provides supplementary revenue, which can be variable based on portfolio activity. This category includes items like prepayment fees received when portfolio companies pay off debt early, and dividend income from equity investments Gladstone Capital Corporation holds. For the quarter ended September 30, 2025, dividend and success fee income rose $\text{\$0.7 million}$ compared to the previous quarter. However, for the full fiscal year ended September 30, 2025, total investment income was impacted by a $\text{\$1.5 million}$ decrease in other income compared to the prior year.

The final significant component of revenue realization comes from capital events. Realized capital gains from the successful exit of equity investments contribute to the net increase in assets from operations, though these are less predictable than recurring interest income. For the fiscal year ended September 30, 2025, Gladstone Capital Corporation reported net realized gains of $\text{\$55.6 million}$. This contrasts with the fourth quarter of fiscal year 2025, which saw a net realized loss of $\text{\$6.3 million}$.

You should track these revenue sources carefully, as the mix shifts based on market conditions and deal flow. Here's a quick look at the net impact on operations for the full year:

• Net investment income for the year ended September 30, 2025, was $\text{\$45.2 million}$.
• Net realized gains for the year ended September 30, 2025, totaled $\text{\$55.6 million}$.
• The weighted average yield on interest-bearing investments for the year was $\text{12.5\%}$.

Finance: draft 13-week cash view by Friday.