Ares Capital Corporation (NASDAQ:ARCC) reported third-quarter 2026 earnings and investment income below analyst expectations on Tuesday, alongside a decline in net investment income compared with the corresponding period of 2025.
The business development company recorded adjusted earnings per share of $0.46, compared with the analyst consensus estimate of $0.48. Total investment income declined 2.4% year over year to $763 million, below market expectations of $776.16 million.
Ares Capital shares fell approximately 1.95% in premarket trading following the announcement.
The company also reported lower quarterly investment commitments, a reduction in net asset value per share compared with year-end 2025 and an increase in the proportion of loans on non-accrual status.
Ares Capital posted adjusted earnings of $0.46 per share for the third quarter, missing the analyst consensus forecast of $0.48 by $0.02.
Total investment income reached $763 million, compared with $782 million in the corresponding quarter of 2025.
The decrease represented approximately 2.4% year-over-year.
The reported investment income figure was also below the analyst consensus estimate of $776.16 million.
Net investment income totaled $328 million, equivalent to $0.46 per share, compared with $338 million, or $0.48 per share, in the third quarter of 2025.
The figures reflected lower investment income and net investment income compared with the prior-year period.
Kort Schnabel, Chief Executive Officer of Ares Capital, commented on the company’s third-quarter results and credit portfolio.
“We reported solid third quarter results supported by continued healthy portfolio performance, including stable credit quality and historically low levels of non-accruing loans and problem assets,” Schnabel said.
The statement reflected management’s assessment of the company’s credit portfolio during the reporting period.
Ares Capital also disclosed that loans on non-accrual status increased as a proportion of total investments at amortized cost compared with the end of 2025.
Ares Capital made approximately $2.1 billion in new investment commitments during the third quarter.
The figure compared with $3.9 billion in the corresponding period of 2025, representing a decrease of approximately 46%.
Gross investment commitments were made to 25 new portfolio companies and 28 existing portfolio companies.
The transactions reflected continued investment activity across the company’s portfolio, although the total value of new commitments was lower than in the prior-year quarter.
Ares Capital reported a weighted average yield of 10.4% on debt and other income-producing securities funded during the third quarter, measured at amortized cost.
The figure relates to securities funded during the reporting period rather than the entire investment portfolio.
The yield provides information about the income characteristics of investments funded during the quarter.
The company did not provide a directly comparable prior-year yield for newly funded securities in the supplied announcement.
As of September 30, 2026, Ares Capital’s portfolio investments had an aggregate fair value of $29.2 billion.
The figure compared with $29.5 billion at December 31, 2025.
The reduction amounted to approximately $300 million over the nine-month period.
The portfolio valuation reflects the company’s reported fair value of its investments at the end of the third quarter.
Ares Capital continued to make new investment commitments during the period, including approximately $2.1 billion in the third quarter.
Ares Capital reported net asset value per share of $19.31 at September 30, 2026.
The figure compared with $19.94 at the end of December 2025.
The decline amounted to $0.63 per share, or approximately 3.2%.
Net asset value per share provides a measure of the company’s reported net assets relative to its outstanding shares.
The reduction accompanied a decline in the reported fair value of portfolio investments over the same period.
Ares Capital reported that loans on non-accrual status represented 2.4% of total investments at amortized cost as of September 30, 2026.
The figure compared with 1.8% at December 31, 2025.
The increase represented 60 basis points over the nine-month period.
Loans are generally placed on non-accrual status when the collection of contractual interest is considered uncertain under applicable accounting policies.
The measure provides information about credit performance within the company’s investment portfolio.
Although management described overall credit quality as stable, the reported proportion of non-accrual loans was higher than at the end of 2025.
Ares Capital declared a fourth-quarter dividend of $0.48 per share.
The dividend is scheduled to be paid on December 29, 2026, to stockholders of record as of December 15, 2026.
The declared distribution compares with third-quarter net investment income of $0.46 per share.
The quarterly dividend exceeds the reported third-quarter net investment income per share by $0.02.
The company did not announce any change to its dividend policy in the supplied results.
Ares Capital reported cash and cash equivalents of $722 million as of September 30, 2026.
The company also had approximately $6.9 billion available for additional borrowing under its existing credit facilities.
Together, these amounts represented approximately $7.6 billion in cash and available borrowing capacity.
The figures provide information about the company’s liquidity resources and potential capacity to finance additional investment activity, subject to the terms of its credit arrangements.
Ares Capital shares declined approximately 1.95% in premarket trading on Tuesday following the publication of its third-quarter results.
The movement occurred after the company reported adjusted earnings and total investment income below analyst expectations.
The results also included lower new investment commitments, a reduction in net asset value per share and an increase in the proportion of non-accrual loans compared with year-end 2025.
The available information does not establish a single cause for the share price movement.
Ares Capital’s third-quarter results showed lower investment income and net investment income compared with the prior-year period, alongside reduced investment commitments.
The company’s portfolio investments totaled $29.2 billion at fair value, while net asset value per share stood at $19.31.
Non-accrual loans represented 2.4% of investments at amortized cost, compared with 1.8% at the end of 2025.
Ares Capital also declared a fourth-quarter dividend of $0.48 per share and reported approximately $7.6 billion in combined cash and available borrowing capacity.
Subsequent financial reports will provide further information about portfolio credit quality, investment activity, net asset value and the relationship between net investment income and dividend distributions.
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