10-Q · April 28, 2026
The 10-Q emphasizes interest rate and valuation risks in Ares Capital’s portfolio while disclosing portfolio composition and sizable interest-rate sensitivity scenarios. Management reports that 71% of investments at…
Earnings analysis · 10-Q
ARCC earnings analysis
Filed July 29, 2026 · Our reading of the company's report
The latest report
The supplied filing extract does not include the income statement, balance sheet, cash-flow statement, or segment tables, so reported Q2 revenue, EPS, margins, cash flow, and period-over-period comparisons cannot be…
Read full summary
The supplied filing extract does not include the income statement, balance sheet, cash-flow statement, or segment tables, so reported Q2 revenue, EPS, margins, cash flow, and period-over-period comparisons cannot be verified from this material. The principal disclosed operating sensitivity is to interest rates: a 100-basis-point rate increase would add an estimated $94 million of annualized net income, while a 100-basis-point decline would subtract $93 million. No updated Item 1A risk factors or numeric earnings guidance were provided; the new May 26, 2026 advisory-fee derivative litigation is the most notable incremental disclosure.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
What stood out
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Net income benefits from higher base rates
ARCC's interest-rate sensitivity remains net positive: management estimates a 100-basis-point rise in base rates would increase annualized net income by $94 million, versus a $93 million reduction from a 100-basis-point decline, excluding income-based fees.
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Portfolio remains predominantly floating rate
Variable-rate assets provide substantial asset-side rate participation: 71% of investments at fair value bore variable interest or dividends at June 30, 2026, and 96% of remaining variable-rate investments excluding SDLP Certificates had rate floors.
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Full $1.0B repurchase capacity remains
The board extended the $1.0 billion stock-repurchase authorization through February 15, 2027; the entire $1.0 billion remained available at June 30, 2026.
What to watch
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Material downside if base rates fall
ARCC estimates that a 300-basis-point decline in base rates would reduce annualized net income by $227 million, excluding income-based fees. This remains meaningful because 71% of investments at fair value carry variable rates.
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New advisory-fee litigation is unresolved
A May 26, 2026 derivative action alleges excessive advisory fees under Section 36(b) and seeks damages, disgorgement, injunctive relief and possible rescission; management cannot estimate a loss range and states the outcome is uncertain.
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Illiquid portfolio valuation and credit risk
Valuation risk remains elevated because substantially all portfolio investments lack readily available market values. At June 30, 2026, 9% of investments at fair value were non-income producing and 1% were on non-accrual status.
Management's outlook
The extracted 10-Q text contains no quantitative revenue or EPS outlook. Management instead provides interest-rate sensitivity: a 100-basis-point increase is estimated to increase annualized net income by $94 million, while a 100-basis-point decrease is estimated to reduce it by $93 million, before any income-based fee impact.
Earlier filings 4
10-K · February 4, 2026
Ares Capital (ARCC) emphasizes its scale as a leading BDC and exclusive access to the Ares platform to originate and manage middle‑market direct lending investments. The 10‑K highlights $31.2 billion of total assets and…
10-Q · July 30, 2024
Ares Capital reported total investment income of $755.0 million for the quarter ended June 30, 2024, up from $634.0 million in Q2 2023. Net investment income increased to $358.0 million (Q2 2024) from $314.0 million (Q2…
10-Q · July 25, 2023
Ares Capital reported investment income of $634 million for Q2 2023, up from $479 million in Q2 2022, driving net investment income of $314 million (vs $257 million). Diluted net income per share rose to $0.59 (Q2 2022:…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.