Financial Data and Key Metrics Changes - The company reported adjusted net investment income of $0.58 per share, with an annualized return on equity of 13.5%, and adjusted net income of $0.36 per share, with an annualized return on equity of 8.3% for Q1 2025 [9] - Total investments decreased to $3.4 billion from $3.5 billion in the prior quarter due to net repayment activity [29] - The weighted average yield on debt and income-producing securities decreased slightly from 12.5% to 12.3% quarter over quarter [22] Business Line Data and Key Metrics Changes - In Q1, the company provided total commitments of $154 million and total funding of $137 million across six new portfolio companies and upsizes to four existing investments [15] - The company experienced $270 million of repayments from seven full and four partial investment realizations, resulting in $133 million of net repayment activity [15] - 89% of total funding this quarter was into new investments, with 11% supporting upsizes to existing portfolio companies [19] Market Data and Key Metrics Changes - The supply and demand dynamics in the US direct lending market have been characterized by an imbalance, with the supply of capital outpacing demand [14] - The company anticipates that current uncertainty and volatility will moderate the supply and demand imbalance by slowing inflows into non-traded vehicles [15] - The weighted average spread over reference rate of new investment commitments in Q1 was 700 basis points, compared to 541 basis points for public BDC peers in Q4 [23] Company Strategy and Development Direction - The company aims to remain highly selective and disciplined in capital allocation, focusing on risk-adjusted returns [16] - The company believes that periods of heightened volatility often present the most attractive investment opportunities and is well-positioned with significant liquidity [12] - The company has a disciplined capital allocation strategy, with a focus on maintaining higher portfolio yields than sector averages [11] Management's Comments on Operating Environment and Future Outlook - Management believes the business remains well protected on the asset side with limited direct exposure to tariffs and is positioned well on the liability side [8] - The company anticipates a quarterly earnings power of approximately $0.50 per share, with potential upside if activity-based fees return to historical averages [10] - Management expressed confidence in the portfolio's credit quality, with non-accruals representing only 1.2% of the portfolio at fair value [24] Other Important Information - The board approved a base quarterly dividend of $0.46 per share and a supplemental dividend of $0.06 per share [12] - The company has approximately $1 billion of unfunded revolver capacity against $175 million of unfunded portfolio company commitments [31] - The company has entered an ATM program to expand its capital raising toolkit, with no shares issued to date [32] Q&A Session Summary Question: Impact of downward pressure on spreads due to non-traded BDC fundraising - Management noted that retail flows have likely slowed due to market volatility and emphasized their resilience through a diversified capital allocation strategy [41][44] Question: Pricing risk in a volatile environment - Management indicated that the private markets are not effectively pricing risk, but their deep fundamental investment approach allows them to navigate volatility [55][58] Question: Outlook for lane two and lane three investments - Management expects to see more opportunities as stress increases in the market, particularly in the broadly syndicated loan market [81][84] Question: Impact of banks going risk-off on the liability side - Management expressed confidence in their balance sheet management and noted that recent amendments and issuances have strengthened their position [100][102]

Financial Data and Key Metrics Changes - The company reported adjusted net investment income of $0.58 per share, with an annualized return on equity of 13.5%, and adjusted net income of $0.36 per share, with an annualized return on equity of 8.3% for Q1 2025 [8][32] - Total investments decreased to $3.4 billion from $3.5 billion in the prior quarter due to net repayment activity [32] - The weighted average yield on debt and income-producing securities decreased slightly from 12.5% to 12.3% quarter over quarter [24] Business Line Data and Key Metrics Changes - In Q1, the company provided total commitments of $154 million and total funding of $137 million across six new portfolio companies and upsizes to four existing investments [16] - The company experienced $270 million of repayments from seven full and four partial investment realizations, resulting in $133 million of net repayment activity [16] - 89% of total funding this quarter was into new investments, with 11% supporting upsizes to existing portfolio companies [20] Market Data and Key Metrics Changes - The U.S. direct lending market has seen an imbalance with the supply of capital outpacing demand, primarily due to the growth of retail investor-oriented perpetual non-traded BDC structures [14] - The company anticipates that current uncertainty and volatility will moderate the supply and demand imbalance by slowing inflows into non-traded vehicles [15] Company Strategy and Development Direction - The company emphasizes a disciplined capital allocation strategy, with portfolio yields significantly higher than the sector average, at a weighted average yield of 12.5% compared to 11.6% for peers [11] - The company is well-positioned with significant liquidity and capital to invest in what is expected to be a more interesting investment environment [12] - The company plans to maintain a conservative approach to new investments, focusing on risk-adjusted returns and avoiding participation in deals that do not align with shareholder interests [22] Management's Comments on Operating Environment and Future Outlook - Management believes the business remains well protected on the asset side with limited direct exposure to tariffs and is positioned well on the liability side [7] - The company anticipates a quarterly earnings power of approximately $0.50 per share, with potential upside if activity-based fees return to historical averages [10] - Management expressed confidence in the portfolio's credit quality, with non-accruals representing only 1.2% of the portfolio at fair value [26] Other Important Information - The board approved a base quarterly dividend of $0.46 per share and a supplemental dividend of $0.06 per share [12][13] - The company completed two capital market transactions in Q1, including a $300 million issuance of long five-year notes [32] Q&A Session Summary Question: Impact of downward pressure on spreads due to non-traded BDC fundraising - Management noted that retail flows have likely slowed due to market volatility, and the company has a resilient business model that is not solely dependent on sponsor deals [42][44] Question: Outlook for M&A activity - Management is negative on the return of M&A activity in the near term, citing overvaluation of assets and the need for time and growth [51][52] Question: Pricing risk in a volatile environment - Management indicated that the private markets are not effectively pricing risk, but the company uses a fundamental approach to assess asset value and required returns [59] Question: Deployment opportunities in lane two and lane three investments - Management is starting to see more opportunities in these areas but anticipates that more stress is needed across sectors for significant deployment [80] Question: Frequency of capital raises with the ATM program - Management confirmed that there will be no change in the frequency of capital raises, emphasizing that any issuance must be accretive to shareholders [84]

Group 1 - Sixth Street (TSLX) reported revenue of $116.35 million for Q1 2025, a year-over-year decline of 1.2%, with EPS remaining unchanged at $0.58 compared to the previous year [1] - The reported revenue fell short of the Zacks Consensus Estimate of $118.42 million, resulting in a surprise of -1.75%, while the EPS exceeded the consensus estimate of $0.56 by 3.57% [1] - The stock has returned -6.9% over the past month, underperforming the Zacks S&P 500 composite, which saw a change of -0.2% [3] Group 2 - Total investment income from non-controlled non-affiliated investments was $113.92 million, slightly below the average estimate of $114.50 million from two analysts [4] - Investment income from controlled, affiliated investments was reported as $2.43 million, matching the average estimate, while total investment income from these investments was also slightly below the average estimate of $2.44 million [4]

Sixth Street (TSLX) came out with quarterly earnings of $0.58 per share, beating the Zacks Consensus Estimate of $0.56 per share. This compares to earnings of $0.58 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 3.57%. A quarter ago, it was expected that this business development company would post earnings of $0.57 per share when it actually produced earnings of $0.61, delivering a surprise of 7.02%.Over the last four quarte ...

Financial Performance - Net Asset Value (NAV) per share decreased slightly from $17.16 at the end of Q4 2024 to $17.04 at the end of Q1 2025[11] - Net investment income per share remained stable at $0.62 for Q1 2025, consistent with Q4 2024[11] - Adjusted net investment income per share was $0.58 in Q1 2025[11] - The annualized Return on Equity (ROE) from Net Investment Income was 14.4% for Q1 2025[10, 11] - The annualized ROE from Adjusted Net Income was 8.3% for Q1 2025[10, 11] Portfolio Composition and Activity - The fair value of investments was $3.412 billion as of March 31, 2025[8, 12, 13] - The portfolio consisted of 115 companies with an average investment size of $29.7 million[10] - First-lien debt investments accounted for 93% of the portfolio[10, 12, 23, 24] - Floating rate investments represented 97% of the portfolio[10, 12] - New investment commitments totaled $154.4 million in Q1 2025[12, 19, 20, 21] - Net repayment activity was $132.9 million in Q1 2025[21] Liquidity and Capital Structure - The company had approximately $1.013 billion of undrawn capacity on its revolving credit facility[10, 41] - Available liquidity was 5.8x greater than unfunded investment commitments[41] - Leverage at quarter-end was 1.18x, within the target range of 0.90x – 1.25x[10, 11, 13]

[First Quarter 2025 Earnings Results](index=1&type=section&id=First%20Quarter%202025%20Earnings%20Results) [Financial and Operational Highlights](index=1&type=section&id=Financial%20and%20Operational%20Highlights) Sixth Street Specialty Lending reported Q1 2025 net investment income of **$0.62 per share** and **$0.39 net income per share**, with **NAV at $17.04**, while executing key financing activities | Metric | Q1 2025 Value | | :--- | :--- | | Net Investment Income (NII) per Share | $0.62 | | Adjusted NII per Share | $0.58 | | Net Income (NI) per Share | $0.39 | | Adjusted NI per Share | $0.36 | | Annualized ROE (NII) | 14.4% | | Annualized ROE (NI) | 9.2% | | NAV per Share (End of Period) | $17.04 | - The decline in NAV per share from **$17.16** (Q4 2024) to **$17.04** (Q1 2025) was mainly driven by a **$0.13 per share** reversal of unrealized gains from paydowns/sales and a **$0.06 per share** impact from widening credit spreads[4](index=4&type=chunk) | Dividend Type | Per Share Amount | Record Date | Payment Date | | :--- | :--- | :--- | :--- | | Q2 2025 Base Dividend | $0.46 | June 16, 2025 | June 30, 2025 | | Q1 2025 Supplemental Dividend | $0.06 | May 30, 2025 | June 20, 2025 | - The company issued **$300.0 million** of unsecured notes due in 2030 and entered an interest rate swap, resulting in an effective interest rate of **SOFR plus 153 basis points**[6](index=6&type=chunk) - In March, the company amended its Revolving Credit Facility, extending the maturity to March 2030 for **$1.525 billion** of commitments and reducing borrowing costs[7](index=7&type=chunk) [Portfolio and Investment Activity](index=2&type=section&id=PORTFOLIO%20AND%20INVESTMENT%20ACTIVITY) The company's Q1 2025 portfolio activity reflected reduced new investments and increased exits, resulting in a net reduction, while maintaining a conservative, predominantly floating-rate debt structure | Activity (Principal Amount, Millions) | Q1 2025 | Q4 2024 | | :--- | :--- | :--- | | New Investment Commitments | $154.4 | $479.0 | | Investments Funded | $136.8 | $323.5 | | Exits and Repayments | $269.6 | $304.7 | | Portfolio Composition (% of Fair Value) | Mar 31, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | First-Lien Debt | 92.9% | 93.9% | | Second-Lien Debt | 1.0% | 0.6% | | Mezzanine Debt | 1.5% | 1.1% | | Equity and Other | 4.6% | 4.4% | - As of March 31, 2025, **97.0%** of the company's debt investments by fair value were at floating rates, with **100%** of these subject to reference rate floors[12](index=12&type=chunk) | Weighted Average Yield | Mar 31, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | At Fair Value | 12.1% | 12.3% | | At Amortized Cost | 12.3% | 12.5% | - Portfolio credit quality remained stable, with investments on non-accrual status at **1.2%** of fair value as of March 31, 2025, a slight improvement from **1.4%** at year-end 2024[13](index=13&type=chunk) [Results of Operations](index=3&type=section&id=RESULTS%20OF%20OPERATIONS%20FOR%20THE%20THREE%20MONTHS%20ENDED%20MARCH%2031%2C%202025) For Q1 2025, total investment income slightly decreased to **$116.3 million**, while net expenses significantly reduced to **$57.0 million**, leading to an improved debt-to-equity ratio of **1.18x** - Total investment income for Q1 2025 was **$116.3 million**, down slightly from **$117.8 million** in Q1 2024, mainly due to lower interest rates, partially offset by higher activity-based fee income[16](index=16&type=chunk) - Net expenses for Q1 2025 decreased to **$57.0 million** from **$64.6 million** in Q1 2024, primarily because lower reference rates reduced the interest expense on the company's debt[17](index=17&type=chunk) | Debt and Capital Metrics (Millions) | As of Mar 31, 2025 | As of Dec 31, 2024 | | :--- | :--- | :--- | | Total Principal Debt Outstanding | $1,889.2 | - | | Undrawn Revolver Capacity | $1,012.8 | - | | Debt-to-Equity Ratio (Quarter End) | 1.18x | 1.22x | | Average Debt-to-Equity Ratio | 1.19x | 1.23x | [Liquidity and Funding Profile](index=4&type=section&id=LIQUIDITY%20AND%20FUNDING%20PROFILE) As of March 31, 2025, the company maintained a strong liquidity position of **$1.018 billion** (pre-unfunded commitments), with a funding mix of **66% unsecured** debt and a well-laddered maturity profile | Liquidity Position ($ Millions) | As of Mar 31, 2025 | | :--- | :--- | | Revolver Capacity | $1,675 | | Drawn on Revolver | ($639) | | Unrestricted Cash Balance | $5 | | Total Liquidity (Pre-Unfunded Commitments) | $1,018 | | Total Liquidity (Burdened for Unfunded Commitments) | $843 | - The company's funding mix at quarter-end was approximately **66% unsecured** and **34% secured** debt[23](index=23&type=chunk) - The company has a well-managed debt maturity profile, with the nearest maturity of **$300 million** in August 2026. The weighted average remaining maturity on debt is **~4.2 years**[23](index=23&type=chunk) [Financial Statements and Tables](index=6&type=section&id=Financial%20Statements%20and%20Tables) This section presents detailed unaudited financial statements and comparative tables, including financial highlights, consolidated balance sheets, statements of operations, and investment activity, for a comprehensive view of performance [Financial Highlights](index=6&type=section&id=Financial%20Highlights) The financial highlights table provides quarter-over-quarter and year-over-year comparisons, showing Q1 2025 Net Investment Income per share stable at **$0.62** and Net Income per share at **$0.39**, with weighted average debt yield at **12.1%** | Metric (per share) | Q1 2025 | Q4 2024 | Q1 2024 | | :--- | :--- | :--- | :--- | | Net Asset Value | $17.04 | $17.16 | $17.17 | | Net Investment Income | $0.62 | $0.62 | $0.59 | | Net Income | $0.39 | $0.55 | $0.53 | | Metric (Annualized ROE) | Q1 2025 | Q4 2024 | Q1 2024 | | :--- | :--- | :--- | :--- | | Based on Net Investment Income | 14.4% | 14.4% | 13.8% | | Based on Net Income | 9.2% | 12.8% | 12.5% | [Consolidated Balance Sheets](index=7&type=section&id=Consolidated%20Balance%20Sheets) As of March 31, 2025, the consolidated balance sheet reported total assets of **$3.499 billion** and total net assets of **$1.601 billion**, resulting in a NAV per share of **$17.04**, a slight decrease from year-end 2024 | Balance Sheet ($ thousands) | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total investments at fair value | $3,412,032 | $3,518,412 | | Total Assets | $3,498,500 | $3,582,225 | | Total Liabilities | $1,897,217 | $1,974,696 | | Total Net Assets | $1,601,283 | $1,607,529 | | Net Asset Value Per Share | $17.04 | $17.16 | [Consolidated Statements of Operations](index=8&type=section&id=Consolidated%20Statements%20of%20Operations) For Q1 2025, total investment income was **$116.3 million**, with net expenses of **$57.0 million**, leading to net investment income of **$58.0 million** and a final net income of **$37.0 million**, or **$0.39 per share** | Statement of Operations ($ thousands) | Three Months Ended Mar 31, 2025 | Three Months Ended Mar 31, 2024 | | :--- | :--- | :--- | | Total Investment Income | $116,349 | $117,783 | | Net Expenses | $57,021 | $64,571 | | Net Investment Income | $57,978 | $52,362 | | Total Net Unrealized and Realized Gains (Losses) | ($21,023) | ($4,844) | | Increase in Net Assets (Net Income) | $36,955 | $47,518 | | Earnings per common share | $0.39 | $0.53 | [Investment Activity](index=9&type=section&id=Investment%20Activity) Q1 2025 investment activity included **$154.4 million** in new commitments and **$269.6 million** in sales/repayments, with **85.1%** of new debt commitments at floating rates | Investment Activity ($ millions) | Three Months Ended Mar 31, 2025 | Three Months Ended Mar 31, 2024 | | :--- | :--- | :--- | | Total new investment commitments | $154.4 | $263.6 | | Principal amount of investments funded | $136.8 | $162.8 | | Principal amount of investments sold or repaid | $269.6 | $108.6 | - For new debt investment commitments in Q1 2025, **85.1%** were at floating rates, a decrease from **98.7%** in Q1 2024[37](index=37&type=chunk) [Supplemental Information](index=5&type=section&id=Supplemental%20Information) This section provides logistical details for the earnings call, company background, and important legal disclaimers regarding forward-looking statements and non-GAAP financial measures [Conference Call and Webcast](index=5&type=section&id=Conference%20Call%20and%20Webcast) The company will host a conference call and live webcast on **May 1, 2025**, at **8:30 a.m. Eastern Time**, to discuss its Q1 2025 financial results, with access details provided - A conference call to discuss financial results is scheduled for **8:30 a.m. Eastern Time** on **May 1, 2025**[27](index=27&type=chunk) - A live webcast and a slide presentation will be available on the Investor Resources section of the company's website[27](index=27&type=chunk) [About the Company](index=10&type=section&id=About%20the%20Company) Sixth Street Specialty Lending (TSLX) is a regulated BDC focused on direct origination of senior secured loans to U.S. middle-market companies, externally managed by Sixth Street, a global investment firm with over **$100 billion** in assets - Sixth Street Specialty Lending is a specialty finance company and regulated BDC focused on lending to U.S. middle-market companies[38](index=38&type=chunk) - The company is externally managed by Sixth Street Specialty Lending Advisers, LLC, an affiliate of Sixth Street, a global investment firm with over **$100 billion** in assets under management[38](index=38&type=chunk)[39](index=39&type=chunk) [Forward-Looking Statements and Non-GAAP Measures](index=10&type=section&id=Forward-Looking%20Statements%20and%20Non-GAAP%20Measures) The report includes forward-looking statements subject to risks and uncertainties, and utilizes non-GAAP financial measures like adjusted net investment income to reflect fundamental earnings power - The document includes forward-looking statements, and actual results may differ materially from those projected. The company does not assume an obligation to update these statements[40](index=40&type=chunk) - The company uses non-GAAP measures like **'Adjusted net investment income'** and **'Adjusted net income'** which exclude accrued capital gains incentive fees to better reflect fundamental earnings power[41](index=41&type=chunk)

PART I. FINANCIAL INFORMATION [Item 1. Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited consolidated financial statements for Sixth Street Specialty Lending, Inc., detailing financial position and operational results for Q1 2025 [Consolidated Balance Sheets](index=4&type=section&id=Consolidated%20Balance%20Sheets) The Consolidated Balance Sheet shows total assets decreased to **$3.50 billion**, with net assets at **$1.60 billion** and NAV per share at **$17.04** Consolidated Balance Sheet Highlights (in thousands) | Metric | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Investments at Fair Value | $3,412,032 | $3,518,412 | | Total Assets | $3,498,500 | $3,582,225 | | Total Liabilities | $1,897,217 | $1,974,696 | | Total Net Assets | $1,601,283 | $1,607,529 | | Net Asset Value Per Share | $17.04 | $17.16 | [Consolidated Statements of Operations](index=5&type=section&id=Consolidated%20Statements%20of%20Operations) Q1 2025 saw **$116.3 million** total investment income and **$58.0 million** net investment income, but net losses limited the increase in net assets from operations to **$37.0 million** Quarterly Operating Results (in thousands, except per share data) | Metric | Three Months Ended Mar 31, 2025 | Three Months Ended Mar 31, 2024 | | :--- | :--- | :--- | | Total Investment Income | $116,349 | $117,783 | | Net Expenses | $57,021 | $64,571 | | Net Investment Income | $57,978 | $52,362 | | Total Net Unrealized and Realized Losses | $(21,023) | $(4,844) | | Increase in Net Assets from Operations | $36,955 | $47,518 | | Earnings per common share—basic and diluted | $0.39 | $0.53 | [Consolidated Schedules of Investments](index=6&type=section&id=Consolidated%20Schedules%20of%20Investments) As of March 31, 2025, total investments at fair value were **$3.41 billion**, primarily debt, with top industry concentrations in Internet Services, Business Services, and Retail and Consumer Products Investment Portfolio Composition as of March 31, 2025 (in thousands) | Investment Type | Amortized Cost | Fair Value | | :--- | :--- | :--- | | Debt Investments | $3,292,781 | $3,253,992 | | Equity and Other Investments | $150,809 | $158,040 | | **Total Investments** | **$3,443,590** | **$3,412,032** | - As of March 31, 2025, non-qualifying assets under the 1940 Act represented **16.6%** of total assets[29](index=29&type=chunk) - The company holds one controlled, affiliated investment, IRGSE Holding Corp., with a fair value of **$66.8 million** as of March 31, 2025[30](index=30&type=chunk) [Consolidated Statements of Changes in Net Assets](index=24&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Net%20Assets) For Q1 2025, net assets decreased from **$1.608 billion** to **$1.601 billion**, as dividends declared exceeded the net increase from operations Changes in Net Assets for Q1 2025 (in thousands) | Description | Amount | | :--- | :--- | | Balance at December 31, 2024 | $1,607,529 | | Net increase from operations | $36,955 | | Stock issued via dividend reinvestment plan | $6,440 | | Dividends declared | $(49,641) | | **Balance at March 31, 2025** | **$1,601,283** | [Consolidated Statements of Cash Flows](index=25&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) For Q1 2025, net cash provided by operating activities was **$149.9 million**, while financing activities used **$130.0 million**, leading to a **$19.9 million** net increase in cash Cash Flow Summary for Q1 2025 vs Q1 2024 (in thousands) | Cash Flow Activity | Three Months Ended Mar 31, 2025 | Three Months Ended Mar 31, 2024 | | :--- | :--- | :--- | | Net Cash Provided by (Used in) Operating Activities | $149,919 | $(65,538) | | Net Cash Provided by (Used in) Financing Activities | $(129,978) | $76,232 | | Net Increase (Decrease) in Cash | $19,941 | $10,694 | | Cash, End of Period | $47,269 | $35,890 | [Notes to Consolidated Financial Statements](index=26&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes detail accounting policies, fair value measurement, adviser agreements, investment portfolio specifics, debt structure, and financial highlights, including the company's **BDC** and **RIC** status - The company is managed by Sixth Street Specialty Lending Advisers, LLC and has elected to be regulated as a **Business Development Company (BDC)** and a **Regulated Investment Company (RIC)**[51](index=51&type=chunk) - For the three months ended March 31, 2025, the Adviser waived Management Fees of **$0.4 million** pursuant to the Leverage Waiver[110](index=110&type=chunk) - As of March 31, 2025, the company's asset coverage ratio was **185.1%**, above the **150%** regulatory requirement[167](index=167&type=chunk) - The company declared total dividends of **$0.53 per share** for the first quarter of 2025, consisting of a **$0.46 base dividend** and a **$0.07 supplemental dividend**[190](index=190&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=58&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's performance, financial condition, and market outlook, emphasizing direct origination of senior secured loans to U.S. middle-market companies and strong liquidity - The company focuses on lending to middle-market companies with annual EBITDA between **$10 million** and **$250 million**[200](index=200&type=chunk) - As of March 31, 2025, **97.0%** of debt investments bore floating interest rates, with **100.0%** of these having interest rate floors, providing a hedge against inflation[209](index=209&type=chunk) - Since inception through March 31, 2025, exited investments have generated an average realized gross internal rate of return (IRR) of **17.0%**[264](index=264&type=chunk) [Portfolio and Investment Activity](index=67&type=section&id=Portfolio%20and%20Investment%20Activity) As of March 31, 2025, the investment portfolio was valued at **$3.41 billion**, primarily first-lien debt, with Q1 2025 new fundings at **$136.8 million** and exits at **$269.6 million** Investment Activity (in millions) | Metric | Three Months Ended Mar 31, 2025 | Three Months Ended Mar 31, 2024 | | :--- | :--- | :--- | | Total new investment commitments | $154.4 | $263.6 | | Principal amount of investments funded | $136.8 | $162.8 | | Principal amount of investments sold or repaid | $269.6 | $108.6 | Portfolio Composition by Fair Value | Investment Type | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | First-lien debt | 92.9% | 93.9% | | Second-lien debt | 1.0% | 0.6% | | Mezzanine debt | 1.5% | 1.1% | | Equity and other | 4.6% | 4.4% | Non-Accrual Investments | Metric | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | As % of Fair Value | 1.2% | 1.4% | | As % of Amortized Cost | 3.7% | 3.6% | [Results of Operations](index=70&type=section&id=Results%20of%20Operations) For Q1 2025, total investment income was **$116.3 million**, net expenses decreased to **$57.0 million**, yielding **$58.0 million** net investment income, but net losses reduced the increase in net assets from operations to **$37.0 million** Investment Income Breakdown (in millions) | Income Source | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Interest from investments | $106.6 | $104.6 | | Paid-in-kind interest income | $5.4 | $8.1 | | Dividend income | $0.9 | $0.8 | | Other income | $3.4 | $4.3 | | **Total Investment Income** | **$116.3** | **$117.8** | Expense Breakdown (in millions) | Expense Source | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Interest | $33.0 | $39.0 | | Management fees (net) | $12.7 | $12.2 | | Incentive fees | $7.8 | $10.1 | | **Net Expenses** | **$57.0** | **$64.6** | - Net realized gains were **$0.8 million** in Q1 2025, while net change in unrealized losses was **$21.8 million**[259](index=259&type=chunk) The unrealized losses were driven by widening credit spreads, negative credit-related adjustments, and foreign currency fluctuations[261](index=261&type=chunk)[263](index=263&type=chunk) [Financial Condition, Liquidity and Capital Resources](index=77&type=section&id=Financial%20Condition%2C%20Liquidity%20and%20Capital%20Resources) The company maintains strong liquidity with **$47.3 million** cash and **$1.0 billion** available on its Revolving Credit Facility, supported by a **185.1%** asset coverage ratio Debt Obligations as of March 31, 2025 (in millions) | Debt Instrument | Outstanding Principal | Carrying Value | | :--- | :--- | :--- | | Revolving Credit Facility | $639.2 | $621.3 | | 2026 Notes | $300.0 | $284.3 | | 2028 Notes | $300.0 | $298.0 | | 2029 Notes | $350.0 | $343.2 | | 2030 Notes | $300.0 | $298.0 | | **Total Debt** | **$1,889.2** | **$1,844.8** | - As of March 31, 2025, the company had total unfunded commitments to portfolio companies of **$322.6 million**[317](index=317&type=chunk) - The company's asset coverage ratio was **185.1%** as of March 31, 2025, providing significant cushion over the required **150%** level[273](index=273&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=70&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company faces **valuation**, **interest rate**, and **currency risks**, managed through a portfolio of primarily floating-rate assets and currency hedging strategies - The company's primary market risks are **valuation risk** for its illiquid private investments, **interest rate risk**, and **currency risk**[331](index=331&type=chunk) Annualized Impact of Hypothetical Interest Rate Changes on Net Interest Income (in millions) | Basis Point Change | Impact on Net Interest Income | | :--- | :--- | | Up 300 basis points | $36.9 | | Up 200 basis points | $24.6 | | Up 100 basis points | $12.3 | | Down 25 basis points | $(3.1) | | Down 50 basis points | $(6.2) | - Currency risk is primarily managed by borrowing in the same foreign currency as the investment to create a **natural hedge**[339](index=339&type=chunk) [Item 4. Controls and Procedures](index=71&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded the company's disclosure controls and procedures were **effective** as of March 31, 2025, with no material changes to internal control over financial reporting - The CEO and CFO concluded that the company's disclosure controls and procedures are **effective**[340](index=340&type=chunk) - No material changes to internal control over financial reporting occurred during the most recently completed fiscal quarter[341](index=341&type=chunk) PART II. OTHER INFORMATION [Item 1. Legal Proceedings](index=72&type=section&id=Item%201.%20Legal%20Proceedings) The company is not currently subject to any **material legal proceedings** or aware of any being threatened against it - The company is not currently a party to any **material legal proceedings**[342](index=342&type=chunk) [Item 1A. Risk Factors](index=72&type=section&id=Item%201A.%20Risk%20Factors) This section directs readers to the comprehensive risk factors detailed in the Annual Report on Form 10-K for the fiscal year ended December 31, 2024 - The report directs investors to review the risk factors detailed in the Annual Report on Form 10-K for the fiscal year ended December 31, 2024[343](index=343&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=72&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) There were no unregistered sales of equity securities during the period - None[344](index=344&type=chunk) [Item 5. Other Information](index=72&type=section&id=Item%205.%20Other%20Information) No directors or officers adopted, modified, or terminated any Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during Q1 2025 - No directors or officers adopted, modified, or terminated any Rule 10b5-1 trading plans during the first quarter of 2025[347](index=347&type=chunk) [Item 6. Exhibits](index=73&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including amendments to credit agreements, indentures, and CEO/CFO certifications - Key exhibits filed include the **Sixteenth Amendment to the Senior Secured Revolving Credit Agreement** and **CEO/CFO certifications** pursuant to the Sarbanes-Oxley Act[348](index=348&type=chunk) Signatures The report was duly signed on **April 30, 2025**, by **Joshua Easterly**, Chief Executive Officer, and **Ian Simmonds**, Chief Financial Officer - The report was duly signed on **April 30, 2025**, by **Joshua Easterly, Chief Executive Officer**, and **Ian Simmonds, Chief Financial Officer**[352](index=352&type=chunk)

Core Insights - Mr. Mavroudis is a professional portfolio manager with a focus on risk management and in-depth financial market analysis [1] - He has successfully navigated major crises, including the COVID-19 pandemic and the PSI [1] - Mr. Mavroudis is the CEO of FAST FINANCE Investment Services, a registered Greek company [1] Professional Background - Mr. Mavroudis holds multiple degrees: MSc in Financial and Banking Management, LLM in Law, and BSc in Economics, graduating as valedictorian [1] - He is a certified portfolio manager and analyst for financial instruments, as well as a specialist in derivatives and securities market-making [1] - He is also a licensed Class A accountant-tax consultant and a member of the Economic Chamber of Greece [1] Contributions to the Industry - Mr. Mavroudis writes daily articles for reputable financial media and appears as a guest commentator on television and online programs [1] - He teaches in educational seminars and has published three books on investments [1] - By writing on Seeking Alpha, he aims to engage with a community of investors and market enthusiasts, fostering mutual growth and knowledge sharing [1]

Company Overview - Sixth Street (TSLX) shares increased by 6.4% to close at $20.38, following a notable trading volume, contrasting with a 13.2% loss over the past four weeks [1] - The company is expected to report quarterly earnings of $0.56 per share, reflecting a year-over-year decline of 3.5%, with revenues projected at $118.57 million, a slight increase of 0.7% from the previous year [2] Earnings Estimates and Market Sentiment - The consensus EPS estimate for Sixth Street has remained unchanged over the last 30 days, indicating that stock price movements may not sustain without trends in earnings estimate revisions [3] - The stock currently holds a Zacks Rank of 3 (Hold), suggesting a neutral outlook [3] Industry Comparison - Crescent Capital BDC (CCAP), a peer in the same industry, saw its shares rise by 7.9% to $15.32, but has experienced a -16.4% return over the past month [3] - CCAP's consensus EPS estimate is $0.52, representing a year-over-year decline of 17.5%, and it currently holds a Zacks Rank of 4 (Sell) [4]

Core Insights - The article emphasizes the importance of innovation and disruption in the financial sector, particularly focusing on high-tech and early growth companies [1] Group 1: Investment Focus - The company is keen on identifying growth buyouts and value stocks as potential investment opportunities [1] - There is a strong emphasis on monitoring the pace of high-tech advancements and their impact on investment strategies [1] Group 2: Research and Analysis - The article aims to provide readers with comprehensive research and insights into current events affecting the industry [1] - It highlights the significance of understanding market dynamics to uncover potential investment risks and opportunities [1]