Hercules Capital maintains robust profitability with gross margins reaching 98.1% in 2025Q4, though quarterly net income remains volatile, fluctuating between $42.5M and $120.2M due to the timing of warrant realizations.
| Metric | TTM | Dec'25 | Dec'24 | Dec'23 | Dec'22 | Dec'21 | Dec'20 | Dec'19 | Dec'18 | Dec'17 | Dec'16 | Dec'15 | Dec'14 | Dec'13 | Dec'12 | Dec'11 | Dec'10 | Dec'09 | Dec'08 | Dec'07 | Dec'06 | Dec'05 | Dec'04 |
|---|
| Sales/Revenue | 550.62M | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Revenue Growth % | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Cost of Goods Sold | 0 | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| COGS % of Revenue | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Gross Profit | 472.33M | 477.25M | 353.75M | 426.5M | 184.64M | 255.13M | 297.77M | 243.6M | 136.09M | 135.58M | 111.39M | 95.71M | 115.06M | 135.76M | 76.34M | 73.95M | 26.51M | 35.36M | 43.93M | 59.54M | 24.64M | 9.7M | 0 |
| Gross Margin % | 85.78% | 87.23% | 82.1% | 86.31% | 77.13% | 82.41% | 83.32% | 81.69% | 77.53% | 78.17% | 77.68% | 75.63% | 80.41% | 81.74% | 79.38% | 84.8% | 75.57% | 79.02% | 77% | 93.11% | 81.03% | 84.34% | - |
| Gross Profit Growth % | - | 34.91% | -17.06% | 130.99% | -27.63% | -14.32% | 22.24% | 79.01% | 0.37% | 21.71% | 16.38% | -16.82% | -15.25% | 77.84% | 3.23% | 178.96% | -25.02% | -19.51% | -26.21% | 141.62% | 154.01% | - | - |
| Operating Expenses | 115M | 112.09M | 90.78M | 89.01M | 82.56M | 80.98M | 70.51M | 70.01M | 59.59M | 56.58M | 42.69M | 52.8M | 43.87M | 36.31M | 29.58M | 27.02M | 21.53M | 21.79M | 22.94M | 17.13M | 13.26M | 7.6M | 2.04M |
| OpEx % of Revenue | - | 20.49% | 21.07% | 18.01% | 34.49% | 26.16% | 19.73% | 23.48% | 33.95% | 32.62% | 29.77% | 41.72% | 30.66% | 21.86% | 30.76% | 30.98% | 61.36% | 48.69% | 40.2% | 26.79% | 43.59% | 66.04% | - |
| Selling, General & Admin | 19.02M | 19.03M | 19.67M | 18.7M | 16.95M | 16.11M | 18.91M | 19.18M | 14.52M | 15.67M | 16.11M | 16.66M | 10.21M | 9.35M | 8.11M | 7.99M | 7.09M | 7.28M | 6.9M | 5.44M | 5.41M | 2.29M | 411.42K |
| SG&A % of Revenue | - | 3.48% | 4.57% | 3.78% | 7.08% | 5.2% | 5.29% | 6.43% | 8.27% | 9.03% | 11.23% | 13.16% | 7.13% | 5.63% | 8.43% | 9.16% | 20.2% | 16.27% | 12.09% | 8.5% | 17.79% | 19.87% | - |
| Research & Development | 0 | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| R&D % of Revenue | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Other Operating Expenses | 0 | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Operating Income | 357.32M | 365.16M | 262.97M | 337.48M | 102.08M | 174.16M | 227.26M | 173.6M | 76.5M | 79M | 68.7M | 42.92M | 71.19M | 99.45M | 46.76M | 46.94M | 4.98M | 13.57M | 21M | 42.41M | 11.38M | 2.1M | -2.04M |
| Operating Margin % | 64.9% | 66.75% | 61.03% | 68.3% | 42.64% | 56.25% | 63.59% | 58.22% | 43.58% | 45.55% | 47.91% | 33.91% | 49.75% | 59.87% | 48.62% | 53.82% | 14.2% | 30.33% | 36.8% | 66.32% | 37.43% | 18.3% | - |
| Operating Income Growth % | - | 38.86% | -22.08% | 230.6% | -41.38% | -23.37% | 30.91% | 126.94% | -3.17% | 14.98% | 60.09% | -39.71% | -28.42% | 112.68% | -0.38% | 842.11% | -63.29% | -35.36% | -50.49% | 272.53% | 440.81% | 203.09% | - |
| EBITDA | 357.66M | 365.5M | 263.43M | 337.67M | 102.28M | 174.47M | 227.68M | 173.86M | 76.69M | 79.2M | 68.91M | 43.11M | 71.45M | 99.7M | 47.05M | 47.28M | 5.38M | 13.94M | 21.3M | 42.61M | 11.45M | 2.13M | -2.03M |
| EBITDA Margin % | 64.96% | 66.81% | 61.14% | 68.34% | 42.73% | 56.36% | 63.71% | 58.3% | 43.7% | 45.67% | 48.05% | 34.07% | 49.93% | 60.02% | 48.92% | 54.22% | 15.34% | 31.15% | 37.34% | 66.64% | 37.65% | 18.51% | - |
| EBITDA Growth % | 60.59% | 38.74% | -21.99% | 230.13% | -41.37% | -23.37% | 30.95% | 126.69% | -3.16% | 14.94% | 59.84% | -39.67% | -28.33% | 111.91% | -0.5% | 778.56% | -61.39% | -34.56% | -50.01% | 272.2% | 437.76% | 204.66% | - |
| D&A (Non-Cash Add-back) | 333K | 337K | 466K | 190K | 204K | 317K | 415K | 262K | 199K | 201K | 202K | 193K | 266K | 252K | 289K | 348K | 400K | 367K | 306K | 204K | 65K | 24K | 7.53K |
| EBIT | 357.26M | 365.1M | 262.97M | 337.48M | 102.08M | 174.16M | 227.26M | 173.6M | 76.5M | 79M | 68.7M | 42.92M | 71.19M | 99.45M | 46.76M | 46.94M | 4.98M | 13.57M | 21M | 42.41M | 11.38M | 2.1M | -2.04M |
| Net Interest Income | 428.09M | 415.71M | 390.04M | 366.81M | 252.51M | 198.91M | 203.77M | 192.92M | 151.2M | 134.34M | 126.71M | 109.43M | 98.58M | 93.34M | 67.77M | 57.09M | 46.13M | 52.81M | 54.16M | 44.35M | 20.51M | 7.99M | 214.1K |
| Interest Income | 528.72M | 507.89M | 467.19M | 434.43M | 307.26M | 253.36M | 263.38M | 247.51M | 190.64M | 172.2M | 158.73M | 140.27M | 126.62M | 123.67M | 87.6M | 70.35M | 54.42M | 62.2M | 67.28M | 48.76M | 26.28M | 9.79M | 214.1K |
| Interest Expense | 100.62M | 92.18M | 77.15M | 67.62M | 54.75M | 54.45M | 59.6M | 54.6M | 39.44M | 37.86M | 32.02M | 30.83M | 28.04M | 30.33M | 19.84M | 13.25M | 8.57M | 9.39M | 13.12M | 4.4M | 5.77M | 1.8M | 0 |
| Other Income/Expense | 0 | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Pretax Income | 331.9M | 339.74M | 262.97M | 337.48M | 102.08M | 174.16M | 227.26M | 173.6M | 76.5M | 79M | 68.7M | 42.92M | 71.19M | 99.45M | 46.76M | 46.94M | 4.98M | 13.57M | 21M | 42.41M | 11.38M | 2.1M | -2.04M |
| Pretax Margin % | 60.28% | 62.1% | 61.03% | 68.3% | 42.64% | 56.25% | 63.59% | 58.22% | 43.58% | 45.55% | 47.91% | 33.91% | 49.75% | 59.87% | 48.62% | 53.82% | 14.2% | 30.33% | 36.8% | 66.32% | 37.43% | 18.3% | - |
| Income Tax | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 37.86K | 49.05M | 0 | 0 | 42.95M | 72.76M | 28.4M | 0 | -11.17M | 21.46M | -5.87M | 2K | 643.09K | 255K | 0 |
| Effective Tax Rate % | 0% | 0% | 0% | 0% | 0% | 0% | 0% | 0% | 0.05% | 62.1% | 0% | 0% | 60.33% | 73.16% | 60.75% | 0% | -224.21% | 158.15% | -27.94% | 0% | 5.65% | 12.11% | 0% |
| Net Income | 331.9M | 339.74M | 262.97M | 337.48M | 102.08M | 174.16M | 227.26M | 173.6M | 76.5M | 79M | 68.7M | 42.92M | 71.19M | 99.45M | 46.76M | 46.94M | 4.98M | 13.57M | 21M | 42.41M | 11.38M | 2.1M | -2.04M |
| Net Margin % | 60.28% | 62.1% | 61.03% | 68.3% | 42.64% | 56.25% | 63.59% | 58.22% | 43.58% | 45.55% | 47.91% | 33.91% | 49.75% | 59.87% | 48.62% | 53.82% | 14.2% | 30.33% | 36.8% | 66.32% | 37.43% | 18.3% | - |
| Net Income Growth % | 49.28% | 29.19% | -22.08% | 230.6% | -41.38% | -23.37% | 30.91% | 126.94% | -3.17% | 14.98% | 60.09% | -39.71% | -28.42% | 112.68% | -0.38% | 842.11% | -63.29% | -35.36% | -50.49% | 272.53% | 440.81% | 203.09% | - |
| Net Income (Continuing) | 331.9M | 339.74M | 262.97M | 337.48M | 102.08M | 174.16M | 227.26M | 173.6M | 76.5M | 79M | 68.7M | 42.92M | 71.19M | 99.45M | 46.76M | 46.94M | 4.98M | 13.57M | 21M | 42.41M | 11.38M | 2.1M | -2.04M |
| Discontinued Operations | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Minority Interest | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| EPS (Diluted) | 1.69 | 1.85 | 1.61 | 2.31 | 0.79 | 1.49 | 2.01 | 1.71 | 0.83 | 0.95 | 0.91 | 0.59 | 1.10 | 1.63 | 0.93 | 1.07 | 0.12 | 0.37 | 0.64 | 1.49 | 0.84 | 0.30 | -1.72 |
| EPS Growth % | 33.08% | 14.91% | -30.3% | 192.41% | -46.98% | -25.87% | 17.54% | 106.02% | -12.63% | 4.4% | 54.24% | -46.36% | -32.52% | 75.27% | -13.08% | 791.67% | -67.57% | -42.19% | -57.05% | 77.38% | 180% | 117.44% | - |
| EPS (Basic) | - | 1.90 | 1.61 | 2.32 | 0.80 | 1.50 | 2.02 | 1.71 | 0.83 | 0.95 | 0.91 | 0.60 | 1.12 | 1.67 | 0.93 | 1.08 | 0.12 | 0.38 | 0.64 | 1.50 | 0.85 | 0.30 | -1.72 |
| Diluted Shares Outstanding | 196.82M | 194.79M | 161.6M | 144.83M | 126.66M | 115.95M | 112.27M | 101.57M | 91.06M | 82.64M | 73.78M | 69.66M | 63.23M | 60.29M | 49.16M | 43.3M | 36.69M | 34.89M | 32.62M | 28.39M | 13.53M | 7.02M | 1.29M |
| Basic Shares Outstanding | 182.76M | 180.77M | 161.08M | 144.09M | 125.19M | 114.74M | 111.98M | 101.13M | 90.93M | 82.52M | 73.75M | 69.48M | 61.86M | 58.84M | 49.07M | 42.99M | 36.16M | 34.49M | 32.62M | 28.3M | 13.35M | 6.94M | 1.19M |
| Dividend Payout Ratio | - | 81.26% | 115.4% | 81.09% | 165.87% | 83.48% | 67.07% | 76.07% | 147.36% | 127.71% | 131.78% | 198.04% | 108.27% | 64.61% | 97.69% | 78.5% | 539.72% | 232.24% | 199.42% | 70.76% | 125.08% | 11.64% | - |
Cyclical Portfolio Exit Sensitivity
As evidenced by the provided financial data, Hercules Capital maintains a robust gross margin profile, peaking at 98.1% in 2025Q4, which suggests significant pricing power within its venture-debt niche despite the inherent cyclicality of warrant realizations and fee income that periodically impact quarterly performance metrics.
The company's ability to sustain high gross margins indicates a favorable spread between its floating-rate loan yields and wholesale funding costs. However, investors should monitor the volatility in net margins, which suggests that non-operating items and fair value adjustments remain critical drivers of bottom-line profitability.
Based on reported figures, HCXY demonstrates disciplined operating leverage, with SG&A expenses remaining remarkably stable between $4.5M and $5.5M over the last ten quarters, allowing the firm to scale operating income effectively during periods of higher revenue generation despite the inherent lumpy nature of BDC income.
The internal management structure appears to provide a structural advantage by avoiding the external fee drag common among peers. This efficiency allows a higher proportion of gross profit to flow through to operating income, provided that credit quality remains stable and non-accruals do not escalate.
According to the income statement history, net income exhibits significant quarterly variance, ranging from $42.5M to $120.2M, which suggests that reported EPS is heavily influenced by non-cash fair value adjustments and the timing of equity warrant realizations rather than purely recurring interest income streams.
The intermittent presence of stock-based compensation, such as the $4.2M charge in 2026Q1, warrants further investigation into the firm's long-term incentive alignment. Analysts should distinguish between core interest-driven earnings and the more volatile gains derived from the portfolio's equity-like components.
While the firm reports strong profitability, the reliance on Level 3 asset valuations for warrants and equity positions, as noted in financial disclosures, suggests that reported net income may be susceptible to subjective modeling assumptions that could mask underlying credit deterioration in the venture-backed portfolio.
Short-term fluctuations in EPS, such as the 62.1% decline observed in 2024Q2, highlight the sensitivity of the business model to the broader venture capital funding environment. Investors should remain cautious regarding the potential for future margin compression if the IPO window remains closed, delaying the realization of gains.
Quick answers to the most common questions about buying HCXY stock.
Hercules Capital Inc (HCXY) is profitable, generating $339.7M in net income for the fiscal year ending 2025 with a net profit margin of 62.1%.
Hercules Capital Inc (HCXY) reported an operating income of $365.2M, resulting in an operating profit margin of 66.7%. This margin reflects the operational efficiency of the business before interest and taxes.
Hercules Capital Inc (HCXY) generated $477.3M in gross profit for the year, representing a gross profit margin of 87.2%. This demonstrates the company's core pricing power and production efficiency.