Core lending revenue is recovering—NII of $17.1M in 2026Q2 rose 18.4% YoY—yet non-interest income of -$5.9M pushed total revenue to $18.9M and produced a $25.0M operating loss, confirming that warrant mark-to-market volatility (which swung from a $17.3M gain in 2025Q3 to losses in four of ten quarters) still dominates reported profitability.
Horizon Technology Finance Corporation (HRZN) annual income statement — 17-year revenue, gross profit & net income history
| 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 |
|---|
| Net Interest Income | 19.19M | 57.66M | 64.71M | 81.16M | 58.16M | 42.38M | 32.52M | 28.76M | 22.42M | -5.17M | -5.88M | -5.76M | -8.71M | -8.12M | -4.28M | -2.68M | 10.74M | -4.24M |
| NII Growth % | -272.91% | -10.9% | -20.27% | 39.53% | 37.25% | 30.31% | 13.09% | 28.24% | 533.97% | 12.1% | -2.1% | 33.88% | -7.18% | -89.68% | -59.75% | -124.96% | 353.04% | - |
| Net Interest Margin % | 210.99% | 7.11% | 7.87% | 10.12% | 7.59% | 8.25% | 7.99% | 8.36% | 8.41% | -2.21% | -2.46% | -2.05% | -3.87% | -3.08% | -1.79% | -1.36% | 4.97% | -3.4% |
| Interest Income | 64.26M | 90.46M | 96.97M | 110.13M | 77.37M | 54.41M | 42.19M | 37.09M | 28.79M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 14.99M | 0 |
| Interest Expense | 31.81M | 32.8M | 32.26M | 28.97M | 19.2M | 12.03M | 9.67M | 8.33M | 6.36M | 5.17M | 5.88M | 5.76M | 8.71M | 8.12M | 4.28M | 2.68M | 4.25M | 4.24M |
| Loan Loss Provision | -15.11M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 953K | 1.84M | 2.15M | -8.71M | -8.12M | -19.42M | 1.51M | -4.25M | -2.04M |
| Non-Interest Income | 27.93M | -50.44M | -63.02M | -91.03M | -31.52M | -9.11M | -22.19M | -7.46M | -7.52M | 12.4M | -1.76M | 14.96M | 20.84M | 7.23M | 7.32M | 14.78M | 339K | 16.36M |
| Non-Interest Income % | 59.27% | -698.82% | -3735.86% | 922.2% | -118.32% | -27.39% | -214.74% | -35% | -50.49% | 171.4% | 23.03% | 162.52% | 171.73% | -807.71% | 240.98% | 122.16% | 3.06% | 135.05% |
| Total Net Revenue | 47.13M | 7.22M | 1.69M | -9.87M | 26.64M | 33.27M | 10.33M | 21.3M | 14.9M | 7.24M | -7.64M | 9.21M | 12.14M | -895K | 3.04M | 12.1M | 11.08M | 12.11M |
| Revenue Growth % | 424.29% | 327.86% | 117.09% | -137.05% | -19.91% | 221.97% | -51.5% | 42.96% | 105.89% | 194.76% | -182.94% | -24.14% | 1456.2% | -129.46% | -74.89% | 9.21% | -8.52% | - |
| Non-Interest Expense | 16.47M | 8.82M | 5.84M | 5.82M | 4.78M | 5.08M | 3.75M | 1.56M | 1.86M | 2.79M | 3.24M | 3.11M | 5.25M | 3.48M | 3.1M | 3.45M | 321K | 595.89K |
| Efficiency Ratio | 34.95% | 122.14% | 346.41% | -59% | 17.93% | 15.28% | 36.26% | 7.34% | 12.46% | 38.52% | -42.44% | 33.76% | 43.29% | -388.94% | 102.01% | 28.48% | 2.9% | 4.92% |
| Operating Income | 36.61M | -1.6M | -4.16M | -15.7M | 21.87M | 28.18M | 6.59M | 19.74M | 13.04M | 12.32M | 17.01M | 14M | 10.88M | 13.51M | 12.23M | 16.42M | 15.01M | 13.56M |
| Operating Margin % | 77.69% | -22.14% | -246.41% | 159% | 82.07% | 84.72% | 63.74% | 92.66% | 87.54% | 170.26% | -222.76% | 152% | 89.61% | -1509.61% | 402.47% | 135.66% | 135.42% | 111.94% |
| Operating Income Growth % | - | 61.56% | 73.51% | -171.78% | -22.41% | 327.92% | -66.63% | 51.31% | 5.86% | -27.57% | 21.55% | 28.68% | -19.5% | 10.5% | -25.52% | 9.4% | 10.67% | - |
| Pretax Income | -12.91M | -1.6M | -4.16M | -15.7M | 21.87M | 28.18M | 6.59M | 19.74M | 13.04M | 9.62M | -5M | 11.86M | 15.59M | 3.75M | 4.22M | 11.34M | 0 | 9.31M |
| Pretax Margin % | -27.39% | -22.14% | -246.41% | 159% | 82.07% | 84.72% | 63.74% | 92.66% | 87.54% | 132.87% | 65.47% | 128.76% | 128.44% | -418.77% | 138.97% | 93.68% | 0% | 76.9% |
| Income Tax | 205K | 1.06M | 1.48M | 1.49M | 715K | 401K | 222K | 239K | 34K | 25K | -87K | 0 | 160K | 240K | 231K | 340K | 0 | 0 |
| Effective Tax Rate % | -1.59% | -66.52% | -35.51% | -9.49% | 3.27% | 1.42% | 3.37% | 1.21% | 0.26% | 0.26% | 1.74% | 0% | 1.03% | 6.4% | 5.47% | 3% | - | 0% |
| Net Income | -13.11M | -2.66M | -5.63M | -17.18M | 21.15M | 27.78M | 6.36M | 19.5M | 13.01M | 9.59M | -4.91M | 11.86M | 15.43M | 3.51M | 3.99M | 11M | 0 | 9.31M |
| Net Margin % | -27.82% | -36.87% | -333.91% | 174.1% | 79.39% | 83.51% | 61.6% | 91.54% | 87.32% | 132.53% | 64.33% | 128.76% | 127.12% | -391.96% | 131.37% | 90.87% | 0% | 76.9% |
| Net Income Growth % | 45.19% | 52.76% | 67.22% | -181.25% | -23.87% | 336.55% | -67.36% | 49.87% | 35.65% | 295.22% | -141.44% | -23.16% | 339.85% | -12.1% | -63.7% | - | -100% | - |
| Net Income (Continuing) | -25.65M | -2.66M | -5.63M | -17.18M | 21.15M | 27.78M | 6.36M | 19.5M | 13.01M | 9.59M | -4.91M | 11.86M | 15.43M | 3.51M | 3.99M | 11M | 0 | 9.31M |
| EPS (Diluted) | -0.20 | -0.06 | -0.16 | -0.56 | 0.86 | 1.39 | 0.36 | 1.45 | 1.13 | 0.83 | -0.43 | 1.06 | 1.60 | 0.37 | 0.47 | 1.44 | 0.00 | 1.23 |
| EPS Growth % | 54.1% | 60.75% | 71.43% | -165.12% | -38.13% | 286.11% | -75.17% | 28.32% | 36.14% | 293.02% | -140.57% | -33.75% | 332.43% | -21.28% | -67.36% | - | -100% | - |
| EPS (Basic) | - | -0.06 | -0.16 | -0.56 | 0.86 | 1.39 | 0.36 | 1.45 | 1.13 | 0.83 | -0.43 | 1.06 | 1.60 | 0.37 | 0.47 | 1.44 | 0.00 | 1.23 |
| Diluted Shares Outstanding | 66.31M | 42.35M | 36.1M | 30.96M | 24.73M | 20.03M | 17.53M | 13.48M | 11.53M | 11.52M | 11.54M | 11.18M | 9.62M | 9.58M | 8.48M | 7.61M | 7.57M | 7.56M |
Quick answers to the most common questions about buying HRZN stock.
For fiscal year 2025, Horizon Technology Finance Corporation (HRZN) reported total revenue of $7.2M. This represents a 40.4% decline compared to $12.1M in 2009.
Horizon Technology Finance Corporation (HRZN) reported a net loss of $2.7M for the fiscal year ending 2025.
Horizon Technology Finance Corporation (HRZN) reported an operating income of $-1.6M, resulting in an operating profit margin of -22.1%. This margin reflects the operational efficiency of the business before interest and taxes.
Horizon Technology Finance Corporation (HRZN) generated $7.2M in gross profit for the year, representing a gross profit margin of 100.0%. This demonstrates the company's core pricing power and production efficiency.
Key Metrics
Top Statement Risk
Warrant mark-to-market destroying net income
Metrics are mathematically derived from official filings.
Core Lending Revenue Rebounds Sharply
According to HRZN's reported financials, net interest income rebounded to $17.1M in 2026Q2, an 18.4% year-over-year increase, recovering from a cyclical trough of $12.1M in 2025Q4, signaling that the core venture-lending book has stabilized after four quarters of sequential contraction.
The recovery in NII from $12.1M (2025Q4) to $17.1M (2026Q2) suggests either improved deployable capital, higher-yield origination activity in the venture debt market, or a more favorable rate environment for floating-rate loan portfolios. This rebound reverses a persistent downtrend that saw NII decline roughly 31% from $17.7M in 2024Q1, and the sequential improvement of 14.1% between Q1 and Q2 2026 appears materially stronger than the modest 0.9% gain booked in the prior quarter. Investors should monitor whether this acceleration reflects structural portfolio growth or a one-quarter catch-up from delayed interest accruals, as HRZN's venture-lending model is particularly sensitive to borrower credit events and prepayment behavior.
Non-Interest Income Destroys Earnings Quality
As reported in HRZN's financial statements, non-interest income swung violently from a $17.3M gain in 2025Q3 to a $5.9M loss in 2026Q2, reflecting the mark-to-market nature of warrant and equity investments that have repeatedly pushed total revenue into negative territory across four of the last ten quarters.
The pattern of non-interest income — swinging from -$34.3M in 2025Q1 to +$17.3M in 2025Q3 to -$5.9M in 2026Q2 — is the single largest driver of HRZN's earnings volatility and suggests that reported net income is substantially disconnected from operating performance. This line item is predominantly composed of unrealized gains and losses on warrant marks and equity positions in venture-backed portfolio companies, meaning HRZN's bottom line is levered to the mark environment of private technology valuations rather than to lending spread dynamics. The structural implication is that reported EPS is not a reliable measure of the company's recurring earning power, and investors should focus instead on NII trajectory and pre-provision operating income as the more stable earnings signals.
Provision Reversals Mask Underlying Credit Cycle
Based on HRZN's reported figures, the company recorded zero provision expense for seven consecutive quarters through 2025Q4, followed by negative provisions of $2.7M and $4.2M in 2026Q1 and Q2 respectively, indicating credit reserve releases rather than new charge-offs during a period of venture-sector stress.
The shift from zero provisions (2024Q2 through 2025Q4) to net reserve releases totaling $6.9M across the first half of 2026 is unusual for a venture lender, and may reflect portfolio company recoveries or management's assessment that previously reserved positions have improved in credit quality. However, this pattern also warrants scrutiny, as venture debt portfolios have historically experienced back-loaded credit losses, and the absence of provision charges across 2024–2025 — a period of elevated startup failures and down-round activity — may indicate reserves were set conservatively or that losses are being recognized through non-interest income writedowns rather than through the provision line. The four consecutive quarters of negative non-interest income during 2024Q4–2025Q2 could alternatively reflect equity-position impairments that economically function as credit losses but sit outside the traditional provision framework.
2026Q2 Net Loss Signals Deep Structural Dislocation
According to HRZN's income statement, 2026Q2 produced a $37.3M net loss driven by a $25.0M operating loss despite $17.1M in net interest income and a $4.2M provision release, revealing a severe disconnect between the core lending business and consolidated reported earnings.
The 2026Q2 loss is the most extreme in the ten-quarter series and is particularly concerning because it occurred during a quarter when NII was at its highest level since 2024Q1 and credit provisions were being released — both nominally positive developments. The gap between operating loss (-$25.0M) and net loss (-$37.3M) implies approximately $12.3M of below-the-line charges, potentially reflecting interest expense on unfunded commitments, preferred dividends, or additional equity-position writedowns not captured in operating income. This quarter represents a critical inflection point: if the underlying cause is permanent capital impairment on portfolio company equity stakes, HRZN's NAV trajectory and future origination capacity could be materially compromised even as NII recovers.
Core Lending Spread Is Not the Real Earnings Story
Based on HRZN's ten-quarter data, reported net income was negative in five of ten periods with cumulative losses exceeding $81M, while net interest income generated roughly $149M over the same span, suggesting that the venture-lending spread is being systematically overwhelmed by mark-to-market losses on equity-linked assets.
The strongest challenge to HRZN's earnings quality is that NII, while stable and recently improving, has never been sufficient to offset the magnitude of non-interest income losses in any given negative quarter. The peer comparison sharpens this concern: HRZN's NIM of 2.0% compares unfavorably to venture-lending peers, and its extreme revenue volatility — total revenue ranging from -$10.8M to +$60.4M — produces an efficiency ratio metric that is analytically meaningless for most periods. Additionally, the concentration of HRZN's losses in warrant and equity marks means that an improvement in private-market valuations could produce a large positive swing without any fundamental improvement in loan quality or origination economics, creating a risk that investors mistake mark-driven recoveries for operational improvement. Until the warrant and equity portfolio reaches a steady-state valuation or is fully exited, reported net income will remain an unreliable indicator of HRZN's underlying economic performance.
Efficiency Ratio Distorted by Non-Recurring Revenue Swings
As reported in HRZN's financials, the efficiency ratio ranged from 2.1% in 2026Q2 to 25.1% in 2026Q1, with several quarters showing no meaningful calculation at all, indicating that standard efficiency metrics are rendered inoperable by the extreme non-interest income volatility that dominates total revenue.
The efficiency ratio, which for a typical bank or BDC would be a reliable indicator of cost discipline, is here a function of whether non-interest income happens to be positive or negative rather than a reflection of operational leverage. When non-interest income turned sharply positive in 2025Q3 ($17.3M), the efficiency ratio compressed to 6.2%, but this apparent improvement was entirely driven by a one-time valuation gain rather than any reduction in operating expense. The more analytically useful framing is that HRZN's operating expense base appears relatively stable around $8–12M per quarter — but this fixed cost structure is being levered against a wildly unstable revenue base, meaning operating leverage is negative in practice even when absolute costs are well controlled.