Revenue volatility has intensified, with the firm reporting a negative $5.8M in 2025Q4 and a severe gross margin compression to -198.6%.
| Metric | 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 |
|---|
| Sales/Revenue | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Revenue Growth % | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Cost of Goods Sold | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| COGS % of Revenue | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Gross Profit | 12.9M | 14.59M | 5.46M | 4.49M | 40.16M | 6.51M | 23.58M | -970K | 16.54M | 28.92M | 10.84M | 17.15M | 12.68M | 1.24M |
| Gross Margin % | 60.85% | 41.47% | 20.24% | 23.1% | 74.33% | 29.18% | 56.17% | -9.89% | 69.56% | 83.09% | 49.89% | 100% | 100% | 100% |
| Gross Profit Growth % | -11.58% | 167.04% | 21.69% | -88.82% | 516.68% | -72.39% | 2531.24% | -105.86% | -42.8% | 166.73% | -36.78% | 35.3% | 924.82% | - |
| Operating Expenses | 1.94M | 4.44M | 4.29M | 5.87M | 7.42M | 4.5M | 4.35M | 3.96M | -9.46M | 6.42M | 3.84M | 3.24M | 2.91M | 287K |
| OpEx % of Revenue | 9.13% | 12.61% | 15.88% | 30.2% | 13.73% | 20.14% | 10.37% | 40.34% | -39.78% | 18.43% | 17.68% | 18.91% | 22.96% | 23.2% |
| Selling, General & Admin | 3.31M | 3.12M | 2.98M | 3.29M | 3.59M | 3.46M | 3.67M | 3.57M | 3.59M | 3.2M | 2.94M | 2.89M | 2.36M | 287K |
| SG&A % of Revenue | 15.58% | 8.87% | 11.04% | 16.9% | 6.64% | 15.49% | 8.73% | 36.45% | 15.08% | 9.19% | 13.54% | 16.87% | 18.61% | 23.2% |
| Research & Development | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| R&D % of Revenue | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Other Operating Expenses | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Operating Income | 10.97M | 10.16M | 1.18M | -1.38M | 32.74M | 2.02M | 19.23M | 31.9M | 26M | 22.51M | 18.74M | 15.07M | 8.65M | 790K |
| Operating Margin % | 51.72% | 28.86% | 4.36% | -7.1% | 60.6% | 9.03% | 45.81% | 325.41% | 109.34% | 64.66% | 86.22% | 87.89% | 68.23% | 63.86% |
| Operating Income Growth % | 8% | 762.87% | 185.23% | -104.22% | 1524.06% | -89.52% | -39.71% | 22.67% | 15.54% | 20.09% | 24.32% | 74.28% | 994.94% | - |
| EBITDA | 10.97M | 10.16M | 1.18M | -1.38M | 32.74M | 2.02M | 19.23M | 55.45M | 26M | 22.51M | 22.46M | 17.83M | 12.12M | 1.25M |
| EBITDA Margin % | 51.72% | 28.86% | 4.36% | -7.1% | 60.6% | 9.03% | 45.81% | 565.59% | 109.34% | 64.66% | 103.34% | 103.95% | 95.62% | 101.46% |
| EBITDA Growth % | 8% | 762.87% | 185.23% | -104.22% | 1524.06% | -89.52% | -65.32% | 113.22% | 15.54% | 0.2% | 25.97% | 47.08% | 865.9% | - |
| D&A (Non-Cash Add-back) | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 23.55M | 0 | 0 | 3.72M | 2.75M | 3.47M | 465K |
| EBIT | 10.97M | 10.16M | 1.18M | -1.38M | 32.74M | 2.02M | 19.23M | 18.12M | 26M | 22.51M | 22.46M | 18.25M | 12.67M | 1.25M |
| Net Interest Income | 21.49M | 18.87M | 39.25M | 35.07M | 32.98M | 37.99M | 0 | -12.27M | 40.98M | 33.11M | -5.4M | -4.34M | -2.91M | -305K |
| Interest Income | 37.36M | 40.79M | 60.79M | 50.02M | 46.85M | 53.8M | 0 | 53.79M | 48.22M | 39M | 36.9M | 29.91M | 18.21M | 0 |
| Interest Expense | 15.87M | 21.92M | 21.54M | 14.95M | 13.87M | 15.81M | 0 | 10.86M | 7.24M | 5.88M | 4.57M | 3.92M | 2.36M | 305K |
| Other Income/Expense | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Pretax Income | -4.9M | 10.16M | 1.18M | -1.38M | 32.74M | 2.02M | 19.23M | 5.85M | 12.25M | 24.36M | 17.89M | 13.91M | 9.77M | 950K |
| Pretax Margin % | -23.1% | 28.86% | 4.36% | -7.1% | 60.6% | 9.03% | 45.81% | 59.66% | 51.52% | 70% | 82.32% | 81.09% | 77.04% | 76.8% |
| Income Tax | 223K | 452K | 806K | 1.41M | 282K | 370K | 17K | -15.35M | 100K | 0 | 83K | 70K | 0 | 0 |
| Effective Tax Rate % | -4.55% | 4.45% | 68.48% | -101.74% | 0.86% | 18.35% | 0.09% | -262.54% | 0.82% | 0% | 0.46% | 0.5% | 0% | 0% |
| Net Income | 11.41M | 9.7M | 371K | -2.79M | 32.46M | 1.65M | 19.21M | 5.85M | 12.15M | 24.36M | 17.89M | 13.91M | 9.77M | 950K |
| Net Margin % | 53.78% | 27.57% | 1.37% | -14.33% | 60.08% | 7.37% | 45.77% | 59.66% | 51.1% | 70% | 82.32% | 81.09% | 77.04% | 76.8% |
| Net Income Growth % | 17.54% | 2515.63% | 113.32% | -108.58% | 1871.99% | -91.43% | 228.56% | -51.88% | -50.13% | 36.18% | 28.64% | 42.42% | 928% | - |
| Net Income (Continuing) | -5.12M | 9.7M | 371K | -2.79M | 32.46M | 1.65M | 19.21M | 5.85M | 12.15M | 24.36M | 17.89M | 13.91M | 9.77M | 950K |
| Discontinued Operations | 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 |
| EPS (Diluted) | 0.53 | 0.45 | 0.02 | -0.13 | 1.51 | 0.08 | 0.94 | 0.29 | 0.65 | 1.68 | 1.53 | 1.45 | 1.28 | 0.18 |
| EPS Growth % | 17.78% | 2531.58% | 113.15% | -108.61% | 1818.68% | -91.63% | 224.14% | -55.38% | -61.31% | 9.8% | 5.52% | 13.28% | 611.11% | - |
| EPS (Basic) | 0.53 | 0.45 | 0.02 | -0.13 | 1.51 | 0.08 | 0.94 | 0.29 | 0.65 | 1.68 | 1.53 | 1.45 | 1.28 | 0.18 |
| Diluted Shares Outstanding | 21.67M | 21.67M | 21.67M | 21.67M | 21.45M | 20.92M | 20.45M | 20.34M | 18.63M | 14.55M | 11.68M | 9.6M | 7.62M | 5.39M |
| Basic Shares Outstanding | 21.67M | 21.67M | 21.67M | 21.67M | 21.45M | 20.92M | 20.45M | 20.34M | 18.63M | 14.55M | 11.68M | 9.6M | 7.62M | 5.39M |
| Dividend Payout Ratio | 176.66% | - | - | - | - | - | - | 481.91% | 218.27% | 84.42% | 93.42% | 93.67% | 105.47% | 205.79% |
Portfolio Credit Quality Erosion
As reported in recent financial statements, MRCC's revenue trajectory has turned sharply negative, with the most recent quarter recording a -$5.8M figure, suggesting that the firm is struggling to maintain a stable interest-earning asset base amidst significant portfolio turnover or potential non-accrual events.
The extreme fluctuation from $11.4M in 2024Q3 to negative revenue in 2025Q4 indicates a breakdown in the core interest-generating engine. This volatility suggests that the company may be experiencing significant asset write-downs or reversals of previously accrued interest, which warrants further investigation into the underlying credit health of the unitranche portfolio.
Based on the provided income statement data, MRCC's gross margin has experienced severe degradation, swinging from a peak of 54.7% in 2024Q3 to a negative 198.6% in 2025Q4, highlighting a fundamental inability to cover the cost of capital during periods of portfolio stress.
The collapse in gross margins suggests that the cost of funding the portfolio is no longer being adequately offset by interest income. Investors should monitor whether this margin compression is a temporary byproduct of lumpy exit activity or a permanent shift in the yield profile of the lower middle market assets.
According to the historical income statement, MRCC's operating income has failed to scale with revenue, as evidenced by the shift from a 44.6% operating margin in 2024Q3 to a negative 13.4% in 2025Q4, indicating that fixed management fees are now exerting significant pressure on the bottom line.
The inability to maintain positive operating margins during revenue contractions suggests that the firm's cost structure is relatively rigid. This operating deleverage implies that the management fee structure may be disproportionately burdensome when the portfolio size shrinks, potentially limiting the firm's ability to recover profitability in the near term.
As indicated by the reported figures, MRCC's net income has been characterized by extreme volatility and frequent losses, with the most recent quarter showing a -$2.6M net loss, which raises concerns regarding the sustainability of the firm's dividend-paying capacity and overall earnings quality.
The frequent divergence between operating income and net income suggests that non-operating items or fair value adjustments are significantly impacting the bottom line. Analysts should be wary of relying on headline EPS figures, as the reliance on Level 3 asset valuations may mask underlying cash flow deficiencies.
Based on the reported financial data, the combination of negative revenue and persistent net losses suggests that MRCC faces a precarious financial position, with the potential for further NAV erosion if the current trend of portfolio contraction continues unabated in the coming quarters.
A skeptic would argue that the current income statement reflects a fundamental failure in the underwriting of unitranche debt, rather than mere cyclicality. The lack of consistent profitability suggests that the firm may be forced to rely on capital recycling or external financing to maintain operations, which could lead to further dilution for existing shareholders.
Quick answers to the most common questions about buying MRCC stock.
Monroe Capital Corporation (MRCC) is profitable, generating $11.4M in net income for the fiscal year ending 2025 with a net profit margin of 53.8%.
Monroe Capital Corporation (MRCC) reported an operating income of $11.0M, resulting in an operating profit margin of 51.7%. This margin reflects the operational efficiency of the business before interest and taxes.
Monroe Capital Corporation (MRCC) generated $12.9M in gross profit for the year, representing a gross profit margin of 60.8%. This demonstrates the company's core pricing power and production efficiency.