Goldman Sachs BDC, Inc Aktie

Good morning, and thank you for joining us. My name is Haley Neeven, Head of the Investor Relations team for Goldman Sachs BDC, Inc., and I would like to welcome everyone to the Goldman Sachs BDC, Inc. Second Quarter 2026 Earnings Conference Call. [Operator Instructions]

Before we begin today's call, I would like to remind our listeners that today's remarks may include forward-looking statements. These statements represent the company's beliefs regarding future events that, that by their nature, are uncertain and outside of the company's control. The company's actual results and financial condition may differ possibly materially from what is indicated in those forward-looking statements as a result of a number of factors, including those described from time to time in the company's SEC filings. This audiocast is copyrighted material of Goldman Sachs BDC, Inc. and may not be duplicated, reproduced or rebroadcast without our consent.

Yesterday, after the market closed, the company issued an earnings press release and posted a supplemental earnings presentation, both of which can be found on the homepage of our website at www.goldmansachsbdc.com under the Investor Resources section and which includes reconciliations of non-GAAP measures to the most directly comparable GAAP measures. These documents should be reviewed in conjunction with the company's quarterly report on Form 10-Q filed yesterday with the SEC. This conference call is being recorded today, Friday, August 7, 2026, for replay purposes.

I'll now turn the call over to Vivek Bantwal, Co-Chief Executive Officer of Goldman Sachs BDC, Inc.

Thank you, Haley. Good morning, everyone, and thank you for joining us for our second quarter earnings conference call.

Before we begin today, I have an announcement. My Co-CEO of GSBD and Head of America's Direct Lending platform, David Miller, has decided to step down as Co-CEO of GSBD effective December 31 of this year. At that point, I will become the sole CEO. David has worked at Goldman Sachs for 22 years and has 34 years in the private credit industry. Since co-founding the Specialty Lending Group in 2004, David has been an integral part of the private credit platform we have built at Goldman Sachs. David will remain in his current role as Co-CEO through the end of this year and then will be appointed an Advisory Director of Goldman Sachs. He will continue to serve as a member of the Private Credit Investment Committee, so we can continue to benefit from his years of experience. We want to thank David for his many years of leadership and contributions.

In connection with this transition, Justin Betzen has stepped into the role of Co-President and Co-COO alongside Tucker Greene. Justin is currently a Vice President of GSBD and has held several positions within GSAM, and he is currently a Managing Director and Senior Underwriter in GSAM Private Credit in the Americas. Justin initially joined Goldman Sachs in 2006. The platform will also continue to be supported by a deep bench of experienced investment professionals with significant industry and firm tenure. Our Head of Underwriting and Portfolio Management, Greg Watts; and Head of Originations, Steven Buddig, will be elevated to Co-Heads of Americas Direct Lending, and David will become Chairman of the GSAM Private Credit Direct Lending Group in the Americas. Collectively, Greg and Steven have over 45 years' experience in the industry and 33 years at Goldman Sachs.

Thanks, Vivek. I'm incredibly proud of what we've accomplished together and what this broader platform has achieved over the years. Looking back, I've seen the industry navigate multiple credit cycles, the ups and the downs, and I've watched the resiliency of the Goldman Sachs platform prove itself time and again. I've had the privilege of working alongside an exceptionally talented group of people. I know this fund and this platform are in great hands, and I have full confidence in my colleagues' leadership and continued success.

I also want to thank the Board of Directors for their partnership and support, our investors for their continued trust. And finally, my colleagues and team for their hard work and dedication in making this platform the best place to work throughout these years. It has been an honor to work with you all, and I'm excited to see your future success. I'll now turn the call back over to Vivek.

Now let's discuss GSBD's second quarter results. Along with David, I'm here today with Tucker Greene, our President and Chief Operating Officer; and Stan Matuszewski, our Chief Financial Officer. We'll start by offering our perspective on the current market environment. Then I will discuss our portfolio positioning and how the scale of Goldman Sachs' private credit ecosystem continues to translate into a competitive advantage for our shareholders. David and Tucker will walk you through portfolio activity and credit quality, and Stan will cover the financial results. We will then open the line for some Q&A.

In the second quarter, GSBD generated net investment income of $0.38 per share, representing an annualized yield on book value of approximately 12.6%. This increase reflects both higher total investment income and lower total expenses, which benefited from our shareholder-aligned incentive fee structure. Stan will discuss this in more detail later on. We ended the quarter with net asset value of $12.06 per share, down modestly just under 1% from $12.17 in the first quarter. Given these results, the Board has declared a third quarter 2026 base dividend of $0.32 per share payable to shareholders of record as of September 30, 2026, as well as a second quarter 2026 supplemental dividend of $0.03 to shareholders of record as of August 31, 2026. This brings our trailing 12-month total dividends to $1.54 per share and the annualized yield on our quarterly base dividend to approximately 14.1% based on yesterday's closing price of $9.09.

Our Board continues to evaluate the dividend each quarter based on the earnings power of the portfolio, the rate environment and our overall financial position.

Taking a step back to contextualize these results, let me start with the M&A environment. Deal activity has remained subdued during the second quarter of 2026, with overall private equity deal volumes down 38% quarter-over-quarter and sponsored loan issuance down 33%. For our business, that means the pace of new deployment opportunities has been slower. But what matters most is the quality of the deals coming to market and the terms available to lenders. As available capital in the direct lending market has contracted, driven in part by BDC redemptions and tighter fundraising conditions, borrowers and sponsors are accepting wider spreads, lower leverage and stronger documentation. That dynamic is directly benefiting the economics on every new investment we underwrite.

Simultaneously, AI disruption concerns and geopolitical uncertainty have added complexity to the backdrop. We continue to monitor how these dynamics are affecting business models across our portfolio. Tucker will discuss how our borrowers are navigating this when he covers credit quality. I'd also point out that uncertainty means lenders are being compensated more for providing capital, and we are capitalizing on that. Post quarter-end, we have also seen a pickup in M&A activity and deal flow, which positions us well to deploy into this attractive spread environment as we move through the second half of this year.

Across our borrower base, performance is differentiated. The majority of our portfolio continues to perform as anticipated. Companies with pricing power, mission-critical products and manageable leverage are executing well. Where we see stress is in a small number of companies carrying elevated leverage or facing sector-specific headwinds. These are the complex situations where our workout capabilities become most important. Tucker and David will walk you through a few recent outcomes that demonstrate what our platform and our process are designed to produce. David, let me turn it over to you for some perspective on what this means for our business.

Thanks, Vivek. This evolving landscape you just described is creating the kind of environment where our advantages are most pronounced. To put this in context, our platform manages over $150 billion in private credit, supported by more than 250 dedicated investment professionals and the relationships of over 3,000 Goldman Sachs investment bankers across our Global M&A and Capital Markets franchise. Goldman Sachs has been investing in private credit for over 30 years. That depth of experience across multiple credit cycles informs every underwriting decision we make.

We're focused on deploying capital selectively into the best risk-adjusted opportunities available. When deal flow is abundant and capital is plentiful, every lender looks similar. When deal flow slows and capital becomes scarcer, the differentiation becomes clear and the competitive landscape shifts. Borrowers need lenders who can provide certainty of execution, underwrite complex situations quickly and have the scale to deliver full capital structure solutions. That's where our platform stands out.

In June, our Private Credit platform closed a $455 million senior secured first lien term loan to Burgess Pigment Company, a leading specialty minerals processor. Goldman Sachs served as both agent and sole lender on this transaction. Given its scale, the borrower required a financing partner capable of underwriting the full commitment without the need for syndication. GSBD participated alongside other vehicles in our private credit ecosystem, and that multi-vehicle capacity is exactly what allowed us to win this on a bilateral basis. It is a clear illustration of how the breadth of our platform translates into differentiated deal flow for GSBD shareholders.

Transactions like Burgess reflect the type of selective deployment we are prioritizing, and the spread environment today means the economics on these opportunities are more attractive than what was available in prior quarters. But we remain patient and disciplined, investing only into the highest conviction opportunities while we focus on bringing leverage towards the lower end of our target range.

Thanks, David. Private credit has drawn significant attention in the first half of this year, and we are not immune to the headlines. But this is the environment where the actions managers take create the largest differentiation in outcomes. How you underwrite, how you manage workouts, the stability of your capital base and the discipline of your deployment are what will ultimately separate outcomes as this cycle plays out. The steps we've taken are designed to put GSBD on the right side of that divide. With that, Tucker, could you walk us through our deployment activity, the opportunities we're seeing in the market and how these dynamics are reflected in our portfolio composition?

Yes, sure. So our deployment approach this quarter was intentionally selective, not because of a lack of opportunity, but because we are prioritizing balance sheet management and credit selection. As our leverage comes down and we create additional capacity, we expect to deploy more actively into this attractive spread environment.

To elaborate on Vivek's comments regarding new deployment opportunities, we are seeing a meaningful shift in sectors where deal activity is concentrated. Software originations have showed across the industry, while we've seen increased activity in healthcare, business services and industrials. All of our new commitments this quarter were outside of software, not because we are avoiding the sector, but because the most compelling risk-adjusted opportunities this quarter were elsewhere. We continue to actively evaluate software deals and remain confident in our ability to underwrite the sector. When the right opportunity presents itself under the right terms, we will invest. GSBD's portfolio companies span across 39 industries and 173 borrowers, giving us the breadth to invest across the full opportunity set rather than depending on any single sector.

During the second quarter, we made new commitments of approximately $12.9 million across 9 portfolio companies, 2 of which are new borrowers. We also funded approximately $114 million of previously unfunded commitments. While the commitment level in the second quarter was modest, the quality and economics of what we deployed were improved. The weighted average spread on our second quarter originations was 511 basis points, wider than what we were originating 6 months ago. The weighted average loan-to-value on new deals was 37.4%, reflecting conservative entry points in the current valuation environment.

On the repayment and sales side, we received $146 million in total proceeds during the quarter. Net repayments exceeded new deployments, allowing us to use excess proceeds to reduce leverage. Our net debt-to-equity ratio is 1.35x at quarter end, but is now currently below our target of 1.25x, primarily due to repayment and sales activity since quarter-end. This is a meaningful shift that creates capacity for new deployment and positions us to reactivate our stock repurchase program.

At the end of the quarter, total investments in our portfolio were $3.2 billion at fair value, comprised of 98.6% in senior secured loans with a residual asset mix in the form of preferred and common stock as well as unsecured debt. The weighted average yield of our total debt and income-producing investments at amortized cost decreased to 9.5% compared to the first quarter. Weighted average net leverage and interest coverage remained slightly or rose slightly to 6.2x from 6x last quarter and interest coverage increased to 2x from 1.9x, respectively.

Turning to credit quality, an area of significant focus for the team. We ended the second quarter with nonaccruals of approximately 2.9% at fair value compared to 3.2% in the prior quarter. The number of companies on nonaccrual decreased from 11 to 10 during the quarter as 1 portfolio company was restored to accrual status. As mentioned on previous calls, we believe these nonaccrual names are idiosyncratic situations. They don't share a single cause, and they are not indicative of a broader portfolio trend. The large majority of our portfolio companies continue to perform well with continued revenue and EBITDA growth quarter-over-quarter and year-over-year across our borrower base. What we believe differentiates managers in this environment is the ability to identify problems early and manage through them effectively.

Within our Direct Lending Americas platform, workout and restructuring efforts are supported by a dedicated team that is embedded within a broader investment group. This includes select investment professionals supported by several senior professionals with extensive workout experience who are actively involved in managing complex situations. Critically, when faced with portfolio company distress, original deal captains remain closely engaged throughout the restructuring process, leveraging the long-standing knowledge of the borrower and the investment thesis from origination. They work in coordination with the dedicated restructuring team to ensure continuity, alignment and accountability. These team members are engaged proactively and frequently with sponsors and co-lenders to help maximize recoveries.

David, let me hand it to you on a couple of situations that played out this quarter.

Let me share two examples that demonstrate our workout team's capabilities in action. First is Thrasio, an Amazon e-commerce aggregator, which I'm sure is a name many of you recognize. Following its emergence from bankruptcy in 2024, our workout team has remained highly engaged through engagement with the Board, working closely with co-lenders, engaging deeply with management and leveraging the broader Goldman Sachs platform, we have focused on maximizing recovery value.

Specifically, the team capitalized on the value of Thrasio's individual brands through a series of successful divestments. This proactive approach resulted in a full paydown of our senior loan and over 75% paydown of a second-out position at par in this quarter, with full repayment expected in the second half of 2026.

Another example is Senneca Holdings, a specialty industrial door manufacturer, we have held in our portfolio since 2018. Performance has continued to improve following a restructuring in 2020. And in advance of upcoming maturities, our team engaged with the sponsor on a maturity extension to provide runway to further ramp performance and enhance our recoveries. Through this process, we successfully negotiated a 2.5-year maturity extension from the first lien lenders and elevated Goldman's subordinated notes within the cap stack, gaining higher seniority and increased cash pay component. Today, Senneca is in a much more stable footing with a rightsized capital structure positioned to support its ongoing operations and future growth. To further this point, the first-out term loan we hold was moved to accrual status within this quarter.

Both examples demonstrate our ability to maximize recovery through proactive engagement, working collaboratively with sponsors, co-lenders and management and drawing on the broader Goldman Sachs platform when it creates value.

With that, Stan walk us through the financial results.

For the second quarter, GAAP and adjusted after-tax net investment income were $42.2 million and $41.5 million, respectively, which is a material increase from $24.8 million and $24.7 million in the prior quarter. On a per share basis, GAAP net investment income was $0.38, equating to an annualized net investment income yield on book value of 12.6%.

As Vivek noted, total investment income rose to $83.7 million this quarter from $78.8 million last quarter, primarily as a result of restoring certain investments to accrual status and repayment activity. As we've previously discussed, there can be variability in our incentive fee due to the 3-year total return look back, which ties our advisers' compensation directly to the cumulative economic value delivered to shareholders, including both income and the impact of gains and losses rather than income alone. The look back in combination with the current period total return resulted in an incentive fee that was outsized last quarter, but no fee earned in the current quarter. Collectively, the higher top line and lack of incentive fee expense contributed to higher NII. Net investment income covered our dividend this quarter, and we hold approximately $100.3 million or $0.89 per share of undistributed taxable income at quarter end.

Turning to our balance sheet. We believe the strength of our liability structure is a deliberate competitive advantage, particularly in volatile markets. When certain lenders face pressure on their own financing, having committed long-dated facilities with established banking partners provides meaningful stability and reliability. Our revolving credit facility is committed across 12 bank lenders with no mark-to-market provisions. As of quarter end, we had approximately $796 million of borrowing capacity remaining under the facility and approximately $1.9 billion in outstanding debt across our entire financing package. Additionally, approximately 64% of our total principal amount of debt outstanding was in unsecured debt, which excludes the netting of unamortized debt issuance, costs and cumulative hedging adjustments for those borrowings that are designated in a fair value hedging relationship.

Our net debt-to-equity ratio was 1.35x as of June 30, 2026. While this leverage level is within our operating range, it is at the upper end of it. As Tucker noted, our pro forma leverage now stands below the 1.25x target, which provides us flexibility to repurchase stock under our 10b5-1 program. As announced on our last earnings call, the Board approved and authorized a new 10b5-1 stock repurchase program to allow the fund to repurchase up to 75 million of shares of common stock, subject to certain limitations, including leverage. Taken together, these developments support a clear path toward lower leverage and the ability to make new investments and return capital to shareholders. We will continue to update investors on our progress each quarter.

Thanks, Stan. In closing, although the private credit market continues to face headwinds, the fundamentals of our platform are strong. We remain focused on reducing leverage, making new investments at attractive economics and returning capital to shareholders. Thank you all for joining us today. Let's open the line for questions.

[Operator Instructions] We'll take our first question from Arren Cyganovich with Truist Securities.

First, I guess I'd like to say congrats to those that are changing roles. And David, I enjoyed working with you. So good luck in your future. And hopefully, we'll cross paths again.

Absolutely. Well, I'll be here until year-end and then on Investment Committee thereafter. So I'll be around for a while yet, but thank you.

Sounds good. From an investing environment standpoint, M&A picking up post-quarter, how are you thinking about that in terms of this vehicle? And are you seeing enough activity where it may create enough turnover in the vehicle that you can start to see some pickup in activity for GSBD?

Yes, it's a good question. Thanks for asking that. And then as you sort of alluded to, there's a couple of things going on here. So first is, as you point out, the activity that we -- remember, there's always a lag between when we sign up deals and when we fund deals. And so when you think about this most recent quarter for GSBD, the flow of new origination was on the slower side in part because the kind of lag effect of the M&A environment earlier in the year was quiet, coupled with the fact that, as you know, post last quarter, our leverage was running higher than our target. And so the combination of those two things led to a quieter period on a relative basis, from an origination perspective.

When you think about where we are, I think two things are different. One is, as you point out, the M&A environment is picking up again in this part of the market. So sponsor activity has picked up, and we are actively involved in and have actually been signing up recently kind of deals sort of in different parts of the platform. And then the second piece of it is, as we noted, our leverage is kind of back down, particularly post-quarter-end to sort of where our target is. And so we do expect that we'll have more to do on the origination side going forward. And then I think the third piece embedded in your question is really around kind of turnover of some of the legacy portfolio. And as we've talked about in the past, that will continue to kind of move along at its own pace. But now that our leverage is kind of where we want it to be and sort of deal volume is picking up, we'll still be able to kind of add some of the newer originations that reflect the new kind of integrated go-forward platform. And over time, that will continue to dilute the legacy names.

In the investments that you highlighted that's kind of shifting industries a bit and what I found interesting was that you said you're not ignoring the software sector. I would imagine that your bar is probably a bit higher now. Are you seeing any activity on the software side that would be kind of, I don't know, if you want to call it, green shoots for an industry that used to do a lot of activity, but maybe some positive aspects that might unlock some activity in that sector going forward?

Yes. So I'd say a few things. There have been a couple of transactions, both in the U.S. and in Europe in the broadly syndicated market that I think are useful data points to just think about where public credit is kind of willing to price these software names. And so I think that, that is just kind of constructive in terms of price discovery and knowing that, that option is out there for borrowers.

From a private credit perspective, we've been pretty quiet. There has not been, as you can imagine, a lot of new software activity. I think that's less about lending and more about kind of just bid-ask because I think that one of the unresolved questions in and around AI is really around terminal value. And so even if your loan is well covered, it's 30x -- if a company used to be worth 30x and now it's worth 20x or 18x that might not impact how you think about your loan that's levered at 6x, but that's a pretty big bid-ask from an equity valuation perspective. And so I think new deal activity continues to be on the quiet side.

We have seen some smaller add-ons. And I think that there is starting to emerge a market for kind of smaller sort of tuck-in add-ons that sponsors are starting to do, point one. And then point two is, I think that in terms of how software is actually performing, I think when you think about our AI framework that we've talked about that we've had in place now, elements of it really going back to 2023, I think what we're seeing has kind of been consistent with that platform, which is for incumbent software providers that are verticalized in their industry, that own their customers with high switching costs, and own their data, so proprietary data angle. Those companies are actually performing quite well. And in fact, those companies are actually kind of performing better than sort of the book as a whole.

And so I think that -- and you see this in kind of public market pricing, both in equity and credit, which is now versus February, I think there's a much more -- much better appreciation around the fact that not all software is created equally. And I think the market has kind of had some more time to dig into kind of pricing different software providers based on kind of their characteristics, which I think is also a good step forward.

All right. That's helpful. And then lastly, just a kind of quick one on the quarter. The interest income rebounded nicely. And I think I saw in the release that there was partly attributed to the -- putting one of your nonaccruals back on to accrual status after it had better performance. Is there a sort of like a catch-up amount of interest income that was booked in the quarter that was related to that?

This is Stan. Yes, that's right. So restoring two of our names to accrual status, particularly Thrasio did include a pickup in income, and we accelerated some of our OID as we were paid on certain names, including Thrasio partial repayment.

Is there any way you can like frame what that would be from like a onetime perspective versus is that going to carry forward into the next quarter at the same level?

We had around $5 million of income, I would say, from onetime items, like I said, the accelerated OID as well as a pickup from the restoration to accrual status that we wouldn't necessarily expect to recur. However, given the pickup in M&A, as we may see some other repayments, we could continue to see similar activity.

And next, we'll go to Finian O'Shea with Wells Fargo Securities.

I echo the sentiments toward David and I hope you stick around for time to come. So on the sort of new framing on maybe leverage and buybacks or at least a little bit shifted downward on the leverage side. Can you put some, I guess, sort of meat on the bone there? What do you want leverage to sort of go down to? And then how aggressive will you be on buybacks? And then I guess, tie in there, if so, sort of why now with the sort of legacy issues pretty consistently playing out as a headwind?

Yes. Fin, it's David. Yes, from a leverage perspective, look, we came down at quarter end, we were at 1.35x post quarter-end due to some repayments and sales, we're under the 1.25x, probably closer to 1.2x today. With that level, we do anticipate reactivating some buyback. But we want to mix that between the stock buybacks and new opportunities that we see in the market and deployment. So it's going to be a mix between that.

We do think, given where the portfolio is senior secured, we think we're hopefully behind the worst of it from some of the legacy assets and the markdown that that's a comfortable level going forward. In addition to that, I think you've seen some pickup in the repayment activity. The BSL market has picked up. So post quarter-end, we've seen additional repayments, which will allow us to reinvest in new deals and support that stock buyback activity.

Okay. That's helpful. And I guess with the -- I guess, on the mix of leverage, are there implications there on the dividend that's still declared into the third quarter, but seeing if there's some color on the path forward?

Sure, Fin. So, it's Stan. We continue to discuss this with our Board of Directors. I'd say that we intend to maintain the current $0.32 base dividend in the near term. That is something, obviously, we continue to assess. We think that, that dividend coverage is going to be helped in part by the fact that the incentive fee that we expect to accrue over the next couple of quarters is going to be more muted as a result of that look back. But we'll continue to assess, especially given the portfolio is predominantly floating rate as we watch changes in the SOFR curve or the base rates as well as trends in what kind of spreads we'll get on new originations.

And next, we'll go to Heli Sheth with Raymond James.

Going back to deal activity being concentrated in specific sectors, I believe you said healthcare, business services and industrials. Are you seeing anything different with origination spreads and pricing in those sectors relative to other sectors?

Yes. Look, I'd say that it depends on kind of what you're comparing to and sort of reference point. So I'd say if you think about spreads relative to [ SOFR ] and to give it apples-to-apples, let's think about large-cap sponsor just as one benchmark. If you think about large-cap sponsor spreads since the end of last year, where at some point in the fourth quarter, we had gotten to kind of a local-type point, spreads are wider than that. There was a period in March and April where spreads had kind of widened out sort of really into the 5s, low 5s, maybe even a few deals in sort of mid-5s, and I think that things have kind of settled out now sort of depends on the type of deal, but it settled out in the 475 basis points to 500 basis points range for, again, depending on the credit in large-cap sponsor land, middle market will come at a little bit of a premium to that.

But I'd say that's kind of where the market is. And then within that, in terms of industry differentiation, I wouldn't say that there's necessarily a difference in sort of spreads across industries. I think it's more the leverage that we think about is really specific to the business. And obviously, the macro of the industry plays into what type of leverage we think is appropriate for any particular business.

Got it. That's helpful. And then on the portfolio as a whole, any incremental detail into what we should expect in terms of the pacing of originations and repayments throughout the rest of the year? Obviously, there were elevated payments -- repayments relative to originations for this quarter. Is that something we should continue to expect?

Yes. Look, I think we've seen into the third quarter, certainly some elevated repayment activity. We talked about that's kind of why our leverage has come down here. A little hard to predict how that plays out the rest of the year. We're going to have to wait and see. But we do see with elevated BSL activity, the M&A pickup that Vivek talked about that we do anticipate that those repayments are going to be higher, which will just give us a chance to rotate that money into new deals that we're seeing across the platform today.

We'll next go to Ethan Kaye with Lucid Capital Markets.

Just hoping you can kind of characterize the unrealized depreciation during the quarter, right? Like how much of that was mark-to-market driven versus kind of specific name driven? And then given your recent commentary just now on kind of spread stabilization, are you seeing any pull to par reversal here as loans progress towards maturity?

Sure. So I'd say that a portion of it was driven by -- was more broad brushed throughout the quarter, maybe about half. And then I'd say the other half was coming from investments that we've talked about in the past, names that have either gone through a workout or restructuring where we can continue to see some pressure in the performance.

Thank you. And I'd now like to turn the call back over to Vivek for any closing or final remarks.

Great. Thank you, everyone, for joining us. We appreciate your support, and we'll talk to you soon. Have a good day.

Good morning, and thank you for joining us. My name is John Silas, a member of the Investor Relations team for Goldman Sachs BDC, Inc., and I would like to welcome everyone to the Goldman Sachs BDC, Inc. First Quarter 2026 Earnings Conference Call.

[Operator Instructions]

Before we begin today's call, I would like to remind our listeners that today's remarks may include forward-looking statements. These statements represent the company's belief regarding future events that, by their nature, are uncertain and outside of the company's control. The company's actual results and financial condition may differ, possibly materially, from what is indicated in those forward-looking statements as a result of a number of factors, including those described from time to time in the company's SEC filings.

This audiocast is copyrighted material of Goldman Sachs BDC, Inc. and may not be duplicated, reproduced or rebroadcasted without our consent.

Yesterday, after the market closed, the company issued an earnings press release and posted a supplemental earnings presentation, both of which can be found on the homepage of our website at www.goldmansachsbdc.com under the Investor Resources section and which include reconciliations of non-GAAP measures to the most directly comparable GAAP measures. These documents should be reviewed in conjunction with the company's quarterly report on Form 10-Q filed yesterday with the SEC. This conference call is being recorded today, Friday, May 8, 2026, for replay purposes.

I'll now turn the call over to Vivek Bantwal, Co-CEO of Goldman Sachs BDC, Inc.

Thank you, John. Good morning, everyone, and thank you for joining us for our first quarter earnings conference call. I am here today with David Miller, our Co-Chief Executive Officer; Tucker Greene, our President and Chief Operating Officer; and Stan Matuszewski, our Chief Financial Officer.

I would like to begin by providing important context on the composition of our portfolio, followed by sharing perspective on the current macro backdrop and our rigorous approach to valuation, particularly around our commitment to transparent mark-to-market accounting. I'll then highlight our perspective on why we continue to see private credit as a highly attractive asset class and why our GS platform is uniquely positioned to thrive in the current investment landscape, particularly over time as we transition away from the legacy portfolio. I'll then turn the call over to David and Tucker, who will dive into our first quarter results, portfolio activity and performance before handing it off to Stan to take us through our financial results. And finally, we'll open the line for Q&A.

As we have discussed on prior calls, since GSBD's integration into the broader direct lending platform in 2022, we have been on a deliberate path to leverage the differentiated sourcing, underwriting and portfolio management oversight provided by access to the full Goldman Sachs private credit ecosystem where we have a 30-year track record. What you're seeing in our results today is the natural transition of our balance sheet. We are moving out of older positions from the legacy setup and into new opportunities that benefit from our enhanced sourcing and deeper origination funnel.

Currently, about 58% of our portfolio consists of these more recent originations, while the remaining 42% represents older positions. The results of this strategic shift are clear. The 58% of the portfolio originated under our current underwriting capabilities is performing in line with expectations. In fact, we have seen low losses and only one name representing less than 0.5% of our total nonaccrual at cost. While we have seen some modest unrealized moves here, we believe those are primarily a reflection of broader market spread widening, not a sign of credit deterioration. This gives us immense confidence in our current credit selection process.

As we've discussed, the 42% of the book consisting of legacy positions is where we see the bulk of our current credit volatility, accounting for roughly 72% of losses this quarter and over 99.5% of our total nonaccruals at cost. We've added 2 of these names to nonaccrual status this quarter, One GI LLC and 3Si Security Systems, Inc., which we view as idiosyncratic situations that we have been monitoring closely. Our internal workout teams are deeply engaged with these borrowers to maximize recovery.

This brings me to a critical distinction that we believe is essential for our investors to understand the difference between mark-to-market fluctuations and actual credit impairment. When the market price of risk increases, as evidenced by today's widening credit spreads, the mark-to-market value of existing loans naturally declines. This decline is not a reflection of the borrower's ability to pay but rather a result of current market demand for higher returns on the same level of credit risk. If the credit remains sound and ultimately repays at par, the investor recovers the full principal amount regardless of any interim price volatility through the life of the loan.

On the other hand, true credit impairment occurs when a borrower's financial condition deteriorates to where they can no longer meet their obligations, resulting in a permanent loss of capital. This distinction is especially important in periods of heightened volatility when mark-to-market valuations will fluctuate to reflect market sentiment but underlying credit risk and borrower solvency remains stable. We view the losses we are seeing in the post-integration portfolio as the former type, mark-to-market in nature, while the credit impairment we are addressing is concentrated in the legacy portfolio.

Looking back on the first quarter, the extent to which the market was affected by global geopolitical uncertainty, AI disruption across the software sector and a softer-than-anticipated M&A landscape is clear. The return of M&A activity in the second half of 2025 resulted in an increased number of deal closings in the first quarter of 2026. However, volumes were heavily skewed toward a small number of large-cap deals with sponsor activity continuing to lag and remaining below 10-year averages.

Despite the growing backlog, the risk-off sentiment across the market in Q1 drove the total U.S. private equity deal value down to the lowest since Q2 2025 levels. Although a more stable rate environment could help over time, any immediate recovery, particularly in the middle market remains uncertain. In times like these, when market uncertainty leads to increased volatility, our financial position, including valuation, remains our top priority.

GSBD's quarterly valuation process, which aligns with our broader BDC complex is conducted by 3 independent sources: The private credit investing team; our valuation oversight group, which is independent of the investment decision-making process; and independent third-party valuation advisers, all of whom are subject to oversight by our independent Board of Directors. This multistep approach is intended to provide robust checks and balances and to support fair value determinations that are consistent, well documented and aligned with applicable regulatory standards. As we look across the landscape of early 2026, we believe the fundamental health of the private credit industry remains strong.

Despite recent headlines, the data tells a story of continued resilience amidst some manager performance dispersion that is expected to continue. Default rates across both public and private credit markets remain at relatively low levels. To put this in perspective, the payment default rate for broadly syndicated loans in the public market stood at just 1.44% as of March 2026. This is well below the 10.8% peak default rate we witnessed during the global financial crisis. Performing senior secured credit portfolios benefit from fixed maturities and change of control provisions that generate par repayments and natural liquidity, further underscoring the structural advantage from a risk perspective of holding senior debt. We now expect to have the ability to reinvest proceeds from recent exits at wider spreads and more attractive risk-adjusted levels in the current environment.

We would also note that recent media coverage of private credit has at times lacked necessary nuances. There is a tendency to conflate distinct segments of the credit markets, creating the impression of a broad "private credit problem" where in reality, stress is focused on certain pockets of the market. Looking ahead, if economic conditions were to soften, we would naturally expect to see an increase in nonaccrual rates and a greater performance divergence among managers. We believe the best way to prepare for such a shift is through the same disciplined underwriting culture and rigorous investment process that have guided our platform for 30 years. In periods of heightened market uncertainty, these principles are not just our foundation, they are our greatest competitive advantage.

Another key focus for us has been the deliberate reduction of annualized recurring revenue ARR loans within our portfolio relative to the legacy setup. Within GSBD, we have successfully lowered our ARR exposure from nearly 39% of the portfolio during Q3 2022 at fair value to under 10% today. This shift is highly intentional and aligns with broader market trends, which we have highlighted earlier. While ARR lending served a purpose during the rapid growth cycles of previous years, the current environment demands a more rigorous approach. We are seeing a clear market-wide rotation away from revenue-based metrics in favor of traditional cash flow supported structures.

We are proactively managing our legacy ARR positions through strategic exits or by facilitating conversions to EBITDA-based loans as these companies mature and are very selective in underwriting new ARR deals that are brought to market. By prioritizing these cash flow-centric assets, we are helping to ensure that our portfolio remains resilient and well positioned to deliver durable value to our investors. With heightened focus surrounding the software industry in recent months, our framework has continued to evolve as the landscape develops. While we are not immune to the fears of AI disrupting the software landscape, we remain confident in our ability to thoughtfully assess and help mitigate AI-related risks across both our current portfolio and new investment opportunities.

With that, let me turn it over to my co-CEO, David.

Thanks, Vivek. I'd now like to turn to our first quarter results. Our net investment income per share for the quarter was $0.22 and net asset value per share was $12.17 as of quarter end, down approximately 3.7% from the fourth quarter, driven primarily by an increase in unrealized losses. NII this quarter was also impacted by higher incentive fee accrual under our shareholder-friendly fee structure. As a reminder, GSBD's incentive fee is subject to a 3-year total return look back, which ties our adviser's compensation directly to the cumulative economic value delivered to shareholders, including both income and the impact of gains and losses rather than income alone.

While this weighed on reported NII in the quarter, it underscores the strong alignment between Goldman Sachs and our shareholders. The Board declared a second quarter 2026 base dividend of $0.32 per share payable to shareholders of record as of June 30, 2026. We ended the quarter with a net debt-to-equity ratio of 1.37x as of March 31, 2026, as compared to 1.27x as of December 31, 2025. We have maintained a conservative liability profile with no near-term unsecured maturities and a deliberately laddered bond maturity schedule. Our liquidity is underpinned by a diversified committed revolving credit facility across 15 bank lenders, structured with no mark-to-market exposure.

Market confidence in our platform remains durable as evidenced by the continued strong oversubscription on our recent bond issuances. We consistently look to enforce proactive capital management to ensure we remain well positioned to execute our strategy regardless of broader market volatility. During the quarter, we made new commitments of approximately $46.5 million across 17 portfolio companies comprised of 6 new and 11 existing portfolio companies. 91.6% of our originations during the quarter were in first lien loans, which reflects our bias to investments that are at the top of the capital structure.

Turning to portfolio composition. As of March 31, 2026, total investments in our portfolio were $3.23 billion at fair value, comprised of 98.7% in senior secured loans, 1% in a combination of preferred and common stock, 0.3% of unsecured debt and a negligible amount in warrants.

With that, let me turn it over to Tucker to discuss repayments, fundamentals and credit quality.

Thanks, David. I'll first discuss the portfolio in more detail. At the end of the first quarter, the company held investments in 173 portfolio companies operating across 40 different industries. The weighted average yield of our total debt and income-producing investments at amortized cost at the end of the first quarter remained flat at 9.9% compared to the fourth quarter. Importantly, our portfolio companies have continued to have both top line growth and EBITDA growth quarter-over-quarter and year-over-year on a weighted average basis.

The weighted average net debt to EBITDA of the companies in our investment portfolio increased slightly to 6x during the first quarter compared to 5.9x during the fourth quarter. At the same time, the current weighted average interest coverage of the companies in our investment portfolio at the end of the first quarter slightly decreased to 1.9x compared to 2x during the fourth quarter due to rounding. Our repayments during the first quarter totaled $82.8 million. Over 53% of this repayment activity was from pre-2022 vintage loans, demonstrating effective management of our assets.

On the prepayment side, we continue to selectively pursue opportunities that support prudent leverage management with the goal of reducing leverage over time. On May 6, 2026, the Board approved and authorized a new 10b5-1 stock repurchase program to allow the company to repurchase up to $75 million of shares of the company's common stock, subject to certain limitations. The company expects to enter into this 10b5-1 stock repurchase program once the 2025 10b5-1 plan has been fully utilized or expires.

And finally, turning to asset quality. We ended the first quarter with nonaccruals at approximately 4.7% of the portfolio at amortized cost, up from 2.8% in the prior quarter. While we never like to see this metric move upward, it is important to look at what is driving this change. The increase was primarily driven by 2 specific legacy investments that we have been monitoring closely, One GI LLC and 3Si Security Systems, Inc., which were placed on nonaccrual status due to financial underperformance. We view these as idiosyncratic situations rather than a reflection of broader portfolio stress.

If you look at our new vintage originations, those made since 2022, which now represent 58% of our fair value. Credit performance remains sound with minimal nonaccruals. I did want to be clear about one thing. We do not view the legacy portfolio as a category that is migrating wholesale toward nonaccrual. In fact, subsequent to quarter end, we favorably restructured one of our legacy positions, leading to higher cash pay and improved seniority in the capital structure and received a full repayment at par on a separate legacy holding. The firm continues to maintain a proactive approach to monitoring, managing and resolving any associated credit issues.

I will now turn the call over to Stan to walk through our financial results.

Thank you, Tucker. We ended the first quarter of 2026 with total portfolio investments at fair value of $3.2 billion, outstanding debt of $1.9 billion, and net assets of $1.4 billion. As David mentioned, our ending net debt-to-equity ratio as of the end of the first quarter was 1.37x. At quarter end, approximately 62.5% of our total principal amount of debt outstanding was in unsecured debt. As of March 31, 2026, the company had approximately $974 million of borrowing capacity remaining under the revolving credit facility.

As discussed last quarter in our Q4 earnings call, we wanted to remind investors of recent activity that occurred during Q1. On January 15, 2026, we borrowed $505 million under the revolving credit facility and used the proceeds together with cash on hand to repay the 2026 notes plus accrued and unpaid interest in full satisfaction of our obligations under the 2026 notes. Additionally, on January 28, 2026, we issued $400 million of 3-year investment-grade unsecured notes with a coupon of 5.1%. We also hedged the issuance by swapping the coupon from fixed to floating to match GSBD's floating rate investments. Over 100 investors participated in the company's day of live deal marketing, which resulted in the peak order book being 7.3x oversubscribed on our $300 million starting size.

Subsequent to quarter end, in early May, we closed our amend and extend on the Truist revolving credit facility, reducing the size of the facility from $1.5 billion -- to $1.5 billion from approximately $1.7 billion to take out 3 non-extending lenders from last year, extending the maturity date to May 2031 from June 2030, removing the 10 bps credit spread adjustment from the drawn margin and reducing undrawn fees by 5 bps as well as adding flexibility to unsecured debt baskets, among other borrower-friendly changes.

Before continuing to the income statement, as a reminder, in addition to GAAP financial measures, we also reference certain non-GAAP or adjusted measures. This is intended to make our financial results easier to compare to the results prior to our October 2020 merger with Goldman Sachs Middle Market Lending Corp., or MMLC. These non-GAAP measures remove the purchase discount amortization impact from our financial results.

For the first quarter, GAAP and adjusted after-tax net investment income were $24.8 million and $24.7 million, respectively, as compared to $42.2 million and $41.8 million in the prior quarter. On a per share basis, GAAP net investment income was $0.22, equating to an annualized net investment income yield on book value of 7.2%. While net investment income for the quarter was below our quarterly dividend, we utilized a portion of our undistributed taxable net income to provide a consistent dividend to our existing shareholder base. Total investment income for the 3 months ended March 31, 2026, and December 31, 2025, was $78.8 million and $86.1 million, respectively. Our remaining undistributed taxable net income as of March 31, 2026, was approximately $94 million or $0.84 on a per share basis, providing meaningful cushion to support our dividend going forward.

With that, I'll turn it back to Vivek for closing remarks.

Thanks, Stan, and thanks to everyone for joining our earnings call. We are excited to continue turning over the portfolio into new attractive opportunities using the full breadth of the Goldman Sachs platform while continuing to navigate through this market environment with humility and continued heightened discipline.

With that, let's open the line for Q&A.

[Operator Instructions] We will take our first question from Arren Cyganovich with Truist Securities.

In terms of the pipeline of investment activity, maybe you touch a little bit about what you're seeing there, what sponsors are saying, how they're adjusting to kind of wider spreads and tighter documentation? And how long might it take to kind of rotate out of the legacy and have more of the newly originated loans in the portfolio?

Arren, it's Vivek. Thanks for the question. I'd say a few things. I think that, obviously, you mentioned some of the kind of private equity-specific sort of things that are floating around out there. Beyond that, there's obviously kind of the geopolitical uncertainty and other things, too. So what I would say is, on the one hand, relative to where we were at the end of last year, deal activity is a little bit quieter overall. But on the other hand, with some of the retail pullback that you've seen from the non-traded BDCs for the deals that are getting done, it does seem like the pendulum is kind of swinging back in the direction of lenders in terms of just spreads and kind of leverage coming down a little bit, kind of documentation, et cetera.

So on the deals that we are competing on right now, we really like those deals. We like the spreads that we're getting on those deals. And we find that there's just far less competition than there was, particularly sort of as we started to get into the end of 2025. And so that's a dynamic that we're actually excited about, again, notwithstanding just some of the broader sort of noise out there.

And so, look, in terms of the second part of your question, that number kind of keeps kind of ticking down. We expect that number will kind of continue to tick down. And as that number ticks down, we'll be able to redeploy not just with the benefit of kind of the sort of post-integration sort of platform but also with the benefit of this kind of better spread environment in terms of what's going on out there.

And with the credit -- the 2 new credit nonaccruals that popped up, maybe you can provide a little bit of detail about are these older vintage? Are they something specific COVID-related, et cetera? And how much of the NAV decline in the quarter was related to those 2 nonaccruals?

Yes. So it's David. From a credit mark perspective, about 60% of the marks that we saw were credit-specific events, those 2 being big ones in here plus some other legacy assets that we marked down during the quarter, including some names that we've talked about in the past. With those 2 events, one is in the PPM space. As you know, it's -- that space has been challenged over the last number of years. We're continuing to work with the sponsor now to optimize recoveries for the lenders there. Those conversations are ongoing.

The other one, which was 3Si, if you look back over the past, had made some acquisitions, not all of the acquisitions have worked out like they thought. So leverage is elevated at this point in time, and that's why we put on nonaccrual. And once again, we're in active dialogue with the sponsors and our other lenders to optimize recovery.

We will take our next question from Ethan Kaye with Lucid Capital Markets.

Appreciate the commentary on kind of the pre-integration legacy assets versus the newly originated. But curious if you can kind of talk about maybe the outlook for rotating out of some of these legacy assets, particularly the underperformance -- sorry, the underperformers. Do you kind of have any visibility there on that?

Yes. I mean, if you see in the results, we had relatively light repayments in the first quarter. I think as we look into the second quarter, we've had an acceleration of that. I think we've already got over $100 million in repayments from a number of legacy names. So we're encouraged by that results. We're going to continue to address that proactively as they come up. We've got some maturities in the next 12 to 18 months of those legacy stuff. So we're going to be working hard to cycle out of those names and redeploy it into kind of the One GS ecosystem that we're operating in today with our new origination system and, frankly, better spreads that we're seeing out here today.

So we're optimistic. It's really hard to pinpoint exactly when these are going to be rotated out. But we've made decent progress, albeit slower than we like, and we'll continue to work on that in the coming quarters.

I would just add, I think the power of the One GS ecosystem is even more powerful in this environment, particularly what you're seeing going on with the retail flows in the non-traded BDC space because for us, the vast majority of our platform is institutional drawdown capital, about 83%. Our entire BDC complex is something like 17%. And so what that means is for this -- for GSBD, which is obviously an important part of our broader kind of complex, it's going to be able to compete in a more scaled way than it could if it was just a stand-alone entity. And there's very few, if anyone, out there right now as we're competing on deals that is showing up with the type of scale that we have in terms of solving problems or solving capital needs for clients as they're trying to put finances together on new deals.

So again, there are fewer new deals overall, but for the deals that are happening, our ability to source them on a differentiated basis and provide entire capital structure solutions because we're not as levered to some of the phenomena that's going on out there, I think is going to really help us. But to your point, it is going to be a little bit of a process as we continue to kind of roll out of some of these older names.

Great. That's good color. And then one other on the dividend. So you maintained the dividend in 2Q. You talked about using spillover this quarter to kind of cover the shortfall. Just kind of curious how long you're comfortable doing that? And if you could remind us maybe what are some of the levers that you feel you have to kind of get dividend coverage maybe back up to a more sustainable level here?

Yes. I mean, look, I mean, a very fair point. I think if you look at our results this quarter, they were negatively impacted by an outsized incentive fee. As a reminder, we've got a 3-year look back that's very shareholder-friendly on that incentive fee where it was elevated this quarter. But if you roll that forward over the next couple of quarters, we view a more muted incentive fee as a result of the same policy, which is certainly going to support the dividend in the near term. And it's our intent -- we obviously have to consult with our Board, but it would be our intent in the near term to maintain our dividend.

There are no further questions at this time. I will turn the conference back to Vivek for any additional or closing remarks.

Thanks, everyone, for joining. We appreciate your support and look forward to continuing the dialogue. Have a great weekend.

Good morning. This is John Silas, a member of the Investor Relations team for Goldman Sachs BDC, Inc. and I would like to welcome everyone to the Goldman Sachs BDC, Inc. Fourth Quarter and Fiscal Year-End 2025 Earnings Conference Call.

[Operator Instructions] Before we begin today's call, I would like to remind our listeners that today's remarks may include forward-looking statements. These statements represent the company's belief regarding future events that, by their nature, are uncertain and outside of the company's control. The company's actual results and financial condition may differ, possibly materially, from what is indicated in those forward-looking statements as a result of a number of factors, including those described from time to time in the company's SEC filings.

This audiocast is copyrighted material of Goldman Sachs BDC, Inc. and may not be duplicated, reproduced or rebroadcasted without our consent.

Yesterday, after the market closed, the company issued an earnings press release and posted a supplemental earnings presentation, both of which can be found on the homepage of our website at www.goldmansachsbdc.com, under the Investor Resources section and which includes reconciliations of non-GAAP measures to the most directly comparable GAAP measures. These documents should be reviewed in conjunction with the company's annual report on Form 10-K filed yesterday with the SEC.

This conference call is being recorded today, Friday, February 27, 2026 for replay purposes.

I'll now turn the call over to Vivek Bantwal, Co-CEO of Goldman Sachs BDC, Inc.

Thank you, John. Good morning, everyone, and thank you for joining us for our fourth quarter and fiscal year-end 2025 earnings conference call. I am here today with David Miller, our Co-Chief Executive Officer; Tucker Greene, our President and Chief Operating Officer; and Stan Matuszewski, our Chief Financial Officer.

I would like to start by highlighting GSBD's progress since our integration, followed by an overview of our platform's activity during 2025. I'll then spend some time sharing our perspective on current market conditions amidst most recent headlines in the software space. I'll then turn the call over to David and Tucker, who will dive into our fourth quarter results portfolio activity and performance before handing it off to Stan to take us through our financial results. And finally, we'll open the line for Q&A.

Since GSBD's integration into the broader direct lending platform in 2022, we've enhanced our sourcing, underwriting and portfolio management oversight. This quarter, the proportion of our portfolio benefiting from the 2022 reorganization has grown to 57%, while 43% still reflects deals made prior to the integration, which we call the legacy portfolio. From this integration, GSBD has directly benefited through a deeper origination funnel and the ability to invest in and frequently lead larger senior secured debt transactions supported by the platform's disciplined approach. We have approximately 250 investment professionals on our broader private credit platform. The scale of our investing team, the scale of our platform and the incumbency, relationships and investment prowess. Our team has built up over nearly 30 years, stacks up well against industry peers. What makes it more powerful and unique is having a private credit business attached to the #1 global investment bank.

In addition to the deal origination through our dedicated private credit team, we are able to draw on the relationships of more than 3,000 investment bankers, helping us identify potentially attractive opportunities from our #1 M&A franchise which we can select from as a fiduciary to investors subject to regulatory requirements. Before I dive into our view on the market, I'd like to highlight some broader stats that illustrate the progress GSBD has made as we continue to transition to the direct lending platform. The median EBITDA of the portfolio has increased 84% and from year-end 2021 to $71.8 million at year-end 2025. Our exposure to first lien investments increased to 97% of the portfolio from 89% during that same period. Throughout 2025, GSBD demonstrated continued progress in addressing credit quality concerns and active management of the portfolio.

PIK as a percentage of total investment income was 9% in Q4 2025, which is down from 15.3% in Q4 2024. Of that 9% during the fourth quarter, 5% of total investment income during the quarter was from PIK that was introduced as a loan modification or amendment after the initial agreement the vast majority of which relates to the legacy portfolio. Our investments on nonaccrual decreased slightly to 1.9% of fair value from 2% during the year. This is well below our highest nonaccrual rate since integration of 3.4% of fair value. Another topical consideration we've been keen to address is our exposure to annualized recurring revenue or ARR loans within our broader BDC complex, which includes GSBD. From its peak of 36.5% during Q3 2022, we have significantly reduced the ARR exposure within the BDC complex to approximately 5% at year-end 2025.

Within GSBD specifically, ARR loans came down from nearly 39% of the portfolio on a fair value basis to 11% during that same time period. This trend is attributed to our strategic focus on EBITDA-based investments since integration and our proactive approach in mitigating ARR loans from the legacy portfolio as we seek strategic exits or EBITDA conversions for the existing loans in the space. Overall, our direct lending platform had another strong year in 2025, which directly benefited GSBD. For the year in the Americas specifically, we committed a total of approximately $14.6 billion, which was larger than the $13 billion committed during 2024 and more than double the activity in 2023 and all the while remaining selective and disciplined in our underwriting approach. From a macro perspective, despite a volatile first half of 2025, total M&A volume globally throughout the year was up 44% from 2024.

The U.S. private equity deals reached nearly $1.2 trillion, marking the second time in history that deal volume has surpassed $1 trillion. Despite this being driven largely by mega deals exceeding $1 billion, we expect this M&A momentum in a potentially falling rate environment to continue and spur the resumption of private equity activity. The more favorable M&A environment should stimulate greater demand for credit financing. And despite the supply of credit remaining robust, we do anticipate spreads to moderately widen during the market dynamics we've seen over the past month. We believe that in today's market environment, differentiation among managers will increasingly be driven by sourcing quality, underwriting discipline, collateral oversight and creditor protections.

Let's get to the topic of software. We have a very experienced software investing team. Our view informed by extensive collaboration across Goldman Sachs, including our 13,000 software engineers, our technology investment banking team and our growth equity investors or early the companies like Anthropic is that AI's impact will be highly company-specific and nuanced. We will come back to the topic of software and go through some more detail on our framework and a case study but our broader private credit platform has operated with an incredibly high bar focusing on what we believe are high-quality situations in our very broad funnel. As it relates to the recent headlines in software, and the volatility we've seen in equity markets, we understand the concerns regarding AI's potential impact on certain software business models.

However, as credit investors position at the top of the capital structure, our lens is fundamentally different from, say, equity investors. We don't participate in growth or equity valuation upside. We're focused on the durability of assets and their cash flows. This credit-focused perspective provides some insulation from valuation volatility. That said, we recognize that sufficiently severe disruption could impact creditworthiness which is why we maintain ongoing vigilance and are prepared to adapt if our thesis on any portfolio company changes materially. We are focused on lending to scaled incumbent businesses that are deeply entrenched in mission-critical workflows and complex use cases evidenced by strong retention and efficient growth. These structural features, among other things, are key characteristics that we seek in software companies that demonstrate real incumbency advantages.

Our direct lending platform has a long history of investing in the software sector with investments in the sector dating back to 2008 when we launched our first senior direct lending fund. We have been proactively assessing the impacts of AI on the software space for years. We passed on our first deal due to AI concerns in October of 2023, and rolled out an internal framework to evaluate AI disruption risk in early 2025, which is incorporated into all new investments in addition to our ongoing monitoring of existing portfolio exposure. The characteristics of our framework include, but are not limited to, acting as mission-critical systems of record with proprietary data and deep domain expertise solving for complex use cases and deterministic outcomes with no tolerance for errors.

Leveraging the accumulation of context, deep understanding of customers' unique requirements to drive critical business processes providing broad platforms versus single-product tools, operating on modern underlying architecture with limited technical debt, actively innovating and embedding AI into their own products, operating in regulated and risk-averse industries with long-term customer relationships and trust as well as having proven track records of managing security, compliance, regulatory and governance complexities.

We look at each opportunity through this lens in the underwriting process. Across our broader direct lending Americas platform, we have closed or committed to '26 new software deals since January 2025 that exhibit strong KPIs including an average rule of 40 of 55.8%, comprised of 16.6% recurring revenue growth and 39.1% cash EBITDA margins. During the third quarter 2025, revenue growth and EBITDA margins of our Direct Lending Americas software portfolio improved to 9.2% and 34.9%, respectively, up from 7.8% and 30.3% a year earlier, respectively. Let me provide a concrete example of how we leverage the Goldman Sachs ecosystem for both proprietary origination and enhanced diligence by discussing our largest committed software deal during the quarter, Clearwater Analytics. Clearwater Analytics founded in 2004 in base in Boise, Idaho, provides cloud native investment accounting, analytics and reporting solutions for institutional investors, including insurance companies.

Goldman Sachs has been around this company for a very long time. We were approached by the sponsors looking to take Clearwater Private as the only organization that we believe could have provided a 100% solution on the transaction of this size in both public and private markets in addition to offering M&A advice. We showed the sponsor's indicative financing terms across both markets and ultimately, the sponsor selected the private credit alternative where we were able to structure and negotiate a mutually beneficial bilateral credit facility that included our desired long-term size allocation. The bilateral process, both simplified and streamlined the sponsor's financing process while protecting the confidentiality of the M&A process which was critically important for the M&A execution. This is an example of leveraging the broader GS ecosystem to deliver differentiated origination and outcomes for our investors.

The other part of the ecosystem relates to diligence in our AI framework. The deal team benefited from a first-hand perspective on Clearwater's capabilities and value proposition with Goldman Sachs being a customer of Clearwater's across our Asset & Wealth Management and Global Banking and Markets divisions. The deal team was able to conduct multiple calls with our engineering colleagues to validate our credit thesis and build a high degree of conviction related to the mission criticality and stickiness of the solution and competitive positioning and durability in a rapidly evolving technology landscape. And so in December 2025, the GS private credit complex committed to 100% of a $3.5 billion investment in a new unitranche financing to support the take private of Clearwater by Warburg Pincus and Permira, and a few weeks later, the sponsors brought 9 other lenders into the deal.

The Goldman Sachs private credit complex retained our desired $1.235 billion in the facility, and the GS BDC will own $75 million of that at closing. The Clearwater investment highlights key characteristics that underscore our approach to investing in software amidst an evolving and nuanced investing environment. Clearwater's advantages are not about the cost to write code. They're about owning the customer relationship, leveraging proprietary data with network effects, navigating regulatory complexity, and providing the insurance policy that mission-critical systems will work reliably. These structural and strategic advantages enable Clearwater to continue providing value to its customers and benefit from AI advancements rather than be disrupted by them.

Looking forward, our framework will continue to evolve as the landscape develops. While AI remains a dynamic and rapidly evolving area, we remain confident in our ability to thoughtfully assess and help mitigate AI-related risks across both our current portfolio and new investment opportunities. That said, and this is important, this is not a time for complacency but rather the time to remain humble, proactive, disciplined and forward-looking. We are focused on the implications of AI, not only within software, but across the broader business landscape and we continue to leverage the differentiated capabilities of the Goldman Sachs ecosystem in support of our portfolio.

With that, let me turn it over to my co-CEO, David.

Thanks, Vivek. I'd now like to turn to our fourth quarter results. Our net investment income per share for the quarter was $0.37, and net asset value per share was $12.64 as of quarter end. This decrease of approximately 1% relative to third quarter NAV was largely due to net realized and unrealized losses in the quarter. The Board declared a fourth quarter 2025 supplemental dividend of $0.03 per share payable on or about March 20, 2026, to shareholders of record as of March 9, 2026. Adjusted for the impact of the supplemental dividend related to the fourth quarter earnings.

The company's fourth quarter 2025 adjusted NAV per share is $2.61. The Board also declared a first quarter 2026 base dividend per share of $0.32 to shareholders of record as of March 31, 2026. We ended the quarter with a net debt-to-equity ratio of 1.27x as of December 31, 2025, and as compared to 1.17x as of September 30, 2025. GSBD committed approximately $1.2 billion in new commitments throughout the year and 35 new deals. Of the commitments made to new portfolio companies, GS played a lead role in approximately 75% of the deals. During the quarter, we made new commitments of approximately $394.9 million across 27 portfolio companies comprised of 7 new and 20 existing portfolio companies. 100% of our origination during the quarter were in first lien loans, which continues to reflect our bias and primarily maintaining exposure to investments that are at the top of the capital structure.

During the quarter, in addition to Clearwater, we also acted a sole lead arranger in the acquisition of QU, which is an e-commerce native apparel and accessory brand focused on outdoor enthusiasts. This transaction exemplified our ability to lean into a high-quality company and commit 100% of the financing, which is an illustration of the platform's deep sponsor relationships.

Turning to portfolio composition. As of December 31, 2025, total investments in our portfolio were $3.26 billion at fair value, comprised of 38.4% in senior secured loans, 1.3% in a combination of preferred and common stock and a negligible amount of warrants.

With that, let me turn it over to Tucker to discuss repayments fundamentals and credit quality.

Thanks, David. I'll first discuss the portfolio in more detail. At the end of the fourth quarter, the company held investments in 171 portfolio companies operating across 40 different industries. The weighted average yield of our total debt and income-producing investments at amortized cost at the end of the fourth quarter was 9.9% as compared to 10.3% at the end of the third quarter. Importantly, our portfolio companies continue to have both top line growth and EBITDA growth quarter-over-quarter and year-over-year on a weighted average basis.

The weighted average net debt-to-EBITDA of the companies in our investment portfolio increased slightly to 5.9x during the fourth quarter compared to 5.8x during the third quarter. At the same time, the current weighted average interest coverage of the companies in our investment portfolio at the end of the fourth quarter increased to 2x compared to 1.9x during the third quarter. As Vivek and David mentioned, we had a strong quarter of originations with an increase in our net funding as we continue to enhance the portfolio. Sales and repayment activity totaled $251.6 million during the quarter, primarily driven by full repayment and exit of 13 portfolio companies. One notable exit this quarter was with a portfolio company that our platform has been invested in for approximately 8 years. This company is a software provider for the staffing, recruitment and contingent labor industry.

Now despite performance remaining steady and showing no indication of deterioration in the near or long term, we decided to sell the loan at $0.99 to other lenders, given anticipated headwinds in AI disruption risk within the industry. This is a strong example of our ability to be proactive and cautious towards exiting strong companies that we believe have potential AI risk. Our total repayments during 2025 amounted to $1.1 billion, over 78% of this repayment activity was from pre-2022 vintage loans, demonstrating effective management of our assets. As of December 31, 2025, pre-2022 vintage investments constitute approximately 43% of GSBD's portfolio at fair market value. The firm maintains a proactive approach to monitoring, managing and resolving any associated credit issues.

Throughout this past quarter, we utilized our 10b5-1 stock repurchase plan. We repurchased north of 1.5 million shares for $15 million, which is accretive to NAV by $0.04 per share. Since implementing the 10b5-1 plan in June 2025, we have repurchased $52.2 million or 4.7 million shares. And finally, turning to asset quality. As of December 31, 2025, we placed Pluralsight's first lien/senior secured debt position last out position on nonaccrual status. Investments on nonaccrual status increased slightly to 2.8% and 1.9% of the total investment portfolio at amortized cost and fair value from 2.5% and 1.5% as of September 30 and 2025.

I will now turn the call over to Stan to walk through our financial results.

Thank you, Tucker. We ended the fourth quarter of 2025 with total portfolio investments at fair value of $3.3 billion outstanding debt of $1.9 billion and net assets of $1.4 billion. As David mentioned, our ending net debt to equity ratio as of the end of the fourth quarter was 1.27x. At quarter end, approximately 69% of our total principal amount of debt outstanding was an unsecured debt.

As of December 31, 2025, and the company had approximately $1.1 billion of borrowing capacity remaining under the revolving credit facility. Subsequent to quarter end, on January 15, 2026. We borrowed $505 million under the revolving credit facility and used the proceeds together with cash on hand to repay the 2026 notes plus accrued and unpaid interest in full satisfaction of our obligations under the notes. Also subsequent to quarter end, on January 28, 2026, we issued $400 million of 3-year investment-grade unsecured notes with a coupon of 5.1%. We also hedged the issuance by swapping the coupon from fixed to floating to match GSBD's floating rate investments. Over 100 investors participated in the company's day of live deal marketing which resulted in the peak order book being 7.3x oversubscribed on our $300 million starting size.

Before continuing to the income statement, as a reminder, in addition to GAAP financial measures, we also reference certain non-GAAP or adjusted measures. This is intended to make our results easier to compare to results prior to our October 2020 merger with Goldman Sachs Middle Market Lending Corp., or MMLC. These non-GAAP measures remove the purchase discount amortization impact from our financial results. For the fourth quarter, GAAP and adjusted after-tax net investment income was $42.2 million and $41.8 million, respectively, as compared to $45.3 million and $44.8 million, respectively, in the prior quarter. On a per share basis, GAAP net investment income was $0.37, equating to an annualized net investment income yield on book value of 11.7%.

Total investment income for the 3 months ended December 31, 2025, and September 30, 2025, was $86.1 million and $91.6 million, respectively. Our undistributed taxable income as of 12/31/2025 is approximately $109 million or $0.97 on a per share basis.

With that, I'll turn it back to Vivek for closing remarks.

Thanks, Dan, and thanks, everyone, for joining our earnings call. We are excited to continue turning over the portfolio into new attractive opportunities using the full breadth of the Goldman Sachs platform while continuing to navigate through this market environment with humility and continued heightened discipline. With that, let's open the line for Q&A.

[Operator Instructions] We will go first to Finian O'Shea with Wells Fargo.

I wanted to ask about Clearwater at all, real interesting color from the -- more from the bank platform perspective than software. So when we see -- it sounds like we had an advantage position there through Goldman. But can you give us a sense of the -- like in a plus 450 type situation where those are all -- those are the sort of big clean names we see those to me from the outside look like they're not too much of a premium to BSL or the bank solution on a true like leverage-adjusted basis. So how was that true like market competitive? Or did you lean in sort of one way or the other on say, leverage risk or like quality price on the low end I guess if I'm wearing that right, just how distinct was your sort of angle in your underwriting? .

Thanks for the question. Look, I think it's a really good question, and I think this is a really good example, particularly the M&A kind of cycle kind of starts to pick up, which is, to your point, one of the things we do benefit from is in addition to the origination that our team provides, we do -- we are kind of connected to #1 M&A investment bank. And so we see interesting opportunities that way. These take privates are particularly interesting because generally speaking, the most important thing in a take private is to keep the deal confidential. And so our ability to provide 100% solution helps the sponsor by [indiscernible] leak risk. And so then we can have a bilateral conversation.

I would just say, and I don't think we get into this name by name in terms of the specifics from a disclosure perspective. But you should assume that when we provide certainty like that, in an M&A context on a bilateral basis, we're providing value to the client by giving them 100% solution and very seamless execution while they're kind of focusing on their much bigger picture of the M&A that we get paid incremental economics for that. And so these M&A situations, if you take privates in particular, we think are real sources for alpha because when we can kind of bilaterally negotiate a document with sponsors that are kind of really mutually beneficial where we can really kind of solve for what's important for each other that tends to be a better dialogue and a better outcome than when you're kind of in a competitive process, kind of needing to play the game theory of how to kind of lean in vis-a-vis competition.

I appreciate that. And I guess, name specific, that's very helpful. And sort of as a follow-up, I'll give you in the team a plug for the shareholder letter on semi liquids not having studied the -- your nontraded semi-liquid as much. Just curious if there is a different structure that administers the sort of safe laws in semi-liquid and Evergreen altogether or if it's just a matter of better education as other prominent voices have been seeing as well? I appreciate that.

Thank you, and thanks for the feedback on the letter. We appreciate that. The first thing I'd say, and I think this is really important, is we don't have different standards for different vehicles or different types of investors. We have a single process that goes to a single investment committee, and that's a very robust process in a high bar. And so a deal needs to meet that high bar to go into our platform. And then once it's in our platform, we kind of allocated proportionately based on the kind of criteria of the different vehicles on a formulaic basis. So there's no kind of -- this kind of good deal go to hear, other deals go like there's none of that, like everyone kind of shares in this.

The second point I'll make is from a fee standpoint, and this goes back to your question on Clearwater. Any economics that we make on these deals get passed through to the LPs in the vehicles directly. So they completely benefit on a prorated basis from kind of any value or economics that the platform is able to create. And so I think that's also important and quite valuable. Look, the other thing, and as you said, we spent time on this kind of in the letter. So we don't use the word semi-liquid. We understand what people mean when they use that phrase. But I think it's really -- I think the thing you have to think about is the actual liquidity provisions in these vehicles are more nuanced than that. And so when we sit down with clients to kind of talk about our nontraded BDC.

We make sure that we kind of go through and they understand exactly how it works and understand that part of the proposition is these are illiquid assets. And part of the premium that you're getting in private credit versus public credit is for that illiquidity. Now relative to a drawdown fund, there are some liquidity mechanisms that have nuance to them in terms of redemption repurchase caps and certain types of vehicles, the manager also as the Board has the right to actually gate. So there's like provisions to it. And so at the end of the day, we want people who understand what they're getting into, who are thinking about that holistically in the context of the portfolio construction so that they're kind of only allocating the part of their portfolio where they want this extra spread, they understand the trade-off and the liquidity.

And so they're allocating a portion of that portfolio where they don't kind of need that liquidity for an extended period of time. And then the second thing that I think is really important is we've been very intentional in the way that we've kind of sized our vehicle. So the vast majority of our capital is draw down capital. And obviously, it's easier to modulate as a platform when your evergreen money is only a minority of your capital. You don't have deployment pressure. I think one of the risks that one runs if they allow that kind of retail component to get too big is this a risk that it starts to kind of impact credit selection. And one of the things that we want to make sure that we're always doing is as a platform that's been in this business for 30 years, we want to make sure that we're investors, not asset gatherers, not deployers. And so yes, that has an impact on growth.

Obviously, it's easier to scale faster if you're kind of going all in on the retail channel. But we think with a more measured approach, we're in a really, really good position to kind of just navigate cycles. And so we saw, as it says in the letter, we saw some -- we saw inflows kind of reduce a little bit in the fourth quarter. We saw kind of redemption activity kind of pick up. Again, our metrics were quite favorable to what we saw in the industry. But we think that by having diversified sources of funding, you'll be in a position where you can kind of deploy capital kind of through the cycle and put yourself in the best position to try to generate the best risk-adjusted returns for clients.

Good stuff. I'll do one follow dividend. You guys have historically been front-footed about that. Incentive fee adjusted SOFR look through adjusted, you look a little bit below any sort of updated views on how you're thinking about the 32 base?

We feel pretty good about -- we reset that last year with the curve and everything in mind. The other thing I would say is we're somewhat optimistic that we see some spread widening here. It's early days yet. I think a lot of people are still on price discovery. We're seeing anywhere from 25 to 50 basis points in both coupon as well as OID. So roll out through the model, we feel very comfortable with the dividend as it sets today.

We'll go next to Heli Sheth with Raymond James.

So I believe you mentioned that spillover at $0.97 a share, and that's kind of starting to approach or it's over actually 3/4 of the base dividend. Is there any strategy there looking forward, how we should think about deployment of that spillover heading into 2026? And will it be used to cover any shortfall of earnings?

Yes. So in terms of the spillover, that's come down year-over-year. We had done with the restructure of our dividend structure into basin supplemental structure earlier in 2025, we utilized a certain portion of that spillover. To the extent that we would need to, we could issue a special distribution. We don't have any current plans for that right now. And as a result of our supplemental distributions, we could also issue some -- or we could also distribute some incremental NII.

Got it. And as a quick follow-up, as originations and repayments remain kind of elevated in this environment, are you seeing any sort of shift in the mix of the deals that you're seeing in the pipeline, whether it be in terms of sponsor and nonsponsor incumbent versus new borrowers, LTVs?

No, I wouldn't say the composition of the deal flows changing. I would say that there continues to be signs that kind of M&A activity is sort of picking up, obviously, not in software just given what's happened kind of in public markets and around software. But I'd say in other parts of the -- kind of in other industries, we are kind of seeing more dialogue, and we'll see where that dialogue goes.

We'll go next to Ethan Kaye with Lucid Capital Markets.

I appreciate the general color on software. You did mention you rolled out this AI kind of risk framework in the beginning of 2025. But that being said, it sounds like you were kind of cognizant of some of the risks, cognizant of the emerging risk prior to that, but maybe formalized in 2025. But I guess I'm curious, when you apply that framework to the current portfolio, do you find any names that maybe kind of wouldn't have passed muster had they been underwritten while that framework was in place?

Yes. No, thanks for the question, Ethan. As you said, we turned our first deal down for AI in 2023. So we've been aware of this for a long time. we did formalize our AI framework in early 2025 and put it through. And look, the majority of the portfolio stacks up pretty well. There are a few legacy assets that certainly would be -- fit some of those weaker metrics and they would be more point solutions. I think you've seen some of those be marked down in the book to date, and we're continuing to work on those exit those.

The other thing I would say is, as we pointed out in the script, we're very proactive on account management here. One of those names, for example, that was on the weaker side of that AI framework, we sold. So we sold it at $0.99 to other lenders that didn't have the same viewpoint. So we're being very proactive with it and watching those names carefully. But by and large, we feel pretty good about the software portfolio. The other thing I would point out is, if you take a look at our software portfolio in general in GSBD, the performance is strong. They had -- revenue growth is about 10.3% year-over-year and margins expand by about 5 points to 34.3%, which is stronger metrics in the overall portfolio. So we feel pretty good about that.

Great. I appreciate that color. I guess on repurchases. So you guys have prudently been kind of buying back shares here. You mentioned you repurchased over $50 million under the current authorization, which I believe is $75 million through June. And I know it's formulaic, but given what you know about the inputs in the underlying formula wondering kind of whether you anticipate that full utilization of that $75 million by exploration and then whether you would explore kind of a new authorization in the second half of '26?

Sure. Thank you for the question. So one of the inputs into -- as you mentioned, it is formulaic, so that it can operate at any time. One of the inputs into that formula is our net debt-to-equity ratio. And so that ticked up period-over-period. It's right around our target. And so that is one of the limiting factors in us buying back. I think we will continue to assess the ability to utilize that program in the future. As you mentioned, we still have approximately $23 million of room within that program. We've been taking a measured approach to issuing that. But it's also going to depend on the other opportunities we see in the market and where spreads go.

This concludes the question-and-answer session. At this time, we will turn the call over to Vivek for any closing remarks.

Thanks, everyone, for the time today. We really appreciate the continued engagement and look forward to continuing the dialogue. Let us know if you have any more questions, and have a great rest of the day.

Good morning. This is John Silas, a member of the Investor Relations team for Goldman Sachs BDC, Inc. I would like to welcome everyone to the Goldman Sachs BDC, Inc. Third Quarter 2025 Earnings Conference Call.

[Operator Instructions] Before we begin today's call, I would like to remind our listeners that today's remarks may include forward-looking statements. These statements represent the company's belief regarding future events that, by their nature, are uncertain and outside of the company's control. The company's actual results and financial condition may differ possibly materially from what is indicated in those forward-looking statements as a result of a number of factors, including those described from time to time in the company's SEC filings.

This audiocast is copyrighted material of Goldman Sachs BDC, Inc. and may not be duplicated, reproduced or rebroadcasted without our consent.

Yesterday, after the market closed, the company issued an earnings press release and posted a supplemental earnings presentation, both of which can be found on the homepage of our website at www.goldmansachsbdc.com, under the Investor Resources section and which includes reconciliations of non-GAAP measures to the most directly comparable GAAP measures. These documents should be reviewed in conjunction with the company's quarterly report on Form 10-Q filed yesterday with the SEC.

This conference call is being recorded today, Friday, November 7, 2025 for replay purposes.

I will now hand over the call to Vivek Bantwal, Co-CEO of Goldman Sachs BDC, Inc.

Thank you, John. We will begin the call with our perspective on recent performance in light of a gradually improving macro environment. Next, we will discuss our investing activity and outline GSBD's positioning heading into the fourth quarter. Shortly after, David Miller and Tucker Greene will provide a detailed review of portfolio activity and performance before handing it over to Stan Matuszewski to take us through the financial results. We will conclude by opening the line for Q&A.

The M&A market has continued to remain resilient despite uncertainty that persisted in the first half of the year as total M&A dollar volumes in Q3 2025 were 40.9% higher year-over-year compared to Q3 2024. This surge is attributed mainly to a renewed risk-on sentiment among investors, lower borrowing costs, greater market clarity and a reset on valuation expectations between buyers and sellers in the market. As David will discuss later in the call, this pickup in activity has directly benefited GSBD as our new investment commitments and repayments during the quarter reached the highest level since the integration of the platform in 2022. Recent base rate cuts with additional expected through year-end into 2026 should accelerate deal activity, albeit spreads remain tight across the middle market and large cap juxtaposed against a tight spread environment in the public markets.

Our proactive decision earlier this year to adjust our dividend policy and cut the base dividend positions us well in what will be a lower yield environment, where emphasis on credit selection will be paramount. Additionally, during times of increased competition for deal flow and high-quality deals, our proximity to our investment banking franchise serves as a competitive advantage for our platform to remain highly selective in evaluating opportunities. Broader credit dynamics remain top of mind for investors and made recent headlines concerning what we believe to be idiosyncratic issues versus a broader systematic concern. We remain comfortable with the risk dynamics in the private credit space given the overall health of portfolio fundamentals. We continue to evaluate the impacts of tariffs, ability for companies to service debt, and risks involved with software investing, particularly with the recent growth of AI investing.

We recognize the transformative potential of AI, but our primary focus remains on downside risk mitigation. We have developed a proprietary framework to assess both software and AI disruption risk that we had implemented in our underwriting for over 2 years. We remain focused on mission-critical, market-leading companies with core systems of record across all our software deals.

Now turning to our third quarter results. Our net income -- our net investment income per share for the quarter was $0.40 and net asset value per share was $12.75 as of quarter end, a decrease of 2.1% relative to the second quarter NAV, which was partially due to the $0.16 per share special dividend with some markdowns to previously underperforming names. This quarter marks the last of 3 special dividends that were announced earlier this year, along with changes to our dividend policy. The Board declared a third quarter 2025 supplemental dividend of $0.04 per share payable on or about December 15, 2025, to shareholders of record as of November 28, 2025. Adjusted for the impact of the supplemental dividend related to the third quarter's earnings, the company's third quarter adjusted NAV per share is $12.71 which I would note is a non-GAAP financial measure introduced as a result of the dividend policy change.

The Board also declared a fourth quarter base dividend per share of $0.32 to shareholders of record as of December 31, 2025. We ended the quarter with a net debt-to-equity ratio of 1.17x as of September 30, 2025, as compared to 1.12x as of June 30, 2025.

With that, let me turn it over to my co-CEO, David.

Thanks, Vivek. During the quarter, we made new investment commitments of approximately $470.6 million across 27 portfolio companies, comprised of 13 new and 14 existing portfolio companies. This marks the highest level of new investment commitments since Q4 of 2021, which demonstrates our unique position in a competitive deal environment, where we can be selective on credit quality and exhibit discipline where we want to lean in. 100% of our originations during the quarter were in first lien loans, reflecting our continued bias in maintaining exposure to the top of the capital structure.

Of the 13 new portfolio companies, we served as lead on 7 which is a tangible indication of the power of the GS platform. The impact of the GS franchise was on full display through our financing of the acquisition of Shields Health Solutions. This was part of the broader take private of Walgreens, of which 4 silos were financed uniquely with GS Private Credit participating only in the Shields transaction. This is a deal where investment banking colleagues advise the sponsor. Shields Health Solutions is one of the largest specialty pharmacy operators in the U.S. At the time of the investment, the transaction represented one of the largest take privates of all time. Another notable investment this past quarter was to support Newtek Merchant Solutions, a wholly owned subsidiary of the publicly traded bank holding company, Newtek, which offers a range of financial service products to small and medium-sized businesses.

Our financing package was used to support the refinancing of existing debt and to fund a payment to increase the bank holding capital base. Due to continued relationship with the CEO, GS Private Credit was able to secure the role of admin agent and sole lender to the company. The integration of our platform in 2022 allowed us to evaluate and invest in more high-quality opportunities that span from the middle market to large cap. And these 2 examples shine a light on our continued ability to do so at attractive pricing. We believe our platform is well positioned by the unique opportunities that channels Goldman Sachs ecosystem to take advantage of an active environment.

With that, let me turn it over to our President and Chief Operating Officer, Tucker to discuss portfolio repayments fundamentals and credit quality.

Thanks, David. For our portfolio companies as of September 30, 2025, total investments at fair value were $3.2 billion, comprising of 98.2% in senior secured loans, 1.5% in a combination of preferred and common stock and a negligible amount in warrants. We continue to see increased repayment activity with $374.4 million for the quarter. 86% of these repayments in the quarter were from pre-2022 investments, leaving less than 50% of our current portfolio at fair value and legacy assets. This rotation remains a key focus for the GSBD portfolio as it recycles into new credits.

One notable payoff during the quarter was total vision. GS first invested in the company in 2021 and finance an acquisition in 2022. Total Vision owns and operates optometry practices across California, which provide professional and retail services to patients. We received full repayment of the credit facility and equity co-investment. This illustrates the power of our platform and our team's enhanced management capabilities in the health care space. Throughout this past quarter, we utilized our 10b5-1 stock repurchase plan during the quarter. We repurchased north of 2.1 million shares for $25.1 million, which was NAV accretive.

At the end of the quarter, total investments at fair value and unfunded commitments in our portfolio were $3.8 billion in 171 portfolio companies operating across 40 different industries. The weighted average yield of our debt and income-producing investments at amortized cost at the end of the third quarter was 10.3% as compared to 10.7% at the end of the second quarter. Despite a modest tightening in portfolio yield quarter-over-quarter, our portfolio companies have both top line growth and EBITDA growth quarter-over-quarter and year-over-year on a weighted average basis. Our weighted average net debt to EBITDA remained flat quarter-over-quarter at 5.8x, and our interest coverage increased quarter-over-quarter at 1.9x from 1.8x.

As of September 30, 2025, we placed one position from an existing portfolio company on nonaccrual status. However, our overall investments on nonaccrual status decreased to 1.5% of fair value from 1.6% as of the end of the second quarter.

I will now turn the call over to Stan to walk through our financial results.

Thank you, Tucker. We ended the third quarter of 2025 with total portfolio investments at fair value and commitments of $3.8 billion, outstanding debt of $1.8 billion and net assets of $1.5 billion. Our ending net debt to equity ratio at the end of the third quarter was 1.17x, which continues to be below our target leverage of 1.25x. At quarter end, approximately 70% of our total principal amount of debt outstanding was in unsecured debt. As of September 30, 2025, the company had approximately $1.143 billion of borrowing capacity remaining under the revolving credit facility. Given the tightening of credit spreads we've observed in the market, we continue to look for ways to optimize the pricing of our financing sources.

During the quarter, we issued $400 million of a 5-year investment grade unsecured note with a coupon of 5.65%. We also hedged the issuance by swapping the coupon from fixed to floating to match GSBD's floating rate investments. Over 50 investors participated in the company's day of live marketing, which resulted in the peak order book being 4x oversubscribed.

Before continuing to the income statement, as a reminder, in addition to GAAP financial measures, we also reference certain non-GAAP or adjusted measures. This is intended to make our financial results easier to compare to results prior to our October 2020 merger with Goldman Sachs Middle Market Lending Corp., or MMLC. These non-GAAP measures remove the purchase discount amortization impact from our financial results. For the third quarter, GAAP and adjusted after-tax net investment income was $45.3 million and $44.8 million, respectively, as compared to $44.5 million and $43.5 million, respectively, in the prior quarter. On a per share basis, GAAP net investment income was $0.40.

Adjusted net investment income for the quarter in connection with the merger with MMLC was unchanged at $0.40 per share, equating to an annualized net investment income yield on book value of 12.5%. Total investment income for the 3 months ended September 30, 2025, and June 30, 2025, was $91.6 million and $91 million, respectively. We observed PIK as a percent of total investment income decreased marginally to 8.2% for the third quarter from 8.3% in the second quarter of 2025.

With that, I'll turn it back to David for closing remarks.

Thanks, Stan, and thanks, everyone, for joining our earnings call. Although the perception of risk embedded within the credit market has changed, we continue to apply our staunch underwriting philosophy and remain focused around the maintenance of our dividend that we proactively addressed. In light of a lower-yielding environment, we believe fund managers will be rewarded for their credit selection.

With that, let's open the line for Q&A.

[Operator Instructions] We'll go first to Arren Cyganovich with Truist Securities.

In your comments, you had mentioned that the M&A activity to a level that you had not seen for a few years. Maybe you could just talk to us about your thoughts about sustaining into next year and whether or not this is kind of more of a shorter term or maybe start of a longer-term trend here?

Thank you for the question. Yes. Listen, we think this is the start of a longer-term trend. This was, in our minds, really a question of when, not, if. Because when you look at a, the sort of cumulate amount of sort of dry powder in the private equity community, and you juxtapose that with the capital that's invested in existing investments that have now been kind of sort of in portfolio for a period of time. And then you think about the fact that these more recent private equity vintages from a DPI perspective is really behind historical vintages. And so there's kind of a growing kind of need for private equity firms to, a, exit existing portfolios; and then b, given the dry powder sort of investing in new portfolios.

So when you sort of look at all of those metrics it speaks to the need for kind of more M&A on the forward. The question then became sort of when. We started to see some signs that early this year, obviously, as you kind of got into April, there was sort of a pullback as you saw kind of broader volatility and focus on tariffs and the like. And what we've seen more recently is really kind of back to that risk-on sentiment where people are looking to kind of do things strategically. And so we're seeing that in the sponsor community, but we're also seeing that in the corporate community in terms of M&A activity. And so we think we're in the early stages of that, and we think that as we get into 2026, we'll see more of that.

Okay. And I guess with -- how much of the increase in activity, would you have to see for spreads maybe to start to widen out a little bit, basically with supply -- enough supply essentially to offset some of the high demand?

Look, that's a little hard question to say. We're not really anticipating spreads to widen much. We're hopeful that, that might happen with the pick up M&A. But given the dry powder, we're not planning on that in the near term. I think what we like about our platform as we continue to see a bunch of just unique originations that we can get higher spreads because of that unique origination platform that being tied to Goldman Sachs. But your regular way A+ credit, we don't think it's going to have meaningful spread widening anytime soon.

And then on credit, you had one new investment on nonaccrual at Dental Brands. I think that's been kind of a watch list for a bit. Is -- maybe you just talk a little bit about the performance there and nonaccruals were relatively stable, and you had some unrealized and realized losses in the quarter. Were there any impacts from some of your prior nonaccruals in there?

Look, I mean, as you mentioned, this has been in the portfolio for some time. We have had some more junior securities that were already risk rated 4 as a result of underperformance in a previous restructuring. The company continues to underperform our expectations. So we put a more senior tranche on nonaccrual now. So it's not a new name. It's been risk rated 4 for some time. But the good news is this is a tiny position in this fund. I think it's sub $800,000 of exposure.

So it doesn't meaningfully move the needle for us from an overall nonaccruals. And as Tucker mentioned in his prepared comments, it did tick down slightly from 1.6% to 1.5% as a percentage of fair value. So we feel overall portfolio quality has been stable where we've seen continued write-downs is on the more legacy names where we're not seeing a big turnaround. So we took additional markdowns there on those names. But other than outside of those legacy names, we feel pretty good about the portfolio.

[Operator Instructions] The question-and-answer portion has concluded. I would now like to turn the call back over to Vivek for any closing comments.

Thanks, everyone, for their time this morning. And if more questions come up, feel free to contact our team. Thank you, everyone, and have a great weekend.