Here are 1-3 brief analogies for Gladstone Capital (GLAD):

• It's like a publicly traded KKR or Blackstone, but for small to medium-sized private companies.
• Think of it as a Fidelity or Vanguard fund that invests in loans and equity stakes of private American businesses instead of public stocks or bonds.

• Debt Investments: Gladstone Capital provides various forms of debt financing to companies, including senior term loans, revolving loans, secured first and second lien term loans, senior subordinated loans, unitranche loans, junior subordinated loans, and mezzanine loans.
• Equity Investments: Gladstone Capital also offers direct equity financing through common stock, preferred stock, limited liability company interests, or warrants.

Gladstone Capital Corporation (GLAD) operates as a business development company (BDC). Its "customers" are the small and medium-sized companies to which it provides debt and equity financing. These are typically private companies, and the provided background does not list specific names of these portfolio companies.

Instead, the company description indicates that Gladstone Capital targets:

• Small and medium-sized companies in the United States.
• Companies with sales between $20 million and $150 million and EBITDA between $3 million and $25 million.
• Companies across various industries, including business services, light and specialty manufacturing, niche industrial products and services, specialty consumer products and services, energy services, transportation and logistics, healthcare and education services, specialty chemicals, media and communications, and aerospace and defense.

Therefore, Gladstone Capital's major customers are its portfolio of numerous private small and medium-sized businesses across diverse sectors. Specific customer names are not listed in the provided background as they are private entities within GLAD's investment portfolio.

Gladstone Management Corporation (private company)

David Gladstone Chairman and Chief Executive Officer

Mr. Gladstone is the Founder of Gladstone Capital Corporation, serving as Chief Executive Officer and Chairman of the Board since its inception in 2003. He also founded and continues to serve as Chief Executive Officer and Chairman of the board of directors for various affiliates, including Gladstone Investment Corporation and Gladstone Land Corporation. Prior to founding the Gladstone Companies, he served as Chairman or Vice Chairman of American Capital, Ltd., a publicly-traded leveraged buyout fund and mezzanine debt finance company, from 1997 to 2001. From 1974 to 1997, Mr. Gladstone held various leadership positions, including Chairman and Chief Executive Officer, with Allied Capital Corporation and its affiliates, which were described as the largest group of publicly-traded mezzanine debt funds in the United States. He managed the growth of Allied Capital Commercial, a publicly-traded REIT, from no assets at its initial public offering to $385 million at the time it merged into Allied Capital Corporation in 1997. Mr. Gladstone also founded and was the Managing Member of The Capital Investors, LLC, a group of angel investors.

Nicole Schaltenbrand Chief Financial Officer and Treasurer

Ms. Schaltenbrand joined Gladstone in November 2015. Before joining Gladstone, she served as a senior manager of SEC reporting and accounting policy at National Rural Utilities Cooperative Finance Corporation. She also worked as a senior manager in the assurance practice of KPMG LLP. Ms. Schaltenbrand is a CPA in Virginia and a member of the AICPA and VSCPA.

Bob Marcotte President

Mr. Marcotte joined Gladstone Capital in December 2013. He has extensive experience in commercial finance and investment banking, focusing on the origination and management of middle market debt and equity investments for both private equity sponsors and owner-operators since 2002. Before joining Gladstone, Mr. Marcotte was an Executive Vice President and Co-Head of Asset Management for MCG Capital, a publicly-traded business development company, where he was responsible for investment origination, evaluation, underwriting, and portfolio management.

Michael LiCalsi Chief Administrative Officer, Co-General Counsel, and Co-Secretary

Mr. LiCalsi has served as Chief Administrative Officer since July 2025, General Counsel since October 2009, and Secretary since October 2012. He was appointed President of Gladstone Administration in July 2013. Mr. LiCalsi is a graduate of the George Mason University School of Law, where he served as Editor-in-Chief of the George Mason Law Review, and is a member of the Virginia State Bar and District of Columbia Bar.

John Sateri Managing Director

Mr. Sateri has been with The Gladstone Companies since April 2007. He currently serves as a Managing Director at the McLean, VA Headquarters and is a member of the Investment Committee that supports all Gladstone managed credit, equity, and real estate funds. He is also involved in originating debt and equity investments in privately held companies.

Here are the key risks to Gladstone Capital (GLAD):

1. Exposure to Economic Downturns and High Interest Rates: Gladstone Capital's portfolio companies, primarily in the lower middle market, are highly susceptible to economic downturns and sustained high interest rates. Such conditions can lead to increased non-accruals (defaults) on their debt investments, negatively impacting the company's net investment income and net asset value (NAV). A higher cost of debt for portfolio companies due to persistent high interest rates further exacerbates this risk.
2. Challenges in Capital Deployment and Asset Growth: The company has faced difficulties in deploying capital effectively into new investments, which hinders asset growth. This limitation can prevent Gladstone Capital from offsetting potential non-accruals in its existing portfolio and achieving meaningful earnings growth, particularly in a challenging economic environment.
3. Leverage, Debt Management, and Dividend Sustainability: Gladstone Capital's financial health is sensitive to its leverage levels and ability to manage its debt, including refinancing existing obligations. Increases in total liabilities and interest expenses can pressure profitability. Furthermore, the sustainability of its dividend payouts, which are crucial for attracting investors, is a concern, especially with narrowing dividend coverage and potential NAV erosion. The issuance of convertible notes also introduces a risk of shareholder dilution.

1. Growth in Net Originations and Investment Portfolio: Gladstone Capital consistently highlights a "healthy pipeline of new deals" and "attractive net originations" in the lower middle market. This continued focus on originating new debt and equity investments, particularly with private equity-sponsored companies, directly expands its earning asset base, leading to increased interest and fee income.
2. Expansion of Average Earning Assets: A key driver of Gladstone Capital's revenue is the growth in its average earning assets. An increase in the total value of its interest-bearing investments directly translates to higher interest income, a primary component of its total investment income. Management has reported growth in average earning assets in recent periods.
3. Consistent Fee Income from Deal Flow and Prepayments: Beyond interest income, Gladstone Capital generates revenue through various fees, including those from new deal originations and prepayments from existing portfolio companies. The ability to generate and efficiently redeploy capital from these prepayment events into new, potentially higher-yielding investments can provide a recurring boost to revenue.
4. Strategic Focus on Lower Middle Market and Specialty Financing: The company's specialization in providing debt and equity investments to lower middle market companies, including senior and junior subordinated loans, unitranche loans, and mezzanine loans, allows it to target a specific market segment. This niche focus, coupled with investments in growth-oriented businesses and sponsor-backed deals, is expected to drive consistent deal flow and maintain attractive portfolio yields.

Share Repurchases

• Gladstone Capital Corporation's board of directors authorized a share repurchase program for up to $7,500,000 of its common stock.
• The repurchases are intended to be implemented through open market transactions or privately negotiated transactions.
• The repurchase program does not obligate the company to acquire any particular amount of stock, with timing, prices, and sizes dependent on market conditions.

Share Issuance

• In December 2025, Gladstone Capital issued $150 million of 5.875% convertible notes due 2030.
• In September 2025, the company priced a registered public offering of $130.0 million aggregate principal amount of 5.875% convertible notes due 2030, an offering that was upsized from $110.0 million.
• As of the first quarter of fiscal year 2026, Gladstone Capital Corporation had 23 million shares outstanding.

Outbound Investments

• For the fiscal year ended September 30, 2025, Gladstone Capital invested $310.7 million in 15 new portfolio companies and an additional $86.1 million in existing companies.
• In the fourth quarter of fiscal year 2025, the company invested $107 million in five new portfolio companies and $20 million in existing portfolio companies.
• Gladstone Capital typically invests between $8 million and $40 million in debt and equity, primarily secured first and second lien term loans, in lower middle market companies. As of Q1 2026, Gladstone Capital's investments had a fair value of $902.9 million.