Trinity Capital (TRIN) Q4 2025 Earnings Transcript

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DATE

Feb. 25, 2026 at 12 p.m. ET

CALL PARTICIPANTS

• Chief Executive Officer — Kyle Brown
• Chief Financial Officer — Michael Testa
• Chief Operating Officer — Gerald Harder
• Chief Credit Officer — Ronald Kundich

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TAKEAWAYS

• Net Investment Income -- $40 million in Q4, representing a 15% increase year over year, and 102% coverage of the quarterly distribution.
• Total Investment Income -- $83 million, up 17.5% year over year.
• Net Asset Value -- Reached $1.1 billion, a 10% increase quarter over quarter and up 33% year over year.
• Net Asset Value Per Share -- Increased from $13.31 to $13.42 quarter over quarter.
• Platform Assets Under Management -- Surpassed $2.8 billion, a 38% year-over-year rise.
• Fundings -- $435 million funded in Q4, totaling $1.5 billion for the year, a 2,021% increase compared to the previous year.
• Total Commitments -- $22.1 billion in commitments platform-wide as of year end.
• Unfunded Commitments -- $1.2 billion at year end; 93% require additional diligence or committee approval, with only 7% unconditional.
• Dividend Policy -- Paid fourth-quarter cash dividend of $0.51 per share, transitioned to $0.17 per month in Q1 2026 while maintaining the same total quarterly payout.
• Undistributed Taxable Income -- Approximately $69 million, or $0.84 per share, retained for shareholder benefit.
• Return on Equity -- 15.3%, described by management as "among the highest in the BDC space."
• Weighted Average Effective Portfolio Yield -- 15.2% for the quarter.
• Net Leverage Ratio -- Ended the quarter at 1.18x.
• Nonaccruals -- $15.2 million at fair value, less than 1% of the debt portfolio, with four companies on nonaccrual (two new, two resolved in Q4).
• Credit Quality -- Over 99% of debt investments performing at fair value; average internal credit rating of 2.9 on a five-point scale.
• First-Lien Attachment -- 85% of principal secured by first-position liens; 15% second lien.
• Loan-to-Value (Enterprise Loans) -- Weighted average of 17%.
• Industry Concentration -- Finance and insurance is the largest at 14.6% (cost), diversified across 25 companies; no single borrower exceeds 3.9% exposure.
• Portfolio Diversification -- Investments span 22 industries across five business verticals: sponsor finance (27% Q4 fundings), equipment finance (25%), life sciences (20%), tech lending (15%), and asset-based lending (13%).
• Platform Expansion -- Managed $400 million in private vehicles as of Dec. 31; Q4 co-investment vehicles contributed $3.1 million, or $0.04 per share, in incremental net investment income.
• Capital Raising -- Raised $95 million via equity ATM at a 12% premium to NAV and $28 million in debt ATM at a 1% premium to par in Q4; entered new secured term loan with lower spread relative to the credit facility.
• Interest Rate Sensitivity -- Majority of loans have floors; further rate cuts described as having a "muted effect" on earnings power and potentially offset by prepayment fees and reduced interest expense.
• PIK Income -- Less than 2% of total income driven by payment-in-kind structures.
• Software Exposure -- Enterprise SaaS is 9.3% of the portfolio, predominantly newer cohorts backed by private equity; approximately three-quarters originated via sponsor finance.
• Portfolio Company Capital Raises -- Portfolio companies raised more than $7.8 billion in equity during 2025.
• Pipeline -- Over $1 billion in backlog, with roughly one-third tied to equipment finance; most is subject to milestones or further diligence.
• Cumulative Total Return Since IPO -- 109%, compared to 70% for peer average and 82% for the S&P 500 over the same period.

SUMMARY

Trinity Capital (NASDAQ:TRIN) reported record net investment income, significant growth in platform assets under management, and continued low nonaccruals, highlighting the strength of its diversified lending platform. The company executed a strategic shift to monthly distributions while maintaining total payouts and demonstrated scalability through substantial co-investment contributions and continued growth in managed funds. Management's capital-raising initiatives and access to low-cost leverage—including expansion of SBIC capacity and multiple co-investment vehicles—are fueling Trinity Capital’s ongoing platform buildout and balance sheet durability.

• Management described interest rate floors as insulating most loan income from future rate cuts and indicated increased likelihood of prepayment fee income should rates decline further.
• Q4 fundings were allocated across all five verticals, reflecting even deployment momentum and supporting the portfolio’s diversification priorities.
• Portfolio companies’ $7.8 billion in equity raises during 2025 signal sustained borrower strength and reinforce management’s view that capital access remains robust among underlying borrowers.
• While discussing software exposure, management clarified that nearly all SaaS positions result from recent disciplined entry focused on lower valuations and strong private equity backing.
• Outstanding unfunded commitment levels, combined with rigorous investment committee diligence, point to purposeful growth rather than indiscriminate volume expansion.
• Management highlighted that credit performance metrics remained stable, with an average internal credit rating unchanged and nonaccruals held to minimal levels despite portfolio scale-up.
• The company reported that growth in managed funds and co-investment vehicles is providing new fee streams and enhancing returns independent of balance sheet lending activities.

INDUSTRY GLOSSARY

• BDC: Business development company -- an investment vehicle providing capital to small and midsize private companies, often through debt and equity instruments.
• SBIC: Small Business Investment Company -- a government-licensed fund that provides low-cost leverage to finance eligible small businesses.
• ATM Program: At-the-market offering -- a mechanism for companies to issue new shares or debt incrementally into the market at prevailing prices.
• Nonaccrual: Loans where the borrower is no longer making timely interest or principal payments and therefore interest is no longer being accrued as income.
• PIK: Payment-in-kind -- a form of interest paid by issuing additional securities rather than in cash.
• Enterprise SaaS: Software as a Service solutions targeted at business customers, typically with recurring revenue subscription models.
• First-Lien: Loan or debt secured with the highest priority claim on an asset in case of default.
• Co-investment Vehicle: Investment structure allowing third-party capital to participate alongside a firm’s primary fund in portfolio company financings.

Full Conference Call Transcript

Kyle Brown: Thank you, Ben, and thanks everyone for joining us today. Trinity Capital Inc. is experiencing strong momentum right now, and our investors are seeing the benefits from our diversified platform, our internally managed structure, and our continued growth. 2025 was a banner year for us. We achieved records in many major operating categories. Our five complementary verticals continue to drive real diversification, and our internally managed structure creates accretive value for shareholders. Together, those advantages clearly differentiate Trinity Capital Inc. in the private credit space.

Major highlights from 2025 include excellent operating results with record-setting net investment income of $144 million, or $2.08 per share; a transition to monthly dividends, providing more frequent income for shareholders as well as continued consistency of our distributions; sustained momentum with our originations engine as we achieved a record $1.5 billion of fundings and $22.1 billion of commitments; and significant growth of our managed funds business through the establishment of several co-investment vehicles, which provide new liquidity to the platform and incremental income to Trinity Capital Inc. shareholders. We finished the year with an especially strong fourth quarter. Here are some of the highlights from Q4.

We delivered $40 million in net investment income, a 15% increase compared to Q4 of last year. Our net asset value grew 10% quarter over quarter to a record $1.1 billion. Platform AUM increased to more than $2.8 billion, up 38% year over year. We maintained strong credit quality with nonaccruals at less than 1% of the portfolio at fair value. Trinity Capital Inc. paid a fourth quarter cash dividend of $0.51 per share and announced a $0.17 per month distribution for the first quarter. Trinity Capital Inc. shareholders have now been the beneficiaries of more than six consecutive years of a consistent or increased dividend. Trinity Capital Inc. continues to outperform in key metrics.

Our return on equity and effective yield rank at or near the top in the BDC space. Our NAV has grown 33% year over year, while our credit metrics have remained strong and consistent. Since our IPO five years ago, Trinity Capital Inc. stock has delivered a cumulative total return of 109%, far outpacing both the peer average of 70% and the S&P 500's 82% over that same time period. Looking forward, we have an ever-growing managed funds business, as well as 209 warrant positions and 130 portfolio companies, with the potential to provide incremental upside to our shareholders. We have entered 2026 with strong momentum.

In Q4, we funded $435 million, bringing full-year investments to $1.5 billion, 2,021% more than the prior year's total. Our investment pipeline remains robust with $1.2 billion in total unfunded commitments as of year end. As a point of emphasis, 93% of our unfunded commitments remain subject to rigorous ongoing diligence and investment committee approval, and only 7% of these commitments are unconditional. Our originations activity reflects consistent growth in all of our verticals across the Trinity Capital Inc. platform, powered by an elite team of originators and underwriters. We are a direct lender. We own the pipeline.

We do not depend on syndicated deals, and we have immaterial overlap with other BDCs, all of which give our investors access to a highly differentiated portfolio of investments through our five business verticals. All the while, we remain deeply committed and disciplined in our underwriting approach and credit performance, which are crucial to our long-term success. I would like to share a few thoughts that are newsworthy topics of late. Regarding AI and the software space, anyone saying that AI is going to end software is off base. Anyone saying AI will not change software is also off base. The recent overreaction around AI's impact on the software industry is not new to us.

We have been dealing with AI-driven disruption for more than three years, and we have made thoughtful decisions to strategically diversify our portfolio and opportunistically invest in adjacent sectors to the AI space. Enterprise SaaS is currently 9% of our portfolio. Many of those are private equity-backed lower middle-market companies that have, over the last few years, introduced new AI tools to their offerings. Software, and particularly incumbent and trusted software, is the means of integrating these new AI efficiencies. The strongest companies continue to adapt and perform well. We are not seeing any weakness in our software investments. Companies with the best management teams, the strongest moats, and the most versatile strategies continue to separate themselves from the pack.

More importantly, we are also not placing bets on individual AI winners and losers. We are proactively marketing our services to SaaS companies that want to on-prem their compute. Our equipment finance business has been active in the space for multiple years and has the ability and experience to provide CapEx financing for data centers, GPUs, CPUs, and power generation equipment. We are investing in the picks and shovels that power the entire ecosystem. This is the infrastructure that every AI application depends on, regardless of which companies rise or fall in the application layer. We strongly believe that the AI versus SaaS debate is not a zero-sum game.

We will continue to keep the portfolio diversified and our investment approach nimble as we identify new and underserved markets to generate alpha returns for our shareholders. Moving to rate cuts. So far, they have had little impact on our business. Based on our modeling, additional cuts would likely have a muted effect on our earnings power. Unlike most other lenders, the majority of our loans have interest rate floors set at or near the original levels. So when rates come down, our income does not fall proportionally. In fact, much of the portfolio is already at those floors. Further cuts could actually accelerate early repayments, allowing us to capture prepayment or restructuring fees.

At the same time, lowering rates would reduce the interest expense on our floating-rate credit facility, lowering our cost of capital. And lastly, PIK continues to be a nominal portion of our income with less than 2% of our income based on PIK, another one of Trinity Capital Inc.'s differentiators in the BDC space. We continue to strategically raise equity, debt, and off-balance sheet capital to fuel our growth. In 2025 and 2026, we closed several co-investment vehicles, leading asset managers, adding liquidity, and generating management fees. We also converted a separate vehicle into a private BDC that is actively raising capital.

At the same time, we are seeing strong momentum in capital-raising efforts for our third SBIC fund, which will provide attractive low-cost leverage and is expected to add more than $260 million of incremental capacity to the platform once scaled. Together, these initiatives demonstrate our ability to thoughtfully grow, expand investment capacity, and further diversify our capital base. What we are building is not your typical BDC. Our wholly owned managed fund business oversees third-party capital and generates new income above and beyond the interest and equity returns from our BDC's portfolio investments. Trinity Capital Inc. shareholders benefit from these fees collected by our managed funds business.

We are building a platform that can scale while driving up earnings and NAV. We believe our consistent performance is driven by three things: our differentiated structure, disciplined underwriting, and world-class team. Our five complementary verticals—sponsor finance, equipment finance, tech lending, asset-based lending, and life sciences—allow us to stay diversified while operating squarely within our core competencies. Each vertical has dedicated originators, underwriters, and portfolio managers, creating a scalable and highly effective operating model. Structurally, as an internally managed BDC, our employees, management, and board own the same shares as our investors, increasing alignment and a shared commitment to consistent dividends and long-term value creation.

That structure also supports a premium valuation because shareholders own both the management company and the underlying assets. Management and incentive fees generated through our managed fund business flow directly to the BDC, creating incremental income, enhancing value, and fueling growth, all for the benefit of our shareholders. From a talent perspective, we are passionate about fostering a vibrant culture rooted in humility, trust, integrity, uncommon care, continuous learning, and an entrepreneurial spirit. Our unique culture enables us to attract and retain the best people in the industry and fuels our continued growth trajectory. From day one, our objective has been simple: consistently out-earn the dividend while growing the BDC. And we continue to execute on that commitment.

Trinity Capital Inc. is strategically positioned to capitalize on the opportunities ahead, supported by a diversified pipeline, disciplined underwriting, and an expanding managed funds platform. We are not your typical BDC. That differentiation matters. We are building more than a portfolio—building a durable, aligned, and scalable platform designed to compound value over time. As we look to 2026 and beyond, we believe our best days are still ahead. With that, I will turn the call over to our CFO, Michael Testa, to discuss our financial results in more detail. Michael?

Michael Testa: Thanks, Kyle. Our operational and financial performance remained strong in the fourth quarter. We generated $83 million in total investment income, a 17.5% year-over-year increase, and $40 million in net investment income, or $0.52 per basic share, representing 102% coverage of our quarterly distribution. Beginning in January 2026, we transitioned to a monthly dividend of $0.17 per share, maintaining the same aggregate quarterly payout and aligning the timing of our distributions with the recurring nature of our investment income. Estimated undistributed taxable income was approximately $69 million, or $0.84 per share, which we continue to reinvest for the benefit of our shareholders while maintaining a consistent and meaningful distribution.

Our platform continues to deliver top-tier performance, generating a 15.3% return on average equity, among the highest in the BDC space, and our weighted average effective portfolio yield remained strong at 15.2% for the quarter despite a declining rate environment. Net asset value per share increased from $13.31 at the end of Q3 to $13.42 at the end of Q4, reflecting accretive capital raises. Total NAV rose 10% to $1.1 billion, up from $998 million at the end of Q3. We further strengthened our capital base by raising $95 million through our equity ATM program during the quarter at an average premium to NAV of 12%.

During the quarter, we also entered into a new secured term loan, extending the maturity profile of our liabilities and further diversifying our capital base. The facility was priced at a spread below our existing revolving credit facility, contributing to an improvement in our overall cost of debt. Additionally, in Q4, we raised $28 million of gross proceeds through our debt ATM program at a 1% premium to par. Our co-investment vehicles continue to enhance returns, contributing approximately $3.1 million, or $0.04 per share, of incremental net investment income benefit in Q4. We syndicated $47 million to these vehicles during the quarter. As of December 31, we managed $400 million in assets across our private vehicles.

Our net leverage ratio remained consistent at 1.18x at quarter end. With strong liquidity, diversified capital sources, and capacity across the Trinity Capital Inc. platform, we are well-positioned to underwrite a robust pipeline, maintain strict credit discipline, and deploy capital into high-conviction opportunities. To discuss our portfolio performance in more detail, I will now pass the call over to our COO, Gerald Harder. Gerald?

Gerald Harder: Thank you, Michael. Our portfolio continues to demonstrate exceptional strength, driven by broad diversification across 22 industries, with no single borrower representing more than 3.9% of total exposure. Our largest industry concentration, finance and insurance, accounts for 14.6% of the portfolio at cost and is diversified across 25 portfolio companies. Credit quality remained consistent quarter over quarter, with over 99% of debt investments performing at fair value. On our one-to-five scale, where five indicates very strong performance, the average internal credit rating was 2.9, consistent with prior quarters and reflecting the addition of high-quality originations and continued strong portfolio management. Quarter over quarter, the number of portfolio companies on nonaccrual remained at four.

During Q4, two relatively small debt financings were added to nonaccrual status, while two prior nonaccrual investments were realized and rolled off. As of December 31, nonaccruals totaled $15.2 million at fair value, representing less than 1% of the total debt portfolio. At quarter end, 85% of total principal was secured by first-position liens on enterprise value, equipment, or both. For enterprise-backed loans, the weighted average loan-to-value remained consistent at 17%. During 2025, our portfolio companies collectively raised more than $7.8 billion in equity, emphasizing the strength of our borrowers and their continued access to capital. Across our five business verticals, we are seeing deployment begin to smooth out more evenly, a trend we expect to continue in future quarters.

The approximate breakdown of our fundings in Q4 was as follows: 27% to sponsor finance, 25% to equipment financing, 20% to life sciences, 15% to tech lending, and 13% to asset-based lending. Looking ahead, our portfolio remains defensively positioned with a strong first-lien bias and low loan-to-values. Our momentum, disciplined underwriting, and diversified platform allow us to continue delivering consistent dividends and NAV growth. With a shareholder-first mindset, our team remains focused on building a best-in-class BDC that generates sustained long-term value for our investors. We will now open for questions. Operator?

Stephanie: To ask a question, please press star 1 on your keypad. To leave the queue at any time, press star 2. Once again, that is star 1 to ask a question. We will pause for just a moment to allow everyone the chance to join the queue. Our first question comes from Casey Alexander of Compass Point. Please go ahead. Your line is now open.

Casey Alexander: Good morning, and thanks for taking my questions. On most of these calls so far this quarter, we have been talking a lot more defense than offense, but I think Trinity Capital Inc. appears to be in a position to play offense, and because of your five verticals, your software position appears to be indexed below most of the peer group. So I am wondering, as is there an opportunity that is going to be arising for you to take advantage of the turmoil if other platforms are unwilling or unlikely to continue with software loans?

Is there an opportunity to convert some of those to equipment finance loans where you have a collateralized position on it in front of the enterprise value and thereby earn some better spreads and better risk-adjusted rates of return?

Kyle Brown: Yeah. Hey, Casey. Thanks for the question. Yeah. We see it that way. I mean, one of the reasons why our percentage of assets in that category is low is because we entered that space really in earnest in the last two years, and that is because valuations were significantly too high and pricing was very low, and we decided to enter when we did as valuations started to come down, and we thought that was a great entry point. Our attachment rates could be lower, we could have more aggressive pricing, and so we are being opportunistic right now.

I think in particular, our kind of sponsor finance, you know, think $3 million to $30 million of EBITDA, lower middle-market software companies with AI and that are AI-enabled, is a massive opportunity. We think there is going to be a lot of consolidation, a lot of these companies that maybe could not get to scale, and so with access to the capital markets, with access through our fund management business to private capital, we have liquidity, and we will continue to be opportunistic there.

Stephanie: Thank you. We will take our next question. Thank you. We will take our next question from Doug Harter of UBS. Please go ahead. Your line is open.

Cory Johnson: Hi. This is Cory Johnson on for Doug. So I was just wondering, are there any parts of your portfolio that give you any concern, or either, you know, perhaps areas that you have lent to traditionally but you are a bit more cautious around currently? And are there any verticals that you are particularly looking to lean into a bit more during this time?

Kyle Brown: Hey, Cory. Thanks for the question. So, historically, we focus on industries that are emerging, that have disruptive technology, moats around that technology. They are well-capitalized. Equity dollars are flowing into that particular industry. That has always been part of our underwriting, and that has not changed. So our investment philosophy and kind of where we direct dollars continues to evolve and change over time as new and emerging technologies ramp up, and so we will just continue to see where the market is going, where equity dollars are flowing.

And then, of course, with our loans being shorter-term duration and fully amortizing in many cases, you know, we continue to get paid off where industries are evolving and maybe not receiving as much equity dollars, and so that continues to bleed off in industries that are not getting the attention they used to, and new dollars are being deployed into emerging markets, and so that has been our philosophy. That continues to be the philosophy going forward.

Cory Johnson: Great. Thank you.

Stephanie: Thank you. We will take our next question from Brian McKenna with Citizens. Please go ahead. Your line is open.

Brian McKenna: Okay, great. Thanks. I know the focus today is continuing to go deeper across all five of your verticals. I am curious though, and you touched on deployment environment a little bit, but given the pickup in volatility, there is clearly dislocation across the sector. I mean, would you ever think about leaning into any strategic here if the environment stays like this? You clearly have a strong and liquid balance sheet. You have access to debt and equity capital, so I am wondering if this would be a period where we could actually see you go from five verticals to six. That is helpful, Kyle. And then one more, if I may.

I know growth of the RIA and your third-party asset management business is a big focus area for this year. What are you hearing from these LPs, potential investors in some of these third-party funds with all the focus, all the volatility in and around private credit today? And I am trying to figure out, for Trinity Capital Inc., could this actually be a positive for this business—related fundraising, related growth—as some of these allocators maybe look to diversify away from some of the larger players in the upper middle markets and really as folks look to kind of have more exposure to uncorrelated assets and performance?

Kyle Brown: Great question. And, you know, Sarah is kicking me—no forward-looking statements here. So it is a great point. We are going to continue to be opportunistic.

I mean, we are making sure that we have plenty of ample liquidity available to us so that in a market where there is volatility—and I would say most of the volatility that we are seeing so far has little to do with kind of portfolio volatility, but much more to do with kind of valuation volatility—our game plan all along has been to make sure that we have liquidity to take advantage of markets when there is less liquidity, less competition, maybe private companies with funds that have reached their duration where we can be opportunistic and jump in there, and so the answer is absolutely yes, and we will continue to keep our eyes open and be opportunistic as opportunities present themselves.

Yeah. I mean, I personally love the volatility. There has been a massive amount of inflows for years going into just a small number of upper middle-market firms, and with rates low, they have been able to deploy and deliver decent returns. Well, that has changed, and we have an opportunity to stand out in a unique way by delivering outperforming results, and I think investors are going to love that. And we have the ability to generate higher returns, and we have been doing it consistently. And so there are outflows happening. You see it—you are seeing it in the news often now.

I think what we are seeing is more and more interest and more inflows as we continue to build out our fund management business. So I see this as a really great year and opportunity for us to stand out in a unique way in what has been a crowded space for the last five years. And so that is what we are hoping to achieve, and, you know, as we wrap up kind of SBIC funds and enroll into kind of future fundraising, we are, you know, we are really positive on it right now.

Brian McKenna: Alright. I will leave it there. Thanks so much.

Kyle Brown: Yep.

Stephanie: Thank you. Once again, if you would like to ask a question, please press star 1. We will take our next question from Eric Zwick with Lucid Capital Markets. Please go ahead. Your line is open.

Eric Zwick: Thanks. Hello, everyone. Just as I take a look at the kind of breakdown of your fourth quarter originations, both in terms of absolute amount and dollar terms, you know, more weighted towards the existing portfolio, which I think is just a testament that you selected solid companies to invest in, they are growing and have more needs. Curious, looking towards the pipeline today, is the mix still weighted maybe more heavily towards existing portfolio needs versus new needs? And kind of curious also what that might mean in terms of your perception of the quality of new investments that you are looking at, whether tight spreads or more competition has impacted the attractiveness there?

Kyle Brown: Yeah. I think, you know, over the last year, we have been focused on new logos and new investments, and that has been the majority of our deployment. And then, you know, I think our portfolio is unique. When we are deploying to our current portfolio, a lot of that is going to be equipment financing facilities where they have multiple draw schedules, and if they are hitting their milestones and growing, then we are building out more capacity, or if they are delayed-draw term loans, these companies have reached some—again, hit milestones, hit hurdles—and earned their ability to receive more capital.

So it is all new investments to growing companies, and that is the vast majority of our fundings, and that is not going to change. I do not think. Want to add anything to that?

Gerald Harder: Yeah. I mean, Eric, our backlog—as you see in it—you know, over a billion dollars. A third of that is to our equipment channel. So as they build out their manufacturing lines, we are going to fund alongside that, and a small percentage of that billion dollars is subject to legally binding milestones. Most of it is subject to milestones or additional due diligence.

Kyle Brown: Yeah. I think it would be fair to say the number of new logos in Q4 was relatively small, right? And so I think that is idiosyncratic. I do not expect that to continue at that level, but we are pleased to deploy to those existing portfolio companies.

Eric Zwick: Thanks. I appreciate the commentary from all of you there. Just turning to credit quality a little bit. It is nice to see that nonaccruals still remain very low and well below peer averages. As you mentioned, you did have two realizations, but then two new credits added to the nonaccrual. To the extent that you can comment on Zume and 3DEO, anything noteworthy in their developments there that had them moved to nonaccrual, and then how you are approaching working with them to get them through the difficulties?

Ronald Kundich: Thanks, Eric. This is Ron. Yeah. Those two clients, those are legacy borrowers. They have been in the portfolio for quite some time. They are a bit storied, and at the highest level, they got in positions where they stopped making payments in Q4, so they are put on the nonaccrual list. We are actively working them as we speak, and, you know, we expect to have—as of today, you know? We will see what the outcomes are.

Eric Zwick: Excellent. Thanks, Ron. Thanks all. That is all for me.

Stephanie: Thank you. We will move now to Christopher Nolan with Ladenburg Thalmann. Please go ahead. Your line is now open.

Christopher Nolan: Hey, guys.

Kyle Brown: Hey.

Christopher Nolan: Jerry—I think it was Jerry or Ron—you mentioned that you are seeing portfolio companies raise more capital, equity. Can you give a little color? Is this private equity sales, or are these follow-on investments from existing investors? Are these things mostly or tangentially related to AI?

Kyle Brown: Boy, it is, you know, all of the above, right? You know, we have got some portfolio companies accessing the public markets. We have got other portfolio companies raising through their VC or PE sponsors. I do not know that within our portfolio, I would say much is directly related to AI. I mean, I have nothing to add to that. You know, I think what you are seeing is just what you have been seeing for years now, which is the VC market is robust.

There was nearly $100 billion deployed in Q4, and so the companies we are lending to, they are growing, they are raising capital, and so it is just—it is really not a surprise that they were able to raise it with the size of the market where it is today.

Christopher Nolan: Yeah. The only issue with that point is 70% of VC dollars going towards AI or AI-related stuff. So seems to be pretty concentrated.

Kyle Brown: Yeah. I would agree with that, Chris, except—think about it, right—because our portfolio, we enter at that growth stage, right? So we are entering in businesses that are, you know, actively growing revenue base, right, and not sort of new entrants into a space. So I think maybe some of the newer VC dollars are going into AI-driven companies, but companies that were founded, you know, say, five years ago that are now in growth stage and are raising equity, that is more what the Trinity Capital Inc. portfolio looks like.

Christopher Nolan: Great. And then as a follow-up question, given all the turmoil that is affecting software and things like that, is there any consideration of having the entire investment portfolio valued more frequently than it currently is?

Kyle Brown: Yeah. I mean, the answer is no, and I think maybe that would make more sense if you had a significantly larger exposure to enterprise SaaS. Our exposure is relatively low, and it is relatively new, and every one of those deals already had an AI filter, an underwriting filter put into it. So, meaning, we are looking at these companies and understanding their moat, right? Understanding how and what their AI roadmap looks like, and so the investments we have been making—I mean, two and a half years ago, they called it machine learning, and that is what we were looking at, and now it is called AI, right?

And so, you know, I think AI will continue to evolve, and it will continue to be tools that a lot of our companies are utilizing, but it is not necessarily changing, and we have not seen within our portfolio any detriment to those companies.

Michael Testa: Yeah. And I would add, Chris, you know, as Kyle said in his prepared remarks, right, enterprise software is about 9% of our assets. About three-quarters of that is originated by our sponsor finance team, so, you know, these will be 18 months or newer cohorts and backed by private equity where, you know, we are in front of their dollars, right? They have got significant cash in these businesses. So from a valuation standpoint, you know, we feel good about where we are in a first-lien role there. Now, has their equity valuation changed? Probably, right? But from our debt standpoint, we do not see degradation in the debt valuations in that case.

Christopher Nolan: Okay. Thank you, guys.

Kyle Brown: Thanks, Chris.

Stephanie: Thank you. We will take our next question from Mickey Schleien with Clear Street. Please go ahead. Your line is open.

Mickey Schleien: Most of the high-level questions have been asked. Just one high-level question on my behalf. You know, we see different ways of defining portfolios in terms of industry segments across the space. I do see your software allocation that you mentioned of—what was it—9.3? Is your software buried elsewhere in the portfolio, or is that the total amount?

Kyle Brown: Yeah. I mean, the answer is that is the total amount of enterprise software companies that we are currently invested into.

Michael Testa: Yeah. I mean, that is the concentration of, you know, where software-as-a-service business model—right? Certainly within, you know, other types of portfolio companies, they are going to be, you know, using software and AI and machine learning tools, and so, yes, there is some embedded inclusion there. But, you know, this is something that, you know, as we underwrite these companies, we are keenly aware of—that they have got to show how this AI revolution is accretive to them and not an imminent threat in underwriting. So, yeah, pure SaaS, 9.3%. Embedded elsewhere, sure. You know, could not tell you exactly where and how much, though.

Mickey Schleien: I understand. Could you also give us a sense of the proportion of the portfolio that is invested in second-lien investments?

Michael Testa: Yes, 15%. I think that was in the prepared remarks. So we are going to be 85% attached to first lien on enterprise, equipment, or both.

Mickey Schleien: Terrific. And lastly, was there anything nonrecurring in interest expense for the quarter? Because interest expense went up more than your debt balances, and the incremental debt was at lower cost, so I am just trying to triangulate that.

Michael Testa: Yeah. Maybe—this is Mike—there was a tick-up in early repayments this quarter, so you will see there was some acceleration of OID included in interest income.

Mickey Schleien: I was referring to interest expense.

Michael Testa: Oh, on the expense side? No. I mean, I think you will see that tick up with average outstanding loan balance of our revolver, but, yeah, on the expense side, we actually improved our cost of debt this quarter with the secured term financing, but that is going to be fluctuated—the floating rate is the revolver in the term loan.

Mickey Schleien: I understand. Those are all my questions this afternoon. I appreciate your time. Thank you.

Kyle Brown: Thanks, Mick.

Michael Testa: Thanks, Mick. Thanks.

Stephanie: Thank you. At this time, we have reached our allotted time for questions. I will now turn the call back to Kyle Brown for any additional or closing remarks.

Kyle Brown: Well, on behalf of the Trinity Capital Inc. team, thank you for joining us today. We appreciate your continued interest and investment in Trinity Capital Inc., and we look forward to updating you on Q1 results during our next earnings call on May 6. Have a great day. Thanks.

Stephanie: Thank you. This brings us to the end of today's meeting. We appreciate your time and participation. You may now disconnect.

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