SuRo Capital (SSSS) Q4 2025 Earnings Transcript

Image source: The Motley Fool.

DATE

Tuesday, March 10, 2026 at 5 p.m. ET

CALL PARTICIPANTS

• Chairman and Chief Executive Officer — Mark Klein
• Chief Financial Officer — Allison Green

Need a quote from a Motley Fool analyst? Email pr@fool.com

TAKEAWAYS

• Net Asset Value (NAV) -- $8.09 per share at year-end, up approximately 21% year over year from $6.68 per share.
• Total Shareholder Return -- Stock price rose from $5.88 to $9.44, with a $0.50 dividend per share declared and paid, resulting in an approximate 70% total return for the year.
• Potential NAV Uplift -- CEO Klein stated that completed or near-term portfolio financings, "could contribute at least $5.00 and as much as $6.50 per share to our current net asset value," not included in the reported NAV.
• Dividend Payment -- $0.50 per share in cash dividends declared and paid during the year; the final $0.25 per share was paid on December 5.
• Portfolio Concentration -- Top five positions (OpenAI, Whoop, Blink Health, Canva, Learning Home) comprised approximately 54% of portfolio fair value; top ten positions represented 80% of portfolio value at year-end.
• Investment Thematic Allocation -- Allocation to artificial intelligence infrastructure and applications represented approximately 31% of portfolio fair value; consumer goods and services accounted for 21%; software-as-a-service represented 20%.
• CoreWeave Distributions -- Three fourth-quarter distributions from CWO Opportunity II, LP totaled approximately $9 million ($2.3 million return of capital and $6.7 million gain).
• Forge Global Realization -- Sale of remaining 70,530 shares yielded net proceeds of approximately $3.1 million and a realized gain of $1.1 million for the quarter (cumulative $5 million on investment).
• TensorWave Commitment -- Up to $20 million committed to Magnetar Opportunity 2025-4, LP (investment into TensorWave Inc.), with $5 million funded as of March 10; remainder subject to certain conditions.
• Note Repurchases -- 1,566,807 of 6% notes due 2026 repurchased for approximately $38.9 million, representing about 52% of original issuance.
• Share Repurchase Program -- $64.3 million aggregate authorization extended, with $25 million available for future repurchases at year-end.
• ATM Share Sales -- 6,595 shares sold for net proceeds of approximately $53,000; up to $87.9 million of shares remain authorized under the ATM program.
• Liquidity -- Year-end liquid assets were approximately $50.1 million ($49 million in cash, $1.1 million in unrestricted public securities).
• Convertible Notes Adjustment -- Conversion rate of 6.5% convertible notes due 2029 reduced to $7.32 per share (from $7.53) after the $0.25 per-share dividend.
• Shares Outstanding -- 25,377,756 shares of common stock outstanding at year-end.

SUMMARY

SuRo Capital Corp. (NASDAQ:SSSS) reported a significant increase in NAV and shareholder return, driven by disciplined portfolio management and major positions in private technology companies. Management disclosed that multiple portfolio company financings completed or in process since the start of 2026 are expected to raise current NAV by at least $5.00 and up to $6.50 per share, but these potential gains are not reflected in the year-end NAV. The company also executed on major realizations, including substantial distributions from CoreWeave, and further diversified exposure to AI infrastructure through a new commitment to TensorWave Inc.

• Klein stated that all referenced financings expected to drive the projected NAV uplift "will all be completed certainly by the end of the quarter," though public disclosures by the underlying companies may lag the actual closings.
• Mark Klein characterized the current acceleration in private AI company valuations and fundraising rounds as "pretty unprecedented," noting a rate of increase and scale similar to the 1999–2001 public venture market, with "the acceleration in the private markets" now outpacing public market valuations.
• Tens of millions in note and share repurchase authorizations remain, supporting ongoing capital return flexibility.
• Operating expenses are expected to stay "pretty static," and the company does not generate regular investment income outside of realized capital gains.
• The $20 million TensorWave commitment, one of the largest in SuRo Capital Corp.'s history, was structured to limit initial exposure until specified milestones are achieved, signaling a flexible but conviction-driven investment approach in AI infrastructure.
• Company highlighted that top portfolio exposures, particularly in AI-related themes, continue to account for a significant proportion of total assets, indicating continued thematic alignment with sector growth trends.

INDUSTRY GLOSSARY

• ATM (At-the-Market Offering): A program allowing the company to sell new shares into the public markets incrementally at prevailing prices, providing flexible capital raising without large block offerings.
• Magnetar Opportunity 2025-4, LP: A special purpose vehicle established for investment in TensorWave Inc., enabling targeted exposure within SuRo Capital Corp.'s portfolio.
• CWO Opportunity II, LP: An entity holding Class A common shares of CoreWeave Inc., through which SuRo Capital Corp. maintains its investment in CoreWeave.

Full Conference Call Transcript

Mark Klein, and Chief Financial Officer, Allison Green. Please note that a slide presentation corresponding to today's prepared remarks by management is available on our website at www.surocap.com under Investor Relations, Events, Presentations. Today's call is being recorded and broadcast live on our website www.surocap.com. Replay information is included in our press release issued today. This call is the property of SuRo Capital Corp., and the unauthorized reproduction of this call in any form is strictly prohibited. I would also like to call your attention to customary disclosures in today's earnings press release regarding forward-looking information. Statements made in today's conference call and webcast may constitute forward-looking statements, relate to future events or our future performance or financial condition. These statements are not guarantees of our future performance or future financial condition or results, and involve a number of risks, estimates, and uncertainties including the impact of any market volatility that may be detrimental to our business, our portfolio companies, our industry, and the global economy, that could cause results to differ materially from the plans, intentions, and expectations reflected in or suggested by the forward-looking statements. Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including but not limited to, those described from time to time in the company's filings with the SEC. In addition, preliminary financial estimates regarding the company's estimated accretion to current net asset value provided herein have been prepared by and are the responsibility of the management of the company. This information is preliminary and is thus inherently uncertain and subject to change. Actual results relating to the company's net asset value for any period subsequent to 12/31/2025, including 03/31/2026, may differ materially. Management does not undertake to update such forward-looking statements unless required to do so by law. To obtain copies of SuRo Capital Corp.'s latest SEC filings, please visit our website at www.surocap.com or the SEC's website at www.sec.gov. I will now turn the call over to Mark Klein. Thank you, Jackson. Good afternoon, everyone, and thank you for joining us. This is an important moment for SuRo Capital Corp. We are entering 2026 with meaningful momentum across our portfolio, a disciplined investment strategy, substantial embedded value, and what we believe is a highly differentiated position in one of the most consequential technology cycles of our time. Before I review our full-year results, I want to begin with what has happened since year-end because those developments matter. They matter for our portfolio. They matter for how we see the opportunity ahead. And most importantly, they matter for our shareholders. Since the beginning of 2026, public markets have been mixed. Volatility has remained a feature of the environment. Sentiment has moved back and forth. But beneath the day-to-day noise, one much more important trend has continued to strengthen. The global buildout of AI infrastructure is accelerating. We do not view this as a passing theme. We do not view this as a short cycle. We view it as a structural shift in how the modern economy will be built. Across the largest technology platforms in the world, capital commitments continue to rise. That tells us something important. AI is no longer being treated as an experimental initiative. It is becoming core infrastructure. It is becoming central to how businesses compete, how they invest, and how they grow. And when capital begins moving at that scale, the effects extend far beyond the largest public companies. It benefits foundational infrastructure. It benefits enabling software. It benefits private companies building essential tools, platforms, and systems that support this transition. That is where SuRo Capital Corp. is positioned. Against that backdrop, we continue to see strong execution across our portfolio. Since the end of the year, several of our portfolio companies have completed or are in the process of finalizing significant financing. Based on indications available today, and assuming each of these financings close and the remainder of our portfolio remains as it was at the end of the 2025 valuation, we believe these financings could contribute at least $5.00 and as much as $6.50 per share to our current net asset value. This is Highlatan. And I want to underscore one point very clearly. As these developments arose in 2026, they are not reflected in our fourth quarter 2025 net asset value. So while our reported year-end NAV reflects a year of strong underlying performance, it does not yet capture what we believe is a meaningful amount of value creation that has already emerged clearly this year. Now because several of these transactions have not yet publicly been disclosed, there are limits to what we can share today. But the direction is clear. The progress is real. And as more of these developments become public, we expect to provide full context in our first quarter prerelease and earnings call. One financing that has been widely reported and one worth highlighting is OpenAI. This transaction was notable not only for its size, but for what it represents. It reflects the extraordinary scale of capital now being committed to AI development and to the infrastructure required to support it. It reflects the capital intensity of this next era of computing. And it reinforces the fact that AI has moved from possibility to priority. Moments like this help define markets. They show where strategic capital is flowing. They show where conviction is building. And they validate a core principle behind our strategy. Some of the most important value creation in technology happens while great businesses are still private. That is where we seek to invest. That is where we seek to build exposure. And that is where we believe SuRo Capital Corp. offers shareholders something distinct. As noted earlier, this financing occurred in 2026 and is therefore not reflected in our year-end NAV. More broadly, we continue to believe AI is a multiyear structural transformation that remains in its early stages. It is moving from research into deployment, from experimentation into integration, and from isolated use cases into broad commercial adoption. As that happens, the opportunity set continues to expand. Some companies will benefit directly by providing the infrastructure, compute, and tooling that make this shift possible. Others will benefit indirectly through increased demand for software, automation, data, and more efficient digital systems. We believe both dynamics matter. And we believe both are increasingly relevant across our portfolio. This is one of the reasons we remain constructive on the road ahead. Public markets offer investors exposure to many of the largest and most established beneficiaries of technological change. But by the time many of those companies are broadly owned, a meaningful share of the early value creation has already taken place. SuRo Capital Corp. is positioned differently. We provide public market investors access to venture-backed private companies earlier in their life cycles before broad public ownership and often before the full scale of their long-term potential is reflected in market value. That matters. Because early in a company's life, innovation can be sharper. Growth can be faster. Strategic advantage can be more pronounced. And when those companies execute, the value creation can be extraordinary. Our responsibility is to identify those businesses, invest carefully with discipline, remain patient where conviction is high, and realize gains thoughtfully when liquidity opportunities emerge. We do not chase noise. We do not allocate capital for appearances. We focus on quality. We focus on asymmetry, and we focus on long-term shareholder value. When we look back on 2025, we believe the results speak clearly. Our stock price increased from $5.88 per share at year-end 2024 to $9.44 at the end of 2025, an increase of over 60%. Including our $0.50 dividend per share declared and paid during the year, total shareholder return approximated 70%. That is a strong outcome. It reflects performance across the portfolio. It reflects disciplined capital allocation. And we believe it reflects increasing recognition of the value embedded in SuRo Capital Corp. Our net asset value also grew meaningfully. At the end of 2024, our NAV was $6.68. By the end of 2025, it had increased to $8.09, representing a year-over-year growth of approximately 21%. In addition, during 2025, we declared and paid $0.50 per share in cash dividends. On a dividend-adjusted basis, our 12/31/2025 NAV would have been $8.59 per share, representing a year-over-year growth of approximately 29%. Again, our reported year-end NAV does not include the previously referenced potential increases in value from the 2026 financings, which could contribute at least $5.00 per share and as much as $6.50 per share to our current net asset value. This is important because it reflects how we think about stewardship. We are committed not only to building value, but to realizing value. Not only to compounding capital, but to returning capital when appropriate. Our objective is straightforward: to create durable long-term value for shareholders and do so with discipline, transparency, and accountability. At the same time, we continue to invest with conviction where strongest. Our recent commitment to TensorWave is a good example. We believe TensorWave is operating in a part of the market that stands to benefit directly from one of the most powerful secular trends in technology: rising demand for AI compute. TensorWave has deployed what the company described at the time as the world's largest liquid-cooled AMD GPU cluster and has continued to expand the footprint, including through two additional 10-megawatt deployments in Arizona and Pennsylvania.

As customers seek performance, scale, and diversification in an increasingly important layer of the technology stack, we believe this company is well positioned. More broadly, we see further evidence of this trend in announcements such as Meta's recent multiyear agreement with AMD to support up to six gigawatts of AI infrastructure. This investment expands our exposure to AI infrastructure and reflects a broader principle that guides us. When the world is changing in a fundamental way, the companies enabling that change can become extraordinarily valuable. We intend to remain disciplined, but we also intend to be decisive when we see this kind of opportunity.

So when I look at where SuRo Capital Corp. stands today, I see a company with momentum in the portfolio, meaningfully embedded upside, a strong liquidity position, and a strategy aligned with some of the most important innovation trends in the global economy. We are confident in what we own. We are disciplined in how we invest. We are thoughtful in how we realize gains. We are clear about who we work for: our shareholders. Our mission is to give public market participants access to exceptional private companies before they become broadly owned and to convert that access into long-term shareholder value through disciplined execution over time. That is what we are building. That is what we are focused on.

And that is why we are excited about the road ahead. I will now turn the call over to Allison.

Allison Green: Thank you, Mark. I would like to follow Mark's update with a review of our investment activity and portfolio company realizations during the fourth quarter and subsequent year-end, a high-level review of our investment portfolio as of year-end, including the investment theme breakdown, and a more detailed review of our fourth quarter financial results including our current liquidity as of December 31. I will also touch on notable items during the fourth quarter and year-end, including our cash dividend, debt repurchases, capital raised and shares issued via the at-the-market offering, or ATM, program, and recent Board-approved updates to the note repurchase program and the share repurchase program.

Throughout the fourth quarter, we received distributions from CWO Opportunity II, LP following the lifting of sales restrictions on publicly traded CoreWeave stock held by the fund on 08/15/2025. CWO Opportunity II, LP is an entity for which the Class A membership interest is solely invested in the Class A common shares of CoreWeave Inc. SuRo Capital Corp. is invested in the Class A common shares of CoreWeave Inc. through its investment in the Class A membership interest of CWO Opportunity II, LP. We received three distributions during the fourth quarter totaling approximately $9,000,000 and categorized in aggregate as approximately $2,300,000 return of capital and $6,700,000 gain.

The aggregate fourth quarter distributions were approximately 15.3% of our $15,000,000 investment in CWO Opportunity II, LP. As of year-end, we continue to have exposure to CoreWeave through the remaining 68.1% of our initial investment in CWO Opportunity II, LP. On November 6, we sold our remaining 70,530 public common shares of Forge Global Inc. for net proceeds of approximately $3,100,000, resulting in a realized gain of approximately $1,100,000. The total realized gain on this investment is approximately $5,000,000. On October 16, SuRo Capital Corp. portfolio company Rebrick Inc., doing business under the name Compliable, approved a plan to dissolve the company. As a result, SuRo Capital Corp. realized a loss of approximately $1,000,000 on the position.

Finally, we received a distribution from True Global Ventures 4 Plus venture funds for approximately $137,000. As Mark mentioned, on December 31, SuRo Capital Corp. committed up to $20,000,000 to Magnetar Opportunity 2025-4, LP, a special purpose vehicle invested in TensorWave Inc. Subsequent to year-end, on January 2, SuRo Capital Corp. funded $5,000,000 of the $20,000,000 capital commitment. As of March 10, $5,000,000 of the $20,000,000 commitment to Magnetar Opportunity 2025-4, LP had been funded. The remaining commitment of up to $15,000,000 is subject to the status of certain conditions. Subsequent to year-end, we sold 106,580 common shares of Grab Digital Holdings Inc. following the removal of lockup restrictions on January 15.

These sales resulted in net proceeds of approximately $327,000 and a realized gain of approximately $214,000. As of March 10, we continue to hold 933,420 public common shares, or approximately 90% of our original position. Additionally, subsequent to year-end, we received an additional distribution from True Global Ventures 4 Plus venture funds for approximately $246,000. I would now like to turn to our portfolio as of year-end. Our top five positions as of December 31 were OpenAI, Whoop, Blink Health, Canva, and Learning Home. These positions accounted for approximately 54% of the portfolio at fair value. Additionally, as of December 31, our top 10 positions accounted for 80% of the investment portfolio.

Segmented by seven general investment themes, the top allocation of our investment portfolio at December 31 was to artificial intelligence infrastructure and applications, representing approximately 31% of the investment portfolio at fair value. Consumer goods and services and software-as-a-service were the next largest categories with approximately 21% and 20% of our portfolio, respectively. Approximately 11% of our portfolio was invested in education technology companies. The financial technology and services segment comprised approximately 8% of the fair value of our portfolio. The logistics and supply chain category accounted for approximately 8% of the fair value of our portfolio, and SuRo Sports accounted for 2% as of December 31.

We ended the fourth quarter and fiscal year 2025 with a net asset value of approximately $205,300,000, or $8.09 per share, consistent with our financial reporting. The decrease in NAV per share from $9.23 at the end of Q3 was primarily driven by a $0.84 per share decrease from the net change in unrealized depreciation of our investments, a $0.25 per share decrease from the impact of dividends declared and paid during the quarter, a $0.22 per share decrease due to net investment loss, and a $0.10 per share decrease related to stock-based compensation. The decrease in NAV per share was offset by a $0.27 per share increase resulting from the net realized gain on our investments during the quarter.

During Q4, we sold 6,595 shares under the ATM program at a weighted average price of $9.80 per share, for gross proceeds of approximately $65,000 and net proceeds of approximately $53,000 after deducting commissions to the agents on shares sold. As of year-end, up to approximately $87,900,000 in aggregate amount of the shares remain available for sale under the ATM program.

Allison Green: On October 29, SuRo Capital Corp.'s Board of Directors approved an extension of the discretionary note repurchase program, which allows us to repurchase up to an additional $40,000,000, or the remaining aggregate principal amount of our 6% notes due 2026, through open market purchases, including block purchases, in such manner as will comply with the provisions of the Investment Company Act of 1940, as amended, and the Securities Exchange Act of 1934, as amended. Subsequent to this approval, during the quarter, we repurchased an additional 153,513 of the 6% notes due 2026 under the note repurchase program.

As of December 31, we have repurchased 1,566,807, or approximately $39,200,000 in aggregate principal dollar amount of the 6% notes due 2026 under the note repurchase program for approximately $38,900,000 inclusive of broker commission. This represents approximately 52% of the original total issuance. The aggregate principal dollar amount of 6% notes that may yet be repurchased by SuRo Capital Corp. under the note repurchase program is approximately $35,800,000. As Mark mentioned earlier, SuRo Capital Corp. is committed to initiatives that enhance shareholder value.

As such, on October 29, our Board of Directors authorized an extension of the company's discretionary share repurchase program until the earlier of 10/31/2026, or the repurchase of $64,300,000 in aggregate amount of the company's common stock, of which $25,000,000 remains available for future repurchases. Additionally, on November 3, SuRo Capital Corp.'s Board of Directors declared a cash dividend of $0.25 per share paid on December 5 to the company's common stockholders of record as of the close of business on November 21. This dividend was generally attributable to the successful monetizations of public securities and other promising developments in our investment portfolio.

The date of declaration and amount of any dividends or distributions, including any future distributions, are subject to the sole discretion of SuRo Capital Corp.'s Board of Directors. Aggregate amount of distributions declared and paid by SuRo Capital Corp. will be fully taxable to stockholders. The federal income tax classification of SuRo Capital Corp.'s 2025 distributions has been determined to be capital gains. SuRo Capital Corp. reports the tax characteristics of each year's distributions annually to stockholders and the IRS on Form 1099-DIV.

Subsequent to year-end, as a result of the $0.25 per share cash dividend paid on December 5 to stockholders of record as of the close of business on November 21, effective as of November 21, the conversion rate applicable to the 6.5% convertible notes due 2029 adjusted to $7.32 per share from the prior conversion price of $7.53 per share, which had been in effect since July 2021. The adjustment to the conversion rate of the 6.5% convertible notes due 2029 was made pursuant to the note purchase agreement governing the 6.5% convertible notes due 2029. At December 31, there were 25,377,756 shares of the company's common stock outstanding.

Allison Green: Finally, regarding our liquidity as of year-end, we ended the year with approximately $50,100,000 of liquid assets, including approximately $49,000,000 in cash and approximately $1,100,000 in unrestricted public securities.

Allison Green: Not included in our unrestricted public securities are approximately $17,800,000 of public securities subject to lockup or other sales restrictions as of year-end. This represents our remaining investment in CoreWeave via our Class A interest of CWO Opportunity II, LP and the public common shares of Grab that became unrestricted subsequent to year-end. That concludes my comments. We would like to thank you for your interest and support of SuRo Capital Corp. Now I will turn the call over to the operator to start the Q&A session. Operator?

Operator: Thank you. To participate in the Q&A on today's call, please press “*1” on your telephone keypad. And please limit yourself to one question per person. You will be advised when to ask your question. We will take our first question from Alexander Paris, Barrington Research. Your line is open. Please go ahead.

Alexander Paris: Hi, guys. Thanks for taking my—2025, sorry.

Mark Klein: Alex, you are kinda cutting in and out.

Alexander Paris: Oh, I am sorry. Let me switch. Can you hear me?

Mark Klein: Yes. All good. Go ahead.

Alexander Paris: Okay. Good. So my question will be related to the $5.00 to $6.50 per share expected as a result of financings either completed or being finalized. I know you said in your prepared comments you cannot talk about which portfolio companies other than OpenAI, which is in the public realm. But my question relates to timeline. How much do you expect to be completed in Q1? And then how much do you expect to be completed between Q1 and the rest of 2026, just on the basis of $5.00 to $6.50 a share?

Mark Klein: Yeah. So, unfortunately, because of certain restrictions we cannot really discuss it. But we believe that they will all be completed certainly by the end of the quarter. That does not mean that they will be necessarily announced by the companies that are completing the financings.

Operator: We will take our next question from Brian McKenna of Citizens Bank. Your line is open. Please go ahead.

Nate Sauer: Yeah. Hi, guys. This is Nate Sauer on for Brian. Thanks for taking my question. So I kinda also want to look a little bit at that $5.00 to $6.50. And, I guess speaking a little bit more broadly, some of the drivers you guys are seeing there? So I know you mentioned OpenAI and you mentioned a little bit around that. But I guess, more broadly, what are some things that are kind of leading to appreciation that extreme? And are there things you are seeing across your entire portfolio? Or is it a little bit more concentrated?

And then I guess on the other side of that, are there any offsets that we should maybe be aware of given that we are now already in March?

Mark Klein: No problem. Thank you. So there have been multiple financings that have either occurred or are occurring and have not necessarily been announced. Obviously, when you have drivers of that type of magnitude, there are significant portfolio positions that are driving that. As to what we are seeing around our other portfolio, I think market conditions, which drive market multiples, will have some impact on other parts of our portfolio.

Operator: We will take our next question from Alex Fuhrman, Lucid Capital. Your line is open. Please go ahead. Great. Thanks very much for taking my question, and congratulations on a really strong year in 2025. Can you help us just kind of level set some of the less exciting parts of the model for this year? That is very exciting that there could be some pretty substantial near-term appreciation in the NAV. What are kind of some base-case numbers we should be thinking about, given the portfolio you have this year, for, say, investment income and just operating expenses on a quarterly basis given how much you have grown the portfolio?

Allison Green: Sure. Thanks. So to start with, and thank you for your kind words, 2024 was a really good year. 2025, as we have spoken about essentially now over the last twenty minutes, is starting out to be extraordinary. As to the specific questions, we do not really generate income outside of realized capital gains, as you know. And our operating expenses have been pretty static over the last two years, and we would not expect them to be significantly different at all.

Operator: We will take our next question from Marvin Fong, BTIG. Your line is open. Please go ahead.

Marvin Fong: Great. Hi, Mark. Hi, Allison. Let me add my congratulations as well on all the great progress here. My question is on the latest investment in TensorWave—and not so much on TensorWave itself—but the $20,000,000 commitment, I believe, is one of your largest ever, more than OpenAI, in fact. And I understand that rounds are getting larger. But could you just kind of comment on whether this was sort of a special case? Or do you feel like your regular size will be increasing, or is this sort of that appetite focused primarily on AI? Just kind of help us understand the dynamics there. Thank you.

Mark Klein: Thanks, Marvin, and thanks for the kind words, and good question. What we saw in TensorWave is an opportunity to invest on the AMD side of the chipset as opposed to the NVIDIA side, which we saw in a structure that allows us to invest a little bit and, upon certain obligations being fulfilled that would be extremely valuing to TensorWave and to the investment, to have a springing effect in our investment.

So we got very excited to be able to be in early with a company that is fully aligned with AMD with AMD's full support, and do it in a way that limits our initial exposure till things prove out in the way that we think, and then make it a significant investment. I do not think it speaks necessarily to all of our investments being $20,000,000, obviously, given the size of the portfolio. But it does speak to our feeling that this is an opportunity that we wanted to lean into more fully.

Operator: We will take our next question from John Hickman, Ladenburg. Your line is open. Please go ahead. Hi. So, Mark, could you give us some comments about your thoughts on private market valuations versus what is going on the public side? Like, you know, some of the public companies that are building out AI stuff are not getting the kind of valuations that appear to be happening on the private side.

Mark Klein: So, John, I will zoom out a little bit. We spent an awful lot of time looking at this internally because—and I think we probably talked about it on our last earnings call—the acceleration in pricing and the acceleration in rounds that are occurring is pretty unprecedented. We went back and looked at the 2019–2021 time to see the acceleration of valuation and the rapid levels of capital raises. And we looked back at the effectively public venture market, which was 1999 to 2001, to sort of see where we sit relative to what has gone on historically.

And what is clear is that the rapid nature of the incline of the growth of value and the rapid amount of consistent raises is more akin to 1999 to 2001. And you are seeing separation now from what the public valuations are versus the private valuations. Clearly, the acceleration in the private markets has exceeded what is going on in the public markets. Thank you.

Operator: There are no further questions on the line. I will now hand you back to your speaker for closing remarks.

Mark Klein: Well, thank you all for taking the time to visit with us today. I hope that you are as excited about what is going on in SuRo Capital Corp. as our team is. It was an exciting year last year. This year has started out to be even more exciting than last year. There are a lot of things for us to be doing. I think we are taking advantage of it. And the whole team is looking forward to 2026 and the years to come. Thank you all very much.

Operator: Thank you for joining today's call. You may now disconnect. Welcome to the SuRo Capital Corp. Fourth Quarter and Fiscal Year 2025 Earnings Call. My name is Alan, and I will be your coordinator for today's event. Please note this call is being recorded. For the duration, your lines will be on listen-only. However, you will have the opportunity to ask questions at the end. This can be done by pressing “*1” on your telephone keypad. If you require assistance at any time, please press “*0,” and you will be connected to an operator. I will now hand your host, Jackson Stone, the line to begin today's conference. Thank you.

Jackson Stone: Thank you for joining us on today's call. I am joined today by the Chairman and Chief Executive Officer of SuRo Capital Corp., Mark Klein, and Chief Financial Officer, Allison Green. Please note that a slide presentation corresponding to today's prepared remarks by management is available on our website at www.surocap.com under Investor Relations, Events, Presentations. Today's call is being recorded and broadcast live on our website www.surocap.com. Replay information is included in our press release issued today. This call is the property of SuRo Capital Corp., and the unauthorized reproduction of this call in any form is strictly prohibited. I would also like to call your attention to customary disclosures in today's earnings press release regarding forward-looking information.

Statements made in today's conference call and webcast may constitute forward-looking statements, relate to future events or our future performance or financial condition. These statements are not guarantees of our future performance or future financial condition or results, and involve a number of risks, estimates, and uncertainties including the impact of any market volatility that may be detrimental to our business, our portfolio companies, our industry, and the global economy, that could cause results to differ materially from the plans, intentions, and expectations reflected in or suggested by the forward-looking statements.

Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including but not limited to, those described from time to time in the company's filings with the SEC. In addition, the preliminary financial estimates regarding the company's estimated accretion to current net asset value provided herein have been prepared by and are the responsibility of the management of the company. This information is preliminary and is thus inherently uncertain and subject to change. Actual results relating to the company's net asset value for any period subsequent to 12/31/2025, including 03/31/2026, may differ materially. Management does not undertake to update such forward-looking statements unless required to do so by law.

To obtain copies of SuRo Capital Corp.'s latest SEC filings, please visit our website at www.surocap.com or the SEC's website at www.sec.gov. Now I would like to turn the call over to Mark Klein.

Mark Klein: Thank you, Jackson. Good afternoon, everyone, and thank you for joining us. This is an important moment for SuRo Capital Corp. We are entering 2026 with meaningful momentum across our portfolio, a disciplined investment strategy, substantial embedded value, and what we believe is a highly differentiated position in one of the most consequential technology cycles of our time. Before I review our full-year results, I want to begin with what has happened since year-end because those developments matter. They matter for our portfolio. They matter for how we see the opportunity ahead. And most importantly, they matter for our shareholders. Since the beginning of 2026, public markets have been mixed. Volatility has remained a feature of the environment.

Sentiment has moved back and forth. But beneath the day-to-day noise, one much more important trend has continued to strengthen. The global buildout of AI infrastructure is accelerating. We do not view this as a passing theme. We do not view this as a short cycle. We view it as a structural shift in how the modern economy will be built. Across the largest technology platforms in the world, capital commitments continue to rise. That tells us something important. AI is no longer being treated as an experimental initiative. It is becoming core infrastructure. It is becoming central to how businesses compete, how they invest, and how they grow.

And when capital begins moving at that scale, the effects extend far beyond the largest public companies. It benefits foundational infrastructure. It benefits enabling software. It benefits private companies building essential tools, platforms, and systems that support this transition. That is where SuRo Capital Corp. is positioned. Against that backdrop, we continue to see strong execution across our portfolio. Since the end of the year, several of our portfolio companies have completed or are in the process of finalizing significant financing.

Based on indications available today, and assuming each of these financings close and the remainder of our portfolio remains as it was at the end of the 2025 valuation, we believe these financings could contribute at least $5.00 and as much as $6.50 per share to our current net asset value. This is Highlatan. And I want to underscore one point very clearly. As these developments arose in 2026, they are not reflected in our fourth quarter 2025 net asset value. So while our reported year-end NAV reflects a year of strong underlying performance, it does not yet capture what we believe is a meaningful amount of value creation that has already emerged clearly this year.

Now because several of these transactions have not yet publicly been disclosed, there are limits to what we can share today. But the direction is clear. The progress is real. And as more of these developments become public, we expect to provide full context in our first quarter prerelease and earnings call. One financing that has been widely reported and one worth highlighting is OpenAI. This transaction was notable not only for its size, but for what it represents. It reflects the extraordinary scale of capital now being committed to AI development and to the infrastructure required to support it. It reflects the capital intensity of this next era of computing.

And it reinforces the fact that AI has moved from possibility to priority. Moments like this help define markets. They show where strategic capital is flowing. They show where conviction is building. And they validate a core principle behind our strategy. Some of the most important value creation in technology happens while great businesses are still private. That is where we seek to invest. That is where we seek to build exposure. And that is where we believe SuRo Capital Corp. offers shareholders something distinct. As noted earlier, this financing occurred in 2026 and is therefore not reflected in our year-end NAV. More broadly, we continue to believe AI is a multiyear structural transformation that remains in its early stages.

It is moving from research into deployment, from experimentation into integration, and from isolated use cases into broad commercial adoption. As that happens, the opportunity set continues to expand. Some companies will benefit directly by providing the infrastructure, compute, and tooling that make this shift possible. Others will benefit indirectly through increased demand for software, automation, data, and more efficient digital systems. We believe both dynamics matter. And we believe both are increasingly relevant across our portfolio. This is one of the reasons we remain constructive on the road ahead. Public markets offer investors exposure to many of the largest and most established beneficiaries of technological change.

But by the time many of those companies are broadly owned, a meaningful share of the early value creation has already taken place. SuRo Capital Corp. is positioned differently. We provide public market investors access to venture-backed private companies earlier in their life cycles before broad public ownership and often before the full scale of their long-term potential is reflected in market value. That matters. Because early in a company's life, innovation can be sharper. Growth can be faster. Strategic advantage can be more pronounced. And when those companies execute, the value creation can be extraordinary.

Our responsibility is to identify those businesses, invest carefully with discipline, remain patient where conviction is high, and realize gains thoughtfully when liquidity opportunities emerge. We do not chase noise. We do not allocate capital for appearances. We focus on quality. We focus on asymmetry, and we focus on long-term shareholder value. When we look back on 2025, we believe the results speak clearly. Our stock price increased from $5.88 per share at year-end 2024 to $9.44 at the end of 2025. An increase of over 60%. Including our $0.50 dividend per share declared and paid during the year, total shareholder return approximated 70%. That is a strong outcome. It reflects performance across the portfolio.

It reflects disciplined capital allocation, and we believe it reflects recognition of the value embedded in SuRo Capital Corp. Our net asset value also grew meaningfully. At the end of 2024, our NAV was $6.68. By the end of 2025, it had increased to $8.09, representing a year-over-year growth of approximately 21%. In addition, during 2025, we declared and paid $0.50 per share in cash dividends. On a dividend-adjusted basis, our 12/31/2025 NAV would have been $8.59 per share, representing a year-over-year growth of approximately 29%.

Again, our reported year-end NAV does not include the previously referenced potential increases in value from the 2026 financings, which could contribute at least $5.00 per share and as much as $6.50 per share to our current net asset value. This is important because it reflects how we think about stewardship. We are committed not only to building value, but to realizing value. Not only to compounding capital, but to returning capital when appropriate. Our objective is straightforward. To create durable long-term value for shareholders and do so with discipline, transparency, and accountability. At the same time, we continue to invest with conviction where strongest. Our recent commitment to TensorWave is a good example.

We believe TensorWave is operating in a part of the market that stands to benefit directly from one of the most powerful secular trends in technology: rising demand for AI compute. TensorWave has deployed what the company described at the time as the world's largest liquid-cooled AMD GPU cluster and has continued to expand the footprint, including through two additional 10-megawatt deployments in Arizona and Pennsylvania. As customers seek performance, scale, and diversification in an increasingly important layer of the technology stack, we believe this company is well positioned.

Mark Klein: Broadly, we see further evidence of this trend in announcements such as Meta's recent multiyear agreement with AMD to support up to six gigawatts of AI infrastructure. This investment expands our exposure to AI infrastructure and reflects a broader principle that guides us. When the world is changing in a fundamental way, the companies enabling that change can become extraordinarily valuable. We intend to remain disciplined, but we also intend to be decisive when we see this kind of opportunity.

So when I look at where SuRo Capital Corp. stands today, I see a company with momentum in the portfolio, meaningfully embedded upside, a strong liquidity position, and a strategy aligned with some of the most important innovation trends in the global economy. We are confident in what we own. We are disciplined in how we invest. We are thoughtful in how we realize gains. We are clear about who we work for. Our shareholders. Our mission is to give public participants access to exceptional private companies before they become broadly owned and to convert that access into long-term shareholder value through disciplined execution over time. That is what we are building. That is what we are focused on.

And that is why we are excited about the road ahead. I will now turn the call over to Allison.

Allison Green: Thank you, Mark. I would like to follow Mark's update with a review of our investment activity and portfolio company realizations during the fourth quarter and subsequent year-end, a high-level review of our investment portfolio as of year-end, including the investment theme breakdown, and a more detailed review of our fourth quarter financial results including our current liquidity as of December 31. I will also touch on notable items during the fourth quarter and year-end, including our cash dividend, debt repurchases, capital raised and shares issued via the at-the-market offering, or ATM, program, and recent Board-approved updates to the note repurchase program and the share repurchase program.

Throughout the fourth quarter, we received distributions from CWO Opportunity II, LP following the lifting of sales restrictions on the publicly traded CoreWeave stock held by the fund on 08/15/2025. CWO Opportunity II, LP is an entity for which the Class A membership interest is solely invested in the Class A common shares of CoreWeave Inc. SuRo Capital Corp. is invested in the Class A common shares of CoreWeave Inc. through its investment in the Class A membership interest of CWO Opportunity II, LP. We received three distributions during the fourth quarter totaling approximately $9,000,000 and were categorized in aggregate as approximately $2,300,000 return of capital and $6,700,000 gain.

The aggregate fourth quarter distributions were approximately 15.3% of our $15,000,000 investment in CWO Opportunity II, LP. As of year-end, we continue to have exposure to CoreWeave through the remaining 68.1% of our initial investment in CWO Opportunity II, LP. On November 6, we sold our remaining 70,530 public common shares of Forge Global Inc. for net proceeds of approximately $3,100,000, resulting in a realized gain of approximately $1,100,000. The total realized gain on this investment is approximately $5,000,000. On October 16, SuRo Capital Corp. portfolio company Rebrick Inc., doing business under the name Compliable, approved a plan to dissolve the company. As a result, SuRo Capital Corp. realized a loss of approximately $1,000,000 on the position.

Finally, we received a distribution from True Global Ventures 4 Plus venture funds for approximately $137,000. As Mark mentioned, on December 31, SuRo Capital Corp. committed up to $20,000,000 to Magnetar Opportunity 2025-4, LP, a special purpose vehicle invested in TensorWave Inc. Subsequent to year-end, on January 2, SuRo Capital Corp. funded $5,000,000 of the $20,000,000 capital commitment. As of March 10, $5,000,000 of the $20,000,000 commitment to Magnetar Opportunity 2025-4, LP had been funded. The remaining commitment of up to $15,000,000 is subject to the status of certain conditions. Subsequent to year-end, we sold 106,580 common shares of Grab Digital Holdings Inc. following the removal of lockup restrictions on January 15.

These sales resulted in net proceeds of approximately $327,000 and a realized gain of approximately $214,000. As of March 10, we continue to hold 933,420 public common shares, or approximately 90% of our original position. Additionally, subsequent to year-end, we received an additional distribution from True Global Ventures 4 Plus venture funds for approximately $246,000. I would now like to turn to our portfolio as of year-end. Our top five positions as of December 31 were OpenAI, Whoop, Blink Health, Canva, and Learning Home. These positions accounted for approximately 54% of the investment portfolio at fair value. Additionally, as of December 31, our top 10 positions accounted for 80% of the investment portfolio.

Segmented by seven general investment themes, the top allocation of our investment portfolio at December 31 was to artificial intelligence infrastructure and applications, representing approximately 31% of the investment portfolio at fair value. Consumer goods and services and software-as-a-service were the largest categories with approximately 21% and 20% of our portfolio, respectively. Approximately 11% of our portfolio was invested in education technology companies. The financial technology and services segment comprised approximately 8% of the fair value of our portfolio. The logistics and supply chain category accounted for approximately 8% of the fair value of our portfolio, and SuRo Sports accounted for 2% as of December 31.

We ended the fourth quarter and fiscal year 2025 with a net asset value of approximately $205,300,000, or $8.09 per share, consistent with our financial reporting. The decrease in NAV per share from $9.23 at the end of Q3 was primarily driven by a $0.84 per share decrease from the net change in unrealized depreciation of our investments, a $0.25 per share decrease from the impact of dividends declared and paid during the quarter, a $0.22 per share decrease due to net investment loss, and a $0.10 per share decrease related to stock-based compensation. The decrease in NAV per share was offset by a $0.27 per share increase resulting from the net realized gain on our investments during the quarter.

During Q4, we sold 6,595 shares under the ATM program at a weighted average price of $9.80 per share, for gross proceeds of approximately $55,000 and net proceeds of approximately $53,000 after deducting commissions to the agents on shares sold. As of year-end, up to approximately $87,900,000 in aggregate amount of the shares remain available for sale under the ATM program.

On October 29, SuRo Capital Corp.'s Board of Directors approved an extension of the discretionary note repurchase program, which allows us to repurchase up to an additional $40,000,000, or the remaining aggregate principal amount of our 6% notes due 2026, through open market purchases, including block purchases, in such manner as will comply with the provisions of the Investment Company Act of 1940, as amended, and the Securities Exchange Act of 1934, as amended. Subsequent to this approval, during the quarter, we repurchased an additional 153,513 of the 6% notes due 2026 under the note repurchase program.

As of December 31, we have repurchased 1,566,807, or approximately $39,200,000 in aggregate principal dollar amount of the 6% notes due 2026, under the note repurchase program for approximately $38,900,000 inclusive of broker commission. This represents approximately 52% of the original total issuance. The aggregate principal dollar amount of 6% notes that may yet be repurchased by SuRo Capital Corp. under the note repurchase program is approximately $35,800,000. As Mark mentioned earlier, SuRo Capital Corp. is committed to initiatives that enhance shareholder value.

As such, on October 29, our Board of Directors authorized an extension of the company's discretionary share repurchase program until the earlier of 10/31/2026, or the repurchase of $64,300,000 in aggregate amount of the company's common stock, of which $25,000,000 remains available for future repurchases. Additionally, on November 3, SuRo Capital Corp.'s Board of Directors declared a cash dividend of $0.25 per share paid on December 5 to the company's common stockholders of record as of the close of business on November 21. This dividend was generally attributable to the successful monetizations of public securities and other promising developments in our investment portfolio.

The date of declaration and amount of any dividends or distributions, including any future distributions, are subject to the sole discretion of SuRo Capital Corp.'s Board of Directors. Aggregate amount of distributions declared and paid by SuRo Capital Corp. will be fully taxed to stockholders. The federal income tax classification of SuRo Capital Corp.'s 2025 distributions has been determined to be capital gain. SuRo Capital Corp. reports the tax characteristics of each year's distributions annually to stockholders and the IRS on Form 1099-DIV.

Subsequent to year-end, as a result of the $0.25 per share cash dividend paid on December 5 to stockholders of record as of the close of business on November 21, effective as of November 21, the conversion rate applicable to the 6.5% convertible notes due 2029 adjusted to $7.32 per share from the prior conversion price of $7.53 per share, which had been in effect since July 2021. The adjustment to the conversion rate of the 6.5% convertible notes due 2029 was made pursuant to the note purchase agreement governing the 6.5% convertible notes due 2029. At December 31, there were 25,377,756 shares of the company's common stock outstanding.

Allison Green: Finally, regarding our liquidity as of year-end, we ended the year with approximately $50,100,000 of liquid assets, including approximately $49,000,000 in cash and approximately $1,100,000 in unrestricted public securities. Not included in our unrestricted public securities are approximately $17,800,000 of public securities subject to lockup or other sales restrictions as of year-end. This represents our remaining investment in CoreWeave via our Class A interest in CWO Opportunity II, LP and the public common shares of Grab that became unrestricted subsequent to year-end. That concludes my comments. We would like to thank you for your interest and support of SuRo Capital Corp. Now I will turn the call over to the operator to start the Q&A session. Operator?

Operator: Thank you. To participate in the Q&A on today's call, please press “*1” on your telephone keypad. And please limit yourself to one question per person. You will be advised when to ask your question. We will take our first question from Alexander Paris, Barrington Research. Your line is open. Please go ahead.

Alexander Paris: Hi, guys. Thanks for taking my—2025, sorry.

Mark Klein: Alex, you are kinda cutting in and out.

Alexander Paris: Oh, I am sorry. Let me switch. Can you hear me?

Mark Klein: Yeah. All good. Go ahead.

Alexander Paris: Okay. Good. So my question will be related to the $5.00 to $6.50 per share expected as a result of financings either completed or being finalized. I know you said in your prepared comments you cannot talk about which portfolio companies other than OpenAI, which is in the public realm. But my question relates to timeline. How much do you expect to be completed in Q1? And then how much do you expect to be completed between Q1 and 2026, just on the basis of $5.00 to $6.50 a share?

Mark Klein: So, unfortunately, because of certain restrictions we cannot really discuss it. But we believe that they will all be completed certainly by the end of the quarter. That does not mean that they will be necessarily announced by the companies that are completing the financings.

Operator: We will take our next question from Brian McKenna of Citizens Bank. Your line is open. Please go ahead.

Nate Sauer: Yeah. Hi, guys. This is Nate Sauer on for Brian. Thanks for taking my question. So I kinda also want to look a little bit at that $5.00 to $6.50. And I guess speaking a little bit more broadly, some of the drivers you guys are seeing there? So I know, you know, you mentioned OpenAI, and you mentioned a little bit around that. But I guess, more broadly, what are some things that are kind of leading to appreciation that extreme? And are they things you are seeing across your entire portfolio? Or is it a little bit more concentrated?

And then I guess on the other side of that, are there any offsets that we should maybe be aware of given that we are now already in March?

Mark Klein: No problem. Thank you. So there have been multiple financings that have either occurred or are occurring and have not necessarily been announced. Obviously, when you have drivers of that type of magnitude, there are significant portfolio positions that are driving that. As to what we are seeing around our other portfolio, I think market conditions, which drive market multiples, will have some impact on other parts of our portfolio.

Operator: We will take our next question from Alex Fuhrman, Lucid Capital. Your line is open. Please go ahead.

Alex Fuhrman: Great. Thanks very much for taking my question, and congratulations on a really strong year in 2025. Can you help us just kind of level set some of the less exciting parts of the model for this year? That is very exciting that, you know, there could be some pretty substantial near-term appreciation in the NAV. What are kind of some base-case numbers we should be thinking about given the portfolio you have this year, for, say, investment income and just operating expenses on a quarterly basis given how much you have grown the portfolio?

Allison Green: Sure. Thanks. So to start with, and thank you for your kind words. 2024 was a really good year. 2025, as we have spoken about essentially now over the last twenty minutes, is starting out to be extraordinary. As to the specific questions, we do not really generate income outside of realized capital gains, so we do not have a yield bill, as you know. And our operating expenses have been pretty static over the last two years, and we would not expect them to be significantly different at all.

Operator: We will take our next question from Marvin Fong, BTIG. Your line is open. Please go ahead.

Marvin Fong: Great. Hi, Mark. Hi, Allison. Let me add my congratulations as well on all the great progress here. My question is on the latest investment in TensorWave, and not so much on TensorWave itself, but the $20,000,000 commitment, I believe, is one of your largest ever—more than OpenAI, in fact. And I understand that rounds are getting larger. But could you just kind of comment on whether this was sort of a special case? Or do you feel like your regular size will be increasing, or is this sort of that appetite focused primarily on AI? Just kind of help us understand the dynamics there. Thank you.

Mark Klein: Thanks, Marvin, and thanks for the kind words, and good question. What we saw in TensorWave is an opportunity to invest on the AMD side of the chips as opposed to the NVIDIA side. But we saw it in a structure that allows us to invest a little bit and, upon certain obligations being fulfilled that would be extremely value-enhancing to TensorWave and to the investment, to have a springing effect in our investment.

So we got very excited to be able to be in early with a company that is fully aligned with AMD, with AMD's full support, and do it in a way that limits our initial exposure till things prove out in the way that we think, and then make it a significant investment. I do not think it speaks necessarily to all of our investments being $20,000,000, obviously, given the size of the portfolio. But it does speak to our feeling that this is an opportunity that we wanted to lean into more fully.

Operator: We will take our next question from John Hickman, Ladenburg. Your line is open. Please go ahead. So, Mark, could you give us some comments about your thoughts on private market valuations versus what is going on the public side? Like, you know, some of the public companies that are building out AI stuff are not getting the kind of valuations that appear to be happening on the private side.

Mark Klein: So, John, I will zoom out a little bit. We spent an awful lot of time looking at this internally because—and I think we probably talked about it on our last earnings call—the acceleration in price and the acceleration in rounds that are occurring is pretty unprecedented. We went back and looked at the 2019–2021 time to see the acceleration of valuation and the rapid levels of capital raises. And we looked back at the effectively public venture market, which was 1999 to 2001, to sort of see where we sit relative to what has gone on historically.

And what is clear is that the rapid nature of the growth of value and the rapid amount of consistent raises is more akin to 1999 to 2001. And you are seeing separation now from what the public valuations are versus private valuations. Clearly, the acceleration in the private markets has exceeded what is going on in the public markets. Thank you.

Operator: There are no further questions on the line. I will now hand you back to your speaker for closing remarks.

Mark Klein: Well, thank you all for taking the time to visit with us today. I hope that you are as excited about what is going on in SuRo Capital Corp. as our team is. It was an exciting year last year. This year has started out to be even more exciting than last year. There are a lot of things for us to be doing. I think we are taking advantage of it, and the whole team is looking forward to 2026 and the years to come. Thank you all very much.

Operator: Thank you for joining today's call. You may now disconnect.

This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. Parts of this article were created using Large Language Models (LLMs) based on The Motley Fool's insights and investing approach. It has been reviewed by our AI quality control systems. Since LLMs cannot (currently) own stocks, it has no positions in any of the stocks mentioned. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability.

The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.