Goldman Sachs BDC, Inc. Q3 FY2025 earnings call

• The M&A market was resilient in Q3 2025 with dollar volumes 40.9% higher year-over-year, attributed to risk-on sentiment, lower borrowing costs, etc. - GSBD had new investment commitments at the highest level since 2022 integration, 100% in first lien loans; portfolio repayments of $374.4 million, with 86% from pre-2022 investments. - Proactive dividend policy adjustment to position for lower yield environment. - Proximity to Goldman Sachs investment banking franchise is a competitive advantage. - Monitored broader credit dynamics, AI investment risks with proprietary framework. - Third quarter net income per share $0.40, NAV per share $12.75; adjusted NAV per share $12.71. - Issued $400 million of 5-year investment grade unsecured note with 5.65% coupon and hedged it.

Net investment income per share for the quarter was $0.40 and net asset value per share was $12.75 as of quarter end. Total investments at fair value were $3.2 billion as of September 30, 2025, comprising 98.2% in senior secured loans, 1.5% in a combination of preferred and common stock, and a negligible amount in warrants. New investment commitments during the quarter reached $470.6 million across 27 portfolio companies, and repayments for the quarter were $374.4 million. The weighted average yield of debt and income-producing investments at amortized cost at the end of the third quarter was 10.3%, down from 10.7% at the end of the second quarter.

• Base rate cuts expected through year-end into 2026 to accelerate deal activity. - Adjusted dividend policy to be well-positioned in lower yield environment. - Board declared third quarter supplemental dividend of $0.04 per share and fourth quarter base dividend of $0.32 per share.

• Broader credit dynamics with idiosyncratic issues. - Concerns about tariffs, companies' ability to service debt, and risks in software investing, particularly AI.

Q: Thoughts on sustaining M&A activity into next year and whether it's a short-term or longer-term trend?

A: Vivek Bantwal thinks this is the start of a longer-term trend due to dry powder in private equity, risk-on sentiment, and strategic activity in sponsor and corporate communities.

Q: How much increase in activity needed for spreads to widen?

A: David Miller says not anticipating meaningful spread widening in the near term, but the platform has unique originations for higher spreads.

Q: Performance of Dental Brands on nonaccrual?

A: David Miller says it's a tiny position, been in the portfolio for some time, a more senior tranche was put on nonaccrual, and overall nonaccruals are stable.