Financial Contradictions Unveiled: Analyzing Key Discrepancies in 2025 Q1 and Q2 Earnings Calls

Net Investment Income and Net Asset Value Decline:
- Oxford Square Capital Corp. reported a net investment income of approximately $5.5 million or $0.08 per share for Q2 2025, a decrease from the $6.1 million or $0.09 per share in the prior quarter.
- The company's net asset value per share stood at $2.06, down from $2.09 in the prior quarter.
- The decline was attributed to combined net unrealized and realized losses on investments of approximately $1.1 million or $0.01 per share in Q2 2025, compared to $14.2 million or $0.20 per share in the prior quarter.

U.S. Loan Market Performance Improvement:
- U.S. loan prices, as defined by the Morningstar LSTA U.S. Leveraged Loan Index, increased from 96.31% of par in March to 97.07% of par in June 2025.
- The default rate increased to 1.11% by principal amount, but the distress ratio ended the quarter at 3.06%, down from 3.21% in March.
- The improvement in loan market performance was driven by increased demand and better pricing dispersion among BB, B, and CCC-rated loans.

Funding and Portfolio Management Strategies:
- Oxford Square issued approximately 4.9 million shares of common stock, resulting in net proceeds of $11.6 million, and announced a public offering of $65 million in 7.75% unsecured notes due 2030.
- The company's investment activity consisted mainly of repayments, with a focus on long-term portfolio management strategies.
- These actions were taken to maximize long-term total return as a permanent capital vehicle, reflecting the company's longer-term view on its investment strategy.