Great Elm Posts Revenue Drop, Navigates $14M in Unrealized Losses

Date of Call: Feb 5, 2026

Financials Results

• Revenue: $3 million, down from $3.5 million in the prior year period

Business Commentary:

Unrealized Losses and Market Volatility:

• Great Elm Group recorded significant unrealized losses of $14.4 million during the quarter, primarily driven by market-based valuation movements.
• This was due to heightened volatility and pressure on public valuations, impacting investments in GECC Common Stock, related SPVs, and CoreWeave.

Liquidity and Balance Sheet Strength:

• The company maintained strong liquidity with approximately $51.2 million in cash on hand as of December 31, 2025.
• This liquidity provides ample flexibility to support growth initiatives and invest opportunistically despite the challenging market environment.

Fee-Paying Assets Under Management (AUM):

• Estimated fee-paying AUM grew by 4% year-over-year to approximately $561 million.
• This growth was driven by expansion in both real estate and credit businesses, contributing to the increase in fee-paying assets.

Operational Execution in Real Estate:

• Great Elm Real Estate Ventures completed its third design-build property, contributing approximately $400,000 in revenue from Monomoy Construction Services.
• The company continues to see a robust pipeline of development opportunities, supported by a broader tenant base.

Sentiment Analysis:

Overall Tone: Neutral

• Management acknowledges a 'challenging backdrop' with 'significant unrealized losses' but emphasizes a 'well-positioned' balance sheet, operational execution, and confidence in the strategic direction. Tone balances current challenges with future opportunities and strength.

Q&A:

• Question from Conference Operator (no analyst name provided): There are no questions at this moment. I would like to turn it back to management for closing comments.
  Response: No analyst questions were asked during the call.

Contradiction Point 1

Monomoy REIT Business Scale and Public Offering Readiness

Contradiction on whether the business is at a scale suitable for a public offering.

Is the summary of prepared remarks applicable? - (Not specified; transcript does not contain participant questions)

2026Q2: The Monomoy platform performed well, with the completion of a third design-build property and in-house construction services generating ~$400,000 in revenue. - Jason Reese(CEO)

What is your current overhead and expense structure and your position on the growth trajectory in terms of operating leverage, and could you provide more in-depth information about the Monomoy REIT business? - Nat Stewart (N.A.S. Capital)

2026Q1: While it is not yet at the scale for a public offering, that remains a future possibility. - Jason Reese(CEO)

Contradiction Point 2

Strategic Focus on Real Estate

Shift in stated primary business focus from credit to real estate.

Are there any questions regarding the prepared remarks? - N/A (Prepared Remarks)

2026Q2: The Monomoy platform performed well, with the completion of a third design-build property and in-house construction services generating ~$400,000 in revenue. - Jason Reese(CEO)

Where are the key growth opportunities for acquisitions outside GECC, and is real estate the primary focus or are there other BDC opportunities? - Nate Stewart (Capital Advisors)

2023Q4: There are many opportunities for GECC as a BDC given current market conditions. The company also sees potential to manage new vehicles de novo or acquire other vehicles in the credit space. Real estate is also of interest, particularly industrial real estate, while commercial real estate is not a focus due to distress. - Jason Reese(CEO)

Contradiction Point 3

Market Opportunity Assessment

Change in characterization of market opportunities from "many" to "challenging."

What key points are highlighted in the prepared remarks? - N/A (Prepared Remarks)

2026Q2: The quarter was marked by heightened volatility, pressure on public valuations, and concerns over private credit quality. - Jason Reese(CEO)

Where are the key growth opportunities for acquisitions outside GECC? Is real estate the primary focus or are there other BDC opportunities? - Nate Stewart (Capital Advisors)

2023Q4: There are many opportunities for GECC as a BDC given current market conditions. - Jason Reese(CEO)

Contradiction Point 4

Credit Business Performance and Outlook

Marked contrast between record growth in 2025Q4 and significant challenges and strategic fortification in 2026Q2.

What were the key financial metrics for fiscal Q4 compared to the prior year? - The Call Operator

2026Q2: In response to market challenges, the company fortified its team, re-enrolled the entire portfolio, and focused on diversifying into senior secured opportunities and optimizing credit quality. - Jason Reese(CEO)

What were Great Elm Group’s key financial results and strategic developments in fiscal 2025 and the outlook for fiscal 2026? - The Call Operator

2025Q4: GECC generated record investment income and incentive fees, over $75M in new capital, upsized its credit facility from $25M to $50M, reduced borrowing costs by 50 bps, and increased its dividend by 6% to $0.37 per share. - Jason Reese(CEO)

Contradiction Point 5

Monomoy Platform Revenue and Growth Expectations

Sharp discrepancy in projected revenue growth for the Monomoy Construction Services (MCS) platform between the quarters.

What were the key fiscal Q4 financial metrics and their year-over-year comparisons? - The Call Operator

2026Q2: The Monomoy platform performed well, with the completion of a third design-build property and in-house construction services generating ~$400,000 in revenue. - Jason Reese(CEO)

What were Great Elm Group’s key 2025 financial results and strategic developments, and what is the 2026 outlook? - The Call Operator

2025Q4: Launched Monomoy Construction Services (MCS), which contributed nearly $1M in revenue and expects to more than double revenue in fiscal '26. - Jason Reese(CEO)