Management highlighted limited exposure to software as a point of differentiation. Reisner said software exposure stood at about 1.8% of the portfolio at fair value, which he described as consistent with an intentional decision to avoid the sector. Bresner said the quarter ended with three software portfolio companies totaling 1.8% of fair value (2% on an amortized cost basis), and added that the company has “no ARR loans” in the portfolio.

Bresner said CION has historically avoided lending against an annual recurring revenue (ARR) growth methodology where borrowers have negative EBITDA at closing. He characterized that ARR software profile as “more as a venture-oriented investment with equity-like risk” that would require returns above typical first-lien yields.

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Reisner said NAV fell 7.4% quarter-over-quarter to $13.76 from $14.86 at the end of September. He stressed the decline was “driven almost entirely by unrealized mark-to-market adjustments” tied to a subset of equity positions, naming Juice Plus+, 4Wall Entertainment, David’s Bridal, and Addison Group. Bresner also cited Avison Young among the equity positions contributing to the decline.

Bresner described a “common theme” among several of the marked-down names as what the firm calls the “COVID elongation cycle,” in which companies were impacted by COVID-related disruption followed by labor inflation and interest-rate shocks, leading to restructurings or recapitalizations.

• Juice Plus+: Bresner attributed the equity mark reduction to weaker trailing quarterly revenue versus its fixed cost base as the company completed a restructuring in the third quarter, followed by operational initiatives and investments in product offerings and sales infrastructure.

• 4Wall Entertainment: The mark was impacted by reduced trailing EBITDA, with Bresner citing event cancellations and lower TV and film production as pipelines rebuild after the writers’ strike. He said the company restructured its balance sheet in summer 2025 and is expecting EBITDA improvement in 2026.

• David’s Bridal: Bresner said the quarter-to-quarter equity marks can be volatile due to the relative size of the investment and seasonality. He attributed the fourth-quarter mark decline primarily to seasonal debt increases tied to inventory build ahead of the bridal season, and noted incremental capital invested to accelerate growth in the company’s “Pearl” digital marketplace segment.

• Avison Young: Bresner said the equity marks were negatively impacted by incremental debt raised at the top of the capital structure to support investments ahead of an expected increase in commercial real estate activity in 2026 and 2027. He said CION participated in the latest debt round.

Bresner also noted some equity marks increased during the quarter, citing Longview Power, Palmetto Solar, and Playboy, driven by strong financial performance and/or projected outlook.

Bresner said the company remained “highly selective” in the fourth quarter, focusing largely on transactions within existing portfolio companies while operating near full investment and managing the timing of repayments versus new investments within a targeted net leverage range. He said the firm passed on a “historically higher percentage” of potential new investments due to credit and pricing considerations.

He described fourth-quarter secondary market conditions as “choppy,” citing speculation around tariffs and interest rate policies, the government shutdown, and broader concerns about private credit, while also saying there was a “significant bifurcation” in the new issue market. Bresner said new issue pricing reflected a “hangover” from record 2024 private debt fundraising, resulting in lower coupon spreads, higher leverage levels, and looser documentation.

During the quarter, CION made approximately $76 million in investment commitments across one new and 14 existing portfolio companies, with $66 million funded, and funded $12 million of previously unfunded commitments. The firm had $79 million of sales and repayments, including full repayment of first lien term loans for Moss Holding and Northstar Travel, resulting in a net decrease of about $1 million in funded investments. Bresner said the weighted average yield for new direct first-lien investments during the quarter was the equivalent of SOFR plus 6.43%, based on investment cost.

Chief Financial Officer Keith Franz reported net investment income (NII) of $18.3 million, or $0.35 per share, compared with $38.6 million, or $0.74 per share, in the third quarter. Total investment income was $53.8 million versus $78.7 million in the prior quarter, driven primarily by lower interest income following restructurings in the prior quarter and the absence of certain yield-enhancing items such as prepayment fees and accelerated original issue discount that did not recur. Franz also cited lower transaction fees versus the prior quarter, partially offset by higher dividend income from one investment.

At December 31, the company reported total assets of about $1.9 billion and net assets of $708 million, with total debt outstanding of $1.1 billion and 51.4 million shares outstanding. The portfolio at fair value ended the quarter at $1.7 billion, and the weighted average yield on debt and other income-producing investments at amortized cost was 10.7%, down slightly from 10.9% in the third quarter.

Franz said net debt-to-equity rose to 1.44x from 1.28x, driven primarily by the NAV decline and higher average debt outstanding. Asked about leverage, Franz said the company expects organic NAV recovery in some positions may help over the next few quarters, and that it ultimately expects to use scheduled and unscheduled repayments to de-lever.

On capital markets activity, Reisner and Franz highlighted increased unsecured funding. During the quarter, CION issued $172.5 million of senior unsecured notes to institutional investors, including $125 million due 2029 at 7.7% and $47.5 million due 2027 at 7.41%. After year-end, the company completed a $135 million public baby bond offering of senior unsecured notes due 2031 at 7.5%, which began trading on the NYSE under the symbol CICC on February 12. Franz said proceeds were used to repay $125 million of senior unsecured notes due 2026 that matured in February, with remaining proceeds intended to reduce senior secured bank debt.

On shareholder payouts, the company paid a fourth-quarter base distribution of $0.36 per share, matching the third quarter. For full-year 2025, CION declared and paid total distributions of $1.44 per share, all from quarterly base distributions. Franz said the company moved from quarterly to monthly base distributions beginning in January 2026, and declared a second-quarter 2026 base distribution of $0.30 per share, to be paid at $0.10 per month in April, May, and June.

CION Investment Corporation is a closed‐end, non‐diversified management investment company organized as a business development company under the Investment Company Act of 1940. Externally managed by CION Investment Management, LLC, the firm specializes in providing flexible capital solutions to U.S. and Canadian middle‐market companies. By combining debt and equity financing, CION seeks to support growth, acquisitions, recapitalizations and other strategic initiatives for its portfolio companies.

The company’s investment strategy centers on senior secured loans, subordinated debt and private equity interests.

The article “CION Investment Q4 Earnings Call Highlights” was originally published by MarketBeat.