Nuveen Churchill's Net Assets Surge on Income Growth, Debt Costs Rise

TL;DR

**Nuveen Churchill is growing fast, but rising debt costs are a red flag for future profitability despite strong income.**

AI Summary

Nuveen Churchill Private Capital Income Fund reported a net increase in net assets from operations of $61.503 million for the nine months ended September 30, 2025, up from $48.667 million in the same period of 2024. Total investment income significantly increased to $134.292 million for the nine months ended September 30, 2025, compared to $64.192 million in 2024. This was driven by a rise in interest income to $128.158 million from $60.422 million. However, total expenses also rose substantially to $66.676 million in 2025 from $23.720 million in 2024, primarily due to increased interest and debt financing expenses of $43.219 million, up from $10.164 million. The fund experienced a net realized loss on investments of $9.722 million for the nine months ended September 30, 2025, a deterioration from a net realized gain of $442 thousand in 2024. Net change in unrealized depreciation on investments was $5.187 million in 2025, compared to $2.178 million in 2024. The fund's total net assets grew to $1,259,044 million as of September 30, 2025, from $826,140 million at December 31, 2024, largely due to capital share transactions, with issuance of common shares bringing in $440.781 million in 2025.

Why It Matters

This filing reveals Nuveen Churchill Private Capital Income Fund's robust growth in investment income, particularly interest income, which is crucial for investors seeking yield in private credit. However, the significant increase in interest and debt financing expenses could compress future net investment income, impacting shareholder distributions. The competitive landscape for private capital funds remains intense, and the fund's ability to manage these rising costs while continuing to attract capital, as evidenced by the $440.781 million in common share issuances, will be key to its long-term performance. Employees benefit from a growing asset base, while customers of portfolio companies may see continued access to capital, but potentially at higher rates.

Risk Assessment

Risk Level: medium — The fund's secured borrowings increased significantly, with proceeds from secured borrowings at $744.011 million for the nine months ended September 30, 2025, and repayments at $909.512 million. Interest and debt financing expenses surged to $43.219 million, up from $10.164 million in the prior year, indicating increased leverage and sensitivity to interest rate fluctuations. Additionally, the net realized loss on investments of $9.722 million and net change in unrealized depreciation of $5.187 million suggest potential valuation risks within its portfolio.

Analyst Insight

Investors should monitor the fund's net investment income closely, as rising interest expenses could erode profitability despite strong top-line growth. Evaluate the quality and performance of the underlying debt investments, especially given the net realized losses and unrealized depreciation. Consider the fund's ability to maintain its distribution levels amidst increasing financing costs and potential portfolio valuation challenges.

Financial Highlights

revenue

$134,292,000

total Assets

$2,051,198,000

total Debt

$735,258,000

net Income

$61,503,000

cash Position

$15,390,000

revenue Growth

+109.2%

Revenue Breakdown

Key Numbers

• $61.503M — Net increase in net assets from operations (Increased from $48.667M in 2024, showing operational growth.)
• $134.292M — Total investment income (More than doubled from $64.192M in 2024, primarily from interest income.)
• $43.219M — Interest and debt financing expenses (Significantly increased from $10.164M in 2024, impacting net income.)
• $9.722M — Net realized loss on investments (Deteriorated from a $442K gain in 2024, indicating portfolio challenges.)
• $5.187M — Net change in unrealized depreciation (Increased from $2.178M in 2024, reflecting potential valuation declines.)
• $1.259B — Total net assets (Grew from $826.140M at Dec 31, 2024, driven by capital inflows.)
• $440.781M — Proceeds from common share issuance (Significant capital raised, contributing to asset growth.)
• $744.011M — Proceeds from secured borrowings (Indicates increased leverage to finance investments.)
• $909.512M — Repayments of secured borrowings (Shows active management of debt, but net borrowings increased.)
• $13.673M — Payable for share repurchases (Increased from $2.006M at Dec 31, 2024, indicating higher repurchase activity.)

Key Players & Entities

• Nuveen Churchill Private Capital Income Fund (company) — registrant
• $61.503 million (dollar_amount) — net increase in net assets from operations for nine months ended Sep 30, 2025
• $48.667 million (dollar_amount) — net increase in net assets from operations for nine months ended Sep 30, 2024
• $134.292 million (dollar_amount) — total investment income for nine months ended Sep 30, 2025
• $64.192 million (dollar_amount) — total investment income for nine months ended Sep 30, 2024
• $43.219 million (dollar_amount) — interest and debt financing expenses for nine months ended Sep 30, 2025
• $10.164 million (dollar_amount) — interest and debt financing expenses for nine months ended Sep 30, 2024
• $9.722 million (dollar_amount) — net realized loss on investments for nine months ended Sep 30, 2025
• $5.187 million (dollar_amount) — net change in unrealized depreciation on investments for nine months ended Sep 30, 2025
• $440.781 million (dollar_amount) — proceeds from issuance of common shares for nine months ended Sep 30, 2025

FAQ

Risk Factors

• Increased Debt Financing Expenses [high — financial]: Interest and debt financing expenses rose substantially to $43.219 million for the nine months ended September 30, 2025, from $10.164 million in the same period of 2024. This significant increase of over 325% indicates higher leverage costs or increased borrowing, which directly impacts profitability.
• Net Realized and Unrealized Investment Losses [high — market]: The fund experienced a net realized loss on investments of $9.722 million for the nine months ended September 30, 2025, a sharp deterioration from a net realized gain of $442 thousand in 2024. Additionally, the net change in unrealized depreciation increased to $5.187 million from $2.178 million, suggesting potential declines in the fair value of portfolio investments.
• Dependence on Capital Share Transactions [medium — financial]: Total net assets grew to $1,259,044 million from $826,140 million at December 31, 2024, largely due to capital share transactions. The issuance of common shares brought in $440.781 million, highlighting a reliance on new capital rather than solely operational performance for asset growth.
• Increased Share Repurchase Activity [medium — financial]: Payable for share repurchases increased significantly to $13.673 million as of September 30, 2025, from $2.006 million at December 31, 2024. This indicates a higher level of share buyback activity, which can impact liquidity and net asset value per share.
• Secured Borrowings Management [medium — financial]: While secured borrowings decreased from $905.647 million to $735.258 million, the fund also had significant repayments of $909.512 million against proceeds of $744.011 million. This active management of debt, with net repayments, needs to be monitored in conjunction with investment income generation.

Industry Context

The private capital income fund sector is characterized by its focus on generating income from debt and equity investments in private companies. This often involves higher yields but also carries greater illiquidity and credit risk compared to public markets. Funds in this space typically employ leverage to enhance returns. The competitive landscape is driven by the ability to source attractive deals, manage risk effectively, and attract capital from institutional and retail investors.

Regulatory Implications

As a registered investment company, Nuveen Churchill Private Capital Income Fund is subject to regulations under the Investment Company Act of 1940, which governs its operations, disclosures, and capital structure. Increased leverage and complex investment strategies can attract scrutiny regarding investor protection and systemic risk. Compliance with reporting requirements, such as this 10-Q, is crucial.

What Investors Should Do

1. Monitor interest and debt financing expenses closely.
2. Analyze the drivers of realized and unrealized investment losses.
3. Evaluate the sustainability of asset growth through capital inflows.
4. Assess the impact of increased share repurchase activity.

Key Dates

• 2025-09-30: Nine Months Ended — Reporting period showing significant growth in investment income but also increased expenses and realized losses.
• 2024-09-30: Nine Months Ended — Prior period comparison showing lower investment income, expenses, and realized gains.
• 2025-09-30: Total Net Assets — Reached $1,259,044 million, a substantial increase from year-end 2024, driven by capital inflows.
• 2024-12-31: Total Net Assets — Stood at $826,140 million, serving as the baseline for the current period's asset growth.

Glossary

Net assets from operations

The increase or decrease in the fund's net assets resulting from its investment activities and income generation, excluding capital share transactions. (Indicates the core profitability of the fund's investment strategy.)

Net realized loss on investments

The total loss incurred from selling investments during the period, after accounting for any gains from other sales. (Reflects the performance of the fund's investment decisions when assets are sold.)

Net change in unrealized depreciation

The decrease in the fair value of investments that are still held by the fund, representing paper losses. (Indicates potential future realized losses or gains based on current market valuations.)

Paid-in-capital in excess of par value

The amount received from selling shares above their nominal par value, representing additional capital contributed by shareholders. (A key component of the fund's equity, showing capital raised from investors.)

Secured borrowings

Debt that is backed by specific assets of the fund, used to finance investments. (Represents a significant source of leverage for the fund, impacting its financial risk and return profile.)

Year-Over-Year Comparison

Compared to the prior period (nine months ended September 30, 2024), Nuveen Churchill Private Capital Income Fund has seen a substantial increase in total investment income, more than doubling to $134.292 million, primarily driven by a surge in interest income. However, this top-line growth is significantly offset by a more than quadrupling of total expenses to $66.676 million, largely due to a more than 325% jump in interest and debt financing expenses to $43.219 million. The fund also experienced a material shift from a net realized gain to a $9.722 million net realized loss on investments, alongside an increase in unrealized depreciation. Despite these operational challenges, total net assets have grown considerably to $1.259 billion, primarily fueled by substantial capital inflows from common share issuances.

Filing Documents

• ncpif-20250930.htm (10-Q) — 9549KB
• exhibit41-formofsubscripti.htm (EX-4.1) — 193KB
• ceosection302ex311septembe.htm (EX-31.1) — 11KB
• cfosection302ex312septembe.htm (EX-31.2) — 11KB
• a906ex32september302025ncp.htm (EX-32) — 7KB
• 0001911066-25-000038.txt ( ) — 32763KB
• ncpif-20250930.xsd (EX-101.SCH) — 79KB
• ncpif-20250930_cal.xml (EX-101.CAL) — 72KB
• ncpif-20250930_def.xml (EX-101.DEF) — 497KB
• ncpif-20250930_lab.xml (EX-101.LAB) — 766KB
• ncpif-20250930_pre.xml (EX-101.PRE) — 597KB
• ncpif-20250930_htm.xml (XML) — 9263KB

Notes to Consolidated Financial Statements (Unaudited)

Notes to Consolidated Financial Statements (Unaudited) 57 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 90 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 119 Item 4.

Controls and Procedures

Controls and Procedures 121 PART II Other Information 122 Item 1.

Legal Proceedings

Legal Proceedings 122 Item 1A .

Risk Factors

Risk Factors 122 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 123 Item 3. Defaults Upon Senior Securities 123 Item 4. Mine Safety Disclosures 123 Item 5. Other Information 124 Item 6. Exhibits 125

FORWARD-LOOKING STATEMENTS

FORWARD-LOOKING STATEMENTS This report contains forward-looking statements that involve substantial risks and uncertainties. Such statements involve known and unknown risks, uncertainties and other factors and undue reliance should not be placed thereon. These forward-looking statements are not historical facts, but rather are based on our current expectations and estimates, our current and prospective portfolio investments, our industry, our beliefs and opinions, and our assumptions. Words such as "anticipates," "expects," "intends," "plans," "will," "may," "continue," "believes," "seeks," "estimates," "would," "could," "should," "targets," "projects," "outlook," "potential," "predicts" and variations of these words and similar expressions are intended to identify forward-looking statements. These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors, some of which are beyond our control and difficult to predict and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements, including without limitation: our future operating results; our business prospects and the prospects of our portfolio companies; the dependence of our future success on the general economy and its impact on the industries in which we invest; changes in the markets in which we invest and changes in financial and lending markets generally; the impact of a protracted decline in the liquidity of credit markets on our business; the impact of increased competition; an economic downturn or recession and its impact on the ability of our portfolio companies to operate and the investment opportunities available to us; the impact of interest rate volatility on our business, our financial condition and our portfolio companies; the impact of supply chain constraints and labor difficulties on our portfolio companies and the global economy; the level of inflation and its impact on our p

- Financial Information

Part I - Financial Information

Consolidated Financial Statements (Unaudited)

Item 1. Consolidated Financial Statements (Unaudited) NUVEEN CHURCHILL PRIVATE CAPITAL INCOME FUND CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES (dollars in thousands, except share and per share data) September 30, 2025 December 31, 2024 (Unaudited) Assets Investments Non-controlled/non-affiliate company investments, at fair value (cost of $ 1,968,153 and $ 1,687,681 , respectively) $ 1,957,256 $ 1,681,609 Cash 15,390 3,721 Cash equivalents 61,231 63,223 Interest receivable 12,766 10,794 Due from affiliate for expense support (See Note 5 ) 2,079 3,624 Receivable for investments sold 1,815 13,454 Deferred offering costs 525 67 Prepaid expenses 136 44 Total assets $ 2,051,198 $ 1,776,536 Liabilities Secured borrowings (net of $ 8,742 and $ 3,853 deferred financing costs, respectively) (See Note 6 ) $ 735,258 $ 905,647 Payable for investments purchased 11,070 12,061 Management fees payable 729 745 Incentive fees payable 4,262 — Interest payable 12,068 15,671 Due to affiliate for expense support (See Note 5 ) 2,079 3,624 Distributions payable 10,381 7,329 Payable for share repurchases 13,673 2,006 Board of Trustees' fees payable 128 325 Offering costs payable 353 75 Accounts payable and accrued expenses 2,153 2,913 Total liabilities $ 792,154 $ 950,396 Commitments and contingencies (See Note 7 ) Net Assets: (See Note 8 ) Common shares of beneficial interest, par value $ 0.01 per share, unlimited shares authorized, 1,586,760 and 749,491 Class S shares issued and outstanding as of September 30, 2025 and December 31, 2024, respectively $ 16 $ 7 Common shares of beneficial interest, par value $ 0.01 per share, unlimited shares authorized, 1,156,140 and 814,351 Class D shares issued and outstanding as of September 30, 2025 and December 31, 2024, respectively 12 8 Common shares of beneficial interest, par value $ 0.01 per share, unlimited shares authorized, 48,766,112 and 31,750,143 Class I shares issued and outstanding as o

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