TIPTREE INC.

Previous wording

Our Management’s Discussion and Analysis of Financial Condition and Results of Operations are presented in this section as follows:

Current wording

Management’s Discussion and Analysis of Financial Condition and Results of Operations are presented in this section as follows:

Previous wording

The following is a summary of our consolidated financial results for the three months ended March 31, 2026 and 2025. In addition to GAAP results, management uses the Non-GAAP measure book value per share as measurement of operating performance. Management believes this measure provides supplemental information useful to investors as it is frequently used by the financial community to analyze financial performance and comparison among companies. The Company reclassified income and expenses attributable to Fortegra and Reliance to net income (loss) from discontinued operations for the three months ended March 31, 2026 and 2025. Assets and liabilities attributable to Fortegra and Reliance have been reclassified to assets held for sale and liabilities held for sale, respectively, as of March 31, 2026 and 2025.

Current wording

The following is a summary of Tiptree’s consolidated financial results for the three and six months ended June 30, 2026 and 2025. In addition to GAAP results, management uses the Non-GAAP measure book value per share as a measurement of operating performance. Management believes this measure provides supplemental information useful to investors as it is frequently used by the financial community to analyze financial performance and comparison among companies. The Company has reclassified income and expenses attributable to Fortegra and Reliance to net income (loss) from discontinued operations for the three and six months ended June 30, 2026 and 2025.

Previous wording

See Note (3) Dispositions, Assets Held for Sale & Discontinued Operations for further details.

Current wording

See Note (3) Dispositions & Discontinued Operations for further details.

Previous wording

We did not generate operating revenues from continuing operations during the three months ended March 31, 2026, compared to $0.4 million in the prior year, driven by lower other revenue. Interest income from the Company’s cash and cash equivalents was recorded in other income within non-operating income.

Current wording

The Company did not generate operating revenues from continuing operations during the three months ended June 30, 2026, compared to $0.1 million in the prior year, driven by lower other revenue. The Company did not generate operating revenues from continuing operations during the six months ended June 30, 2026, compared to $0.5 million in the prior year, driven by lower other revenue. Interest income from the Company’s cash and cash equivalents and marketable securities was recorded in other income within non operating income.

Previous wording

Total expenses include employee compensation and benefits, public company expenses and other expenses. Employee compensation and benefits include the expense of management, legal, and accounting staff. Other expenses primarily consisted of audit and professional fees, insurance, office rent, expenses for the run-off of our shipping operations and other related expenses.

Current wording

Total expenses include employee compensation and benefits, public company expenses and other expenses. Employee compensation and benefits include the expense of management, legal, and accounting staff. Other expenses primarily consisted of audit and professional fees, insurance, office rent, and other expenses.

Previous wording

For the three months ended March 31, 2026, expenses were $9.0 million, which decreased $4.0 million, or 30.6%, compared to the prior year. For the three months ended March 31, 2026, employee compensation and benefits were $6.8 million, compared to $9.3 million for the prior year, driven by lower incentive compensation and payroll expense associated with the reduction in workforce. Employee compensation and benefits included incentive compensation expense accruals related to the performance of the Company’s continuing and discontinued operations. Of the incentive compensation expense in 2026, $1.5 million was stock-based compensation expense, compared to $2.3 million in 2025. Other expenses were $1.9 million, compared to $3.3 million in the prior year, driven by declines in professional fees.

Current wording

For the three months ended June 30, 2026, expenses were $9.1 million, which decreased $2.9 million, or 24.3%, compared to the prior year. For the six months ended June 30, 2026, expenses were $18.0 million, which decreased $6.9 million, or 27.6%, compared to the prior year. For the three and six months ended June 30, 2026, employee compensation and benefits were $6.5 million and $13.3 million, compared to $7.0 million and $16.3 million, in the respective prior year periods. The declines were driven by lower incentive compensation and payroll expense associated with the reduction in workforce. Employee compensation and benefits included incentive compensation expense accruals related to the performance of the Company’s continuing and discontinued operations. For the six months ended June 30, 2026 and 2025, incentive compensation expense included $2.9 million and $8.4 million of stock-based compensation, respectively. Other expenses were $2.2 million and $4.1 million for the three and six months ended June 30, 2026, respectively, compared to $4.6 million and $7.9 million for the corresponding periods in 2025, primarily driven by declines in professional fees.

Previous wording

For the three months ended March 31, 2026, net realized and unrealized losses were $0.3 million, as compared to the gains of $0.7 million in the prior year, driven by the change in fair value of certain equity and other investments carried at fair value. For the three months ended March 31, 2026, other income was $1.0 million, as compared to $0.5 million in the prior year.

Current wording

For the six months ended June 30, 2026, net realized and unrealized losses were $0.3 million, as compared to the losses of $0.7 million in the prior year, driven by the change in fair value of certain equity and other investments carried at fair value. For the six months ended June 30, 2026, other income was $4.9 million, as compared to $1.4 million in the prior year, primarily driven by higher interest income earned on U.S. Treasury securities held within cash and cash equivalents and marketable securities.

Previous wording

For the three months ended March 31, 2026, the Company reported a pre-tax loss of $8.3 million, as compared to a loss of $11.3 million in the prior year, with the period over period change primarily driven by lower operating expenses.

Current wording

For the three and six months ended June 30, 2026, the Company reported a pre-tax loss of $5.1 million and $13.4 million, respectively, compared to a pre-tax loss of $12.5 million and $23.8 million, in the corresponding prior year periods. The improvement in both periods was driven by lower operating expenses and higher other income.

Previous wording

For the three months ended March 31, 2026, the Company reported a net loss from continuing operations of $7.1 million, compared to a net loss of $9.7 million in the prior year, with the period over period change primarily driven by lower operating expenses.

Current wording

For the three and six months ended June 30, 2026, the Company reported a net loss from continuing operations of $6.4 million and $13.6 million, respectively, compared to a net loss of $10.4 million and $20.1 million, in the corresponding prior year periods. The improvement in both periods was driven by lower operating expenses and higher other income.

Previous wording

For the three months ended March 31, 2026, the Company reported a net income from discontinued operations of $21.4 million, compared to net income of $15.3 million in the prior year, driven by higher Fortegra earnings.

Current wording

For the three and six months ended June 30, 2026, the Company reported a net income from discontinued operations of $395.7 million and $417.1 million, respectively, compared to net income of $29.4 million and $44.7 million, in the corresponding prior year periods. The increase in both periods was primarily attributable to the gain recognized on sale on Fortegra.

Previous wording

Total stockholders’ equity was $750.5 million as of March 31, 2026 compared to $683.5 million as of March 31, 2025, with the increase driven by comprehensive income over the past twelve months, partially offset by share repurchases, preferred dividends paid at Fortegra, and common dividends paid by Tiptree. In the three months ended March 31, 2026, Tiptree returned $2.3 million to common stockholders through dividends paid and $5.0 million through share repurchases.

Current wording

Total stockholders’ equity was $907.1 million as of June 30, 2026 compared to $723.4 million as of June 30, 2025, with the increase driven by comprehensive income over the past twelve months, including the gain on sale of Fortegra, partially offset by share repurchases and dividends. In the six months ended June 30, 2026, the Company returned $4.5 million to common stockholders through dividends paid and $10.3 million through share repurchases.

Previous wording

Book value per share for the period ended March 31, 2026 was $13.42, a 6.2% increase from book value per share of $12.63 as of March 31, 2025, primarily driven by comprehensive income per share, partially offset by dividends paid of $0.06 per share, net changes in non-controlling interests and preferred dividends paid at Fortegra.

Current wording

Book value per share for the period ended June 30, 2026 was $24.34, a 82.6% increase from book value per share of $13.33 as of June 30, 2025, primarily driven by comprehensive income per share, including the gain recognized on Fortegra transaction, partially offset by dividends paid of $0.12 per share, net changes in non-controlling interests and preferred dividends paid at Fortegra.

Previous wording

The income tax benefit from continuing operations of $1.2 million and $1.6 million for the three months ended March 31, 2026 and 2025, respectively, was reflected as components of net income (loss) from continuing operations. For the three months ended March 31, 2026 and 2025, the Company’s effective tax rate related to pre-tax income from continuing operations was equal to 13.9% and 14.2%, respectively, with both lower than the U.S. statutory income tax rate of 21.0%, primarily due to the impacts of nontaxable and nondeductible items.

Current wording

The income tax expense of $1.3 million and benefit $2.0 million from continuing operations for the three months ended June 30, 2026 and 2025, respectively, was reflected as components of net income (loss) from continuing operations. For the three months ended June 30, 2026 and 2025, the Company’s effective tax rate related to pre-tax income from continuing operations was equal to (25.6)% and 16.2%, respectively, with both lower than the U.S. statutory income tax rate of 21.0%, primarily due to the impacts of nontaxable and nondeductible items.

Previous wording

Tiptree signed agreements to sell its insurance and mortgage subsidiaries and recorded deferred taxes on the outside basis on those investments which represents the tax that would be due, before consideration of loss carryforwards, when Tiptree sells its shares in these subsidiaries at their carrying values on Tiptree’s balance sheet. As of March 31, 2026, the deferred tax liability relating to these investments, which remains on Tiptree’s balance since it is a parent-level tax attribute, was $122.0 million, an increase of $4.1 million from the year ended December 31, 2025, of which $3.5 million of benefit was recorded in OCI, and $7.6 million of expense was recorded as a provision for income taxes in discontinued operations. As of March 31, 2025, the deferred tax liability relating to these investments was $91.8 million, an increase of $7.1 million from the year ended December 31, 2024, of which $2.3 million of expense was recorded in OCI, and $4.7 million of expense was recorded as a provision for income taxes in discontinued operations.

Current wording

Tiptree sold its insurance and mortgage subsidiaries during the three months ended June 30, 2026. It had previously recorded deferred taxes on the outside basis on those investments which represented the tax that would be due, before consideration of loss carryforwards, when Tiptree sold its shares in these subsidiaries at their carrying values on Tiptree’s condensed consolidated balance sheet. The balance just prior to the sales was $130.0 million, an increase of $12.2 million from the year ended December 31, 2025, of which $1.8 million of benefit was recorded in OCI, and $14.0 million of expense was recorded as a provision for income taxes in discontinued operations. As of June 30, 2026, the deferred tax liability relating to these investments has been brought to zero and a current tax payable of $204.8 million has been established through the provision for income taxes in discontinued operations.

Previous wording

Total stockholders’ equity was $750.5 million as of March 31, 2026, compared to $752.4 million as of December 31, 2025, with the decrease primarily driven by comprehensive income for the three months ended March 31, 2026, offset by Fortegra preferred dividends, Tiptree common dividends and share repurchases. As of March 31, 2026, there were 37,567,024 shares of common stock outstanding as compared to 37,824,472 shares as of December 31, 2025, with the decrease driven by share repurchases.

Current wording

Total stockholders’ equity was $907.1 million as of June 30, 2026, compared to $752.4 million as of December 31, 2025, with the increase primarily driven by comprehensive income over the past six months, including the gain on sale on Fortegra, offset by dividends paid and share repurchases. As of June 30, 2026, there were 37,266,005 shares of common stock outstanding as compared to 37,824,472 shares as of December 31, 2025, with the decrease driven by share repurchases.

Previous wording

Our principal sources of liquidity are unrestricted cash, cash equivalents and other liquid investments, the Tiptree Credit Agreement and distributions from operating subsidiaries, including income from our investment portfolio and sales of assets, investments and operating businesses. We intend to use our cash resources to continue to fund our operations, grow our businesses and pursue new acquisition opportunities. We may seek additional sources of cash to fund acquisitions or investments. These additional sources of cash may take the form of debt or equity and may be at the parent, subsidiary or asset level. We are a holding company, and our liquidity needs are primarily for compensation, professional fees, office rent and insurance costs.

Current wording

The Company’s principal sources of liquidity are unrestricted cash, cash equivalents and other liquid investments, including income generated from the Company’s investment portfolio and proceeds from the sale of investments and other assets. The Company’s cash resources are intended to fund corporate operations, pursue capital allocation opportunities and return capital to shareholders, as appropriate. Management may seek additional sources of cash to fund acquisitions or investments. These additional sources of cash may take the form of debt or equity and may be at the parent, subsidiary or asset level. Tiptree is a holding company, and the Company's liquidity needs are primarily for compensation, professional fees, office rent and insurance costs.

Previous wording

As of March 31, 2026, cash and cash equivalents were $33.4 million, compared to $30.8 million as of December 31, 2025, an increase of $2.6 million. In addition, the Company held marketable securities of $0.6 million as of March 31, 2026, compared to $21.7 million in December 31, 2025, with the decrease driven by the sale of equities and U.S. Treasury securities.

Current wording

As of June 30, 2026, cash and cash equivalents were $946.9 million, compared to $30.8 million as of December 31, 2025, an increase of $916.1 million, primarily reflecting the net proceeds received from the completed sales of Fortegra and Reliance. In addition, the Company held marketable securities of $158.2 million as of June 30, 2026, compared to $21.7 million in December 31, 2025, as a portion of the sale proceeds were invested in U.S. Treasury securities with a maturity date greater than 90 days at purchase. As of June 30, 2026, the Company had a current tax payable of $204.8 million primarily related to the Fortegra sale. The majority is expected to be paid prior to September 30, 2026.

Previous wording

We believe that cash and cash equivalents, marketable securities, cash flow from operations and the proceeds of the Sale and Purchase Agreement will provide sufficient capital to continue to grow the business and pay down the outstanding debt, capital expenditures and other general corporate needs over the next several years. As we continue to expand our business, including by any acquisitions we may make in the future, additional working capital for increased costs could be required.

Current wording

Management believes that cash and cash equivalents, marketable securities, and cash flow from operations will provide sufficient capital to continue to grow the business, cover capital expenditures and other general corporate needs over the next several years. As management continues to expand Tiptree’s business, including by any acquisitions the Company may make in the future, additional working capital for increased costs could be required.

Previous wording

Refer to the Consolidated Statement of Cash Flow and Note (3) Dispositions, Assets Held for Sale & Discontinued Operations for additional details on cash flows related to discontinued operations.

Current wording

Refer to the Consolidated Statement of Cash Flow and Note (3) Dispositions & Discontinued Operations for additional details on cash flows related to discontinued operations.

Previous wording

Cash used in operating activities for continuing operations the three months ended March 31, 2026 and 2025 was $8.3 million and $12.3 million, respectively. This reflects the use of funds to support centralized management and ongoing corporate-level operating requirements.

Current wording

Cash used in operating activities for continuing operations for the six months ended June 30, 2026 and 2025 was $18.4 million and $13.7 million, respectively. This reflects the use of funds to support centralized management and ongoing corporate-level operating requirements.

Previous wording

Investing activities from continuing operations the three months ended March 31, 2026, generated net cash of $20.9, primarily due to proceeds from sales and maturities of investments exceeding purchased of investments. For the three months ended March 31, 2025 cash used in investing activities was $11.9 million driven by purchases of investments outpacing the proceeds from sales and maturities of investments.

Current wording

For the six months ended June 30, 2026 and 2025, cash used in investing activities was $136.3 million, and $62.9 million, respectively, driven by purchases of investments outpacing the proceeds from sales and maturities of investments.

Previous wording

Cash used in financing activities was $8.0 million for the three months ended March 31, 2026, primarily attributable to the repurchases of common stock, and payment of common dividends. Cash provided by financing activities was $67.1 million for the three months ended March 31, 2025, primarily attributable to proceeds from issuance of debt at the holding company, partially offset by the payment of dividends, cash paid in connection with vested or exercised stock awards, and payment of debt issuance costs.

Current wording

Cash used in financing activities was $89.7 million for the six months ended June 30, 2026, primarily attributable to the principal paydown of borrowings at the holding company, repurchases of common stock, and payment of common dividends. Cash provided by financing activities was $64.7 million for the six months ended June 30, 2025, primarily attributable to proceeds from issuance of debt at the holding company, partially offset by the payment of dividends, cash paid in connection with vested or exercised stock awards, and payment of debt issuance costs.

Previous wording

The preparation of our financial statements, which are in accordance with U.S. GAAP, requires management to make estimates and assumptions that affect the amounts reported in our financial statements and accompanying notes. Actual results could differ materially from those estimates. There have been no material changes to the critical accounting policies and estimates as discussed in Part II, Item 7A in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025.

Current wording

The preparation of the Company’s financial statements, which are in accordance with U.S. GAAP, requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ materially from those estimates. There have been no material changes to the critical accounting policies and estimates as discussed in Part II, Item 7A in Tiptree’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025.