Verisk Analytics, Inc.

Previous wording

**The following discussion should be read in conjunction with our historical financial statements and the related notes included in our annual report on Form 10-K ("2024 10-K") dated and filed with the Securities and Exchange Commission on February 26, 2025. This discussion contains forward-looking statements that involve risks and uncertainties. Our actual results may differ materially from those discussed in or implied by any of the forward-looking statements as a result of various factors, including but not limited to those listed under "Risk Factors" and "Special Note Regarding Forward Looking Statements" in our 2024 Form 10-K and those listed under Item 1A in Part II of this quarterly report on Form 10-Q.

Current wording

**The following discussion should be read in conjunction with our historical financial statements and the related notes included in our annual report on Form 10-K ("2025 10-K") dated and filed with the Securities and Exchange Commission on February 18, 2026. This discussion contains forward-looking statements that involve risks and uncertainties.Our actual results may differ materially from those discussed in or implied by any of the forward-looking statements as a result of various factors, including but not limited to those listed under "Risk Factors" and "Special Note Regarding Forward-Looking Statements" in our 2025 10-K and those listed under Item 1A in Part II of this quarterly report on Form 10-Q.

Previous wording

We earn revenues through agreements for hosted subscriptions, advisory/consulting services, and for transactional solutions, recurring and non-recurring. Subscriptions for our solutions are generally paid in advance of rendering services either quarterly or in full upon commencement of the subscription period, which is usually for one year and automatically renewed each year. As a result, the timing of our cash flows generally precedes our recognition of revenues and income and our cash flow from operations tends to be higher in the first quarter as we receive subscription payments. Examples of these arrangements include subscriptions that allow our customers to access our standardized coverage language, our claims fraud database, or our actuarial services throughout the subscription period. In general, we experience minimal revenue seasonality within the busi ness. For thenine months ended September 30, 2025 and 2024, approximately 83% and 81% of our insurance revenues were derived from hosted subscriptions through agreements (generally one to five years) for our solutions, respectively.

Current wording

We earn revenues through agreements for hosted subscriptions, advisory/consulting services, and for transactional solutions, recurring and non-recurring. Subscriptions for our solutions are generally paid in advance of rendering services either quarterly or in full upon commencement of the subscription period, which is usually for one year and automatically renewed each year. As a result, the timing of our cash flows generally precedes our recognition of revenues and income and our cash flow from operations tends to be higher in the first quarter as we receive subscription payments. Examples of these arrangements include subscriptions that allow our customers to access our standardized coverage language, our claims fraud database, or our actuarial services throughout the subscription period. In general, we experience minimal revenue seasonality within the business. For thethree months ended March 31, 2026 and 2025, approximately 84% and 83% of our insurance revenues were derived from hosted subscriptions through agreements (generally one to five years) for our solutions, respectively.

Previous wording

We also provide advisory/consulting services, which help our customers get more value out of our analytics and their subscriptions. In addition, certain of our solutions are paid for by our customers on a transactional basis, recurring and non-recurring. For example, we have solutions that allow our customers to access property-specific rating and underwriting information to price a policy on a commercial building, or compare a P&C insurance or a workers' compensation claim with information in our databases, or use our repair cost estimation solutions on a case-by-case basis. For thenine months ended September 30, 2025 and 2024, approximately 17% and 19% of our insurance revenues were derived from providing transactional and advisory/consulting solutions, respectively.

Current wording

We also provide advisory/consulting services, which help our customers get more value out of our analytics and their subscriptions. In addition, certain of our solutions are paid for by our customers on a transactional basis, recurring and non-recurring. For example, we have solutions that allow our customers to access property-specific rating and underwriting information to price a policy on a commercial building, or compare a property & casualty insurance or a workers' compensation claim with information in our databases, or use our repair cost estimation solutions on a case-by-case basis. For thethree months ended March 31, 2026 and 2025, approximately 16% and 17% of our insurance revenues were derived from providing transactional and advisory/consulting solutions, respectively.

Previous wording

Personnel expenses are the major component of both our cost of revenues and selling, general and administrative expenses. Personnel expenses, which represented approximately 56% and 57% of our total operating expenses (excluding gains/losses related to dispositions) for the nine months ended September 30, 2025 and 2024, respectively, include salaries, benefits, incentive compensation, equity compensation costs, sales commissions, employment taxes, recruiting costs, and outsourced temporary agency costs.

Current wording

Personnel expenses are the major component of both our cost of revenues and selling, general and administrative expenses. Personnel expenses, which represented approximately 57% and 56% of our total operating expenses (excluding gains/losses related to dispositions) for thethree months ended March 31, 2026 and 2025, respectively, include salaries, benefits, incentive compensation, equity compensation costs, sales commissions, employment taxes, recruiting costs, and outsourced temporary agency costs.

Previous wording

Our recent acquisitions (Rocket within the claims category, Simplitium and SuranceBay within the underwriting category of the Insurance segment) and disposition (AER within the underwriting category of our Insurance segment) resulted in a net decrease in revenue of $7.8 million, while the remaining Insurance revenues increased $155.6 million or 7.3%. Our underwriting revenue increased $119.0 million or 7.9%, primarily due to an annual increase in prices derived from continued enhancements to the models and content of the solutions within our forms, rules and loss cost services, as well as selling expanded solutions to new and existing customers within extreme event solutions and specialty business solutions. Our claims revenue increased $36.6 million or 5.8%, primarily due to solid growth in anti-fraud solutions and property estimating solutions.

Current wording

Our recent acquisitions (Simplitium and SuranceBay within the underwriting category of the Insurance segment) and disposition (Verisk Marketing Solutions ("VMS")within the underwriting category of our Insurance segment) resulted in a net decrease in revenue of $10.9 million, while the remaining Insurance revenues increased $40.5 million or 5.5%. Our underwriting revenue increased $31.0 million or 6.0%, primarily due toprimarily due to an annual increase in prices derived from continued enhancements to the models and content of the solutions within our forms, rules and loss cost services, as well as selling expanded solutions to new and existing customers within catastrophe and risk solutions, specialty business solutions and life solutions. Our claims revenue increased $9.5 million or 4.3%, primarily due to annual price increases in anti-fraud analytics and increased sales in casualty solutions.

Previous wording

Depreciation and amortization of fixed assets were$64.0 million for thethree months ended September 30, 2025 compared to $58.1 millionfor thethree months ended September 30, 2024, anincrease of$5.9 million or 10.2%. The increase was primarily due to internally developed software projects that were completed and placed into service.

Current wording

Depreciation and amortization of fixed assets were$69.9 million for thethree months ended March 31, 2026 compared to$67.4 million for thethree months ended March 31, 2025, an increase of$2.5 million or 3.7%. The increase was primarily due to internally developed software projects that were completed and placed into service.

Previous wording

Investment loss was$1.6 million for thethree months ended September 30, 2025 compared to a gain of$5.9 million for thethree months ended September 30, 2024, adecrease of $7.5 million. The loss was primarily due to the impact of foreign currencies.

Current wording

Investment loss was$0.5 million for thethree months ended March 31, 2026 compared to a gain of$2.6 million for thethree months ended March 31, 2025, a change of$3.1 million. The loss was primarily due to the impact of foreign currencies.

Previous wording

Interest expense, net was$42.2 million for thethree months ended September 30, 2025 compared to $32.1 million for thethree months ended September 30, 2024, anincrease of$10.1 million or 31.5%. The increase was primarily driven by interest expense related to the issuance of our 2030, 2035, and 2036 Senior Notes, partially offset by the repayment of our 2025 Senior Notes and higher interest income for the three months ended September 30, 2025.

Current wording

Interest expense, net was$43.2 million for thethree months ended March 31, 2026 compared to$36.3 million for thethree months ended March 31, 2025, an increase of$6.9 million or 19.0%. The increase was primarily driven by higher interest expense related to the issuance of our 2031 and 2036 Senior Notes in February 2026, as well as the accelerated interest payments associated with the special mandatory redemption of the 4.500% 2030 Senior Notes and 5.125% 2036 Senior Notes, partially offset by higher interest income.

Previous wording

The provision for income taxes was$76.6 million and the effective tax rate was 25.3% for thethree months ended September 30, 2025, compared to$65.3 million and 22.9% for thethree months ended September 30, 2024. The increase in the effective tax rate was primarily due to a nonrecurring tax benefit recognized in the prior period, as well as lower tax benefits from equity compensation in the current period versus the prior period. The difference between statutory tax rates and our effective tax rate is primarily due to state and local taxes, partially offset by tax benefits attributable to equity compensation.

Current wording

The provision for income taxes was$74.3 million and the effective tax rate was 24.1% for thethree months ended March 31, 2026, compared to$64.1 million and 21.6% for thethree months ended March 31, 2025, respectively. The increase in the effective tax rate was primarily due to lower tax benefits from equity compensation in the current period versus the prior period. The difference between statutory tax rates and our effective tax rate is primarily due to state and local taxes, partially offset by tax benefits attributable to equity compensation.

Previous wording

EBITDA was$426.6 million for thethree months ended September 30, 2025 compared to$393.8 million for thethree months ended September 30, 2024. The EBITDA margin for our consolidated results was 55.5% for thethree months ended September 30, 2025 compared to 54.3% for thethree months ended September 30, 2024. The increase in EBITDA margin was mainly driven by revenue growth and cost discipline.

Current wording

EBITDA was$436.0 million for thethree months ended March 31, 2026 compared to$415.9 million for thethree months ended March 31, 2025. The EBITDA margin for our consolidated results was 55.7% for thethree months ended March 31, 2026 compared to 55.2% for thethree months ended March 31, 2025. The increase in EBITDA margin was mainly driven byrevenue growth and cost discipline.

Previous wording

[1] Note: Consolidated EBITDA margin, a non-GAAP measure, is calculated as a percentage of consolidated revenue. A reconciliation from net income to EBITDA is presented in the table below.

Current wording

[1] Note: Consolidated EBITDA margin, a non-GAAP measure, is calculated as a percentage of consolidated revenue. A reconciliation from net income to EBITDA is presented on page 29.

Previous wording

As of September 30, 2025 and December 31, 2024, we had cash and cash equivalents and available-for-sale secu rities totaling $2,108.7 million and $292.5 million, respectively. We maintain our cash and cash equivalents in higher credit quality financial institutions in order to limit the amount of credit exposure. As of September 30, 2025 and December 31, 2024, a vast majority of our domestic cash and cash equivalents is with TD Bank, N.A., JPMorgan Chase N.A., and Northern Trust. Subscriptions for our solutions are billed and generally paid in advance of rendering services either quarterly or in full upon commencement of the subscription period, which is usually for one year. Subscriptions are automatically renewed at the beginning of each calendar year. We have historically generated significant cash flows from operations. As a result of this factor, as well as the availability of funds under our Credit Facility, we expect that we will have sufficient cash to meet our working capital and capital expenditure needs and to fuel our future growth plans.

Current wording

As of March 31, 2026 and December 31, 2025, we had cash and cash equivalents and avai lable-for-sale securities totaling $525.2 million and $2,178.9 million, respectively. We maintain our cash and cash equivalents in higher credit quality financial institutions in order to limit the amount of credit exposure. As of March 31, 2026 and December 31, 2025, a vast majority of our domestic cash and cash equivalents is with TD Bank, N.A. and JPMorgan Chase N.A.. Subscriptions for our solutions are billed and generally paid in advance of rendering services either quarterly or in full upon commencement of the subscription period, which is usually for one year. Subscriptions are automatically renewed at the beginning of each calendar year. We have historically generated significant cash flows from operations. As a result of this factor, as well as the availability of funds under our Syndicated Revolving Credit Facility, we expect that we will have sufficient cash to meet our working capital and capital expenditure needs and to fuel our future growth plans.

Previous wording

We have also historically used a portion of our cash for repurchases of our common stock from our stockholders. During thenine months ended September 30, 2025 and 2024, we repurchased$400.2 million and$750.0 million (inclusive of$60.0 million in treasury stock then not yet settled), respectively, of our common stock. The repurchase of our common stock was funded using cash from operations. For thenine months ended September 30, 2025 and 2024, we also paid dividends of$188.6 million and$166.6 million, respectively.

Current wording

We have also historically used a portion of our cash for repurchases of our common stock from our stockholders. During thethree months ended March 31, 2026 and 2025, we repurchased$1,626.9 million (inclusive of$225.1 million in treasury stock not yet settled) and$200.1 million (inclusive of$30.0 million in treasury stock then not yet settled), respectively, of our common stock. The repurchase of our common stock was funded using cash from operations, and proceeds from our Syndicated Revolving Credit Facility and Term Loan Facility, and cash from operations. For thethree months ended March 31, 2026 and 2025, we also paid dividends of$65.5 million and$63.0 million, respectively.

Previous wording

We had total debt, excluding finance lease liabilities, unamortized discounts and premium, and debt issuance costs of$4,750 million and $3,050.0 million at September 30, 2025 and December 31, 2024, respectively, and we were in compliance with our financial and other covenants. The debt at September 30, 2025, primarily consists of senior notes issued in 2025, 2024, 2023, 2020, 2019 and 2015. Interest on the senior notes is payable semi-annually each year. The unamortized discount and debt issuance costs were recorded as "Short-term debt and current portion of long-term debt" and "Long-term debt" in the accompanying consolidated balance sheets, and will be amortized to "Interest expense" in the accompanying consolidated statements of operations within this Form 10-Q over the life of the respective senior notes. The indenture governing the senior notes restricts our ability to, among other things, create certain liens, enter into sale/leaseback transactions, and consolidate with, sell, lease, convey, or otherwise transfer all or substantially all of our assets, or merge with or into, any other person or entity. We have made, and may from time to time in the future make, optional repayments on our debt obligations, which may include repurchases or exchanges of our outstanding notes, depending on various factors, such as market conditions. Any such repurchases may be effected through privately negotiated transactions, market transactions, tender offers, redemptions or otherwise. See Note 9. for additional information on our financing activities.

Current wording

We had total debt, excluding finance lease liabilities, unamortized discounts and premium, and debt issuance costs of $4,500.0 million and $4,750.0 million at March 31, 2026 and December 31, 2025, respectively, and we were in compliance with our financial and other covenants. The debt at March 31, 2026, primarily consists of senior notes issued in 2026, 2025, 2024, 2023, 2020, and 2015. Interest on the senior notes is payable semi-annually each year. The unamortized discount and debt issuance costs were recorded as "Short-term debt and current portion of long-term debt" and "Long-term debt" in the accompanying consolidated balance sheets, and will be amortized to "Interest expense" in the accompanying consolidated statements of operations within this Form 10-Q over the life of the respective senior notes. The indenture governing the senior notes restricts our ability to, among other things, create certain liens, enter into sale/leaseback transactions, and consolidate with, sell, lease, convey, or otherwise transfer all or substantially all of our assets, or merge with or into, any other person or entity. We have made, and may from time to time in the future make, optional repayments on our debt obligations, which may include repurchases or exchanges of our outstanding notes, depending on various factors, such as market conditions. Any such repurchases may be effected through privately negotiated transactions, market transactions, tender offers, redemptions or otherwise. See Note 7. for additional information on our financing activities.

Previous wording

We had a syndicated revolving credit facility ("Syndicated Revolving Credit Facility") with a borrowing capacity of $1,000.0 million with Bank of America N.A., HSBC Bank USA, N.A., JP Morgan Chase Bank, N.A., Wells Fargo Bank, National Association, Citibank, N.A., Morgan Stanley Bank, N.A., TD Bank, N.A., Goldman Sachs Bank USA, and the Northern Trust Company with a maturity date of April 5, 2028. On August 15, 2025, we entered into the Third Amended and Restated Credit Agreement (the "Amendment and Restatement") to the Syndicated Revolving Credit Facility with Bank of America, N.A. as administrative agent. The Amendment and Restatement increased our borrowing capacity to $1,250.0 million and extends the maturity date to August 15, 2030. Interest on borrowings under the Amendment and Restatement is payable at an interest rate of SOFR plus 100.0 to 162.5 basis points, depending upon our public debt rating. A commitment fee on any unused commitment is payable periodically and may range from 8.0 to 17.5 basis points based upon our public debt rating. The Syndicated Revolving Credit Facility, as amended and restated by the Amendment and Restatement, also contains certain financial and other covenants that, among other things, impose certain restrictions on indebtedness, liens, dispositions fundamental changes, and use of proceeds. The financial covenants require that, at the end of any fiscal quarter, we have a consolidated interest coverage ratio of more than 3.00 to 1.00, we have a consolidated funded debt leverage ratio of less than 3.75 to 1.00. At our election, the maximum consolidated funded debt leverage ratio could be permitted to increase to 4.50 to 1.00 (no more than once) and to 4.25 to 1.00 (no more than once) in connection with the closing of a permitted acquisition. The Syndicated Revolving Credit Facility may be used for general corporate purposes, including working capital needs and capital expenditures, acquisitions, dividend payments, and the share repurchase program (the "Repurchase Program"). In connection with the Amendment and Restatement, we incurred additional debt issuance costs of $1.0 million, which will be amortized to 'Interest expense' within the accompanying consolidated statements of operations over the remaining life of the Syndicated Revolving Credit Facility. As of September 30, 2025, we were in compliance with all financial and other debt covenants under our Syndicated Revolving Credit Facility. As of September 30, 2025 and December 31, 2024, the available capacity under the Syndicated Revolving Credit Facility was $1,245.5 million and $995.4 million, which takes into account outstanding letters of credit of $4.5 million and $4.6 million, respectively.

Current wording

We have a syndicated revolving credit facility ("Syndicated Revolving Credit Facility") with a borrowing capacity of $1,250.0 million with Bank of America N.A., HSBC Bank USA, N.A., The Toronto-Dominion Bank, N.A., Wells Fargo Bank, National Association, JPMorgan Chase Bank, N.A., Goldman Sachs Bank USA, Morgan Stanley Bank, N.A., and The Northern Trust Company. The Syndicated Revolving Credit Facility may be used for general corporate purposes, including working capital needs and capital expenditures, acquisitions, dividend payments, and the share repurchase program (the "Repurchase Program"). As of March 31, 2026, we were in compliance with all financial and other debt covenants under our Syndicated Revolving Credit Facility. During the three months ended March 31, 2026, we drew $750.0 million under our Syndicated Revolving Credit Facility for share repurchases under the accelerated share repurchase agreements, general corporate purposes, and to pay related fees and expenses, and subsequently repaid the full amount prior to March 31, 2026. As of March 31, 2026 and December 31, 2025, the available capacity under the Syndicated Revolving Credit Facility was $1,245.2 million and $1,245.4 million, which takes into account outstanding letters of credit of $4.8 million and $4.6 million, respectively.

Previous wording

On August 15, 2025, we also entered into a $750.0 million Term Credit Agreement (the "Term Loan Facility") with Bank of America N.A. The Term Loan Facility has a maturity date of August 15, 2028 and carries an interest rate of SOFR plus 100.0 to 162.5 basis points, depending upon our public debt rating. The Term Loan Facility also contains certain financial and other covenants that, among other things, impose certain restrictions on indebtedness, liens, dispositions fundamental changes, and use of proceeds.. The financial covenants require that, at the end of any fiscal quarter, we have a consolidated interest rate coverage ratio of less than 3.00 to 1.00. we have a consolidated funded debt leverage ratio of greater than 3.75 to 1.00. At our election, the maximum consolidated funded debt leverage ratio could be permitted to increase to 4.50 to 1.00 (no more than once) and to 4.25 to 1.00 (no more than once) in connection with the closing of a permitted acquisition. We plan to use the borrowings to finance the purchase price for the acquisition of AccuLynx and to pay related fees and expenses. In connection with the Term Loan Facility, we incurred additional debt issuances costs of $5.8 million, which will be amortized to "Interest expense" within the accompanying consolidated statements of operations over the remaining life of the Term Loan Facility.

Current wording

On February 18, 2026, we entered into a term loan credit agreement (the “Term Loan Facility”) with Wells Fargo Bank, National Association. The Term Loan Facility provides for a 364-day senior unsecured delayed draw term loan facility in an aggregate committed principal amount of $500.0 million and carries an interest rate of SOFR plus 95 basis points or a base rate. The financial covenants require that, at the end of any fiscal quarter, we have a consolidated interest rate coverage ratio of not less than 3.00 to 1.00, and a maximum consolidated funded debt leverage ratio of not greater than 3.75 to 1.00. At our election, the maximum consolidated funded debt leverage ratio could be permitted to increase to 4.50 to 1.00 (no more than once) and to 4.25 to 1.00 (no more than once) in connection with the closing of a permitted acquisition. Proceeds of the Term Loan Facility, together with the $750.0 million borrowed under the Company's existing Syndicated Revolving Credit Facility, were used to finance share repurchases under the accelerated share repurchase agreements, to fund general corporate purposes, and to pay related fees and expenses. As of March 31, 2026, the company repaid $250.0 million of the Term Loan Facility and had $250.0 million outstanding under the Term Loan Facility.

Previous wording

Our management’s discussion and analysis of financial condition and results of operations are based on our condensed consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the U.S. The preparation of these financial statements requires management to make estimates and judgments that affect reported amounts of assets and liabilities and related disclosures of contingent assets and liabilities at the dates of the financial statements and revenue and expenses during the reporting periods. These estimates are based on historical experience and on other assumptions that are believed to be reasonable under the circumstances. On an ongoing basis, management evaluates its estimates, including those related to acquisition purchase price allocations, revenue recognition, goodwill and intangible assets, pension and other postretirement benefits, stock-based compensation, income taxes, and allowance for doubtful accounts. Actual results may differ from these assumptions or conditions. Some of the judgments that management makes in applying its accounting estimates in these areas are discussed under the heading "Management’s Discussion and Analysis of Financial Condition and Results of Operations" in our annual report on Form 10-K dated and filed with the Securities and Exchange Commission on February 26, 2025. Since the date of our annual report on Form 10-K, there have been no material changes to our critical accounting policies and estimates other than the items noted below.

Current wording

Our management’s discussion and analysis of financial condition and results of operations are based on our condensed consolidated financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of these financial statements requires management to make estimates and judgments that affect the reported amounts of assets and liabilities and related disclosures of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods. These estimates are based on historical experience and on other assumptions that are believed to be reasonable under the circumstances. On an ongoing basis, management evaluates its estimates, including those related to stock-based compensation, internally developed software, goodwill and intangible assets, pension and other postretirement benefits, and income taxes. Actual results may differ from these assumptions or conditions. Some of the judgments that management makes in applying its accounting estimates in these areas are discussed under the heading "Management’s Discussion and Analysis of Financial Condition and Results of Operations" in our annual report on Form 10-K dated and filed with the Securities and Exchange Commission on February 18, 2026. Since the date of our annual report on Form 10-K, there have been no material changes to our critical accounting policies and estimates.