Goosehead Insurance, Inc.

Previous wording

Financial Highlights for the Second Quarter of 2025:

Current wording

Financial Highlights for the Third Quarter of 2025:

Previous wording

•Total Written Premiums placed increased 18% from the prior-year period to $1.2 billion

Current wording

•Total Written Premiums placed increased 15% from the prior-year period to $1.2 billion

Previous wording

•Net income decreased by $2.6 million from the second quarter of 2024 to $8.3 million, or 9% of total revenues

Current wording

•Net income increased by $0.1 million from the third quarter of 2024 to $12.7 million, or 14% of total revenues

Previous wording

•Adjusted EBITDA* increased 18% from the second quarter of 2024 to $29.2 million, or 31% of total revenues

Current wording

•Adjusted EBITDA* increased 14% from the third quarter of 2024 to $29.7 million, or 33% of total revenues

Previous wording

•Basic and diluted earnings per share were $0.20 and $0.18, respectively, and Adjusted EPS* was $0.49 per share for the three months ended June 30, 2025

Current wording

•Basic and diluted earnings per share were $0.31 and $0.29, respectively, and Adjusted EPS* was $0.46 per share for the three months ended September 30, 2025

Previous wording

•Policies in Force increased 13% from June 30, 2024 to 1,793,000 at June 30, 2025

Current wording

•Policies in Force increased 13% from September 30, 2024 to 1,853,000 at September 30, 2025

Previous wording

•Corporate sales headcount increased 53% from June 30, 2024 to 479 at June 30, 2025

Current wording

•Corporate sales headcount increased 14% from September 30, 2024 to 523 at September 30, 2025

Previous wording

◦As of June 30, 2025, 282 of these Corporate sales agents had less than one year of tenure and 197 had greater than one year of tenure

Current wording

◦As of September 30, 2025, 286 of these Corporate sales agents had less than one year of tenure and 237 had greater than one year of tenure

Previous wording

•Total operating franchises decreased 4% from June 30, 2024 to 1,075 at June 30, 2025

Current wording

•Total operating franchises decreased 4% from September 30, 2024 to 1,068 at September 30, 2025

Previous wording

◦As of June 30, 2025, 95 operating Franchisees had less than one year of tenure and 980 operating Franchisees had greater than one year of tenure

Current wording

◦As of September 30, 2025, 101 operating Franchisees had less than one year of tenure and 967 operating Franchisees had greater than one year of tenure

Previous wording

During the three months ended June 30, 2025, revenue increased by 20% to $94.0 million from $78.1 million for the three months ended June 30, 2024. For the six months ended June 30, 2025, revenue increased by 19% to $169.6 million from $142.5 million for the six months ended June 30, 2024. Total Written Premium, which we believe is the best leading indicator of future revenue, increased 18% to $1.18 billion for the three months ended June 30, 2025 from $999 million for the three months ended June 30, 2024. Total Written Premium increased 20% for the six months ended June 30, 2025 to $2.2 billion from $1.82 billion for the six months ended June 30, 2024. Total Written Premiums drive our current and future Core Revenue and give us potential opportunities to earn Ancillary Revenue in the form of Contingent Commissions.

Current wording

During the three months ended September 30, 2025, revenue increased by 16% to $90.4 million from $78.0 million for the three months ended September 30, 2024. For the nine months ended September 30, 2025, revenue increased by 18% to $260.0 million from $220.6 million for the nine months ended September 30, 2024. Total Written Premium, which we believe is the best leading indicator of future revenue, increased 15% to $1.18 billion for the three months ended September 30, 2025 from $1.03 billion for the three months ended September 30, 2024. Total Written Premium increased 18% for the nine months ended September 30, 2025 to $3.4 billion from $2.85 billion for the nine months ended September 30, 2024. Total Written Premiums drive our current and future Core Revenue and give us potential opportunities to earn Ancillary Revenue in the form of Contingent Commissions.

Previous wording

The following is a discussion of our consolidated results of operations for each of the three and six months ended June 30, 2025 and 2024. This information is derived from our accompanying condensed consolidated financial statements prepared in accordance with GAAP.

Current wording

The following is a discussion of our consolidated results of operations for each of the three and nine months ended September 30, 2025 and 2024. This information is derived from our accompanying condensed consolidated financial statements prepared in accordance with GAAP.

Previous wording

New Business Commissions increased by $0.9 million, or 13%, to $7.6 million for the three months ended June 30, 2025 from $6.7 million for the three months ended June 30, 2024. New Business Commissions increased by $1.0 million, or 8%, to $13.3 million for the six months ended June 30, 2025 from $12.4 million for the six months ended June 30, 2024. The increase during each of the three and six months ended June 30, 2025 was primarily driven by an increase in the number of Corporate sales agents, offset by product challenges in Texas where our corporate network still has large exposure.

Current wording

New Business Commissions increased by $1.3 million, or 20%, to $7.5 million for the three months ended September 30, 2025 from $6.2 million for the three months ended September 30, 2024. New Business Commissions increased by $2.2 million, or 12%, to $20.8 million for the nine months ended September 30, 2025 from $18.6 million for the nine months ended September 30, 2024. The increase during each of the three and nine months ended September 30, 2025 was primarily driven by an increase in the number of Corporate sales agents, offset by product availability challenges in Texas, which represents the largest geographic concentration for our corporate network.

Previous wording

Revenue from Agency Fees increased by $0.8 million, or 36%, to $2.9 million for the three months ended June 30, 2025 from $2.1 million for the three months ended June 30, 2024. Revenue from Agency Fees increased by $1.1 million, or 27%, to $5.1 million for the six months ended June 30, 2025 from $4.0 million for the six months ended June 30, 2024. The increase in Agency Fees during each of the three and six months ended June 30, 2025 was primarily attributable to an increase in the average fee charged, as well as an increase in the number of policies written where an agency fee was charged.

Current wording

Revenue from Agency Fees increased by $0.7 million, or 36%, to $2.7 million for the three months ended September 30, 2025 from $2.0 million for the three months ended September 30, 2024. Revenue from Agency Fees increased by $1.8 million, or 30%, to $7.9 million for the nine months ended September 30, 2025 from $6.0 million for the nine months ended September 30, 2024. The increase in Agency Fees during each of the three and nine months ended September 30, 2025 was primarily attributable to an increase in the average fee charged as well as an increase in the number of policies written where an agency fee was charged.

Previous wording

Revenue from Contingent Commissions increased by $2.3 million to $4.5 million for the three months ended June 30, 2025 from $2.2 million for the three months ended June 30, 2024. Revenue from Contingent Commissions increased by $4.1 million, to $9.0 million for the six months ended June 30, 2025 from $4.9 million for the six months ended June 30, 2024. The increase during each of the three and six months ended June 30, 2025 was primarily attributable to an increase in Total Written Premium and receiving and qualifying for additional Contingent Commissions.

Current wording

Revenue from Contingent Commissions increased by $2.1 million to $4.5 million for the three months ended September 30, 2025 from $2.5 million for the three months ended September 30, 2024. Revenue from Contingent Commissions increased by $6.1 million, to $13.5 million for the nine months ended September 30, 2025 from $7.4 million for the nine months ended September 30, 2024. The increase during each of the three and nine months ended September 30, 2025 was primarily attributable to an increase in Total Written Premium and receiving and qualifying for additional Contingent Commissions.

Previous wording

Revenue from Renewal Royalty Fees increased by $8.6 million, or 23%, to $45.4 million for the three months ended June 30, 2025 from $36.8 million for the three months ended June 30, 2024. Revenue from Renewal Royalty Fees increased by $16.7 million, or 25%, to $82.6 million for the six months ended June 30, 2025 from $65.9 million for the six months ended June 30, 2024. The increase in revenue from Renewal Royalty Fees during each of the three and six months ended June 30, 2025 was primarily attributable to an increase in the number of policies in the renewal term, assisted by client retention of 84%; rising premium rates; and $1.0 million from the release of the constraint on certain variable consideration related to policies placed and made effective in previous periods.

Current wording

Revenue from Renewal Royalty Fees increased by $7.6 million, or 20%, to $45.7 million for the three months ended September 30, 2025 from $38.1 million for the three months ended September 30, 2024. Revenue from Renewal Royalty Fees increased by $24.4 million, or 23%, to $128.3 million for the nine months ended September 30, 2025 from $104.0 million for the nine months ended September 30, 2024. The increase in revenue from Renewal Royalty Fees during each of the three and nine months ended September 30, 2025 was primarily attributable to an increase in the number of policies in the renewal term, assisted by client retention of 85% and rising premium rates. The increase for the nine months ended September 30, 2025 was also impacted by the recognition of $1.0 million due to the release of the constraint on certain variable consideration related to policies placed and made effective in previous periods.

Previous wording

Revenue from New Business Royalty Fees increased by $0.7 million, or 9%, to $7.8 million for the three months ended June 30, 2025 from $7.2 million for the three months ended June 30, 2024. Revenue from New Business Royalty Fees increased by $1.3 million, or 10%, to $14.7 million for the six months ended June 30, 2025 from $13.4 million for the six months ended June 30, 2024. The increase in revenue from New Business Royalty Fees during each of the three and six months ended June 30, 2025 was primarily attributable to an increase in franchise productivity and rising premium rates.

Current wording

Revenue from New Business Royalty Fees increased by $1.3 million, or 18%, to $8.3 million for the three months ended September 30, 2025 from $7.0 million for the three months ended September 30, 2024. Revenue from New Business Royalty Fees increased by $2.6 million, or 13%, to $23.0 million for the nine months ended September 30, 2025 from $20.4 million for the nine months ended September 30, 2024. The increase in revenue from New Business Royalty Fees during each of the three and nine months ended September 30, 2025 was primarily attributable to an increase in the number of franchise agents, an increase in franchise productivity, and rising premium rates.

Previous wording

Revenue from Initial Franchise Fees decreased by $0.4 million, or 24%, to $1.2 million for the three months ended June 30, 2025 from $1.6 million for the three months ended June 30, 2024. Revenue from Initial Franchise Fees decreased by $1.3 million, or 33%, to $2.6 million for the six months ended June 30, 2025 from $3.9 million for the six months ended June 30, 2024. The decrease in Revenue from Initial Franchise Fees during each of the three and six months ended June 30, 2025 was primarily attributable to lower turnover of franchises during the period, which avoids accelerated recognition of Initial Franchise Fees for terminated franchises.

Current wording

Revenue from Initial Franchise Fees remained flat at $1.4 million for the three months ended September 30, 2025 compared to the three months ended September 30, 2024. Revenue from Initial Franchise Fees decreased by $1.3 million, or 25%, to $4.0 million for the nine months ended September 30, 2025 from $5.3 million for the nine months ended September 30, 2024. The decrease in Revenue from Initial Franchise Fees during the nine months ended September 30, 2025 was primarily attributable to lower turnover of franchises during the period, which avoids accelerated recognition of Initial Franchise Fees for terminated franchises.

Previous wording

Interest income decreased by $0.1 million, or 27%, to $0.2 million for the three months ended June 30, 2025 from $0.2 million for the three months ended June 30, 2024. Interest income decreased by $0.1 million, or 26%, to $0.4 million for the six months ended June 30, 2025 from $0.5 million for the six months ended June 30, 2024. The decrease in interest income during each of the three and six months ended June 30, 2025 was primarily attributable to fewer franchises operating under the payment plan option during the period.

Current wording

Interest income decreased by $0.1 million, or 30%, to $0.2 million for the three months ended September 30, 2025 from $0.2 million for the three months ended September 30, 2024. Interest income decreased by $0.2 million, or 27%, to $0.5 million for the nine months ended September 30, 2025 from $0.7 million for the nine months ended September 30, 2024. The decrease in interest income during each of the three and nine months ended September 30, 2025 was primarily attributable to fewer franchises operating under the payment plan option during the period.

Previous wording

Employee compensation and benefits expenses increased by $7.8 million, or 18%, to $50.4 million for the three months ended June 30, 2025 from $42.6 million for the three months ended June 30, 2024. Employee compensation and benefits expenses increased by $14.0 million, or 17%, to $98.7 million for the six months ended June 30, 2025 from $84.7 million for the six months ended June 30, 2024. The increase in employee compensation during each of the three and six months ended June 30, 2025 was primarily related to investments in corporate producers and our service and technology functions.

Current wording

Employee compensation and benefits expenses increased by $5.5 million, or 13%, to $48.7 million for the three months ended September 30, 2025 from $43.2 million for the three months ended September 30, 2024. Employee compensation and benefits expenses increased by $19.5 million, or 15%, to $147.4 million for the nine months ended September 30, 2025 from $127.9 million for the nine months ended September 30, 2024. The increase in employee compensation during each of the three and nine months ended September 30, 2025 was primarily related to investments in corporate producers and our service and technology functions.

Previous wording

General and administrative expenses increased by $7.8 million, or 46%, to $24.6 million for the three months ended June 30, 2025 from $16.9 million for the three months ended June 30, 2024. The increase was primarily attributable to $4.7 million of asset impairment charges during the period and increased spending on technologies. General and administrative expenses increased by $8.2 million, or 24%, to $42.2 million for the six months ended June 30, 2025 from $34.0 million for the six months ended June 30, 2024. This increase in general and administrative expenses during each of the three and six months ended June 30, 2025 was primarily attributable to an increase of $4.3 million in asset impairment charges and increased spending on technologies and professional services.

Current wording

General and administrative expenses increased by $1.9 million, or 13%, to $17.1 million for the three months ended September 30, 2025 from $15.2 million for the three months ended September 30, 2024. The increase was primarily attributable to increased spending on technologies and professional services. General and administrative expenses increased by $10.1 million, or 20%, to $59.3 million for the nine months ended September 30, 2025 from $49.2 million for the nine months ended September 30, 2024. This increase in general and administrative expenses during the nine months ended September 30, 2024 was primarily attributable to an increase of $4.3 million in asset impairment charges and increased spending on technologies and professional services.

Previous wording

Bad debts decreased by $0.1 million, or 16%, to $0.6 million for the three months ended June 30, 2025 from $0.7 million for the three months ended June 30, 2024. Bad debts decreased by $0.8 million, or 46%, to $1.0 million for the six months ended June 30, 2025 from $1.8 million for the six months ended June 30, 2024. The decrease during each of the three and six months ended June 30, 2025 was primarily attributable to lower turnover of franchises during the periods.

Current wording

Bad debts decreased by $0.1 million, or 11%, to $0.5 million for the three months ended September 30, 2025 from $0.6 million for the three months ended September 30, 2024. Bad debts decreased by $0.9 million, or 38%, to $1.5 million for the nine months ended September 30, 2025 from $2.3 million for the nine months ended September 30, 2024. The decrease during the nine months ended September 30, 2024 was primarily attributable to lower turnover of franchises during the periods.

Previous wording

Depreciation and amortization increased by $0.2 million, or 6%, to $2.8 million for the three months ended June 30, 2025 from $2.6 million for the three months ended June 30, 2024. Depreciation and amortization increased by $0.3 million, or 5%, to $5.5 million for the six months ended June 30, 2025 from $5.2 million for the six months ended June 30, 2024. This increase during each of the three and six months ended June 30, 2025 was primarily attributable to increased spending on software development since June 30, 2024.

Current wording

Depreciation and amortization increased by $0.2 million, or 8%, to $2.8 million for the three months ended September 30, 2025 from $2.6 million for the three months ended September 30, 2024. Depreciation and amortization increased by $0.5 million, or 6%, to $8.3 million for the nine months ended September 30, 2025 from $7.8 million for the nine months ended September 30, 2024. This increase during each of the three and nine months ended September 30, 2025 was primarily attributable to increased spending on software development since September 30, 2024.

Previous wording

Interest expense increased by $4.3 million for the three months ended June 30, 2025, to $6.3 million from $2.0 million for the three months ended June 30, 2024. Interest expense increased $8.7 million to $12.1 million for the six months ended June 30, 2025 from $3.5 million for the six months ended June 30, 2024. The primary driver of the increase during each of the three and six months ended June 30, 2025 was an increase in total borrowings outstanding during the periods.

Current wording

Interest expense increased by $3.9 million, or 190%, for the three months ended September 30, 2025 to $6.0 million from $2.1 million for the three months ended September 30, 2024. Interest expense increased $12.6 million, or 227%, to $18.1 million for the nine months ended September 30, 2025 from $5.5 million for the nine months ended September 30, 2024. The primary driver of the increase during each of the three and nine months ended September 30, 2025 was an increase in total borrowings outstanding during the periods.

Previous wording

Other income (expense) consists of remeasurements of our TRA liability, interest earned on cash balances, and loss on debt extinguishment. Other income (expense) increased by $0.4 million for the three months ended June 30, 2025 as a result of interest income generated by cash held in interest-bearing checking accounts. Other income (expense) increased by $7.3 million for the six months ended June 30, 2025 primarily due to remeasurements of our TRA liability during the six months ended June 30, 2024 due to increases in our effective tax rate as we identified additional state filing requirements.

Current wording

Other income (expense) consists of interest earned on cash deposits, loss on debt extinguishment, debt modification expense, interest expense on current TRA payments, and remeasurements of our TRA liability. Other income (expense) decreased by $0.8 million for the three months ended September 30, 2025 primarily attributable to debt modification expense associated with our debt refinancing on July 9, 2025. Other income (expense) increased by $6.5 million for the nine months ended September 30, 2025 primarily due to remeasurements of our TRA liability during the nine months ended September 30, 2024 due to increases in our effective tax rate as we identified additional state filing requirements.

Previous wording

Tax expense (benefit) decreased by $1.1 million for the three months ended June 30, 2025, to a tax expense of $1.9 million from a tax expense $3.0 million for the three months ended June 30, 2024. The decrease in tax expense was primarily attributable to a decrease in pre-tax income and increases in tax benefits related to the exercise of stock options. Tax expense (benefit) increased by $5.8 million for the six months ended June 30, 2025 to an expense of $0.2 million from a benefit of $5.6 million for the six months ended June 30, 2024. The increase in tax expense (benefit) was primarily attributable to remeasurements of our deferred tax asset during the six months ended June 30, 2024 due to increases in our effective tax rate as we identified additional state filing requirements.

Current wording

Tax expense (benefit) increased by $0.1 million for the three months ended September 30, 2025, to a tax expense of $2.4 million from a tax expense $2.3 million for the three months ended September 30, 2024. Tax expense (benefit) increased by $5.9 million for the nine months ended September 30, 2025 to an expense of $2.6 million from a benefit of $3.3 million for the nine months ended September 30, 2024. The increase in tax expense (benefit) for the three months ended September 30, 2025 was primarily attributable to increases in income before taxes. The increase in tax expense (benefit) for the nine months ended September 30, 2024 was primarily attributable to remeasurements of our deferred tax asset due to increases in our effective tax rate as we identified additional state filing requirements.

Previous wording

The following tables show Total Written Premium placed by corporate agents and franchisees for the three and six months ended June 30, 2025 and 2024(in thousands).

Current wording

The following tables show Total Written Premium placed by corporate agents and franchisees for the three and nine months ended September 30, 2025 and 2024(in thousands).

Previous wording

As of June 30, 2025, we had 1.8 million Policies in Force compared to 1.7 million as of December 31, 2024 and 1.6 million as of June 30, 2024, representing a 7% and a 13% increase, respectively.

Current wording

As of September 30, 2025, we had 1.9 million Policies in Force compared to 1.7 million as of December 31, 2024 and 1.6 million as of September 30, 2024, representing a 11% and a 13% increase, respectively.

Previous wording

score of 7 or 8 are called Passives, and a 9 or 10 are Promoters. NPS is calculated by subtracting the percentage of Detractors from the percentage of Promoters. For example, if 50% of respondents were Promoters and 10% were Detractors, NPS is a 40. NPS is a useful gauge of the loyalty of client relationships and can be compared across companies and industries.

Current wording

score of 7 or 8 are Passives, and a 9 or 10 are Promoters. NPS is calculated by subtracting the percentage of Detractors from the percentage of Promoters. For example, if 50% of respondents were Promoters and 10% were Detractors, NPS is a 40. NPS is a useful gauge of the loyalty of client relationships and can be compared across companies and industries.

Previous wording

NPS has decreasedto 84 as of June 30, 2025, compared to 91 as of June 30, 2024.

Current wording

NPS has decreasedto 81 as of September 30, 2025, compared to 90 as of September 30, 2024.

Previous wording

Client Retention of 84% at June 30, 2025 remained steady when compared to 84% at December 31, 2024, and 84% at June 30, 2024 despite premium rate increases, supported by our service team’s continued focus on delivering highly differentiated service levels. For the trailing twelve months ended June 30, 2025, we retained 95% of the premiums we distributed in the trailing twelve months ended June 30, 2024, which decreased from the 98% premium retention at December 31, 2024. The decline in premium retention is primarily attributable to a moderating premium rate increases combined with stable client retention. Our premium retention rate is higher than our Client Retention rate as a result of both premiums increasing year over year and additional coverages sold by our sales and service teams.

Current wording

Client Retention of 85% at September 30, 2025 increased when compared to 84% at December 31, 2024, and 84% at September 30, 2024 assisted by moderating premium rate increases. For the trailing twelve months ended September 30, 2025, we retained 93% of the premiums we distributed in the trailing twelve months ended September 30, 2024, which decreased from the 98% premium retention at December 31, 2024. The decline in premium retention is primarily attributable to moderating premium rate increases combined with stable client retention. Our premium retention rate is higher than our Client Retention rate as a result of both premiums increasing year over year and additional coverages sold by our sales and service teams.

Previous wording

For the three months ended June 30, 2025, New Business Revenue grew 14% to $18.3 million, from $16.0 million for the three months ended June 30, 2024. For the six months ended June 30, 2025, New Business Revenue grew 11% to $33.2 million, from $29.8 million for the six months ended June 30, 2024. Growth in New Business Revenue during each of the three and six months ended June 30, 2025 was primarily driven by an increase in the number of Corporate sales agents, growth in Franchise productivity, and rising premium rates.

Current wording

For the three months ended September 30, 2025, New Business Revenue grew 22% to $18.5 million, from $15.2 million for the three months ended September 30, 2024. For the nine months ended September 30, 2025, New Business Revenue grew 15% to $51.7 million, from $45.0 million for the nine months ended September 30, 2024. Growth in New Business Revenue during each of the three and nine months ended September 30, 2025 was primarily driven by an increase in the number of Corporate and Franchise sales agents, growth in Franchise productivity, and rising premium rates.

Previous wording

For the three months ended June 30, 2025, Renewal Revenue grew 19% to $68.5 million, from $57.4 million for the three months ended June 30, 2024. For the six months ended June 30, 2025, Renewal Revenue grew 20% to $122.7 million, from $102.4 million for the six months ended June 30, 2024. Growth in Renewal Revenue during each of the three and six months ended June 30, 2025 was driven by the release of the constraint on certain variable consideration related to policies placed and made effective in previous periods, an increase in the number of policies in the renewal term assisted by Client Retention of 84% at June 30, 2025, and rising premium rates.

Current wording

For the three months ended September 30, 2025, Renewal Revenue grew 12% to $65.4 million, from $58.3 million for the three months ended September 30, 2024. For the nine months ended September 30, 2025, Renewal Revenue grew 17% to $188.1 million, from $160.7 million for the nine months ended September 30, 2024. Growth in Renewal Revenue during the three months ended September 30, 2025 was driven by an increase in the number of policies in the renewal term assisted by Client Retention of 85% at September 30, 2025, and rising premium rates. The increase during the nine months ended September 30, 2025 also reflects the release of the constraint on certain variable consideration related to policies placed and made effective in previous periods.

Previous wording

Core Revenue increased by $13.4 million, or 18%, to $86.8 million for the three months ended June 30, 2025 from $73.4 million for the three months ended June 30, 2024. Core Revenue increased by $23.7 million, or 18%, to $155.9 million for the six months ended June 30, 2025 from $132.2 million for the six months ended June 30, 2024. The primary drivers of the increase during each of the three and six months ended June 30, 2025 was an increase in policies in their renewal term, assisted by Client Retention of 84%; more new policies written driven by an increase in the number of Corporate sales agents and Franchise productivity; rising premium rates; and the release of the constraint on certain variable consideration related to policies placed and made effective in previous periods.

Current wording

Core Revenue increased by $10.4 million, or 14%, to $83.9 million for the three months ended September 30, 2025 from $73.5 million for the three months ended September 30, 2024. Core Revenue increased by $34.0 million, or 17%, to $239.8 million for the nine months ended September 30, 2025 from $205.8 million for the nine months ended September 30, 2024. The primary drivers of the increase during the three months ended September 30, 2025 were an increase in policies in their renewal term, assisted by Client Retention of 85%; more new policies written driven by an increase in the number of Corporate and Franchise sales agents and growth in Franchise productivity; and rising premium rates. The increase during the nine months ended September 30, 2025 also reflects the release of the constraint on certain variable consideration related to policies placed and made effective in previous periods.

Previous wording

Cost Recovery Revenue decreased by $0.4 million, or 24%, to $1.4 million for the three months ended June 30, 2025 from $1.9 million for the three months ended June 30, 2024. The primary driver of the decrease was a decrease in total franchises. Cost Recovery Revenue decreased by $1.4 million, or 32%, to $3.0 million for the six months ended June 30, 2025 from $4.4 million for the six months ended June 30, 2024. The primary driver was a decrease in terminations of franchises, resulting in less acceleration of initial franchise fee revenue.

Current wording

Cost Recovery Revenue decreased by $0.1 million, or 6%, to $1.5 million for the three months ended September 30, 2025 from $1.6 million for the three months ended September 30, 2024. The primary driver of the decrease was a decrease in total franchises. Cost Recovery Revenue decreased by $1.5 million, or 25%, to $4.5 million for the nine months ended September 30, 2025 from $6.0 million for the nine months ended September 30, 2024. The primary drivers were a decrease in total franchises and a decrease in terminations of franchises, resulting in less acceleration of initial franchise fee revenue.

Previous wording

Ancillary Revenue increased by $3.0 million to $5.8 million for the three months ended June 30, 2025 from $2.8 million for the three months ended June 30, 2024. Ancillary Revenue increased by $4.8 million to $10.7 million for the six months ended June 30, 2025 from $5.9 million for the six months ended June 30, 2024. The increase during each of the three and six months ended June 30, 2025 was primarily attributable to an increase in Total Written Premium and receiving and qualifying for additional Contingent Commissions.

Current wording

Ancillary Revenue increased by $2.1 million to $5.0 million for the three months ended September 30, 2025 from $2.9 million for the three months ended September 30, 2024. Ancillary Revenue increased by $7.0 million to $15.8 million for the nine months ended September 30, 2025 from $8.8 million for the nine months ended September 30, 2024. The increase during each of the three and nine months ended September 30, 2025 was primarily attributable to an increase in Total Written Premium and receiving and qualifying for additional Contingent Commissions.

Previous wording

Adjusted EBITDA increased by $4.5 million, or 18%, to $29.2 million for the three months ended June 30, 2025 from $24.7 million for the three months ended June 30, 2024. Adjusted EBITDA increased by $8.3 million, or 23%, to $44.7 million for the six months ended June 30, 2025 from $36.4 million for the six months ended June 30, 2024. The primary driver of the increase in Adjusted EBITDA during each of the three and six months ended June 30, 2025 was growth in total revenue including the recognition of $4 million of revenue due to the release of a constraint on certain variable consideration related to policies placed and made effective in previous periods. The increase in total revenue during each of the three and six months ended June 30, 2025 was partially offset by an increase in employee compensation and benefits excluding equity-based compensation.

Current wording

Adjusted EBITDA increased by $3.5 million, or 14%, to $29.7 million for the three months ended September 30, 2025 from $26.1 million for the three months ended September 30, 2024. Adjusted EBITDA increased by $11.8 million, or 19%, to $74.4 million for the nine months ended September 30, 2025 from $62.5 million for the nine months ended September 30, 2024. The primary driver of the increase in Adjusted EBITDA during each of the three and nine months ended September 30, 2025 was growth in total revenue partially offset by an increase in employee compensation and benefits excluding equity-based compensation. Additionally, the increase for the nine months ended September 30, 2025 included $4 million recognized in the second quarter of 2025 due to the release of a constraint on certain variable consideration related to policies placed and made effective in previous periods.

Previous wording

For the three months ended June 30, 2025, Adjusted EBITDA Margin was 31% compared to 32% for the three months ended June 30, 2024 as a result of employee compensation benefits excluding equity-based compensation growing at a faster rate than total revenue. For the six months ended June 30, 2025, Adjusted EBITDA Margin of 26% was unchanged when compared to 26% for the six months ended June 30, 2024.

Current wording

For the three months ended September 30, 2025, Adjusted EBITDA Margin was 33% compared to 34% for the three months ended September 30, 2024 primarily as a result of employee compensation and benefits, excluding equity-based compensation, growing at a faster rate than total revenue. For the nine months ended September 30, 2025, Adjusted EBITDA Margin of 29% increased when compared to 28% for the nine months ended September 30, 2024 as a result of total revenue growing at a faster rate than general and administrative expenses excluding impairment expense and a decline in bad debt expense.

Previous wording

(1) Adjusted EBITDA Margin is calculated as Adjusted EBITDA divided by Total Revenue ($29,152/$94,027) and ($24,661/$78,088) for the three months ended June 30, 2025 and 2024, respectively. Adjusted EBITDA Margin is calculated as Adjusted EBITDA divided by Total Revenue ($44,672/$169,611), and ($36,388/$142,548) for the six months ended June 30, 2025 and 2024, respectively.

Current wording

(1) Adjusted EBITDA Margin is calculated as Adjusted EBITDA divided by Total Revenue ($29,688/$90,435) and ($26,145/$78,035) for the three months ended September 30, 2025 and 2024, respectively. Adjusted EBITDA Margin is calculated as Adjusted EBITDA divided by Total Revenue ($74,360/$260,046), and ($62,533/$220,583) for the nine months ended September 30, 2025 and 2024, respectively.

Previous wording

(1) Calculated as equity-based compensation divided by sum of weighted average Class A and Class B shares [$6.0 million/(25.2 million + 12.3 million)] for the three months ended June 30, 2025 and [$6.6 million/ (24.7 million + 12.8 million)] for the three months ended June 30, 2024. Calculated as equity-based compensation divided by sum of weighted average Class A and Class B shares [$12.3 million/(25.0 million + 12.5 million)] for the six months ended June 30, 2025 and [$14.0 million/ (24.9 million + 12.8 million)] for the six months ended June 30, 2024.

Current wording

(1) Calculated as equity-based compensation divided by sum of weighted average Class A and Class B shares [$5.6 million/(25.1 million + 12.1 million)] for the three months ended September 30, 2025 and [$7.1 million/ (24.3 million + 12.7 million)] for the three months ended September 30, 2024. Calculated as equity-based compensation divided by sum of weighted average Class A and Class B shares [$17.8 million/(25.1 million + 12.3 million)] for the nine months ended September 30, 2025 and [$21.1 million/ (24.7 million + 12.8 million)] for the nine months ended September 30, 2024.