Porch Group, Inc.

Effective January 1, 2025, Porch Group Inc. shareholders own three segments: Insurance Services, Software & Data, and Consumer Services. Together, these segments—offset by corporate expenses—comprise what we refer to as the “Porch Shareholder Interest.” These segments contribute to Net Income Attributable to Porch and are what is expected to generate cash for Porch shareholders. Comparative period amounts in the following table include only the Insurance Services, Software & Data, and Consumer Services segments as well as corporate expenses. Certain amounts presented in the following table are non-GAAP measures and are reconciled to the nearest GAAP measure in the earlier “Consolidated Results” section.

(1)Porch Shareholder Interest Revenue, Gross Profit, and Adjusted EBITDA (Loss) are non-GAAP measures. For the three months ended March 31, 2025, Porch Shareholder Interest Adjusted EBITDA (Loss) is equivalent to total Adjusted EBITDA (Loss) for consolidated Porch, as Porch Group no longer owns HOA following its sale to the Reciprocal on January 1, 2025. See Non-GAAP Financial Measures section.

For the three months ended March 31, 2025, revenue for Porch Shareholder Interest increased $0.1 million when compared to the same segments in the prior year period. The increase was primarily due to the launch of the Reciprocal on January 1, 2025, and the associated revenue streams as Porch acts as its manager. This increase was partially offset by an increase in the average coverage period of our warranty products, resulting in revenue being recognized over a longer timeframe, and strategic shift to lower revenue, higher profit services in our moving businesses.

Porch Shareholder Interest Gross Profit improved by $19.2 million for the three months ended March 31, 2025, when compared to the prior year period. This improvement is primarily due to the increase in revenue and a reduction in weather-related claims. Porch Shareholder Interest Gross Profit is a non-GAAP measure. See Non-GAAP Financial Measures section for definition.

Porch Shareholder Interest Adjusted EBITDA (Loss) improved by $20.9 million for the three months ended March 31, 2025, compared to the prior year period. The improvement was primarily driven by the shift in the business model from carrier to the manager of the Reciprocal, producing higher margin management fees and a reduction in weather-related claims. Our Insurance Services segment benefited from the receipt of management fees from the Reciprocal Segment which began in January 2025 and an increase in interest income from the surplus note due from the Reciprocal Segment. Corporate costs also declined due to lower professional fees, reduced reliance on third-party consultants, and strong cost control. Porch Shareholder Interest Adjusted EBITDA (Loss) is a non-GAAP measure. See Non-GAAP Financial Measures section for definition.

INSURANCE SERVICES

(1)Insurance Services Adjusted EBITDA (Loss) is a non-GAAP measure. See Non-GAAP Financial Measures section.

(2)See Key Performance Measures and Operating Metrics for definitions of metrics.

For the three months ended March 31, 2025, Insurance Services segment revenue was $49.8 million. For the three months ended March 31, 2024, Insurance Services segment revenue was $47.4 million. The 5% increase in Insurance Services segment revenue was primarily driven by the launch of the Reciprocal on January 1, 2025, and the associated revenue streams as Porch acts as its manager.

Our Insurance Services segment generates economics in several ways: management fees based on a percentage of Reciprocal Written Premium, policy fees based on the number of Reciprocal Policies Written, non-catastrophic weather quota share reinsurance to improve capital efficiency for the Reciprocal, lead fees from third-party insurance agencies, and interest from the surplus note due from the Reciprocal.

Insurance Services Adjusted EBITDA (Loss) was $25.8 million in the first quarter of 2025, which improved compared to prior year due to the various commissions and fees beginning January 1, 2025, including interest income from the surplus note due from the Reciprocal Segment.

SOFTWARE & DATA

(1)Software & Data Adjusted EBITDA (Loss) is a non-GAAP measure. See Non-GAAP Financial Measures section.

(2)See Key Performance Measures and Operating Metrics for definitions of metrics. In 2025, metrics are presented on a segment-level basis.

For the three months ended March 31, 2025, Software & Data segment revenue was $22.0 million. For the three months ended March 31, 2024, Software & Data segment revenue was $21.1 million. Revenue was impacted by an increase in transaction volume of our Home Factors product and price increases of our title insurance software. These increase were partially offset by a decline in existing homes sales in the industry.

Software & Data Adjusted EBITDA (Loss) was $4.6 million in the first quarter of 2025, which improved compared to prior year due to strong cost control, including a reduction in workforce, lower professional fees, and lower rent expense from an expired lease.

CONSUMER SERVICES

(1)Consumer Services Adjusted EBITDA (Loss) is a non-GAAP measure. See Non-GAAP Financial Measures section.

(2)See Key Performance Measures and Operating Metrics for definitions of metrics. In 2025, metrics are presented on a segment-level basis.

For the three months ended March 31, 2025, Consumer Services segment revenue was $14.7 million. For the three months ended March 31, 2024, Consumer Services segment revenue was $16.2 million. The decrease in revenue was primarily driven by an increase in the average coverage period of our warranty products, resulting in revenue being recognized over a longer timeframe. The decrease in revenue was also driven by a strategic shift to lower revenue higher profit services in our moving businesses. This dynamic is demonstrated by the decrease in Average Revenue per Monetized Service.

Consumer Services Adjusted EBITDA (Loss) was $(0.7) million in the first quarter of 2025, which decreased compared to prior year’s positive results primarily driven by the decrease in monthly revenue resulting from a longer warranty coverage period. The new longer warranty is priced higher but results in a lower monthly rate. An increase in direct mail marketing expense for new warranty products also contributed to the change from prior year.

CORPORATE

(1)Adjusted EBITDA (Loss) is a non-GAAP measure. See Non-GAAP Financial Measures section for definition.

Corporate expenses decreased for the three months ended March 31, 2025, compared to the the same period for 2024. The decrease was driven primarily by lower professional fees and reduced reliance on third-party consultants as well as strong cost control across the business. Our cost control measures included centralizing administrative functions and shifting hiring to target lower-cost locations.