Q - Porch Group,
For the period ended Jun 30, 2025. Filed Aug 5, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2025 · Filed Aug 5, 2025
Extracted filing text, with the paragraph anchors used by the comparison.
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Consolidated Quarter-to-Date Results
| Three Months Ended June 30, | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| 2025 · 2024 · $ Change · % Change | |||||||||
| (dollar amounts in thousands) | |||||||||
| Revenue | $119,295 | $110,844 | $8,451 | 8% | |||||
| Cost of revenue | 43,422 | 94,046 | (50,624) | (54)% | |||||
| Gross Profit | 75,873 | 16,798 | 59,075 | 352% | |||||
| Operating expenses: | |||||||||
| Selling and marketing | 26,858 | 33,197 | (6,339) | (19)% | |||||
| Product and technology | 13,076 | 12,927 | 149 | 1% | |||||
| General and administrative | 30,890 | 23,153 | 7,737 | 33% | |||||
| Total operating expenses | 70,824 | 69,277 | 1,547 | 2% | |||||
| Operating income (loss) | 5,049 | (52,479) | 57,528 | (110)% | |||||
| Other income (expense): | |||||||||
| Interest expense | (12,056) | (10,326) | (1,730) | 17% | |||||
| Change in fair value of private warrant liability | (2,878) | 1,451 | (4,329) | (298)% | |||||
| Change in fair value of derivatives | 12,853 | (8,207) | 21,060 | (257)% | |||||
| Gain on extinguishment of debt | 34 | — | 34 | N/A | |||||
| Investment income and realized gains and losses, net of investment expenses | 2,665 | 3,526 | (861) | (24)% | |||||
| Other income, net | 1,493 | 2,400 | (907) | (38)% | |||||
| Total other income (expense) | 2,111 | (11,156) | 13,267 | (119)% | |||||
| Income (loss) before income taxes | 7,160 | (63,635) | 70,795 | (111)% | |||||
| Income tax benefit (provision) | 1,087 | (688) | 1,775 | (258)% | |||||
| Net income (loss) | 8,247 | (64,323) | 72,570 | (113)% | |||||
| Less: Net income attributable to the Reciprocal | 5,668 | — | 5,668 | N/A | |||||
| Net income (loss) attributable to Porch | $2,579 | $(64,323) | $66,902 | (104)% | |||||
| Net income (loss) | $8,247 | $(64,323) | $72,570 | (113)% | |||||
| Net loss (income) attributable to the Reciprocal | (5,668) | — | (5,668) | N/A | |||||
| Interest expense | 12,026 | 10,326 | 1,700 | 16% | |||||
| Income tax provision (benefit) | (1,186) | 688 | (1,874) | (272)% | |||||
| Depreciation and amortization | 4,461 | 6,202 | (1,741) | (28)% | |||||
| Gain on extinguishment of debt | (34) | — | (34) | N/A | |||||
| Other income, net | (95) | (704) | 609 | (87)% | |||||
| Loss (gain) on reinsurance contract | — | (1,095) | 1,095 | (100)% | |||||
| Stock-based compensation expense | 8,000 | 7,105 | 895 | 13% | |||||
| Mark-to-market losses (gains) | (9,975) | 5,405 | (15,380) | (285)% | |||||
| Restructuring costs | (187) | 1,635 | (1,822) | (111)% | |||||
| Acquisition and other transaction costs | 41 | (12) | 53 | (442)% | |||||
| Adjusted EBITDA (Loss) | (1) | $15,630 | $(34,773) | $50,403 | (145)% | ||||
| Adjusted EBITDA (Loss) Margin | (1) | 13% | (31)% | ||||||
(1)Adjusted EBITDA (Loss) and Adjusted EBITDA (Loss) Margin are non-GAAP measures. See Non-GAAP Financial Measures section for definitions.
Revenue. Total consolidated revenue including the Reciprocal increased by $8.5 million, or 8%, from $110.8 million in the three months ended June 30, 2024, to $119.3 million in the three months ended June 30, 2025. The increase in revenue was primarily a result of higher premium per policy offset by a reduction in policies in force. Revenue related to the Porch Shareholder Interest was $107.0 million in the three months ended June 30, 2025, as detailed in the following table.
Cost of revenue. Total consolidated cost of revenue including the Reciprocal decreased by $50.6 million, or 54%, from $94.0 million in the three months ended June 30, 2024, to $43.4 million in the three months ended June 30, 2025. The decrease was primarily the result of a reduction in weather related claims. As a percentage of revenue, cost of revenue represented 36% of revenue in the three months ended June 30, 2025, compared with 85% in the three months ended June 30, 2024. Cost of revenue typically exhibits seasonal trends, with lower costs in the first and fourth quarters and higher costs in the second and third quarters, primarily due to increased frequency and severity of weather-related events and timing of insurance-related expenses. There were fewer weather related claims in the second quarter of 2025 compared to historical seasonal trends. Cost of revenue related to Porch Shareholder Interest was $17.8 million in the three months ended June 30, 2025, as detailed in the table below. Porch Shareholder Interest Cost of Revenue is a non-GAAP measure. See Non-GAAP Financial Measures section for definition.
Selling and marketing. Total consolidated selling and marketing expenses including the Reciprocal decreased by $6.3 million, or 19%, from $33.2 million in the three months ended June 30, 2024, to $26.9 million in the three months ended June 30, 2025. The decrease is primarily driven by a reduction in the amortization of deferred policy acquisition costs, reflecting a shift away from policies written under historically higher commission rates. As a percentage of revenue, selling and marketing expenses represented 23% of revenue in the three months ended June 30, 2025 compared with 30% in the three months ended June 30, 2024. Selling and marketing expense related to Porch Shareholder Interest was $55.1 million in the three months ended June 30, 2025, as detailed in the table below. Porch Shareholder Interest Selling and Marketing is a non-GAAP measure. See Non-GAAP Financial Measures section for definition.
General and administrative. Total consolidated general and administrative expenses including the Reciprocal increased by $7.7 million, or 33%, from $23.2 million in three months ended June 30, 2024, to $30.9 million in the three months ended June 30, 2025, primarily due to a one-time agency partnership payment during the three months ended June 30, 2025. General and administrative expenses related to Porch Shareholder Interest were $24.1 million in the three months ended June 30, 2025, as detailed in the table below. Porch Shareholder Interest General and Administrative is a non-GAAP measure. See Non-GAAP Financial Measures section for definition.
Change in fair value of derivatives. The fair value of the derivative liability decreased in the three months ended June 30, 2025, compared increasing during the three months ended June 30, 2024. The value is driven by various factors, including the fair value of the underlying debt, stock price, and assumptions regarding timing of possible repurchase events. See Note 6 in the unaudited Notes to Condensed Consolidated Financial Statements. The change in fair value of derivatives relates entirely to Porch Shareholder Interest.
Adjusted EBITDA (Loss). Adjusted EBITDA (Loss) for the three months ended June 30, 2025, was $15.6 million, a $50.4 million improvement from Adjusted EBITDA (Loss) of $(34.8) million for the same period in 2024. The year-over year improvement in Adjusted EBITDA (Loss) was primarily attributable to the absence of weather related claims in the current period, which negatively impacted Adjusted EBITDA in the prior year, as well as the shift in the business model from carrier to the manager of the Reciprocal, producing higher margin management fees. Our Insurance Services segment benefited from the receipt of commissions and fees related to 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 and cost in our Software & Data and Consumers Services segments also declined due to reduced workforce, less reliance on third party consultants, centralizing administrative functions, and shifting hiring to target lower-cost locations. Adjusted EBITDA (Loss) is a non-GAAP measure. See Non-GAAP Financial Measures section for definition.
The following tables summarize operating results of our four segments as well as corporate expenses and eliminations.
| Insurance Services · Software & Data · Consumer Services · Corporate · Eliminations (1) · Porch Shareholder Interest Subtotal (2) · Reciprocal Segment · Eliminations Related to Reciprocal Segment (3) · Consolidated | |||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | $67,390 | $24,013 | $17,650 | $— | $(2,035) | $107,018 | $55,409 | $(43,132) | $119,295 | ||||||
| Cost of revenue | 9,526 | 5,846 | 2,414 | — | (2) | 17,784 | 23,896 | 1,742 | 43,422 | ||||||
| Gross Profit | 57,864 | 18,167 | 15,236 | — | (2,033) | 89,234 | 31,513 | (44,874) | 75,873 | ||||||
| Gross Margin | 86% | 76% | 86% | —% | 100% | 83% | 57% | 104% | 64% | ||||||
| Less: Operating expenses: | |||||||||||||||
| Selling and marketing | 37,025 | 9,226 | 10,465 | 398 | (2,033) | 55,081 | 3,635 | (31,858) | 26,858 | ||||||
| Product and technology | 2,539 | 4,625 | 1,067 | 4,287 | — | 12,518 | 558 | — | 13,076 | ||||||
| General and administrative | 5,313 | 2,622 | 3,089 | 13,028 | — | 24,052 | 19,854 | (13,016) | 30,890 | ||||||
| Operating income (loss) | (17,713) | — | (2,417) | 7,466 | — | 5,049 | |||||||||
| Other expense (income) | (5,453) | (10) | (110) | 1,763 | — | (3,810) | 1,699 | — | (2,111) | ||||||
| Income (loss) before income taxes | (19,476) | — | 1,393 | 5,767 | — | 7,160 | |||||||||
| Income tax benefit (provision) | 1,186 | — | 1,186 | (99) | — | 1,087 | |||||||||
| Net income (loss) | $(18,290) | $— | $2,579 | $5,668 | $— | 8,247 | |||||||||
| Less: Net income attributable to the Reciprocal | 5,668 | ||||||||||||||
| Net income attributable to Porch | $2,579 | ||||||||||||||
| Adjusted EBITDA (Loss) Reconciliation: | |||||||||||||||
| Net income (loss) | $(18,290) | $2,579 | $8,247 | ||||||||||||
| Less Reconciling items: | |||||||||||||||
| Net income attributable to the Reciprocal | — | 5,668 | |||||||||||||
| Depreciation and amortization | (85) | (2,951) | (840) | (585) | — | (4,461) | (4,461) | ||||||||
| Stock-based compensation expense | (1,039) | (897) | (437) | (5,628) | — | (8,001) | (8,001) | ||||||||
| Gain (loss) on extinguishment of debt | — | — | — | 34 | — | 34 | 34 | ||||||||
| Interest expense | — | — | 1 | (12,027) | — | (12,026) | (12,026) | ||||||||
| Income tax provision | — | — | — | 1,186 | — | 1,186 | 1,186 | ||||||||
| Mark-to-market gains (losses) | — | — | — | 9,975 | — | 9,975 | 9,975 | ||||||||
| Other gains and losses | (93) | 10 | 44 | 281 | — | 242 | 242 | ||||||||
| Adjusted EBITDA (Loss) (4) | $19,657 | $5,542 | $1,957 | $(11,526) | $15,630 | $15,630 | |||||||||
(2)The “Porch Shareholder Interest Subtotal” column includes non-GAAP measures that are used by management to evaluate performance. Porch Shareholder Interest includes the Insurance Services, Software & Data, and Consumer Services segments as well as Corporate expenses and applicable intercompany eliminations. See Non-GAAP Financial Measures section.
(3)The “Eliminations Related to Reciprocal Segment” column represents eliminations of transactions between the Reciprocal Segment and other segments or Corporate.
(4)Adjusted EBITDA (Loss) is a non-GAAP measure. See Non-GAAP Financial Measures section for definition.
| Insurance Services · Software & Data · Consumer Services · Corporate · Eliminations (1) · Subtotal · Reciprocal Segment · Eliminations Related to Reciprocal Segment (2) · Consolidated | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | $34,080 | $23,173 | $18,858 | $— | $(246) | $75,865 | $48,739 | $(13,760) | $110,844 | ||
| Cost of revenue | 19,459 | 5,846 | 3,790 | — | (18) | 29,077 | 69,071 | (4,102) | 94,046 | ||
| Gross Profit | 14,621 | 17,327 | 15,068 | — | (228) | 46,788 | (20,332) | (9,658) | 16,798 | ||
| Gross Margin | 43% | 75% | 80% | —% | 93% | 62% | (42)% | 70% | 15% | ||
| Less: Operating expenses: | |||||||||||
| Selling and marketing | 12,058 | 10,400 | 10,614 | 575 | (228) | 33,419 | 9,436 | (9,658) | 33,197 | ||
| Product and technology | 86 | 4,586 | 1,052 | 5,297 | — | 11,021 | 1,906 | — | 12,927 | ||
| General and administrative | 1,701 | 3,411 | 2,321 | 14,122 | — | 21,555 | 1,598 | — | 23,153 | ||
| Operating income (loss) | (19,994) | — | (19,207) | (33,272) | — | (52,479) | |||||
| Other expense (income) | (1,663) | (30) | 237 | 13,689 | — | 12,233 | (1,077) | — | 11,156 | ||
| Income (loss) before income taxes | (33,683) | — | (31,440) | (32,195) | — | (63,635) | |||||
| Income tax benefit (provision) | (688) | — | (688) | — | — | (688) | |||||
| Net income (loss) | $(34,371) | $— | $(32,128) | $(32,195) | $— | $(64,323) | |||||
| Adjusted EBITDA (Loss) Reconciliation: | |||||||||||
| Net income (loss) | $(34,371) | $(32,128) | $(64,323) | ||||||||
| Less: Reconciling items: | |||||||||||
| Depreciation and amortization | (993) | (3,796) | (917) | (490) | — | (6,196) | (6) | — | (6,202) | ||
| Stock-based compensation expense | (392) | (1,271) | (561) | (4,881) | — | (7,105) | — | — | (7,105) | ||
| Interest expense | — | 30 | (3) | (10,478) | — | (10,451) | (1,716) | 1,841 | (10,326) | ||
| Income tax provision | — | — | — | (688) | — | (688) | — | — | (688) | ||
| Mark-to-market gains (losses) | — | — | 1,351 | (6,756) | — | (5,405) | — | — | (5,405) | ||
| Other gains and losses | (14) | (39) | (178) | 1,152 | — | 921 | 1,096 | (1,841) | 176 | ||
| Adjusted EBITDA (Loss) (3) | $3,838 | $4,036 | $1,152 | $(12,230) | $(3,204) | $(34,773) | |||||
(2)The “Eliminations Related to Reciprocal Segment” column represents eliminations of transactions between the Reciprocal Segment and other segments or Corporate.
(3)Adjusted EBITDA (Loss) is a non-GAAP measure. See Non-GAAP Financial Measures section for definition.
The text of this filing, as the company filed it with the SEC, without its images or exhibits. This is not investment advice.