Results Exceed Expectations Driven by Insurance Services
SEATTLE--(BUSINESS WIRE)--November 05, 2025--
Porch Group, Inc. ("Porch Group", "Porch" or "the Company") (NASDAQ: PRCH), a new kind of homeowners insurance company, today reported third quarter results through September 30, 2025, that exceeded expectations. The Company correspondingly raised Gross Profit and Adjusted EBITDA guidance.
Porch generated for shareholders(1) third quarter 2025 revenue of $115.1 million. Net income (loss) attributable to Porch was $(10.9) million, and Adjusted EBITDA was $20.6 million, an increase of $3.7 million compared to prior year(2) .
On January 2, 2025, the Porch Reciprocal Exchange ("Reciprocal") was formed as an insurance entity owned by its policyholder-members and not by Porch. While Porch does not own the Reciprocal, it is consolidated for reporting purposes. This earnings release references results generated for Porch shareholders ("Porch Shareholder Interest"), which includes the businesses Porch shareholders own: Insurance Services, Software & Data, and Consumer Services segments, along with corporate functions. This earnings release also includes consolidated results which is Porch Shareholder Interest plus the Reciprocal Segment. The following table presents financial highlights for Porch Shareholder Interest(1) and consolidated third quarter 2025 results ($ in millions).
Three Months Ended September 30, 2025
------------------------------------------------------------------------------------------------------------
Porch
Shareholder
Insurance Software Consumer Interest
Services & Data Services Corporate(3) (1) Reciprocal Eliminations Consolidated
Revenue $ 73.8 $ 24.6 $ 19.4 $ (2.8) $ 115.1 $ 51.9 $ (48.9) $ 118.1
Growth n/a 7% 9% n/a n/a n/a
Gross Profit 62.3 18.2 16.6 (2.8) 94.2 40.4 (47.7) 86.9
Growth(4) 53% 41%
Gross Margin 84% 74% 86 % n/a 82% 74%
Net income
(loss) (10.9) 9.9 -- (1.0)
----------- --------- -------- -------------- -----------
Adjusted
EBITDA
(Loss) 25.3 5.1 2.5 (12.3) 20.6
======= ======== ======= ========== ===========
Adjusted
EBITDA (Loss)
Margin(5) 34% 21% 13% n/a 18%
Cash Flow from
Operations(6) $ 28.8 $ 12.0 $ 40.8
CEO Summary
"We're proud to report another strong quarter--one in which we delivered Adjusted EBITDA of $20.6 million, generated $28.8 million of Porch Shareholder Interest Cash Flow from Operations, and importantly, further increased surplus combined with non-admitted assets to $412.0 million at the Reciprocal. We will continue to prioritize Reciprocal surplus generation through Q4, creating the capacity to scale premiums and profits rapidly in 2026 and beyond," said Matt Ehrlichman, Chief Executive Officer, Chairman and Founder.
Third Quarter 2025 Operational Highlights
-- Insurance Services top of the funnel activity reached strong levels
across quoting activity and agency appointments.
-- In Software and Data, we remain focused on product innovation, including
a continuation of introducing new Home Factors to the market.
-- In Consumer Services, partnership efforts are progressing nicely, while
our warranty business experienced lower claims activity compared to the
prior year.
-- The Reciprocal is healthy with $412.0 million of surplus combined with
non-admitted assets at the end of Q3 2025, an increase of $341.5 million
from Q3 2024 and $112.8 million from Q2 2025.
(1) "Porch Shareholder Interest" includes the businesses Porch shareholders
own: Insurance Services, Software & Data, and Consumer Services
segments, along with corporate functions.
(2) Porch Shareholder Interest Adjusted EBITDA of $20.6 million in Q3 2025
increased $3.7 million compared to Q3 2024 consolidated Adjusted EBITDA
of $16.9 million.
(3) Corporate includes corporate costs and eliminations relating to
intersegment transactions for Revenue and Gross Profit.
(4) Porch Shareholder Interest Gross Profit of $94.2 million in Q3 2025
increased 53% or $32.5 million compared to Q3 2024 consolidated Gross
Profit of $61.7 million.
(5) Adjusted EBITDA (Loss) Margin is calculated as Adjusted EBITDA (Loss)
divided by Revenue.
(6) Cash Flow from Operations represents net cash provided by operating
activities. See details in the unaudited Supplemental Cash Flow
Information section of this release.
The following table presents the Company's key performance indicators ("KPIs"). Definitions are on page 10 of this release.
Three Months Ended
September 30,
--------------------
2025
--------------------
Insurance Services KPIs
Reciprocal Written Premium ("RWP") (in millions) $ 137.5
Reciprocal Policies Written (in thousands) 47.7
RWP per Policy Written $ 2,884
Software & Data KPIs
Average Number of Companies (in thousands) 23.8
Annualized Average Revenue per Company $ 4,140
Consumer Services KPIs
Monetized Services (in thousands) 93.9
Average Revenue per Monetized Service $ 206
Balance Sheet Information (unaudited)
The following table provides the components of cash and cash equivalents, restricted cash and cash equivalents, and investments of Porch Shareholder Interest.
(in millions) September 30, 2025 December 31, 2024
------------------------------ -------------------- -------------------
Cash and cash equivalents of
Porch Shareholder Interest $ 73.4 $ 46.5
Short-term investments of Porch
Shareholder Interest 11.6 1.6
Long-term investments of Porch
Shareholder Interest 38.9 13.5
--- --------------- ---- -------------
Unrestricted cash, cash
equivalents, and
investments of Porch
Shareholder Interest 123.9 61.6
Restricted cash and cash
equivalents of Porch
Shareholder Interest 8.1 28.2
--- --------------- ---- -------------
All cash, cash equivalents,
investments, and
restricted cash and cash
equivalents of Porch
Shareholder Interest $ 132.1 $ 89.9
=== =============== ==== =============
At September 30, 2025, Porch Shareholder Interest cash, cash equivalents, restricted cash and cash equivalents, and investments was $132.1 million. The increase from December 31, 2024, was driven by Porch Shareholder Interest Cash Flow from Operations of $70.9 million(1) , primarily from Adjusted EBITDA of $53.1 million and a $7.1 million receipt from the Vesttoo bankruptcy process. Porch used $68.0 million of cash to repurchase a portion of the 0.75% Convertible Senior Unsecured Notes due September 2026 (the "2026 Notes") during the nine months ended September 30, 2025, including $51.0 million of cash proceeds from the issuance of the 9.00% Convertible Senior Unsecured Notes due May 2030 (the "2030 Notes"). Our Board of Directors authorized management to repurchase the remaining 2026 Notes in cash in the open market or through privately negotiated transactions. Porch also holds $106 million surplus notes from the Reciprocal, which are eliminated in consolidation. The Notes bear interest of SOFR +9.75%.
Porch does not own the Reciprocal, but it is consolidated for reporting purposes at this time. Therefore management's focus is on generating Porch shareholder cash, cash equivalents, and investments for Porch Shareholder Interest, which is what Porch shareholders own.
As of September 30, 2025, outstanding principal for convertible debt was $475.1 million. This includes $134.0 million of the 2030 Notes, $333.3 million of the 6.75% Convertible Senior Secured Notes due October 2028 (the "2028 Notes"), and $7.8 million of the 2026 Notes.
_______________
(1) Porch Shareholder Interest Cash Flow from Operations is consistent with
and also referred to as Porch Shareholder Interest Net Cash Provided by
Operating Activities.
Porch Shareholder Interest Full Year 2025 Financial Outlook
Porch Group provides full year 2025 guidance based on current market conditions and expectations as of the date of this release.
Financial guidance represents Porch Shareholder Interest, the businesses owned by Porch(1) , following the formation of the Reciprocal and sale of HOA to the Reciprocal in January 2025. For the avoidance of doubt, guidance does not include the future results of the Reciprocal; while we consolidate their results into Porch GAAP financial statements at this time, the Reciprocal results will be excluded from guidance on Revenue, Gross Profit, Adjusted EBITDA and the associated margins.
Porch Shareholder Interest Full Year 2025 guidance is as follows:
Porch Shareholder Interest Increase at the
2025 Guidance mid-point
Revenue(2)
$410m to $420m
(Previously: $405m to $425m) ---
------------------------------ ---------------
Gross Profit(2)
$335m to $340m
(Previously: $328m to $342m) $2.5m
------------------------------ ---------------
Adjusted EBITDA(2)
$70m
(Previously: $65m to $70m) $2.5m
------------------------------ ---------------
(1) Results in this earnings release reference results generated for
Porch shareholders ("Porch Shareholder Interest"), which includes
the Insurance Services, Software & Data, and Consumer Services
segments, along with corporate functions. These are the businesses
which Porch owns.
(2) Porch Shareholder Interest Revenue, Gross Profit and Adjusted
EBITDA are non-GAAP measures.
Porch Group is not providing reconciliations of Porch Shareholder Interest expected Revenue, Gross Profit or Adjusted EBITDA for future periods to the most directly comparable measures prepared in accordance with GAAP because the Company is unable to provide these reconciliations without unreasonable effort because certain information necessary to calculate such measures on a GAAP basis is unavailable or dependent on the timing of future events outside of the Company's control.
Conference Call
Porch Group management will host a conference call today November 5, 2025, at 5:00 p.m. Eastern time (2:00 p.m. Pacific time). The call will be accompanied by a slide presentation available on the Investor Relations section of the Company's website at ir.porchgroup.com. A question-and-answer session will follow management's prepared remarks.
All are invited to listen to the event by registering for the webinar, a replay of the webinar will also be available. See the Investor Relations section of the Porch Group's corporate website at ir.porchgroup.com.
About Porch Group
Porch Group, Inc. ("Porch") is a new kind of homeowners insurance company. Porch's strategy to win in homeowners insurance is to deploy leading vertical software solutions in select home-related industries, provide the best services for homebuyers including important moving services, leverage unique data for advantaged underwriting, and provide more protection for policyholders.
To learn more about Porch, visit ir.porchgroup.com.
Forward-Looking Statements
Certain statements in this release are considered forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. These statements are based on the beliefs and assumptions of management. Although we believe that our plans, intentions, and expectations reflected in or suggested by these forward-looking statements are reasonable, we cannot assure you that we will achieve or realize these plans, intentions, or expectations. Forward-looking statements are inherently subject to risks, uncertainties, and assumptions. Generally, statements that are not historical facts, including statements concerning our financial outlook and guidance, possible or assumed future actions, business strategies, events, or results of operations, are forward-looking statements. These statements may be preceded by, followed by, or include the words "believe," "estimate," "expect," "project," "forecast," "may," "will," "should," "seek," "plan," "scheduled," "anticipate," "intend," or similar expressions.
Forward-looking statements are not guarantees of performance. You should not put undue reliance on these statements which speak only as of the date hereof. You should understand that the following important factors, among others, could affect our future results and could cause those results or other outcomes to differ materially from those expressed or implied in our forward-looking statements:
-- expansion plans and opportunities, and managing growth, to build a
consumer brand;
-- the incidence, frequency, and severity of weather events, extensive
wildfires, and other catastrophes;
-- economic conditions, especially those affecting the housing, insurance,
and financial markets;
-- expectations regarding revenue, cost of revenue, operating expenses, and
the ability to achieve and maintain future profitability;
-- existing and developing federal and state laws and regulations, including
with respect to insurance, warranty, privacy, information security, data
protection, and taxation, and management's interpretation of and
compliance with such laws and regulations;
-- the structure, availability, and performance of Porch Reciprocal Exchange
(the "Reciprocal")'s and Homeowners of America ("HOA")'s reinsurance
programs to protect against loss and maintain their financial stability
ratings and a healthy surplus, the success of which are dependent on a
number of factors outside management's control;
-- the possibility that a decline in our share price would result in a
negative impact to the Reciprocal's surplus position and may require
further financial support to enable the Reciprocal to meet applicable
regulatory requirements and maintain financial stability rating;
-- uncertainties related to regulatory approval of insurance rates, policy
forms, insurance products, license applications, acquisitions of
businesses, or strategic initiative, and other matters within the purview
of insurance regulators (including the discount associated with the
shares contributed to HOA that were subsequently transferred to the
Reciprocal in connection with the closing of the sale of HOA to the
Reciprocal);
-- the ability of the Company and its affiliates to successfully operate and
manage the Reciprocal and our ability to successfully operate our
businesses alongside a reciprocal exchange;
-- our ability to implement our plans, forecasts and other expectations with
respect to the Reciprocal and to realize expected synergies and/or
convert policyholders from our existing insurance carrier business into
policyholders of the Reciprocal;
-- reliance on strategic, proprietary relationships to provide us with
access to personal data and product information, and the ability to use
such data and information to increase transaction volume and attract and
retain customers;
-- the ability to develop new, or enhance existing, products, services, and
features and bring them to market in a timely manner;
-- changes in capital requirements, and the ability to access capital when
needed to provide statutory surplus;
-- our ability to timely repay our outstanding indebtedness;
-- the increased costs and initiatives required to address new legal and
regulatory requirements arising from developments related to
cybersecurity, privacy, and data governance and the increased costs and
initiatives to protect against data breaches, cyber-attacks, virus or
malware attacks, or other infiltrations or incidents affecting system
integrity, availability, and performance;
-- retaining and attracting skilled and experienced employees;
-- costs related to being a public company; and
-- other risks and uncertainties discussed in Part II, Item 1A, "Risk
Factors," in our Annual Report on Form 10-K ("Annual Report") for the
year ended December 31, 2024 and in our subsequent reports filed with the
Securities and Exchange Commission ("SEC"), as well as those discussed
elsewhere in this earnings release, all of which are available on the
SEC's website at www.sec.gov.
We caution you that the foregoing list may not contain all the risks to forward-looking statements made in this release.
You should not rely upon forward-looking statements as predictions of future events. We have based the forward-looking statements contained in this release primarily on our current expectations and projections about future events and trends we believe may affect our business, financial condition, results of operations and prospects. The outcome of the events described in these forward-looking statements is subject to risks, uncertainties, and other factors, including those described above and elsewhere in this release. We disclaim any obligation to update publicly any forward-looking statements, whether in response to new information, future events, or otherwise, except as required by applicable law.
Non-GAAP Financial Measures
This release includes non-GAAP financial measures, such as Adjusted EBITDA (Loss), Adjusted EBITDA (Loss) Margin, and certain amounts related to Porch Shareholder Interest.
Our management uses these non-GAAP financial measures as supplemental measures of our operating and financial performance, for internal budgeting and forecasting purposes, to evaluate financial and strategic planning matters, and to establish certain performance goals for incentive programs. We believe that the use of these non-GAAP financial measures provides investors with useful information to evaluate our operating and financial performance and trends and in comparing our financial results with competitors, other similar companies and companies across different industries, many of which present similar non-GAAP financial measures to investors. However, our definitions and methodology in calculating these non-GAAP measures may not be comparable to those used by other companies. In addition, we may modify the presentation of these non-GAAP financial measures in the future, and any such modification may be material.
You should not consider these non-GAAP financial measures in isolation, as a substitute to or superior to financial performance measures determined in accordance with GAAP. The principal limitation of these non-GAAP financial measures is that they exclude specified income and expenses, some of which may be significant or material, that are required by GAAP to be recorded in our consolidated financial statements. We may also incur future income or expenses similar to those excluded from these non-GAAP financial measures, and the presentation of these measures should not be construed as an inference that future results will be unaffected by unusual or non-recurring items. In addition, these non-GAAP financial measures reflect the exercise of management judgment about which income and expenses are included or excluded in determining these non-GAAP financial measures.
You should review the tables accompanying this release for reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measure. We are not providing reconciliations of non-GAAP financial measures for future periods to the most directly comparable measures prepared in accordance with GAAP. We are unable to provide these reconciliations without unreasonable effort because certain information necessary to calculate such measures on a GAAP basis is unavailable or dependent on the timing of future events outside of our control.
Three Months Ended September 30, 2025
-------------------------------------------------------------------------------------------------------------------------------------------
Porch Eliminations
Shareholder Related to
(dollar amounts in Insurance Software Consumer Interest Reciprocal Reciprocal
thousands) Services & Data Services Corporate Eliminations (1) Subtotal (2) Segment Segment (3) Consolidated
----------------
Revenue $73,845 $24,635 $19,367 $ -- $ (2,773) $ 115,074 $ 51,941 $ (48,933) $ 118,082
Cost of revenue 11,595 6,480 2,758 -- (1) 20,832 11,509 (1,206) 31,135
------ ------ ------ ------- ------- -------- ------ -------- --------
Gross Profit 62,250 18,155 16,609 -- (2,772) 94,242 40,432 (47,727) 86,947
Gross Margin 84% 74% 86% --% 100% 82% 78% 98% 74%
Less: Operating
expenses:
Selling and
marketing 35,719 9,832 11,644 483 (2,772) 54,906 4,896 (29,622) 30,180
Product and
technology 2,583 4,864 1,224 4,121 -- 12,792 587 -- 13,379
General and
administrative 5,147 2,564 2,479 14,237 -- 24,427 20,731 (18,105) 27,053
------- ------- --- -------- ------ -------- --------
Operating income
(loss) (18,841) -- 2,117 14,218 -- 16,335
Other expense
(income) (5,240) (11) (109) 17,174 -- 11,814 1,181 -- 12,995
------- ------- --- -------- ------ -------- --------
Income (loss) before
income taxes (36,015) -- (9,697) 13,037 -- 3,340
Income tax benefit
(provision) (1,160) -- (1,160) (3,162) -- (4,322)
------- ------- --- -------- ------ -------- --------
Net income (loss) $(37,175) $ -- $ (10,857) $ 9,875 $ -- (982)
======= ======= === ======== ====== ========
Less: Net income
attributable to the
Reciprocal 9,875
--------
Net loss
attributable to
Porch $ (10,857)
========
Adjusted EBITDA
(Loss)
Reconciliation:
Net income (loss) $(37,175) $ (10,857) $ (982)
Less Reconciling
items:
Net income
attributable to
the Reciprocal -- 9,875
Depreciation and
amortization (84) (3,409) (808) (609) -- (4,910) (4,910)
Stock-based
compensation
expense (1,183) (593) (422) (4,983) -- (7,181) (7,181)
Gain (loss) on
extinguishment
of debt -- -- -- 361 -- 361 361
Interest expense -- -- -- (13,953) -- (13,953) (13,953)
Income tax
provision -- -- -- (1,160) -- (1,160) (1,160)
Mark-to-market
gains (losses) -- -- 8 (3,917) -- (3,909) (3,909)
Other gains and
losses 8 (220) 100 (619) -- (731) (731)
------ ------ ------ ------- -------- --------
Adjusted EBITDA
(Loss) (4) $25,300 $ 5,128 $ 2,493 $(12,295) $ 20,626 $ 20,626
====== ====== ====== ======= ======== ========
______________________________________
(1) The "Eliminations" column represents eliminations of transactions
between the Insurance Services segment, Software & Data segment,
Consumer Services segment, and Corporate.
(2) The "Porch Shareholder Interest Subtotal" column represents 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.
(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 for the "Corporate,"
"Porch Shareholder Interest Subtotal," and "Consolidated" columns. See
Adjusted EBITDA (Loss) sub-section for definition.
Three Months Ended September 30, 2024
---------------------------------------------------------------------------------------------------------------------------------------
Eliminations
Related to
(dollar amounts in Insurance Software Consumer Reciprocal Reciprocal
thousands) Services & Data Services Corporate Eliminations (1) Subtotal Segment Segment (2) Consolidated
----------- ----------- ----------- ------------ ---------------- ------------ -------------- ---------------- ----------------
Revenue $37,147 $23,127 $17,800 $ -- $ (382) $ 77,692 $ 49,153 $ (15,645) $ 111,200
Cost of revenue 27,488 5,826 4,285 -- (22) 37,577 17,708 (5,802) 49,483
------ ------ ------ ------- ----- ---- ------- ------ -------- --------
Gross Profit 9,659 17,301 13,515 -- (360) 40,115 31,445 (9,843) 61,717
Gross Margin 26% 75% 76% --% 94% 52% 64% 63% 56%
Less: Operating
expenses:
Selling and
marketing 12,081 10,136 6,683 426 (251) 29,075 8,001 (9,843) 27,233
Product and
technology 34 4,357 1,116 5,352 (109) 10,750 1,937 -- 12,687
General and
administrative 1,766 3,244 3,576 13,748 -- 22,334 1,967 -- 24,301
------- ----- ----- ------- ------ -------- --------
Operating income
(loss) (19,526) -- (22,044) 19,540 -- (2,504)
Other expense
(income) (1,481) 2 (193) (13,445) -- (15,117) (1,586) -- (16,703)
------- ----- ----- ------- ------ -------- --------
Income (loss) before
income taxes (6,081) -- (6,927) 21,126 -- 14,199
Income tax benefit
(provision) 183 -- 183 -- -- 183
------- ----- ----- ------- ------ -------- --------
Net income (loss) $ (5,898) $ -- $ (6,744) $ 21,126 $ -- $ 14,382
======= ===== ===== ======= ====== ======== ========
Adjusted EBITDA
(Loss)
Reconciliation:
Net income (loss) $ (5,898) $ (6,744) $ 14,382
Less: Reconciling
items:
Depreciation and
amortization (985) (3,648) (900) (510) -- (6,043) (6) -- (6,049)
Stock-based
compensation
expense (272) (1,194) (539) (4,730) -- (6,735) -- -- (6,735)
Gain (loss) on
extinguishment
of debt -- -- -- 22,545 -- 22,545 -- -- 22,545
Interest expense -- (2) 36 (10,916) -- (10,882) (1,618) 1,855 (10,645)
Income tax
provision -- -- -- 183 -- 183 -- -- 183
Mark-to-market
gains (losses) -- -- (143) (998) -- (1,141) -- -- (1,141)
Recoveries of
Losses on
Reinsurance
Contracts -- -- -- 350 -- 350 -- -- 350
Other gains and
losses (117) (607) 24 1,208 -- 508 286 (1,855) (1,061)
------ ------ ------ ------- ------- --------
Adjusted EBITDA
(Loss) (3) $(1,367) $ 5,013 $ 3,855 $(13,030) $ (5,529) $ 16,935
====== ====== ====== ======= ======= ========
______________________________________
(1) The "Eliminations" column represents eliminations of transactions
between the Insurance Services segment, Software & Data segment,
Consumer Services segment, and Corporate.
(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 for the "Corporate,"
"Subtotal," and "Consolidated" columns. See Adjusted EBITDA (Loss)
sub-section for definition.
Adjusted EBITDA (Loss)
We define Adjusted EBITDA (Loss) as net income (loss) adjusted for net income (loss) attributable to the Reciprocal; interest expense; income taxes; depreciation and amortization; gain or loss on extinguishment of debt; other expense; other income; impairments of intangible assets and goodwill; gain or loss on reinsurance contract; impairments of property, equipment, and software; stock-based compensation expense; mark-to-market gains or losses recognized on changes in the value of contingent consideration arrangements, unexercised warrants, and derivatives; restructuring and other costs; acquisition and other transaction costs; and non-cash bonus expense. Adjusted EBITDA (Loss) Margin is defined as Adjusted EBITDA (Loss) divided by total revenue.
The following table reconciles Net income (loss) to Adjusted EBITDA (Loss) and Net income (loss) as a percentage of revenue to Adjusted EBITDA (Loss) Margin for the periods presented (dollar amounts in thousands):
Three Months Ended September 30,
----------------------------------------
2025 2024
--------------------- -----------------
Amount Margin Amount Margin
Net income (loss) $ (982) (1)% $ 14,382 13%
Net loss (income)
attributable to the
Reciprocal (9,875) (8)% -- --%
Interest expense 13,953 12% 10,645 10%
Income tax provision
(benefit) 1,160 1% (183) --%
Depreciation and
amortization 4,910 4% 6,049 5%
Gain on extinguishment of
debt (361) --% (22,545) (20)%
Other income, net (118) --% (773) (1)%
Loss (gain) on
reinsurance contract -- --% (285) --%
Stock-based compensation
expense 7,181 6% 6,735 6%
Mark-to-market losses
(gains) 3,909 3% 1,140 1%
Restructuring and other
costs 837 1% 1,668 2%
Acquisition and other
transaction costs 12 --% 102 --%
-------- ------- -------- ------
Adjusted EBITDA (Loss) $ 20,626 17% $ 16,935 15%
======== ======= ======== ======
The impact of corporate expenses on Adjusted EBITDA (Loss) is also a non-GAAP financial measure. Reconciliations of these non-GAAP financial measures to the nearest GAAP measure are included in the preceding tables.
Porch Shareholder Interest
Certain amounts related to Porch Shareholder Interest are non-GAAP financial measures. We define Porch Shareholder Interest as the Insurance Services, Software & Data, and Consumer Services segments, together with corporate expenses.
The operating results of these segments comprise "Net income (loss) attributable to Porch" in our unaudited Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). Reconciliations of the following non-GAAP financial measures to the nearest GAAP measure are included in the tables within this section:
-- Porch Shareholder Interest Adjusted EBITDA (Loss) -- Porch Shareholder Interest Cost of Revenue -- Porch Shareholder Interest Depreciation and Amortization -- Porch Shareholder Interest General and Administrative -- Porch Shareholder Interest Gross Margin -- Porch Shareholder Interest Gross Profit -- Porch Shareholder Interest Income (Loss) Before Income Taxes -- Porch Shareholder Interest Income Tax Benefit (Provision) -- Porch Shareholder Interest Interest Expense -- Porch Shareholder Interest Mark-to-Market Losses (Gains) -- Porch Shareholder Interest Operating Income (Loss) -- Porch Shareholder Interest Other Expense (Income) -- Porch Shareholder Interest Other Gains and Losses -- Porch Shareholder Interest Product and Technology -- Porch Shareholder Interest Revenue -- Porch Shareholder Interest Selling and Marketing -- Porch Shareholder Interest Stock-based Compensation Expense
Reconciliations of the following non-GAAP financial measures to the nearest GAAP measure are included in the Supplemental Cash Flow Information section.
-- Porch Shareholder Interest net cash provided by (used in) financing
activities
-- Porch Shareholder Interest net cash provided by (used in) investing
activities
-- Porch Shareholder Interest net cash provided by (used in) operating
activities
Key Performance Indicators
In the management of these businesses, we identify, measure and evaluate various operating metrics. The key performance measures and operating metrics used in managing the businesses are discussed below. These key performance measures and operating metrics are not prepared in accordance with generally accepted accounting principles in the United States ("GAAP") and may not be comparable to or calculated in the same way as other similarly titled measures and metrics used by other companies.
Insurance Services
Reciprocal Written Premium ("RWP") -- We define RWP as the total premium written by the Reciprocal for the face value of one year's premium gross of cancellations, plus surplus contributions and policy fees, and before deductions for reinsurance in the period. RWP excludes the impact of cancellations and premiums ceded to reinsurers and includes surplus contributions and policy fees, and, therefore, should not be used as a substitute for revenue. We use RWP to manage the business because we believe it represents the business volume generated by associated customer acquisition activities and is reflective of the competitive market position when evaluated on a per written policy basis and is a key driver of both Porch and the Reciprocal's growth and profit opportunities.
Reciprocal Policies Written -- We define Reciprocal Policies Written as the number of new and renewal insurance policies written during the period by the Reciprocal Segment.
RWP per Policy Written -- We define RWP per Policy Written as the RWP in the period, which is reflective of the total amount a policyholder is expected to pay, divided by the Reciprocal Policies Written in the period.
Software & Data
Average Number of Companies -- We define Average Number of Companies as the straight-line average of the number of companies as of the end of period compared with the beginning of period across all of our Software & Data segment. This only includes the number of companies in our Software & Data segment.
Annualized Average Revenue per Company -- We define Annualized Average Revenue per Company as the revenue generated across the Software & Data segment in the period over the Average Number of Companies in the period, which is then annualized (for example, for a given quarter, multiplied by 4).
Consumer Services
Monetized Services -- We define Monetized Services as the total number of services from which we generated revenue, including, but not limited to, new and renewing warranty policies, completed moving jobs, sold security, TV/Internet or other home projects, measured over the period. This only includes services from Consumer Services segment and does not include insurance policies sold.
Average Revenue per Monetized Service -- We define Average Revenue per Monetized Service as total Consumer Services segment revenue generated in the period over the number of Monetized Services.
Change in Key Performance Indicator
Effective beginning with the quarter ended September 30, 2025, we have updated the definition of an operational metric, RWP, to include surplus contributions to the Reciprocal and policy fees. Management believes the revised definition reflects the total amount the policyholder is expected to pay and provides better insight to management. The primary reason for the change is the anticipated launch of the Porch Insurance product, where policyholders will pay a 10% surplus contribution in addition to traditional premium and fees. The updated definition ensures RWP aligns the operating metric with the full economic payment expected from the policyholder. The change in calculation methodology and updated definition did not result in a significant or material difference to the reported figures as compared to the definition utilized in prior quarters.
PORCH GROUP, INC.
Condensed Consolidated Balance Sheets (Unaudited)
(all numbers in thousands)
September 30, 2025 December 31, 2024
-------------------- ---------------------
Assets
Current assets
Cash and cash
equivalents $ 73,433 $ 167,643
Accounts receivable,
net 13,222 19,106
Short-term
investments 11,607 24,099
Reinsurance balance
due -- 92,303
Prepaid expenses and
other current
assets 9,912 32,837
Restricted cash and
cash equivalents 8,128 29,139
--- --------------- --- --------------
Total current
assets 116,302 365,127
Property, equipment, and
software, net 28,399 22,542
Goodwill 191,907 191,907
Long-term investments 38,895 158,652
Intangible assets, net 32,200 68,746
Other assets 6,839 6,994
Assets of Reciprocal: (1)
Cash and cash
equivalents,
including restricted 111,235 --
Accounts receivable,
net 7,243 --
Short-term
investments 3,767 --
Reinsurance balance
due 36,104 --
Prepaid expenses and
other current assets 16,484 --
Intangible assets,
net 24,282 --
Long-term investments 174,089 --
--- --------------- --- --------------
Total assets $ 787,746 $ 813,968
=== =============== === ==============
____________________________________
(1) Porch Reciprocal Exchange (the "Reciprocal") is a consolidated variable
interest entity not owned by Porch Group, Inc.
PORCH GROUP, INC.
Condensed Consolidated Balance Sheets (Unaudited) - Continued
(all numbers in thousands)
September 30, 2025 December 31, 2024
-------------------- ---------------------
Liabilities and
Stockholders' Equity
(Deficit)
Current liabilities
Accounts payable $ 4,593 $ 4,538
Accrued expenses and
other current
liabilities 56,961 41,245
Deferred revenue 4,540 248,669
Refundable customer
deposits 13,284 12,629
Current debt 7,762 150
Losses and loss
adjustment expense
reserves -- 67,785
Other insurance
liabilities,
current -- 39,140
--------------- --------------
Total current
liabilities 87,140 414,156
Long-term debt 379,368 403,788
Other liabilities 14,777 39,249
Liabilities of
Reciprocal: (1)
Accounts payable and
other current
liabilities 7,767 --
Deferred revenue 203,542 --
Losses and loss
adjustment expense
reserves 57,061 --
Other insurance
liabilities, current 26,715 --
Other liabilities 889 --
--------------- --------------
Total liabilities 777,259 857,193
--------------- --------------
Stockholders' equity
(deficit)
Common stock, $0.0001
par value per
share: 10 10
Additional paid-in
capital 616,511 717,066
Accumulated other
comprehensive income
(loss) 350 (5,446)
Accumulated deficit (644,790) (754,855)
--------------- --------------
Porch stockholders'
deficit (27,919) (43,225)
Noncontrolling
interest related to
the Reciprocal 38,406 --
--------------- --------------
Total stockholders'
equity (deficit) 10,487 (43,225)
--------------- --------------
Total liabilities and
stockholders' equity
(deficit) $ 787,746 $ 813,968
=============== ==============
______________________________________
(1) The Reciprocal is a consolidated variable interest entity not owned by
Porch Group, Inc.
PORCH GROUP, INC.
Condensed Consolidated Statements of Operations (Unaudited)
(all numbers in thousands except per share amounts)
Three Months Ended September 30,
------------------------------------------
2025 2024
--------------------- -------------------
Revenue $ 118,082 $ 111,200
Cost of revenue 31,135 49,483
------------- ------------
Gross profit 86,947 61,717
Operating expenses:
Selling and marketing 30,180 27,233
Product and technology 13,379 12,687
General and administrative 27,053 24,301
------------- ------------
Total operating expenses 70,612 64,221
------------- ------------
Operating income (loss) 16,335 (2,504)
Other income (expense):
Interest expense (13,963) (10,645)
Change in fair value of
private warrant
liability (5,702) 50
Change in fair value of
derivatives 1,785 (1,048)
Gain on extinguishment of
debt 361 22,545
Investment income and
realized gains and
losses, net of investment
expenses 2,989 3,787
Other income, net 1,535 2,014
------------- ------------
Total other income (expense) (12,995) 16,703
------------- ------------
Income (loss) before income
taxes 3,340 14,199
Income tax provision (4,322) 183
------------- ------------
Net income (loss) (982) 14,382
Less: Net income attributable to
the Reciprocal 9,875 --
------------- ------------
Net income (loss) attributable
to Porch $ (10,857) $ 14,382
============= ============
Earnings Per Share - Basic
Net income (loss) attributable
to Porch per share - basic $ (0.10) $ 0.14
Weighted average shares
outstanding used to compute net
income (loss) attributable to
Porch per share - basic 104,301 100,430
Earnings Per Share - Diluted
Net income (loss) attributable
to Porch per share - diluted $ (0.10) $ 0.12
Weighted average shares
outstanding used to compute net
income (loss) attributable to
Porch per share - diluted 104,301 124,033
The following table summarizes Porch Shareholder Interest results.
Three Months Ended September 30,
------------------------------------------
2025 2024 Change
-------------- ------------- -----------
Porch Shareholder
Interest
Revenue (1) $ 115,074 $ 77,692 $ 37,382
Porch Shareholder
Interest Gross
Profit (1) 94,242 40,115 54,127
Porch Shareholder
Interest
Adjusted EBITDA
(Loss) (1) 20,626 (5,529) 26,155
______________________________________
(1) Porch Shareholder Interest Revenue, Gross Profit, and Adjusted EBITDA
(Loss) are non-GAAP measures. For the three months ended September 30,
2025, Porch Shareholder Interest Adjusted EBITDA (Loss) is equivalent
to total Adjusted EBITDA (Loss) for consolidated Porch, as Porch no
longer owns HOA following its sale to the Reciprocal on January 1,
2025. See Non-GAAP Financial Measures section.
PORCH GROUP, INC.
Supplemental Cash Flow Information (Unaudited)
(all numbers in thousands)
The following table provides further detail of cash flows of Porch Group and cash
flows of the Reciprocal Segment for the three and nine months ended September 30,
2025.
Three Months Porch
Ended September Reciprocal Shareholder
30, 2025 Consolidated Segment Eliminations Interest (1)
---------------- ---------------- ------------ -------------- ----------------
Net cash provided
by (used in)
operating
activities $ 40,827 $ 11,982 $ -- $ 28,845
-------- ------- ---------- --------
Cash flows from
investing
activities:
Purchases of
property and
equipment
and
capitalized
software
development
costs (3,848) -- -- (3,848)
Maturities,
sales,
(purchases)
of
investments,
net (21,511) (4,142) -- (17,369)
Proceeds from
sale of
business 1,217 -- -- 1,217
-------- ------- ---------- --------
Net cash provided
by (used in)
investing
activities (24,142) (4,142) -- (20,000)
-------- ------- ---------- --------
Cash flows from
financing
activities:
Repayments of
principal (12,306) -- -- (12,306)
Other
financing
activities 524 -- -- 524
-------- ------- ---------- --------
Net cash provided
by (used in)
financing
activities (11,782) -- -- (11,782)
-------- ------- ---------- --------
Net change in
cash and cash
equivalents &
restricted cash
and cash
equivalents 4,903 7,840 -- (2,937)
Cash and cash
equivalents &
restricted cash
and cash
equivalents,
beginning of
period 187,893 103,395 -- 84,498
-------- ------- ---------- --------
Cash and cash
equivalents &
restricted cash
and cash
equivalents, end
of period $ 192,796 $ 111,235 $ -- $ 81,561
======== ======= ========== ========
Supplemental
disclosures
Cash received
(paid) for
interest on
intercompany
surplus notes $ -- $ (9,181) $ -- $ 9,181
Nine Months Porch
Ended September Reciprocal Shareholder
30, 2025 Consolidated Segment Eliminations Interest (1)
---------------- ---------------- ------------ ---------------- ----------------
Net cash provided
by (used in)
operating
activities $ 65,218 $ (5,696) $ -- $ 70,914
-------- ------- -------- --------
Cash flows from
investing
activities:
Purchases of
property and
equipment
and
capitalized
software
development
costs (10,875) (6) -- (10,869)
Maturities,
sales,
(purchases)
of
investments,
net (39,753) (5,075) -- (34,678)
Proceeds from
sale of
business 1,217 -- -- 1,217
Issuance of
surplus note
to
Reciprocal -- -- 46,813 (46,813)
Sale of HOA
to the
Reciprocal -- (46,813) -- 46,813
-------- ------- -------- --------
Net cash provided
by (used in)
investing
activities (49,411) (51,894) 46,813 (44,330)
-------- ------- -------- --------
Cash flows from
financing
activities:
Proceeds from
surplus note
with Porch -- 46,813 (46,813) --
Proceeds from
debt
issuance 51,000 -- -- 51,000
Repayments of
principal (68,164) -- -- (68,164)
Other
financing
activities (2,629) -- -- (2,629)
-------- ------- -------- --------
Net cash provided
by (used in)
financing
activities (19,793) 46,813 (46,813) (19,793)
-------- ------- -------- --------
Net change in
cash and cash
equivalents &
restricted cash
and cash
equivalents (3,986) (10,777) -- 6,791
Cash and cash
equivalents &
restricted cash
and cash
equivalents,
beginning of
period 196,782 122,012 -- 74,770
-------- ------- -------- --------
Cash and cash
equivalents &
restricted cash
and cash
equivalents, end
of period $ 192,796 $ 111,235 $ -- $ 81,561
======== ======= ======== ========
Supplemental
disclosures
Cash received
(paid) for
interest on
intercompany
surplus notes $ -- $ (9,181) $ -- $ 9,181
View source version on businesswire.com: https://www.businesswire.com/news/home/20251105000353/en/
CONTACT: Investor Relations Contact
IR@porch.com
(END) Dow Jones Newswires
November 05, 2025 16:02 ET (21:02 GMT)
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