Q4 2025 Earnings Presentation February 11, 2026 Copyright 2026 Porch Group, Inc. All rights reserved Disclaimers Financial Targets Porch is providing guidance and targets for future periods in this presentation, based on current market conditions, assumptions, and expectations as of the date of this presentation. Actual results may vary due to a number of factors, and there is no guarantee that we will be able to achieve these results. Please refer to the below for important disclaimers and a description of ...

Financial Performance - Porch Group reported Q4 2025 revenue of $112.3 million, with a net loss of $(3.5) million and Adjusted EBITDA of $23.5 million[2]. - The Porch Shareholder Interest Gross Profit for Q4 2025 was $91.4 million, reflecting a 6% increase from Q4 2024's $86.3 million[5]. - Revenue for the three months ended December 31, 2025, was $124.304 million, with a gross profit of $95.734 million, resulting in a gross margin of 77%[30]. - Adjusted EBITDA for the same period was $23.487 million, indicating a significant operational performance[30]. - Total revenue for the year ended December 31, 2025, was $482.414 million, with Insurance Services contributing $266.726 million, Software & Data $92.935 million, and Consumer Services $68.374 million[37]. - Gross profit reached $339.990 million, resulting in a consolidated gross margin of 70%[37]. - The company reported a net loss of $3.361 million attributable to Porch, with a total net loss of $99.441 million[37]. - Adjusted EBITDA for the consolidated segment was $76.604 million, indicating a significant operational loss of $46.828 million[40]. - The company reported a net loss attributable to Porch of $3,478,000 for the three months ended December 31, 2025[68]. Growth and Projections - The company achieved a 25% year-over-year organic growth target for Reciprocal Written Premium, aiming for $600 million in 2026[4]. - The company expects 2026 revenue guidance of $475 million to $490 million, representing a 13% to 17% year-over-year growth[13]. - Adjusted EBITDA for 2026 is projected to be between $98 million and $105 million, indicating a 28% to 37% increase from 2025[13]. - Porch Shareholder Interest revenue for the year ended December 31, 2025, was $418,891,000, a 33.7% increase from $313,275,000 in 2024[70]. - Gross profit for the year ended December 31, 2025, was $339,990,000, up from $201,928,000 in 2024, representing a 68.1% increase[68]. Operational Metrics - The company reported a net cash provided by operating activities for the year ended December 31, 2025, was $66,419 million, with a significant contribution of $65,427 million attributed to Porch Shareholder[74]. - Cash flow from operations for Porch Shareholder Interest was $65.4 million for the year, driven by Adjusted EBITDA of $76.6 million[10]. - Active agencies and quotes in Q4 2025 rose over 100% compared to Q4 2024, indicating strong top-of-funnel momentum[6]. - The company incurred a provision for doubtful accounts of $1.8 million on a consolidated basis[32]. - The company experienced a mark-to-market gain of $16,540,000 during the period[34]. Expenses and Losses - Selling and marketing expenses totaled $52.311 million, reflecting the company's investment in growth initiatives[30]. - Operating expenses totaled $139.578 million, with selling and marketing expenses accounting for $195.225 million, and product and technology expenses at $53.317 million[37]. - The company reported a significant interest expense of $42.536 million, impacting overall profitability[45]. - The company incurred other expenses totaling $9.835 million, impacting overall profitability[37]. - The company reported a net cash used in financing activities of $22,169 million, which included $51,000 million from debt issuance and $68,164 million in principal repayments[74]. Strategic Initiatives - The company emphasizes the importance of developing new products and enhancing existing services to drive future growth[30]. - The management highlighted the need to manage growth effectively to build a strong consumer brand[30]. - The company is focusing on market expansion and new product development as part of its strategic initiatives[38]. - The company plans to focus on expanding its market presence and enhancing product offerings to drive future growth[44]. Risks and Challenges - The company faces various risks, including regulatory uncertainties and economic conditions that could impact future performance[30]. - The total operating income (loss) was $(20,621,000), indicating challenges in managing operational costs[34].

Group 1 - Porch Group Inc. stock price is currently at $10.44, reflecting a 0.29% drop in the current market session, but has increased by 5.35% over the past month and 75.95% over the past year [1] - The P/E ratio of Porch Group is 33.77, which is higher than the aggregate P/E ratio of 24.63 for the Software industry, suggesting that investors may expect better future performance from Porch Group compared to its peers [4] - A higher P/E ratio may indicate that the stock is overvalued, but it could also reflect investor optimism about future performance and potential dividend increases [3][4] Group 2 - The P/E ratio is a useful metric for evaluating a company's market performance, but it should be used cautiously as it can indicate both undervaluation and weak growth prospects [6] - Investors should consider the P/E ratio alongside other financial ratios, industry trends, and qualitative factors for a comprehensive analysis of a company's financial health [6]

Core Insights - First Principles Partners specializes in equity research focused on technology, innovation, and sustainability investment, utilizing a unique approach that breaks down complex problems to their basic elements [1] Group 1: Investment Strategy - The "First Principles" approach enables the identification of overlooked investment opportunities by analyzing financial and technological fundamentals [1] - The firm has a strong background in investment, private equity, and venture capital, demonstrating a proven track record of delivering strong returns [1] Group 2: Focus Areas - Articles published on Seeking Alpha emphasize emerging technologies, sustainable investing, and the intersection of innovation and finance [1] - The company aims to share insights with a broader audience and engage with fellow investors to promote positive change and sustainability [1]

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Market Overview - The CE 100 Index decreased by 3.5% over the week, with only the Banking segment and the Be Well pillar showing a slight increase of 0.5% [1] - The tech-heavy Nasdaq fell by 3.3%, primarily affecting companies leveraging artificial intelligence (AI) for growth, including major players like Microsoft and Meta, which both dropped over 4% [2] Index Performance - The 5-day performance for major indices showed CE 100 down 3.45%, Nasdaq down 3.29%, S&P 500 down 1.80%, and Dow down 1.27% [3] - Year-to-date (YTD) performance indicated CE 100 up 12.60%, Nasdaq up 19.00%, S&P 500 up 14.28%, and Dow up 10.37% [3] - Over the past year, CE 100 increased by 14.02%, while Nasdaq rose by 18.46%, S&P 500 by 12.45%, and Dow by 7.37% [3] Company Highlights - Pinterest's stock fell by 19.4%, despite CEO Bill Ready's assertion that the company is transforming into an "AI-powered visual-first shopping assistant," with AI integrated into various platform features [5][6] - Pinterest reported a 17% increase in third-quarter revenue to $1 billion, slightly surpassing Wall Street expectations, and a 12% rise in monthly active users to 600 million [7] - Cogent's shares plummeted over 41%, contributing to a 4% decline in the Enablers pillar, which includes several Big Tech companies [7] - Porch Group's Q3 revenue was reported at $115.1 million with an 82% gross margin, but shares dropped more than 30% during the week [8] - Affirm's gross merchandise volume (GMV) surged by 42% to $10.8 billion, with revenue increasing by 34% to $933 million, and active cardholders growing by 500,000 to 2.8 million [9][10] - FIS shares rose by 3.6%, reporting adjusted revenue of $2.7 billion, up 6.3%, with strong performance in banking and digital banking activities [11] - Sezzle achieved its first billion-dollar quarter in Q3, with GMV rising 58.7% year over year to $1 billion and total revenue climbing 67% to $116.8 million [13] - Uber Technologies reported a 22% year-over-year growth in total trips and a 21% increase in gross bookings, although shares fell by 5% [14]

Market Overview - U.S. equity markets faced a downturn on November 6, 2025, driven by concerns over AI valuations, with the Nasdaq Composite falling 1.9%, S&P 500 down 1.1%, and Dow Jones Industrial Average decreasing by 0.8% [1] - The S&P 500 has increased by 1.23% over the past month and 13.79% year-over-year, reaching an all-time high of 6921.75 in October 2025, indicating a potential market recalibration due to skepticism surrounding AI valuations [2] Economic Context - The ongoing U.S. government shutdown, the longest on record, has limited the release of key economic indicators, creating uncertainty in the market and amplifying the significance of corporate earnings reports [3] - A report from Challenger, Gray & Christmas indicated that U.S. employers announced 153,074 job cuts in October, the highest for that month since 2003, which has led to increased expectations for a Federal Reserve rate cut in December [4] Upcoming Economic Indicators - Investors are closely monitoring upcoming economic data, including U.S. Nonfarm Productivity and Average Hourly Earnings, as well as Federal Reserve speeches that may provide insights into the economic impact of AI [5] Company-Specific News - Tesla (TSLA) shares fell 3.5% amid concerns over CEO Elon Musk's pay package, while Nvidia (NVDA) dropped 3.7% and Palantir Technologies (PLTR) decreased by 6.8% due to AI valuation concerns [7] - Datadog (DDOG) surged 23% after reporting strong quarterly results, while Snap (SNAP) rose nearly 10% following a $500 million share buyback announcement [8][9] - Conversely, Duolingo (DUOL) plummeted 27%, and DoorDash (DASH) sank 17% after warnings of increased spending [10] - e.l.f. Beauty (ELF) saw a significant drop of 33.45% due to disappointing revenue and guidance, while Haemonetics (HAE) rose 22.4% after exceeding expectations [11][12] Summary of Earnings Reports - WSP Global Inc. reported strong Q3 2025 results, while ConocoPhillips and Air Products and Chemicals also exceeded earnings expectations, contributing to market volatility [13]

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Core Insights - Porch Group, Inc. reported $115.07 million in revenue for Q3 2025, a year-over-year increase of 3.5% [1] - The EPS for the same period was -$0.10, compared to -$0.02 a year ago, indicating a decline in earnings [1] - The revenue exceeded the Zacks Consensus Estimate by 4.87%, while the EPS fell short by 25% [1] Revenue Breakdown - Insurance Services revenue was $73.85 million, surpassing the average estimate of $66.7 million [4] - Software & Data revenue reached $24.64 million, slightly below the estimated $25.6 million [4] - The total revenue from Porch Shareholder Interest was $115.07 million, exceeding the estimate of $109.74 million [4] - Eliminations accounted for a revenue of -$2.77 million, worse than the average estimate of -$2.02 million [4] - Consumer Services revenue was $19.37 million, slightly below the average estimate of $19.45 million [4] Stock Performance - Porch Group's shares have returned -7.8% over the past month, contrasting with the Zacks S&P 500 composite's +1% change [3] - The stock currently holds a Zacks Rank 4 (Sell), suggesting potential underperformance in the near term [3]

Core Viewpoint - Porch Group, Inc. reported a quarterly loss of $0.1 per share, which was worse than the Zacks Consensus Estimate of a loss of $0.08, marking a 25% earnings surprise [1]. Financial Performance - The company posted revenues of $115.07 million for the quarter ended September 2025, exceeding the Zacks Consensus Estimate by 4.87% and showing an increase from $111.2 million year-over-year [2]. - Over the last four quarters, Porch Group has surpassed consensus EPS estimates three times [2]. Stock Performance - Porch Group shares have increased approximately 197% since the beginning of the year, significantly outperforming the S&P 500's gain of 15.1% [3]. Future Outlook - The company's earnings outlook will be crucial for determining future stock movements, with current consensus EPS estimates at -$0.07 for the coming quarter and -$0.04 for the current fiscal year [7]. - The Zacks Rank for Porch Group is currently 4 (Sell), indicating expectations of underperformance in the near future [6]. Industry Context - The Internet - Software industry, to which Porch Group belongs, is currently ranked in the top 34% of over 250 Zacks industries, suggesting a favorable environment for stocks in this sector [8].