Quarterly Earnings Supplement Q4 2025 Total Subscription Revenue Growth $3.1 $4.4 $5.3 $6.3 $7.6 $8.8 $9.9 $10.7 $12.0 $13.2 $14.5 $15.7 $17.0 $18.4 $20.0 $21.4 $22.9 $24.9 $27.1 $28.6 $30.1 $32.2 $34.4 $36.7 $39.1 $42.2 $44.6 $47.4 $50.2 $52.6 $56.5 $59.0 $61.5 $63.9 $67.4 $70.9 $74.2 $77.7 $82.6 $86.6 $89.5 $92.5 $99.4 $106.4 $113.3 $120.4 $127.1 $134.1 $139.8 $145.8 $152.4 $158.6 $165.2 $173.3 $182.9 $191.5 $201.1 $208.6 $219.0 $227.8 $233.1 $242.2 $252.7 $261.4 $0 $50.0 $100.0 $150.0 $200.0 $250.0 $300. ...

Core Insights - Trupanion, Inc. reported strong financial results for Q4 and the full year 2025, achieving a total revenue of $376.9 million in Q4, a 12% increase year-over-year, and $1.439 billion for the full year, also a 12% increase compared to 2024 [7][20] - The company reached its annual margin target of 15% in 2025, while subscription revenue grew by 15% in Q4 and 16% for the full year [2][7] - Trupanion's net income for Q4 was $5.6 million, or $0.13 per share, compared to $1.7 million, or $0.04 per share, in Q4 2024, and for the full year, net income was $19.4 million, a significant turnaround from a net loss of $9.6 million in 2024 [7][20] Financial Highlights - Total revenue for Q4 2025 was $376.9 million, up 12% from Q4 2024, while full-year revenue reached $1.439 billion, also a 12% increase [7][20] - Subscription business revenue in Q4 was $261.4 million, a 15% increase year-over-year, and $989.3 million for the full year, a 16% increase [7][20] - Adjusted EBITDA for Q4 was $21.8 million, compared to $19.4 million in Q4 2024, and for the full year, it was $70.1 million, up from $46.1 million in 2024 [7][20] Operational Metrics - Total enrolled pets as of December 31, 2025, was 1,647,565, a decrease of 2% from the previous year, while subscription enrolled pets increased by 5% to 1,096,173 [7][20] - Monthly average revenue per pet rose to $80.79 in 2025 from $72.98 in 2024, and the average pet acquisition cost increased to $288 from $235 [20] - The average monthly retention rate improved slightly to 98.34% in 2025 from 98.25% in 2024 [20] Cash Flow and Investments - Operating cash flow for Q4 2025 was $29.3 million, compared to $23.7 million in Q4 2024, and for the full year, it was $89.5 million, up from $48.3 million in 2024 [7][20] - Free cash flow for Q4 was $25.3 million, an increase from $21.8 million in Q4 2024, and for the full year, it was $75.4 million, compared to $38.6 million in 2024 [7][20] - The company held $370.7 million in cash and short-term investments as of December 31, 2025, with $50 million held outside insurance entities [7][20]

Financial Performance - Total revenue for Q4 2025 was $376.9 million, a 12% increase compared to Q4 2024[7] - Subscription business revenue reached $261.4 million in Q4 2025, up 15% from Q4 2024[7] - Net income for Q4 2025 was $5.6 million, or $0.13 per share, compared to $1.7 million, or $0.04 per share, in Q4 2024[7] - Adjusted EBITDA for Q4 2025 was $21.8 million, an increase from $19.4 million in Q4 2024[7] - Full year 2025 total revenue was $1,439.3 million, a 12% increase compared to 2024[7] - Full year subscription business revenue was $989.3 million, up 16% from 2024[7] - Operating income for the year ended December 31, 2025, was $13.8 million, a recovery from an operating loss of $9.5 million in 2024[18] - Net cash provided by operating activities for the year ended December 31, 2025, was $89.5 million, compared to $48.3 million in 2024[22] - The company reported a net income of $19,433,000 for the year 2025, a turnaround from a net loss of $9,633,000 in 2024[31] Subscription Metrics - Subscription enrolled pets increased by 5% to 1,096,173 as of December 31, 2025[7] - Subscription adjusted operating income for the year ended December 31, 2025 was $145,616,000, up from $108,313,000 in 2024, reflecting a 34.5% increase[26] - Subscription revenue for Q4 2025 reached $261,422,000, up from $227,783,000 in Q4 2024, representing a growth of 14.7% year-over-year[27] - Subscription adjusted operating income margin improved to 16.5% in Q4 2025 from 15.3% in Q4 2024, highlighting enhanced profitability in the subscription segment[27] Operational Efficiency - Operating cash flow for Q4 2025 was $29.3 million, compared to $23.7 million in Q4 2024[7] - Total operating expenses for Q4 2025 were $57.9 million, an increase from $52.6 million in Q4 2024[18] - The cost of paying veterinary invoices as a percentage of revenue decreased to 69.6% in 2025 from 72.6% in 2024, indicating improved cost efficiency[27] - Adjusted EBITDA for the year ended December 31, 2025, was $70,145,000, compared to $46,123,000 in 2024, showing significant operational improvement[31] Assets and Liabilities - The company held $370.7 million in cash and short-term investments as of December 31, 2025[12] - Total assets increased to $915.0 million as of December 31, 2025, compared to $806.9 million in 2024[20] - Total liabilities rose to $531.1 million in 2025, up from $483.6 million in 2024[20] Pet Enrollment and Acquisition - Total enrolled pets as of December 31, 2025, was 1,647,565, a decrease of 2% from December 31, 2024[7] - Total pets enrolled at the end of 2025 reached 1,647,565, a decrease of 1.8% from 1,677,570 in 2024[24] - Average pet acquisition cost (PAC) increased to $288 in 2025, up 22.6% from $235 in 2024[24] Cash Flow and Expenses - Free cash flow for the year ended December 31, 2025 was $75,359,000, compared to $38,571,000 in 2024, representing a 95.5% increase[24] - Veterinary invoice expenses for the year ended December 31, 2025 totaled $1,028,975,000, an increase from $949,148,000 in 2024[25] - Technology and development expenses for the year ended December 31, 2025 were $37,848,000, up from $31,255,000 in 2024, showing a 20.9% increase[25] Management Insights - Management emphasizes the importance of adjusted operating income as a key performance indicator to assess operational efficiency and growth potential[29] - The company expects acquisition costs and development expenses to remain recurring, impacting future adjusted operating income metrics[28]

Core Viewpoint - Trupanion, Inc. is experiencing a potential shift in investor sentiment following a strong earnings report and technical indicators suggesting a trend reversal [2][3][4][5]. Group 1: Company Overview - Trupanion, Inc. is a leading provider of medical insurance for pets, focusing on cats and dogs, and operates in the United States, Canada, Puerto Rico, and Australia [1]. Group 2: Stock Performance and Analyst Sentiment - The consensus price target for Trupanion has decreased from an average of $51.75 to $40 over the past year, indicating increased caution among analysts regarding the stock's performance [2]. - Despite the downward trend in price targets, recent developments, including a hammer chart pattern and upward revisions in earnings estimates, suggest a potential trend reversal [3][6]. - Analyst John Barnidge from Piper Sandler has set a price target of $156 for Trupanion, reflecting a positive outlook for the stock [3][5]. Group 3: Financial Performance - In the Q3 2025 earnings call, Trupanion reported earnings of $0.13 per share, exceeding the Zacks Consensus Estimate of $0.06 per share and showing significant improvement from $0.03 per share in the same quarter last year [4]. - The positive earnings report has contributed to increased investor confidence and an upgrade to a Zacks Rank 1 (Strong Buy) [5][6].

Core Insights - Trupanion has received two Stevie Awards for Sales & Customer Service, highlighting its excellence in customer support and service innovation [1][2][4] Company Overview - Trupanion is a leader in medical insurance for pets in North America, with over 1,000,000 pets currently enrolled [8] - The company has been operational for over two decades, providing pet owners with peace of mind through unlimited payouts for the life of their pets [8] - Trupanion is listed on NASDAQ under the symbol "TRUP" and is headquartered in Seattle, WA [8] Customer Service Excellence - Trupanion achieved a monthly retention rate of approximately 98%, indicating strong customer loyalty [7] - The company offers 24/7/365 support, having assisted 50,000 members during overnight hours in 2025 alone [7] - Nearly 78% of inquiries are resolved on the first call, reducing stress and wait times for pet parents [7] Direct Payment Innovation - Trupanion has paid over 2.1 million claims directly to veterinary practices, often within seconds, enhancing the customer experience by eliminating upfront costs [7] Recognition and Awards - The Stevie Award judges commended Trupanion for its empathetic, pet-centric service and operational success [4] - The awards reflect Trupanion's commitment to delivering exceptional member experiences through innovative support [2][4]

Core Viewpoint - Trupanion (TRUP) has experienced a bearish trend with a 13.5% loss over the past four weeks, but the formation of a hammer chart pattern suggests a potential trend reversal as buying interest may be increasing [1][2]. Technical Analysis - The hammer chart pattern indicates a potential bottom in a downtrend, characterized by a small candle body and a long lower wick, suggesting that bears may be losing control [4][5]. - This pattern typically forms when a stock opens lower, makes a new low, but then finds support and closes near its opening price, indicating a possible shift in momentum [4][5]. Fundamental Analysis - There is rising optimism among Wall Street analysts regarding Trupanion's future earnings, which supports the potential for a trend reversal [2][7]. - The consensus EPS estimate for Trupanion has increased by 0.7% over the last 30 days, indicating analysts' agreement on the company's improved earnings potential [8]. - Trupanion holds a Zacks Rank of 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks, which historically outperform the market [9][10].

Core Insights - Chewy, primarily known as an online pet product retailer, also provides pet insurance through partnerships with Lemonade and Trupanion, offering various coverage options [1][2] Pet Insurance Overview - Chewy's pet insurance includes accident-only, accident and illness, and wellness coverage, with specific plans varying by state and insurer [1][2] - Trupanion offers unlimited annual coverage for eligible vet expenses, while Lemonade has a cap of $20,000 per year [2][4] Coverage Details - Chewy CarePlus plans cover accidents and illnesses, including lacerations, cancer, hospitalization, and prescription medications, with optional wellness plans for routine care [6][10] - Lemonade's accident and illness policies include three tiers: Base, Value, and Value Plus, with the Base plan providing the least coverage [7][10] - Trupanion's Essential Accident & Illness plan covers a wide range of conditions, while the Complete plan includes additional coverage for chronic conditions and diabetes [11][12] Waiting Periods and Age Restrictions - Lemonade has a waiting period of 14 days for illness coverage and 12:01 a.m. the day after purchase for accident coverage, with a maximum pet age of 11 years [8][22] - Trupanion has a 5-day waiting period for accidents and no maximum age limit for pets [8][22] Cost and Discounts - The average monthly premium for Chewy pet insurance through Lemonade with a $5,000 annual limit is $70.62, while Trupanion's unlimited coverage averages $184.97 per month, which is above average [27][28] - Chewy offers a multi-pet discount of 10% for insuring more than one pet, which is competitive in the market [28] Claims Process - Claims for Lemonade can be filed through their mobile app, while Trupanion allows direct vet payments if the vet accepts them [31][34] - Lemonade customers have 180 days to submit claims, whereas Trupanion customers have 90 days [33] Customer Support and Accessibility - Chewy's pet insurance is available nationwide, with Lemonade in 41 states and Trupanion in all 50 states [39] - Chewy provides a customer service line for inquiries related to CarePlus insurance [41]

Core Insights - State Farm has partnered with Trupanion to provide pet insurance, offering an accident and illness plan that covers various vet expenses but lacks a wellness plan for routine care [1][4][14] Pet Insurance Overview - The average cost of State Farm pet insurance is significantly higher than most competitors, with an average premium of $307.34 for unlimited annual coverage [2][19] - State Farm does not offer any discounts for pet insurance, including multi-pet discounts, which are commonly provided by other insurers [20] Coverage Details - State Farm's pet insurance includes unlimited annual coverage, a lifetime deductible, and 90% reimbursement for covered treatments [4][6] - The policy covers a range of illnesses and accidents, including broken bones, cancer, and allergies, but does not cover preexisting conditions [10][14] - Optional add-ons are available through Trupanion for additional coverage not included in the base policy [7] Claims and Payment - Trupanion handles all claims for State Farm pet insurance, with over 60% of direct vet payments made within 60 seconds and over 70% of manual claims paid within 24 hours [24] - Policyholders have 90 days from the date of treatment to submit a claim [23] Policy Management - State Farm does not require an initial exam to enroll in an accident and illness plan, but a dental exam is necessary for dental illness coverage [27] - Policyholders can adjust their coverage within specific timeframes after the policy's start date [22]

Core Viewpoint - Trupanion (TRUP) has been upgraded to a Zacks Rank 1 (Strong Buy), indicating a positive outlook based on rising earnings estimates, which significantly influence stock prices [1][3]. Earnings Estimates and Stock Impact - The Zacks rating system focuses on changes in earnings estimates, which are strongly correlated with near-term stock price movements, particularly due to institutional investors' reliance on these estimates for valuation [4][6]. - Trupanion's rising earnings estimates and the subsequent rating upgrade suggest an improvement in the company's underlying business, likely leading to an increase in stock price [5][10]. Zacks Rank System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with Zacks Rank 1 stocks historically generating an average annual return of +25% since 1988 [7]. - Only the top 5% of Zacks-covered stocks receive a "Strong Buy" rating, indicating superior earnings estimate revisions, which positions Trupanion favorably for potential market-beating returns [9][10]. Earnings Estimate Revisions for Trupanion - Trupanion is expected to earn $0.48 per share for the fiscal year ending December 2025, with no year-over-year change, while the Zacks Consensus Estimate has increased by 46.9% over the past three months [8].

Core Insights - Trupanion, Inc. is celebrating its 25th anniversary as a leading provider of pet medical insurance in North America, having transformed pet care for over 3.8 million pet parents globally [1][2] Company Overview - Trupanion has evolved from a startup to a global leader, currently protecting over one million pets and being the only insurer in North America that pays veterinarians directly at checkout, often within seconds [2][3] - The company has enabled over $3.5 billion in veterinary care worldwide and boasts a 98%+ monthly retention rate, reflecting strong trust from its members [3] Key Achievements - Over 3.8 million pets have been protected, with more than $3.6 billion in invoices paid [5] - Trupanion has processed over 2.1 million claims in under 60 seconds and nearly 2.5 million claims in under 5 minutes [5] - The company has paid more than $1.5 billion directly to veterinary practices, showcasing its commitment to seamless care [5] Innovations and Services - Trupanion is the first and only provider in North America with patented technology (VetDirect Pay™) to pay veterinarians directly at the time of checkout [5] - The company introduced the "Lifetime" deductible, covering specific conditions for the life of the pet, and offers unlimited payouts for the life of the pet [9] Community and Public Health Initiatives - Trupanion founded Veterinary Appreciation Day in 2015 to honor veterinary professionals and has partnered with the CDC to enhance public health through its Pet & Public Health Early Warning & Detection System [9]