Hippo (HIPO) Q1 2025 earnings summary

Executive summary

• Q1 2025 revenue grew 30% year-over-year to $110–$110.3 million, driven by strong performance in insurance-as-a-service and Hippo Home Insurance Program segments, as well as growth in the homebuilder channel and premium retention.

• Net loss increased to $47.7–$48 million, primarily due to $44.1–$45 million in LA Wildfires-related catastrophe losses.

• Adjusted EBITDA loss widened to $41–$41.1 million, reflecting higher loss and loss adjustment expenses from the wildfires.

• Gross written premium rose 8% year-over-year to $210.9 million, with the homebuilder channel up 35% and written premium outside the main program up 21%.

• Maintained strong liquidity with $528 million in cash and investments (excluding restricted cash) and $198 million Spinnaker surplus.

Financial highlights

• Insurance-as-a-service revenue surged 91% year-over-year to $38.9–$39 million; HHIP revenue up 12% to $61.9–$62 million.

• Net earned premium increased 44% year-over-year to $87.3 million; commission income declined 9% to $14.4 million.

• Gross loss ratio rose to 95% (up from 59%); net loss ratio reached 106% (up from 87%), both driven by LA Wildfires.

• Operating expenses declined by $7 million year-over-year, falling from 48% to 30% of revenue.

• Net investment income was stable at $5.8 million.

Outlook and guidance

• Guidance for full year 2025: revenue of $465–$475 million, adjusted EBITDA loss of $35–$39 million, net loss of $65–$69 million.

• Projected to achieve annual run rate of over $500 million in revenue and net profit by Q4 2025.

• Investor Day scheduled for June 12, 2025, to share long-term roadmap and targets.

• Fixed expenses expected to remain consistent as revenue grows, leveraging scalable infrastructure.

• Focus on premium retention, pricing, and underwriting actions to mitigate loss volatility.