Hippo (HIPO) Q2 2025 earnings summary

Executive summary

• Achieved first positive net income from operating activities, with net income of $1.3 million for Q2 2025, reflecting strong execution of a long-term strategic plan focused on diversification, market growth, and risk management.

• Announced a transformative partnership with The Baldwin Group, including a $100 million capital infusion, accelerating premium growth and expanding distribution through Westwood Insurance Agency.

• Launched two new commercial and casualty programs on the hybrid fronting platform, further diversifying and expanding profitability.

• Adjusted net income reached $17 million, a significant improvement from a $19.5 million loss in Q2 2024, driven by improved underwriting and expense management.

• Total revenue rose 31% year-over-year to $117 million, reflecting growth in Insurance-as-a-Service and Hippo Home Insurance Program segments.

Financial highlights

• Gross written premium increased 16% year-over-year to $299 million, driven by organic growth and new programs.

• Net income reached $1.3 million, a $41.8 million improvement year-over-year; adjusted net income was $17 million, up $37 million.

• Consolidated net loss ratio improved 46 percentage points year-over-year to 47%; excluding reserve releases, net loss ratio was 55%.

• Operating expenses declined 16% year-over-year, falling from 46% to 30% of revenue; fixed expenses declined by $6 million year-over-year.

• Cash and investments increased by $76 million to $604 million, aided by a $50 million surplus note issuance.

Outlook and guidance

• Raised full-year 2025 gross written premium guidance to $1.07–$1.1 billion, reflecting strong new program performance.

• Updated full-year revenue guidance to $460–$465 million, accounting for the sale of home builder distribution assets.

• Improved full-year consolidated net loss ratio guidance to 67–69% from 72–74%.

• Raised net income guidance for 2025 to $35–$39 million (from a prior loss), and adjusted net income guidance to between $4 million loss and break even.

• 2028 targets include gross written premium over $2 billion, adjusted net income over $125 million, and adjusted ROE over 18%.