SelectQuote (SLQT) Q2 2025 earnings summary

Executive summary

• Achieved 19% year-over-year revenue growth to $481.1M in Q2 FY25, with net income rising to $53.2M and Adjusted EBITDA up 30% to $87.5M, driven by strong performance in Senior and Healthcare Services segments.

• Raised FY25 guidance for revenue ($1.5B–$1.575B), Adjusted EBITDA ($115M–$140M), and net income (loss) ($(24)M–$11M), reflecting robust operational results.

• Completed a $350M preferred equity investment led by Bain Capital and Morgan Stanley Private Credit, enhancing liquidity and supporting growth.

• Executed a $100M securitization, repaid over $123M in term loans, and reduced annual cash interest by $30M, improving capital structure and flexibility.

• CEO highlighted strong agent productivity, policy volume growth, and resilience during a disruptive Medicare Advantage enrollment season.

Financial highlights

• Q2 FY25 revenue was $481.1M (+19% YoY); net income $53.2M (11% margin); Adjusted EBITDA $87.5M (18% margin, +30% YoY).

• Senior segment revenue reached $255.6M, Adjusted EBITDA $100.5M (39% margin, +28% YoY).

• Healthcare Services revenue was $183.4M (+64% YoY), with SelectRx membership up 54% to nearly 97,000.

• Life segment revenue was $39.9M (+7% YoY), Adjusted EBITDA $7.4M (19% margin, +62% YoY).

• Gross and operating margins improved to 15% for the quarter, up from 14% YoY.

Outlook and guidance

• FY25 revenue guidance raised to $1.5B–$1.575B; Adjusted EBITDA to $115M–$140M; net income (loss) to $(24)M–$11M.

• SelectRx membership growth expected to moderate in H2 due to Q2 pull-forward.

• Senior segment margins expected in low to mid-20s for H2; Healthcare Services margins in low single digits.

• Management expects compliance with debt covenants over the next 12 months.

• Additional financing may be sought to meet future milestone payments.