SelectQuote (SLQT) Q4 2024 earnings summary

Executive summary

• FY2024 revenue reached $1,321.8M, up 32% year-over-year, exceeding guidance midpoint, with strong performance in Senior Medicare Advantage and Healthcare Services, especially SelectRx, driving high margins and cash efficiency.

• Adjusted EBITDA for FY2024 was $117.0M, a 57% increase from $74.3M in FY2023, outperforming original guidance by 26%.

• Senior division delivered a 25% full-year Adjusted EBITDA margin, surpassing the 20%+ target, with high agent productivity and stable LTVs.

• Healthcare Services achieved positive Adjusted EBITDA for the fifth consecutive quarter, with SelectRx membership up 68% to over 82,000.

• Operating and free cash flow were positive for FY2024, with a strategic focus on unit profitability, cash flow, and deleveraging the balance sheet.

Financial highlights

• Q4 FY24 revenue grew 39% year-over-year to $307.2M, with full-year consolidated revenue up 32% to $1.3B.

• Q4 FY24 Adjusted EBITDA was $14.4M, compared to $(5.8)M in Q4 FY23; full-year Adjusted EBITDA was $117.0M, up 57% year-over-year.

• Senior segment revenue grew to $656M in FY2024 from $590M in FY2023; Life segment revenue grew 8% to $158M.

• Auto & Home contributed $36M in revenue, with a one-time $10.4M revenue adjustment and business being rationalized.

• Cash and cash equivalents at June 30, 2024, were $42.7M, down from $83.2M a year earlier.

Outlook and guidance

• FY2025 revenue expected at $1.4–$1.5B (10% growth at midpoint); Adjusted EBITDA projected at $90–$120M, a 10% decline at midpoint due to lower Senior MA production.

• Net loss forecasted between $42M and $6M.

• Senior MA policy count expected to decline 10–15% due to capital constraints and commission structure changes, but unit economics and 20%+ margin targets remain intact.

• Healthcare Services membership projected to grow 20–25%, with revenue up 35–45% and EBITDA margins expected in low- to mid-single digits, improving through the year.

• Healthcare Services expected to offset some Senior volume headwinds with continued growth and profitability.