Exzeo Group Reports Q2 2026 Results: Full Earnings Call Transcript

Exzeo Group (NYSE: XZO ) reported second-quarter financial results on Thursday. The transcript from the company's second-quarter earnings call has been provided below. APIs provide real-time access to earnings call transcripts and financial data. Visit to learn more.

View the webcast at Summary Exzeo Group Inc. 4 billion and an adjusted EBITDA margin of 53%. The company remains debt-free, ending the quarter with $333 million in invested assets, and increased shareholders' equity to $288 million. 4 billion.

Strategic initiatives include a partnership with GEICO to expand the platform's insurance offerings and the launch of Exzeo Ventures to explore AI-driven business opportunities. Operational highlights include doubling agent numbers and quote volumes, and significant interest from independent agents and insurers joining the platform. Management expressed confidence in the company's long-term growth, emphasizing a debt-free balance sheet, high margins, and innovations in AI through Exzeo Ventures. Full Transcript OPERATOR Thank you for joining us and welcome to the Exzeo Group Inc.

Second Quarter 2026 Earnings Conference Call. After today's prepared remarks, we will host a question and answer session. If you'd like to ask a question, please press Star one to raise your hand. To withdraw your question, press Star one again.

I would now like to hand the conference over to Bill Brumal, VP of Investor Relations. Bill, please proceed. Bill Brumal, VP of Investor Relations Thank you and good afternoon. Welcome to Exzeo Group's second quarter 2026 earnings call.

To access today's webcast, please visit the Investor Information section of our corporate website at Before we begin, I would like to take the opportunity to remind our listeners that today's presentation and responses to questions may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as anticipate, estimate, expect, intend, plan and project and other similar words and expressions are intended to signify forward-looking statements. Forward-looking statements are not guarantees of future results and conditions, but rather are subject to various risks and uncertainties.

Some of these risks and uncertainties are identified in the company's filings with the Securities and Exchange Commission. Should any risks and uncertainties develop in actual events, these developments could have a material adverse effect on the Company's business, financial condition and results of operation. Exzeo Group disclaims all the obligations to update any forward-looking statements. Now with that, I would like to turn the call over to Suela Bulku, Exzeo's Chief Financial Officer.

Suela Sefa Bulku, AIAF — Chief Financial Officer Thank you, Bill. Good evening everyone and thank you for joining us for Exzeo's second quarter earnings call. Exzeo continues down the path of strong execution and attractive financial results. 4 billion and we delivered another quarter of attractive margins including a 53% adjusted EBITDA margin in the quarter.

Pre-tax income for the quarter was over $31 million, an increase from over $28 million in the prior quarter. These results were above the guidance we provided. 48. For the second quarter, total revenue increased to $58 million, up from $56 million in the prior year quarter driven by the increase of managed premium on the platform.

Excluding outsourcing claim fees, adjusted revenue increased by $4 million year over year to more than $56 million. 2 billion in the prior quarter. Given the seasonality of growth for our clients, managed premiums were in line with expectations. Our adjusted EBITDA margin was over 53% in the quarter and we believe annualized margins above 50% are achievable for the foreseeable future.

A few additional highlights for the quarter: Our annual recurring revenue was $211 million in the second quarter, an increase from $195 million in the prior quarter. Our balance sheet remains exceptionally strong. We ended the quarter with over $333 million of invested assets, which includes cash, cash equivalents and fixed income securities. We remain debt-free and continue to maintain significant financial flexibility.

Shareholders’ equity increased to $288 million, an increase from $254 million at the end of the year. Next, I want to quickly touch on our guidance expectations for the third quarter. 4 billion. Our guidance for the third quarter is consistent with the anticipated timing of growth across our existing client base.

Our full year guidance remains unchanged. Before turning the call over to Kevin, I wanted to quickly touch on recent capital management actions. During the quarter we repurchased over 726,000 shares of our common stock for approximately $10 million. Subsequent to the quarter we already purchased an additional 107,000 shares, which brings dollar repurchases to $12 million, completing the authorized share repurchase program.

We continue to have tremendous confidence in the long-term outlook for our business. Given our asset-light model, high margins, debt-free balance sheet, significant cash on hand and the momentum we are seeing across the business, we believe allocating less than a quarter’s worth of earnings to repurchase shares at attractive valuations was a compelling use of capital. And with that I will hand it over to Kevin, President of Exzeo. Kevin Soila, President Thank you, Suela.

The Exzeo platform continues to gain momentum and we are seeing encouraging customer wins. Let me elaborate on some of these achievements. While we often talk about the insurance companies joining our platform, demand extends well beyond carriers. We are seeing growing interest from independent agents who are proactively reaching out to join the Exzeo platform.

The flywheel effect we've discussed in the past is real. As more agents join the platform, it becomes increasingly attractive to insurance companies. As more carriers come on board, the value proposition for agents continues to strengthen. That network effect is helping accelerate adoption across our ecosystem.

Second, we've seen quote volume more than double since the beginning of the year. Third, last month we signed our eighth carrier partner. Our new partnership with GEICO brings auto insurance to the platform, marking another meaningful step in expanding our capabilities. Agents can now bundle home and auto.

With the addition of auto, the Exzeo platform now offers homeowners, commercial, residential, flood and auto insurance. Expanding our product set makes the platform more valuable to agents by enabling them to serve more of their clients' insurance needs through a single platform. In closing, since the beginning of the year we've made meaningful progress across every dimension of the platform. We've doubled the number of agents, we've more than doubled quote volume and we've added additional products and we've grown to eight carriers on the platform.

Now I'll turn the call over to Paresh, Exzeo's Chief Executive Officer. Thanks. Paresh Patel, Chairman & CEO Kevin and Suela provided numbers that clearly show how healthy and cash flow positive Exzeo already is. Kevin highlighted the tremendous momentum in size and scope of the Exzeo platform.

The continued addition of new carriers, new products and new capabilities reinforces that our platform is gaining meaningful traction in the marketplace. And while these initiatives don't translate results overnight, they continue to strengthen our long-term growth opportunity and expand the value we can deliver. Beyond all of this, earlier today we announced the next new initiative, Exzeo Ventures. The reason we're launching Exzeo Ventures is simple.

AI represents a once-in-a-generation paradigm shift. And most companies think about AI as a tool to make existing processes faster or more efficient. And while that's certainly valuable, we think there is a much bigger opportunity. And a useful analogy might be to look back at the Internet.

The evolution of the Internet: the first wave of the Internet brought traditional businesses online, making familiar processes faster and more efficient. But the truly transformative companies were the companies that created entirely new business models that only became possible because of the Internet. For example, companies like Uber fundamentally reimagined transportation. And we believe AI has the potential to follow a very similar path.

So rather than simply asking how AI can make current businesses more efficient, we are asking a much bigger question: what entirely new products, services and businesses can AI make possible? And that's the purpose of Exzeo Ventures. Now, we've been working on these ideas behind the scenes for some time and we've reached a point where we've seen enough progress and assembled the right team that we're ready to formalize the effort. We're funding Exzeo Ventures as an internal platform and its mission is to identify opportunities that only emerge when AI fundamentally changes what's possible.

And let me give you one small example amongst a number of initiatives that we are working on. After a major catastrophe event, insurance carriers experience an enormous surge in claims. The challenge isn't simply receiving those claims. It's having the personnel available to process them.

That staffing bottleneck often delays claim handling at exactly the time when policyholders need assistance the most. Simply put, scaling up the human element in a demand surge is challenging. It is difficult to increase human compute at the touch of a dial. However, with AI, you can increase the compute by orders of magnitude immediately.

So imagine a carrier that normally processes 200 claims per week suddenly needing to process 4,000 because of major catastrophe events. The claim volume has spiked 20-fold. But now with AI capabilities, processing capacity can increase just as quickly. The result will be faster claims handling, shorter wait times, and a significantly better experience for the policyholders during some of the most difficult times they'll ever face.

And this is exactly the type of opportunity that excites us because it simply wasn't possible before AI. And that's the vision behind Exzeo Ventures. Across underwriting, claims distribution, claims risk transfer, and many other areas, we believe AI creates the opportunity for entirely new categories of products and businesses. And with that, I will turn over the call for questions.

OPERATOR We will now begin the question and answer session. If you would like to ask a question, please press Star one now to raise your hand and join the queue. To withdraw your question, press Star one again. We ask that you do pick up your handset when asking a question to allow for optimum sound quality.

And if you are muted locally, please remember to unmute your device. Please stand by now while we compile the Q and A roster. Your first question comes from the line of Terry Tillman with Truist. Your line is open.

Please go ahead. Terry Tillman, Analyst at Truist Yeah, good afternoon, Paresh, Kevin, and Bill. I have three questions, but it'll be really quick, I promise. First, on GEICO, I think they're relatively large.

S. I mean, is there any way to kind of ring-fence this or give us a sense on how sizable this could be and kind of timing and when this could start to hit the model? And then I had two follow-ups. Paresh Patel, Chairman & CEO Yes, Terry, GEICO is big.

It's huge, right? And there's also been a recent thing about people wanting to bundle home and auto and the benefits of all of that. But the issue becomes the benefit: do you bundle with the auto carrier bundling the home or the home carrier bundling the auto, or do you let the agent on the platform assemble the bundle? These are all choices that would result in the same outcome.

The partnership with GEICO lets people bundle and sell GEICO on the Exzeo platform. So it's a big start. We'll see how it grows into it. But yes, it could be something big.

Early days yet. But we are very excited to partner with GEICO. Terry Tillman, Analyst at Truist Understood. I appreciate that.

And maybe the second question, and I'm assuming some of those might want to also double click on this. Exzeo Ventures sounds very interesting, but could you help us a little bit with, you know, another one of these? What would it do? Would it be it drives more carriers or business relationships or it drives more of a take rate with your existing carriers?

Is it a managed premium dynamic? And at the same time by making these investments, would you still be, you know, kind of achieving those really high 50% plus EBITDA margins? Paresh Patel, Chairman & CEO So I would characterize it this way. What you sort of said about AI helping the Exzeo platform, that's all going to occur anyway.

That isn't what Exzeo Ventures is about. There will be AI on the Exzeo platform side as well. And that's what everybody else is also looking at, modernizing your current stack because of AI. What we're talking about with Exzeo Ventures is doing something that could not be possible without AI.

And that's what we're talking about: businesses. Think of, again in my earlier comments, the example of Uber. Uber is not possible without the Internet and GPS and maps and everything else, right. But it isn't just taking a taxi company and putting it on a web presence.

It's reimagining how things get done, how transportation is done. And we are starting to see there are things that you can now do with AI that you just couldn't do without AI. And one simple example of this that we kind of piloted a little bit was this win from Pro we talked about last quarter. It allowed carriers to process this new requirement that came in and it would have required a lot of staffing and training and all that kind of stuff.

But using AI, we turned it into something that we could share with the whole industry very, very easily. It's stuff like that that we're talking about. It's not retrofitting AI to existing businesses, it's trying to think of new businesses we can do that's only possible because of AI. And we have a few, we have like four or five in the hopper at the moment.

We will obviously discuss them as they all come to more maturity as we go along. So we're in the process of seeding and setting all that up. But Exzeo Ventures is not just an incremental thing. It could be something very, very different that is even beyond insurance, if that helps.

Terry Tillman, Analyst at Truist Yeah, it does help. I'm looking forward to hearing more. Just the final one and I'll jump off here. Anything you can share though, Suela, in terms of 3Q and 4Q in terms of how to think about adjusted revenue maybe versus, you know, where we ended at $56 million in 2Q.

And then can you remind us again what the managed premium target was for the end of the year? And I think you said that's unchanged. Suela Sefa Bulku, AIAF — Chief Financial Officer Yes. 55 billion for managed premium.

And in terms of Q3 and Q4, the one thing I would say is just a reminder that the ARR and how it converts to revenue, there is an analogy that we have in our business and that depends on the renewal cycle and the product mix. So for 2026 we have revenue that peaks slightly in Q2 and it's more modest in Q3, more natural in Q3, and then a slight Q4 step down. So just that's very typical for our seasonality. Terry Tillman, Analyst at Truist That's great.

Very helpful, thanks. OPERATOR And again, if you have dialed in and would like to ask a question, please press Star one on your telephone keypad to join the queue. Now please stand by while we compile the Q and A roster. At this time, there are no further questions.

I would now like to turn the call back over to Paresh Patel, who has a few closing remarks. Actually, we've just had someone raise their hand. The next question comes from Dylan Becker with William Blair. Your line is open.

Please go ahead. Dylan Becker, Analyst at William Blair Hey guys. Hey guys. Sorry about that.

Yeah, got thwarted by the Star one, unfortunately, but we made it. Hey, question on Kevin. You kind of touched on the agent flywheel, carrier flywheel dynamic and obviously GEICO seems to be a big unlock in that context as well. But wondering if you could kind of expand on that notion as you broaden kind of the scope across carriers, premium as well as potential kind of lines, how that kind of drives the follower notion of more agents and obviously underwriting more premium through the Exzeo platform as it seems kind of fortuitous in and of itself and starting to gain some real traction and momentum here.

Kevin Soila, President Yeah, thanks, Dylan. It's Kevin. Yeah, we're seeing some interesting trends definitely this year. What we're finding is agents are looking at being proactive with their clients.

A lot of that is utilizing technology. So one of the things that's really having them gravitate to the Exzeo platform is just the ease of use.