ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and related notes appearing in Part II, Item 8 of this Annual Report on Form 10-K. Some of the information contained in this discussion and analysis or set forth elsewhere in this Annual Report on Form 10-K, including information with respect to our plans and strategy for our business, includes forward-looking statements that involve risks and uncertainties. As a result of many factors, including those factors set forth in the ‘‘Risk Factors’’ section of this Annual Report on Form 10-K, our actual results could differ materially from the results described in, or implied by, the forward-looking statements contained in the following discussion and analysis.
Overview
We operate a leading online marketplace for insurance shopping, connecting consumers with insurance provider customers, which includes both carriers and agents. Our vision is to be the leading growth partner for P&C insurance providers. Our results-driven marketplace, powered by our proprietary data and technology platform, is improving the way insurance providers attract and connect with consumers shopping for insurance.
We operate a marketplace to connect insurance providers to a large volume of high-intent, pre-validated consumer referrals that match the insurers’ specific underwriting and profitability requirements. The transparency of our marketplace, as well as the campaign management tools we offer, are designed to make it easy for insurance carriers and third-party agents to evaluate the performance of their marketing spend on our platform and manage their own return on investment. We present consumers with a single starting point for a comprehensive insurance shopping experience where consumers can engage with insurance carriers through multiple channels based on their preferences. Our marketplace enables consumers to choose to visit an insurance provider’s website to purchase a policy or engage with a carrier or agent by phone or submit their data to insurance providers to receive quotes. Our services are free for consumers, and we derive our revenue principally from consumer inquiries sold as referrals to insurance providers.
In the years ended December 31, 2025, 2024 and 2023, our total revenue was $692.5 million, $500.2 million and $287.9 million, respectively, representing year-over-year increases of 38.5% from 2024 to 2025 and 73.7% from 2023 to 2024. We had net income of $99.3 million and $32.2 million for the years ended December 31, 2025 and 2024, respectively, and a net loss of $51.3 million for the year ended December 31, 2023, and had $94.6 million, $58.2 million and $0.5 million in adjusted EBITDA for these same periods, respectively. See the section titled “—Non-GAAP Financial Measure” for information regarding our use of adjusted EBITDA and its reconciliation to net income (loss) determined in accordance with generally accepted accounting principles in the United States, or GAAP.
Factors Affecting Our Performance
We believe that our performance and future growth depend on a number of factors that present significant opportunities for us but also pose risks and challenges, including those discussed below and in the section titled “Risk Factors.”
Auto insurance industry risk
For the years ended December 31, 2025 and 2024, we derived 91% and 89%, respectively, of our revenue from auto insurance providers and our financial results depend on the performance of the auto insurance industry. Furthermore, total revenue from our two largest customers accounted for 38% and 11%, respectively, of our total revenue for the year ended December 31, 2025 and revenue from our largest auto insurance carrier customer was 39% of our revenue for the year ended December 31, 2024. Business cycles within the auto insurance industry heavily impact our carrier customers’ advertising spend with us, such as the downturn we saw in 2022 and 2023, when the auto insurance industry experienced deteriorated underwriting performance due to a rise in claims, inflation, and inadequate policy premiums, which had a negative impact on the pricing and demand for consumer referrals in our marketplace throughout 2023. The state of the auto insurance market remains volatile, and while spending patterns have significantly improved since 2023, a number of our top carrier customers remain below their peak historical spend.
Expanding consumer traffic
Our success depends in part on the growth of our consumer traffic. We have historically increased consumer traffic to our marketplace by expanding existing advertising channels and adding new channels such as by engaging with consumers through our verified partner network. Over the long term, we plan to increase consumer traffic by leveraging the features and growing the data assets of our platform. While we plan to grow consumer traffic, we have the ability to decrease advertising spend when the revenue associated with such consumer traffic does not result in incremental profit to our business or in response to lower demand for consumer referrals. Further, our profitability will be impacted by our ability to acquire quote requests in significant volume, at prices that are attractive, and that represent high-intent shoppers for which insurance providers will purchase referrals.
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Increasing the number of insurance providers and their respective spend in our marketplace
Our success also depends on our ability to retain and grow our insurance provider network. Historically, we have generally expanded both the number of insurance providers and the spend per provider on our platform. However, we have also experienced periods of decreasing carrier spend in the automotive insurance vertical as described above.
Regulation
Our revenue and earnings may fluctuate from time to time as a result of changes to federal, state, and industry-based laws and regulations, or changes to standards concerning the enforcement thereof. Our business could be affected directly because we operate websites, conduct telephonic and email marketing, and collect, store, share, and use consumer information and other data. Our business also could be affected indirectly if our customers were to adjust their operations as a result of regulatory changes and enforcement activity. For example, on January 26, 2024, the FCC published regulations which, among other things, would have amended the consent requirements of the TCPA by requiring “one-to-one consent” for outbound telemarketing calls or texts made using an automatic telephone dialing system or pre-recorded or artificial voice messages to wireless or residential numbers. On January 24, 2025, the United States Court of Appeals for the Eleventh Circuit vacated these amended regulations, which were scheduled to go into effect on January 27, 2025. Also, on June 20, 2025, the Supreme Court of the United States held that the Hobbs Act does not bind district courts in civil enforcement proceedings to an agency’s interpretation of a statute, including the FCC’s interpretation of the TCPA. It remains unclear whether or how government agencies or legislatures will revisit telephone call consent issues.
In addition, a number of states have enacted (and others are considering) broad data privacy laws that could affect our business. Although it remains unclear how these new privacy laws may be modified or interpreted, their effects could have an impact on our business, and may require us to modify our data use practices and policies and incur compliance-related costs and expenses.
Key Business Metrics
We regularly review a number of metrics, including GAAP operating results and the key metrics listed below, to evaluate our business, measure our performance, identify trends affecting our business, formulate financial projections, and make operating and strategic decisions. Some of these metrics are non-financial metrics or are financial metrics that are not defined by GAAP.
Adjusted EBITDA
We define Adjusted EBITDA as net income (loss), adjusted to exclude: stock-based compensation expense, depreciation and amortization expense, legal settlement expense, restructuring and other charges, acquisition-related costs, interest income and income taxes. Adjusted EBITDA is a non-GAAP financial measure that we present in this Annual Report on Form 10-K to supplement the financial information we present on a GAAP basis. We monitor and present Adjusted EBITDA because it is a key measure used by our management and board of directors to understand and evaluate our operating performance, to establish budgets and to develop operational goals for managing our business. Adjusted EBITDA should not be considered in isolation from, or as an alternative to, measures prepared in accordance with GAAP. Adjusted EBITDA should be considered together with other operating and financial performance measures presented in accordance with GAAP. Also, Adjusted EBITDA may not necessarily be comparable to similarly titled measures presented by other companies. For further explanation of the uses and limitations of this measure and a reconciliation of Adjusted EBITDA to the most directly comparable GAAP measure, net income (loss), please see “—Non-GAAP Financial Measure.”
Variable Marketing Dollars and Margin
We define variable marketing dollars, or VMD, as revenue, as reported in our consolidated statements of operations and comprehensive income (loss), less advertising costs (a component of sales and marketing expense, as reported in our consolidated statements of operations and comprehensive income (loss)). We define variable marketing margin, or VMM, as VMD divided by revenue.
We use VMD and VMM to measure the efficiency of individual advertising and consumer acquisition sources and to make trade-off decisions to manage our return on advertising. We do not use VMD or VMM as a measure of profitability.
Key Components of Our Results of Operations
Revenue
We generate our revenue primarily from consumer inquiries sold as referrals to insurance provider customers, consisting of carriers and agents, as well as to indirect distributors. To simplify the quoting process for the consumer and improve performance for the provider, we are able to provide consumer-submitted quote request data along with each referral. We recognize revenue from consumer referrals at the time of delivery. We support three secure consumer referral formats:
Clicks: An online-to-online referral, with a handoff of the consumer to the provider’s website.
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Data: An online-to-offline referral, with quote request data transmitted to the provider for follow-up.
Calls: An online-to-offline referral for outbound calls and an offline-to-offline referral for inbound calls, with the consumer and provider connected by phone.
Prior to the sale of carrier contracts in May 2025, we also generated revenue in the automotive insurance vertical from commission fees for the sale of policies as part of our direct to consumer agency and, prior to our exit from the health insurance vertical in 2023, we generated commission revenue in our other insurance vertical. Commission revenue represented less than 1% of total revenue for each of the years ended December 31, 2025 and 2024, and less than 10% of revenue for the year ended December 31, 2023.
For the periods presented, our total revenue consisted of revenue generated within our insurance verticals as follows:
Year Ended December 31,
(in thousands)
Automotive
Home and renters
Other
Total revenue
We expect an overall increase in revenue in 2026 as compared to 2025, driven by our automotive and home and renters verticals, as we anticipate increased spending from our carrier partners. We expect revenue from our other insurance verticals to be insignificant in 2026 as a result of our focus on the P&C market.
Cost and Operating Expenses
Our cost and operating expenses consist of cost of revenue, sales and marketing, research and development, general and administrative, legal settlement, restructuring and other charges and acquisition-related costs.
We allocate certain overhead expenses, such as rent, utilities, office supplies and depreciation and amortization of general office assets, to cost of revenue and operating expense categories based on headcount. As a result, an overhead expense allocation is reflected in cost of revenue, sales and marketing, research and development and general and administrative expenses. Personnel-related costs included in cost of revenue and operating expense categories include wages, fringe benefit costs and stock-based compensation expense.
Cost of Revenue
Cost of revenue is comprised primarily of the costs of operating our marketplace and delivering consumer referrals to our customers. These costs consist primarily of technology service costs including hosting, software, data services, and third-party call center costs. In addition, cost of revenue includes depreciation and amortization of our platform technology assets and personnel-related costs.
Sales and Marketing
Sales and marketing expense consists primarily of advertising and marketing expenditures as well as personnel-related costs for employees engaged in sales, marketing, data analytics and consumer acquisition functions and amortization of sales and marketing-related intangible assets. Advertising expenditures consist of variable costs that are related to attracting consumers to our marketplace, generating consumer quote requests, including the cost of quote requests we acquire from our verified partner network, and promoting our marketplace to carriers and agents. Advertising costs are expensed as incurred. Marketing costs consist primarily of content and creative development, public relations, memberships, and event costs. We expect our sales and marketing expense will increase as we expect increased carrier spend for referrals, which will impact our advertising expenditures.
Research and Development
Research and development expense consists primarily of personnel-related costs for software development and product management. We have focused our research and development efforts on improving ease of use and functionality of our existing marketplace platform and developing new offerings and internal tools. We primarily expense research and development costs. Direct development costs related to software enhancements that add functionality are capitalized and amortized as a component of cost of revenue. We expect that research and development expense will increase in 2026 as compared to 2025.
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General and Administrative
General and administrative expense consists of personnel-related costs and related expenses for executive, finance, legal, human resources, technical support and administrative personnel as well as the costs associated with professional fees for external legal, accounting and other consulting services, insurance premiums and payment processing and billing costs. We expect that general and administrative expense will increase in 2026 as compared to 2025, primarily due to personnel-related costs.
Legal settlement
Legal settlement includes costs associated with the settlement of our litigation in 2025 with the former owners of certain entities acquired in 2021 (see Note 3 to the Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K).
Restructuring and Other Charges
Restructuring and other charges includes costs related to the restructuring and our exit from the health insurance vertical that we completed in 2023.
Acquisition-related
Acquisition-related costs include expenses associated with third-party professional services we utilize for the evaluation and execution of acquisitions as well as changes in the fair value of our contingent consideration liabilities recorded as the result of our acquisitions of Eversurance and PolicyFuel, which occurred in 2020 and 2021, respectively.
Other Income (Expense)
Other income (expense) consists of interest income and other income (expense). Interest income consists of interest earned on invested cash balances. Other income (expense) consists of miscellaneous income (expense) unrelated to our core operations.
Income Taxes
Income tax benefit (expense) is based on taxable income (loss), applicable income tax rates, net research and development tax credits, net operating loss carryforwards, changes in valuation allowance estimates and deferred income taxes. In the fourth quarter of 2025, based on our ongoing assessment of all available evidence, both positive and negative, including sustained improvement in our profitability, we concluded that it is more likely than not that our net deferred tax assets would be realized and released our valuation allowance of $48.5 million against these net deferred tax assets. Our judgment regarding the likelihood of realization of these deferred tax assets could change in future periods, which could result in a material impact to our income tax benefit (expense) in the period of change.
As a result of the release of our valuation allowance, we expect our tax rate will increase in the future. However, we intend to use our net operating loss carryforwards and tax credits, to the extent available, to reduce the cash tax payments associated with our operations.
Non-GAAP Financial Measure
To supplement our consolidated financial statements presented in accordance with GAAP and to provide investors with additional information regarding our financial results, we present in this Annual Report on Form 10-K adjusted EBITDA as a non-GAAP financial measure. Adjusted EBITDA is not based on any standardized methodology prescribed by GAAP and is not necessarily comparable to similarly titled measures presented by other companies.
Adjusted EBITDA . We define adjusted EBITDA as our net income (loss), excluding the impact of stock-based compensation expense; depreciation and amortization expense; legal settlement expense; restructuring and other charges; acquisition-related costs; interest income; and income taxes. The most directly comparable GAAP measure to adjusted EBITDA is net income (loss). We monitor and present in this Annual Report on Form 10-K adjusted EBITDA because it is a key measure used by our management and board of directors to understand and evaluate our operating performance, to establish budgets and to develop operational goals for managing our business. In particular, we believe that excluding the impact of these expenses in calculating adjusted EBITDA can provide a useful measure for period-to-period comparisons of our core operating performance.
We use adjusted EBITDA to evaluate our operating performance and trends and make planning decisions. We believe adjusted EBITDA helps identify underlying trends in our business that could otherwise be masked by the effect of the expenses that we exclude in the calculation of adjusted EBITDA. Accordingly, we believe that adjusted EBITDA provides useful information to investors and others in understanding and evaluating our operating results, enhancing the overall understanding of our past performance and future prospects.
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Adjusted EBITDA is not prepared in accordance with GAAP and should not be considered in isolation of, or as an alternative to, measures prepared in accordance with GAAP. There are a number of limitations related to the use of adjusted EBITDA rather than net income (loss), which is the most directly comparable financial measure calculated and presented in accordance with GAAP. Some of these limitations are:
adjusted EBITDA excludes stock-based compensation expense as it has recently been, and will continue to be for the foreseeable future, a significant recurring non-cash expense for our business;
adjusted EBITDA excludes depreciation and amortization expense and, although this is a non-cash expense, the assets being depreciated and amortized may have to be replaced in the future;
adjusted EBITDA excludes legal settlement expense that affects cash available to us;
adjusted EBITDA excludes restructuring and other charges, which includes the sale of health assets, that affects cash available to us;
adjusted EBITDA excludes acquisition-related costs that affects cash available to us and the change in fair value of non-cash contingent consideration liabilities;
adjusted EBITDA does not reflect the cash received from interest income on our investments, which affects the cash available to us;
adjusted EBITDA does not reflect income taxes that affects cash available to us; and
the expenses and other items that we exclude in our calculation of adjusted EBITDA may differ from the expenses and other items, if any, that other companies may exclude from adjusted EBITDA when they report their operating results.
In addition, other companies may use other measures to evaluate their performance, all of which could reduce the usefulness of adjusted EBITDA as a tool for comparison.
The following table reconciles adjusted EBITDA to net income (loss), the most directly comparable financial measures calculated and presented in accordance with GAAP.
Reconciliation of Net Income (Loss) to Adjusted EBITDA:
Year Ended December 31,
(in thousands)
Net income (loss)
Stock-based compensation
Depreciation and amortization
Legal settlement
Restructuring and other charges
Acquisition-related costs
Interest income
Income taxes
Adjusted EBITDA
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Results of Operations
The following tables set forth our results of operations for the periods shown:
Year Ended December 31,
(in thousands)
Statement of Operations Data:
Revenue(1)
Cost and operating expenses(2):
Cost of revenue
Sales and marketing
Research and development
General and administrative
Legal settlement
Restructuring and other charges
Acquisition-related costs
Total cost and operating expenses
Income (loss) from operations
Other income (expense):
Interest income
Other income (expense), net
Total other income, net
Income (loss) before income taxes
Income tax benefit (expense)
Net income (loss)
Other Financial and Operational Data:
Variable marketing dollars
Adjusted EBITDA(3)
Comprised of revenue from the following distribution channels:
Year Ended December 31,
Direct channels
Indirect channels
Includes stock-based compensation expense as follows:
Year Ended December 31,
(in thousands)
Cost of revenue
Sales and marketing
Research and development
General and administrative
Restructuring and other charges
(3) See “—Non-GAAP Financial Measure” for information regarding our use of adjusted EBITDA as a non-GAAP financial measure and a reconciliation of adjusted EBITDA to its comparable GAAP financial measure.
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Comparison of the Years Ended December 31, 2025 and 2024
Revenue
Year Ended December 31,
Change
Amount
(dollars in thousands)
Revenue
Revenue increased by $192.3 million from $500.2 million for the year ended December 31, 2024 to $692.5 million for the year ended December 31, 2025. The increase in revenue was primarily due to an increase of $183.7 million in our automotive vertical due to an increase in carrier spend for referrals, primarily from our three largest customers. Revenue also increased in our home and renters vertical by $10.6 million due to an increase in carrier spend for referrals.
Cost of Revenue
Year Ended December 31,
Change
Amount
(dollars in thousands)
Cost of revenue
Percentage of revenue
Cost of revenue decreased from $20.9 million for the year ended December 31, 2024 to $19.4 million for the year ended December 31, 2025. Decreases in personnel-related costs of $0.8 million related primarily to decreased headcount in our call center. Amortization expense decreased by $0.7 million primarily due to certain assets being fully depreciated in the third quarter of 2024. Increases in technology and consulting costs were fully offset by decreases in lead verification services and office and occupancy costs due to lower headcount and lower rent expense.
Sales and Marketing
Year Ended December 31,
Change
Amount
(dollars in thousands)
Sales and marketing expense
Percentage of revenue
Sales and marketing expenses increased by $153.3 million from $387.7 million for the year ended December 31, 2024 to $541.0 million for the year ended December 31, 2025. The increase in sales and marketing expense was primarily due to an increase in advertising costs of $155.7 million due to an increase in carrier spend and increases in lead verification services and consulting services of $0.8 million and $0.7 million, respectively. These increases were partially offset by a decrease in office and occupancy costs of $1.4 million due primarily to lower rent expense and a decrease in amortization expense of $1.2 million due to the sale of acquired intangible assets in May 2025 as part of the settlement of litigation. Marketing costs also decreased by $0.5 million.
Research and Development
Year Ended December 31,
Change
Amount
(dollars in thousands)
Research and development expense
Percentage of revenue
Research and development expenses increased by $2.0 million from $29.6 million for the year ended December 31, 2024 to $31.5 million for the year ended December 31, 2025. The increase in research and development expense was primarily due to an increase in personnel-related costs of $1.2 million due to increased headcount and increased consulting expense of $0.5 million.
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General and Administrative
Year Ended December 31,
Change
Amount
(dollars in thousands)
General and administrative expense
Percentage of revenue
General and administrative expenses increased by $3.8 million from $30.3 million for the year ended December 31, 2024 to $34.1 million for the year ended December 31, 2025. The increase in general and administrative expenses was primarily due to an increase in personnel-related costs of $2.3 million, primarily due to increased stock-based compensation expense, and an increase in professional fees of $0.9 million for consulting services. Personnel-related costs included $10.7 million and $8.1 million of stock-based compensation expense for the years ended December 31, 2025 and 2024, respectively. Bank service fees also increased by $0.6 million.
Legal Settlement
Legal settlement expense for the year ended December 31, 2025 consisted of costs to settle the litigation of $7.8 million and legal expense related to the settlement of $0.4 million. For additional information, see Note 3 to the Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K.
Other Income (Expense)
Other income (expense) included interest income of $3.6 million and $2.1 million for the years ended December 31, 2025 and 2024, respectively. The increase in interest income in 2025 was due to higher invested cash balances. Other income (expense), net was not significant for either of the years ended December 31, 2025 or 2024.
Income Taxes
We had an income tax benefit of $37.5 million for 2025, as compared to income tax expense of $1.8 million in 2024. Our effective tax rate was (60.6%) and 5.4% for 2025 and 2024, respectively. Our effective tax rate for 2025 differs from the U.S. federal statutory income tax rate of 21.0% primarily due to the decrease in the valuation allowance maintained against our net deferred tax assets and federal and state research and development tax credits. In the fourth quarter of 2025, we concluded that it is more likely than not that our net deferred tax assets are realizable, resulting in a valuation allowance release of $48.5 million. Our effective tax rate for 2024 differs from the U.S. federal statutory income tax rate of 21.0% primarily due to the valuation allowance previously maintained against our net deferred tax assets, partially offset by state and federal income taxes for the portion of our taxable income that was not offset by operating loss and tax credit carryforwards.
Variable Marketing Dollars and Margin
Year Ended December 31,
Change
Amount
(dollars in thousands)
Revenue
Less: total advertising expense (a
component of sales and marketing
expense)
Variable marketing dollars
Variable marketing margin
The increase in variable marketing dollars was due primarily to increased carrier spend. The decrease in variable marketing margin was primarily due to competitive pricing for advertising spend and the relative mix of referral types.
Comparison of the Years Ended December 31, 2024 and 2023
For a discussion of our results of operations for the year ended December 31, 2024 as compared to the year ended December 31, 2023, see Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations—Results of Operations—Comparison of the Years Ended December 31, 2024 and 2023 included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024.
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Liquidity and Capital Resources
Our principal sources of liquidity are cash and cash equivalents of $171.4 million as of December 31, 2025 and up to $60.0 million of availability under our revolving line of credit.
On August 1, 2025, we entered into a new senior secured revolving credit facility with the Lenders. This facility replaced the prior $25.0 million revolving line of credit with Western Alliance Bank. The Credit Agreement provides for a $60.0 million senior secured revolving line of credit. Subject to customary terms and conditions (including the absence of any default or event of default under the Credit Agreement), we shall have the right, from time to time, to request incremental revolving commitments in an aggregate amount not to exceed up to $25.0 million during the term of the Credit Agreement. Availability under the Credit Agreement will terminate on August 1, 2028, or the Revolving Commitment Period, and all outstanding revolving loans must be paid on or before such date. We will pay a commitment fee of 0.075% per annum on the average daily unused portion of commitments under the Credit Agreement during the Revolving Commitment Period.
Pursuant to the Credit Agreement, borrowings under the Revolving Facility cannot exceed 85% of eligible accounts receivable balances. Outstanding borrowings under the Revolving Facility bear interest, at our election, at a per annum rate equal to (i) an adjusted term secured overnight financing rate for a one-month tenor, or the Term SOFR, plus 2.10% or (ii) the higher of the “prime rate” quoted in The Wall Street Journal, the weighted average of the rates on overnight federal funds transactions with members of the Federal Reserve System plus 0.50%, or Term SOFR plus 1.00%, or the ABR, plus 1.10%. We may elect, from time to time, to convert all or any part of our Term SOFR loans to ABR loans or to convert all or any part of the ABR loans to Term SOFR loans. In an event of default, as defined in the Credit Agreement, and until such event is no longer continuing, the annual interest rate to be charged will be the annual rate otherwise applicable to borrowings at such time plus 2.00%.
Borrowings are collateralized by substantially all of our assets and property. Under the Credit Agreement, we have agreed to certain affirmative and negative covenants, reporting requirements and other customary requirements to which we will remain subject until maturity. The covenants include limitations on our ability to incur additional indebtedness, pay cash dividends, and engage in certain fundamental business transactions, such as mergers or acquisitions of other businesses. In addition, under the Credit Agreement and through the maturity date, for any period we do not maintain a minimum Adjusted Quick Ratio of 1.30 to 1.00, defined as the ratio of (1) the sum of (x) unrestricted cash and cash equivalents held at the Lenders plus (y) net accounts receivable reflected on our balance sheet (excluding accounts receivable that are more than 90 days past due, intercompany receivables, and receivables subject to dispute) to (2) current liabilities, including all borrowings outstanding under Credit Agreement, but excluding the current portion of deferred revenue (in each case determined substantially in accordance with GAAP), the Agent shall have the ability to use our cash receipts to repay outstanding obligations until such time as the Adjusted Quick Ratio is equal to or greater than 1.30 to 1.00 for two consecutive months.
On July 22, 2025, our board of directors authorized a share repurchase program for up to $50.0 million of our Class A common stock for one year from the board approval date. Share repurchases under the $50.0 million program may be made from time to time on the open market, pursuant to Rule 10b5-1 trading plans, or by other legally permissible means. The share repurchase program does not obligate us to acquire a specific number of shares, and may be suspended, modified, or terminated at any time, without prior notice. The number of shares to be repurchased will depend on market conditions and other factors. Repurchases under the program are expected to be funded from a combination of existing cash balances and future cash flow. In August 2025, we repurchased $21.0 million of Class A shares from Link Ventures and its affiliated entities, and as of December 31, 2025, $29.0 million remained available for stock repurchases pursuant to the board authorization. During January and February 2026, we repurchased an additional $8.7 million of Class A common shares under the program via a 10b5-1 trading plan.
We believe our existing cash and cash equivalents will be sufficient to fund our operating expenses and capital expenditure requirements for at least the next 12 months from the issuance date of the consolidated financial statements, without considering the borrowing availability under the Credit Agreement. Our future capital requirements may vary materially from those currently planned and will depend on many factors, including our revenue, the timing and extent of spending on business initiatives, purchases of common stock under our share repurchase program, purchases of capital equipment to support our growth, sales and marketing activities, expansion of our business through acquisitions or our investments in complementary offerings, technologies or businesses, market acceptance of our platform and overall economic conditions. If we do not achieve our revenue goals as planned, we believe that we can reduce our operating costs. If we need additional funds and are unable to obtain funding on a timely basis, we may need to significantly curtail our operations in an effort to provide sufficient funds to continue our operations, which could adversely affect our business prospects.
In addition, we have an effective universal shelf registration statement on Form S-3 with the SEC that permits us to sell up to $150.0 million of any combination of our common stock, preferred stock, debt securities, warrants, rights or units from time to time and at prices and on terms that we may determine. The net proceeds of any securities we sell under this registration statement may be used for general corporate purposes, including among other possible uses, the acquisition of companies or businesses, repayment and refinancing of debt, working capital and capital expenditures. At this time, we have no plans to sell any such securities under this registration statement.
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Cash Flows
The following table shows a summary of our cash flows:
Year Ended December 31,
(in thousands)
Net cash provided by (used in) operating activities
Net cash provided by (used in) investing activities
Net cash provided by (used in) financing activities
Effect of exchange rate changes on cash,
cash equivalents and restricted cash
Net increase in cash, cash equivalents
and restricted cash
Operating activities
Operating activities provided $95.4 million and $66.6 million of cash during the years ended December 31, 2025 and 2024, respectively. Cash provided by operating activities in the year ended December 31, 2025 resulted from our net income of $99.3 million, partially offset by net non-cash income of $2.4 million and net cash used by changes in our operating assets and liabilities of $1.6 million. Net non-cash income included a net increase in deferred taxes of $38.4 million, primarily due to the release of our valuation allowance, partially offset by a litigation accrual settled with the sale of assets of $7.8 million and other non-cash charges of $28.2 million. Net cash used by changes in our operating assets and liabilities consisted primarily of a $13.8 million increase in accounts receivable and a $4.4 million increase in prepaid expenses and other current assets, partially offset by a net $14.8 million increase in accounts payable and accrued expenses and other current liabilities.
Cash provided by operating activities in the year ended December 31, 2024 resulted from our net income of $32.2 million, net non-cash charges of $26.3 million and net cash provided by changes in our operating assets and liabilities of $8.1 million. Net cash provided by changes in our operating assets and liabilities consisted primarily of a $43.7 million increase in accounts payable and accrued expenses and other current liabilities and a $4.9 million decrease in commissions receivable, partially offset by a $40.2 million increase in accounts receivable.
Changes in accounts receivable, prepaid expenses and other current assets and accounts payable and accrued expenses and other current liabilities were generally due to level of activity in our business and timing of customer and vendor invoicing and payments.
Investing activities
Net cash used in investing activities was $5.1 million and $4.1 million for the years ended December 31, 2025 and 2024, respectively, consisting of cash used to acquire property and equipment, which included the capitalization of software development costs. During the years ended December 31, 2025 and 2024, we capitalized $4.6 million and $2.8 million, respectively, of software development costs.
Financing activities
During the year ended December 31, 2025, net cash used in financing activities was $21.1 million primarily due to $21.0 million used to repurchase common stock under our share repurchase program from Link Ventures and its affiliated entities. Cash proceeds received from the exercise of common stock options of $3.9 million during the year ended December 31, 2025 were offset by tax withholding payments of $4.0 million relating to net share settlements. During the year ended December 31, 2024, net cash provided by financing activities was $1.7 million, consisting of proceeds received from the exercise of common stock options, partially offset by tax withholding payments relating to net share settlements.
For a discussion of our cash flows for the year ended December 31, 2023 see Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Cash Flows included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024.
Contractual Obligations and Commitments
Our cash flows are dependent on a number of factors in addition to our operational expenditures, including our share repurchase program and our contractual and other obligations. As a result, our liquidity and capital resources in future periods should be analyzed in conjunction with such factors.
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We lease office space in Cambridge, Massachusetts under non-cancelable operating leases through December 2027. We lease office space in Belfast, Northern Ireland pursuant to a sublease that expires in July 2027. As of December 31, 2025, we were obligated to make total minimum lease payments of $2.8 million under such leases, of which $1.4 million is payable in 2026.
In June 2025, we entered into a five-year, $18.5 million purchase commitment, in the ordinary course of business, for advertising with specified annual minimum payment amounts through July 2029. The remaining purchase commitment as of December 31, 2025 was $15.5 million, of which $3.5 million relates to the next twelve months.
We have outstanding agreements with various vendors for hosting and other technical services. We believe that we will be able to fund these obligations through our existing cash and cash equivalents.
Critical Accounting Policies and Significant Judgments and Estimates
Our consolidated financial statements are prepared in accordance with GAAP. The preparation of our consolidated financial statements and related disclosures requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenue, costs and expenses, and the disclosure of contingent assets and liabilities in our consolidated financial statements. We base our estimates on historical experience, known trends and events, and various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. We evaluate our estimates and assumptions on an ongoing basis. Our actual results may differ from these estimates under different assumptions or conditions.
While our significant accounting policies are described in more detail in Note 2 to our audited consolidated financial statements, appearing in Part II, Item 8 of this Annual Report on Form 10-K, we believe that the following accounting policies are those most critical to the judgments and estimates used in the preparation of our consolidated financial statements.
Revenue Recognition
We derive our revenue primarily by selling consumer referrals to our insurance provider customers, including insurance carriers, agents and indirect distributors. To determine revenue recognition for arrangements that we determine are within the scope of ASC 606 Revenue from Contracts with Customers, or ASC 606, we perform the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) we satisfy a performance obligation.
We only apply the five-step model to contracts when collectibility of the consideration to which we are entitled in exchange for the goods or services we transfer to the customer is determined to be probable. Amounts are recorded as accounts receivable when our right to consideration is unconditional. We do not assess whether a contract has a significant financing component if the expectation at contract inception is that the period between payment by the customer and the transfer of the promised goods or services to the customer will be one year or less. We recognize referral revenue when we satisfy our performance obligations by delivering the referrals to our customers in an amount that reflects the consideration to which we expect to be entitled in exchange for those referrals.
Stock-Based Compensation
We measure stock options and other stock-based awards granted to employees, nonemployees and directors based on their fair value on the date of the grant. We recognize compensation expense of employee awards, net of estimated forfeitures, over the requisite service period, which is generally the vesting period of the respective award. We apply the straight-line method of expense recognition to all employee awards with only service-based vesting conditions and apply the graded-vesting method to all employee awards with both service-based and performance-based vesting conditions, commencing when achievement of the performance condition becomes probable. Compensation expense for nonemployee awards is recognized in the same manner as if we had paid cash for the goods or services received, which is generally the vesting period of the respective award.
We estimate the fair value of stock options with service-based vesting or performance-based vesting granted using the Black Scholes option pricing model, which uses as inputs the fair value of our common stock and assumptions we make for the volatility of our common stock, the expected term of our common stock options, the risk-free interest rate for a period that approximates the expected term of our common stock options, and our expected dividend yield. We estimate the fair value of RSUs granted based on the market value of our common stock on the date of grant.
Recently Issued Accounting Pronouncements
A description of recently issued accounting pronouncements that may potentially impact our financial position and results of operations is disclosed in Note 2 to our audited consolidated financial statements appearing in Part II, Item 8 of this Annual Report on Form 10-K.
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ITEM 7A. QUANTITATIVE AN D QUALITATIVE DISCLOSURES ABOUT MARKET RISK
We have a credit agreement that provides us with credit at a floating rate of interest. As of December 31, 2025, we had no outstanding borrowings under our credit facility and therefore no material exposure to fluctuations in interest rates.
We contract with vendors in foreign countries and we have foreign subsidiaries. As such, we have exposure to adverse changes in exchange rates of foreign currencies associated with our foreign transactions and our foreign subsidiaries. We believe this exposure to be immaterial. We do not hedge against this exposure to fluctuations in exchange rates.
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ITEM 8. CONSOLIDATED FINANCIAL ST ATEMENTS AND SUPPLEMENTARY DATA
EVERQUOTE, INC.
Index to Consolidated Financial Statements
Page(s)
Report of Independent Registered Public Accounting Firm (PCAOB ID 238 )
Consolidated Balance Sheets
Consolidated Statements of Operations and Comprehensive Income (Loss )
Consolidated Statements of Stockholders’ Equity
Consolidated Statements of Cash Flows
Notes to Consolidated Financial Statements
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Report of Independ ent Registered Public Accounting Firm
To the Board of Directors and Stockholders of EverQuote, Inc.
Opinions on the Financial Statements and Internal Control over Financial Reporting
We have audited the accompanying consolidated balance sheets of EverQuote, Inc. and its subsidiaries (the “Company”) as of December 31, 2025 and 2024, and the related consolidated statements of operations and comprehensive income (loss), of stockholders’ equity and of cash flows for each of the three years in the period ended December 31, 2025, including the related notes (collectively referred to as the “consolidated financial statements”). We also have audited the Company's internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025 in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO.
Basis for Opinions
The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in Management’s Report on Internal Control over Financial Reporting appearing under Item 9A. Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company's internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.
Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.
Definition and Limitations of Internal Control over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
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Critical Audit Matters
The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
Revenue Recognition – Revenue from Certain Referrals
As described in Note 2 to the consolidated financial statements, the Company derives its revenue primarily by selling consumer referrals to its insurance provider customers, including insurance carriers, agents and indirect distributors. Revenue from certain referrals makes up the majority of total revenue of $692.5 million. The Company recognizes referral revenue when it satisfies its performance obligations by delivering the referrals to its customers in an amount that reflects the consideration to which it expects to be entitled in exchange for those referrals.
The principal consideration for our determination that performing procedures relating to revenue recognition from certain referrals is a critical audit matter is a high degree of auditor effort in performing procedures related to the Company’s revenue recognition from certain referrals.
Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to the referral revenue recognition process. These procedures also included, among others (i) evaluating revenue from certain referral transactions by testing the issuance and settlement of invoices and credit memos; (ii) tracing transactions not settled to a detailed listing of accounts receivable; (iii) confirming a sample of outstanding customer invoice balances at year end and, where applicable, obtaining and inspecting source documents, such as subsequent cash receipts, invoices, and other supporting documentation for confirmations not returned; and (iv) testing the completeness and accuracy of data provided by management.
/s/ PricewaterhouseCoopers LLP
Boston, Massachusetts
February 24, 2026
We have served as the Company’s auditor since 2014.
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EVERQUOTE, INC.
CONSOLIDATED BALAN CE SHEETS
(in thousands, except share and per share amounts)
December 31,
Assets
Current assets:
Cash and cash equivalents
Accounts receivable, net
Commissions receivable, current portion
Prepaid expenses and other current assets
Total current assets
Property and equipment, net
Goodwill
Acquired intangible assets, net
Operating lease right-of-use assets
Deferred tax assets
Commissions receivable, non-current portion
Other assets
Total assets
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable
Accrued expenses and other current liabilities
Deferred revenue
Operating lease liabilities
Total current liabilities
Deferred tax liabilities
Operating lease liabilities, net of current portion
Total liabilities
Commitments and contingencies (Note 11)
Stockholders' equity:
Preferred stock, $ 0.001 par value; 10,000,000 shares authorized;
no shares issued and outstanding
Class A common stock, $ 0.001 par value; 220,000,000 shares authorized;
32,642,124 shares and 32,037,421 shares issued and outstanding
at December 31, 2025 and 2024, respectively
Class B common stock, $ 0.001 par value; 30,000,000 shares authorized;
3,604,278 shares issued and outstanding at
December 31, 2025 and 2024, respectively
Additional paid-in capital
Accumulated other comprehensive income
Accumulated deficit
Total stockholders' equity
Total liabilities and stockholders' equity
The accompanying notes are an integral part of these consolidated financial statements.
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EVERQUOTE, INC.
CONSOLIDATED S TATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
(in thousands, except per share amounts)
Year Ended December 31,
Revenue
Cost and operating expenses:
Cost of revenue
Sales and marketing
Research and development
General and administrative
Legal settlement
Restructuring and other charges
Acquisition-related costs
Total cost and operating expenses
Income (loss) from operations
Other income (expense):
Interest income
Other income (expense), net
Total other income, net
Income (loss) before income taxes
Income tax benefit (expense)
Net income (loss)
Net income (loss) per share:
Basic
Diluted
Weighted average common shares outstanding:
Basic
Diluted
Comprehensive income (loss):
Net Income (loss)
Other comprehensive income (loss):
Foreign currency translation adjustment
Comprehensive income (loss)
The accompanying notes are an integral part of these consolidated financial statements.
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EVERQUOTE, INC.
CONSOLIDATED STATEMENT S OF STOCKHOLDERS’ EQUITY
(in thousands, except share amounts)
Accumulated
Class A
Class B
Additional
Other
Total
Common Stock
Common Stock
Paid-in
Comprehensive
Accumulated
Stockholders’
Shares
Amount
Shares
Amount
Capital
Income (Loss)
Deficit
Equity
Balances at December 31, 2022
Issuance of common stock upon
exercise of stock options
Net issuance of common stock upon
vesting of restricted stock units
Stock-based compensation expense
Transfer of Class B common stock
to Class A common stock
Foreign currency translation
adjustment
Net loss
Balances at December 31, 2023
Issuance of common stock upon
exercise of stock options
Net issuance of common stock
upon vesting of restricted
stock units
Transfer of Class B common stock
to Class A common stock
Stock-based compensation expense
Foreign currency translation
adjustment
Net income
Balances at December 31, 2024
Issuance of common stock upon
exercise of stock options
Net issuance of common stock
upon vesting of restricted
stock units
Repurchase and retirement of
common stock
Stock-based compensation expense
Foreign currency translation
adjustment
Net income
Balances at December 31, 2025
The accompanying notes are an integral part of these consolidated financial statements.
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EVERQUOTE, INC.
CONSOLIDATE D STATEMENTS OF CASH FLOWS
(in thousands)
Year Ended December 31,
Cash flows from operating activities:
Net income (loss)
Adjustments to reconcile net income (loss) to net cash provided by
(used in) operating activities:
Depreciation and amortization expense
Stock-based compensation expense
Deferred taxes
Loss on sale of health assets
Impairment of right-of-use asset
Change in fair value of contingent consideration liabilities
Provision for bad debt
Unrealized foreign currency transaction (gains) losses
Litigation accrual settled with sale of assets
Changes in operating assets and liabilities:
Accounts receivable
Prepaid expenses and other current assets
Commissions receivable, current and non-current
Operating lease right-of-use assets
Other assets
Accounts payable
Accrued expenses and other current liabilities
Deferred revenue
Operating lease liabilities
Net cash provided by (used in) operating activities
Cash flows from investing activities:
Acquisition of property and equipment, including costs capitalized
for development of internal-use software
Proceeds from sale of health assets
Net cash provided by (used in) investing activities
Cash flows from financing activities:
Proceeds from exercise of stock options
Repurchase of common stock
Tax withholding payments related to net share settlement
Net cash provided by (used in) financing activities
Effect of exchange rate changes on cash, cash equivalents and restricted cash
Net increase in cash, cash equivalents and restricted cash
Cash, cash equivalents and restricted cash at beginning of period
Cash, cash equivalents and restricted cash at end of period
Supplemental disclosure of noncash investing and
financing information:
Acquisition of property and equipment included in accounts payable
Assets sold in settlement of litigation accrual
Operating lease liabilities arising from obtaining right-of-use assets
The accompanying notes are an integral part of these consolidated financial statements.
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EVERQUOTE, INC.
NOTES TO CONSOLIDAT ED FINANCIAL STATEMENTS
1. Nature of the Business and Basis of Presentation
EverQuote, Inc. (the “Company”) was incorporated in the state of Delaware in 2008. Through its internet websites, the Company operates an online marketplace for consumers shopping for property and casualty insurance. The Company generates revenue primarily by selling consumer referrals to insurance provider customers, consisting of carriers and agents, and indirect distributors in the United States.
The Company is subject to a number of risks and uncertainties common to companies in similar industries and stages of development including, but not limited to, rapid technological changes, competition from substitute products and services from larger companies, protection of proprietary technology, customer concentration, patent litigation, the need to obtain additional financing to support growth and dependence on third parties and key individuals.
The accompanying consolidated financial statements have been prepared on the basis of continuity of operations, realization of assets and the satisfaction of liabilities and commitments in the ordinary course of business. As of the issuance date of these consolidated financial statements, the Company expects that its cash and cash equivalents will be sufficient to fund its operating expenses and capital expenditure requirements for at least the next 12 months from the issuance date of the consolidated financial statements, without considering borrowing availability under the Company’s credit facility.
The Company’s consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”). Any reference in these notes to applicable guidance is meant to refer to the authoritative GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Update (“ASU”) of the Financial Accounting Standards Board (“FASB”). The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation.
2. Summary of Significant Accounting Policies
Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting periods. Significant estimates and assumptions reflected in these consolidated financial statements include, but are not limited to, revenue recognition and the valuation of accounts receivable, the expensing and capitalization of website and software development costs, the valuation of stock-based awards and income taxes. The Company bases its estimates on historical experience, known trends and other market-specific or relevant factors that it believes to be reasonable under the circumstances. On an ongoing basis, management evaluates its estimates, as there are changes in circumstances, facts and experience. Changes in estimates are recorded in periods in which they become known. These estimates may change, as new events occur and additional information is obtained and actual results could differ materially from these estimates.
Cash Equivalents
The Company considers all highly liquid investments with maturities of three months or less from the date of purchase to be cash equivalents.
Concentrations of Credit Risk and of Significant Customers
Financial instruments that potentially expose the Company to concentrations of credit risk consist primarily of cash and cash equivalents and accounts receivable. The Company maintains its cash and cash equivalents at accredited financial institutions. The Company does not believe that it is subject to unusual credit risk beyond the normal credit risk associated with commercial banking relationships.
The Company sells its consumer referrals to insurance provider customers, consisting of carriers and agents, and indirect distributors in the United States, primarily in the automotive insurance industry. For the year ended December 31, 2025 , two customers represented 38 % and 11 %, respectively, of total revenue. For the year ended December 31, 2024, one customer represented 39 % of total revenue. For the year ended December 31, 2023, one customer represented 18 % of total revenue. As of December 31, 2025 , two customers accounted for 36 % and 11 %, respectively, of the total accounts receivable balance. As of December 31, 2024, two customers accounted for 40 % and 21 %, respectively, of the total accounts and commissions receivable balance.
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Accounts Receivable
The Company provides credit to customers in the ordinary course of business and believes its credit policies are prudent and reflect industry practices and business risk. The Company monitors economic conditions to identify facts or circumstances that may indicate that its receivables are at risk of collection. The Company provides reserves against accounts receivable for estimated losses, if any, that may result from a customer’s inability to pay based on the composition of its accounts receivable, current economic conditions, and historical credit loss activity. Amounts determined to be uncollectible are charged or written-off against the reserve. As of December 31, 2025 and 2024 , the Company’s allowance for credit losses was $ 0.1 million. During the years ended December 31, 2025 and 2024, the Company wrote off an insignificant amount of uncollectible accounts. During the year ended December 31, 2023, the Company wrote off $ 0.9 million of uncollectible accounts.
Revenue Recognition
The Company derives its revenue primarily by selling consumer referrals to its insurance provider customers, including insurance carriers, agents and indirect distributors. To determine revenue recognition for arrangements that the Company determines are within the scope of ASC 606 Revenue from Contracts with Customers (“ASC 606”), the Company performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the Company satisfies a performance obligation.
The Company only applies the five-step model to contracts when collectibility of the consideration to which the Company is entitled in exchange for the goods or services it transfers to the customer is determined to be probable. Amounts are recorded as accounts receivable when the Company’s right to consideration is unconditional. The Company does not assess whether a contract has a significant financing component if the expectation at contract inception is that the period between payment by the customer and the transfer of the promised goods or services to the customer will be one year or less.
Referral Revenue
The Company recognizes referral revenue when it satisfies its performance obligations by delivering the referrals to its customers in an amount that reflects the consideration to which it expects to be entitled in exchange for those referrals.
Commission Revenue
Prior to the sale of carrier contracts in May 2025 (see Note 3), the Company also generated revenue in the automotive insurance vertical from commission fees for the sale of policies as part of its direct to consumer agency and, prior to its exit from the health insurance vertical in 2023 (see Note 15), the Company also generated commission revenue in its other insurance vertical. Commission revenue represented less than 1 % of total revenue for each of the years ended December 31, 2025 and 2024, and less than 10 % of revenue for the year ended December 31, 2023.
Disaggregated Revenue
The Company presents disaggregated revenue from contracts with customers by distribution channel, as the distribution channel impacts the nature and amount of the Company’s revenue, and by vertical market segment. The Company’s direct distribution channel consists of insurance carriers and third-party agents. The Company’s indirect distribution channel consists of insurance aggregators and media networks who purchase referrals with the intent to resell. Revenue generated via the Company’s direct distribution channel is generally higher per referral than revenue generated by the Company’s indirect distribution channels and provides the Company with additional insights and data regarding insurance provider demand and referral performance.
Total revenue is comprised of revenue from the following distribution channels:
Year Ended December 31,
Direct channels
Indirect channels
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Total revenue is comprised of revenue from the following insurance verticals (in thousands):
Year Ended December 31,
Automotive
Home and renters
Other
Total Revenue
The Company has elected to apply the practical expedient in ASC 606 to expense incremental direct costs of obtaining a contract, consisting of sales commissions, as incurred as the expected period of benefit of the sales commissions is one year or less . At December 31, 2025 and 2024, the Company had not capitalized any costs to obtain any of its contracts.
Deferred Revenue
Amounts received for referrals prior to satisfying the revenue recognition criteria are recorded as deferred revenue in the accompanying balance sheets. Amounts expected to be recognized as revenue within 12 months of the balance sheet date are classified as current deferred revenue. Deferred revenue was $ 1.7 million and $ 1.8 million as of December 31, 2025 and 2024, respectively. During the year ended December 31, 2025 , the Company recognized revenue of $ 1.6 million that was included in the contract liability balance (deferred revenue) at December 31, 2024 . The Company recognizes deferred revenue by first allocating from the beginning deferred revenue balance to the extent that the beginning deferred revenue balance exceeds the revenue to be recognized. Billings during the period are added to the deferred revenue balance to be recognized in future periods.
Goodwill and Acquired Intangible Assets
The Company records goodwill when consideration paid in a business acquisition exceeds the value of the net assets acquired. The Company’s estimates of fair value are based upon assumptions believed to be reasonable at that time but that are inherently uncertain and unpredictable. Assumptions may be incomplete or inaccurate, and unanticipated events or circumstances may occur, which may affect the accuracy or validity of such assumptions, estimates or actual results. Goodwill is not amortized, but rather is tested for impairment annually in the fourth quarter, or more frequently if facts and circumstances warrant a review, such as significant underperformance of the business in relation to expectations, significant negative industry or economic trends and significant changes or planned changes in the use of the assets. The Company’s goodwill is evaluated at the consolidated level as it has been determined there is one operating segment comprised of one reporting unit. The Company performs a quantitative assessment, which compares the fair value of the reporting unit with its carrying value. If the carrying amount of the reporting unit exceeds its fair value, an impairment is recognized.
Intangible assets are recorded at their estimated fair values at the date of acquisition. The Company amortizes acquired intangible assets over their estimated useful lives based on the pattern of consumption of the economic benefits or, if that pattern cannot be readily determined, on a straight-line basis.
Deferred Financing Costs
The Company capitalizes lender, legal and other third-party fees that are directly associated with obtaining access to capital under credit facilities. Deferred financing costs incurred in connection with obtaining access to capital are recorded in prepaid expenses and other current assets and are amortized over the availability period or term of the credit facility. Deferred financing costs related to a recognized debt liability are recorded as a direct reduction of the carrying amount of the debt liability and amortized to interest expense on an effective interest basis over the repayment term.
Property and Equipment
Property and equipment are stated at cost less accumulated depreciation and amortization. Depreciation and amortization expense is recognized using the straight-line method over the estimated useful life of each asset as follows:
Estimated Useful Life
Computer equipment
3 years
Software
3 years
Furniture and fixtures
5 years
Leasehold improvements
Shorter of lease term or estimated useful life
Upon retirement or sale, the cost of assets disposed of and the related accumulated depreciation and amortization are removed from the accounts and any resulting gain or loss is included in loss from operations on the statements of operations and comprehensive income (loss). Expenditures for repairs and maintenance are charged to expense as incurred.
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Leases
The Company accounts for leases under ASC Topic 842, Leases (“ASC 842”). In accordance with ASC 842, the Company accounts for a contract as a lease when it has the right to control the asset for a period of time while obtaining substantially all of the asset’s economic benefits. The Company determines if an arrangement is a lease or contains an embedded lease at inception. For arrangements that meet the definition of a lease, the Company determines the initial classification and measurement of its right-of-use asset and lease liability at the lease commencement date and thereafter if modified. The lease term includes any renewal options that the Company is reasonably assured to exercise. The present value of lease payments is determined by using the interest rate implicit in the lease, if that rate is readily determinable; otherwise, the Company uses its estimated secured incremental borrowing rate for that lease term. The Company’s policy is to not record leases with an original term of 12 months or less on its consolidated balance sheets and recognizes those lease payments in the income statement on a straight-line basis over the lease term. The Company’s existing leases are for office space.
In addition to rent, the leases may require the Company to pay additional costs, such as utilities, maintenance and other operating costs, which are generally referred to as non-lease components. The Company has elected to not separate lease and non-lease components. Only the fixed costs for lease components and their associated non-lease components are accounted for as a single lease component and recognized as part of a right-of-use asset and lease liability. Rent expense for operating leases is recognized on a straight-line basis over the reasonably assured lease term based on the total lease payments and is included in operating expense in the consolidated statements of operations and comprehensive income (loss).
Impairment of Long-Lived Assets
Long-lived assets to be held and used are tested for recoverability whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable. Factors that the Company considers in deciding when to perform an impairment review include significant underperformance of the business in relation to expectations, significant negative industry or economic trends and significant changes or planned changes in the use of the assets. If an impairment review is performed to evaluate a long-lived asset group for recoverability, the Company compares forecasts of undiscounted cash flows expected to result from the use and eventual disposition of the long-lived asset group to its carrying value. An impairment loss would be recognized in loss from operations when estimated undiscounted future cash flows expected to result from the use of an asset group are less than its carrying amount. The impairment loss would be based on the excess of the carrying value of the impaired asset group over its fair value, determined based on discounted cash flows. The Company did no t record any on long-lived assets during the years ended December 31, 2025 or 2024. In connection with its and exit from the health vertical in 2023, the Company recorded of a right-of-use asset (see Note 15).
Fair Value Measurements
Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. Financial assets and liabilities carried at fair value are to be classified and disclosed in one of the following three levels of the fair value hierarchy, of which the first two are considered observable and the last is considered unobservable:
Level 1—Quoted prices in active markets for identical assets or liabilities.
Level 2—Observable inputs (other than Level 1 quoted prices), such as quoted prices in active markets for similar assets or liabilities, quoted prices in markets that are not active for identical or similar assets or liabilities, or other inputs that are observable or can be corroborated by observable market data.
Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to determining the fair value of the assets or liabilities, including pricing models, discounted cash flow methodologies and similar techniques.
The Company’s cash equivalents are carried at fair value, determined according to the fair value hierarchy described above. The Company's cash equivalents included money market funds of $ 15.3 million and $ 7.4 million as of December 31, 2025 and 2024, respectively, which were valued based on quoted market prices, representing a Level 1 measurement within the fair value hierarchy. The carrying values of the Company’s accounts receivable, accounts payable and accrued expenses and other current liabilities approximate their fair values due to the short-term nature of these assets and liabilities.
Segment Information
The Company manages its operations as a single segment for the purposes of assessing performance and making operating decisions. The Company operates an online marketplace for consumers shopping for property and casualty insurance and generates revenue principally from referral fees.
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Research and Development
Research and development expenses consist primarily of personnel-related expenses (wages, fringe benefit costs and stock-based compensation expense) for product management and software development. Research and development costs are expensed as incurred, except for certain costs which are capitalized in connection with the development of the Company’s website and internal-use software.
Costs incurred in the preliminary and post-implementation stages of development are expensed as incurred. Once an application has reached the development stage, internal costs, if direct and incremental, are capitalized until the software is substantially complete and ready for its intended use. Capitalization ceases upon completion of all substantial testing performed to ensure the product is ready for its intended use. The Company also capitalizes costs related to specific upgrades and enhancements of its website and internal-use software when it is probable that the expenditures will result in additional functionality. Maintenance and training costs are expensed as incurred. Capitalized software costs are recorded as part of property and equipment and are amortized on a straight-line basis over an estimated useful life of three years .
Advertising Expense
Advertising expense consists of variable costs that are related to attracting consumers to the Company’s marketplace and generating consumer quote requests, including through its verified partner network, and promoting its marketplace to insurance carriers and agents. The Company expenses advertising costs as incurred and such costs are included in sales and marketing expense in the accompanying statements of operations and comprehensive income (loss). During the years ended December 31, 2025, 2024 and 2023, advertising expense totaled $ 500.7 million, $ 345.0 million and $ 187.6 million, respectively.
Stock-Based Compensation
The Company measures compensation expense for stock options with service-based vesting or performance-based vesting granted to employees, nonemployees and directors based on the fair value on the date of grant using the Black-Scholes option-pricing model. The Company measures compensation expense for restricted common stock units based on the fair value on the date of grant using the market value of the Company’s common stock. Compensation expense for employee awards is recognized, net of estimated forfeitures, over the requisite service period, which is generally the vesting period of the respective award. The Company uses the straight-line method to record the expense of employee awards with only service-based vesting conditions. The Company uses the graded-vesting method to record the expense of employee awards with both service-based and performance-based vesting conditions, commencing once achievement of the performance condition becomes probable. Compensation expense for nonemployee awards is recognized in the same manner as if the Company had paid cash for the goods or services received, which is generally the vesting period of the respective award.
The Company classifies stock-based compensation expense in its statements of operations and comprehensive income (loss) in the same manner in which the award recipient’s payroll costs are classified or in which the award recipient’s service payments are classified.
Foreign Currency Translation
The functional currency of the Company’s foreign subsidiaries is the currency of the local country. Assets and liabilities of the Company’s foreign subsidiaries are translated into U.S. dollars using the period-end exchange rates, and income and expense items are translated into U.S. dollars using average exchange rates in effect during each period. The effects of these foreign currency translation adjustments are included in accumulated other comprehensive income (loss), a separate component of stockholders’ equity. The Company also incurs transaction gains and losses resulting from intercompany transactions as well as transactions with customers or vendors denominated in currencies other than the functional currency of the legal entity in which the transaction is recorded. Foreign currency transaction gains (losses) are included in the consolidated statements of operations and comprehensive income (loss) as a component of other income (expense) and have not been significant.
Comprehensive Income (Loss)
Comprehensive income (loss) includes net income (loss) as well as other changes in stockholders’ equity that result from transactions and economic events other than those with stockholders. The Company’s only element of other comprehensive income (loss) is foreign currency translation adjustments.
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Net Income (Loss) per Share
Basic net income (loss) per common share is computed by dividing the net income (loss) by the weighted average number of shares of common stock outstanding for the period. Diluted net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of common shares outstanding for the period, including potential dilutive common shares assuming the dilutive effect of outstanding stock options and unvested restricted stock units. For periods in which the Company reported a net loss, diluted net loss per common share is the same as basic net loss per common share, since dilutive common shares are not assumed to have been issued if their effect is anti-dilutive.
The Company has two classes of common stock outstanding: Class A common stock and Class B common stock. As more fully described in Note 7, the rights of the holders of Class A and Class B common stock are identical, except with respect to voting and conversion. Each share of Class B common stock is convertible into one share of Class A common stock at the option of the holder at any time. The Company allocates undistributed earnings attributable to common stock between the common stock classes on a one-to-one basis when computing net income (loss) per share. As a result, basic and diluted net income (loss) per share of Class A common stock and Class B common stock are equivalent.
Income Taxes
The Company accounts for income taxes using the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in the consolidated financial statements or in the Company’s tax returns. Deferred tax assets and liabilities are determined on the basis of the differences between the financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. Changes in deferred tax assets and liabilities are recorded in the provision for income taxes. The Company assesses the likelihood that its deferred tax assets will be recovered from future taxable income and, to the extent it believes, based upon the weight of available evidence, that it is more likely than not that all or a portion of the deferred tax assets will not be realized, a valuation allowance is established through a charge to income tax expense. Potential for recovery of deferred tax assets is evaluated by estimating the future taxable profits expected and considering prudent and feasible tax planning strategies.
The Company accounts for uncertainty in income taxes recognized in the consolidated financial statements by applying a two-step process to determine the amount of tax benefit to be recognized. First, the tax position must be evaluated to determine the likelihood that it will be sustained upon external examination by the taxing authorities. If the tax position is deemed more-likely-than-not to be sustained, the tax position is then assessed to determine the amount of benefit to recognize in the consolidated financial statements. The amount of the benefit that may be recognized is the largest amount that has a greater than 50% likelihood of being realized upon ultimate settlement. The provision for income taxes includes the effects of any resulting tax reserves, or unrecognized tax benefits, that are considered appropriate as well as the related net interest and penalties. The Company’s policy is to record interest and penalties related to income taxes as part of the tax provision.
Recently Adopted Accounting Pronouncements
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires public entities, on an annual basis, to provide disclosure of specific categories in the rate reconciliation, as well as disclosure of income taxes paid disaggregated by jurisdiction. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024, with early adoption permitted. The Company adopted ASU 2023-09 for the year ended December 31, 2025 , and applied the new disclosure requirements prospectively to the current annual period. Prior period disclosures have not been adjusted to reflect the new disclosure requirements.
Recently Issued Accounting Pronouncements
In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40) to improve financial reporting by requiring that public business entities disclose additional information about specific expense categories in the notes to financial statements at interim and annual reporting periods. ASU 2024-03 is effective for annual periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027, with early adoption permitted. ASU 2024-03 allows for adoption using either a prospective or retrospective method. The Company is currently assessing the impact of the adoption of this guidance on its consolidated financial statements.
In July 2025, the FASB issued ASU 2025-05, Financial Instruments—Credit Losses (Topic 326) to introduce a practical expedient to calculating current expected credit loss by assuming that the current conditions as of the balance sheet date will not change for the remaining life of the asset. This expedient can only be applied to current accounts receivable and current contract assets. ASU 2025-05 is effective for annual reporting periods beginning after December 15, 2025 and interim periods within those annual periods, and this update is applied prospectively. Early adoption is permitted in both interim and annual periods in which financials have not been issued. The Company is currently assessing the impact of the adoption of this guidance on its consolidated financial statements.
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In September 2025, the FASB issued ASU 2025-06, Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, which removes all references to software development project stages and requires entities to start capitalizing software costs when both of the following occur: (i) management has authorized and committed to funding the software project and (ii) it is probable that the project will be completed and the software will be used to perform the function intended. The amendments in ASU 2025-06 are effective for fiscal years beginning after December 15, 2027, and interim periods within those fiscal years, with early adoption permitted as of the beginning of a fiscal year. The amendments can be applied prospectively, retrospectively, or via a modified prospective transition method. The Company is currently assessing the impact of the adoption of this guidance on its consolidated financial statements.
3. Goodwill and Acquired Intangible Assets
Goodwill is not amortized, but instead is reviewed for impairment at least annually or more frequently when events and circumstances occur indicating that the recorded goodwill may be impaired. The Company considers its business to be one reporting unit for purposes of performing its goodwill impairment analysis. To date, the Company has had no impairments to goodwill. There were no changes to goodwill as of December 31, 2025 or 2024.
Prior to their sale in 2025, acquired intangible assets consisted of customer relationships and developed technology related to the Company's acquisition of Policy Fuel, LLC and its affiliated entities, Kanopy Insurance Center, LLC, One Eighty Software, Inc., Parachute Insurance Services Corp., collectively referred to as “PolicyFuel,” as follows (amounts in thousands):
December 31, 2024
Weighted Average Useful Life
Gross Amount
Accumulated Amortization
Carrying Value
(in years)
Customer relationships
Developed technology
On May 1, 2025, as part of the settlement of litigation, the customer relationships and developed technology intangible assets were sold to the former owners of PolicyFuel (the “Buyers”) by entering into and contemporaneously closing a Purchase and Sale Agreement (the “Purchase Agreement”) with the Buyers in which the Company sold the right to receive commissions under the remaining property and casualty carrier contracts related to its direct to consumer agency and certain related software and obligations related to that commission stream. Pursuant to the Purchase Agreement, the Company sold Parachute Insurance Services Corp. and One Eighty Software, Inc. to the Buyers for cash consideration of $ 0.5 million.
The Company recorded a litigation accrual of $ 8.1 million relating to the settlement agreement, of which $ 7.8 million was recorded as legal settlement expense in 2025 and $ 0.3 million had been recorded in a prior year. The litigation accrual was settled by the derecognition of the assets sold, consisting of commissions receivables and intangible assets, including customer relationships and developed technology, net of cash received. The carrying value of the commissions receivables and intangible assets sold was $ 5.7 million and $ 2.9 million, respectively, as of May 1, 2025. The Company also recorded $ 0.4 million of legal expenses related to the settlement as legal settlement expense in 2025.
Amortization expense for intangible assets for the years ended December 31, 2025, 2024 and 2023 was $ 0.4 million, $ 1.9 million and $ 1.8 million, respectively.
4. Property and Equipment, Net
Property and equipment, net consisted of the following (in thousands):
December 31,
Computer equipment
Software
Furniture and fixtures
Leasehold improvements
Less: Accumulated depreciation and amortization
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Depreciation and amortization expense was $ 3.4 million, $ 3.7 million and $ 4.4 million for the years ended December 31, 2025, 2024 and 2023 , respectively. In connection with its move to new headquarters in 2024, the Company retired $ 3.4 million of fully depreciated assets.
The Company capitalized costs associated with the development of internal use software of $ 4.6 million, $ 2.8 million and $ 3.6 million included in the Software line item above and recorded related amortization expense of $ 2.9 million, $ 3.2 million and $ 3.7 million (included in depreciation and amortization expense) during the years ended December 31, 2025, 2024 and 2023, respectively. The remaining net book value of capitalized software costs was $ 6.6 million and $ 4.9 million as of December 31, 2025 and 2024 , respectively .
5. Accrued Expenses and Other Current Liabilities
Accrued expenses and other current liabilities consisted of the following (in thousands):
December 31,
Accrued employee compensation and benefits
Accrued advertising expenses
Other current liabilities
6. Loan and Security Agreement
On August 1, 2025, the Company entered into a credit agreement (the “Credit Agreement”) providing for a senior secured revolving credit facility (the “Revolving Facility”) among the Company, as borrower, Western Alliance Bank, as administrative agent and collateral agent for the lenders (the “Agent”) and as a lender itself, and the other lenders party thereto (collectively, the “Lenders”). The Credit Agreement provides for a $ 60.0 million senior secured revolving line of credit. Subject to customary terms and conditions (including the absence of any default or event of default under the Credit Agreement), the Company shall have the right, from time to time, to request incremental revolving commitments in an aggregate amount not to exceed up to $ 25.0 million during the term of the Credit Agreement. Availability under the Credit Agreement will terminate on August 1, 2028 (the “Revolving Commitment Period”), and all outstanding revolving loans must be paid on or before such date. The Company will pay a commitment fee of 0.075 % per annum on the average daily unused portion of commitments under the Credit Agreement during the Revolving Commitment Period. This facility replaced the prior $ 25.0 million revolving line of credit with Western Alliance Bank.
Pursuant to the Credit Agreement, borrowings under the Revolving Facility cannot exceed 85 % of eligible accounts receivable balances. Outstanding borrowings under the Revolving Facility bear interest, at the Company’s election, at a per annum rate equal to (i) an adjusted term secured overnight financing rate for a one-month tenor (“Term SOFR”) plus 2.10 % or (ii) the higher of the “prime rate” quoted in The Wall Street Journal, the weighted average of the rates on overnight federal funds transactions with members of the Federal Reserve System plus 0.50 %, or Term SOFR plus 1.00 % (“ABR”), plus 1.10 %. The Company may elect, from time to time, to convert all or any part of our Term SOFR loans to ABR loans or to convert all or any part of the ABR loans to Term SOFR loans. In an event of default, as defined in the Credit Agreement, and until such event is no longer continuing, the annual interest rate to be charged will be the annual rate otherwise applicable to borrowings at such time plus 2.00 %.
Borrowings are collateralized by substantially all of the Company's assets and property. Under the Credit Agreement, the Company has agreed to certain affirmative and negative covenants, reporting requirements and other customary requirements to which it will remain subject until maturity. The covenants include limitations on its ability to incur additional indebtedness, pay cash dividends, and engage in certain fundamental business transactions, such as mergers or acquisitions of other businesses. In addition, under the Credit Agreement and through the maturity date, for any period the Company does not maintain a minimum Adjusted Quick Ratio of 1.30 to 1.00, defined as the ratio of (1) the sum of (x) unrestricted cash and cash equivalents held at the Lenders plus (y) net accounts receivable reflected on the Company's balance sheet (excluding accounts receivable that are more than 90 days past due, intercompany receivables, and receivables subject to dispute) to (2) current liabilities, including all borrowings outstanding under Credit Agreement, but excluding the current portion of deferred revenue (in each case determined substantially in accordance with GAAP), the Agent shall have the ability to use the Company's cash receipts to repay outstanding obligations until such time as the Adjusted Quick Ratio is equal to or greater than 1.30 to 1.00 for two consecutive months.
As of December 31, 2025, the Company was in compliance with its covenants and had no amounts outstanding under the Credit Agreement.
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7. Equity
Each share of Class A common stock entitles the holder to one vote for each share on all matters submitted to a vote of the Company’s stockholders at all meetings of stockholders and written actions in lieu of meetings. Each share of Class B common stock entitles the holder to ten votes for each share on all matters submitted to a vote of the Company’s stockholders at all meetings of stockholders and written actions in lieu of meetings.
Holders of both classes of common stock are entitled to receive dividends, when and if declared by the board of directors.
Each share of Class B common stock is convertible into one share of Class A common stock at the option of the holder at any time. Automatic conversion shall occur upon the occurrence of a transfer of such share of Class B common stock or at the date and time, or the occurrence of an event, specified by a vote or written consent of the holders of a majority of the voting power of the then outstanding shares of Class B common stock. A transfer is described as a sale, assignment, transfer, conveyance, hypothecation or disposition of such share or any legal or beneficial interest in such share other than certain permitted transfers as described in the Restated Certificate of Incorporation, including a transfer to a holder of Preferred Stock. Each share of Class B common stock held by a stockholder shall automatically convert into one fully paid and non-assessable share of Class A common stock nine months after the death or incapacity of the holder of such Class B common stock.
Share Repurchase Program
On July 22, 2025, the Company’s board of directors authorized a share repurchase program for up to $ 50.0 million of the Company’s Class A common stock for one year from the board approval date. Share repurchases under the new $ 50.0 million program may be made from time to time on the open market, pursuant to Rule 10b5-1 trading plans, or by other legally permissible means. The share repurchase program does not obligate the Company to acquire a specific number of shares, and may be suspended, modified, or terminated at any time, without prior notice. Repurchased shares are immediately retired and resume the status of authorized but unissued shares of common stock.
On August 11, 2025, the Company repurchased 900,000 shares of Class A common stock under the program in a negotiated transaction with a related party at a purchase price of $ 23.33 per share for an aggregate purchase price of $ 21.0 million (see Note 13). As of December 31, 2025 , $ 29.0 million remained available for stock repurchases pursuant to the board authorization. During January and February 2026, the Company repurchased an additional $ 8.7 million of Class A common shares under the program via a 10b5-1 trading plan (see Note 17).
8. Stock-Based Compensation
2008 and 2018 Plans
The Company has outstanding awards under its 2008 Stock Incentive Plan, as amended (the “2008 Plan”), but is no longer granting awards under this plan. Shares of common stock issued upon exercise of stock options granted prior to September 8, 2017 will be issued as either Class A common stock or Class B common stock. Shares of common stock issued upon exercise of stock options granted after September 8, 2017 will be issued as Class A common stock.
The Company’s 2018 Equity Incentive Plan (the “2018 Plan” and, together with the 2008 Plan, the “Plans”) provides for the grant of incentive stock options, non-qualified stock options, stock appreciation rights, restricted stock awards, restricted stock units, and other stock-based awards. The number of shares initially reserved for issuance under the 2018 Plan is the sum of 2,149,480 shares of Class A common stock, plus the number of shares (up to 5,028,832 shares) equal to the sum of (i) the 583,056 shares of Class A common stock and Class B common stock that were available for grant under the 2008 Plan upon the effectiveness of the 2018 Plan and (ii) the number of shares of Class A common stock and Class B common stock subject to outstanding awards under the 2008 Plan that expire, terminate or are otherwise surrendered, canceled, forfeited or repurchased by the Company at their original issuance price pursuant to a contractual repurchase right (subject, in the case of incentive stock options, to any limitations of the Internal Revenue Code). The number of shares of Class A common stock that may be issued under the 2018 Plan automatically increases on the first day of each fiscal year until, and including, the fiscal year ending December 31, 2028, by an amount equal to the least of (i) 2,500,000 shares of Class A common stock; (ii) 5 % of the sum of the number of shares of Class A common stock and Class B common stock outstanding on the first day of such fiscal year; and (iii) an amount determined by the Company’s board of directors. The shares of common stock underlying any awards that are , , held back upon exercise or settlement of an award to the exercise price or tax withholding, repurchased or are otherwise by the Company under the 2018 Plan will be added back to the shares of common stock available for issuance under the 2018 Plan. As of December 31, 2025 , 2,744,383 shares remained available for future grant under the 2018 Plan. The number of authorized shares reserved for issuance under the 2018 Plan was increased by 1,812,320 shares as of January 1, 2026 in accordance with the provisions of the 2018 Plan described above.
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Options and restricted stock units (“RSU”) granted under the Plans vest over periods determined by the board of directors. Options granted under the Plans expire no longer than ten years from the date of the grant. The exercise price for stock options granted is not less than the fair value of common shares based on quoted market prices. Certain of the Company’s RSUs are net settled by withholding shares of the Company’s Class A common stock to cover statutory income taxes.
Stock Option Valuation
The fair value of stock option grants with service-based or performance-based vesting conditions is estimated on the date of grant using the Black Scholes option pricing model. The volatility has been determined using the Company’s traded stock price to estimate expected volatility. The expected term of the Company’s stock options has been determined utilizing the “simplified” method for awards that qualify as “plain-vanilla” options. The risk-free interest rate is determined by reference to the U.S. Treasury yield curve in effect at the time of grant of the award for time periods approximately equal to the expected term of the award. Expected dividend yield is based on the fact that the Company has never paid cash dividends and does not expect to pay any cash dividends in the foreseeable future. The Company did not grant stock options in the years ended December 31, 2025 or 2024. The relevant data used to determine the fair value of the stock option grants during the year ended December 31, 2023 is as follows, presented on a weighted-average basis:
Year Ended
December 31, 2023
Risk-free interest rate
Expected volatility
Expected dividend yield
Expected term (in years)
The grant date fair value of stock options granted during the year ended December 31, 2023 was $ 7.57 per share.
Stock Option Activity
The following table summarizes the Company’s option activity since December 31, 2024:
Weighted
Weighted
Average
Average
Remaining
Aggregate
Exercise
Contractual
Intrinsic
Number of Shares
Price
Term
Value
(in years)
(in thousands)
Outstanding as of December 31, 2024
Granted
Exercised
Forfeited
Outstanding as of December 31, 2025
Vested and expected to vest as of
December 31, 2025
Options exercisable as of December 31, 2025
As of December 31, 2025, outstanding options of 1,042,634 were for the purchase of Class A common stock and outstanding options of 13,508 were for the purchase of either Class A common stock or Class B common stock.
The aggregate intrinsic value of stock options is calculated as the difference between the exercise price of the stock options and the fair value of the Company’s common stock for those stock options that had strike prices lower than the fair value of the Company’s common stock.
The aggregate intrinsic value of options exercised during the years ended December 31, 2025, 2024 and 2023 was $ 7.4 million, $ 5.3 million and $ 0.9 million, respectively.
Restricted Stock Units
The Company has granted RSUs with service-based vesting conditions and with both service-based and performance-based vesting conditions (“pRSU”). The fair value of RSU grants with service-based or with both service-based and performance-based vesting conditions is estimated on the date of grant using the market price of the underlying shares on the grant date.
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The following table summarizes the Company’s RSU with service-based vesting conditions activity since December 31, 2024:
Weighted Average
Number of Shares
Grant-Date Fair Value
Unvested balance December 31, 2024
Granted
Vested
Forfeited
Unvested balance December 31, 2025
The following table summarizes the Company’s pRSU activity since December 31, 2024:
Weighted Average
Number of Shares
Grant-Date Fair Value
Unvested balance December 31, 2024
Granted
Vested
Forfeited
Unvested balance December 31, 2025
pRSUs outstanding as of December 31, 2025 include 163,500 pRSUs granted in 2024 that are vesting over a four-year period based on continued service as the performance condition was met as of January 1, 2025. pRSUs outstanding as of December 31, 2025 also include 315,528 pRSUs granted in 2025. In the first quarter of 2025, the Company granted 347,840 pRSUs that will cumulatively vest over a four-year period based on continued service, commencing in the first quarter of 2026, based on achievement of a Company-specific performance target for the year ended December 31, 2025.
Additionally, during 2025, the Company granted 586,576 pRSUs that will vest based on the level of achievement of a Company-specific performance target for a 12-month period ending between December 31, 2027 and December 31, 2029, from a maximum of 100 % of the number of pRSUs granted to a minimum of 10 % of the pRSUs granted with no vesting if a minimum threshold of target performance is not achieved during the period (the “2027 pRSUs”). As of December 31, 2025, outstanding pRSUs include 489,173 2027 pRSUs.
Stock-Based Compensation
The Company recorded stock-based compensation expense in the following expense categories of its statements of operations and comprehensive income (loss) (in thousands):
Year Ended December 31,
Cost of revenue
Sales and marketing
Research and development
General and administrative
Restructuring and other charges
The Company recognized income tax benefits related to stock-based compensation expense of $ 5.6 million as a component in calculating its income tax benefit for the year ended December 31, 2025 . The Company did no t record income tax benefits related to stock-based compensation expense for the years ended December 31, 2024 and 2023 due to the full valuation allowance against deferred tax assets.
Stock-based compensation expense in the table above includes $ 5.3 million and $ 2.8 million of stock-based compensation for the years ended December 31, 2025 and 2024, respectively, related to pRSUs. As of December 31, 2025 , unrecognized compensation expense for RSUs, including pRSUs expected to vest, and option awards was $ 29.1 million, which is expected to be recognized over a weighted average period of 2.7 years.
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9. Income Taxes
The components of income (loss) before income taxes were as follows (in thousands):
Year Ended December 31,
Domestic
Foreign
The components of income taxes were as follows (in thousands):
Year Ended December 31,
Current income tax expense (benefit):
Federal
State
Foreign
Deferred income tax expense (benefit):
Federal
State
Foreign
Income tax expense (benefit)
The Company adopted ASU 2023-09 on a prospective basis beginning with the year ended December 31, 2025. The following table presents required disclosure pursuant to ASU 2023-09 and reconciles the U.S. federal statutory income tax rate to the Company's effective income tax rate for the year ended December 31, 2025 (dollar amounts in thousands):
Year Ended December 31, 2025
Federal statutory income tax rate
State and local income tax, net of federal
(national) income tax benefit(1)
Foreign tax effects
Tax credits
Research and development tax credit
Changes in valuation allowance
Nontaxable or nondeductible items
Stock-based compensation
Executive compensation limitation
Other nondeductible items
Effective income tax rate
(1) State taxes in Massachusetts made up the majority of the tax effect in this category and were comprised primarily of a benefit for research and development credits and a benefit related to the release of the valuation allowance.
The One Big Beautiful Bill Act (“OBBBA”) was signed into law on July 4, 2025, which, among other provisions, permanently repeals the requirement to capitalize domestic research expenditures for federal income tax purposes for taxable years beginning after December 31, 2024, and allows for the accelerated deduction of any remaining unamortized domestic research expenditures over one or two years. Foreign research expenditures are still required to be capitalized and amortized ratably over 15 years. The impacts of the OBBBA are reflected in the Company’s income tax benefit for the year ended December 31, 2025.
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The following table presents the required disclosures prior to the adoption of ASU 2023-09 and reconciles the U.S. federal statutory income tax rate to the Company’s effective income tax rate for the years ended December 31, 2024 and 2023:
Year Ended December 31,
Federal statutory income tax rate
State taxes, net of federal benefit
Federal and state research and development tax credits
Nondeductible items
Stock-based compensation
Other
Change in valuation allowance
Effective income tax rate
Net deferred tax assets as of December 31, 2025 and 2024 consisted of the following (in thousands):
December 31,
Deferred tax assets:
Net operating loss carryforwards
Capitalized research and development
Research and development tax credit carryforwards
Accrued expenses and other current liabilities
Property and equipment
Intangible assets
Stock-based compensation
Operating lease liability
Other
Total deferred tax assets
Valuation allowance
Net deferred tax assets
Deferred tax liabilities:
Capitalized software development costs
Property and equipment
Operating lease right of use asset
Intangible assets
Total deferred tax liabilities
Net deferred taxes
As of December 31, 2025, the Company had federal net operating loss carryforwards of $ 52.9 million to offset future taxable income, which do not expire but are limited in their usage to an annual deduction equal to 80 % of annual taxable income. As of December 31, 2025, the Company had state net operating loss carryforwards of $ 75.9 million, which may be available to offset future taxable income and expire at various dates beginning in 2027 . As of December 31, 2025, the Company also had federal and state research and development tax credit carryforwards of $ 11.0 million and $ 5.2 million, respectively, which may be available to reduce future tax liabilities and expire at various dates beginning in 2039 and 2032 , respectively.
Utilization of the U.S. federal and state net operating loss carryforwards and research and development tax credit carryforwards may be subject to a substantial annual limitation under Section 382 and Section 383 of the Internal Revenue Code ("IRC") of 1986, and corresponding provisions of state law, due to ownership changes that have occurred previously or that could occur in the future. The Company has completed analyses through December 31, 2024 and determined that the Company did not undergo an ownership change within the meaning of Sections 382 and 383 during the analysis periods. The Company does not believe an ownership change within the meaning of Sections 382 and 383 has occurred through December 31, 2025. Therefore, the Company does not believe that its operating losses and research and development tax credit carryforwards are limited or that any of its carryforwards would expire unused.
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The Company evaluates the positive and negative evidence bearing upon its ability to realize the deferred tax assets including its cumulative historical results and estimated future taxable income or loss. The Company had previously maintained a valuation allowance against its federal and state deferred tax assets as of December 31, 2024. During the fourth quarter of 2025, the Company concluded that, based on sustained improvements in the Company’s profitability, it is more likely than not that the Company will be able to fully realize its net deferred tax assets. The Company therefore released its valuation allowance of $ 48.5 million. The Company’s judgment regarding the likelihood of realization of these deferred tax assets could change in future periods, which could result in a material impact to the Company’s income tax provision in the period of change. The decrease in the valuation allowance for deferred tax assets during the year ended December 31, 2024 related primarily to the use of net operating loss carryforwards to offset taxable income, partially offset by an increase in capitalized research and development costs. The increase in the valuation allowance for deferred tax assets during the year ended December 31, 2023 related primarily to increases in net operating and capitalized research and development costs under IRC Section 174.
The changes in the valuation allowance were as follows (in thousands):
Year Ended December 31,
Valuation allowance as of beginning of year
Decreases recorded as a benefit to income tax provision
Increases recorded to tax provision
Valuation allowance as of end of year
The Company assesses the uncertainty in its income tax positions to determine whether a tax position of the Company is more likely than not to be sustained upon examination, including resolution of any related appeals of litigation processes, based on the technical merits of the position. For tax positions meeting the more-likely-than-not threshold, the tax amount recognized in the consolidated financial statements is reduced by the largest benefit that has a greater than fifty percent likelihood of being realized upon the ultimate settlement with the relevant taxing authority. No reserve for uncertain tax positions or related interest and penalties has been recorded at December 31, 2025 and 2024.
The Company files tax returns as prescribed by the tax laws of the jurisdictions in which it operates. In the normal course of business, the Company is subject to examination by federal, state and foreign jurisdictions, where applicable. In October 2024, the Company received notice of examination by the Internal Revenue Service for the year ending December 31, 2022. The examination was completed during the year ended December 31, 2025 with no adjustments proposed. The Company has not received notice of examination by any other jurisdictions for any other tax year open under statute. The Company is open to future tax examination under statute from 2022 to the present. However, carryforward attributes that were generated prior to January 1, 2022 may still be adjusted upon examination by federal, state or local tax authorities if they either have been or will be used in a future period.
The Company adopted ASU 2023-09 on a prospective basis beginning with the year ended December 31, 2025. The following table presents required disclosure pursuant to ASU 2023-09 regarding income taxes paid (net of refunds received) for the year ended December 31, 2025 (in thousands):
Year Ended December 31, 2025
Federal taxes
State taxes
California
Illinois
All other states
The following table presents the required disclosures prior to the adoption of ASU 2023-09 regarding income taxes paid for the years ended December 31, 2024 and 2023 (in thousands):
Year Ended December 31,
Cash paid for income taxes
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10. Leases
The Company leases office space under various non-cancelable operating leases. The Company's lease for office space for its former headquarters expired in September 2024. In April 2024, the Company entered into two agreements to lease office space in Cambridge, Massachusetts through December 2027 for fixed payments totaling $ 3.2 million through 2027, resulting in an increase to right-of-use assets and operating lease liabilities of $ 2.7 million.
In August 2024, the Company entered into an agreement to sublease office space in Belfast, Northern Ireland through July 2027 for fixed payments totaling approximately $ 1.6 million through 2027, resulting in an increase to right-of-use assets and operating lease liabilities of $ 1.3 million.
As of December 31, 2025 and 2024, the Company maintained security deposits of $ 0.3 million with the landlords of its leases, which amounts were included in prepaid expenses and other current assets and other assets on the Company’s consolidated balance sheet.
The components of lease cost under ASC 842 were as follows (in thousands):
Year Ended December 31,
Operating lease cost
Short-term lease cost
Variable lease cost
Supplemental disclosure of cash flow information related to leases was as follows (in thousands):
Year Ended December 31,
Cash paid for amounts included in the measurement
of operating lease liabilities
Operating lease liabilities arising from obtaining
right-of-use assets
The weighted-average remaining lease term and discount rate were as follows:
December 31,
Weighted-average remaining lease term - operating leases (in years)
Weighted-average discount rate - operating leases
Because the interest rate implicit in the lease was not readily determinable, the Company's incremental borrowing rate was used to calculate the present value of the leases. In determining its incremental borrowing rate, the Company considered its credit quality and assessed interest rates available in the market for similar borrowings, adjusted for the impact of collateral over the term of the lease.
Future annual lease payments under the Company’s leases as of December 31, 2025 were as follows (in thousands):
Years ending December 31,
Total future minimum lease payments
Less: imputed interest
Total operating lease liabilities
Total operating lease liabilities in the table above are classified on the consolidated balance sheet as follows (in thousands):
December 31, 2025
Current operating lease liabilities
Operating lease liabilities, net of current portion
Total operating lease liabilities
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11. Commitments and Contingencies
Leases
The Company's commitments under its leases are described in Note 10.
Indemnification Agreements
In the normal course of business, the Company may provide indemnification of varying scope and terms to third parties and enters into commitments and guarantees (“Agreements”) under which it may be required to make payments. The duration of these Agreements varies, and in certain cases, is indefinite. Furthermore, many of these Agreements do not limit the Company’s maximum potential payment exposure.
In addition, the Company has entered into indemnification agreements with members of its board of directors and executive officers that will require the Company, among other things, to indemnify them against certain liabilities that may arise by reason of their status or service as directors or officers.
Through December 31, 2025, the Company has not incurred any material costs as a result of such indemnifications. The Company does not believe that the outcome of any claims under indemnification arrangements will have a material effect on its financial position, results of operations or cash flows, and it has not accrued any liabilities related to such obligations in its consolidated financial statements as of December 31, 2025 and 2024.
Purchase Commitment
In June 2025, the Company entered into a five-year , $ 18.5 million purchase commitment, in the ordinary course of business, for advertising with specified annual minimum payment amounts through July 2029. The remaining purchase commitment as of December 31, 2025 was $ 15.5 million, of which $ 3.5 million relates to the next twelve months.
Legal Proceedings and Other Contingencies
The Company is from time to time subject to various legal proceedings and claims, either asserted or unasserted, which arise in the ordinary course of its business. While the outcome of these other claims cannot be predicted with certainty, management does not believe that the outcome of any of these other legal matters will have a material adverse effect on the Company’s consolidated results of operations or financial condition.
12. Retirement Plan
The Company has established a defined-contribution plan under Section 401(k) of the Internal Revenue Code (the “401(k) Plan”). The 401(k) Plan covers all employees who meet defined minimum age and service requirements, and allows participants to defer a portion of their annual compensation on a pre-tax basis. As currently established, the Company is not required to make any contributions to the 401(k) Plan. The Company contributed $ 1.7 million, $ 2.7 million and $ 0.9 million during the years ended December 31, 2025, 2024 and 2023 , respectively.
13. Related Party Transactions
The Company has, in the ordinary course of business, entered into arrangements with other companies who have shareholders in common with the Company. Pursuant to these arrangements, related-party affiliates receive payments for providing website visitor referrals. During the years ended December 31, 2025, 2024 and 2023, the Company recorded expense of $ 41.2 million, $ 14.5 million and $ 3.6 million, respectively, related to these arrangements. During the years ended December 31, 2025, 2024 and 2023 , the Company paid $ 40.0 million, $ 12.3 million and $ 4.0 million, respectively, related to these arrangements. As of December 31, 2025 and 2024, amounts due to related-party affiliates totaled $ 3.7 million and $ 2.5 million, respectively, which were included in accounts payable and accrued expenses on the balance sheets.
On August 11, 2025, the Company repurchased 900,000 shares of Class A common stock from Link Ventures, which is an entity affiliated with funds advised by David Blundin, the Company's chairman of the board of directors and co-founder, and other affiliated entities of Mr. Blundin, at a purchase price of $ 23.33 per share for an aggregate purchase price of $ 21.0 million pursuant to the provisions of the Company's share repurchase program. The purchase price represented an approximate 1.8 % discount to the closing price of the Company's common stock on August 8, 2025. The shares were immediately retired. In connection with the repurchase agreement, Mr. Blundin and Link Ventures entered into a 180 -day lock-up agreement with the Company which restricts the sale or transfer of any of the Company’s shares of capital stock beneficially owned by Mr. Blundin, subject to customary exceptions.
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14. Net Income (Loss) per Share
A reconciliation of the numerators and the denominators of the basic and dilutive net income (loss) per common share computations are as follows (in thousands):
Year Ended December 31,
Numerator:
Net income (loss)
Denominator:
Weighted average basic common shares
outstanding
Effect of dilutive securities:
Options to purchase common stock
Restricted stock units
Weighted average diluted common shares
outstanding
The Company excluded the following potential common shares, presented based on weighted average shares outstanding during the periods, from the computation of diluted net income (loss) per share because including them would have had an anti-dilutive effect (in thousands):
Year Ended December 31,
Options to purchase common stock
Restricted stock units
The tables above do not include performance-based awards for which the performance goal had not been met as of period end. As of December 31, 2025, the Company had 489,173 outstanding pRSUs for which the performance goal had not been met as of period end.
15. Restructuring and Other Charges
In June 2023, the Company committed to exiting its health insurance vertical to increase focus on core verticals and implemented a workforce reduction plan (the “Reduction Plan”) to improve operating efficiency. The Reduction Plan included the elimination of 175 employees, or approximately 28 %, of the Company’s workforce. During the year ended December 31, 2023, the Company incurred $ 4.0 million in severance charges in connection with the workforce reduction, consisting of cash expenditures for employee separation costs of $ 2.7 million that were paid in 2023 and 2024, and non-cash charges for the modification of certain equity awards of $ 1.3 million. During the year ended December 31, 2023, the Company recorded a credit of $ 0.2 million to restructuring and other charges in the accompanying consolidated statements of operations and comprehensive income (loss) related to estimated severance payments that were not made.
In August 2023, the Company sold assets related to its health insurance vertical comprised of all of the issued and outstanding membership interests of Eversurance LLC, a former subsidiary of the Company, to MyPlanAdvocate Insurance Solutions Inc. for cash consideration of $ 13.2 million. There were no employees of Eversurance LLC at the time of the sale. The assets sold consisted of commissions receivable of $ 30.8 million, which were expected to be collected over the next seven years, net intangible assets of $ 1.0 million and other net assets of $ 0.4 million, including the Company’s Evansville, Indiana office lease. The Company incurred $ 0.4 million of transaction costs in connection with the sale. Accordingly, the Company recognized a loss on sale of assets of $ 19.4 million during the year ended December 31, 2023, which amount is included in restructuring and other charges in the accompanying consolidated statements of operations and comprehensive income (loss). The Company also recorded an impairment charge on the right-of-use asset related to its Cambridge, Massachusetts office lease of $ 0.4 million during the year ended December 31, 2023 in connection with the Company entering into subleases with two third parties for a portion of the office space. The exit of the health insurance vertical and the Reduction Plan are referred to as the Company's restructuring, which was completed in 2023.
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16. Segments and Geographical Information
The Company's revenue is from customers in the United States. Long-lived tangible assets held outside of the United States are not material.
The Company manages its operations as a single segment for the purposes of assessing performance and making operating decisions. Operating segments are defined as components of an enterprise for which separate financial information is regularly evaluated by the Company’s chief operating decision maker, or decision-making group (the “CODM”), in deciding how to allocate resources and assess performance. The CODM of the Company is the Chief Executive Officer . The CODM assesses performance and allocates resources based on the Company’s consolidated statements of operations and comprehensive income (loss) and the Company’s operations are managed on a consolidated basis to decide where to allocate and invest additional resources within the business to continue growth. Segment asset information is not provided to the CODM to allocate resources.
As a single reportable segment entity, the Company’s segment performance measure is net income (loss), which is used to monitor budget versus actual results. Significant segment expenses, as provided to the CODM, are presented below (in thousands):
Year Ended December 31,
Revenue
Less:
Advertising expense
Cash operating expense (1)
Other segment items, net (2)
Net income (loss)
(1) Cash operating expense is primarily comprised of personnel-related costs, technology service costs, professional fees and office-related costs included in cost and operating expense in the Company's consolidated statements of operations and comprehensive income (loss) and does not include non-cash depreciation and amortization and stock-based compensation amounts that are included in cost and operating expenses or non-recurring legal settlement expense, restructuring and other charges, and acquisition-related costs that are also included in cost and operating expenses.
(2) Other segment items, net included within net income (loss) include stock-based compensation and depreciation and amortization amounts that are non-cash items included in cost and operating expenses, legal settlement expense, restructuring and other charges, and acquisition-related costs that are considered non-recurring operating expenses, as well as interest income and income taxes, which are included in net income (loss). These amounts are also reported within the consolidated statements of operations and comprehensive income (loss) and consolidated statements of cash flows. See the accompanying consolidated financial statements for financial information regarding other segment items, net and the Company’s operating segment.
17. Subsequent Events
From January 1, 2026 through February 5, 2026, the Company repurchased an additional 375,000 shares of its common stock at an average price of $ 23.24 per share, for an aggregate repurchase amount of $ 8.7 million.
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ITEM 9. CHANGES IN AND DISAGREEMENT S WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
None.
ITEM 9A. CO NTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
Our management, with the participation of our Chief Executive Officer and Chief Financial Officer (our principal executive officer and principal financial officer, respectively), evaluated the effectiveness of our disclosure controls and procedures as of December 31, 2025. The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.
Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and our management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Based on the evaluation of our disclosure controls and procedures as of December 31, 2025, our Chief Executive Officer and Chief Financial Officer concluded that, as of such date, our disclosure controls and procedures are effective at the reasonable assurance level.
Internal Control over Financial Reporting
Management’s Report on Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Our internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.
Our management has assessed the effectiveness of our internal control over financial reporting as of December 31, 2025. In making this assessment, management used the criteria described in Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) . Based on this assessment, our management has concluded that as of December 31, 2025, our internal control over financial reporting is effective, based on the specified criteria.
The effectiveness of our internal control over financial reporting as of December 31, 2025 has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report which is included herein.
Changes in Internal Control Over Financial Reporting
No changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) occurred during the three months ended December 31, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
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ITEM 9B. OTHER INFORMA TION
Rule 10b5-1 Trading Plans
The adoption or termination of contracts, instructions or written plans for the purchase or sale of our securities by our Section 16 officers and directors for the three months ended December 31, 2025, each of which is intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act (“Rule 10b5-1 Plan”), were as follows:
Name (Title)
Action Taken
(Date of Action)
Type of Trading Arrangement
Nature of Trading
Arrangement
Duration of Trading
Arrangement
Aggregate Number
of Securities
Joseph Sanborn
( Chief Financial Officer, Chief Administrative Officer, Treasurer & Secretary )
Adoption
( December 3, 2025 )
Rule 10b5-1 trading arrangement
Sale
Until August 10, 2026 , or such earlier date upon which all transactions are completed or expire without execution
Up to 40,000 shares
Jayme Mendal
( Chief Executive Officer and President )
Adoption
( December 4, 2025 )
Rule 10b5-1 trading arrangement
Sale
Until September 20, 2026 , or such earlier date upon which all transactions are completed or expire without execution
Up to 125,880 shares
ITEM 9C. DISCLOSURE REGARDING FOREIGN J URISDICTIONS THAT PREVENT INSPECTIONS
Not applicable.
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P ART III
ITEM 10. DIRECTORS, EXECUTIVE O FFICERS AND CORPORATE GOVERNANCE
The information required by this Item 10 will be included in our definitive proxy statement to be filed with the SEC with respect to our 2026 Annual Meeting of Stockholders and is incorporated herein by reference.
Our board of directors has adopted a Code of Business Conduct and Ethics applicable to all officers, directors and employees, including our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. A copy of the code is available at the Investors section of our website, located at investors.everquote.com, under “Corporate Governance—Governance Documents.” We intend to make all required disclosures regarding any amendments to, or waivers from, any provisions of the code at the same location of our website.
The Company has adopted an insider trading policy governing the purchase, sale and other dispositions of the Company’s securities (including gifts and adoption or amendment of Rule 10b5-1 trading plans) that applies to all Company personnel, including directors, officers, employees, and other covered persons. The policy also prohibits trading in securities of another company when an individual is aware of material non-public information about that company due to service as a covered person under the policy. Although its provisions do not apply to the Company generally, the policy provides that the Company’s policy is not to engage in transactions in Company securities while aware of material non-public information relating to the Company or its securities. The Company believes that its insider trading policy is reasonably designed to promote compliance with insider trading laws, rules and regulations, and listing standards applicable to the Company. A copy of the Company’s insider trading policy is filed as Exhibit 19.1 to our 2024 Annual Report on Form 10-K and incorporated by reference herein.
