Financial Data and Key Metrics Changes - For the full year, the company grew revenue by 23%, with total revenues of $5.9 billion and adjusted earnings per share increasing over 10% to $4.26 [6][10] - In the fourth quarter, revenues reached $1.6 billion, growing 35.7%, while organic revenue decreased by 2.8% [9][10] - Adjusted EBITDAC margin remained flat at 32.9%, with EBITDAC growing by 35.6% [19][10] - Cash flow from operations increased by nearly 24% to approximately $1.5 billion, reflecting a strong operational performance [6][25] Business Line Data and Key Metrics Changes - The retail segment grew total revenues by 44.4%, primarily driven by acquisition activity, although EBITDAC margin decreased by 120 basis points to 26.6% [21][22] - Specialty distribution segment revenues grew by 27%, with EBITDAC margin decreasing by 60 basis points to 41.3% due to lower flood claims processing revenue [22][23] - Organic growth for the retail segment was 2.8% for the full year, while specialty distribution experienced a decline of 7.8% in the fourth quarter [15][16] Market Data and Key Metrics Changes - Commercial insurance pricing remained stable, with casualty rates increasing by 3-6% and admitted property rates moderating slightly [11][12] - The E&S property market saw rate changes similar to the previous quarter, generally down 15-30% [13] - Customers are managing their total insurance spend, leveraging lower rates to decrease deductibles or increase limits [14] Company Strategy and Development Direction - The company emphasizes competition and integrity, focusing on customer outcomes and maintaining a disciplined approach to capital allocation [7][8] - Integration efforts from the acquisition of Accession are progressing well, with expected EBITDA synergies of approximately $30 million-$40 million in 2026 [26][27] - The long-term margin target range has been increased to 32%-37%, reflecting a focus on balanced, profitable growth [31] Management's Comments on Operating Environment and Future Outlook - The management believes economic growth will remain stable, with a cautiously optimistic outlook from customers [10][32] - The company anticipates a modest negative impact on adjusted margins in Q1 due to the integration of Accession [26] - Pricing for admitted rates is expected to be similar to the fourth quarter, with casualty rates continuing to increase [32] Other Important Information - The company faced a challenge with approximately 275 former employees joining a competitor, taking with them $23 million in annual revenues [8][40] - The effective tax rate for the quarter was 21%, a decrease from the previous year's rate of 24.9% [19][20] Q&A Session Summary Question: Impact of former employees leaving for a competitor - Management stated that the compensation structure for producers remains unchanged and that the situation is unusual [40][41] Question: Shift of business from E&S to standard - Management noted that there is a trend of accounts moving back to standard markets, particularly in smaller accounts [45][46] Question: Deceleration in casualty pricing increases - Management indicated that the moderation in casualty pricing is a normal market trend and not indicative of a structural change [54][55] Question: Contingent commissions and accident years - Contingent commissions are generally calculated over a 12-month horizon, with some adjustments based on longer-term performance [68] Question: Future organic growth expectations - Management expects modest improvement in organic growth for the retail segment, while specialty distribution may face challenges in the first quarter [28][90]

Brown & Brown (NYSE:BRO) Q4 2025 Earnings call January 27, 2026 08:00 AM ET Speaker1Good morning, and welcome to the Brown & Brown, Inc. fourth quarter earnings call. Today's call is being recorded. Please note that certain information discussed during this call, including information contained in the slide presentation posted in connection with this call, and including answers given in response to your questions, may relate to future results and events or otherwise be forward-looking in nature. Such statem ...

© 2026 Brown & Brown, Inc. All rights reserved. 1 Information Regarding Non-GAAP Measures This presentation contains references to "non-GAAP financial measures" as defined in SEC Regulation G, consisting of Organic Revenue, EBITDAC, EBITDAC Margin, EBITDAC - Adjusted, EBITDAC Margin - Adjusted, Income Before Income Taxes - Adjusted, Income Before Income Taxes Margin - Adjusted, Net Income Attributable To The Company - Adjusted and Diluted Net Income Per Share - Adjusted. We present these measures because we ...

Core Insights - Brown & Brown (BRO) reported a revenue of $1.61 billion for the quarter ended December 2025, reflecting a year-over-year increase of 35.7% [1] - The earnings per share (EPS) for the quarter was $0.93, up from $0.86 in the same quarter last year, with an EPS surprise of +2.53% compared to the consensus estimate of $0.91 [1] Financial Performance - The reported revenue was a slight miss, with a surprise of -2.16% against the Zacks Consensus Estimate of $1.64 billion [1] - Total organic growth was reported at -2.8%, which was below the five-analyst average estimate of -0.7% [4] - Commissions and fees totaled $1.58 billion, which was below the six-analyst average estimate of $1.62 billion, but represented a year-over-year increase of 36.1% [4] - Retail commissions and fees were reported at $911 million, compared to the average estimate of $935.63 million [4] - Total revenues from retail were $920 million, exceeding the estimated $965.15 million, marking a year-over-year increase of 44.7% [4] - Specialty distribution revenues were reported at $678 million, slightly below the average estimate of $684.38 million [4] Income Metrics - Income before income taxes for retail was $131 million, lower than the average estimate of $165.67 million [4] - Income before income taxes for other segments was reported at -$21 million, significantly better than the average estimate of -$106.77 million [4] - Specialty distribution income before income taxes was $211 million, compared to the average estimate of $233.13 million [4] Stock Performance - Over the past month, shares of Brown & Brown have returned -2%, while the Zacks S&P 500 composite saw a +0.2% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the broader market in the near term [3]

分组1 - Brown & Brown reported quarterly earnings of $0.93 per share, exceeding the Zacks Consensus Estimate of $0.91 per share, and up from $0.86 per share a year ago, representing an earnings surprise of +2.53% [1] - The company posted revenues of $1.61 billion for the quarter ended December 2025, which missed the Zacks Consensus Estimate by 2.16%, compared to year-ago revenues of $1.18 billion [2] - Over the last four quarters, Brown & Brown has surpassed consensus EPS estimates three times and topped consensus revenue estimates three times as well [2] 分组2 - The current consensus EPS estimate for the coming quarter is $1.42 on revenues of $1.86 billion, and for the current fiscal year, it is $4.66 on revenues of $7.05 billion [7] - The Zacks Industry Rank for Insurance - Brokerage is currently in the bottom 19% of over 250 Zacks industries, indicating potential challenges for the sector [8] - The estimate revisions trend for Brown & Brown was mixed ahead of the earnings release, resulting in a Zacks Rank 3 (Hold) for the stock, suggesting it is expected to perform in line with the market in the near future [6]

Brown & Brown reported a rise in fourth-quarter adjusted profit on Monday, as the insurance broker benefited from higher income from commissions and fees on the back of strong demand. ...

Financial Performance - Total revenues for Q4 2025 reached $1.6 billion, an increase of 35.7% year-over-year, while organic revenue decreased by 2.8%[2] - Net income attributable to the Company for Q4 2025 was $264 million, a 25.7% increase compared to the same quarter last year[2] - Diluted net income per share for Q4 2025 was $0.59, a decrease of 19.2%, while adjusted diluted net income per share increased to $0.93, an 8.1% rise[2] - For the full year 2025, total revenues were $5.9 billion, up 22.8% from 2024, with organic revenue growth of 2.8%[2] - Income before income taxes for Q4 2025 was $321 million, a 16.7% increase, with a margin of 20.0% compared to 23.2% in Q4 2024[2] - EBITDAC - Adjusted for Q4 2025 was $529 million, a 35.6% increase, with an adjusted margin of 32.9%[2] Assets and Liabilities - Total assets increased to $29,991 million in 2025, up from $17,612 million in 2024, representing a growth of 70.0%[15] - Total current liabilities increased to $8,294 million in 2025 from $6,314 million in 2024, a rise of 31.4%[15] - Goodwill increased significantly to $15,087 million in 2025, compared to $7,970 million in 2024, indicating a growth of 89.5%[15] - The total equity of the company rose to $12,573 million in 2025, up from $6,437 million in 2024, reflecting a growth of 95.5%[15] Cash Flow - Net cash provided by operating activities rose to $1,450 million in 2025, up from $1,174 million in 2024, marking a growth of 23.5%[18] - Cash, cash equivalents, and restricted cash at the end of 2025 totaled $3,815 million, an increase from $2,502 million at the end of 2024, representing a growth of 52.5%[18] Acquisitions and Investments - The Company completed the acquisition of Accession in 2025, contributing to strong revenue growth and margin expansion[2] - Payments for businesses acquired in 2025 amounted to $7,854 million, a substantial increase from $890 million in 2024[18] - The company issued common stock, generating proceeds of $4,315 million in 2025, compared to no proceeds in 2024[18] Employee Compensation - Employee compensation and benefits for Q4 2025 totaled $819 million, an increase from $582 million in Q4 2024[12] - Interest expenses for Q4 2025 were $100 million, compared to $46 million in Q4 2024[12] - The Company reported a total of 339 million diluted shares outstanding for Q4 2025, compared to 284 million in Q4 2024[12] Strategic Focus - The company anticipates continued growth and expansion, focusing on strategic acquisitions and innovative solutions in the insurance brokerage sector[21] - The company emphasizes the importance of Organic Revenue and Organic Revenue growth as key indicators for assessing performance on a consolidated basis and across segments[24] Definitions and Metrics - Organic Revenue is defined as core commissions and fees, excluding contributions from newly acquired operations, divested businesses, and foreign currency translation[25] - EBITDAC is defined as income before interest, income taxes, depreciation, amortization, and changes in estimated acquisition earn-out payables[30] - EBITDAC Margin is calculated as EBITDAC divided by total revenues, providing insight into operating margins[30] - Diluted Net Income Per Share - Adjusted excludes the after-tax impact of various non-recurring items, enhancing comparability of results[30] - The company uses Organic Revenue growth, Diluted Net Income Per Share - Adjusted, and EBITDAC Margin - Adjusted as key performance metrics for incentive compensation plans[24] - The impact of foreign currency translation is calculated by applying current-year exchange rates to prior year functional currencies, affecting revenue comparisons[30] - Acquisition/Integration Costs include expenses related to regulatory filings, professional services, and integration processes, which are not part of ongoing operations[30] - The company provides non-GAAP financial measures to offer additional insights into operating performance that may not be apparent under GAAP[24] - Comparability of non-GAAP measures may be limited as industry peers may use different terminology and adjustments[29]

Core Insights - Brown & Brown, Inc. reported strong financial results for the fourth quarter and full year of 2025, highlighted by significant revenue growth and the acquisition of Accession [1][3] Financial Performance - For Q4 2025, total revenues reached $1.6 billion, an increase of $423 million or 35.7% compared to Q4 2024, while organic revenue decreased by 2.8% [3] - For the full year 2025, total revenues were $5.9 billion, up $1.1 billion or 22.8% from 2024, with organic revenue increasing by 2.8% [3] - Net income attributable to the Company for Q4 2025 was $264 million, a rise of $54 million or 25.7% year-over-year [3] - Diluted net income per share for Q4 2025 was $0.59, down 19.2%, while adjusted diluted net income per share increased to $0.93, up 8.1% [3][4] Margins and Income - Income before income taxes for Q4 2025 was $321 million, a 16.7% increase, with an income before income taxes margin of 20.0%, down from 23.2% in Q4 2024 [3][6] - EBITDAC - Adjusted for Q4 2025 was $529 million, a 35.6% increase, with an EBITDAC margin - Adjusted of 32.9% [3][6] Acquisitions and Growth - The acquisition of Accession contributed to the overall growth and was a key highlight for the year [1] - The Company experienced strong revenue growth and double-digit adjusted diluted net income per share growth, alongside good adjusted margin expansion [1] Balance Sheet and Cash Flow - As of December 31, 2025, total assets were $29.99 billion, significantly up from $17.61 billion in 2024 [11] - Cash and cash equivalents increased to $1.08 billion from $675 million in 2024 [11] - Net cash provided by operating activities for the year was $1.45 billion, compared to $1.17 billion in 2024 [12]

Core Insights - Brown & Brown, Inc. reported strong financial performance for the fourth quarter and full year of 2025, highlighted by significant revenue growth and successful acquisitions [1][3] Financial Performance - Total revenues for Q4 2025 reached $1.6 billion, an increase of $423 million or 35.7% compared to Q4 2024, while organic revenue decreased by 2.8% [3][9] - For the full year 2025, total revenues amounted to $5.9 billion, up $1.1 billion or 22.8% from 2024, with organic revenue growth of 2.8% [3][9] - Net income attributable to the company for Q4 2025 was $264 million, a rise of $54 million or 25.7% year-over-year, while diluted net income per share decreased by 19.2% to $0.59 [3][9] - For the full year, net income attributable to the company was $1.1 billion, an increase of $61 million or 6.1% compared to 2024, with diluted net income per share at $3.16, down 8.7% [3][9] Margins and Adjusted Metrics - Income before income taxes for Q4 2025 was $321 million, up 16.7%, with a margin of 20.0%, down from 23.2% in Q4 2024 [3][6] - EBITDAC - Adjusted for Q4 2025 was $529 million, a 35.6% increase, with an EBITDAC margin of 32.9%, consistent with the previous year [3][6] - For the full year, EBITDAC - Adjusted was $2.1 billion, a 25.6% increase, with an EBITDAC margin rising to 35.9% from 35.2% in 2024 [3][6] Acquisitions and Growth Strategy - The acquisition of Accession was a key highlight for 2025, contributing to the company's strong revenue growth and strategic positioning [1][3] - The company emphasized the importance of organic revenue growth as a measure of ongoing performance, which allows for a clearer comparison of revenue sources [20][21] Balance Sheet and Cash Flow - As of December 31, 2025, total assets were reported at $29.99 billion, significantly up from $17.61 billion in 2024, reflecting the impact of acquisitions [11][12] - Cash and cash equivalents increased to $1.08 billion from $675 million in 2024, indicating improved liquidity [11][12] - Net cash provided by operating activities for the year was $1.45 billion, compared to $1.17 billion in 2024, showcasing strong operational cash flow [12][13]

Core Insights - The company reported strong financial performance for the third quarter, with total revenues of $1.606 billion, representing a 35.4% increase compared to the same period last year [19] - The adjusted EBITDAC margin improved to 36.6%, up 170 basis points year-over-year, driven by strong underlying margin expansion and increased contingent commissions [19] - The company completed seven acquisitions during the quarter, contributing to significant revenue growth, with the largest acquisition being Accession, which had total revenue of approximately $285 million for the stub period [8][16] Financial Performance - Total revenues for the third quarter reached $1.606 billion, a 35.4% increase year-over-year, with organic growth of 3.5% [8][19] - Adjusted earnings per share grew over 15% to $1.05, while diluted net income per share increased by 15.4% [20] - The company generated $1 billion in cash flow from operations for the first nine months of 2025, a 24% increase compared to the same period in 2024 [24] Segment Performance - The Retail segment achieved total revenue growth of 37.8%, with organic growth of 2.7%, impacted by adjustments related to employee benefits incentives [20] - The Specialty Distribution segment grew total revenues by 30%, with organic growth of 4.6%, driven by the acquisition of Accession and strong brokerage performance [22] - The EBITDAC margin for the Retail segment increased by 150 basis points to 28%, while the Specialty Distribution segment's margin decreased by 110 basis points to 43.9% due to the lower margin of Accession [21][22] Market and Economic Outlook - Economic growth is expected to remain stable, with no significant disruptors anticipated to affect admitted rates [28][29] - The company noted that casualty and auto rates are expected to continue increasing, while admitted property rates will remain competitively priced [29] - The M&A pipeline appears strong, with ongoing efforts to acquire businesses that align culturally and financially [30][31] Strategic Initiatives - The company announced a 10% increase in dividends, marking the 32nd consecutive year of dividend growth [6] - Share repurchase authorization was expanded to $1.5 billion, aimed at managing dilution and driving earnings per share growth [7] - The integration of Accession is progressing well, with expectations for synergies to be realized over a three-year period [70][71]