Financial Data and Key Metrics Changes - The company reported total revenues of $1.6 billion for the third quarter, representing a growth of 35.4% year-over-year and 3.5% organic growth [6][15] - Adjusted EBITDA margin improved by 170 basis points to 36.6%, and adjusted earnings per share grew over 15% to $1.05 [6][16] - Contingent commissions increased by $46 million, with $12 million attributed to AssuredPartners [15] Business Line Data and Key Metrics Changes - The Retail segment achieved total revenue growth of 37.8%, with organic growth at 2.7% [16] - The Specialty Distribution segment grew total revenues by 30%, with organic growth of 4.6% [18] - The organic growth in Retail was impacted by approximately 1% due to adjustments related to employee benefits incentives [9][10] Market Data and Key Metrics Changes - Commercial insurance pricing remained stable, with rates for most lines similar to the second quarter [7][8] - Medical costs increased by 6%-8%, while pharmacy costs rose over 10% [7] - Rates in the admitted P&C markets were flat to up 5% compared to the prior year [8] Company Strategy and Development Direction - The company aims to enhance its solutions and value to customers through leadership changes and the integration of AssuredPartners [4][5] - The Board of Directors raised the dividend by 10% and expanded share repurchase authorization to $1.5 billion [5] - The company is focused on both organic and inorganic growth, with a strong pipeline for M&A activities [25] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about economic growth remaining stable, with a cautious bias among business leaders [7][23] - The company anticipates organic growth in the fourth quarter to be similar to the third quarter, influenced by employee benefits adjustments [16][21] - Management noted that the pricing environment for casualty and auto rates is expected to continue increasing [24] Other Important Information - The company generated $1 billion in cash flow from operations in the first nine months of 2025, a 24% increase compared to the same period in 2024 [20] - The effective tax rate for the quarter was 24.7%, remaining flat compared to the prior year [16] Q&A Session Summary Question: Relationship of organic growth to EBITDA margins - Management clarified that organic growth is just one component of margin drivers and should not be directly correlated [29][30] Question: Impact of government shutdown on business - Management acknowledged some businesses are impacted, particularly in specialty and retail segments, but expect revenue to catch up once the government reopens [31][32] Question: Retail organic growth impact - Management explained the 1% impact was due to adjustments in incentive commissions for employee benefits [35][36] Question: Future of admitted vs. E&S markets - Management indicated that while there may be some movement back to admitted markets, the E&S market continues to grow [42] Question: Expectations for property renewal rates - Management expects property renewal rates to remain similar, with potential for some markets to become more aggressive at year-end [53][54]

Financial Data and Key Metrics Changes - The company reported total revenues of $1.6 billion for Q3 2025, representing a growth of 35.4% year-over-year and 3.5% organic growth [6][15] - Adjusted EBITDA margin improved by 170 basis points to 36.6%, and adjusted earnings per share increased over 15% to $1.05 [6][16] - Contingent commissions grew by $46 million, with $12 million attributed to AssuredPartners [15] Business Line Data and Key Metrics Changes - The Retail segment achieved total revenue growth of 37.8%, with organic growth at 2.7% [16] - Specialty distribution reported total revenue growth of 30%, with organic growth of 4.6% [18] - The impact of employee benefits incentives adjustments affected organic growth in the Retail segment by approximately 1% [9][10] Market Data and Key Metrics Changes - Commercial insurance pricing remained stable, with rates for most lines similar to the previous quarter [7][22] - Medical costs increased by 6% to 8%, while pharmacy costs rose over 10% [8] - Workers' compensation rates were flat to down 3%, and casualty rates saw increases of 5% to 10% [8][9] Company Strategy and Development Direction - The company aims to enhance its solutions and value to customers through leadership changes and integration of AssuredPartners [4][5] - The M&A pipeline remains strong, with a focus on acquiring businesses that fit culturally and financially [24] - The company plans to maintain a disciplined capital deployment strategy to drive long-term shareholder value [24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in stable economic growth and a positive outlook for the insurance market [22][24] - There are expectations for continued upward pressure on casualty lines unless significant tort reform occurs [23] - The company anticipates organic growth rates for the specialty distribution segment could decline in the mid-single digits due to various pressures [19] Other Important Information - The Board of Directors raised the dividend by 10%, marking the 32nd consecutive year of increases [5] - The company expanded its share repurchase authorization to $1.5 billion [5] - Cash flow from operations for the first nine months of 2025 was $1 billion, a 24% increase compared to the same period in 2024 [19] Q&A Session Summary Question: Relationship of organic growth to EBITDA margins - Management clarified that organic growth is just one component of margin drivers and should not be directly correlated [27][29] Question: Impact of government shutdown on business - Management acknowledged some businesses are impacted, particularly in specialty and retail segments, but expect revenue to catch up over time [30][31] Question: Details on retail organic growth impact - The 1% impact was due to adjustments in employee benefits incentives, which are expected to continue affecting Q4 [33][34] Question: Outlook for admitted E&S market - Management indicated that while there is some movement back to admitted markets, the E&S market continues to grow [41] Question: Specialty distribution outlook for Q4 - Management expects a decline in organic growth for specialty distribution due to various pressures, including non-recurring revenue from the previous year [19][89]

Financial Performance - Total revenue reached $1606 million, a 354% increase compared to the previous year[13, 24] - Organic revenue grew by 35%[17, 24] - Adjusted EBITDAC margin increased by 170 basis points to 366%[17, 24] - Adjusted diluted net income per share increased by 154% to $105[17, 24] Segment Performance - Retail segment total revenues increased by 378% to $883 million, with organic revenue growth of 27%[26] - Specialty Distribution segment total revenues increased by 300% to $681 million, with organic revenue growth of 46%[32] Market Overview and Outlook - The company closed seven M&A transactions with approximately $17 billion of annual revenues[17, 19] - The company anticipates continued acquisitions during the remainder of the year and into 2026[37]

Core Insights - Brown & Brown (BRO) reported quarterly earnings of $1.05 per share, exceeding the Zacks Consensus Estimate of $0.90 per share, and showing an increase from $0.91 per share a year ago, resulting in an earnings surprise of +16.67% [1] - The company achieved revenues of $1.61 billion for the quarter ended September 2025, surpassing the Zacks Consensus Estimate by 6.61%, and up from $1.19 billion year-over-year [2] - Brown & Brown has outperformed consensus EPS estimates three times over the last four quarters and has topped revenue estimates four times in the same period [2] Financial Performance - The earnings surprise of +16.67% indicates strong performance relative to expectations, while the previous quarter also saw a positive surprise of +4.04% [1][2] - The current consensus EPS estimate for the upcoming quarter is $0.93, with projected revenues of $1.67 billion, and for the current fiscal year, the EPS estimate is $4.15 on revenues of $5.86 billion [7] Market Position - Brown & Brown shares have underperformed the market, losing about 13.7% since the beginning of the year, compared to the S&P 500's gain of 15.5% [3] - The Zacks Industry Rank places the Insurance - Brokerage sector in the top 33% of over 250 Zacks industries, indicating a favorable outlook for the industry [8] Future Outlook - The sustainability of the stock's price movement will depend on management's commentary during the earnings call and the trends in earnings estimate revisions [3][4] - The current Zacks Rank for Brown & Brown is 3 (Hold), suggesting that the shares are expected to perform in line with the market in the near future [6]

Financial Performance - Total revenues for Q3 2025 reached $1,606 million, a 35.3% increase from $1,186 million in Q3 2024[14] - Net income attributable to the Company for Q3 2025 was $227 million, compared to $234 million in Q3 2024, reflecting a decrease of 3%[14] - Comprehensive income attributable to the Company for Q3 2025 was $165 million, down from $406 million in Q3 2024, indicating a significant decline[17] - Net income for the nine months ended September 30, 2025, was $799 million, compared to $791 million for the same period in 2024, reflecting a growth of 1%[26] - Total revenues for the nine months ended September 30, 2025, were $4,295 million, a 19% increase from $3,622 million in the same period of 2024[41] - Total consolidated revenues for the three months ended September 30, 2025, were $1,606 million, an increase from $1,186 million in the same period of 2024, representing a growth of approximately 35.4%[94] - Total segment revenues for the nine months ended September 30, 2025, reached $4,295 million, compared to $3,731 million for the same period in 2024, indicating a year-over-year increase of about 15.1%[97] Assets and Liabilities - Total assets increased to $29,354 million as of September 30, 2025, compared to $17,612 million at December 31, 2024, representing a growth of 66.7%[20] - Current liabilities totaled $6,890 million as of September 30, 2025, compared to $6,314 million at December 31, 2024, an increase of 9.1%[20] - Long-term debt increased to $7,653 million as of September 30, 2025, compared to $3,599 million at December 31, 2024, reflecting a 112.5% increase[20] - The company’s total liabilities increased due to higher payments on acquisition earn-outs, totaling $77 million in 2025 compared to $100 million in 2024[26] - The estimated acquisition earn-out payables totaled $575 million, with $262 million recorded as accounts payable and $313 million as other non-current liabilities[69] Cash Flow and Investments - Cash flows from operating activities increased to $1,006 million in 2025 from $813 million in 2024, representing a growth of 23.8%[26] - The company reported a net cash used in investing activities of $7,701 million in 2025, significantly higher than $119 million in 2024, primarily due to payments for businesses acquired[26] - Cash dividends paid increased to $137 million in 2025 from $111 million in 2024, indicating a rise of 23.4%[26] - The total cash, cash equivalents, and restricted cash at the end of the period was $3,724 million, up from $2,701 million at the end of the previous year[26] - Significant non-cash investing activities included $699 million in other payables issued for agency acquisitions and purchased customer accounts during the nine months ended September 30, 2025[84] Revenue Segments - Retail segment revenues reached $883 million, while Specialty Distribution segment revenues were $681 million for the three months ended September 30, 2025[40] - Base commissions for the Retail segment increased to $623 million, up from $444 million in the same quarter of 2024, representing a 40% growth[40] - Profit-sharing contingent commissions for the Specialty Distribution segment were $55 million for the three months ended September 30, 2025, up from $19 million in the same period of 2024[40] - The U.S. market contributed $1,410 million in revenues for the three months ended September 30, 2025, compared to $1,031 million in 2024[42] - International operations generated total revenues of $196 million for the three months ended September 30, 2025, compared to $155 million in the same period of 2024, representing a growth of approximately 26.5%[91] Acquisitions - The company completed 37 acquisitions during the nine months ended September 30, 2025, including 13 insurance intermediaries and 16 insurance intermediaries' assets[51] - The total purchase price for the acquisition of Accession Risk Management Group was $9,598 million, funded by cash and common stock[54] - Total revenues from acquisitions completed through September 30, 2025, were $318 million, with income before income taxes of $34 million[66] - If the 2025 acquisitions had occurred at the beginning of 2024, total revenues for the nine months ended September 30, 2025, would have been $5,316 million, compared to $4,972 million in 2024[68] - As of September 30, 2025, the total balance of the escrow liability related to the Accession acquisition was $676 million, comprising $414 million in escrowed shares and $263 million in cash[59] Expenses - Employee compensation and benefits for Q3 2025 were $793 million, up from $607 million in Q3 2024, marking a rise of 30.6%[14] - Amortization expenses increased to $196 million in 2025 from $131 million in 2024, reflecting a rise of 49.6%[26] - Amortization expense for intangible assets is estimated to be $261 million for 2025, with a gradual increase to $446 million in 2026[72] - Operating lease cost for the three months ended September 30, 2025, was $19 million, slightly up from $18 million in the same period of 2024, reflecting a growth of about 5.6%[81] Compliance and Financial Ratios - The company was in compliance with all financial ratios and covenants as of September 30, 2025[76] - The maximum future acquisition contingency payments totaled $353 million as of September 30, 2025, excluding uncapped earn-out payables[69] - The one-month term SOFR Rate for loans was 4.263% as of September 30, 2025, reflecting the current interest environment[77] Stock and Dividends - The Company has an outstanding approval to purchase up to approximately $249 million of its common stock[115] - A quarterly cash dividend of $0.165 per share was approved on October 22, 2025, to be paid on November 12, 2025[119] - The maximum dividend payout that WNFIC can make in 2025 without prior approval is $9 million[111]

Core Insights - Brown & Brown reported better-than-expected revenue and earnings per share (EPS), primarily driven by acquisitions rather than organic growth [1] Group 1 - The company's performance exceeded market expectations in both revenue and EPS [1] - Acquisitions played a significant role in the company's growth, overshadowing organic growth metrics [1]

Financial Performance - Total revenues for Q3 2025 were $1.6 billion, an increase of 35.4% year-over-year[2] - Organic revenue growth for Q3 2025 was 3.5%, with commissions and fees increasing by 34.2%[2] - Diluted net income per share for Q3 2025 decreased to $0.68, a decline of 16.0% compared to the previous year, while adjusted diluted net income per share increased to $1.05, up 15.4%[2][8] - Income before income taxes for Q3 2025 was $311 million, down 1.9% from the prior year, with a margin decrease to 19.4%[2][10] - EBITDAC - Adjusted for Q3 2025 was $587 million, an increase of 41.8% year-over-year, with an adjusted margin of 36.6%[2][10] - For the nine months ended September 30, 2025, total revenues were $4.3 billion, an increase of 18.6% compared to the same period in 2024[3] - Net income attributable to the Company for Q3 2025 was $227 million, a decrease of $7 million or 3.0% year-over-year[2][14] - Net income before non-controlling interests for the nine months ended September 30, 2025, was $799 million, slightly up from $791 million in the same period of 2024[20] Cash Flow and Assets - Net cash provided by operating activities reached $1.006 billion for the nine months ended September 30, 2025, compared to $813 million in 2024, indicating a 23.8% increase[20] - Cash, cash equivalents, and restricted cash at the end of the period totaled $3.724 billion, up from $2.701 billion a year earlier, marking a 37.8% increase[20] - The company reported a significant increase in fiduciary cash, rising to $2.271 billion in 2025 from $1.827 billion in 2024, a growth of 24.3%[17] - Total assets increased to $29.354 billion as of September 30, 2025, compared to $17.612 billion on December 31, 2024, reflecting a growth of 67.5%[17] Debt and Equity - Long-term debt increased to $7.653 billion as of September 30, 2025, compared to $3.599 billion at the end of 2024, representing a 112.5% increase[17] - Total equity rose to $12.407 billion in 2025, up from $6.437 billion in 2024, reflecting a 92.5% increase[17] Acquisitions and Growth Strategy - The company made payments for businesses acquired totaling $7.659 billion in 2025, a significant increase from $118 million in 2024[20] - The company anticipates continued growth and expansion, focusing on strategic acquisitions and innovative insurance solutions[23] - The Company welcomed over 5,000 new teammates in Q3 2025, enhancing its global capabilities[4] Key Metrics and Definitions - Organic Revenue is a key performance indicator that excludes revenues from newly acquired operations, divested businesses, and foreign currency translation[27] - Diluted Net Income Per Share - Adjusted provides a meaningful representation of operating performance by excluding certain non-recurring items[26] - EBITDAC is defined as income before interest, taxes, depreciation, amortization, and changes in estimated acquisition earn-out payables[32] - EBITDAC Margin is calculated as EBITDAC divided by total revenues, providing insight into operating margins[32] - The company uses Organic Revenue growth, Diluted Net Income Per Share - Adjusted, and EBITDAC Margin - Adjusted as key metrics for executive compensation plans[26] Conference Call - The conference call to discuss Q3 2025 results is scheduled for October 28, 2025, at 8:00 AM (EDT)[21]

Core Viewpoint - The press release discusses various forward-looking statements regarding the company's future results and the potential impact of the acquisition of Accession, highlighting the uncertainties and risks involved in achieving anticipated benefits from the transaction [1][2] Group 1: Financial Performance and Expectations - The company is finalizing its financial results for the third quarter of 2025, which may differ from preliminary unaudited numbers [1] - There are expectations regarding potential future events that could materially affect actual results compared to those expressed in forward-looking statements [2] Group 2: Acquisition of Accession - The acquisition of Accession is expected to bring benefits, including cost savings, but there are risks that these benefits may not be realized as anticipated [1] - Financing the acquisition may lead to an increase in the company's indebtedness, which poses additional financial risks [1] Group 3: Operational Risks - The company faces various operational risks, including the inability to hire and retain qualified employees, cybersecurity threats, and challenges in integrating acquired businesses [1][2] - There are risks associated with international operations that may require more resources and management time to maintain profitability [1] Group 4: Market and Economic Conditions - The company is subject to fluctuations in commission revenue due to factors outside its control, including economic conditions and regulatory changes [2] - Disintermediation within the insurance industry and increased competition from technology and financial services companies are significant challenges [2] Group 5: Regulatory and Compliance Risks - The company must navigate changing regulations that could impact profitability and growth, including compliance costs and restrictions on products and services [2] - There is increasing scrutiny regarding environmental, social, and governance practices, which may affect the company's operations and reputation [2]

Core Insights - Brown & Brown, Inc. reported a revenue of $1.6 billion for Q3 2025, marking a 35.4% increase year-over-year, with commissions and fees rising by 34.2% and organic revenue growing by 3.5% [2][3] - The company's net income attributable to the Company was $227 million, a decrease of 3.0% compared to the previous year, while diluted net income per share fell to $0.68, down 16.0% [2][3] - For the nine months ending September 30, 2025, total revenues reached $4.3 billion, an 18.6% increase from the same period in 2024, with net income attributable to the Company increasing by 0.9% to $790 million [3][11] Financial Performance - Income before income taxes for Q3 2025 was $311 million, a slight decrease of 1.9% from the prior year, with the income before income taxes margin dropping to 19.4% from 26.7% [2][9] - EBITDAC - Adjusted for Q3 2025 was $587 million, reflecting a 41.8% increase year-over-year, with the EBITDAC margin - Adjusted rising to 36.6% from 34.9% [2][9] - For the nine-month period, EBITDAC - Adjusted was $1.6 billion, a 22.6% increase, with the EBITDAC margin - Adjusted improving to 37.1% from 35.9% [3][9] Operational Highlights - The company welcomed over 5,000 new employees in Q3 2025, enhancing its operational capabilities [4] - The increase in cash and cash equivalents was significant, with total current assets reaching $8.1 billion as of September 30, 2025, compared to $6.9 billion at the end of 2024 [13][14] - The company reported a total of $29 million and $42 million in interest income for Q3 and the nine months ended September 30, 2025, respectively, from its follow-on common stock offering and senior notes issuance [10] Market Position - Brown & Brown, Inc. operates as a leading insurance brokerage firm with a global presence across 700+ locations and a workforce of over 23,000 professionals [19] - The company continues to focus on delivering comprehensive and customized insurance solutions, indicating a strong commitment to growth and customer service [19]

Core Insights - Brown & Brown, Inc. has been Certified™ by Great Place to Work® for the seventh consecutive year, with its Canadian and U.K. teams receiving certification for the first time [1][2] - The company has also been recognized on the 2025 Fortune Best Workplaces for Women™ List for the fifth year, highlighting its commitment to fostering an inclusive workplace culture [1][2] Employee Experience - 92% of employees reported that Brown & Brown is a Great Place to Work, while 95% felt welcomed upon joining the company [2] - The Great Place To Work Certification is based on real-time employee feedback, emphasizing the importance of employee experience in achieving this recognition [3] Recognition and Awards - Earlier in 2025, Brown & Brown was included in Fortune's Best Workplaces in Financial Services & Insurance list [4] - The company received the 2024-2025 Platinum Level Bell Seal for Workplace Mental Health from Mental Health America for the third consecutive year [4] Company Overview - Brown & Brown, Inc. is a leading insurance brokerage firm with over 700 locations and a workforce of more than 23,000 professionals, providing customized insurance solutions since 1939 [5]