Verisk(US:VRSK)2026-02-18 12:18Business Operations - Verisk completed the sale of its Energy business on February 1, 2023[17]. - The marketing solutions business was sold for a net cash price of $80 million to ActiveProspect, Inc. on December 31, 2025[50]. - The company has acquired 10 businesses since 2022, allowing entry into new markets and enhancement of existing services with proprietary data sources[72]. - The company acquired 6 businesses since January 1, 2023, impacting the comparability of consolidated results[209]. - The acquisition of SuranceBay, LLC for $163.1 million aims to streamline insurance processes and enhance workflows in the life and annuity industry[210]. - The acquisition of Simplitium Limited for $19.7 million provides access to over 300 third-party models, enhancing data and technology tools for insurers[211]. - The sale of the Energy business for $3,066.4 million resulted in a loss of $131.1 million and was classified as discontinued operations[214][215]. Financial Performance - Revenues for the year ended December 31, 2025, were $3,072.7 million, an increase of $191.0 million or 6.6% compared to $2,881.7 million in 2024[216]. - Underwriting revenue increased by $155.6 million or 7.7%, while claims revenue increased by $35.4 million or 4.1%[216]. - Approximately 70% of the company's revenue for the year ended December 31, 2025, was derived from solutions provided to U.S. P&C primary insurers[115]. - EBITDA for the year ended December 31, 2025, is a critical measure of performance, with the company focusing on balancing revenue growth with cost management[192][194]. - The company reported year-over-year revenue growth as a key performance metric, driven by increased sales to existing and new customers, as well as strategic acquisitions[191]. Client and Market Engagement - In 2025, Verisk's clients included all of the top 100 property and casualty insurance providers in the U.S.[18]. - Over 80% of Verisk's revenues in 2025 were generated from annual subscriptions or long-term agreements[24]. - The company segments its client base into three tiers: Tier One for significant customers, Tier Two for large and middle-market clients, and Tier Three for smaller specialized companies[76]. - The company’s client strategy emphasizes a structured, multi-tiered sales approach, enhancing customer engagement and satisfaction through specialized teams[74]. Data and Technology - Verisk maintains an underwriting database of more than 38.9 billion statistical records, including approximately 10.2 billion commercial lines records and 28.7 billion personal lines records[33]. - The company processes approximately 2,000 regulatory filings each year to ensure compliance with legal and regulatory requirements[27]. - The claims database analyzes over 1.9 billion claim records, making it the world's largest database for P&C claims information, supporting fraud detection and compliance reporting[59]. - The company provides a patented plan-sketching program that assists in estimating repair costs, improving accuracy in claims processing[54]. - The company’s anti-fraud solutions predict the likelihood of fraud and detect suspicious activity, enhancing profitability for clients[58]. - The company’s casualty solutions focus on compliance and workflow automation, leveraging AI for efficient claims processing and decision support[63]. - The company has developed catastrophe models for hurricanes, earthquakes, and other events in over 120 countries[43]. Employee Engagement and Workforce - The company employs approximately 8,000 employees globally, with 57% based in the U.S., and has a good relationship with its workforce, experiencing no significant labor disputes[86][87]. - The employee engagement score for 2025 is 80%, improving by 2 percentage points since 2024, and the company has been recognized as a Great Place to Work for ten consecutive years[98]. - The company offers competitive salaries and benefits, including a 401(k) program with a 100% company match up to 6%[95]. Compliance and Risk Management - The company is licensed as a rating and advisory organization under state insurance codes in all 50 states, providing statistical and actuarial services to P&C insurers[103]. - The company faces potential litigation related to intellectual property infringement, which could restrict its ability to use and provide technologies[142]. - Legal and regulatory risks, including data privacy laws, could adversely affect the company’s ability to conduct business and its financial position[138]. - Compliance with evolving procurement laws and regulations is critical, as violations could harm the company’s reputation and result in penalties[145]. - The company relies on external data sources, and loss of access to these sources could adversely affect its ability to provide solutions[109]. Market Challenges - The company faces a long selling cycle for new contracts, which incurs significant business development expenses without guaranteed revenue[114]. - The demand for the company's solutions may decrease due to the increasing availability of free or inexpensive public information[111]. - The company is subject to competition in various markets, which may hinder its ability to maintain a competitive position[108]. - A downturn in the U.S. insurance industry could lead to a decline in revenues, significantly impacting the company's financial results[115]. - Cybersecurity breaches could harm the company's reputation and result in loss of customers[126]. - Changes in tax laws or audits could materially impact the company's effective tax rate and financial position[124]. Strategic Initiatives - The Reimagine program includes significant enhancements to existing solutions and new digital workflow tools[36]. - The company plans to invest in new solutions and businesses, which may offset margin expansion despite historical improvements in EBITDA margin[199]. - The company has substantially completed the implementation of a new Enterprise Resource Planning (ERP) system, which is critical for managing business operations[155]. - Any disruptions in the ERP system's design or implementation could adversely affect the company's operations and financial condition[156]. Shareholder Information - As of December 31, 2025, the ten largest shareholders owned 39.3% of the company's common stock, which could lead to stock price declines if substantial sales occur[157]. - Approximately 137,941,888 shares of common stock were outstanding as of February 13, 2026, under equity incentive plans, which may affect stock price due to potential future issuances[158]. - The company has paid cash dividends of $251.1 million and $221.3 million during the years ended December 31, 2025, and 2024, respectively[181]. - The company has a publicly announced share repurchase plan and has repurchased a total of 92,798,595 shares since its IPO through December 31, 2025[181]. - As of December 31, 2025, the company had $967.5 million available for share repurchases under its authorization, with a total of 1,022,624 shares repurchased in Q4 2025 at an average price of $218.99 per share[186].