Summary of Verisk Analytics Conference Call Company Overview - **Company**: Verisk Analytics (NasdaqGS: VRSK) - **Event**: Ultimate Services Investor Conference - **Date**: November 18, 2025 Key Points Industry and Business Focus - Verisk operates in the information services industry, specifically focusing on underwriting solutions and analytics for the insurance sector [2][6][9] Core Lines Reimagined Initiative - The Core Lines Reimagined initiative is a significant investment aimed at overhauling Verisk's core ISO forms and loss cost business, with a focus on enhancing customer experience through digital platforms [8][9] - The initiative is nearing completion, with more digital content and analytics being integrated into the platform [10][11] - Over 50% of customers are already using the new platform, leading to 2-3 times more engagement with digitized content [14][15] Revenue Growth and Pricing Strategy - The adoption of new modules and improved analytics is expected to drive higher value realization and better price realization for Verisk [11][21] - The company aims to maintain or potentially increase price realization compared to historical levels due to the enhanced value provided by Core Lines Reimagined [22][24] AI Integration and Competitive Landscape - Verisk is leveraging AI to enhance its product offerings, including the introduction of Gen AI layers to improve customer interaction with data [15][25] - The company acknowledges the emergence of AI-enabled competitors but believes its proprietary data and analytics provide a competitive edge [25][29] Challenges and Market Dynamics - Current headwinds include a reduction in government contract spending and competitive pressure in the personal lines auto business [36][38] - The auto insurance segment is facing growth headwinds due to increased competition and market dynamics, with Verisk being a Challenger brand [39][41] Future Outlook - Verisk plans to continue innovating and enhancing its product offerings to meet customer demands for efficiency and automation in underwriting [51] - The company is open to M&A opportunities that align with its strategy to enhance service offerings and efficiency in the industry [61][62] Transition to New Platform - Verisk does not plan a forced transition to the new platform but expects a gradual migration over the next 12 to 18 months as all content is integrated [63][65] Additional Insights - The company emphasizes the importance of customer feedback in shaping its product development and service offerings [9][18] - Verisk's strategy includes building consortium databases to aggregate data sets and create value for customers, particularly in the excess and surplus insurance market [18][20] This summary captures the essential insights from the Verisk Analytics conference call, highlighting the company's strategic initiatives, market challenges, and future outlook.

Financial Data and Key Metrics Changes - In Q3 2025, consolidated revenue was $768 million, reflecting a 5.9% increase year-over-year, with net income rising 2.5% to $226 million and diluted GAAP EPS increasing by 5% to $1.61 [18][19] - Organic constant currency (OCC) revenue growth was 5.5%, with subscription revenue growth at 8.7%, while transactional revenue declined by 8.8% due to low severe weather activity [6][7][19] - Year-to-date performance showed 7.1% OCC revenue growth and 9.4% OCC adjusted EBITDA growth, with an adjusted EBITDA margin of 56.3% [7][19] Business Line Data and Key Metrics Changes - Subscription revenues, comprising 84% of total revenue, grew 8.7% on an OCC basis, driven by strong performance across various subscription-based solutions [21] - Transactional revenues, making up 16% of total revenues, declined 8.8% on an OCC basis, primarily due to lower transactional volumes in property estimating solutions [23][24] Market Data and Key Metrics Changes - The third quarter experienced a historically low level of weather activity, with weather events declining 18% year-over-year and 31% below the five-year average, impacting claims volumes significantly [24] - The company noted that 2025 is on track to be the first year since 2015 without a named U.S. hurricane making landfall [24] Company Strategy and Development Direction - The company is focused on enhancing AI capabilities and integrating them into client solutions, with strong client interest in AI enhancements [10][11][12] - Strategic engagement with clients is leading to increased data contributions and pipeline opportunities, with 2025 expected to be the strongest sales year yet [9][16] - The company is committed to investing in integrations and innovations to deliver value to clients, particularly in the areas of anti-fraud and extreme event solutions [9][14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to deliver results in line with long-term targets despite temporary factors impacting growth [20] - The company anticipates continued strong subscription growth and sees opportunities for pricing adjustments based on enhanced value delivery through AI and data integration [45][46] - The pending acquisition of AccuLynx has faced delays due to FTC review, with no material benefits expected in 2025 [17][30] Other Important Information - The company paid a cash dividend of $0.45 per share, a 15% increase from the prior year, and repurchased $100 million of common stock [29][30] - Adjusted net income increased by 1% to $241 million, with diluted adjusted EPS rising by 3% to $1.72 for the quarter [29] Q&A Session Summary Question: Update on the AccuLynx deal and its implications - Management is working collaboratively with the FTC for approval and believes in the strategic merits of the deal despite the delay [36] Question: Competitive landscape regarding AI startups - The company sees many AI startups but believes its proprietary data and industry expertise provide a strong competitive advantage [39][40] Question: Future pricing opportunities amid decelerating net written premiums - Management sees real opportunities for pricing adjustments based on the value delivered through AI enhancements and data integration [44][46] Question: Impact of auto underwriting market dynamics - The auto underwriting business is not directly linked to premium growth, and the company continues to focus on product differentiation and client feedback [50][52] Question: Clarification on guidance reduction due to AccuLynx - Management did not break down the guidance changes but indicated that the removal of AccuLynx's impact was a factor [56] Question: Expectations for free cash flow growth - Free cash flow growth is expected to continue in line with EBITDA growth, driven by improved collections and lower cash taxes [65] Question: Competitive pressures in the auto market - The company is focusing on product differentiation and leveraging deeper data sets to maintain or expand market share [69][70] Question: Industry premium growth expectations - The industry is expected to normalize to mid-single digits in 2025, with the company focusing on value delivery rather than solely on premium growth [73][76]