What Management Said
Read the full Q2 2026 transcript ↗For more information regarding the use of non-GAAP financial measures, including reconciliations of these measures to the most recent comparable GAAP financial measures, we refer you to today's earnings release. We grew our corporate footprint to more than a dozen offices across the country. We grew adjusted EBITDA from under $40 million in 2022 to over $130 million in our last four quarters and expanded our margin meaningfully through the hardest product market in 50 years. We did all this while returning significant capital to our shareholders and maintaining a conservative balance sheet.
Total written premiums grew 14%, accelerating off the first quarter to $1.36 billion. Policies in force grew 15% year-over-year, and client retention, our most impactful driver of top and bottom line performance, improved to 86%, representing its highest level since the hard market began. Total revenues grew 21% to $113 million, with core revenues up 10% to $95 million over the prior year period. When adjusting for that year-over-year variance, core revenues grew 16% and total revenues grew 26% in the second quarter.
Adjusted EBITDA was $38 million, representing a 34% margin for the quarter. This powerful and durable income stream allows them to reinvest back into their businesses to further reinforce the growth flywheel. Our pathway to achieving that is fundamentally rooted in our highly differentiated human capital advantage. Our model, focused solely on personal lines and organic growth, is highly differentiated in insurance distribution, and our results compete with some of the most successful businesses in any sector.
What went well
- Goosehead delivered strong, broad-based second-quarter results with total revenues up 21% to $113.4 million and total written premiums up 14% (accelerating from 13% in Q1) to $1.36 billion, and raised its full-year revenue guidance.
- Adjusted EBITDA grew 30% to $37.9 million (a 33-34% margin) and net income nearly doubled to $17.0 million, with GAAP diluted EPS of $0.42 (up 106%) and adjusted EPS of $0.64.
- Client retention improved sequentially to 86%, its highest level since the hard market began, with management seeing no structural barrier to exceeding the prior 89% high.
- New business commissions grew 27% to $9.6 million (a second straight quarter above 20% growth) and new business royalties grew 20% to $9.4 million (fastest in six quarters), while franchise economics strengthened - average monthly franchise payments up over 35% to more than $28,000.
- Enterprise sales scaled rapidly, generating ~$3 million of new business commissions (up ~70%) and representing 21% of total new business commissions and agency fees, with the embedded Planet Home franchise ramping into the top 5% of franchises within six months.
- Contingent (ancillary) commissions surged 180% to $16.3 million on improved underwriting loss ratios, favorable carrier mix, and better-negotiated contracts, and the company launched Digital Agent 2.0, the U.S.'s first end-to-end choice shopping platform for personal lines.
What went wrong
- Client retention at 86% remains below the pre-hard-market high of 89%, and franchise producers grew only 5% year over year (2% sequentially) to 2,190, even as producer hires rose 30%.
- Management guided to moderate margin compression on a revenue-ex-contingent basis, with comp and G&A expected to grow high-teens to low-20% - ahead of core revenue growth - given the current investment cycle.
- Share repurchases slowed to just 95,000 shares ($3.9 million) in the quarter despite a lower stock price, and the quarter included a contract-termination charge tied to a service-technology system change.
- Pricing is now declining modestly (auto down mid-single-digits, home roughly flat to low-single-digit up), and the large 180% contingent-commission gain is an inherently variable revenue line.
Guidance Changes
| Metric | Period | Current guidance |
|---|---|---|
| Total revenue growth | FY2026 | Raised (midpoint ~15.5%), driven by higher contingent commissions |
| Core revenue growth | FY2026 | Second-half acceleration off the 12% delivered in H1 (retention + new business) |
| Contingent commissions | FY2026 | 70-100 bps of total written premium |
| Compensation & G&A growth | FY2026 | High-teens to low-20% (in excess of core revenue growth given growth investments) |
| Margin (ex-contingent) | FY2026 | Moderate compression from growth investments (underlying expense outlook unchanged) |
Performance Breakdown
| Metric | YoY | Note |
|---|---|---|
| Total revenues | +21% to $113.4M | Strong new business, improving retention and a 180% jump in contingent commissions; +26% adjusting for a $4M prior-year commission recovery. |
| Core revenues | +10% to $95.6M | New business and renewal growth; +16% adjusting for the prior-year $4M recovery. |
| Total written premiums | +14% to $1.36B | Accelerating from 13% in Q1 on policy-in-force growth and new business, partly offset by moderating pricing. |
| Adjusted EBITDA | +30% to $37.9M | Top-line growth and operating leverage; 33-34% margin. |
| Net income | $17.0M vs $8.3M | Revenue growth and margin expansion; GAAP diluted EPS $0.42 (up 106%), adjusted EPS $0.64, 15% net income margin. |
| New business commissions | +27% to $9.6M | Agent-management infrastructure, healthier product market, geographic expansion and enterprise sales; enterprise was 21% of new business commissions/fees. |
| Contingent commissions | +180% to $16.3M | Improved underwriting loss ratios, favorable carrier mix and optimized carrier relationships. |
Earnings Call Themes & Trends
| Topic | Previous mention | Current period | Trend |
|---|---|---|---|
| CEO succession | Mark Miller as CEO | Mark Miller to retire at year-end and remain a director; President/COO Mark Jones, Jr. (nearly 10 years at Goosehead) becomes CEO, with strategy unchanged and a focus on speed of execution, simplification and rapid decision-making; John Martin is the new CFO. | — |
| Franchise productivity flywheel | Agency staffing program (2023) | Franchise producers at a record ~2,200 (avg 2.4 per franchise), with multiple agencies over 40 producers (one over 50); same-store sales up 22% (top 50 up 40%) and ~70% more franchises exceeding $100K monthly new business commissions, as productivity rises non-linearly with producer count. | — |
| Enterprise sales and embedded franchises | Launched from scratch ~3 years ago | Growing ~70% and now ~1/3 the size of the 20-year-old corporate team; seeding corporate talent into embedded franchises (Planet Home) with natural lead flow, targeting adjacencies (85M mortgages, financial services, moving companies, Vivint) beyond the 4.5-5M annual home-closing pool. | — |
| Technology and AI (Digital Agent, Lily) | Building the choice shopping platform | Digital Agent 2.0 launched (optimizing the Texas conversion funnel before multi-state rollout), and AI service agent Lily handles ~20% of calls (reaching 30%) for administrative tasks, with cost savings reinvested while preserving the human-agent moat and client experience. | — |
| Improving but moderating product market | Hardest product market in 50 years | A more stable, opening market lifts retention, new business and commission rates, but pricing is now declining modestly (auto mid-single-digit, home flat/low-single-digit), narrowing the gap between PIF and premium growth as expected. | — |
| Capital allocation and long-term focus | Significant buybacks | Q2 buybacks slowed after heavy recent repurchases (3M+ shares since 2024); management/founder reaffirmed a conservative balance sheet, prioritizing operations first, and explicitly rejected a take-private, focusing on long-term shareholder value over short-term stock swings. | — |
Q&A Summary
Tommy McJoynt (KBW) asked about ex-contingent margin trajectory and whether comp/benefit changes at a large captive competitor are driving agent recruiting interest.
Martin said the underlying expense outlook is unchanged (moderate ex-contingent compression, comp/G&A up high-teens to low-20%); Jones Jr. said competitor disruption could be a producer-recruiting tailwind (more 'free agents') but does not change Goosehead's go-to-market strategy.
Andrew Andersen (Jefferies) asked what is driving the step-up in franchise productivity and where the 'speed of execution' focus can move fastest.
Jones Jr. cited the healthier product market, best-practice adoption, and launching high-quality corporate-trained owners into franchises (driving ~70% productivity improvement in the <1-year band; same-store sales +22%, top-50 +40%), and pointed to reducing complexity in underwriter count, service automation and national agent licensing.
Paul Newsome (Piper Sandler) asked about the sustainability of the surprising contingent commissions and the impact cadence of new agents.
Martin said nothing changed structurally - three drivers (new business growth, business profitability, better-negotiated contracts) have contingents tracking higher, though outcomes vary; Jones Jr. said new-agent ramp should look similar with incremental improvement from training tools and a more experienced hiring mix.
Brian Meredith (UBS) asked about the second-half comp ramp, retention durability and base commission rates.
Jones Jr. said the comp increase reflects new sales, technology and service investment (partly platform scalability rather than immediate new business), retention should keep improving with dedicated investment, and aggregate commission rates rose again on business mix (less E&S/statement plans) and carrier growth incentives.
Charlie Litterer (BMO) asked whether Digital Agent will contribute in H2, expansion beyond Texas, and premium-per-policy trends.
Jones Jr. said the focus is optimizing the Texas conversion funnel before rolling to more states and adding chat-like functionality (with the agent network a key moat), and that moderating pricing (per plan) is in line with expectations and contemplated in guidance.
Andrew Kligerman (TD Cowen) asked to quantify pricing declines by line and the embedded-agent mix, and whether franchise producer growth can accelerate.
Jones Jr. said auto pricing is down mid-single-digits and home is roughly flat (new-business pricing more durable than renewals), that 10+ corporate producers were placed into embedded franchises like Planet, and floated a '50 franchises with 50+ producers' ambition and a five-producers-per-franchise target as attainable.
Mark Hughes (Truist) asked how fast enterprise sales is growing and why franchise renewal retention looks a bit stronger than corporate.
Jones Jr. said enterprise (up ~70%) is the fastest-growing channel with a long runway into embedded client pools, and attributed the franchise-vs-corporate renewal gap to greater geographic diversity on the franchise side (corporate has larger Texas exposure) and franchisee incentives (50% renewal economics).
Ryan Tunis (Cantor) and Katie Sakys (Autonomous) asked about shareholder-value creation/take-private and the drivers of the full-year revenue-guide raise and higher G&A.
Jones Jr. and founder Mark Jones Sr. said the focus is maximizing long-term profit dollars (not short-term stock swings) with no interest in going private; Martin said the raise reflects contingent-commission outperformance (70-100 bps of TWP) with core-revenue expectations unchanged, and the G&A uptick reflects Digital Agent implementation and a ~$1.5M President's Club conference.
More on Goosehead Insurance, Inc.
Reported 2026-07-22 · figures from the Goosehead Insurance, Inc. Q2 2026 earnings call.
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