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Root Reports Q2 Revenue of $389.2M, Net Income Up 15% YoY

Reports Q2 revenue $389.2M, consensus $392.49M. Root said: "We're happy to report that in the second quarter we continued to generate impressive performance, delivering another strong quarter of profitability while continuing to invest in long-term growth. During the quarter, we: Delivered strong profitability, with net income increasing 15% year-over-year to $25 million generating approximately 31% annualized return on equity; Generated $389 million of revenue, up 2% year-over-year and $44 million of adjusted EBITDA, up 16% year-over-year; Ended the quarter with 484 thousand policies in force, up 6% year-over-year while gross written premium of $340 million and gross earned premium of $368 million were down 2% and 1% year-over-year, respectively, as we managed growth with discipline in a competitive Direct market; Launched in New Jersey, bringing Root to 37 states and more than 80% of the U.S. population; Announced our partnership with Jerry, an insurance shopping platform, further expanding Root's presence across high-intent digital marketplaces and demonstrating our ability to embed Root's technology and insurance experience inside partner ecosystems; Continued advancing our next-generation pricing model, expected to launch in the fourth quarter, which we believe will further improve segmentation, customer lifetime value, rate competitiveness, and long-term growth; Repurchased more than $20 million of shares under our $75 million share repurchase authorization. These results demonstrate the strength of the technology and data science capabilities we have built over the past decade. When we founded Root, our core belief was simple: insurance would ultimately be won through superior pricing and automation. Long before AI became a mainstream conversation, we built our company around machine learning, quantitative science, and a modern technology platform designed to automate insurance from end to end."

Root Forms Strategic Partnership with Jerry

Root announced a strategic partnership that embeds Root's data-driven car insurance experience directly into Jerry's app. The company said, "The partnership represents another milestone in Root's embedded insurance distribution strategy by bringing personalized pricing and a streamlined digital purchasing experience directly into Jerry's high-intent marketplace. By integrating into partner ecosystems where consumers are already shopping and making important financial and automotive decisions, Root is expanding access to its differentiated insurance offering while creating a more seamless experience for customers."

Root Partners with Hugo to Expand Full Coverage Insurance Options

Root announced a partnership with Hugo to expand access to full coverage car insurance options for drivers. Under the partnership, Root will serve as an expanded full coverage option for Hugo customers, integrating its personalized, usage-based insurance offering into Hugo's digital platform that lets users pay for liability insurance at their own pace. The collaborative service will be made available to eligible Hugo customers across the 16 states where Hugo currently operates.