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What were the key takeaways from Root's earnings call?

- **Record Q3 growth**: Policies in force and revenue up, 20% LTV improvement from new algo. 
- **Partnership dominance**: 50% of partnerships in IIA channel, 3x YoY growth. 
- **$5M Q4 marketing boost**, 3-5pt Q4 loss ratio rise expected. 
- **No tariff impact**, competitive direct channel growth sustained.

**【Management Opening Remarks】**
- CEO Alex Timm highlighted Q3 as a record quarter with policies in force and revenue growth, driven by pricing algorithm innovations and partnership expansion. 
- CFO absence noted, with Matt LaMalva covering financials. 

**【CEO Commentary】**
- New pricing algorithm improved customer LTVs by 20%, with UBI model predictive power up 10%. 
- Partnership channel new writings tripled YoY, representing 50% of partnership distribution. 
- Direct channel growth despite 9%+ competition, with Q4 marketing investment +$5M. 

**【CFO Financial Commentary】**
- Q3 net loss $5M, operating income $0.3M, adj. EBITDA $34M. 
- 59% accident loss ratio, $309M unencumbered capital. 
- Q4 expects 3-5pt seasonal loss ratio increase, no tariff impact seen. 

**【Q&A Highlights】**
- Agent penetration <10%, IIA channel 3x YoY growth. 
- Direct channel rate decreases in Florida, no broad rate cuts planned. 
- October PIF growth accelerated vs. Q3, Q4 marketing spend +$5M. 
- Tariffs no impact on loss ratios, seasonal Q4 loss ratio rise expected.

Root, Inc. (ROOT) Q3 2025 Earnings Call Transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

Deferred Income Tax

Income Tax Adjustments

Net Income from Continuing Operations

Income from Discontinued Operations

Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

Net Income Attributable to Common Stockholders

Other Comprehensive Income

Total Comprehensive Income

Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

Basic EPS from Continuing Operations

Basic EPS from Discontinued Operations

Diluted EPS

Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

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