On Wednesday, Goosehead Insurance (NASDAQ:GSHD) discussed first-quarter financial results during its earnings call. The full transcript is provided below.
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Summary
Goosehead Insurance reported Q1 2026 revenue growth of 23% year-over-year to $93 million, with core revenue up 15% to $79 million and adjusted EBITDA at $24.4 million.
The company highlighted strategic investments in their digital agent platform and AI initiatives, leading to significant improvements, including a 19% resolution rate of inbound calls through their AI assistant, Lilly.
Goosehead Insurance is expanding its digital marketplace, allowing clients to shop, quote, and buy insurance digitally, and announced new partnerships with several carriers for this capability.
The company opened three new corporate offices in Seattle, D.C., and Minneapolis, and plans further geographic expansion to drive growth, with more than half of their corporate agents now outside Texas.
Management reiterated their guidance for 2026, expecting organic growth in total revenues between 10% and 19%, and total written premiums to grow between 12% and 20%.
Full Transcript
Operator
Good day and thank you for standing by. Welcome to The Goosehead Insurance first quarter 2026 earnings conference call. At this time all participants are in a listen only mode. Please be advised that today’s conference is being recorded. After the speaker’s presentation there will be a question and answer session. To ask a question, please press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. I would now like to hand the conference over to your speaker today, Maddie Middleton, Senior Director of Investor Relations.
Maddie Middleton (Senior Director of Investor Relations)
Thank you and good afternoon. Before we begin our formal remarks, I need to remind everyone that part of our discussion today may include forward looking statements which are based on expectations, estimates and projections of management. As of today, forward looking statements and our discussions are subject to various assumptions, risks and uncertainties that are difficult to predict and which could cause actual results to differ materially from those expressed or implied in the forward looking statements. These statements are not guarantees of future performance and therefore undue reliance should not be placed on them. We refer all of you to our recent SEC filings for a more detailed discussion of risks and uncertainties that could impact future operating results and financial condition of Goosehead. We disclaim any intention or obligation to update or revise any forward looking statements except to the extent required by applicable law. I would also like to point out that during this call we will discuss certain financial measures that are not prepared in accordance with GAAP. Management uses these non GAAP financial measures when planning, monitoring and evaluating our performance. We consider these non GAAP financial measures to be useful metrics for management and investors to facilitate operating performance comparisons period to period by including potential differences caused by variations in capital structure, tax position, depreciation, amortization and certain other items that we believe are not representative of our core business. 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. In addition, this call is being webcast and an archived version will be made available shortly after the call ends on the investor relations portion of the company’s website@goosehead.com now I’d like to turn the call over to our CEO, Mark Miller.
Mark Miller (Chief Executive Officer)
Thanks Mattie and good afternoon everyone. Thank you for joining us today for our first quarter 2026 earnings call. I’d like to begin by welcoming John Martin as our new Chief Financial Officer, succeeding Mark Jones Jr. Who has been promoted to President and COO. John brings a strong combination of financial expertise operational discipline and a background rooted in technology and E commerce, which aligns well with our focus on execution and our high performance culture. The team is excited to welcome John and I know he looks forward to engaging with our investors and analysts in the quarters ahead. We are equally thrilled to see Mark expand his leadership responsibilities. John will report to Mark and I will work closely with both of them, continuing my role as CEO. These leadership announcements are evidence of our commitment to a comprehensive succession plan and our focus on ensuring Goosehead has the right leaders for today and well into the future. Let me start by reinforcing something we’ve said consistently. Goosehead is a compounding business designed to drive long term growth and policies in force, revenue, earnings and ultimately cash flow. We achieved that by operating a highly scalable distribution platform supported by world class service. For the first quarter we delivered strong and consistent financial results with revenue growing 23% to $93 million, core revenue growing 15% to $79 million and delivering adjusted EBITDA of 24.4 million. Last quarter we spent a significant amount of time discussing investments we’re making in our digital agent platform and AI initiatives. We have been very intentional in prioritizing long term value creation while managing to strong and sustainable margins in order to maximize shareholder returns. Today I want to focus on the strong start to the year and how the investments we have been making are beginning to translate into tangible business results. Goosehead has always been a technology forward distribution platform, but over the past several years technology has become even more deeply embedded in every part of how we operate. What’s in front of us today is what I believe is the single largest opportunity our business and the broader personal lines industry has ever seen. In nearly every industry, customers have the ability to choose how they want to interact and transact. That has not existed in the independent personal lines insurance space. Until now. Choice has always been part of Goosehead’s DNA. Historically, that choice has been centered around access to a broad set of carrier partners. We’ve proven that we are a market leader in providing clients coast to coast with access to over 200 underwriting partners. But today we’re expanding that definition of choice. We’re now giving clients a choice in how they prefer to actually transact. For the first time in the United States, clients can shop, quote and buy into insurance through a true choice model, whether that is fully digital, partially digital or entirely human driven. During our last earnings call we announced we went live with this capability with multiple auto carriers in Texas, including partners like Progressive Liberty Mutual, Mercury and Root Today we’re excited to announce that clients can now digitally buy multiple homeowners products in Texas with carriers such as sagesure and Mercury. This is an important milestone in building a large scale digital marketplace which is now that much more achievable because of the real demand that now exists with our carrier partners. Carriers want this capability and they want it specifically with Goosehead because of the trusted relationships we built over decades for access to large amounts of integrated data that drive better underwriting outcomes and our differentiated go to market strategy executed through highly curated client acquisition channels. At the same time, the broader insurance shopping experience, particularly online, remains fragmented and often broken. You may see advertising across social media for AI insurance agencies that claim they can bind and service autonomously or headlines that declare instant best rates. Those false claims end up generating terrible experiences for the end user. Customers are frequently routed through lead aggregators and data resellers, creating the illusion of choice but ultimately leading to confusion, lack of transparency and in many cases poor coverage decisions. Goosehead’s digital agent platform is solving these pain points. We’re delivering real choice not just in product offering but now in purchasing experience and by implementing this platform with a targeted audience. Through our partnerships, we remain the trusted advisor our clients and carrier partners rely on. In the area of AI, we are now seeing tangible benefits as we roll out multiple use cases across our service organization. Lilly, our AI powered virtual phone assistant is now fully resolving approximately 19% of all inbound calls without requiring transfer to a live agent. This improves speed to resolution for our clients and allows our service teams to focus on more complex consultative interactions. In addition, we have deployed tools behind the scenes in areas such as intelligent case routing which has allowed us to reinvest roughly 40 full time service team members towards more complex and value added interactions. These tools are driving real time efficiency gains while also adding scalability to what has historically been the most complex and labor intensive part of our business. All of this progress is occurring alongside a rapidly improving product market. Our carrier partners are increasingly leaning into growth across both home and auto products nationwide. As pricing stabilizes and product availability expands, we are seeing consistent improvement in many of our key operating metrics. For example, our client retention continues to climb at a steady pace and we expect to achieve 86% client retention during the year. Buying rates and packet rates are increasing, supporting higher agent productivity. Given these strong market conditions, we believe the time is right to more aggressively expand our offensive capability with more agents and more geographies. When we spoke to you in February, I commented that we had fundamentally reset the Corporate agent footprint. At that time, we expanded to new geographies like Tempe, Arizona and Nashville, Tennessee. We’re continuing to make excellent progress on this initiative. During the quarter, we opened three additional corporate offices in Seattle, the Washington, D.C. area in Minneapolis, and we had the fourth opening in April in Indianapolis. As of the end of the first quarter, we now have more than half of our corporate agents outside of Texas. These three offices are outperforming our expectations. But even more importantly, these offices serve a strategic purpose that far exceeds the short term production they generate. They’re quickly diversifying our agent base, making Goosehead an even more attractive partner for our major national carriers. And these offices are talent incubators for future franchise ownership. Since the beginning of the year, we have launched 12 new franchises out of our corporate offices, all of which are outperforming the average franchises we have launched from outside of our ecosystem. In just their second month live, these 12 launches contributed new business production that were nearly 2.5 times the average franchise. Our existing franchise base also continues to lean into growth with 133 franchises hiring at least one producer during the quarter, generating nearly 50% increase in gross producer adds Year over year. As agencies continue to focus on hiring and driving productivity, they’re reaching new highs with 208 franchises hitting monthly production records during the quarter. On top of that momentum, our enterprise sales and partnership teams are rapidly gaining scale. What was a startup inside the organization just two years ago is now meaningfully contributing to total revenue. When we step back, we’re building more than an insurance agency. We’re building a technology enabled distribution platform that delivers real choice, a frictionless experience and better outcomes for clients and carrier partners. I want to thank and recognize our teammates. This quarter’s performance is a direct result of their discipline, execution and commitment to delivering a world class client experience. With that, I’ll turn it over to Mark Jones Jr. Our president and COO.
Mark Jones Jr. (President and Chief Operating Officer)
Thanks Mark and good afternoon to everyone joining us. I want to echo Mark’s sentiment in welcoming John as our new cfo. I look forward to working closely with him in the future. What an exciting time it is here at Goosehead. We’ve now built the country’s first choice online shopping platform in the history of the personal lines insurance with our Digital Agent 2.0. As we enter into a new world for insurance distribution, it’s important that we take a step back and fully understand what that means for clients, carrier partners, strategic partners and agents alike. As Mark Miller discussed, for clients you now have choice not only in what underwriter you have access to, but how you engage and transact why did this never exist before? Because there’s never been a personalized agency like Goosehead. Selling and servicing multiple product lines across 50 states with over 200 carriers is a challenge no other company has been bold enough to tackle. A frictionless choice shopping model has many hurdles in development that can’t easily be solved by throwing money at the problem. It takes deep domain expertise across regulators, product knowledge, client behavior, and the inner workings of fragmented technology solutions across the industry. Each regulator has different requirements, each carrier has bespoke underwriting criteria and a differing technology stack with degrees of sophistication, and each client segment has unique needs and preferences. How are we able to solve this? We’ve been very intentional about our location in the value chain and distribution. We built a strong and lasting relationships with our carrier partners to make sure our goals are aligned and we can deliver a differentiated experience to them. We’ve been thoughtful about geographic expansion so we understand the specific nuance of each critical state. We’ve spent 20 years and hundreds of millions of dollars in our company’s history investing in technology to drive the industry forward, and we have always placed the client at the center of our universe so we have a clear understanding of what matters not just at the initial sale, but that client’s entire life cycle. I’m incredibly proud of our team for what we have delivered so far, but we are just getting started in the coming quarters. We plan to continue to expand our offering with new carrier partners, roll out to additional states and add features and functionality that improve the client experience and conversion rates to maximize the economic returns. As exciting as the rollout of our digital agent 2.0 is, I’m equally excited about the direction of our corporate franchise and enterprise teams. As Mark Miller mentioned, we launched three new corporate offices in the quarter, including Seattle, the D.C. area, and Minneapolis, all of which are hitting the ground running. As we’ve discussed, we’re highly intentional with where we grow our presence for the benefit of our teammates, our clients and our carrier partners. Productivity in our corporate channel continues to improve, supported by increased lead flow and better conversion from a combination of the improving product market expansion into untapped geographies and investments in our management infrastructure. The enterprise sales team, which is fueled by our partnership efforts, continued its rapid growth in the first quarter, generating new business growth of over 70% and contributing approximately 20% of the production of new business commissions and agency fees. The partnerships that feed that team now include 2.3 million potential clients across mortgage origination and servicing, as well as 4 million potential clients from other home and financial services organizations. While there may be some overlap across our partner client base, that improves our likelihood of conversion as we increase the number of touch points we have with potential clients. The momentum we’re seeing across …
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