Overview
Home insurtech Hippo reported its first-ever positive net income in Q2 2025, closing the quarter with $1 mn in profit. Gross written premium reached $299mn, up 16% from $258mn a year earlier. Growth came primarily from the company’s hybrid fronting strategy.
This milestone reflects a combination of revenue growth, a broader premium mix, a lower consolidated net loss ratio, stronger operating efficiency, and reduced stock-based compensation costs.
Quarterly operating expenses for sales and marketing, tech and development, and general and administrative functions fell by $6mn compared to Q2 2024 — a 16% year-over-year drop.
Existing programs added $24mn in organic growth (up 13%), while new programs contributed another $23mn.
Meanwhile, gross written premiums for Hippo’s core home insurance product declined 9% year-over-year.
The company’s cash and investment holdings (excluding restricted cash) rose by $76mn quarter-over-quarter, reaching $604mn. Most of that increase came from the issuance of a $50mn surplus note.
Revenue Growth Driven by Insurance-as-a-Service
Hippo reported total revenue of $117.3mn for Q2 2025, up 31% from $89.6mn in Q2 2024. This growth came primarily from the Insurance-as-a-Service (IaaS) segment, which nearly doubled its revenue from $24.4mn to $48mn (+97%).
The Hippo Home Insurance Program grew moderately by 8% (from $56.2mn to $60.6mn), while Services revenue fell slightly by 3%.
Expense Management Shows Mixed Signals
Total expenses declined 7% year-over-year, from $126.1mn to $113.3mn, largely due to a reduction in losses and loss adjustment expenses, which dropped from $60.4mn to $44.5mn. However, insurance-related expenses increased from $24.5mn to $32.8mn. Sales and marketing costs were cut by 31%, and general/admin expenses also decreased, showing signs of operational tightening.
Segment Expense Shifts Highlight Strategy Pivot
- Insurance-as-a-Service expenses surged 120% (from $15.8mn to $34.8mn), indicating rapid investment in growth.
- The Hippo Home Insurance Program saw a 33% drop in expenses, likely a result of scaling back or achieving better underwriting efficiency.
- Services expenses fell by 8%, consistent with the decline in revenue.
Improved Operating Results Across All Segments
- Adjusted operating income turned positive for the first time in the Hippo Home Insurance Program: $4.8mn in Q2 2025 vs. $(26.0)mn loss in Q2 2024.
- IaaS segment also posted strong adjusted operating income of $10.0mn, up 75% from $5.7mn.
- Services still operates at a loss, but losses narrowed from $(4.5)mn to $(3.2)mn.
Key Metrics
| Metric | Q2 2025 | Q2 2024 | % Change |
|---|---|---|---|
| Total Revenue | $117.3mn | $89.6mn | +31% |
| Net Earned Premium | $94.0mn | $64.4mn | +46% |
| Total Expenses | $113.3mn | $126.1mn | -10% |
| Net Income (Loss) | $(3.9)mn | $(37.2)mn | +90% |
| Adjusted Operating Income | $11.8mn | $(24.9)mn | N/A |
Net Loss Narrows Significantly
Hippo’s net loss narrowed to $(3.9)mn in Q2 2025, a significant improvement from $(37.2)mn in the same quarter last year. Income (loss) before taxes also flipped to a positive $4.0mn, compared to a $(36.5)mn loss in Q2 2024. This turnaround was driven by higher revenue and tighter control over claim-related costs and marketing expenses.
