Porch Group, Inc. (PRCH)

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Forward-Looking Statements

This quarterly report on Form 10-Q (this “Quarterly Report”) and the documents incorporated herein by reference contain forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. These statements are based on the beliefs and assumptions of management. Although we believe that our plans, intentions, and expectations reflected in or suggested by these forward-looking statements are reasonable, we cannot assure you that we will achieve or realize these plans, intentions, or expectations. Forward-looking statements are inherently subject to risks, uncertainties, and assumptions. Generally, statements that are not historical facts, including statements concerning our possible or assumed future actions, business strategies, events, or results of operations, are forward-looking statements. These statements may be preceded by, followed by, or include the words “believe,” “estimate,” “expect,” “project,” “forecast,” “may,” “will,” “should,” “seek,” “plan,” “scheduled,” “anticipate,” “intend,” or similar expressions.

Forward-looking statements are not guarantees of performance. You should not put undue reliance on these statements which speak only as of the date hereof. You should understand that the following important factors, among others, could affect our future results and could cause those results or other outcomes to differ materially from those expressed or implied in our forward-looking statements:

•expansion plans and opportunities, and managing growth, to build a consumer brand;

•the incidence, frequency, and severity of weather events, extensive wildfires, and other catastrophes;

•economic conditions, especially those affecting the housing, insurance, and financial markets;

•expectations regarding revenue, cost of revenue, operating expenses, and the ability to achieve and maintain future profitability;

•existing and developing federal and state laws and regulations, including with respect to insurance, warranty, privacy, information security, data protection, and taxation, and management’s interpretation of and compliance with such laws and regulations;

•the structure, availability, and performance of Porch Reciprocal Exchange (the “Reciprocal”)’s and Homeowners of America (“HOA”)’s reinsurance programs to protect against loss and maintain their financial stability ratings and a healthy surplus, the success of which are dependent on a number of factors outside management’s control;

•the possibility that a decline in our share price would result in a negative impact to the Reciprocal’s surplus position and may require further financial support to enable the Reciprocal to meet applicable regulatory requirements and maintain financial stability rating;

•the possibility that a decline in our share price would result in a negative impact to our captive reinsurance business' capital and collateral portfolio, and may require further financial support to enable the captive reinsurance business to meet applicable regulatory requirements;

•uncertainties related to regulatory approval of insurance rates, policy forms, insurance products, license applications, acquisitions of businesses, or strategic initiative, and other matters within the purview of insurance regulators (including the discount associated with the shares contributed to HOA that were subsequently transferred to the Reciprocal in connection with the closing of the sale of HOA to the Reciprocal);

•the ability of the Company and its affiliates to successfully operate and manage the Reciprocal and our ability to successfully operate our businesses alongside a reciprocal exchange;

•our ability to implement our plans, forecasts and other expectations with respect to the Reciprocal and to realize expected synergies and/or convert policyholders from our existing insurance carrier business into policyholders of the Reciprocal;

•reliance on strategic, proprietary relationships to provide us with access to personal data and product information, and the ability to use such data and information to increase transaction volume and attract and retain customers;

•the ability to develop new, or enhance existing, products, services, and features and bring them to market in a timely manner;

•the ability to effectively integrate and leverage artificial intelligence and machine learning technologies;

•changes in capital requirements, and the ability to access capital when needed to provide statutory surplus;

•our ability to timely repay our outstanding indebtedness;

•the increased costs and initiatives required to address new legal and regulatory requirements arising from developments related to cybersecurity, privacy, and data governance and the increased costs and initiatives to protect against data breaches, cyber-attacks, virus or malware attacks, or other infiltrations or incidents affecting system integrity, availability, and performance;

•retaining and attracting skilled and experienced employees;

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•costs related to being a public company; and

•other risks and uncertainties discussed in Part II, Item 1A, “Risk Factors,” in our Annual Report on Form 10-K for the year ended December 31, 2025, and in subsequent reports filed with the Securities and Exchange Commission (“SEC”), all of which are available on the SEC’s website at www.sec.gov.

We caution you that the foregoing list may not contain all the risks to forward-looking statements made in this Quarterly Report.

You should not rely upon forward-looking statements as predictions of future events. We have based the forward-looking statements contained in this Quarterly Report primarily on our current expectations and projections about future events and trends we believe may affect our business, financial condition, results of operations and prospects. The outcome of the events described in these forward-looking statements is subject to risks, uncertainties, and other factors, including those described above and elsewhere in this Quarterly Report. We disclaim any obligation to update publicly any forward-looking statements, whether in response to new information, future events, or otherwise, except as required by applicable law.

Business Overview

Porch Group, Inc., together with its consolidated subsidiaries, (“Porch,” the “Company,” “we,” “our,” “us”) is a new kind of homeowners insurance company—one designed to stand out in a massive and growing market. Our strategy is built on three differentiators that set us apart.

1.Advantaged Underwriting Through Proprietary Data

Leveraging unique property insights, we can assess risk with greater precision, enabling competitive pricing for low-risk customers and avoiding high-risk customers, while delivering superior underwriting performance.

2.Best Services for Homebuyers

We are committed to being the go-to partner during one of life’s most significant transitions—buying a home—by offering services that simplify moving and home setup.

3.More Protection

We combine homeowners insurance with home warranty, filling coverage gaps and reducing unexpected costs for consumers.

Beyond insurance, Porch is a leader in the home software-as-a-service (“SaaS”) space, serving approximately 19 thousand companies across industries essential to the home-buying process—home inspectors, title companies, mortgage providers, and more. Our deep relationships and proprietary data give us unique visibility into approximately 90% of U.S. homebuyers and approximately 90% of U.S. homes, enabling superior risk assessment and competitive pricing.

Our mission is to be the best homeowners insurance partner for homebuyers, offering more than just coverage. Through the Porch app, we provide a full moving concierge service, helping customers with moving logistics and essential home services like security, TV/Internet setup, and more.

Finally, we deliver greater home protection by pairing homeowners insurance with full home warranty, additional coverages, and appliance recall monitoring. This approach fills coverage gaps, reduces unexpected costs, and strengthens our value proposition—creating deeper, lasting relationships with our customers.

Segments

We operate under four reportable segments that are also our operating segments. Three of these segments are owned by Porch — Insurance Services, Software & Data, and Consumer Services. The fourth segment, the Reciprocal Segment, is managed, but not owned, by Porch and, at this time, is consolidated for reporting purposes as described in the basis of presentation section in Note 1 of the unaudited Notes to Condensed Consolidated Financial Statements.

Insurance Services — Our Insurance Services segment manages and operates the Reciprocal, providing services related, but not limited, to underwriting, policy renewal, risk management, insurance portfolio management, financial management, and setting investment guidelines in exchange for commissions and fees. The Insurance Services segment also holds the surplus notes issued by the Reciprocal and includes our captive reinsurer which provides reinsurance support to improve capital efficiency for the Reciprocal. Our captive reinsurer only provides reinsurance coverage for risks with low earnings volatility

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Software & Data — Our Software & Data segment provides, on a subscription and predominantly transactional basis, software to inspection, mortgage, title, and roofing companies and data products to insurance and other types of companies. This segment includes several strategically important businesses, including home inspection software, title and mortgage software, Home Factors (our unique property insights product), and mover marketing products.

Consumer Services — Our Consumer Services segment provides warranty products through Porch Warranty and other warranty brands to protect the whole home. Our Consumer Services segment also provides moving-related services such as movers, TV/Internet, and security.

Reciprocal Segment — The Reciprocal Segment includes HOA and its parent, Porch Reciprocal Exchange, which is a member-owned reciprocal exchange, owned by policyholder members rather than Porch. The Reciprocal Segment provides consumers with insurance to protect their homes, earning revenue primarily through premiums collected on policies.

Relationship with Reciprocal

Porch manages and operates the Reciprocal for its subscribers, providing services related, but not limited, to underwriting, policy renewal, risk management, insurance portfolio management, financial management, and setting investment guidelines. The Reciprocal is a subscriber-owned reciprocal insurance exchange organized under the Texas Insurance Code under which individuals, partnerships, and corporations are authorized to exchange reciprocal or inter-insurance contracts with each other, or with individuals, partnerships, and corporations of other states and countries, providing indemnity among themselves from any loss which may be insured against under any provision of the insurance laws. In exchange for these services, Porch receives policy fees from policyholders and ongoing commissions from the Reciprocal.

Our operating results are, in large part, tied to the growth and financial condition of the Reciprocal. If any events occurred that impaired the Reciprocal's ability to grow or sustain its financial condition, including but not limited to reduced financial strength ratings, disruption in the independent agency relationships, significant catastrophe losses, or products not meeting customer demands, the Reciprocal could find it more difficult to retain its existing business and attract new business. A decline in the business of the Reciprocal almost certainly could have as a consequence a decline in the total premiums paid and a correspondingly adverse effect on the a

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Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Business Overview

Porch Group, Inc., together with its consolidated subsidiaries, (“Porch,” the “Company,” “we,” “our,” “us”) is a new kind of homeowners insurance company—one designed to stand out in a massive and growing market of more than $100 billion. Our strategy is built on three differentiators that set us apart.

1.Advantaged Underwriting Through Proprietary Data

Leveraging unique property insights, we can assess risk with greater precision, enabling competitive pricing for low-risk customers and avoiding high-risk customers, while delivering superior underwriting performance.

2.Best Services for Homebuyers

We are committed to being the go-to partner during one of life’s most significant transitions—buying a home—by offering services that simplify moving and home setup.

3.More Protection

We combine homeowners insurance with home warranty, filling coverage gaps and reducing unexpected costs for consumers.

Beyond insurance, Porch is a leader in the home software-as-a-service (“SaaS”) space, serving approximately 24 thousand companies across industries essential to the home-buying process—home inspectors, title companies, mortgage providers, and more. Our deep relationships and proprietary data give us unique visibility into approximately 90% of U.S. homes, enabling superior risk assessment and competitive pricing.

Our mission is to be the best homeowners insurance partner for homebuyers, offering more than just coverage. Through the Porch app, we provide a full moving concierge service, helping customers with moving logistics and essential home services like security, TV/Internet setup, and more.

Finally, we deliver greater home protection by pairing homeowners insurance with full home warranty, additional coverages, and appliance recall monitoring. This approach fills coverage gaps, reduces unexpected costs, and strengthens our value proposition—creating deeper, lasting relationships with our customers.

In January 2025, we completed the formation of Porch Reciprocal Exchange (the “Reciprocal”) and, as part of this process, sold our legacy homeowners insurance carrier, Homeowners of America (“HOA”), to the Reciprocal. Following the sale, HOA became a wholly owned subsidiary of the Reciprocal. Porch continues to manage and operate the Reciprocal, providing critical services such as underwriting, policy renewal, risk and portfolio management, financial oversight, and investment guideline setting. In return, Porch earns commissions and fees for these services.

Beginning in January 2025, we operate under four reportable segments that are also our operating segments. Three of these segments are owned by Porch — Insurance Services, Software & Data, and Consumer Services. We collectively call these three segments, along with corporate functions, the “Porch Shareholder Interest.” The fourth segment, the Reciprocal Segment, is managed, but not owned, by Porch and, at this time, is consolidated for reporting purposes as described in the basis of presentation section in Note 1 of the unaudited Notes to Consolidated Financial Statements.

Insurance Services — Our Insurance Services segment manages and operates the Reciprocal, providing services related, but not limited, to underwriting, policy renewal, risk management, insurance portfolio management,

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financial management, and setting investment guidelines in exchange for commissions and fees. The Insurance Services segment also holds the surplus notes issued by the Reciprocal and includes our captive reinsurer which provides reinsurance support to improve capital efficiency for the Reciprocal. As of April 1, 2025, our captive reinsurer only provides reinsurance coverage for risks with low earnings volatility, such as non-catastrophic weather quota share.

Software & Data — Our Software & Data segment provides, on a subscription and predominantly transactional basis, software to inspection, mortgage, title, and roofing companies and data products to insurance and other types of companies. This segment includes several strategically important businesses, including home inspection software, title and mortgage software, Home Factors (our unique property insights product), and mover marketing products.

Consumer Services — Our Consumer Services segment provides warranty products through Porch Warranty and other warranty brands to protect the whole home. Our Consumer Services segment also provides moving related services such as movers, TV/Internet, and security.

Reciprocal Segment — The Reciprocal Segment includes HOA and its parent, Porch Reciprocal Exchange, which is a member-owned reciprocal exchange, owned by policyholder members rather than Porch. The Reciprocal Segment provides consumers with insurance to protect their homes, earning revenue primarily through premiums collected on policies.

Porch manages and operates the Reciprocal for its subscribers, providing services related, but not limited, to underwriting, policy renewal, risk management, insurance portfolio management, financial management, and setting investment guidelines. The Reciprocal is a subscriber-owned reciprocal insurance exchange organized under the Texas Insurance Code under which individuals, partnerships, and corporations are authorized to exchange reciprocal or inter-insurance contracts with each other, or with individuals, partnerships, and corporations of other states and countries, providing indemnity among themselves from any loss which may be insured against under any provision of the insurance laws. In exchange for these services, Porch receives policy fees from policyholders and ongoing commissions from the Reciprocal.

Porch Shareholder Interest is, in large part, tied to the growth and financial condition of the Reciprocal. If any events occurred that impaired the Reciprocal's ability to grow or sustain its financial condition, including but not limited to reduced financial strength ratings, disruption in the independent agency relationships, significant catastrophe losses, or products not meeting customer demands, the Reciprocal could find it more difficult to retain its existing business and attract new business. A decline in the business of the Reciprocal almost certainly could have as a consequence a decline in the total premiums paid and a correspondingly adverse effect on the amount of the management fees received by our Insurance Services segment.

See “Item 1. Business,” Strategic Growth Pillars, for more information about our business and changes to our business in 2025.

Basis of Presentation

The consolidated financial statements and accompanying notes include the accounts of Porch Group, Inc. and its subsidiaries as well as the Reciprocal, a variable interest entity (“VIE”) in which the Company is considered the primary beneficiary. The Reciprocal is managed, but not owned by, Porch and is consolidated at this time as a VIE for reporting purposes. These consolidated financial statements and accompanying notes were prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). All significant intercompany accounts and transactions are eliminated in consolidation.

Critical Accounting Estimates

Our significant accounting policies, including the assumptions and judgment underlying them, are disclosed in Note 1, Description of Business and Summary of Significant Accounting Policies, of the Notes to Consolidated Financial Statements in “Item 8. Financial Statements and Supplementary Data” of this Annual Report. As disclosed in Note 1, Description of Business and Summary of Significant Accounting Policies, of the Notes to Consolidated Financial Statements, the preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ materially from those estimates and assumptions, and those differences could be material to the consolidated financial statements. We believe that the following discussion addresses our most critical accounting

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estimates, which are those that are most important to the portrayal of our financial condition and results of operations and require management’s most difficult, subjective, and complex judgments.

Fair Value Measurements

Fair value is an exit price representing the expected amount that an entity would receive to sell an asset or pay to transfer a liability in an orderly transaction with market participants at the measurement date. Fair value principles prioritize valuation inputs across three broad levels. An asset or liability’s classification within the various levels is determined based on the lowest level input that is significant to the fair value measurement.

Business Combinations

We have engaged in mergers and acquisitions in the past and intend to continue to make acquisitions a part of our long-term strategy. We account for business acquisitions using the acquisition method of accounting and record any identifiable intangible assets separate from goodwill. Intangible assets are recorded at fair value based on estimates as of the date of acquisition. Goodwill is recorded as the residual amount of the purchase price consideration less the fair value assigned to the individual identifiable assets acquired and liabilities assumed as of the date of acquisition. The accounting estimates associated with acquisitions are complex due to judgments and assumptions involved in determining (1) the total consideration paid because we have used cash, equity, and earnouts and (2) the value of assets acquired and liabilities assumed. We allocate the purchase price of the acquisition to the assets acquired and liabilities assumed based on estimates of the fair value at the dates of the acquisitions. Contingent consideration, which represents an obligation to make additional payments or equity interests to the former owner(s) as part of the purchase price if specified future events occur or conditions are met, is accounted for at the acquisition date fair value either as a liability or as equity depending on the terms of the acquisition agreement.

Impairment of Long-Lived Assets

We review long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amounts of the assets may not be fully recoverable. Events that trigger a test for recoverability include a significant decrease in the market price for a long-lived asset, significant negative industry or economic trends, an accumulation of costs significantly in excess of the amount originally expected for the acquisition, a current-period operating or cash flow loss combined with a history of operating or cash flow losses or a projection or forecast that demonstrates continuing losses associated with the use of a long-lived asset, or a sustained decrease in share price. When a triggering event occurs, a test for recoverability is performed, comparing projected undiscounted future cash flows to the carrying value of the asset group. If the test for recoverability identifies a possible impairment, the asset group’s fair value is measured relying primarily on an income approach. An impairment charge is recognized for the amount by which the carrying value of the asset group exceeds its estimated fair value. Management identifies the asset group that includes the potentially impaired long-lived asset, at the lowest level at which there are separate, identifiable cash flows. We evaluate corporate assets or other long-lived assets that are not asset group-specific at the consolidated level.

We estimate the fair value of an asset group using the income approach. Such fair value measurements are based predominately on Level 3 inputs. Inherent in our development of cash flow projections are assumptions and estimates derived from a review of our operating results, business plan forecasts, expected growth rates, and cost of capital, similar to those a market participant would use to assess fair value. We also make certain assumptions about future economic conditions and other data. Many of these factors used in assessing fair value are outside the control of management and these assumptions and estimates may change in future periods.

Impairment of Goodwill

We test goodwill for impairment for each reporting unit on an annual basis or more frequently when events or changes in circumstances indicate the fair value of a reporting unit may be less than its carrying amount. We have the option to perform a qualitative assessment to determine if an impairment is more likely than not to have occurred. Factors that indicate the fair value of a reporting unit may be less than its carrying amount include industry and market considerations such as a deterioration in the economic environment or a decline in market-dependent multiples or metrics, overall financial performance such as negative or declining cash flows or a decline in actual or planned revenue or earnings, increased cost factors that have a negative effect on earnings and cash flows, or a sustained decrease in share price. The process for evaluating potential impairment of goodwill is highly subjective and requires significant judgment. If factors indicate that the fair value of the reporting unit is less than its carrying amount, we perform a quantitative assessment and the fair value of the reporting unit is estimated. If the fair value of a reporting unit is less than its carrying amount, an impairment loss is recorded to the extent that fair value of the reporting unit is less than its carrying amount. We have selected October 1 as the date to perform our annual impairment test.

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Determining the fair value of a reporting unit is judgmental in nature and involves the use of significant estimates and assumptions to evaluate the impact of operating and macroeconomic changes on each reporting unit. The fair value of each reporting unit was estimated using a combination of income and market valuation approaches using publicly traded company multiples in similar businesses. Such fair value measurements are based predominately on Level 3 inputs. This analysis requires significant judgments, including estimation of future cash flows, which is dependent on internally developed forecasts, estimation of the long-term rate of growth for our business, estimation of the useful life over which cash flows will occur, and determination of our weighted average cost of capital, which is risk-adjusted to reflect the specific risk profile of the reporting unit being tested.

Losses and Loss Adjustment Expenses Reserves

The liability for losses and loss adjustment expenses (“LAE”) is an estimate of the amounts required to cover known incurred losses and LAE and is developed through the review and assessment of loss reports, along with the analysis of known claims. These reserves include the Reciprocal’s estimate of the amounts for losses incurred but not reported (“IBNR”). IBNR is reviewed regularly using a variety of actuarial techniques. The Reciprocal updates the reserve estimates as historical loss experience develops, additional claims are reported and/or settled and new information becomes available. Any changes in estimates are reflected in operating results in the period in which the estimates are changed. Although the Reciprocal believes that the balance of these reserves is adequate, such liabilities are necessarily dependent on estimates, the ultimate expense may be more or less than the amounts presented. The approach and methods for developing these estimates and for recording the resulting liability are continually reviewed. Any adjustments to this reserve are recognized in the Consolidated Statements of Operations and Comprehensive Loss. Losses and LAE, less related reinsurance is charged to expense as incurred.

Recent Developments

Debt Refinancing

On May 27, 2025, we completed a series of privately negotiated refinancing transactions with certain holders of our 0.75% Convertible Senior Unsecured Notes due in September 2026 (the “2026 Notes”). As part of these refinancing transactions, we:

•Exchanged $96.8 million aggregate principal amount of 2026 Notes for $83.0 million aggregate principal amount of newly issued 9.00% Convertible Senior Unsecured Notes due 2030 (the “2030 Notes”),

•Issued an additional $51.0 million aggregate principal amount of 2030 Notes for cash to the same investors that participated in the exchange, and

•Repurchased $47.5 million aggregate principal amount of 2026 Notes for $47.3 million in cash.

After funding the cash portion of the repurchase and related expenses, net cash proceeds were approximately $3.7 million. We used these proceeds, along with existing cash on hand, to repurchase an additional $8.9 million aggregate principal amount of the 2026 Notes for $8.4 million cash in May 2025. We recognized a net gain on extinguishment of debt of less than $0.1 million in the second quarter of 2025. Our Board of Directors authorized management to repurchase the remaining 2026 Notes in cash in the open market or through privately negotiated transactions.

During the third quarter of 2025, we repurchased in a series of privately negotiated transactions $12.8 million in aggregate principal amount of our 2026 Notes for $12.3 million, representing 96.5% par value. As a result, we recognized a gain on extinguishment of debt of $0.4 million during the third quarter. As of December 31, 2025, outstanding principal on the 2026 Notes was $7.8 million.

Reciprocal Formation

In January 2025, we completed the formation of the Reciprocal. In connection with the formation, we completed the sale of our homeowners insurance carrier, Homeowners of America (“HOA”), to the Reciprocal for a purchase price equal to HOA’s estimated surplus at December 31, 2024, of approximately $105 million, less $58 million of principal and unpaid interest under a surplus note issued by HOA to Porch in 2023. The purchase price was financed by a surplus note issued by the Reciprocal to Porch, bringing the total surplus notes held by Porch to approximately $106 million. Following the sale, HOA became a wholly owned subsidiary of the Reciprocal and, as part of the transaction, subsequently transferred certain economics to the Reciprocal following Texas Department of Insurance (“TDI”) approval, including the 18.3 million Porch shares held by HOA. Porch manages and operates the Reciprocal, providing services related, but not limited, to underwriting, policy renewal, risk management, insurance portfolio management, financial management, and setting investment guidelines. In addition, Porch maintains the Reciprocal’s books and records and is responsible for its

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accounting and financial reporting. In exchange for these services, Porch receives commissions and fees. The Reciprocal pays all claims and claims adjustment expenses, reinsurance costs, agency commissions, and taxes and license fees.

Reinsurance Programs for the Reciprocal

As of April 1, 2025, coverage for excess of loss catastrophe reinsurance starts at $25.0 million per occurrence up to a loss of $410.0 million. Additionally, the third-party quota share reinsurance contracts start immediately at 7.5% of property and casualty (“P&C”) losses, which includes catastrophe events, bringing the effective retention for the Reciprocal from $25.0 million per occurrence to $23.1 million per occurrence. We also placed reinstatement premium protection to cover any reinstatement premiums due on the second through fourth layers.

Additionally, our captive reinsurance entity provides reinsurance coverage for risks with low earnings volatility, such as non-catastrophic weather quota share, in order to create more capital efficiency at the Reciprocal. This contract was approved for an initial period of 10 years but can be cancelled by Porch or the Reciprocal each year. The specific structure and scope of reinsurance provided by the captive may vary over time as the Reciprocal evaluates its risk transfer strategy and capital requirements.

New Segments

Beginning in January 2025, there was a change in internal reporting provided to the chief operating decision-maker (“CODM”) and a change in the lens through which the CODM makes decisions and allocates resources. As a result, our reportable segments, that are also our operating segments, changed from Vertical Software and Insurance prior to 2025 to Insurance Services, Software & Data, Consumer Services, and the Reciprocal Segment. Three of these segments are owned by Porch — Insurance Services, Software & Data, and Consumer Services. Management references the Insurance Services, Software & Data, and Consumer Services segments, together with corporate expenses, as “Porch Shareholder Interest.” The fourth segment, the Reciprocal Segment, is managed, but not owned, by Porch and is consolidated for reporting purposes.

The changes in reporting were driven by how the CODM views our target customer (e.g. primarily total premium in Insurance Services, primarily businesses in Software & Data, and primarily direct consumers in Consumer Services) and by the shift to a reciprocal exchange model where we are the manager of the Reciprocal rather than the owner of a carrier.

Results of Operations

Key Factors Affecting Operating Results

The following key factors affected our operating results.

•In January 2025, we completed the formation of the Reciprocal and sold HOA into the Reciprocal; Porch now holds $106 million of surplus notes due from the Reciprocal which pay interest of 9.75% plus SOFR. These surplus notes are included in the Reciprocal’s statutory surplus and are eliminated in consolidation for GAAP reporting. Porch earns management fees and quota share reinsurance premiums from the Reciprocal.

•Insurance Services top-of-the-funnel activity reached strong levels across quoting activity and agency appointments. Full year Reciprocal Written Premium (“RWP”) was $480.9 million. RWP converted to Adjusted EBITDA at a rate of 21% given efficient operations at the Reciprocal. See Key Performance Measures and Operating Metrics for definition of RWP.

•In Software and Data, Rynoh implemented a 20% price increase in the first quarter, in line with strategic pricing goals. We remain focused on product innovation, including a continuation of introducing new Home Factors to the market.

•In Consumer Services, new services were launched including packing services online for movers. Partnership efforts are progressing nicely, while our warranty business experienced lower claims activity compared to the prior year.

•Statutory surplus at the Reciprocal rose sequentially throughout the year with statutory surplus of $155.1 million as of December 31, 2025, an increase of $49.4 million from December 31, 2024. The Reciprocal is healthy with $289.4 million of surplus combined with non-admitted assets as of December 31, 2025, an increase of $131.4 million from December 31, 2024.

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Consolidated Results of Operations

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Revenue

Total consolidated revenue including the Reciprocal increased by 10% compared to the prior year. This increase was primarily attributable to lower external reinsurance costs offsetting revenue. In 2025, our captive reinsurer retained a higher proportion of premiums than in the prior year. Revenue related to Porch Shareholder Interest was $418.9 million for the year ended December 31, 2025, as detailed in the tables at the end of this section. Porch Shareholder Interest Revenue is a non-GAAP measure. See Non-GAAP Financial Measures section for definition.

Cost of revenue

Total consolidated cost of revenue including the Reciprocal decreased by $93.5 million, or 40%, from $235.9 million for the year ended December 31, 2024, to $142.4 million for the year ended December 31, 2025. The decrease was primarily the result of strong underwriting at the Reciprocal and fewer catastrophic weather events impacting the Reciprocal, which limited the number of claims. As a percentage of revenue, cost of revenue represented 30% of revenue for the year ended December 31, 2025, compared with 54% for the year ended December 31, 2024. Cost of revenue related to Porch Shareholder Interest was $75.0 million for the year ended December 31, 2025, as detailed in the tables at the end of this section. Porch Shareholder Interest Cost of Revenue is a non-GAAP measure. See Non-GAAP Financial Measures section for definition.

Selling and marketing

Total consolidated selling and marketing expenses including the Reciprocal increased by $16.7 million, or 14%, from $122.9 million for the year ended December 31, 2024, to $139.6 million for the year ended December 31, 2025. The increase was primarily attributable to incentives to insurance agencies as part of our growth strategy, as well as increased marketing expenses related to new warranty products. As a percentage of revenue, selling and marketing expenses represented 29% of revenue in the current year compared to 28% of revenue in the prior year. Selling and marketing expense related to Porch Shareholder Interest was $195.2 million for the year ended December 31, 2025, as detailed in the tables at the end of this section. Porch Shareholder Interest Selling and Marketing is a non-GAAP measure. See Non-GAAP Financial Measures section for definition.

Product and technology

Total consolidated product and technology expenses including the Reciprocal increased by $5.2 million, or 11%, from $48.1 million for the year ended December 31, 2024, to $53.3 million for the year ended December 31, 2025. The increase was primarily driven by an increase in payroll expenses related to software development and an increase in overall software expense. As a percentage of revenue, product and technology expenses represented 11% of revenue in the current year compared to 11% of revenue in the prior year. Product and technology expense related to Porch Shareholder Interest was $50.3 million for the year ended December 31, 2025, as detailed in the tables at the end of this section. Porch Shareholder Interest Product and Technology is a non-GAAP measure. See Non-GAAP Financial Measures section for definition.

General and administrative

Total consolidated general and administrative expenses including the Reciprocal increased by $10.0 million, or 10%, from $95.2 million for the year ended December 31, 2024, to $105.2 million for the year ended December 31, 2025, primarily due to a one-time agency partnership payment, increased legal expenses, and reduction in the gain recognized from the valuation of contingent consideration (see Note 6 in the Notes to Consolidated Financial Statements). As a percentage of revenue, general and administrative expenses represented 22% of revenue in 2025, compared with 22% in 2024. General and administrative expenses related to Porch Shareholder Interest were $92.8 million for the year ended December 31, 2025, as detailed in the tables at the end of this section. Porch Shareholder Interest General and Administrative is a non-GAAP measure. See Non-GAAP Financial Measures section for definition.

Provision for doubtful accounts

Total consolidated provision for doubtful accounts increased by $5.1 million from $0.2 million for the year ended December 31, 2024, to $5.3 million for the year ended December 31, 2025. This increase was primarily related to an increase in losses expected on a prior year reinsurance contract as well as an increase in average warranty receivables related to higher-priced warranty products commensurate with the increase in the average coverage period. Provision for doubtful accounts related to Porch Shareholder Interest was $4.1 million for the year ended December 31, 2025, as detailed in the tables at the end of this section. Porch Shareholder Interest Provision for Doubtful Accounts is a non-GAAP measure. See Non-GAAP Financial Measures section for definition.

Interest expense

Interest expense increased by $9.0 million, or 21%, from $42.5 million in 2024. The increase was primarily driven by the May 2025 exchange of our 0.75% 2026 Notes for newly issued 9.00% 2030 Notes. The higher coupon rate associated with

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the 2030 Notes contributed to the overall increase in interest expense during the period. The following table details the components of interest expense, on the Consolidated Statements of Operations and Comprehensive Loss:

Change in fair value of private warrant liability

The change in fair value of the private warrant liability was a loss of $4.0 million for the year ended December 31, 2025, and a gain of $0.7 million in the same period in 2024. The change in the fair value was primarily related to an increase in the market value of our common stock. The change in fair value of the private warranty liability relates entirely to Porch Shareholder Interest.

Change in fair value of derivatives

The derivative liability decreased by $19.6 million for the year ended December 31, 2025, compared to a decrease of $5.9 million for the year ended December 31, 2024. The value is driven by various factors, including the fair value of the underlying debt and the assumptions regarding timing of possible repurchase events. See Note 6 in the Notes to Consolidated Financial Statements.

Gain on extinguishment of debt

In connection with the repurchase of a portion of the 2026 Notes, we recognized a $27.4 million gain on extinguishment of debt during the year ended December 31, 2024, compared to less than $0.4 million during the year ended December 31, 2025. The trading prices of the 2026 Notes have increased since prior year. See Note 9 in the Notes to Consolidated Financial Statements.

Investment income and realized gains and losses, net of investment expenses

Investment income and realized gains, net of investment expenses decreased by $2.0 million from $13.7 million for the year ended December 31, 2024, to $11.7 million for the year ended December 31, 2025. Total investments balance as of December 31, 2025, was $248.7 million compared to $182.8 million as of December 31, 2024. While our investment balance increased year-over-year, we had lower market yields.

Other income, net

Total consolidated other income, net, including the Reciprocal decreased by $14.7 million from $28.7 million for the year ended December 31, 2024, to $14.0 million for the year ended December 31, 2025. The decrease is primarily driven by a $14.9 million gain on settlement of contingent consideration, offset by a $5.3 million loss on sale of our EIG business, both of which occurred during the year ended December 31, 2024, with no comparable events during the year ended December 31, 2025. Additionally, recoveries on reinsurance contracts were approximately $5.0 million lower for the year ended December 31, 2025, compared to the year ended December 31, 2024. A decrease in recoveries over time was expected following the previously disclosed termination of a reinsurance contract in 2023. See Note 18 in the Notes to Consolidated Financial Statements for detail of other income, net, for each period presented. Other income, net, related to Porch Shareholder Interest was $29.0 million for the year ended December 31, 2025. Porch Shareholder Interest Other Income is a non-GAAP measure. See Non-GAAP Financial Measures section for definition.

Income tax provision

Total consolidated income tax provision including the Reciprocal increased by $9.3 million from a $2.1 million provision for the year ended December 31, 2024, to an $11.4 million provision for the year ended December 31, 2025. Our effective tax rate for the year ended December 31, 2025, was 42.7%, compared to (6.9)% for the year ended December 31, 2024. Our effective tax rate was higher in 2025 compared to 2024 and compared to the 21% statutory tax rate primarily due to the change in valuation allowance and write-off of certain net operating losses of HOA.

Adjusted EBITDA (Loss)

Adjusted EBITDA (Loss) for the year ended December 31, 2025, was $76.6 million, a $69.4 million improvement from $7.2 million for 2024. The year-over-year improvement was primarily attributable to the shift in the business model from

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carrier to the manager of the Reciprocal, producing higher margin management fees. Our Insurance Services segment benefited from the receipt of commissions and fees related to the Reciprocal Segment which began in January 2025 and an increase in interest income from the surplus note due from the Reciprocal Segment. Corporate costs also declined due to reduced workforce, less reliance on third-party consultants, centralizing administrative functions, and shifting hiring to target lower-cost locations. Adjusted EBITDA (Loss) is a non-GAAP measure. See Non-GAAP Financial Measures section for definition.

Refer to “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the 2024 Annual Report on Form 10-K as filed with the SEC on February 25, 2025, for the comparison of the results of operations for the years ended December 31, 2024 and 2023.

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The following tables summarize operating results of the four segments as well as corporate expenses and eliminations.

______________________________________

(1)The “Eliminations” column represents eliminations of transactions between the Insurance Services segment, Software & Data segment, Consumer Services segment, and Corporate column.

(2)The “Porch Shareholder Interest Subtotal” column includes non-GAAP measures that are used by management to evaluate performance. Porch Shareholder Interest includes the Insurance Services, Software & Data, and Consumer Services segments as well as Corporate expenses and applicable intercompany eliminations. See Non-GAAP Financial Measures section.

(3)The “Eliminations Related to Reciprocal Segment” column represents eliminations of transactions between the Reciprocal Segment and other segments or Corporate.

(4)Adjusted EBITDA (Loss) is a non-GAAP measure. See Non-GAAP Financial Measures section for definition.

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______________________________________

(1)The “Eliminations” column represents eliminations of transactions between the Insurance Services segment, Software & Data segment, Consumer Services segment, and Corporate column.

(2)The “Eliminations Related to Reciprocal Segment” column represents eliminations of transactions between the Reciprocal Segment and other segments or Corporate.

(3)Adjusted EBITDA (Loss) is a non-GAAP measure. See Non-GAAP Financial Measures section for definition.

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Porch Shareholder Interest Results (Non-GAAP)

Effective January 2025, Porch shareholders own three segments: Insurance Services, Software & Data, and Consumer Services. Together, these segments—offset by corporate expenses—comprise what we refer to as the “Porch Shareholder Interest.” These segments contribute to Net Income Attributable to Porch and are what is expected to generate cash for Porch shareholders. Comparative period amounts in the following table include only the Insurance Services, Software & Data, and Consumer Services segments as well as corporate expenses. Certain amounts presented in the following table are non-GAAP measures and are reconciled to the nearest GAAP measure in the earlier “Consolidated Year-to-Date Results” section.

______________________________________

(1)Porch Shareholder Interest Revenue, Gross Profit, and Adjusted EBITDA (Loss) are non-GAAP measures. For the year ended December 31, 2025, Porch Shareholder Interest Adjusted EBITDA (Loss) is equivalent to total Adjusted EBITDA (Loss) for consolidated Porch, as Porch no longer owns HOA following its sale to the Reciprocal effective January 1, 2025. See Non-GAAP Financial Measures section.

For the year ended December 31, 2025, Porch Shareholder Interest Revenue increased $105.6 million when compared to the same segments in the prior year. The increase was primarily due to the launch of the Reciprocal in January 2025, and the associated revenue streams as Porch acts as its manager, and an increase in ceding from the Reciprocal Segment with the new reinsurance programs beginning on April 1, 2025. This increase was partially offset by an increase in the average coverage period of our warranty products, resulting in warranty revenue being recognized over a longer timeframe, and a strategic shift to lower revenue, higher profit services in our moving businesses. Porch Shareholder Interest Revenue is a non-GAAP measure. See Non-GAAP Financial Measures section for definition.

Porch Shareholder Interest Gross Profit improved by $146.1 million for the year ended December 31, 2025, when compared to the prior year. This improvement was primarily driven by the shift in the business model from carrier to the operator of the Reciprocal. The increase was also a result of the change in reinsurance programs at our captive reinsurer effective April 1, 2025. Porch Shareholder Interest Gross Profit is a non-GAAP measure. See Non-GAAP Financial Measures section for definition.

Porch Shareholder Interest Adjusted EBITDA (Loss) improved by $72.5 million for the year ended December 31, 2025, compared to the prior year. The improvement was primarily driven by increased ceding activity from the Reciprocal Segment and the shift in the business model from carrier to the operator of the Reciprocal, producing higher margin management fees. Our Insurance Services segment benefited from the receipt of management fees from the Reciprocal Segment, which began in January 2025, and an increase in interest income from the surplus note due from the Reciprocal Segment. Our other segment and corporate costs also declined due to lower professional fees, reduced reliance on third-party consultants, and strong cost control. Porch Shareholder Interest Adjusted EBITDA (Loss) is a non-GAAP measure. See Non-GAAP Financial Measures section for definition.

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INSURANCE SERVICES

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(1)Insurance Services Adjusted EBITDA, Adjusted EBITDA Margin, and Adjusted EBITDA % of RWP are non-GAAP measures. See Non-GAAP Financial Measures section.

(2)See Key Performance Measures and Operating Metrics for definitions of metrics.

(3)Adjusted EBITDA % of RWP is Insurance Services Adjusted EBITDA divided by RWP.

For the year ended December 31, 2025, Insurance Services segment revenue was $266.7 million. For the year ended December 31, 2024, Insurance Services segment revenue was $157.1 million. The 70% increase in Insurance Services segment revenue was primarily driven by an increase in ceding from the Reciprocal Segment with the new reinsurance programs beginning on April 1, 2025. Additionally, the increase partially resulted from the launch of the Reciprocal in January 2025 and the associated revenue streams as Porch acts as its manager.

Our Insurance Services segment generates economics in several ways: management fees based on a percentage of Reciprocal Written Premium, policy fees from the Reciprocal, reinsurance to improve capital efficiency for the Reciprocal, lead fees from third-party insurance agencies, and interest from the surplus note due from the Reciprocal. Insurance Services Adjusted EBITDA as a percentage of Reciprocal Written Premium was 21% for the year ended December 31, 2025.

For the year ended December 31, 2025, Insurance Services segment gross profit was $227.6 million. For the year ended December 31, 2024, Insurance Services segment profit was $80.0 million. The increase in gross profit was primarily driven by the shift in the business model from carrier to the operator of the Reciprocal.

Insurance Services Adjusted EBITDA was $99.7 million for the year ended December 31, 2025, which improved compared to prior year primarily driven by an increase in ceding from the Reciprocal Segment. Adjusted EBITDA also increased as a result of the various commissions and fees beginning January 1, 2025, including interest income from the surplus note due from the Reciprocal Segment.

Insurance Services Adjusted EBITDA Margin increased to 37% for the year ended December 31, 2025, primarily due to the increase in revenue due to increased ceding activity from the Reciprocal Segment. The Adjusted EBITDA Margin increase outpaced the increase in revenue, reflecting a shift in the business model from carrier to the manager of the Reciprocal, producing higher margin management fees.

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SOFTWARE & DATA

______________________________________

(1)Software & Data Adjusted EBITDA and Adjusted EBITDA Margin are non-GAAP measures. See Non-GAAP Financial Measures section.

(2)See Key Performance Measures and Operating Metrics for definitions of metrics. In 2025, metrics are presented on a segment-level basis.

For the year ended December 31, 2025, Software & Data segment revenue was $92.9 million. For the year ended December 31, 2024, Software & Data segment revenue was $89.2 million. The increase in revenue was driven by additional transaction volume of our Home Factors product and price increases of our title insurance software.

For the year ended December 31, 2025, Software & Data segment gross profit was $67.2 million. For the year ended December 31, 2024, Software & Data segment gross profit was $65.4 million. The gross profit improvement correlated with the increase in Software & Data segment revenue.

Software & Data Adjusted EBITDA was $18.9 million for the year ended December 31, 2025, which improved compared to prior year due to strong cost control, including a reduction in workforce, lower professional fees, and lower rent expense.

Software & Data Adjusted EBITDA Margin increased to 20% for the year ended December 31, 2025, reflecting improved operational efficiency. Adjusted EBITDA Margin growth was driven by a reduction in operating costs from strong cost control, including a reduction in workforce, lower professional fees, and lower rent expense.

CONSUMER SERVICES

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(1)Consumer Services Adjusted EBITDA and Adjusted EBITDA Margin are non-GAAP measures. See Non-GAAP Financial Measures section.

(2)See Key Performance Measures and Operating Metrics for definitions of metrics. In 2025, metrics are presented on a segment-level basis.

For the year ended December 31, 2025, Consumer Services segment revenue was $68.4 million. For the year ended December 31, 2024, Consumer Services segment revenue was $69.1 million. The decrease in revenue was primarily driven by an increase in the average coverage period of our warranty products, resulting in revenue being recognized over a longer timeframe. The decrease in revenue was also driven by a strategic shift to lower-revenue services that yield higher profit in our moving businesses.

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Consumer Services gross profit was $58.2 million for the year ended December 31, 2025. For the year ended December 31, 2024, Consumer Services segment gross profit was $54.4 million. The increase in gross profit was primarily driven by a decrease in warranty claims and a shift to higher profit services in our moving businesses.

Consumer Services Adjusted EBITDA was $4.8 million for the year ended December 31, 2025, which decreased compared to prior year, and was primarily driven by an increase in direct mail marketing expense for new warranty products. This decrease was slightly offset but an increase in gross profit due to a decrease in the number of warranty claims and a shift to higher profit services in our moving businesses.

Consumer Services Adjusted EBITDA Margin decreased to 7% for the three months ended December 31, 2025, primarily driven by an increase in direct mail marketing expense for new warranty products, a decrease in monthly revenue related to longer coverage period of our warranty products and the shift to higher profit moving services.

CORPORATE

______________________________________

(1)Adjusted EBITDA Loss is a non-GAAP measure. See Non-GAAP Financial Measures section for definition.

Corporate expenses decreased for the year ended December 31, 2025, compared to the prior year. The decrease was driven primarily by lower professional fees and reduced reliance on third-party consultants as well as strong cost control across the business. Our cost control measures included centralizing administrative functions and shifting hiring to target lower-cost locations.

Key Performance Measures and Operating Metrics

In the management of these businesses, we identify, measure and evaluate various operating metrics. The key performance measures and operating metrics used in managing the businesses are discussed below. These key performance measures and operating metrics are not prepared in accordance with GAAP and may not be comparable to or calculated in the same way as other similarly titled measures and metrics used by other companies.

Insurance Services

Reciprocal Written Premium (“RWP”) — We define RWP as the total premium written by the Reciprocal for the face value of one year’s premium gross of cancellations, plus surplus contributions and policy fees, and before deductions for reinsurance in the period. RWP excludes the impact of cancellations and premiums ceded to reinsurers and includes surplus contributions and policy fees, and, therefore, should not be used as a substitute for revenue. We use RWP to manage the business because we believe it represents the business volume generated by associated customer acquisition activities and is reflective of the competitive market position when evaluated on a per written policy basis and is a key driver of both Porch and the Reciprocal’s growth and profit opportunities.

Reciprocal Policies Written — We define Reciprocal Policies Written as the number of new and renewal insurance policies written during the period by the Reciprocal Segment.

RWP per Policy Written — We define RWP per Policy Written as the RWP in the period, which is reflective of the total amount a policyholder is expected to pay, divided by the Reciprocal Policies Written in the period.

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Software & Data

Average Number of Companies — We define Average Number of Companies as the average number of companies during the period across all of our Software & Data segment. This only includes the number of companies in our Software & Data segment.

Annualized Average Revenue per Company — We define Annualized Average Revenue per Company as the revenue generated across the Software & Data segment in the period over the Average Number of Companies in the period, which is then annualized (for example, for a given quarter, multiplied by 4).

Consumer Services

Monetized Services — We define Monetized Services as the total number of services from which we generated revenue, including, but not limited to, new and renewing warranty policies, completed moving jobs, sold security, TV/Internet or other home projects, measured over the period. This only includes services from Consumer Services segment and does not include insurance policies sold.

Average Revenue per Monetized Service — We define Average Revenue per Monetized Service as total Consumer Services segment revenue generated in the period over the number of Monetized Services.

Change in Key Performance Indicator

Effective beginning with the quarter ended September 30, 2025, we updated the definition of an operational metric, RWP, to include surplus contributions to the Reciprocal and policy fees. Management believes the revised definition reflects the total amount the policyholder is expected to pay and provides better insight to management. The primary reason for the change was the then-anticipated launch of the Porch Insurance product, where policyholders will pay a 10% surplus contribution in addition to traditional premium and fees. The updated definition ensures RWP aligns the operating metric with the full economic payment expected from the policyholder. The change in calculation methodology and updated definition did not result in a significant or material difference to the reported figures as compared to the definition utilized in prior quarters.

Liquidity and Capital Resources

In our early years, we raised capital primarily through equity investments. As a publicly traded company, we have relied on convertible debt as our primary source of capital. As of December 31, 2025, and 2024, we had $475.1 million and $507.3 million, respectively, of aggregate principal amount outstanding in convertible notes and promissory notes.

Based on our current operating and growth plan, management believes cash and cash equivalents and liquid investments at December 31, 2025, are sufficient to finance our operations, planned capital expenditures, working capital requirements and debt service obligations for at least the next 12 months. As our operations evolve and continue our growth strategy, including through acquisitions, we may elect or need to obtain alternative sources of capital, and we may finance additional liquidity needs in the future through one or more equity or debt financings. We may not be able to obtain equity or additional debt financing in the future when needed or, if available, the terms may not be satisfactory to us or could be dilutive to its stockholders.

We may, at any time and from time to time, seek to retire or purchase our outstanding debt or equity through cash purchases and/or exchanges for equity or debt, in open-market purchases, privately negotiated transactions or otherwise. Such repurchases or exchanges, if any, will be upon such terms and at such prices as we may determine, and will depend on prevailing market conditions, liquidity requirements, contractual restrictions and other factors. The amounts involved may be material.

We incurred net losses historically, resulting in an accumulated deficit at December 31, 2025 and 2024, totaling $648.3 million and $754.9 million, respectively.

Porch Group, Inc., is a holding company that transacts a majority of its business through operating subsidiaries, including subsidiaries that are involved in providing reinsurance and management services for the Reciprocal, which is an insurance carrier. Consequently, our ability to pay dividends and expenses is largely dependent on dividends or other distributions from our subsidiaries. The insurance industry is highly regulated, and insurance businesses are restricted by statute as to the amount of dividends they may pay without the prior approval of regulatory authorities.

Since the date of our incorporation, we have not engaged in any off-balance sheet arrangements, as defined in the rules and regulations of the SEC.

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Liquidity and Capital Resources of Porch Shareholder Interest

The following table provides the components of cash and cash equivalents, restricted cash and cash equivalents, and investments of Porch Shareholder Interest.

2026 Convertible Senior Notes

In September 2021, we completed a private offering of $425.0 million aggregate principal amount of 0.75% Convertible Senior Notes due on September 15, 2026 (the “2026 Notes”). As of December 31, 2025, the outstanding principal was $7.8 million. The 2026 Notes are redeemable at our option after September 20, 2024. We may redeem for cash all or any portion of the 2026 Notes, at our option, on or after September 20, 2024, if the last reported sale price of the common stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which we provide a notice of redemption, at a redemption price equal to 100% of the principal amount of the 2026 Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. No sinking fund is provided for the 2026 Notes. The 2026 Notes are convertible at an initial conversion rate of 39.9956 shares of common stock per one thousand dollars principal amount of 2026 Notes, which is equivalent to an initial conversion price of approximately $25.00 per share of common stock (the “2026 Note Conversion Rate”). The 2026 Note Conversion Rate is subject to customary adjustments for certain events as described in the indenture governing the 2026 Notes. We may settle the conversion option obligation with cash, shares of our common stock, or any combination of cash and shares of our common stock. Holders of the 2026 Notes may convert the 2026 Notes at their option (in whole or in part) on or after June 15, 2026, until the close of business on the second trading day immediately preceding the maturity date of September 15, 2026. In addition, holders of the 2026 Notes may convert the 2026 Notes at their option (in whole or in part) at any time prior to the close of business on the business day immediately preceding June 15, 2026, only under certain circumstances described in Note 9, Debt, of the Notes to Consolidated Financial Statements included in “Item 8. Financial Statements and Supplementary Data” of this Annual Report.

2028 Convertible Senior Notes

In April 2023, we issued $333.3 million of 6.75% Senior Secured Convertible Notes due in 2028 in a private placement transaction (the “2028 Notes”). We used a portion of the net proceeds from these 2028 Notes to repurchase $200.0 million of the 2026 Notes and to fund the repayment of the term loan facility, in each case plus accrued and unpaid interest thereon and related fees and expenses. As of December 31, 2025, the outstanding principal was $333.3 million. The 2028 Notes are convertible into cash, shares of common stock, or a combination of cash and shares of common stock at our election at an initial conversion rate of 39.9956 shares of common stock per one thousand dollars principal amount of the 2028 Notes, which is equivalent to an initial conversion price of approximately $25.00 per share.

The 2028 Notes will mature on October 1, 2028, unless earlier repurchased, redeemed or converted. Each note holder has the right to require us to repurchase for cash at 100% of par value, plus accrued and unpaid interest, all of such holder’s notes on each of September 15, 2027, and March 15, 2028; provided, however, that the aggregate principal amount repurchased on each such date by all holders shall not exceed the lesser of (1) $15.0 million and (ii) 5.0% of the aggregate principal amount of the 2028 Notes outstanding on such date.

Prior to the close of business on the business day immediately preceding July 1, 2028, the 2028 Notes will be convertible at the option of the holders only upon the satisfaction of certain conditions and during certain periods. Thereafter, until the

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close of business on the second scheduled trading day immediately preceding the maturity date, the 2028 Notes will be convertible at the option of the holders at any time regardless of these conditions.

2030 Convertible Senior Notes

In May 2025, we completed a series of privately negotiated refinancing transactions. As part of these transactions we exchanged $96.8 million aggregate principal amount of 2026 Notes for $83.0 million of newly issued 9.00% Convertible Senior Notes due in 2030 (“2030 Notes”) and issued an additional $51.0 million aggregate principal amount of 2030 Notes to the same investors that participated in the exchange, for a total aggregate principal amount of $134.0 million of 2030 Notes. As of December 31, 2025, the outstanding principal was $134.0 million. We used a portion of the net proceeds from these 2030 Notes to repurchase $47.5 million aggregate principal amount of 2026 Notes for $47.3 million in cash. The 2030 Notes are convertible in cash, shares of common stock, or a combination of cash and shares of common stock at our election at an initial conversion rate of 63.6333 shares of common stock per one thousand dollars principal amount of the 2030 Notes, which is equivalent to an initial conversion price of $15.71 per share of common stock (the “2030 Note Conversion Rate”). The 2030 Note Conversion Rate is subject to customary adjustments for certain events as described in the indenture governing the 2030 Notes.

The 2030 Notes will mature on May 15, 2030, unless earlier repurchased, redeemed, or converted. Holders of the 2030 Notes may convert the 2030 Notes at their option (in whole or in part) on or after February 15, 2030, until the close of business on the second trading day immediately preceding the maturity date of May 15, 2030. In addition, holders of the 2030 Notes may convert the 2030 Notes at their option (in whole or in part) at any time prior to the close of business on the business day immediately preceding February 15, 2030, only under certain circumstances described in Note 9, Debt, of the Notes to Consolidated Financial Statements included in “Item 8. Financial Statements and Supplementary Data” of this Annual Report.

Liquidity and Capital Resources of the Reciprocal (Consolidated VIE)

The following table provides the components of cash and cash equivalents, restricted cash and cash equivalents, and investments of the Reciprocal.

______________________________________

(1)Excludes 18.3 million shares of common stock held by HOA as of December 31, 2024, and held by the Reciprocal as of December 31, 2025 (following the distribution of such shares to the Reciprocal in connection with the sale of HOA to the Reciprocal in the first quarter of 2025).

(2)See Note 1 in the Notes to Consolidated Financial Statements for a description of the nature of restrictions.

As of December 31, 2025, the Reciprocal had $155.1 million in total statutory surplus and $289.4 million in total statutory surplus combined with non-admitted assets. Insurance companies in the United States are required by state law to maintain a minimum level of policyholder’s surplus. Insurance regulators in the states in which the Reciprocal operates have a risk-based capital standard designed to identify property and casualty insurers, or reinsurers, that may be inadequately capitalized based on inherent risks of the insurer’s assets and liabilities and its mix of net written premium. Insurers falling below a calculated threshold may be subject to varying degrees of regulatory action. See Note 16 in the Notes to Consolidated Financial Statements for a description of our reinsurance programs.

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Cash Flow Information

The following table provides a summary of consolidated cash flow information for the years ended December 31, 2025 and 2024.

Operating Cash Flows

Net cash provided by operating activities was $66.4 million for the year ended December 31, 2025. Net cash provided by operating activities was primarily driven by operating income and the collection in the current year of resinsurance receivables from the prior year.

Net cash used in operating activities was $31.7 million for the year ended December 31, 2024. Net cash used in operating activities includes cash outflows to cover losses from severe weather during the year, timing of working capital disbursements, and interest on convertible debt. These outflows of cash were partially offset by positive cash flow from the non-recurring cash receipt of $25 million related to the Aon agreement (see Note 16 in the Notes to the Consolidated Financial Statements).

Investing Cash Flows

Net cash used in investing activities was $71.9 million for the year ended December 31, 2025. Net cash used in investing activities is primarily related to purchases of investments of $148.3 million and investments to develop internal-use software of $13.9 million. This was partly offset by the cash inflows related to maturities and sales of investments of $89.6 million.

Net cash used in investing activities was $45.1 million for the year ended December 31, 2024. Net cash used in investing activities is primarily related to purchases of investments of $110.9 million and investments to develop internal-use software of $12.3 million. This was partly offset by the cash inflows related to maturities and sales of investments of $67.8 million.

Financing Cash Flows

Net cash used in financing activities was $22.2 million for the year ended December 31, 2025. Net cash used in financing activities is primarily related to $68.2 million of repurchases of 2026 Notes. We also incurred $2.2 million in debt issuance costs associated with the issuance of the 2030 Notes. These outflows were partially offset by $51.0 million in proceeds from the issuance of the 2030 Notes.

Net cash used in financing activities was $23.7 million for the year ended December 31, 2024. Net cash used in financing activities is primarily related to the repurchase of the 2026 Notes of $23.4 million.

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Supplemental Cash Flow Information

The following table provides further detail of cash flows of Porch and cash flows of the Reciprocal Segment for the twelve months ended December 31, 2025.

______________________________________

(1)Porch Shareholder Interest net cash provided by (used in) operating, investing, and financing activities are non-GAAP measures. See Non-GAAP Financial Measures section. This table reconciles these non-GAAP measures to the nearest GAAP measures in the “Consolidated” column.

Non-GAAP Financial Measures

This Annual Report includes non-GAAP financial measures, such as Adjusted EBITDA (Loss), Adjusted EBITDA (Loss) Margin, Adjusted EBITDA % of RWP, Attritional Loss Ratio, and certain amounts related to Porch Shareholder Interest.

Our management uses these non-GAAP financial measures as supplemental measures of our operating and financial performance, for internal budgeting and forecasting purposes, to evaluate financial and strategic planning matters, and to establish certain performance goals for incentive programs. We believe that the use of these non-GAAP financial measures provides investors with useful information to evaluate our operating and financial performance and trends and in comparing our financial results with competitors, other similar companies and companies across different industries, many of which present similar non-GAAP financial measures to investors. However, our definitions and methodology in calculating these non-GAAP measures may not be comparable to those used by other companies. In addition, we may modify the presentation of these non-GAAP financial measures in the future, and any such modification may be material.

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You should not consider these non-GAAP financial measures in isolation, as a substitute to or superior to financial performance measures determined in accordance with GAAP. The principal limitation of these non-GAAP financial measures is that they exclude specified income and expenses, some of which may be significant or material, that are required by GAAP to be recorded in our consolidated financial statements. We may also incur future income or expenses similar to those excluded from these non-GAAP financial measures, and the presentation of these measures should not be construed as an inference that future results will be unaffected by unusual or non-recurring items. In addition, these non-GAAP financial measures reflect the exercise of management judgment about which income and expenses are included or excluded in determining these non-GAAP financial measures.

Adjusted EBITDA (Loss)

We define Adjusted EBITDA (Loss) as net income (loss) adjusted for net income (loss) attributable to the Reciprocal; interest expense; income taxes; depreciation and amortization; gain or loss on extinguishment of debt; other expense; other income; impairments of intangible assets and goodwill; gain or loss on reinsurance contract; impairments of property, equipment, and software; stock-based compensation expense; mark-to-market gains or losses recognized on changes in the value of contingent consideration arrangements, unexercised warrants, and derivatives; restructuring and other costs; acquisition and other transaction costs; and non-cash bonus expense. Adjusted EBITDA (Loss) Margin is defined as Adjusted EBITDA (Loss) divided by revenue. Adjusted EBITDA % of RWP is defined as Insurance Services Adjusted EBITDA divided by RWP.

The following table reconciles Net income (loss) to Adjusted EBITDA (Loss) and Net income (loss) as a percentage of Porch Shareholder Interest Revenue to Adjusted EBITDA (Loss) Margin.

Our segment operating and financial performance measures are Gross Profit and Adjusted EBITDA (Loss) for the Insurance Services, Software & Data, and Consumer Services segments. Adjusted EBITDA (Loss) is defined as Gross Profit less the following expenses associated with each segment: selling and marketing, product and technology, and general and administrative. Adjusted EBITDA (Loss) also excludes non-cash items or items that management does not consider reflective of ongoing core operations, such as depreciation, amortization, and stock-based compensation expense. Adjusted EBITDA (Loss) Margin for each segment is defined as Adjusted EBITDA (Loss) for the segment divided by the segment’s revenue. Adjusted EBITDA % of RWP is defined as Insurance Services Adjusted EBITDA divided by RWP.

We believe that presenting Adjusted EBITDA % of RWP provides useful information to investors by illustrating the profitability and operating efficiency of the Insurance Services segment relative to insurance premium volume. Because the Insurance Services segment earns economics primarily through fees, commissions, and ceding arrangements rather than

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underwriting risk, management uses this measure to facilitate evaluation of unit economics, scalability, and comparability across periods.

The following table reconciles Gross Profit to Adjusted EBITDA (Loss), Gross Margin to Adjusted EBITDA (Loss) Margin, and Gross Profit as a percentage of RWP to Adjusted EBITDA % of RWP for the Insurance Services segment.

The following table reconciles Gross Profit to Adjusted EBITDA (Loss) and Gross Margin to Adjusted EBITDA (Loss) Margin for the Software & Data segment.

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The following tables reconcile Gross Profit to Adjusted EBITDA (Loss) and Gross Margin to Adjusted EBITDA (Loss) Margin for the Consumer Services segment.

The impact of corporate expenses on Adjusted EBITDA (Loss) is also a non-GAAP financial measure. Reconciliations of these non-GAAP financial measures to the nearest GAAP measure are included in the Consolidated Results of Operations section.

Attritional Loss Ratio

The Attritional Loss Ratio is calculated by deducting the Gross Loss Ratio related to catastrophic weather events from total Gross Loss Ratio. Catastrophic weather events include, without limitation, hurricanes, tornados, earthquakes, hailstorms, wildfires, high winds, and winter storms. We believe the Attritional Loss Ratio is useful to investors and use this financial measure to reveal trends in the Reciprocal’s Gross Loss Ratio that may be obscured by catastrophe losses as such events cannot be accurately predicted and may cause the Reciprocal’s Gross Loss Ratio to vary significantly between periods as a result of their incidence of occurrence and magnitude. The Reciprocal has adopted the industry-wide catastrophe classifications of storms and other events published by Insurance Services Office, Inc. (“ISO”) to track and report losses related to catastrophes. ISO classifies an event as a catastrophe when the event causes $25 million or more in direct losses. The following table reconciles Gross Loss Ratio to Attritional Loss Ratio.

Porch Shareholder Interest

Certain amounts related to Porch Shareholder Interest are non-GAAP financial measures. We define Porch Shareholder Interest as the Insurance Services, Software & Data, and Consumer Services segments, together with corporate expenses.

The operating results of these segments comprise “Net loss attributable to Porch” in our Consolidated Statements of Operations and Comprehensive Income (Loss). Reconciliations of the following non-GAAP financial measures to the nearest GAAP measure are included in the Consolidated Results sections:

•Porch Shareholder Interest Adjusted EBITDA (Loss)

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•Porch Shareholder Interest Cost of Revenue

•Porch Shareholder Interest Depreciation and Amortization

•Porch Shareholder Interest General and Administrative

•Porch Shareholder Interest Gross Margin

•Porch Shareholder Interest Gross Profit

•Porch Shareholder Interest Income (Loss) Before Income Taxes

•Porch Shareholder Interest Income Tax Benefit (Provision)

•Porch Shareholder Interest Interest Expense

•Porch Shareholder Interest Mark-to-Market Losses (Gains)

•Porch Shareholder Interest Operating Income (Loss)

•Porch Shareholder Interest Other Expense (Income)

•Porch Shareholder Interest Other Gains and Losses

•Porch Shareholder Interest Product and Technology

•Porch Shareholder Interest Provision for Doubtful Accounts

•Porch Shareholder Interest Revenue

•Porch Shareholder Interest Selling and Marketing

•Porch Shareholder Interest Stock-based Compensation Expense

Reconciliations of the following non-GAAP financial measures to the nearest GAAP measure are included in the Liquidity and Capital Resources section:

•Porch Shareholder Interest net cash provided by (used in) financing activities

•Porch Shareholder Interest net cash provided by (used in) investing activities

•Porch Shareholder Interest net cash provided by (used in) operating activities

Contractual Obligations and Commitments

In addition to debt service payments, our principal commitments consist of obligations under leases for office space. For more information regarding our lease obligations, see Note 15, Leases, of the Notes to Consolidated Financial Statements included in “Item 8. Financial Statements and Supplementary Data” of this Annual Report. In addition, we have a substantial level of debt. For more information regarding our debt service obligations, see Note 9, Debt, of the Notes to Consolidated Financial Statements. We also have certain non-cancellable purchase commitments primarily for data purchases. As of December 31, 2025, our other contractual commitments associated with agreements that are enforceable and legally binding and that specify all significant terms were payments of $5.6 million due in the next 12 months and $9.3 million due thereafter. For more information regarding our purchase commitments, see Note 19, Commitments and Contingencies, of the Notes to Consolidated Financial Statements. We expect to fund these obligations with cash flows from operations and cash on our balance sheet.

We have made and expect to continue to make additional investments in our infrastructure to scale our operations and increase productivity. We plan to enhance the consumer experience, our app and digital platform and integration of data platform across Porch, to invest in development of additional modules across all vertical software businesses and to enhance our corporate systems.

Recent Accounting Pronouncements

See Note 1, Description of Business and Summary of Significant Accounting Policies, of the Notes to Consolidated Financial Statements included in “Item 8. Financial Statements and Supplementary Data” of this Annual Report, for more information about recent accounting pronouncements, the timing of their adoption, and our assessment, to the extent we have made one, of their potential impact on our financial condition and our results of operations.

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