"Since 2021, we've delivered more than $500 million in discretionary profit, growing at a 22% CAGR, including over $150 million last year alone," said Margi Tooth, Chief Executive Officer and President of Trupanion. "In 2025, we achieved our 15% annual margin target, while increasing subscription revenue and reinvesting record profits to drive four straight quarters of higher retention and accelerating gross pet adds. We're poised to advance confidently into our next strategic plan."
Fourth Quarter 2025 Financial and Business Highlights
Total revenue was $376.9 million, an increase of 12% compared to the fourth quarter of 2024.
Total enrolled pets (including pets from our other business segment) was 1,647,565 at December 31, 2025, a decrease of 2% over December 31, 2024.
Subscription business revenue was $261.4 million, an increase of 15% compared to the fourth quarter of 2024.
Subscription enrolled pets was 1,096,173 at December 31, 2025, an increase of 5% over December 31, 2024.
Net income was $5.6 million, or $0.13 per basic and diluted share, compared to a net income of $1.7 million, or $0.04 per basic and diluted share, in the fourth quarter of 2024.
Adjusted EBITDA was $21.8 million, compared to adjusted EBITDA of $19.4 million in the fourth quarter of 2024.
Operating cash flow was $29.3 million and free cash flow was $25.3 million in the fourth quarter of 2025. This compared to operating cash flow of $23.7 million and free cash flow of $21.8 million in the fourth quarter of 2024.
Full Year 2025 Financial and Business Highlights
Total revenue was $1,439.3 million, an increase of 12% compared to 2024.
Subscription business revenue was $989.3 million, an increase of 16% compared to 2024.
Net income was $19.4 million, or $0.45 per basic and diluted share, compared to a net loss of $(9.6) million, or $(0.23) per basic and diluted share, in 2024. Net income included a realized gain of $7.8 million from the exchange of a preferred stock investment for intellectual property in 2025.
Adjusted EBITDA was $70.1 million, compared to adjusted EBITDA of $46.1 million in 2024.
Operating cash flow was $89.5 million and free cash flow was $75.4 million in 2025. This compared to operating cash flow of $48.3 million and free cash flow of $38.6 million in 2024.
At December 31, 2025, the Company held $370.7 million in cash and short-term investments, including $50.0 million held outside the insurance entities, with an additional $5.0 million available under its credit facility.
Conference CallTrupanion's management will host a conference call today to review its fourth quarter and full year 2025 results. The call is scheduled to begin shortly after 1:30 p.m. PT/ 4:30 p.m. ET. A live webcast will be accessible through the Investor Relations section of Trupanion's website at https://investors.trupanion.com/ and will be archived online for 3 months upon completion of the conference call. Participants can access the conference call by dialing 1-844-676-1342 (United States) or 1-412-634-6683 (International). A telephonic replay of the call will also be available after the completion of the call, by dialing 1-844-512-2921 (United States) or 1-412-317-6671 (International) and entering the replay pin number: 10204830.
About TrupanionTrupanion is a leader in medical insurance for cats and dogs throughout the United States, Canada, and certain countries in Continental Europe with over 1,000,000 pets currently enrolled. For over two decades, Trupanion has given pet owners peace of mind so they can focus on their pet's recovery, not financial stress. Trupanion is committed to providing pet parents with the highest value in pet medical insurance with unlimited payouts on eligible expenses for the life of their pets. With its patented process, Trupanion is the only North American provider with the technology to pay veterinarians directly in seconds at the time of checkout. Trupanion is listed on NASDAQ under the symbol "TRUP". The company was founded in 2000 and is headquartered in Seattle, WA. Trupanion policies are issued, in the United States, by its wholly-owned insurance entity American Pet Insurance Company or ZPIC Insurance Company and, in Canada, by its wholly-owned insurance entity GPIC Insurance Company or by Accelerant Insurance Company of Canada. Policies are sold and administered in Canada by Canada Pet Health Insurance Services, Inc. dba Trupanion and in the United States by Trupanion Managers USA, Inc. (CA license No. 0G22803, NPN 9588590). Canada Pet Health Insurance Services, Inc. is a registered damage insurance agency and claims adjuster in Quebec #603927. For more information, please visit trupanion.com.
Forward-Looking StatementsThis press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 relating to, among other things, expectations, plans, prospects and financial results for Trupanion, including, but not limited to, its expectations regarding its ability to continue to grow its enrollments and revenue, and otherwise execute its business plan. These forward-looking statements are based upon the current expectations and beliefs of Trupanion's management as of the date of this press release, and are subject to certain risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. All forward-looking statements made in this press release are based on information available to Trupanion as of the date hereof, and Trupanion has no obligation to update these forward-looking statements.
In particular, the following factors, among others, could cause results to differ materially from those expressed or implied by such forward-looking statements: the ability to achieve or maintain profitability and/or appropriate levels of cash flow in future periods; the ability to keep growing our membership base and revenue; the accuracy of assumptions used in determining appropriate member acquisition expenditures; the severity and frequency of claims; the ability to maintain high retention rates; the accuracy of assumptions used in pricing medical plan subscriptions and the ability to accurately estimate the impact of new products or offerings on claims frequency; actual claims expense exceeding estimates; regulatory and other constraints on the ability to institute, or the decision to otherwise delay, pricing modifications in response to changes in actual or estimated claims expense; the effectiveness and statutory or regulatory compliance of our Territory Partner model and of our Territory Partners, veterinarians and other third parties in recommending medical plan subscriptions to potential members; the ability to retain existing Territory Partners and increase the number of Territory Partners and active hospitals; compliance by us and those referring us members with laws and regulations that apply to our business, including the sale of a pet medical plan; the ability to maintain the security of our data; fluctuations in currency exchange rates; the ability to protect our proprietary and member information; the ability to maintain our culture and team; the ability to maintain the requisite amount of risk-based capital; our ability to implement and maintain effective controls; the ability to protect and enforce Trupanion's intellectual property rights; the ability to successfully implement our alliance with Aflac; the ability to continue key contractual relationships with third parties; third-party claims including litigation and regulatory actions; the ability to recognize benefits from investments in new solutions and enhancements to Trupanion's technology platform and website; our ability to retain key personnel; and deliberations and determinations by the Trupanion board based on the future performance of the company or otherwise.
For a detailed discussion of these and other cautionary statements, please refer to the risk factors discussed in filings with the Securities and Exchange Commission (SEC), including but not limited to, Trupanion's Annual Report on Form 10-K for the year ended December 31, 2025 and any subsequently filed reports on Forms 10-Q, 10-K and 8-K. All documents are available through the SEC's Electronic Data Gathering Analysis and Retrieval system at https://www.sec.gov or the Investor Relations section of Trupanion's website at https://investors.trupanion.com.
Non-GAAP Financial MeasuresTrupanion's stated results include certain non-GAAP financial measures. These non-GAAP financial measures may not provide information that is directly comparable to that provided by other companies in its industry as other companies in its industry may calculate or use non-GAAP financial measures differently. In addition, there are limitations in using non-GAAP financial measures because the non-GAAP financial measures are not prepared in accordance with GAAP, may be different from non-GAAP financial measures used by other companies and exclude expenses that may have a material impact on Trupanion's reported financial results. The presentation and utilization of non-GAAP financial measures is not meant to be considered in isolation or as a substitute for the directly comparable financial measures prepared in accordance with GAAP. Trupanion urges its investors to review the reconciliation of its non-GAAP financial measures to the most directly comparable GAAP financial measures in its consolidated financial statements, and not to rely on any single financial or operating measure to evaluate its business. These reconciliations are included below and on Trupanion's Investor Relations website.
Because of varying available valuation methodologies, subjective assumptions and the variety of equity instruments that can impact a company's non-cash expenses, Trupanion believes that providing various non-GAAP financial measures that exclude stock-based compensation expense and depreciation and amortization expense allows for more meaningful comparisons between its operating results from period to period. Trupanion offsets new pet acquisition expense with sign-up fee revenue in the calculation of net acquisition cost because it collects sign-up fee revenue from new members at the time of enrollment and considers it to be an offset to a portion of Trupanion's new pet acquisition expense. Trupanion believes this allows it to calculate and present financial measures in a consistent manner across periods. Trupanion's management believes that the non-GAAP financial measures and the related financial measures derived from them are important tools for financial and operational decision-making and for evaluating operating results over different periods of time.
Trupanion, Inc.Condensed Consolidated Statements of Operations(in thousands, except share data)
Three Months Ended December 31,
Year Ended December 31,
2025
2024
2025
2024
(unaudited)
Revenue:
Subscription business
$
261,422
$
227,783
$
989,338
$
856,521
Other business
115,431
109,524
449,967
429,163
Total revenue
376,853
337,307
1,439,305
1,285,684
Cost of revenue:
Subscription business(1)
204,782
181,614
790,880
706,851
Other business
107,044
102,770
417,414
400,035
Total cost of revenue(1), (2)
311,826
284,384
1,208,294
1,106,886
Operating expenses:
Technology and development(1)
11,303
8,172
37,848
31,255
General and administrative(1)
18,323
16,828
76,648
63,731
Sales and marketing(1)
23,103
18,354
85,408
71,379
Goodwill impairment charges
1,129
5,299
1,129
5,299
Depreciation and amortization
4,032
3,924
15,836
16,466
Total operating expenses
57,890
52,577
216,869
188,130
Gain (loss) from investment in joint venture
—
2
(305
)
(182
)
Operating income (loss)
7,137
348
13,837
(9,514
)
Interest expense
4,076
3,427
13,759
14,498
Other (income), net
(3,232
)
(4,773
)
(21,916
)
(14,374
)
Income (loss) before income taxes
6,293
1,694
21,994
(9,638
)
Income tax expense (benefit)
663
38
2,561
(5
)
Net income (loss)
$
5,630
$
1,656
$
19,433
$
(9,633
)
Net income (loss) per share:
Basic
$
0.13
$
0.04
$
0.45
$
(0.23
)
Diluted
$
0.13
$
0.04
$
0.45
$
(0.23
)
Weighted average shares of common stock outstanding:
Basic
42,281,757
42,402,323
42,958,654
42,158,773
Diluted
43,572,375
42,903,536
43,555,884
42,158,773
(1)Includes stock-based compensation expense as follows:
Three Months Ended December 31,
Year Ended December 31,
2025
2024
2025
2024
Veterinary invoice expense
$
620
$
677
$
2,841
$
3,460
Other cost of revenue
605
585
2,284
2,063
Technology and development
1,710
1,705
6,036
7,279
General and administrative
5,025
4,971
19,571
4,934
New pet acquisition expense
1,567
1,561
7,580
15,696
Total stock-based compensation expense
$
9,527
$
9,499
$
38,312
$
33,432
(2)The breakout of cost of revenue between veterinary invoice expense and other cost of revenue is as follows:
Three Months Ended December 31,
Year Ended December 31,
2025
2024
2025
2024
Veterinary invoice expense
$
262,818
$
245,663
$
1,028,975
$
949,148
Other cost of revenue
49,008
38,721
179,319
157,738
Total cost of revenue
$
311,826
$
284,384
$
1,208,294
$
1,106,886
Trupanion, Inc.Condensed Consolidated Balance Sheets(in thousands, except share data)
December 31,2025
December 31,2024
(unaudited)
Assets
Current assets:
Cash and cash equivalents
$
138,024
$
160,295
Short-term investments
232,706
147,089
Accounts and other receivables, net of allowance for doubtful accounts of $1,311 at December 31, 2025 and $1,117 at December 31, 2024
301,945
274,031
Prepaid expenses and other assets
18,387
15,912
Total current assets
691,062
597,327
Restricted cash
33,434
39,235
Long-term investments
983
373
Property, equipment, and internal-use software, net
104,844
102,191
Other long-term assets
21,237
17,579
Intangible assets, net
24,102
13,177
Goodwill
39,382
36,971
Total assets
$
915,044
$
806,853
Liabilities and stockholders' equity
Current liabilities:
Accounts payable
$
16,445
$
11,532
Accrued liabilities and other current liabilities
56,509
33,469
Reserve for veterinary invoices
55,921
51,635
Deferred revenue
270,935
251,640
Long-term debt - current portion
10,000
1,350
Total current liabilities
409,810
349,626
Long-term debt
101,784
127,537
Deferred tax liabilities
1,510
1,946
Other liabilities
18,004
4,476
Total liabilities
531,108
483,585
Stockholders' equity:
Common stock: $0.00001 par value per share, 100,000,000 shares authorized; 44,430,267 and 43,402,081 shares issued and outstanding at December 31, 2025; 43,516,631 and 42,488,455 shares issued and outstanding at December 31, 2024
—
—
Preferred stock: $0.00001 par value per share, 10,000,000 shares authorized; no shares issued and outstanding
—
—
Additional paid-in capital
604,828
568,302
Accumulated other comprehensive income (loss)
2,097
(2,612
)
Accumulated deficit
(206,455
)
(225,888
)
Treasury stock, at cost: 1,028,186 shares at December 31, 2025 and 2024
(16,534
)
(16,534
)
Total stockholders' equity
383,936
323,268
Total liabilities and stockholders' equity
$
915,044
$
806,853
Trupanion, Inc.Condensed Consolidated Statements of Cash Flows(in thousands)
Three Months Ended December 31,
Year Ended December 31,
2025
2024
2025
2024
(unaudited)
Operating activities
Net income (loss)
$
5,631
$
1,656
$
19,433
$
(9,633
)
Adjustments to reconcile net income (loss) to cash provided by operating activities:
Depreciation and amortization
4,032
3,924
15,836
16,466
Stock-based compensation expense
9,527
8,294
38,312
33,432
Realized gain on nonmonetary exchange of preferred stock investment
—
—
(7,783
)
—
Goodwill impairment charges
1,129
5,299
1,129
5,299
Other, net
934
(1,294
)
2,097
(1,748
)
Changes in operating assets and liabilities:
Accounts and other receivables
715
15,303
(27,211
)
(6,717
)
Prepaid expenses and other assets
(626
)
817
