Verisk Analytics, Inc.

Good day, everyone, and welcome to the various fourth quarter 2025 earnings results conference call. This call is being recorded. Currently, all participants are in a listen-only mode. After today's prepared remarks, we will conduct a question and answer session where we will limit participants to one question so that we can allow everyone to ask a question. We will have further instructions for you at that time. For opening remarks and introductions, I would like to turn the call over to various Head of Investor Relations, Ms. Stacey Broadbar. Ms. Broadbar, please go ahead.

Thank you, Operator, and good day, everyone. We appreciate you joining us today for a discussion of our fourth quarter 2025 financial results. On the call today are Lee Schabel, Verisk's President and Chief Executive Officer, and Elizabeth Mann, Chief Financial Officer. The earnings release referenced on this call, as well as our traditional quarterly earnings presentation and the associated 10K, can be found in the investor section of our website, Verisk.com. The earnings release has also been attached to an 8K that we have furnished to the SEC. A replay of this call will be available for 30 days on our website and by dial-in. As set forth in more detail in today's earnings release, I will remind everyone that today's call may include forward-looking statements about Verisk's future performance, including those related to our financial guidance. Actual performance could differ materially from what is suggested by our comments today. Information about the factors that could affect future performance is contained in our recent SEC filing. A reconciliation of reported and historic Non-GAAP financial measures discussed on this call is provided in our 8K and today's earnings presentation posted on the investor section of our website, Verisk.com. However, we are not able to provide a reconciliation of a projected adjusted EBITDA and adjusted EBITDA margin to the most directly comparable expected GAAP results because of the unreasonable effort and high unpredictability of estimating certain items that are excluded from projected non-GAAP adjusted EBITDA and adjusted EBITDA margin, including, for example, tax consequences, acquisition-related costs, gains and losses from dispositions, and other non-recurring expenses, the effect of which may be significant. And now, I'd like to turn the call over to Lee Schabel.

Thanks, Stacey. Good morning, and thank you for taking the time to join us this morning. Today, I will provide a broad overview of our fourth quarter and full year 2025 results and portfolio actions, as well as our financial and strategic outlook for the year ahead. Elizabeth will give a more detailed view in our financial review. I will also offer recent perspective on our industry engagement, including client discussions around current operating environment and developments around the uses of advanced technologies, including the evolution of AI. Finally, I will finish with some updates on recent inventions we have introduced into the market to provide some context on how we are leveraging the demand and opportunity. Turning to the results, I am pleased to share that Verisk delivered solid financial results for 2025, marked by organic constant currency revenue growth of 6.6%, organic constant currency adjusted EBITDA growth of 8.5%, and strong free cash flow growth. This growth was in line with the guidance that we provided at the beginning of the year and was achieved despite some temporary headwinds, including a year of very low weather activity. The solid financial results in 2025 close out the three-year period with growth at or above the midpoint of the long-term expectations we set at Investor Day in 2023. As we look ahead, We continue to have confidence in delivering against our long-term growth targets based on the ongoing adoption of data and technology across the global insurance industry and our opportunity to support the needs of our clients and address their objectives with our distinct capabilities. Before we turn to the strategic discussion, I want to address the two portfolio actions taken at the end of the fourth quarter. We made the difficult decision to terminate the definitive agreement to purchase AccuLinks. We had strong conviction that the acquisition could create substantial value for the insurance ecosystem and would drive growth and generate strong returns on capital for Verisk. We went to great lengths and made extensive efforts to address FTC requests. That said, following the notice from the FTC that the review would be extended, the opportunity cost of waiting on the sidelines through a long, uncertain, and costly approval process was too high, given the rapidly evolving environment. Second, we sold Verisk marketing solutions during the quarter. This transaction is a demonstration of our ongoing active portfolio management and our commitment to focusing on data, analytics, and technology solutions for the global insurance industry. Turning to 2026, The insurance industry is healthy, coming off a strong 2025 marked by solid mid-single digit net written premium growth and consistently better year-over-year combined ratios, reflecting strong overall profitability. This is positive for the industry's interest and capability to adopt and integrate improved data, analytics, and technology into their businesses, particularly at a time when efficiency, better risk selection, and the adoption and integration of new technologies are top of mind. This is one of the reasons I am so pleased to share that Steve Kotterer has joined Verisk to lead our claims business. Steve brings with him valuable perspective and intensive expertise developed across his three decades of experience working as a consultant at firms including McKinsey, Bain, and most recently, EY Parthenon. Steve has focused on advising leading global carriers and brokers on transforming insurance industry workflows using data and technology, including AI, and will be instrumental in advancing our client engagement and building on our active partnership with the industry. Turning our attention to client engagement, we are in constant dialogue with our clients covering strategic and technological issues And over the last year, I've been part of many C-suite conversations with chief underwriting officers, chief risk officers, and chief claims officers to discuss their AI strategies and how they'd like to work with Verisk in adapting our data, analytics, and connectivity to their evolving needs. There are two common elements in these conversations. One, how can we continue to enhance the critical data that the industry overwhelmingly trusts us to provide, and two, How can we help support practical, safe, and regulatorily approved applications of evolving AI technologies with good ROIs? The unique nature of the insurance industry requires a massive amount of specific and representative data in order to ensure rate adequacy, evaluate claims fairly, promote competition and innovation, as well as satisfy the needs of regulators. High-quality data is critical for accuracy and effectiveness, and Verisk is in a unique position as one of very few providers who currently aggregate data from multiple sources, organize it, and normalize it in order to glean insights about risk at a granular level and include that in innovative products and services it files on behalf of our clients. In fact, Verisk submits over 2,000 regulatory product filings each year on behalf of our clients and our government relations teams interact with all 50 state regulators on a daily basis. And it is this data quality, breadth, and organization that is essential to effective AI deployment. We already have the data infrastructure in place and in many instances have AI tools built into associated workflows to enhance carrier accuracy and efficiency. In fact, We currently have more than 35 AI-powered projects and solutions for both internal and external purposes in use today, and we have plans to introduce many more throughout 2026. In order to illustrate this more concretely, I wanted to share one very specific description of our integration of the evolving range of AI technologies into our products, its adoption by our clients, and the unique strengths we bring to that process. I recently returned from our Elevate conference in Salt Lake City, where we bring together key participants in the claims process, including carriers, adjusters, contractors, and other ecosystem technology partners to discuss technology development and adoption for this professional community that's dedicated to helping policyholders recover from damage to their property. At the conference, we unveiled the next generation of our AI-enabled estimating products, ExactGen. This product builds on a progression of AI technology that started with ExactExpert, which we launched in 2023. ExactExpert uses rules-based logic and machine learning to assist estimators with identifying discrepancies in their estimates, providing advice on what questions should be asked, and correcting errors based on their employer's established rule set and experience. ExactXpert has been rapidly adopted industry-wide, including by seven of the top 10 homeowners insurers, and now serves tens of thousands of adjusters and estimators. At the conference, a major restoration contractor referred to ExactXpert as, quote, an industry game changer. The rapid adoption of the product relied on trust in our proprietary cost and repair data sets that underlies the technology, and that estimators rely on for their work, and the common process platform in Xactimate that connects industry professionals. We expanded our offering of advanced technologies in our property estimating solutions in October 2025 with the launch of XactAI, Exact AI applies generative AI to the production of initial estimates with content input from the ExactWare platform. As part of the conference, I hosted a fireside chat with the CEO of one of the leading adjusting firms who shared his excitement about the AI platform and shared that they are training thousands of their employees on the technology. Again, this solution builds on our established and proprietary data sets as well as the workflows relied upon by carrier claims professionals, independent adjusters, and contractors to smoothly settle and resolve a claim, ultimately benefiting policyholders. And now, with the addition of ExactGen, we are adding agentic AI to handle content gatherings from many sources, including aerial imagery providers, policyholder photos, and policy information from the carrier, amongst others. to generate near complete exterior and interior estimates, and to facilitate settlement and resolution with the involved parties. Not only does ExactGen benefit from the established network of carriers, contractors, and adjusters, but we are integrating data and content from the broader network of technology providers who we have incorporated into our ecosystem. This reduces the burden of onsite professionals because they are spending less time gathering and waiting for information and more time with the affected insured client, accelerating the pace of recovery. The feedback was enthusiastic about how this could improve efficiency and help reduce resolution times, which have long been challenges for the industry. I could take you through similar examples across our other businesses, but the themes and our competitive advantages would remain the same, namely, one, the critical value of our data sets to AI, two, an established industry process and domain expertise to innovate from, three, the importance of existing connectivity to multiple parties in the ecosystem, and four, the ability to invest in innovation at scale and deliver technology across a large installed base, providing an economic advantage to the client and a stronger return on invested capital. It is these same competitive advantages that we capitalized upon to create growth and value for the insurance industry through prior technology transformations, including digitization, cloud, and SaaS. As our 2025 results demonstrated, our business and economic model are strong as we crossed the $3 billion mark in revenue and delivered another year of solid growth and profitability, robust free cash flow generation, and strong returns on invested capital. We are well positioned to benefit from AI, drive new innovation, further connect the insurance ecosystem, and deliver growth in line with our long-term growth targets. We are energized by the opportunity that lies ahead and are looking forward to speaking about our plans in more detail at our investor day on March 5th. And now, I will turn the call over to Elizabeth.