Executive Summary

Total revenues from continuing operations were $62.8M, up 27% year over year, while consolidated Adjusted EBITDA to shareholders was a loss of $1.3M; results were driven by the inclusion of Beat Capital and offset by higher G&A, intangible amortization, and interest expense tied to the Beat acquisition .
Insurance Distribution (Cirrata) delivered $41.0M of revenue (+129% YoY) and $7.1M Adjusted EBITDA to shareholders (17.3% margin); Specialty P&C (Everspan) posted a 66.9% loss ratio (improved 880 bps YoY) but a higher expense ratio led to a 102.1% combined ratio .
Management emphasized a technology-focused shared service model with data and AI capabilities, a growing MGA pipeline, and reiterated its long-term goal of $80–$90M Adjusted EBITDA to common shareholders by 2028; regulatory approval for the legacy business sale remains the final step (Wisconsin OCI) .
Versus S&P Global consensus, Adjusted EPS missed: consensus -$0.07 vs actual -$0.13 for Q1 2025, reflecting Beat-related amortization/interest and holding company costs; revenue estimates were not available (thin coverage), but revenue actual was $62.8M. Values retrieved from S&P Global.

What Went Well and What Went Wrong

What Went Well
- Insurance Distribution scaled materially with Beat integration: revenue +129% to $41.0M and Adjusted EBITDA to shareholders +69% to $7.1M; several 2024 MGA launches are already profitable, and the pipeline remains strong .
- Everspan improved underwriting quality: loss ratio improved to 66.9% (-880 bps YoY); management expects expense ratio to trend favorably as the portfolio migrates and scales .
- Strategic clarity: management highlighted a differentiated platform (managed capacity, permanent capital, aligned partnerships, tech-led shared services with data/AI) and reiterated 2028 Adjusted EBITDA target of $80–$90M .
What Went Wrong
- Consolidated profitability: continuing operations posted a net loss to shareholders of $(16.1)M and Adjusted EBITDA to shareholders of $(1.3)M, reflecting higher G&A, intangible amortization, and interest linked to Beat .
- Everspan combined ratio rose to 102.1% (+370 bps YoY) due to higher expense ratio (35.2%), sliding scale commissions, and lower earned premium base .
- A&H/ESL headwinds: organic growth contracted 2% excluding Beat due to pullbacks in ESL and short-term medical amid industry turbulence; property pricing decelerated .

Financial Results

Metric	Q3 2024	Q4 2024	Q1 2025
Revenue – Continuing Ops ($USD Millions)	$70.0 (sum of Specialty P&C $40.1 + Distribution $24.0 + Corporate $5.9)	$65.2	$62.8
Adjusted EPS ($USD)	$(0.46)	$(0.12)	$(0.13)
Speciality P&C Combined Ratio (%)	100.5%	96.5%	102.1%
Speciality P&C Loss Ratio (%)	74.4%	51.9%	66.9%
Speciality P&C Expense Ratio (%)	26.1%	44.6%	35.2%

Segment breakdown – Q1 2025 vs Q1 2024

Segment Metric	Q1 2024	Q1 2025
Insurance Distribution Revenue ($USD Thousands)	$17,865	$40,998
Insurance Distribution Adjusted EBITDA to Shareholders ($USD Thousands)	$4,202	$7,112
Insurance Distribution Adjusted EBITDA Margin to Shareholders (%)	23.5%	17.3%
Insurance Distribution Pretax Income (Loss) to Shareholders ($USD Thousands)	$3,270	$(3,897)
Specialty P&C Total Revenue ($USD Thousands)	$29,542	$21,171
Specialty P&C Net Income ($USD Thousands)	$1,715	$1,425
Specialty P&C Adjusted EBITDA to Shareholders ($USD Thousands)	$1,872	$1,589
Specialty P&C Combined Ratio (%)	98.4%	102.1%
Specialty P&C Loss Ratio (%)	75.7%	66.9%
Specialty P&C Expense Ratio (%)	22.7%	35.2%

Key KPIs

KPI	Q1 2024	Q1 2025
Specialty P&C Gross Premiums Written ($USD Thousands)	$96,422	$86,915
Insurance Distribution Premiums Placed ($USD Thousands)	$90,096	$230,606
Total Specialty P&C Insurance Production ($USD Thousands)	$186,518	$317,521
Share Repurchases (Shares; Avg Price)	N/A	264,791; $11.79
AFG Standalone Net Assets ($USD Millions)	N/A	$104 (Cash & liquid $54; Other investments $29)
Stockholders’ Equity ($USD Millions; $/share)	$857; $18.43 (Dec 31, 2024)	$852; $18.36 (Mar 31, 2025)

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Adjusted EBITDA to common shareholders ($USD Millions)	FY 2028	$80–$90 target (long-term)	$80–$90 target reiterated	Maintained
Legacy Business Sale Close	2025	Anticipated later Q1/Q2 2025	All pre-closing conditions completed; pending Wisconsin OCI approval	Status update (pending)
Everspan Expense Ratio	Near-term	N/A	Expected to trend more favorably as portfolio migrates/scales	Qualitative improvement expected
Property vs Casualty Mix	Near-term	N/A	Focus on casualty growth; property pricing softening but still attractive	Strategic emphasis shift

No formal numeric quarterly guidance for revenue, margins, OpEx, OI&E, or tax rate was provided this quarter .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q3 2024)	Previous Mentions (Q4 2024)	Current Period (Q1 2025)	Trend
AI/data capabilities	Not highlighted	Not highlighted	Emphasis on “technology‑focused shared service model” and building strong data and AI capabilities	Increasing importance
Property vs Casualty mix	Everspan combined ratio improved; scaling programs	Combined ratio improved to 96.5%	Casualty to drive growth; property pricing softening but still attractive	Shift toward casualty growth
ESL/A&H lines	N/A	Organic growth pressured by A&H; ESL weakness noted	Pullbacks in ESL and short-term medical drove -2% organic growth; ex-these lines ~12% organic	Headwinds, stabilizing outlook
Regulatory/legal – Legacy sale	Shareholder approval; PRA approved; awaiting Wisconsin OCI	Anticipated later this quarter/early next	All pre-closing conditions complete; pending final Wisconsin OCI approval	Nearing completion
Competition	N/A	N/A	Competitive intensity rising; Ambac differentiated via capacity access and model	Heightened competition

Management Commentary

“Ambac's insurance distribution and specialty program business got off to a very strong start in 2025, producing $318 million of premium, up 70% and generating $63 million of revenue, up 27%... primarily attributable to our Beat acquisition” .
“Everspan... loss ratio improved nearly 9% or 880 basis points... combined ratio of 102... expense ratio will begin to trend more favorably in coming quarters as we migrate the portfolio and further scale our business” .
“We believe the unique value proposition... includes... a technology-focused shared service model committed to the development of strong data and AI capabilities... well positioned to achieve our long-term goals of generating $80 million to $90 million of adjusted EBITDA... in 2028” .
CFO: “EPS included ~$0.23 per share of headwind from the change in carrying value of redeemable non-controlling interest... expenses up driven by G&A (+$21M incl. $15.5M Beat), intangible amortization (+$8M), and interest expense (+$5M) related to Beat financing” .

Q&A Highlights

Staffing and talent: Management sees significant opportunities and a deep pipeline for recruiting underwriting and producer talent, leveraging shared services and the differentiated model .
Mix outlook: Property remains critical (mostly via Beat), but liability/casualty will be primary growth driver; property returns remain attractive despite softening pricing; A&H remains an important component .
Competitive environment: Competition is increasing, but Ambac believes managed capacity access and its partnership model attract top MGAs and underwriters .

Estimates Context

Metric	Q3 2024	Q4 2024	Q1 2025
Primary EPS Consensus Mean ($)	0.13	0.06	-0.07
Actual Adjusted EPS ($)	-0.46	-0.12	-0.13
Beat/Miss	Miss	Miss	Miss (bold)
Revenue Consensus Mean ($USD Millions)	N/A	N/A	N/A
Actual Revenue – Continuing Ops ($USD Millions)	70.0	65.2	62.8
Primary EPS – # of Estimates	2	1	1

Values retrieved from S&P Global.
Interpretation: Ambac missed EPS consensus in each of the last three quarters; revenue estimates were unavailable (thin coverage), but actual revenues reflect a modest downtrend from Q3 to Q1, consistent with Everspan earned premium reductions and higher corporate costs tied to Beat integration.

Key Takeaways for Investors

Integration costs and financing tied to Beat weighed on EPS and Adjusted EBITDA; expect normalization as intangible amortization runs through and short-term Beat financing is repaid upon legacy sale close .
Everspan’s underwriting quality improved (loss ratio -880 bps YoY), but combined ratio rose on expense ratio; scaling and portfolio migration are expected to reduce the expense ratio over time .
Cirrata’s growth engine is intact: $41.0M revenue (+129% YoY) and $7.1M Adjusted EBITDA to shareholders despite A&H/ESL headwinds; several 2024 MGAs already profitable .
Strategic catalysts: pending Wisconsin OCI approval of the legacy sale (final condition) and continued MGA launches under a tech-enabled shared service model focused on data/AI .
Capital deployment: ongoing repurchases ($35.2M authorization remaining) provide downside support and capital return optionality .
Near-term trading: EPS misses versus consensus and a higher combined ratio may pressure shares until regulatory closure and expense normalization are visible; headlines around sale approval and margin trajectory are swing factors .
Medium-term thesis: specialty P&C distribution/underwriting platform with managed capacity and scalable shared services, with a long-term Adjusted EBITDA target of $80–$90M (2028) offering a path to profitable growth once near-term headwinds subside .

Bolded surprises/misses:

EPS miss vs consensus (Q1 2025: -$0.07 est vs -$0.13 actual). Values retrieved from S&P Global.

Additional cross-references and clarifications:

Q1 2025 continuing ops revenue $62.8M and net loss to shareholders $(16.1)M reflect Beat amortization/interest and transaction-related fees, offset by lower Everspan losses .
Specialty P&C production rose 70% to $317.5M, driven by Insurance Distribution premiums placed (+156%) and Everspan GPW (down 10% due to program exits) .
Corporate (AFG standalone) ended Q1 with $104M net assets ($54M cash/liquid; $29M other investments) .

AMBAC FINANCIAL GROUP INC (AMBC)·Q1 2025 Earnings Summary