Executive Summary

Strong Q2: Revenue $481.1M (+19% YoY), Net Income $53.2M (vs. $19.4M), Adjusted EBITDA $87.5M (+30% YoY); Senior segment Adj. EBITDA margin reached 39% (+~750 bps YoY) amid a “historically disruptive” AEP .
Guidance raised: FY25 revenue $1.50–$1.575B (prior $1.425–$1.525B), Adj. EBITDA $115–$140M (prior $100–$130M), Net income $(24)–$11M (prior $(59)–$3M) .
Capital structure de-risking: Announced and subsequently closed $350M strategic investment (Bain Capital, Morgan Stanley Private Credit, Newlight), using ~$260M to pay down term debt; >$100M liquidity post-close; annual cash interest expected to decline by ~$30M, cost of capital down >150 bps per management .
Key catalysts: Senior margin strength and policy recapture in disrupted AEP, SelectRx growth (members +54% YoY), and capital structure improvement; management again raised FY25 outlook .

What Went Well and What Went Wrong

What Went Well

Senior execution and margins: “Senior Adjusted EBITDA margin of 39%, up approximately 750 basis points year-over-year,” reflecting high-touch, agent-led model in a highly disrupted AEP .
SelectRx momentum: Healthcare Services revenue $183.4M (+64% YoY) with SelectRx members at 96,695 (+54% YoY), demonstrating strong attachment to Senior funnel and improved onboarding .
Improved unit economics and capital: Revenue/CAC reached 5.3x on a rolling basis; company secured $350M preferred equity to enhance liquidity and growth flexibility .

What Went Wrong

LTV per approved MA policy declined: Medicare Advantage LTV was $907, down 3% YoY (mix-driven per management), which can pressure per-policy revenue if persistent .
Healthcare Services margin compression in quarter: Adj. EBITDA margin 1% vs. 3% prior year in AEP-heavy quarter due to upfront onboarding spend .
Interest burden still material in Q2: Interest expense was $23.7M, underscoring why deleveraging and securitization remain focal points despite recent progress .

Financial Results

Consolidated (GAAP and Non-GAAP)

Metric	Q4 FY2024	Q1 FY2025	Q2 FY2025
Revenue ($M)	$307.208	$292.263	$481.069
Net Income (Loss) ($M)	$(31.017)	$(44.546)	$53.236
Adjusted EBITDA ($M)	$14.357	$(1.683)	$87.519

Notes: Management cited company-wide Adj. EBITDA margin ~18% in Q2 as SelectRx mix rose .

Segment Breakdown (Q2 YoY)

Segment	Q2 FY2024	Q2 FY2025
Senior Revenue ($M)	$247.529	$255.578
Senior Adj. EBITDA ($M)	$78.713	$100.521
Senior Adj. EBITDA Margin	32%	39%
Healthcare Services Revenue ($M)	$111.710	$183.370
Healthcare Services Adj. EBITDA ($M)	$2.981	$2.212
Healthcare Services Adj. EBITDA Margin	3%	1%
Life Revenue ($M)	$37.367	$39.861
Life Adj. EBITDA ($M)	$4.569	$7.423
Life Adj. EBITDA Margin	12%	19%

KPIs (Q2 YoY)

KPI	Q2 FY2024	Q2 FY2025
Approved MA policies	234,576	247,849
LTV per Approved MA Policy ($)	934	907
SelectRx Members (period-end)	62,623	96,695
Prescriptions per Day (avg, quarter)	17,010	26,846
Revenue/CAC (R12M)	4.2x	5.3x

Non-GAAP bridge (Q2 total): Adj. EBITDA $87.519M adjusted for share-based comp $(4.699)M, transaction costs $(6.719)M, D&A $(5.060)M, change in FV of warrants $(7.642)M, interest $(23.721)M, to arrive at income before tax $39.556M .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Revenue	FY2025	$1.425B–$1.525B	$1.500B–$1.575B	Raised
Adjusted EBITDA	FY2025	$100M–$130M	$115M–$140M	Raised
Net Income (Loss)	FY2025	$(59)M–$3M	$(24)M–$11M	Raised
Senior segment margin (H2 commentary)	H2 FY2025	—	Low–mid 20s (management expectation)	New color
Healthcare Services margin (FY view)	FY2025	—	Low single digits (management expectation)	New color

Earnings Call Themes & Trends

Topic	Previous Mentions (Q4 FY2024, Q1 FY2025)	Current Period (Q2 FY2025)	Trend
Capital structure optimization	Q4: announced intent for ~$100M receivables securitization ; Q1: announced initial securitization	$350M preferred investment announced and later closed; ~$260M debt paydown, >$100M liquidity; >150 bps lower cost of capital, ~$30M lower annual cash interest (mgmt)	Accelerating de-leveraging and flexibility
AEP disruption and recapture	—; Q1 teed up AEP update next quarter	~6% MA plan terminations vs <1% typical; >30% recapture; stable persistency ex-terminated; net cash impact ~$(5)M	Managed disruption, supported close rates/productivity
Senior execution and margins	Q4 Senior Adj. EBITDA margin 24% ; Q1 Senior margin 8%	Senior margin 39% (+~750 bps YoY), strong tenured-agent productivity and lower marketing per policy	Strong upward inflection in peak season
SelectRx growth and attachment	Q4 members ~82k ; Q1 members 86,521 (+64% YoY)	Members 96,695 (+54% YoY); Healthcare Services revenue +64% YoY; faster same-quarter conversion in AEP	Scaling; moderate growth expected H2 post pull-forward
Unit economics	Q4 R12M Rev/CAC 4.5x ; Q1 4.6x	5.3x R12M; management highlights as scale proof point	Improving
Regulatory/macro	—;	Management views regulatory outlook turning more favorable; positive read on advance rate notice for payer profitability/benefits	Modestly improving backdrop

Management Commentary

“SelectQuote delivered impressive results during our fiscal second quarter despite a historically disruptive Annual Enrollment Period... Senior Adjusted EBITDA margin of 39%, up approximately 750 basis points year-over-year...” — CEO Tim Danker .
“On the strength of both our Senior and Healthcare Services results, today we are raising our 2025 guidance ranges...” — CEO Tim Danker .
“Our capital actions... will decrease our ongoing cost of capital by more than 150 basis points and... reduce our annual cash interest obligations by approximately $30 million.” — CEO Tim Danker .
“Revenue to CAC... over the last few years from less than 2x to over 5x this quarter.” — CEO Tim Danker .
“We recaptured over 30% [of terminated policies]... persistency trends for policies not terminated... were stable... commissions receivable balance of over $1 billion is a highly attractive asset.” — CFO Ryan Clement .

Q&A Highlights

Guidance stance and H2 cadence: Management acknowledged conservatism given a unique AEP; expects Senior EBITDA margin low–mid 20s in H2, Healthcare Services low single-digit margin for FY25 as SelectRx scales .
Use of proceeds and liquidity: ~$260M used to retire term debt; full repayment of revolver balances; ~$100M liquidity post-close; ~$30M annual cash interest reduction expected .
Securitization path: Initial $100M securitization performing well; preferred equity strengthens position to pursue follow-on securitizations for further deleveraging/asset-light model .
Agent strategy and productivity: Tenured agents drove 6% more MA policies with 22% fewer agents; management plans “responsible growth” with traditional hiring cycle into AEP as capital constraints ease .
SelectRx adoption drivers: Home delivery value, adherence gains to ~90% for many disease states, policy changes reducing out-of-pocket “donut hole” burden enhance proposition and payer STARS outcomes .

Estimates Context

S&P Global consensus for Q2 FY2025 EPS and revenue was unavailable at query time due to data access limits; as a result, we cannot quantify beat/miss versus Street this quarter. We anchored estimate commentary to company guidance and management qualitative framing [GetEstimates error].
Directionally, management’s raised FY25 ranges (revenue, Adj. EBITDA, net income) imply estimates may need upward revision in outer quarters, while H2 Senior margins normalize to low–mid 20s and Healthcare Services margins remain low single digits per commentary .

Key Takeaways for Investors

Senior operating leverage and recapture capability in a disrupted AEP delivered a step-up in peak-season profitability; durability into H2 normalizes margins but highlights the redesigned model’s resilience .
SelectRx continues to scale as a powerful downstream monetization engine from Senior engagement, with faster same-quarter conversion in AEP and strong YoY growth; expect moderated H2 growth after pull-forward .
Capital structure actions are a material de-risking: $350M preferred equity (closed) plus existing securitization lower funding costs, extend maturities, and add >$100M liquidity to support measured growth and potential further securitizations .
Unit economics are inflecting (R12M Rev/CAC 5.3x), suggesting improving cash conversion as cohort maturities roll, a positive for medium-term FCF trajectory if sustained .
Watch mix headwinds: MA LTV down 3% YoY on carrier mix; continued monitoring of LTV and persistency assumptions is key to receivables valuation and cash flow timing .
H2 setup: Expect margin normalization (Senior low–mid 20s), modest SelectRx margin, and moderated member growth; execution on securitization follow-ons and additional deleveraging could be incremental stock catalysts .
Regulatory tone improving (advance rate notice, favorable outlook) may enable reinvestment in plan benefits and a more stable competitive environment, supporting volume and unit economics into FY26 .

Appendix: Additional Data Points

Consolidated revenue composition Q2: Commissions and other services $301.069M; Pharmacy $180.000M .
Q2 operating expense drivers: Marketing and advertising $97.725M (down vs. prior-year), COGS—pharmacy $156.201M (up with SelectRx scale) .
YTD cash flow (six months): Net cash used in operating activities $(45.304)M; ending cash, cash equivalents and restricted cash $13.633M .
Life segment strength: Q2 Life revenue $39.861M (+7% YoY) and Adj. EBITDA $7.423M (+62% YoY), margin 19% .

Sources: Q2 FY2025 press release and financial statements ; Q2 FY2025 earnings call (prepared remarks and Q&A) ; Strategic investment press releases (announcement and close) ; Prior quarters for trend (Q1 FY2025, Q4 FY2024) .

SelectQuote, Inc. (SLQT)·Q2 2025 Earnings Summary