NP earnings analysis
What we found in NP's 10-Q: the parts that mattered, the offsets in the same document, and what the company said about what comes next.
Our reading of the filing · Free to read, no account needed
Neptune delivered a strong Q2, with revenue of $55.872 million growing 32.8% year over year and 47.8% sequentially, while GAAP diluted EPS rose to $0.11 from $0.05 in Q1. The quarter combined policy and written-premium growth above 29% with a sequential rebound in operating margin to 47.5% and calculated free cash flow of $41.233 million for the first half. Offsetting factors are a substantial increase in share-based compensation, lower premium/revenue retention, and $240.0 million of floating-rate revolver debt; the filing did not provide numerical earnings guidance.
The parts that mattered.
Pulled out of the filing itself, with the figures the company reported.
- Revenue accelerated to record $55.9M
- Q2 revenue reached $55.872 million, up $13.806 million (32.8%) year over year and $18.077 million (47.8%) sequentially from $37.795 million in Q1 2026. Growth was driven by higher policy counts, premium volume, renewals and new-policy sales.
- Sequential operating-margin rebound
- GAAP operating income rose to $26.551 million from $21.290 million a year ago, while operating margin was 47.5%. Margin expanded sharply from 35.6% in Q1 2026, though it was down from 50.6% in Q2 2025 due principally to $6.957 million of share-based compensation.
- EPS and net income increased
- GAAP diluted EPS was $0.11, up from $0.05 in Q1 2026; adjusted diluted EPS was $0.15. Net income increased 35.9% year over year to $15.796 million from $11.620 million.
- Policy base and written premium expanded
- Underlying operating indicators remained strong: premium in force rose 31.8% to $418.983 million, policies in force grew 29.0% to 316,106, and written premium rose 31.1% to $126.882 million.
- Cash conversion remained robust
- Six-month operating cash flow increased to $43.404 million from $22.964 million, while $2.171 million of software capex produced calculated free cash flow of $41.233 million. Capex represented 5.0% of operating cash flow.
- Cash liquidity increased
- Liquidity improved, with total cash and fiduciary cash of $76.998 million at June 30 versus $40.538 million at December 31; non-fiduciary cash and equivalents increased to $17.550 million from $8.002 million. The company also had $20.0 million available on its revolver.
And the other side of it.
The offsets in the same document — the things a summary that only listed the good news would have left out.
- Equity compensation pressured GAAP margins
- Share-based compensation rose to $6.957 million in Q2 from $0.105 million a year earlier, contributing to total operating-expense growth of 41.1%, faster than 32.8% revenue growth, and a 3.1-percentage-point year-over-year decline in operating margin to 47.5%.
- Premium and revenue retention weakened
- Premium retention declined to 92.1% from 99.9% year over year, and trailing-12-month revenue retention fell to 89.5% from 92.3%. This indicates less favorable renewal economics despite policy retention improving 0.3 percentage points to 86.0%.
- Large floating-rate debt exposure
- The company had $240.0 million outstanding under its SOFR-linked revolving facility at June 30, 2026. Management estimates that an immediate 1% interest-rate increase would have a $2.4 million annual pre-tax impact.
- Capacity-provider and agent dependency
- No material changes to the risk factors from the 2025 Form 10-K were reported. Nevertheless, distribution concentration remains meaningful: third-party agents and brokers accounted for over 96% of policies in force, while 45 capacity providers support 8 insurance programs.
What they reported.
What the company itself reported, taken out of the document.
- Earnings per share
- $0.11
- Gross margin
- 100.0%
- Operating margin
- 47.52%
- Segment
- Single operating and reportable segment: commissions and fees revenue of $55.872 million.
What they said about what is next.
The 10-Q provides no explicit quantitative revenue or EPS outlook. Management states that $17.6 million of cash and cash equivalents plus $20.0 million of undrawn revolver capacity should fund working-capital and capital-expenditure needs for at least the next 12 months, and expects software-development investment to continue at a similar or slightly greater pace.
The filing reads better than the one before it.
What came before.
- 10-Q · April 29, 2026
- Neptune Insurance Holdings reported strong Q1 2026 results with revenue of $37.8 million, a 29% year-over-year increase, and EPS of $0.09, surpassing expectations. However, GAAP net income decreased by 26% to $7.3…
- 10-K · February 26, 2026
- Neptune (NP) presents a high-growth, highly profitable MGA model driven by proprietary AI/ML underwriting (Triton) and a large capacity/distribution network. For the year ended December 31, 2025, Neptune reported…
This is our reading of a public filing, not the filing. Read the original on SEC.gov · Educational only. Nothing here is investment advice.
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