Goosehead revenue rises 17% ahead of broad financial restatement

Goosehead Insurance reported third-quarter revenue of approximately $110 million, up 17% year over year, representing the midpoint of its earnings-release range. The distributor plans to restate statements covering 2023 through 2025 and the first half of 2026. Management expects the restatement to increase revenue, operating income and adjusted EBITDA without changing the underlying economics of the business.

Core Revenue, a separately reported company measure, rose 13% to $95 million. Its growth trailed the 17% increase in total revenue.

What does the restatement change?

Senior Director of Investor Relations Maddie Middleton said: “Previously issued annual and quarterly financial statements for 2023 through 2025, along with quarterly statements for the first half of 2026, should no longer be relied upon.” The review remains ongoing, and management described estimated adjustments as preliminary, unaudited and subject to change.

Chief Financial Officer John Martin said Securities and Exchange Commission (SEC) staff sent a comment letter about disclosures in the 2025 annual filing, including accounting for costs of obtaining customer contracts. Goosehead historically expensed agent compensation as incurred; it now expects to defer part of those costs and recognize them over the expected benefit period.

President and Chief Operating Officer Mark Jones Jr. said the change primarily concerns variable compensation paid to corporate sales agents for generating new business. Martin also said Goosehead recorded franchise-related fees, largely tied to technology cost recovery, as offsets to general and administrative expenses.

Those fees should be classified as revenue, so the reclassification will increase revenue and expenses by equal amounts without affecting Core Revenue or cash flow. Preliminary estimates for the affected periods are:

• 2025: Revenue and general and administrative expenses each increase by $11 million to $16 million.
• First three quarters of 2026: Both lines increase by $8 million to $13 million.

For full-year 2025 and the first half of 2026, Goosehead expects compensation expense to decrease and operating income to rise by an amount equal to approximately 0.5% to 5.5% of total employee compensation and benefits. Martin said the restatement does not change the underlying economics of the business.

Goosehead is working to file the restatements and its third-quarter Form 10-Q as soon as practical. Management deferred a fuller discussion of expenses and profitability until the financial statements are finalized.

Is the distribution network expanding?

• Policies in force increased 14% from a year earlier to 2.1 million.
• Total written premiums rose 11% to $1.3 billion.
• New business commissions increased 21% to $9.1 million, while new business royalties rose 13% to $9.4 million.
• Client retention reached 86%, which Martin described as significantly improved.
• The company ended the quarter with 2,840 producers across corporate, enterprise and franchise operations, up 7% year over year.
• Same-store sales, measuring existing franchise outlets, rose 17% across the franchise channel, while sales among its 50 largest franchises increased 29%, Martin said.

How are pricing and retention affecting growth?\n

Auto pricing fell by a mid-single-digit percentage, while homeowners pricing declined by a low-single-digit percentage, Jones said. Declines ran steeper in some markets, including Texas and Florida. A larger-than-expected price decline in Goosehead’s Texas corporate book slowed Core Revenue growth compared with the second quarter.

Lower prices can create a short-term headwind to renewal revenue when agents move clients to more competitive policies, though management expects that practice to support retention over time. Jones declined to predict when pricing pressure would ease.

Which channels are generating new business?

Goosehead’s enterprise sales team, with more than 150 agents, delivered new-business growth above 50% for an eighth consecutive quarter. Enterprise sales generated 23% of total new business commissions and agency fees in the quarter.

CEO Mark Miller said the company has launched 12 embedded franchisees within businesses that already have established customer lead flow. New business production at those agencies rose 64% from a year earlier. Jones said the embedded partners remain a relatively small part of franchise new business production, although their contribution is growing.

How is digital service developing?

Goosehead now completes nearly one-third of service work entirely through digital channels, Jones said. The company is building a Model Context Protocol (MCP) server, intended to connect personal AI assistants with Goosehead services, for launch by year-end.

Most Digital Agent users still consult a human agent before completing a purchase. Jones also cited unresolved regulatory, customer-consent and security questions as Goosehead develops connections to AI agents.

What is the 2026 outlook?

Goosehead maintained its full-year revenue and written-premium growth outlook, reiterated as 12% to 19% organic revenue growth and 12% to 20% organic written-premium growth for 2026. Jones raised the full-year contingent-commission expectation to 80 to 110 basis points of total written premium, from 70 to 100 basis points. One basis point equals 0.01 percentage point.

Who leads Goosehead after year-end?

Miller said the earnings call was his last as CEO and that he will retire at the end of 2026. He expressed confidence in Jones and the leadership team, saying Goosehead’s “best days are still in front of us with Mark at the helm.”

What does Goosehead do?

Mark and Robyn Jones founded Goosehead Insurance, listed on Nasdaq under GSHD, in 2003. The independent agency operates from Westlake, Texas, and serves customers across the United States.

It distributes personal insurance through company-operated and franchised locations and works with multiple carriers, helping customers compare coverage and obtain policies. Products include homeowners, automobile, flood, umbrella and other personal insurance. Goosehead also supports agents with quoting, policy-management and customer-service technology.