Root, Inc. (ROOT) · Nov 4, 2026 · Earnings

Root earnings beat estimates, but revenue misses as growth slows

Beat — Diluted EPS $0.86 vs ~$0.63 consensus; revenue $381.3M vs ~$384.4M

Root’s Q3 earnings beat EPS expectations on stronger underwriting and cost control, but revenue and written premiums declined as competition intensified.

Root is in the middle of a controlled transition: it is building a more profitable insurance platform around data-driven pricing, embedded distribution, and partnerships such as Carvana, rather than chasing premium volume at any cost. Its strategy emphasizes accurate pricing and integrated partner distribution as the route to scaling personal auto insurance.

MetricQ3 2026Q3 2025Consensus
Revenue (Income Statement)$381.3M (-1.7%)$387.8M$384.4M
Diluted EPS (Income Statement)$0.86$(0.35)~$0.63
Net income (Income Statement)$14.4M$(5.4M)
Adjusted EBITDA (KPI table)$33.5M (-0.6%)$33.7M
Gross written premiums (Written and Earned Premium)$357.5M (-7.7%)$387.2M
Net combined ratio (KPI table)97.2% (-4.9 pts)102.1%
Policies in force (KPI table)484,037 (+3.8%)466,320

Profitability beat the market’s bar, but not because the business accelerated. Diluted EPS of $0.86 exceeded the published consensus of roughly $0.63, while revenue of $381.3 million came in modestly below the roughly $384.4 million expectation. The underlying improvement was real: net income turned positive and the net combined ratio improved to 97.2%, showing Root is earning money on underwriting rather than relying only on investment income. 〔0〕

The trade-off is slower top-line growth. Gross written premiums fell 8% year over year and gross earned premiums fell 5%, while premiums per policy declined to $1,441 from $1,581 a year earlier. Policies in force rose 4% but were broadly flat sequentially, indicating that Root is protecting returns by being selective while larger carriers cut prices and spend more aggressively.

Partnership distribution is becoming more important, but the payoff is still ahead. Partnership new writings grew 19% and reached 52% of total new writings, while Root renewed Carvana through August 2028 and launched a Hyundai pilot. Those developments strengthen the intended growth engine, but the quarter’s falling premiums show that new distribution has not yet translated into broad volume growth. 〔1〕 〔2〕

The next pricing model is the main unproven operating catalyst. Root completed its latest proprietary pricing model and began deploying it in the fourth quarter, claiming its largest expected improvement in predictive power to date. If it expands the pool of customers Root can price profitably, it could address the current volume constraint; this filing provides no evidence yet that the model has produced results. 〔3〕

Bottom line: Root beat earnings expectations through better underwriting and disciplined spending, but revenue and premium volume remain under pressure. The business is healthier, though the growth engine is still being rebuilt rather than visibly reaccelerating.

What to watch next

Pricing model deployment and early performance in Q4

Original filing on SEC EDGAR

More Root, Inc. news

Root earnings beat estimates, but revenue misses as growth slows | ROOT Stock News
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