TWFG, Inc. Q1 FY2026 earnings call

1. Business is firing on all cylinders with total revenue up 35.3%. 2. Organic growth is strong, 2x the industry, and strategic tailwinds are present for the second quarter and remaining part of the year. 3. MGA platform is scaling with new programs and distribution points in different business units. 4. Reaffirming full guidance for revenue growth, organic growth, and adjusted EBITDA. 5. Capital allocation strategy is working with $40 million of the $50 million buyback executed and three acquisitions completed.

Not explicitly detailed in the transcript regarding specific product segment financial performance in absolute terms and revenue contribution %

1. Maintained 10 to 15% full year guidance as soft market impact was assumed and not expecting dramatic pricing change to alter it. 2. Second quarter organic growth strong due to policies renewing and voluntary programs, maintaining the guidance range.

Not explicitly discussed in the transcript regarding risks and operational failures

Q: I just want to confirm, the reason that organic will be strong in 2Q, I think, are the four that take out books, renewing into organic, right? And then about voluntary program and takeouts.

A: Yes, we have policies renewing in the second quarter that are going to help drive organic up to high double digits. We also have a voluntary program, which is an entirely new form and distribution that was stood up from scratch, and everything that it generates is also organic, separate from the takeout. The takeouts are also accelerating their new business traction coming into this quarter. Also, we're being disciplined on the retention rate we're using.

Q: Gordy, a couple questions here. First, what is the organic growth of your MGA business this quarter? And are you seeing a slowdown in business moving into the non-admitted market?

A: The vast majority of our MGA is admitted. Our admitted portfolios are growing. As we've been able to introduce new products in new states, as we've expanded our own product in our core state, we are able to grow PIF and premium in both the admitted programs. On the ENS side, for states like California, we're seeing less dependency on the E&S homeowner's market as more traditional carriers are opening up capacity in California.

Q: One last one, with AI and what's going on, will that over time force commission rates to decline?

A: It's too early to predict that that's an outcome. Nobody yet knows the long-term cost of the AI tools. I think it's presumptuous to believe that all the AI tools are going to inherently create a cost savings. Over time, we believe there will be efficiencies and margin expansion opportunities, but way too early to predict that. And on how agency economics shift carrier commission schedules, we've proven independent agency distribution provides superior portfolio, better retention, better loss ratios, and don't see carriers immediately directing commission expenses downward in a very competitive marketplace.