TRUP

Overview We provide medical insurance for cats and dogs in the United States, Canada, and certain countries in Continental Europe. Through our data-driven, vertically-integrated approach, we develop and offer high-value medical insurance products, priced to take into account each pet’s unique characteristics and coverage level. Our growing and loyal membership base provides us with highly predictable and recurring revenue. We operate in two reporting segments: subscription business and other business. We generate revenue in our subscription business segment primarily through insurance premiums, which we refer to as subscription payments from direct-to-consumer products. We operate our subscription business segment similar to other subscription-based businesses, with a focus on achieving a target margin prior to our new pet acquisition expense and acquiring as many pets as possible at our targeted average estimated internal rate of return. Within our subscription business, we also provide "Powered by Trupanion" pet insurance product offerings marketed by third parties, low and medium average revenue per pet products marketed under the brand names Furkin and PHI Direct in Canada, and a Trupanion branded product in Germany and Switzerland. We either directly underwrite or assume full insurance risk for these products through reinsurance arrangements. We provide a full suite of services and support for these products and they are designed to align with the target margin profile of our subscription business segment. Within this segment, we also offer products in certain countries in Continental Europe, which are currently underwritten by third parties who pay us commissions that we recognize as revenue. We generate leads for our subscription business segment from a diverse set of member acquisition channels, which we then seek to convert into members through our contact center, website and other direct-to-consumer activities. These channels include referrals from third-parties such as veterinarians and existing members. Veterinary hospitals represent our largest referral source. Our “Territory Partners” create relationships with veterinary hospital teams through face-to-face visits. Territory Partners are dedicated to cultivating direct veterinary relationships and helping those veterinarians understand the benefits of high-quality medical insurance. Veterinarians then educate pet parents, who visit our website or call our contact center to learn more about, and potentially enroll in, a Trupanion product. We also receive a significant number of new leads from existing members adding pets and referring their friends and family members. Our direct-to-consumer acquisition channels serve as important resources for pet parent education and drive new member leads and conversion. We monitor average pet acquisition cost to evaluate the efficiency in acquiring new members and measure effectiveness based on our targeted return on investment. Our other business segment generates revenue from other product offerings, primarily by underwriting policies on behalf of third parties with whom we generally have a business-to-business relationship. This business segment has, and targets, a significantly lower margin profile than our subscription business segment and is not part of our core business strategy. The largest source of revenue within this segment is from our long-standing contractual relationship as an underwriter for Pets Best, a third-party insurance provider we have worked with since 2015. We and Pets Best have agreed to end our relationship after the third quarter of 2028. We expect that enrollment from Pets Best will continue to decline as it rolls off business and engages other third-party underwriters. Additional products in this segment include the U.S. Department of Veterans Affairs program and employer-sponsored programs, primarily for companies with animal health related operations. 20 Key Operating Metrics The following table sets forth total enrolled pets in our subscription and our other business segment and key operating metrics for our subscription business for year-to-date values as well as each of the last eight fiscal quarters. Six Months Ended June 30, 2026 2025 Total Business: Total pets enrolled (at period end) 1,633,131 1,660,455 Subscription Business: Total subscription pets enrolled (at period end) 1,124,548 1,066,354 Monthly average revenue per pet $ 86.62 $ 78.73 Average pet acquisition cost (PAC) $ 307 $ 272 Average monthly retention 98.37 % 98.29 % Three Months Ended Jun. 30, 2026 Mar. 31, 2026 Dec. 31, 2025 Sep. 30, 2025 Jun. 30, 2025 Mar. 31, 2025 Dec. 31, 2024 Sep. 30, 2024 Total Business: Total pets enrolled (at period end) 1,633,131 1,637,665 1,647,565 1,654,414 1,660,455 1,667,637 1,677,570 1,688,903 Subscription Business: Total subscription pets enrolled (at period end) 1,124,548 1,105,783 1,096,173 1,082,412 1,066,354 1,052,845 1,041,212 1,032,042 Monthly average revenue per pet $ 87.44 $ 85.79 $ 83.56 $ 82.01 $ 79.93 $ 77.53 $ 76.02 $ 74.27 Average pet acquisition cost (PAC) $ 299 $ 315 $ 320 $ 290 $ 276 $ 267 $ 261 $ 243 Average monthly retention 98.37 % 98.35 % 98.34 % 98.33 % 98.29 % 98.28 % 98.25 % 98.29 % Total pets enrolled and total subscription pets enrolled include certain pet enrollments in European markets, where policies are currently underwritten by third parties and Trupanion is acting as an insurance broker. Per pet metrics, however, exclude these European policies, as their revenue is currently earned from commissions, as opposed to the subscription payments earned by the remainder of our subscription business. Total pets enrolled. Total pets enrolled reflects the number of pets enrolled in one of the insurance products offered in our subscription business segment or our other business segment at the end of each period presented. We monitor total pets enrolled because it provides an indication of the growth of our consolidated business. Total subscription pets enrolled. Total subscription pets enrolled reflects the number of pets enrolled in one of the insurance products offered in our subscription business segment at the end of each period presented. We monitor total subscription pets enrolled because it provides an indication of the growth of our subscription business. Because our subscription business has a significantly higher margin profile than our other business, changes in the rate of growth of our subscription pet enrollment tend to have a greater impact on our consolidated performance. Monthly average revenue per pet. Monthly average revenue per pet is calculated as amounts billed in a given period for subscriptions divided by the total number of subscription pet months in the period. Total subscription pet months in a period represents the sum of all subscription pets enrolled for each month during the period. We monitor monthly average revenue per pet because it is an indicator of the per pet unit economics of our subscription business. 21 Average pet acquisition cost. Average pet acquisition cost ("PAC") is calculated as net acquisition cost divided by the total number of new subscription pets enrolled in that period. Net acquisition cost, a non-GAAP financial measure, is calculated in a reporting period as new pet acquisition expense, excluding stock-based compensation expense, other business segment expense, offset by sign-up fee revenue. We exclude stock-based compensation expense because the amount varies from period to period based on number of awards issued and market-based valuation inputs. We offset sign-up fee revenue because it is a one-time charge to some new members collected at the time of enrollment used to partially offset initial setup costs, which are included in new pet acquisition expenses. We exclude other business segment pet acquisition expense because that does not relate to subscription enrollments. We monitor average pet acquisition cost to evaluate the efficiency in acquiring new members and measure effectiveness based on our targeted return on investment. Average monthly retention. Average monthly retention is measured as the monthly retention rate of enrolled subscription pets for each applicable period averaged over the 12 months prior to the period end date. As such, our average monthly retention rate as of June 30, 2026 is an average of each month’s retention from July 1, 2025 through June 30, 2026. We calculate monthly retention as the number of pets that remain after subtracting all pets that cancel during a month, including pets that enroll and cancel within that month, divided by the total pets enrolled at the beginning of that month. We monitor average monthly retention because it provides a measure of member satisfaction and allows us to calculate the implied average subscriber life in months. 22 Non-GAAP Financial Measures In addition to our results determined in accordance with U.S. GAAP, we believe the following non-GAAP financial measures are useful in evaluating our operating performance. We use the following non-GAAP financial information to evaluate our ongoing operations and for internal planning and forecasting purposes. We believe that these non-GAAP financial measures, when taken collectively, may be helpful to investors in providing consistency and comparability with past financial performance. However, non-GAAP financial information is presented for supplemental informational purposes only, has limitations as an analytical tool, and should not be considered in isolation, or as a substitute for, the directly comparable financial measures prepared in accordance with GAAP. We calculate these non-GAAP financial measures by excluding certain non-cash or non-recurring expenses. We exclude non-recurring transactions and restructuring expenses as they are not indicative of our operating performance. We exclude stock-based compensation as it is non-cash in nature. Although stock-based compensation expenses are expected to remain recurring expenses for the foreseeable future, we believe excluding them allows investors to make meaningful comparisons between our recurring core business operating results and those of other companies. We define non-GAAP development expenses as operating expenses incurred to develop new products and offerings that are pre-revenue. We define non-GAAP fixed expenses as the total of technology and development expense and general and administrative expense, less stock-based compensation expense, non-recurring transaction and restructuring expense, and development expenses related to exploring and developing new products and offerings that generally are in the pre-revenue stage or not at scale. 23 The following table presents the reconciliation of our non-GAAP financial measures from corresponding GAAP measures for year-to-date values as well as each of the last eight fiscal quarters (in thousands): Six Months Ended June 30, 2026 2025 Veterinary invoice expense $ 560,904 $ 503,030 Less: Stock-based compensation expense(1) (1,048) (1,522) Other business cost of paying veterinary invoices(2) (174,687) (161,975) Subscription cost of paying veterinary invoices (non-GAAP) $ 385,169 $ 339,533 % of subscription revenue 70.5 % 71.4 % Other cost of revenue $ 89,457 $ 86,572 Less: Stock-based compensation expense(1) (1,178) (1,082) Other business variable expenses(2) (38,964) (42,267) Subscription variable expenses (non-GAAP) $ 49,315 $ 43,223 % of subscription revenue 9.0 % 9.1 % Technology and development expense $ 24,048 $ 16,658 General and administrative expense 38,627 40,014 Less: Stock-based compensation expense(1) (13,820) (11,788) Development expenses(3) (3,501) (2,353) Fixed expenses (non-GAAP) $ 45,354 $ 42,531 % of total revenue 5.8 % 6.1 % New pet acquisition expense $ 45,416 $ 40,359 Less: Stock-based compensation expense(1) (2,652) (4,390) Other business pet acquisition expense(2) (41) (77) Subscription acquisition cost (non-GAAP) $ 42,723 $ 35,892 % of subscription revenue 7.8 % 7.6 % (1) Trupanion employees may elect to take restricted stock units in lieu of cash payment for their bonuses. We account for such expense as stock-based compensation in accordance with GAAP, but we do not include it in any non-GAAP adjustments. Stock-based compensation associated with bonuses was approximately $0.3 million for the six months ended June 30, 2026. (2) Excludes the portion of stock-based compensation expense attributable to the other business segment. (3) Consists of costs related to product exploration and development that are pre-revenue and historically have been insignificant. 24 Three Months Ended Jun. 30, 2026 Mar. 31, 2026 Dec. 31, 2025 Sep. 30, 2025 Jun. 30, 2025 Mar. 31, 2025 Dec. 31, 2024 Sep. 30, 2024 Veterinary invoice expense $ 279,468 $ 281,436 $ 262,818 $ 263,127 $ 255,580 $ 247,450 $ 245,663 $ 238,814 Less: Stock-based compensation expense(1) (496) (552) (614) (666) (758) (763) (800) (830) Other business cost of paying veterinary invoices(2) (84,665) (90,022) (81,452) (85,394) (82,706) (79,269) (85,378) (82,507) Subscription cost of paying veterinary invoices (non-GAAP) $ 194,307 $ 190,862 $ 180,752 $ 177,067 $ 172,116 $ 167,418 $ 159,485 $ 155,477 % of subscription revenue 70.2 % 70.8 % 69.1 % 70.1 % 71.1 % 71.8 % 70.0 % 71.0 % Other cost of revenue $ 48,333 $ 41,124 $ 49,008 $ 43,739 $ 43,150 $ 43,422 $ 38,721 $ 39,263 Less: Stock-based compensation expense(1) (615) (564) (600) (579) (601) (482) (476) (536) Other business variable expenses(2) (22,881) (16,083) (25,589) (20,702) (20,531) (21,736) (17,336) (18,126) Subscription variable expenses (non-GAAP) $ 24,837 $ 24,477 $ 22,819 $ 22,458 $ 22,018 $ 21,204 $ 20,909 $ 20,601 % of subscription revenue 9.0 % 9.1 % 8.7 % 8.9 % 9.1 % 9.1 % 9.2 % 9.4 % Technology and development expense $ 12,754 $ 11,294 $ 11,303 $ 9,887 $ 8,586 $ 8,072 $ 8,172 $ 7,933 General and administrative expense 19,525 19,102 18,323 18,311 20,122 19,892 16,828 16,977 Less: Stock-based compensation expense(1) (7,545) (6,274) (6,617) (6,551) (6,393) (5,396) (5,277) (5,258) Development expenses(3) (1,801) (1,701) (1,798) (1,199) (946) (1,406) (1,322) (1,474) Fixed expenses (non-GAAP) $ 22,933 $ 22,421 $ 21,211 $ 20,448 $ 21,369 $ 21,162 $ 18,401 $ 18,178 % of total revenue 5.8 % 5.8 % 5.6 % 5.6 % 6.0 % 6.2 % 5.5 % 5.6 % New pet acquisition expense $ 22,805 $ 22,611 $ 23,103 $ 21,946 $ 19,843 $ 20,516 $ 18,354 $ 18,308 Less: Stock-based compensation expense(1) (1,227) (1,425) (1,530) (1,527) (1,516) (2,873) (1,482) (1,503) Other business pet acquisition expense(2) (15) (26) (8) (5) (74) (3) (8) (8) Subscription acquisition cost (non-GAAP) $ 21,563 $ 21,160 $ 21,565 $ 20,414 $ 18,253 $ 17,640 $ 16,864 $ 16,797 % of subscription revenue 7.8 % 7.9 % 8.2 % 8.1 % 7.5 % 7.6 % 7.4 % 7.7 % (1) Trupanion employees may elect to take restricted stock units in lieu of cash payment for their bonuses. We account for such expense as stock-based compensation in accordance with GAAP, but we do not include it in any non-GAAP adjustments. Stock-based compensation associated with bonuses was approximately $0.1 million for the three months ended June 30, 2026. (2) Excludes the portion of stock-based compensation expense attributable to the other business segment. (3) Consists of costs related to product exploration and development that are pre-revenue and historically have been insignificant. 25 When determining our PAC, we calculate net acquisition cost for a more comparable metric across periods. Net acquisition cost, a non-GAAP financial measure, is calculated in a reporting period as GAAP new pet acquisition expense, excluding stock-based compensation expense, other business segment expense, and pet acquisition expense for commission-based policies, offset by sign-up fee revenue. We exclude stock-based compensation expense because the amount varies from period to period based on the number of awards issued and market-based valuation inputs. We exclude other business segment pet acquisition expense because it does not relate to subscription enrollments. We exclude pet acquisition expense for commission-based policies because the revenue of these products is earned from commissions from a third-party underwriter, as opposed to the subscription payments earned by the remainder of our subscription business. We offset sign-up fee revenue because it is a one-time charge to some new members collected at the time of enrollment used to partially offset initial setup costs, which are included in new pet acquisition expenses. The following table reconciles GAAP new pet acquisition expense to non-GAAP net acquisition cost for year-to-date values as well as each of the last eight fiscal quarters (in thousands): Six Months Ended June 30, 2026 2025 New pet acquisition expense $ 45,416 $ 40,359 Net of sign-up fee revenue (2,184) (2,101) Excluding: Stock-based compensation expense (2,652) (4,390) Other business pet acquisition expense (41) (77) Pet acquisition expense for commission-based policies (2,227) (1,524) Net acquisition cost $ 38,312 $ 32,267 Three Months Ended Jun. 30, 2026 Mar. 31, 2026 Dec. 31, 2025 Sep. 30, 2025 Jun. 30, 2025 Mar. 31, 2025 Dec. 31, 2024 Sep. 30, 2024 New pet acquisition expense $ 22,805 $ 22,611 $ 23,103 $ 21,946 $ 19,843 $ 20,516 $ 18,354 $ 18,308 Net of sign-up fee revenue (1,109) (1,075) (1,049) (1,157) (1,061) (1,040) (906) (1,100) Excluding: Stock-based compensation expense (1,227) (1,425) (1,530) (1,527) (1,516) (2,873) (1,482) (1,503) Other business pet acquisition expense (15) (26) (8) (5) (74) (3) (8) (8) Pet acquisition expense for commission-based policies (1,270) (957) (869) (790) (927) (598) (1,125) (634) Net acquisition cost $ 19,184 $ 19,128 $ 19,647 $ 18,467 $ 16,265 $ 16,002 $ 14,833 $ 15,063 Components of Operating Results General We operate in two reporting segments: subscription business and other business. We generate revenue in our subscription business segment primarily by subscription payments from direct-to-consumer products. We operate our subscription business segment similar to other subscription-based businesses, with a focus on achieving a target margin prior to our pet acquisition expense and acquiring as many pets as possible at our targeted average estimated internal rate of return. Within our subscription business, we also currently provide "Powered by Trupanion" pet insurance product offerings marketed by third parties, low and medium average revenue per pet products marketed under the brand names Furkin and PHI Direct in Canada, and a Trupanion branded product in Germany and Switzerland. We either directly underwrite or assume full insurance risk for these products through reinsurance arrangements. We provide a full suite of services and support for these products and they are designed to align with the target margin profile of our subscription business segment. Within this segment we also offer products in certain countries in Continental Europe, which are currently underwritten by third parties who pay us commissions that we recognize as revenue. Our other business segment generates revenue from other product offerings, primarily by underwriting policies on behalf of third parties with whom we generally have a business-to-business relationship. This business segment has and targets, a significantly lower margin profile than our subscription business and is not part of our core business strategy. The largest source of revenue within this segment is from our long-standing contractual relationship with Pets Best, a third party insurance 26 provider we have worked with since 2015. Additional products in this segment include the U.S. Department of Veterans Affairs program and employer-sponsored programs, primarily for companies with animal health related operations. Revenue We generate revenue in our subscription business segment primarily from subscription payments for our pet medical insurance. Subscription payments are paid at the beginning of each subscription period. In most cases, our members authorize us to directly charge their credit card, debit card or bank account through automatic funds transfer. Subscription revenue is recognized on a pro rata basis over the policy term. Membership may be canceled at any time without penalty, and we issue a refund for the unused portion of the canceled membership. In addition to subscription payments, we generate a small amount of revenue from charging a one-time sign-up fee collected at the time of new enrollment to partially offset initial setup costs. Sign-up fees are related to Trupanion’s obligation to provide insurance coverage and are recognized over the policy term. We also generate a portion of our subscription business segment revenue through commissions earned in certain European markets, where policies are currently underwritten by third parties and Trupanion is acting as an insurance broker. We generate revenue in our other business segment primarily from writing policies on behalf of third parties where we do not undertake direct consumer marketing. This segment also includes revenue from other pet insurance products that have a significantly lower margin profile from our subscription business. Cost of Revenue Cost of revenue in each of our segments is comprised of the following: Veterinary invoice expense Veterinary invoice expense includes our costs to review and pay veterinary invoices, administer the payments, and provide member services, and other operating expenses directly or indirectly related to this process. We also accrue for veterinary invoices that have been incurred but not yet received and for the estimated internal costs of processing those invoices. This also includes amounts paid by unaffiliated general agents on our behalf, and an estimate of amounts incurred and not yet paid for our other business segment. Other cost of revenue Other cost of revenue for the subscription business segment includes direct and indirect member service expenses, Territory Partner commissions per member renewal, payment processing fees and premium tax expenses. Other cost of revenue for the other business segment includes the commissions we pay to unaffiliated general agents, costs to administer the programs in the other business segment and premium taxes on the sales in this segment. Operating Expenses Our operating expenses are classified into four categories: technology and development, general and administrative, new pet acquisition expense, and depreciation and amortization. For each category, except depreciation and amortization, the largest component is personnel costs, which include salaries, employee benefit costs, bonuses and stock-based compensation expense. Technology and development Technology and development expenses primarily consist of personnel costs and related expenses for our technology staff, which includes information technology development, security, infrastructure support, and third-party services. It also includes expenses associated with development in new geographies and new products and offerings. General and administrative General and administrative expenses consist primarily of personnel costs and related expenses for our finance, actuarial, human resources, regulatory, legal and general management functions, as well as facilities and professional services. New pet acquisition expense New pet acquisition expenses primarily consist of costs to acquire a pet (including costs associated directly to supporting the first year of a member), personnel costs, costs to educate veterinarians and consumers about the benefits of Trupanion, costs to generate leads and to convert leads into enrolled pets, as well as print, online and promotional advertising costs. 27 Depreciation and amortization Depreciation and amortization expenses consist of depreciation of property, equipment, and software developed for internal use, as well as amortization of finite-lived intangible assets. Gain (loss) from investment in joint venture Gain (loss) from investment in joint venture consists of the share of income and losses from our equity method investment in a joint venture in Australia, as well as income and expenses associated with administrative services provided to the joint venture. In March 2025, we restructured this relationship from a joint venture to a brand license and services arrangement. Stock-based compensation Stock-based compensation is included in the cost and expense line items above. Stock-based compensation will vary depending on corporate performance and terms of the awards under our equity incentive plan. For example, when we have delivered strong performance, stock-based compensation may increase as a result of incentive-based awards under our equity incentive plan. Factors Affecting Our Performance Average monthly retention. Our performance depends on our ability to continue to retain our existing and newly enrolled pets and is impacted by our ability to provide a best-in-class value and member experience. Our ability to retain enrolled pets depends on a number of factors, including the actual and perceived value of our services and the quality of our member experience, the ease and transparency of the process for reviewing and paying veterinary invoices for our members, the rate of veterinary inflation and of our pricing adjustments, and the competitive environment. In addition, other initiatives across our business may temporarily impact retention and make it difficult for us to improve or maintain this metric. For example, if the number of new pets enrolled increases at a faster rate than our historical experience, our average monthly retention rate could be adversely impacted, as our retention rate is generally lower during the first year of member enrollment. Investment in pet acquisition. We have made, and may continue to make, significant investments to grow our member base. Our pet acquisition cost and the number of new members we enroll depends on a number of factors, including the amount we have available and we elect to invest in pet acquisition activities in any particular period in the aggregate and by channel, the frequency of existing members adding a pet or referring their friends or family, the effectiveness of our sales execution and marketing initiatives, changes in costs of media, the mix of our pet acquisition expenditures and the competitive environment. Our average pet acquisition cost has in the past significantly varied, and in the future may significantly vary, from period to period based upon specific marketing initiatives and estimated rates of return on pet acquisition spend. We also regularly test new member acquisition channels and marketing initiatives, which may be more expensive than our traditional marketing channels and may increase our average pet acquisition costs. We continually assess our pet acquisition activities by monitoring the estimated return on PAC spend both on a detailed level by acquisition channel and in the aggregate. Timing of price adjustments. Our subscription business’s cost-plus model depends on our ability to estimate our operating costs and expenses, including veterinary invoice expenses, and to adjust our pricing to achieve our target margins. We regularly reevaluate and adjust the price of our subscriptions, with a goal of achieving our targeted payout ratio, subject to the review and approval of regulators where applicable. This makes it important for us to accurately estimate our costs and to promptly implement pricing adjustments, which generally roll onto our book of insured pets over the succeeding twelve months following any applicable regulatory approval. As a result, we may have timing mismatches during which our pricing does not reflect our current expense profile. In periods of rapid increases in veterinary invoice expenses, including periods of significant inflation, this timing mismatch may have a significant impact on our margin profile. Timing of initiatives. Over time, we plan to implement new initiatives to improve our member experience, make modifications to our subscription plan, introduce new coverage plans, pursue pet food or other adjacent opportunities, improve our technology, increase the number of veterinary hospitals using our patented direct pay software, and find other ways to maintain a strong value proposition for our members. The implementation of such initiatives could impact our expense profile and result in us incurring expenses that may not always directly coincide with revenue increases, resulting in fluctuations in revenue and profitability in our subscription business segment. Mix of sales. The relative mix of our business by geography, pet age, species, breed, and other factors impacts the monthly average revenue per pet we receive. For example, prices from our plans could vary depending on the relative cost of veterinary care in different countries or areas or whether the pet is a dog or a cat. As our mix of business between products and geographies changes, our metrics, such as our monthly average revenue per pet, and our exposure to foreign exchange fluctuations will be impacted. We expect our international business, additional product offerings and "Powered by Trupanion" plans to grow and, in turn, we expect these effects to increase. 28 Other business segment. Our other business segment primarily includes other product offerings that are materially different from those in our subscription business segment. In addition, we expect the growth rate and margin profile of this segment to be significantly different from our subscription business segment. We do not undertake marketing efforts for and are not the primary interface with the customers of the third parties for whom we underwrite other business segment policies. Our relationships in our other business segment are generally subject to termination provisions and are non-exclusive, including our contractual relationship with Pets Best. Accordingly, we have limited influence on the volume of business of this segment. Loss of an entire program via contract termination could result in the associated policies and revenue being lost over a period of 12 to 18 months, which could have a material impact on our results of operations. In some cases, we have structured exclusive relationships, but those relationships have been and may continue to be subject to limitations on the number of enrolled pets as to which we will write policies for the third party. We may enter into additional relationships in this segment in the future, if we believe they will be beneficial, which could impact our operating results. 29 Results of Operations The following tables set forth our results of operations for the periods presented both in absolute dollars and as a percentage of total revenue for those periods. The period-to-period comparison of financial results is not necessarily indicative of future results. Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 (in thousands) Revenue: Subscription business $ 276,690 $ 242,156 $ 546,144 $ 475,220 Other business 116,244 111,401 230,839 220,312 Total revenue 392,934 353,557 776,983 695,532 Cost of revenue: Subscription business 220,254 195,488 436,706 385,333 Other business 107,547 103,242 213,655 204,269 Total cost of revenue(1) 327,801 298,730 650,361 589,602 Operating expenses: Technology and development(1) 12,754 8,586 24,048 16,658 General and administrative(1) 19,525 20,122 38,627 40,014 New pet acquisition expense(1) 22,805 19,843 45,416 40,359 Depreciation and amortization 3,673 3,962 7,379 7,753 Total operating expenses 58,757 52,513 115,470 104,784 Loss from investment in joint venture — — — (305) Operating income 6,376 2,314 11,152 841 Interest expense 1,832 3,682 3,707 6,893 Other (income), net (2,829) (11,914) (5,884) (15,154) Income before income taxes 7,373 10,546 13,329 9,102 Income tax expense 542 1,133 1,618 1,172 Net income $ 6,831 $ 9,413 $ 11,711 $ 7,930 (1) Includes stock-based compensation expense as follows: Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 (in thousands) Veterinary invoice expense(2) $ 505 $ 774 $ 1,065 $ 1,544 Other cost of revenue(2) 620 605 1,189 1,094 Technology and development 2,865 1,470 4,372 2,621 General and administrative 4,738 5,047 9,631 9,575 New pet acquisition expense 1,241 1,560 2,712 4,452 Total stock-based compensation expense $ 9,969 $ 9,456 $ 18,969 $ 19,286 (2) Veterinary invoice expense and Other cost of revenue together comprise stock-based compensation expense included within Total cost of revenue. 30 Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 (as a percentage of revenue) Revenue 100 % 100 % 100 % 100 % Cost of revenue 83 84 84 85 Operating expenses: Technology and development 3 2 3 2 General and administrative 5 6 5 6 New pet acquisition expense 6 6 6 6 Depreciation and amortization 1 1 1 1 Total operating expenses 15 15 15 15 Loss from investment in joint venture — — — — Operating income 2 1 1 — Interest expense — (1) — (1) Other (income), net 1 3 1 2 Income before income taxes 3 3 2 1 Income tax expense — — — — Net income 3 % 3 % 2 % 1 % Stock-based compensation expense: Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 (as a percentage of revenue) Veterinary invoice expense(2) — % — % — % — % Other cost of revenue(2) — — — — Technology and development 1 — 1 — General and administrative 1 1 1 1 New pet acquisition expense — — — 1 Total stock-based compensation expense 2 % 1 % 2 % 2 % Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 (as a percentage of subscription revenue) Subscription business revenue 100 % 100 % 100 % 100 % Subscription business cost of revenue 80 81 80 81 31 Comparison of the Three and Six Months Ended June 30, 2026 and 2025 Revenue Three Months Ended June 30, % Change Six Months Ended June 30, % Change 2026 2025 2026 2025 (in thousands, except percentages, pet and per pet data) Revenue: Subscription business $ 276,690 $ 242,156 14 % $ 546,144 $ 475,220 15 % Other business 116,244 111,401 4 230,839 220,312 5 Total revenue $ 392,934 $ 353,557 11 $ 776,983 $ 695,532 12 Percentage of Revenue by Segment: Subscription business 70 % 68 % 70 % 68 % Other business 30 32 30 32 Total revenue 100 % 100 % 100 % 100 % Total pets enrolled (at period end) 1,633,131 1,660,455 (2) 1,633,131 1,660,455 (2) Total subscription pets enrolled (at period end) 1,124,548 1,066,354 5 1,124,548 1,066,354 5 Monthly average revenue per pet $ 87.44 $ 79.93 9 $ 86.62 $ 78.73 10 Average monthly retention 98.37 % 98.29 % 98.37 % 98.29 % Three months ended June 30, 2026 compared to three months ended June 30, 2025. Total revenue increased by $39.4 million, or 11%, to $392.9 million for the three months ended June 30, 2026. Revenue from our subscription business segment increased by $34.5 million, or 14%, to $276.7 million for the three months ended June 30, 2026. This increase was primarily due to a 9% increase in monthly average revenue per pet and an increase in subscription pet months (the sum of pets enrolled for each month during a period) for policies underwritten by Trupanion. Our subscription pets enrolled increased by 58,194 pets, or 5%, to 1,124,548 for the three months ended June 30, 2026, which represented a 1% increase in growth rate of pets enrolled compared to the prior year period's growth rate of 4%. Revenue from our other business segment increased by $4.8 million, or 4%, to $116.2 million for the three months ended June 30, 2026. This increase was primarily driven by a 22% increase in monthly average revenue per pet in this segment, partially offset by a decrease in pet months primarily reflecting the expected run-off of pets we historically insured for Pets Best. Six months ended June 30, 2026 compared to six months ended June 30, 2025. Total revenue increased by $81.5 million, or 12%, to $777.0 million for the six months ended June 30, 2026. Revenue from our subscription business segment increased by $70.9 million, or 15%, to $546.1 million for the six months ended June 30, 2026. This increase was primarily due to a 10% increase in monthly average revenue per pet and an increase in subscription pet months for policies underwritten by Trupanion. Our subscription pets enrolled increased by 58,194 pets, or 5%, to 1,124,548 for the six months ended June 30, 2026, which represented a 1% increase in growth rate of pets enrolled compared to the prior year period's growth rate of 4%. Revenue from our other business segment increased by $10.5 million, or 5%, to $230.8 million for the six months ended June 30, 2026. This increase was primarily driven by a 22% increase in monthly average revenue per pet in this segment, partially offset by a decrease in pet months primarily reflecting the expected run-off of pets we historically insured for Pets Best. 32 Cost of Revenue Three Months Ended June 30, % Change Six Months Ended June 30, % Change 2026 2025 2026 2025 (in thousands, except percentages, pet and per pet data) Cost of Revenue: Subscription business: Veterinary invoice expense $ 194,803 $ 172,874 13 % $ 386,217 $ 341,055 13 % Other cost of revenue 25,451 22,614 13 50,489 44,278 14 Total cost of revenue 220,254 195,488 13 436,706 385,333 13 Other business: Veterinary invoice expense 84,665 82,706 2 174,687 161,975 8 Other cost of revenue 22,882 20,536 11 38,968 42,294 (8) Total cost of revenue $ 107,547 $ 103,242 4 $ 213,655 $ 204,269 5 Percentage of Revenue by Segment: Subscription business: Veterinary invoice expense 71 % 72 % 71 % 72 % Other cost of revenue 9 9 9 9 Total cost of revenue 80 81 80 81 Other business: Veterinary invoice expense 73 74 76 74 Other cost of revenue 20 19 17 19 Total cost of revenue 93 % 93 % 93 93 Total pets enrolled (at period end) 1,633,131 1,660,455 (2) 1,633,131 1,660,455 (2) Total subscription pets enrolled (at period end) 1,124,548 1,066,354 5 1,124,548 1,066,354 5 Three months ended June 30, 2026 compared to three months ended June 30, 2025. Total cost of revenue for our subscription business segment increased by $24.8 million, or 13%, to $220.3 million, for the three months ended June 30, 2026. This increase was driven by a $21.9 million, or 13%, increase in veterinary invoice expense and a $2.8 million, or 13%, increase in other cost of revenue. The 13% increase in veterinary invoice expense was driven by an 8% increase in veterinary invoice expense per pet and an increase in total subscription pet months for policies underwritten by Trupanion. The 13% increase in other cost of revenue was primarily due to general increases in costs attributable to growth in our membership and subscription revenue. Subscription business total cost of revenue decreased from 81% to 80% of revenue year-over-year primarily due to growth in subscription revenue outpacing growth in subscription veterinary invoice expense. Total cost of revenue for our other business segment increased by $4.3 million, or 4%, to $107.5 million for the three months ended June 30, 2026. This increase was primarily driven by a $2.0 million, or 2%, increase in veterinary invoice expense and a $2.3 million, or 11%, increase in other cost of revenue. The 2% increase in veterinary invoice expense was primarily driven by a 19% increase in veterinary invoice expense per pet, partially offset by a decrease in pet months in this segment primarily reflecting the expected run-off of pets we historically insured for Pets Best. Within our other business segment, fluctuations in other cost of revenue are largely driven by trends in revenue and veterinary invoice expense and remained materially consistent at 93% of segment revenue year-over-year. Six months ended June 30, 2026 compared to six months ended June 30, 2025. Total cost of revenue for our subscription business segment increased by $51.4 million, or 13%, to $436.7 million, for the six months ended June 30, 2026. This increase was driven by a $45.2 million, or 13%, increase in veterinary invoice expense and a $6.2 million, or 14%, increase in other cost of revenue. The 13% increase in veterinary invoice expense was driven by a 9% increase in veterinary invoice expense per pet and an increase in total subscription pet months for policies underwritten by Trupanion. The 14% increase in other cost of revenue was primarily due to general increases in costs attributable to growth in our membership and subscription revenue. Subscription business total cost of revenue decreased from 81% to 80% of revenue year-over-year primarily due to growth in 33 subscription revenue outpacing growth in subscription veterinary invoice expense. Total cost of revenue for our other business segment increased by $9.4 million, or 5%, to $213.7 million for the six months ended June 30, 2026. This increase was primarily driven by a $12.7 million, or 8%, increase in veterinary invoice expense and partially offset by a $3.3 million, or 8%, decrease in other cost of revenue. The 8% increase in veterinary invoice expense was primarily driven by a 25% increase in veterinary invoice expense per pet, partially offset by a decrease in pet months in this segment primarily reflecting the expected run-off of pets we historically insured for Pets Best. Within our other business segment, fluctuations in other cost of revenue are largely driven by trends in revenue and veterinary invoice expense and remained materially consistent at 93% of segment revenue year-over-year. Technology and Development Expenses Three Months Ended June 30, % Change Six Months Ended June 30, % Change 2026 2025 2026 2025 (in thousands, except percentages) (in thousands, except percentages) Technology and development $ 12,754 $ 8,586 49 % $ 24,048 $ 16,658 44 % Percentage of total revenue 3 % 2 % 3 % 2 % Three months ended June 30, 2026 compared to three months ended June 30, 2025. Technology and development expenses increased by $4.2 million, or 49%, to $12.8 million for the three months ended June 30, 2026. This increase was primarily due to a $1.4 million increase in stock-based compensation expenses primarily driven by a one-time award modification, a $0.9 million increase in new product exploration and development expense, a $0.8 million increase in general compensation and other employee-related expenses, a $0.6 million reduction in capitalized expenditures related to internally developed software projects, and a $0.5 million increase in IT infrastructure-related expenses. Technology and development expenses increased from 2% to 3% of total revenue year-over-year. Six months ended June 30, 2026 compared to six months ended June 30, 2025. Technology and development expenses increased by $7.4 million, or 44%, to $24.0 million for the six months ended June 30, 2026. This increase was primarily due to a $2.4 million increase in general compensation and other employee-related expenses, a $1.8 million increase in stock-based compensation expenses primarily driven by a one-time award modification, a $1.4 million reduction in capitalized expenditures related to internally developed software projects, a $1.1 million increase in new product exploration and development expenses, and a $0.7 million increase in IT infrastructure related expenses. Technology and development expenses increased from 2% to 3% of total revenue year-over-year. General and Administrative Expenses Three Months Ended June 30, % Change Six Months Ended June 30, % Change 2026 2025 2026 2025 (in thousands, except percentages) (in thousands, except percentages) General and administrative $ 19,525 $ 20,122 (3) % $ 38,627 $ 40,014 (3) % Percentage of total revenue 5 % 6 % 5 % 6 % Three months ended June 30, 2026 compared to three months ended June 30, 2025. General and administrative expenses decreased by $0.6 million, or 3%, to $19.5 million for the three months ended June 30, 2026. This decrease was primarily driven by decreases of $2.3 million in underwriting fees related to our Canadian business and $0.3 million in stock-based compensation expenses, partially offset by increases of $1.6 million in foreign consumption taxes and $0.3 million in other miscellaneous expenses. General and administrative expenses decreased from 6% to 5% of total revenue year-over-year. Six months ended June 30, 2026 compared to six months ended June 30, 2025. General and administrative expenses decreased by $1.4 million, or 3%, to $38.6 million for the six months ended June 30, 2026. This decrease was driven by decreases of $4.8 million in underwriting fees related to our Canadian business and $1.0 million in professional services, partially offset by increases of $1.9 million in foreign consumption taxes, $1.4 million in other miscellaneous expenses and $1.1 million in general compensation and other employee-related expenses. General and administrative expenses decreased from 6% to 5% of total revenue year-over-year. New Pet Acquisition Expense 34 Three Months Ended June 30, % Change Six Months Ended June 30, % Change 2026 2025 2026 2025 (in thousands, except percentages, pet and per pet data) New pet acquisition expense $ 22,805 $ 19,843 15 % $ 45,416 $ 40,359 13 % Percentage of total revenue 6 % 6 % 6 % 6 % Subscription Business: Total subscription pets enrolled (at period end) 1,124,548 1,066,354 5 1,124,548 1,066,354 5 Average pet acquisition cost (PAC) $ 299 $ 276 8 $ 307 $ 272 13 Three months ended June 30, 2026 compared to three months ended June 30, 2025. New pet acquisition expenses increased by $3.0 million, or 15%, to $22.8 million for the three months ended June 30, 2026. This increase was primarily driven by increased marketing spend as we have begun deploying more capital to acquire new pets in a disciplined manner. New pet acquisition expense as a percentage of revenue remained constant at 6%. Six months ended June 30, 2026 compared to six months ended June 30, 2025. New pet acquisition expenses increased by $5.1 million, or 13%, to $45.4 million for the six months ended June 30, 2026. This increase was primarily driven by increased marketing spend as we have begun deploying more capital to acquire new pets in a disciplined manner. New pet acquisition expense as a percentage of revenue remained constant at 6%. Depreciation and Amortization Three Months Ended June 30, % Change Six Months Ended June 30, % Change 2026 2025 2026 2025 (in thousands, except percentages) Depreciation and amortization $ 3,673 $ 3,962 (7) % $ 7,379 $ 7,753 (5) % Percentage of total revenue 1 % 1 % 1 % 1 % Three months ended June 30, 2026 compared to three months ended June 30, 2025. Depreciation and amortization expense decreased by $0.3 million, or 7%, to $3.7 million for the three months ended June 30, 2026, primarily driven by fewer internally developed software projects placed in-service during the period. Six months ended June 30, 2026 compared to six months ended June 30, 2025. Depreciation and amortization expense decreased by $0.4 million, or 5%, to $7.4 million for the six months ended June 30, 2026, primarily driven by fewer internally developed software projects placed in-service during the period. Total Other (Income), Net Three Months Ended June 30, % Change Six Months Ended June 30, % Change 2026 2025 2026 2025 (in thousands, except percentages) Interest expense $ 1,832 $ 3,682 (50) % $ 3,707 $ 6,893 (46) % Other (income), net (2,829) (11,914) (76) (5,884) (15,154) (61) Total other (income), net $ (997) $ (8,232) 88 $ (2,177) $ (8,261) (74) Percentage of total revenue — % (2) % — % (1) % Three months ended June 30, 2026 compared to three months ended June 30, 2025. Total other (income), net decreased by $7.2 million from income of $8.2 million to income of $1.0 million for the three months ended June 30, 2026, primarily due to a $7.8 million realized gain recognized on the nonmonetary exchange of our Baystride preferred stock investment for intellectual property during 2025 and an increase in foreign currency losses of $0.9 million. These decreases in income were partially offset by a decrease in interest expense of $1.9 million. 35 Six months ended June 30, 2026 compared to six months ended June 30, 2025. Total other (income), net decreased by $6.1 million from income of $8.3 million to income of $2.2 million for the six months ended June 30, 2026, primarily due to a $7.8 million realized gain on the nonmonetary exchange of our Baystride preferred stock investment for intellectual property developed by Baystride in 2025 and an increase in foreign currency losses of $1.6 million. These decreases in income were partially offset by a decrease in interest expense of $3.2 million. Income Tax Expense Three months ended June 30, 2026 compared to three months ended June 30, 2025. Income tax expense decreased $0.6 million from $1.1 million to $0.5 million for the three months ended June 30, 2026, primarily due to the initial transfer of our Canadian insurance business to GPIC in the prior year quarter, which resulted in a true-up to the annual effective tax rate for the three months ended June 30, 2025. Six months ended June 30, 2026 compared to six months ended June 30, 2025. Income tax expense increased $0.4 million from $1.2 million to $1.6 million for the six months ended June 30, 2026, primarily due to a change in the jurisdictional makeup of income and losses. 36 Liquidity and Capital Resources The following table summarizes our cash flows for the periods indicated (in thousands): Six Months Ended June 30, 2026 2025 Net cash provided by operating activities $ 35,578 $ 30,989 Net cash used in investing activities (22,430) (51,440) Net cash used in financing activities (5,308) (16,346) Effect of foreign exchange rate changes on cash, cash equivalents, and restricted cash, net (999) 1,738 Net change in cash, cash equivalents, and restricted cash $ 6,841 $ (35,059) Our primary requirements for liquidity are paying veterinary invoices, funding and growing our operations, funding our capital requirements, investing in new member acquisition, investing in enhancements to our member experience, and servicing debt. We have certain contractual obligations in the normal course of business, including obligations and commitments relating to our credit arrangements, non-cancellable vendor purchase agreements, as well as future payments of veterinary invoices. Refer to Note 7, Reserve for Veterinary Invoices, included in Item 1 of Part I of this report, for further details on anticipated cash outflows. Most recently, our primary source of liquidity has been cash provided by our operations. We believe our operating cash flow is sufficient to fund our operations and capital requirements for the next 12 months. As we continue to grow and consider strategic opportunities, however, we may explore additional financing to fund our operations and growth or for strategic purposes. Financing could include equity, equity-linked, or debt financing. Additional financing may not be available to us on acceptable terms, or at all. If our capital surplus grows relative to the rate of growth of our business, we may also generate cash for operations and growth via dividends or other methods, from one or more of our underwriting entities. As of June 30, 2026, we had $398.5 million in cash, cash equivalents and short-term investments, of which $344.1 million was held by our insurance entities. Outside of insurance entities, we held $54.4 million in cash, cash equivalents and short-term investments with an additional $3.5 million available under our PNC Facility. In April 2021, our board of directors (the "Board") approved a share repurchase program, pursuant to which we could repurchase outstanding shares of our common stock, between May 2021 and May 2026. In June 2026, the Board approved a new share repurchase program, pursuant to which we are authorized to repurchase up to an aggregate of $100.0 million of our outstanding shares of common stock, with no expiration date. We are not obligated to repurchase any specific number or dollar amount of shares, and the timing and actual number of shares repurchased will depend on a variety of factors, including our compliance with the PNC Facility, available cash, cash flow from operations, stock price, general economic, business and market conditions, and alternative investment opportunities. We repurchased no shares during the six months ended June 30, 2026. Operating Cash Flows Net cash provided by operating activities was $35.6 million for the six months ended June 30, 2026, compared to $31.0 million for the six months ended June 30, 2025. This increase was primarily driven by improved operating results largely driven by higher revenue and improved subscription business margins, partially offset by timing differences in working capital activities. Changes in accounts receivable and deferred revenue were primarily related to annual policies with annual payment terms within our other business segment. Changes in our reserve for veterinary invoices are driven by multiple factors, including ongoing analysis of claims frequency and severity. Additionally, changes in our accounts payable, accrued liabilities, and other liabilities are primarily due to differences in timing of payments. Investing Cash Flows Net cash used by investing activities was $22.4 million for the six months ended June 30, 2026, primarily consisting of purchases of investment securities of $120.0 million as well as $2.7 million of capital expenditures primarily related to the development of internal-use software focused on member experience, claims processing and internal policy management improvements, partially offset by $100.2 million in sales and maturities of investment securities. Net cash used in investing activities was $51.4 million for the six months ended June 30, 2025, primarily consisting of purchases of investment securities of $142.0 million as well as $4.9 million of capital expenditures primarily related to the development of internal-use software focused on member experience, claims processing and internal policy management improvements, partially offset by $94.3 million in sales and maturities of investment securities. 37 Financing Cash Flows Net cash used in financing activities was $5.3 million for the six months ended June 30, 2026, primarily consisting of $5.0 million in repayments on the PNC Facility. Net cash used in financing activities was $16.3 million for the six months ended June 30, 2025, primarily consisting of $15.5 million in repayments on the Prior Credit Facility, as well as $1.7 million in shares withheld to satisfy tax withholding, partially offset by $1.3 million in proceeds from exercise of stock options. Long-Term Debt PNC Facility In November 2025, we entered into a credit agreement (the "PNC Agreement") with PNC Bank, National Association, as the administrative agent. The PNC Agreement provides for a term loan facility of $100.0 million and a revolving credit facility of $20.0 million (collectively, the "PNC Facility"). The PNC Facility matures in November 2028. Loans under the PNC Facility bear interest at a reference rate plus an applicable margin, which will generally be the SOFR reference rate plus 2.75% per annum. We make quarterly principal payments of $2.5 million on the term loan facility. We may voluntarily prepay loans or reduce revolving commitments under the PNC Facility at any time without premium or penalty. The loans under the PNC Agreement are secured by substantially all of our assets. The PNC Agreement contains financial and other covenants, including quarterly financial ratios, and it includes limitations on, among other things, indebtedness, liens, investments, and mergers or similar transactions. Regulation The majority of our investments are held by our insurance entities to satisfy risk-based capital requirements (also referred to as minimum capital requirements) of applicable state and federal regulators. These regulatory requirements provide a method for analyzing the minimum amount of capital (statutory capital and surplus plus other adjustments) appropriate for an insurance company to support its overall business operations, taking into account the risk characteristics of the company’s assets, liabilities and certain other items. An insurance entity cannot use this capital for general operating expenses without regulatory approval. An insurance company found to have insufficient statutory capital based on its risk-based or minimum capital test requirements or otherwise fails to satisfy other applicable statutory requirements may be subject to varying levels of additional regulatory oversight. As of June 30, 2026, our insurance entities collectively held $94.9 million in cash and cash equivalents, to be used for operating expenses of our insurance entities, $249.2 million in short-term investments and $298.0 million in other current assets. The majority of the assets in our insurance entities are subject to certain capital and dividend rules and regulations prescribed by jurisdictions in which they are authorized to operate. We are subject to comprehensive regulation and supervision in the jurisdictions where we conduct business, including requirements regarding our capital structure, ownership, financial condition, general business operations, transactions between affiliated entities and payment of dividends from our insurance subsidiaries. We are also subject to market conduct examinations of our management and operations. The National Association of Insurance Commissioners ("NAIC") has approved a series of uniform statutory accounting principles applicable in some form in all states. Developed to ensure insurance companies maintain sufficient capital to pay claims and remain solvent, these principles conservatively value assets and liabilities and usually result in differences from financial statements prepared in accordance with U.S. GAAP. The NAIC has also adopted risk-based capital requirements for life, health and property and casualty insurance companies, which require APIC and ZPIC to maintain certain levels of surplus to support our overall business operations in consideration of our size and risk profile. If we fail to maintain the amount of risk-based capital required, we will be subject to additional regulatory oversight. To comply with these regulations, we may be required to maintain capital that we would otherwise invest in our growth and operations. NAIC also has adopted a pet insurance model act to establish regulatory standards for the pet insurance industry, related to how insurers enforce waiting periods, certain policy conditions, and the sale of pet insurance in general. Although U.S. federal law generally does not directly regulate the insurance industry, various federal regulatory and legislative changes have been proposed in the past and could be proposed in the future, including proposed federal regulation that could supplement or replace the current system of state regulation of insurers. It is not possible to predict whether any of these proposals might be adopted, or the effect federal involvement in insurance may have on us. American Pet Insurance Company ("APIC") APIC, our wholly-owned insurance subsidiary domiciled in New York, underwrites all of our policies in the U.S. As our business in the U.S. grows, the amount of capital we are required to maintain to satisfy our risk-based capital requirements will also increase, though risk-based capital requirements also take our overall rate of growth into consideration. Recently, our other business segment growth has slowed, and we currently expect that to continue, which would reduce capital requirements. In February 2026 and August 2026, APIC distributed extraordinary dividends of $14.9 million and $10.0 million to Trupanion, Inc., respectively. APIC's primary regulator is the New York Department of Financial Services ("NY DFS"). 38 ZPIC Insurance Company ("ZPIC") ZPIC, our wholly-owned insurance subsidiary domiciled in Missouri, has not yet begun underwriting activity, but we have funded its required statutory capital. We formed this insurance subsidiary to provide us flexibility as to the insurance entity we use to market and write policies in the United States. ZPIC's primary regulator is the Missouri Department of Commerce and Insurance ("MODCI"). GPIC Insurance Company ("GPIC") GPIC, our wholly-owned insurance subsidiary domiciled in Canada, underwrites the majority of our policies in Canada. We are continuing to transition the remaining portion of our insurance activity in Canada to GPIC from a fronting arrangement with Accelerant Insurance Company of Canada (formerly Omega General Insurance Company) ("Accelerant"). Pursuant to the Canadian Office of the Superintendent of Financial Institutions ("OSFI") regulations, we have contributed CAD $38.9 million to GPIC as of June 30, 2026, as the required statutory capital for this subsidiary. The capital we maintain at GPIC is, and for the foreseeable future may continue to be, more than the amount that we historically held subject to our fronting arrangement with Accelerant. Under the terms of our agreements with Accelerant, we retain any financial risk associated with our Canadian business. Accelerant's Canadian insurance operations are supervised and regulated by Canadian federal, provincial and territorial governments and Accelerant is a fully licensed insurer in all of the Canadian provinces and territories in which we do business. Wyndham Insurance Company (SAC) Limited ("WICL") Segregated Account AX, Wyndham Insurance Company (SAC) Limited Segregated Account Trupanion Germany and Wyndham Insurance Company (SAC) Limited Segregated Account Trupanion Switzerland WICL is domiciled in Bermuda and regulated by the Bermuda Monetary Authority ("BMA"). WICL Segregated Account AX was established by WICL, with Trupanion, Inc. as the shareholder, to enter into a reinsurance agreement with Accelerant for our business activity in Canada. All of the assets and liabilities of WICL Segregated Account AX are legally segregated from other assets and liabilities within WICL, and all shares of the segregated account are owned by Trupanion, Inc. Trupanion, Inc. received dividends of $3.3 million and $5.0 million from WICL Segregated Account AX in February and May 2026, respectively, as permitted under our agreements with WICL. As required by OSFI regulations related to our reinsurance agreement with Accelerant, we are required to maintain a Canadian Reinsurance Trust account with the greater of CAD $2.0 million or 120% of unearned Canadian premium plus 20% of outstanding Canadian claims, including all incurred but not reported claims. As of June 30, 2026, the account held CAD $2.0 million. WICL Segregated Account Trupanion Germany and WICL Segregated Account Trupanion Switzerland were established in the third quarter of 2024 by WICL, with Trupanion, Inc. as the shareholder, for purposes of entering into reinsurance agreements with underwriters in Germany and Switzerland, respectively. All of the assets and liabilities of WICL Segregated Account Trupanion Germany and WICL Segregated Account Trupanion Switzerland are legally segregated from other assets and liabilities within WICL, and all shares of the segregated accounts are owned by Trupanion, Inc. Though we are not directly regulated by the BMA, WICL's regulation and compliance impacts us as it could have an adverse impact on our ability to secure dividends from our WICL segregated accounts. WICL is regulated by the BMA under the Insurance Act of 1978 ("Insurance Act") and the Segregated Accounts Company Act of 2000. The Insurance Act imposes on Bermuda insurance companies, solvency and liquidity standards, certain restrictions on the declaration and payment of dividends and distributions, certain restrictions on the reduction of statutory capital, and auditing and reporting requirements, and grants the BMA powers to supervise and, in certain circumstances, to investigate and intervene in the affairs of insurance companies. Under the Insurance Act, WICL, as a class 3 insurer, is required to maintain available statutory capital and surplus at a level equal to or in excess of a prescribed minimum established by reference to net written premiums and loss reserves. Under the Bermuda Companies Act 1981, as amended, a Bermuda company may not declare or pay a dividend or make a distribution out of contributed surplus if there are reasonable grounds for believing that: (a) the company is, or would after the payment be, unable to pay its liabilities as they become due; or (b) the realizable value of the company’s assets would thereby be less than its liabilities. The Segregated Accounts Company Act of 2000 further requires that dividends out of a segregated account can only be paid to the extent that the account remains solvent and the value of its assets remain greater than the aggregate of its liabilities and its issued share capital and share premium accounts. Contractual Obligations We enter into long-term contractual obligations and commitments in the normal course of business, consisting primarily of debt obligations and non-cancellable vendor service agreements. In November 2025, we entered into the PNC Agreement, which provides up to $120.0 million of credit, including a $100.0 million term loan and a $20.0 million revolving loan facility. We used the proceeds under the PNC Agreement to repay all amounts due and outstanding under our Prior Credit Facility. The PNC Agreement will require us to repay the underlying obligations over a three-year term at SOFR plus a margin. Refer to Note 8, Debt, included in Item 1 of Part I of this report, for further details regarding the credit agreement, including interest and future principal repayments. 39 Critical Accounting Policies and Significant Estimates Our discussion and analysis of our financial condition and results of operations is based upon our consolidated financial statements, which have been prepared in accordance with GAAP. The preparation of these consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the consolidated financial statements, as well as the reported revenue and expenses during the reporting periods. Critical accounting policies and estimates are those that we consider the most important to the portrayal of our financial condition and results of operations because they require our most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain. Generally, we base our estimates on historical experience and on various other factors that we believe to be reasonable under the circumstances. Actual results may differ from these estimates. There have been no material changes to our critical accounting policies or estimates as compared to those described under the heading "Management's Discussion and Analysis of Financial Condition and Results of Operations - Critical Accounting Policies and Estimates" in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025. 40