"2024 was a landmark year for Root. We delivered in every facet of our operations, culminating in our first full year of net income profitability," - Alex Timm, CEO of Root Inc.
— Alex Timm
03Detailed Report
ROOT
Root Inc
Period
Q4 2024
CurrencyUSD
Report TypeQuarterly Earnings
GeneratedJun 20, 2026
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Executive Summary
Root Inc (ROOT) announced exceptional fourth quarter results, achieving net income profitability for the second consecutive quarter, a significant milestone in their operational journey. The company reported Q4 2024 revenue of $326.7 million, a substantial increase of 67.71% year-over-year and a 6.87% increase from Q3 2024. The net income of $22 million reflects a remarkable improvement of $46 million year-over-year, demonstrating a committed focus on disciplined underwriting and effective capital management.
In his remarks, CEO Alex Timm emphasized the company's strategic foundation laid in prior years, now leading to strong growth: "2024 was a landmark year for Root." The company showcased a gross loss ratio of 61% and a gross combined ratio of 91%. Additionally, Root expects to further capitalize on its success in 2025, expanding into new markets and channels and optimizing its technology for better customer acquisition.
Key Performance Indicators
Revenue
Increasing
326.70M
QoQ: 6.87% | YoY: 67.71%
Gross Profit
Increasing
326.70M
1.00% margin
QoQ: 6.87% | YoY: 67.71%
Operating Income
Increasing
34.90M
QoQ: 1.45% | YoY: 245.42%
Net Income
Increasing
20.90M
QoQ: -3.69% | YoY: 187.08%
EPS
Increasing
1.38
QoQ: -9.21% | YoY: 184.15%
Revenue Trend
Margin Analysis
Financial Highlights
Revenue Performance: Root achieved a Q4 2024 revenue of $326.7 million, up 67.71% year-over-year and 6.87% from Q3 2024, supported by a gross combined ratio of 91%. Net Income: The firm reported a net income of $22 million, translating to an EPS of $1.38, a massive increase from a net loss a year ago (Q4 2023: net loss of $24 million). Operating Metrics: Operating income rose to $35 million with an operating margin of 10.6%, affirming management’s continuing efforts in cost containment. The company ceded approximately 9% of its gross earned premium, illustrating strong risk management. Market Position: Policies in force grew 21% year-over-year, totaling over 414,000, showcasing the effectiveness of the company's marketing strategies. Cash Flow: Operating cash flow per share was $4.58 indicating robust cash generation and supporting further investments in growth. Liquidity Metrics: Although liquidity ratios (current ratio: 0; quick ratio: 0) indicate potential pressures, the management highlighted their overall fiscal discipline and efficiency in cash management.
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
326.70M
67.71%
6.87%
Gross Profit
326.70M
67.71%
6.87%
Operating Income
34.90M
245.42%
1.45%
Net Income
20.90M
187.08%
-3.69%
EPS
1.38
184.15%
-9.21%
Key Financial Ratios
Gross Profit Margin
Weak
1.00%
Gross profit margin is below industry norms, profitability concerns
Operating Profit Margin
Fair
10.70%
Operating margin is moderate, room for improvement in cost management
Net Profit Margin
Fair
6.40%
Net profit margin is moderate, room for improvement in cost management
Return on Assets
Weak
1.40%
Return on assets suggests inefficient capital allocation
Return on Equity
Fair
10.30%
Return on equity is acceptable but below top-tier companies