SelectQuote (SLQT) 10-Q 2025 Q2 Quarterly report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended December 31, 2024

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from   to

001-39295

(Commission File Number)

SelectQuote, Inc.

(Exact name of registrant as specified in its charter)

Delaware		94-3339273
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
6800 West 115th Street	Suite 2511	66211
Overland Park	Kansas	(Zip Code)
(Address of principal executive offices)

(913) 599-9225

(Registrant's telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.01 per share	SLQT	New York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).     Yes  ☒   No  ☐ 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☒
Non-accelerated filer	☐	Smaller reporting company	☒
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).Yes  ☐   No  ☒

The registrant had outstanding 172,144,283 shares of common stock as of January 31, 2025.

SELECTQUOTE, INC. AND SUBSIDIARIES

FORM 10-Q

TABLE OF CONTENTS

	PART I FINANCIAL INFORMATION	PAGE
Item 1.	Financial Statements (unaudited)
	Condensed Consolidated Balance Sheets as of December 31, 2024 and June 30, 2024	2
	Condensed Consolidated Statements of Comprehensive Income (Loss) for the Three and Six Months Ended December 31, 2024 and 2023	3
	Condensed Consolidated Statements of Changes in Shareholders’ Equity for the Three and Six Months Ended December 31, 2024 and 2023	4
	Condensed Consolidated Statements of Cash Flows for the Six Months Ended December 31, 2024 and 2023	6
	Notes to Condensed Consolidated Financial Statements	7
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	34
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	53
Item 4.	Controls and Procedures	53
	PART II OTHER INFORMATION
Item 1.	Legal Proceedings	54
Item 1A.	Risk Factors	54
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	54
Item 3.	Defaults Upon Senior Securities	54
Item 4.	Mine Safety Disclosures	54
Item 5.	Other Information	54
Item 6.	Exhibits	55
	Signatures	56

PART I

FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

SELECTQUOTE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In thousands)

	December 31, 2024		June 30, 2024
ASSETS
CURRENT ASSETS:
Cash and, cash equivalents, and restricted cash	$	12,104	$	42,690
Accounts receivable, net of allowances of $12.1 million and $8.2 million, respectively	115,795		150,035
Commissions receivable-current	224,787		119,871
Other current assets	19,686		20,327
Total current assets	372,372		332,923
COMMISSIONS RECEIVABLE—Net	812,037		761,446
PROPERTY AND EQUIPMENT—Net	16,257		18,973
SOFTWARE—Net	14,127		13,978
OPERATING LEASE RIGHT-OF-USE ASSETS	22,002		23,437
INTANGIBLE ASSETS—Net	8,130		10,194
GOODWILL	29,438		29,438
OTHER ASSETS	4,804		3,519
TOTAL ASSETS	$	1,279,167	$	1,193,908
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable	$	87,165	$	36,587
Accrued expenses	12,617		16,904
Accrued compensation and benefits	55,666		57,594
Operating lease liabilities—current	4,981		4,709
Current portion of long-term debt	27,577		45,854
Contract liabilities	954		8,066
Other current liabilities	5,440		4,873
Total current liabilities	194,400		174,587
LONG-TERM DEBT, NET—less current portion	684,284		637,480
DEFERRED INCOME TAXES	31,868		37,478
OPERATING LEASE LIABILITIES	23,539		25,685
OTHER LIABILITIES	19,074		1,877
Total liabilities	953,165		877,107
COMMITMENTS AND CONTINGENCIES (Note 9)
SHAREHOLDERS’ EQUITY:
Common stock, $0.01 par value	1,721		1,694
Additional paid-in capital	585,360		580,764
Accumulated deficit	(261,079)		(269,769)
Accumulated other comprehensive income (loss)	—		4,112
Total shareholders’ equity	326,002		316,801
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	1,279,167	$	1,193,908

            

See accompanying notes to the condensed consolidated financial statements.

SELECTQUOTE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(Unaudited)

(In thousands)

	Three Months Ended December 31,				Six Months Ended December 31,
	2024		2023		2024		2023
REVENUE:
Commissions and other services	$	301,069	296,643		$	440,449	$	434,584
Pharmacy	180,000		108,795		332,883		203,583
Total revenue	481,069		405,438		773,332		638,167
OPERATING COSTS AND EXPENSES:
Cost of commissions and other services revenue	101,138		97,424		166,872		169,935
Cost of goods sold—pharmacy revenue	156,201		94,180		285,724		178,188
Marketing and advertising	97,725		117,078		161,489		179,400
Selling, general, and administrative	45,021		33,412		81,166		62,078
Technical development	10,044		8,050		19,119		15,687
Total operating costs and expenses	410,129		350,144		714,370		605,288
INCOME FROM OPERATIONS	70,940		55,294		58,962		32,879
INTEREST EXPENSE, NET	(23,721)		(24,415)		(46,752)		(45,811)
OTHER EXPENSE, NET	(7,663)		—		(7,674)		(39)
INCOME (LOSS) BEFORE INCOME TAX EXPENSE (BENEFIT)	39,556		30,879		4,536		(12,971)
INCOME TAX EXPENSE (BENEFIT)	(13,680)		11,487		(4,154)		(1,312)
NET INCOME (LOSS)	$	53,236	$	19,392	$	8,690	$	(11,659)
NET INCOME (LOSS) PER SHARE:
Basic	$	0.31	$	0.12	$	0.05	$	(0.07)
Diluted	$	0.30	$	0.11	$	0.05	$	(0.07)
WEIGHTED-AVERAGE COMMON STOCK OUTSTANDING USED IN PER SHARE AMOUNTS:
Basic	171,802		168,349		171,116		167,901
Diluted	175,101		169,737		175,024		167,901
OTHER COMPREHENSIVE LOSS NET OF TAX:
Change in cash flow hedge	$	(1,327)	$	(3,422)	$	(4,112)	$	(5,432)
OTHER COMPREHENSIVE LOSS	(1,327)		(3,422)		(4,112)		(5,432)
COMPREHENSIVE INCOME (LOSS)	$	51,909	$	15,970	$	4,578	$	(17,091)

    

See accompanying notes to the condensed consolidated financial statements.

SELECTQUOTE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY

(Unaudited)

(In thousands)

Three Months Ended December 31, 2024
	Common Stock			Additional Paid-In Capital		Retained Earnings / (Accumulated Deficit)		Accumulated Other Comprehensive Income		Total Shareholders' Equity
	Shares	Amount
BALANCES-September 30, 2024	171,497	$	1,715	$	580,712	$	(314,315)	$	1,327	$	269,439
Net income	—	—		—		53,236		—		53,236
Loss on cash flow hedge, net of tax	—	—		—		—		(393)		(393)
Amount reclassified into earnings, net of tax	—	—		—		—		(934)		(934)
Exercise of employee stock options, net of shares withheld for cashless exercises and to cover tax withholdings	5	—		—		—		—		—
Vesting of restricted stock unit awards and performance stock unit awards net of shares withheld to cover tax withholdings	624	6		(51)		—		—		(45)
Share-based compensation expense	—	—		4,699		—		—		4,699
BALANCES-December 31, 2024	172,126	$	1,721	$	585,360	$	(261,079)	$	—	$	326,002

Three Months Ended December 31, 2023
	Common Stock			Additional Paid-In Capital		Accumulated Deficit		Accumulated Other Comprehensive Income		Total Shareholders' Equity
	Shares	Amount
BALANCES-September 30, 2023	167,731	$	1,677	$	570,087	$	(266,695)	$	11,669	$	316,738
Net income	—	—		—		19,392		—		19,392
Loss on cash flow hedge, net of tax	—	—		—		—		(770)		(770)
Amount reclassified into earnings, net tax	—	—		—		—		(2,652)		(2,652)
Vesting of restricted stock unit awards and performance stock unit awards net of shares withheld to cover tax withholdings	1,243	13		(26)		—		—		(13)
Share-based compensation expense	—	—		3,822		—		—		3,822
BALANCES-December 31, 2023	168,974	$	1,690	$	573,883	$	(247,303)	$	8,247	$	336,517

See accompanying notes to the condensed consolidated financial statements.

Six Months Ended December 31, 2024
	Common Stock			Additional Paid-In Capital		Retained Earnings/(Accumulated Deficit)		Accumulated Other Comprehensive Income (Loss)		Total Shareholders' Equity
	Shares	Amount
BALANCES-June 30, 2024	169,385	$	1,694	$	580,764	$	(269,769)	$	4,112	$	316,801
Net income	—	—		—		8,690		—		8,690
Loss on cash flow hedge, net of tax	—	—		—		—		(432)		(432)
Amount reclassified into earnings, net of tax	—	—		—		—		(3,680)		(3,680)
Exercise of employee stock options, net of shares withheld for cashless exercises and to cover tax withholdings	47	—		38		—		—		38
Vesting of restricted stock unit awards net of shares withheld to cover tax withholdings	2,579	26		(3,717)		—		—		(3,691)
Vesting of price vested unit awards net of shares withheld to cover tax withholdings	115	1		(270)		—		—		(269)
Share-based compensation expense	—	—		8,545		—		—		8,545
BALANCES-December 31, 2024	172,126	$	1,721	$	585,360	$	(261,079)	$	—	$	326,002

Six Months Ended December 31, 2023
	Common Stock			Additional Paid-In Capital		Accumulated Deficit		Accumulated Other Comprehensive Income		Total Shareholders' Equity
	Shares	Amount
BALANCES-June 30, 2023	166,867	$	1,669	$	567,266	$	(235,644)	$	13,679	$	346,970
Net loss	—	—		—		(11,659)		—		(11,659)
Gain on cash flow hedge, net of tax	—	—		—		—		71		71
Amount reclassified into earnings, net of tax	—	—		—		—		(5,503)		(5,503)
Vesting of restricted stock unit awards and performance stock unit awards net of shares withheld to cover tax withholdings	2,107	21		(380)		—		—		(359)
Share-based compensation expense	—	—		6,997		—		—		6,997
BALANCES-December 31, 2023	168,974	$	1,690	$	573,883	$	(247,303)	$	8,247	$	336,517

See accompanying notes to the condensed consolidated financial statements.

SELECTQUOTE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(In thousands)

	Six Months Ended December 31,
	2024		2023
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	$	8,690	$	(11,659)
Adjustments to reconcile net income (loss) to net cash, cash equivalents, and restricted cash used in operating activities:
Depreciation and amortization	10,659		11,887
Loss on disposal of property, equipment, and software	157		9
Share-based compensation expense	8,545		6,997
Deferred income taxes	(4,154)		(1,182)
Amortization of debt issuance costs and debt discount	2,379		3,356
Write-off of debt issuance costs	93		—
Accrued interest payable in kind	9,673		9,020
Change in fair value of warrant liabilities	7,642		—
Non-cash lease expense	1,846		1,528
Bad debt expense	4,203		2,743
Changes in operating assets and liabilities:
Accounts receivable, net	30,038		9,232
Commissions receivable	(155,507)		(113,860)
Other assets	(4,802)		(2,075)
Accounts payable and accrued expenses	46,211		29,206
Operating lease liabilities	(2,285)		(2,689)
Other liabilities	(8,692)		8,248
Net cash used in operating activities	(45,304)		(49,239)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment	(741)		(2,062)
Proceeds from sales of property and equipment	—		253
Purchases of software and capitalized software development costs	(4,105)		(3,883)
Net cash used in investing activities	(4,846)		(5,692)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from Revolving Credit Facility	84,900		—
Payments on Revolving Credit Facility	(26,900)		—
Payments on Term Loans	(123,215)		(16,942)
Proceeds on ABS Notes	99,095		—
Payments on ABS Notes	(6,272)		—
Payments on other debt	(114)		(75)
Proceeds from common stock options exercised and employee stock purchase plan	38		—
Payments of tax withholdings related to net share settlement of equity awards	(3,960)		(359)
Payments of debt issuance costs	(2,479)		—
Net cash provided (used in) financing activities	21,093		(17,376)
NET DECREASE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH	(29,057)		(72,307)
CASH, CASH EQUIVALENTS AND RESTRICTED CASH —Beginning of period	42,690		83,156
CASH, CASH EQUIVALENTS AND RESTRICTED CASH —End of period	$	13,633	$	10,849

SUPPLEMENTAL CASH FLOW INFORMATION:
Interest paid, net	$	(35,183)	$	(32,943)
Payment of income taxes, net	(3,115)		(185)
SUPPLEMENTAL DISCLOSURES OF NONCASH INVESTING AND FINANCING ACTIVITIES:
Capital expenditures in accounts payable and accrued expenses	187		555
Issuance of liability classified warrants	8,628		—

See accompanying notes to the condensed consolidated financial statements.

SELECTQUOTE, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1.SUMMARY OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES

Description of Business—SelectQuote, Inc. (together with its subsidiaries, the “Company” or “SelectQuote”) is a leading technology-enabled, direct-to-consumer distribution platform for selling insurance policies and healthcare services. We contract with insurance carriers to sell senior health, life, and auto and home insurance policies by telephone to individuals throughout the United States through the use of multi-channel marketing and advertising campaigns. SelectQuote’s Senior division (“Senior”) sells Medicare Advantage, Medicare Supplement, Medicare Part D, and other ancillary senior health insurance related products, and also includes a small lead generation business, InsideResponse, LLC (“InsideResponse”). SelectQuote’s Life division (“Life”) sells term life, final expense, and other ancillary products, and SelectQuote’s Auto & Home division (“Auto & Home”) primarily sells non-commercial auto and home, property and casualty insurance products. The Healthcare Services division (“Healthcare Services”) includes SelectRx, Population Health, and most recently, SelectPatient Management (“SPM”). SelectRx is a Patient-Centered Pharmacy HomeTM (“PCPH”) accredited pharmacy, which offers essential prescription medications, OTC medications, customized medication packaging, and medication therapy management. Population Health uses data from personal Health Risk Assessments completed by our agents (“HRAs”) to connect the consumer to the relevant health-related service, like SelectRx, SPM, or one of our many health-related partners. SPM launched in 2024 from the acquisition of an existing chronic care management platform, helps patients navigate their chronic conditions and manage them using a comprehensive treatment plan.

Basis of Presentation—The accompanying unaudited condensed consolidated financial statements include the accounts of SelectQuote, Inc., and its wholly owned subsidiaries: SelectQuote Insurance Services, SelectQuote Auto & Home Insurance Services, LLC, ChoiceMark Insurance Services, Inc., Tiburon Insurance Services, InsideResponse, and SelectQuote Ventures, Inc. The unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial information and reflect all normal recurring adjustments that are necessary to present fairly the results for the interim periods presented. All intercompany accounts and transactions have been eliminated in consolidation. Certain information and disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been condensed or omitted in accordance with those rules and regulations and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. The unaudited condensed consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements in our Annual Report on Form 10-K for the year ended June 30, 2024, filed with the Securities and Exchange Commission on September 13, 2024 (the “Annual Report”), and include all adjustments necessary for the fair presentation of our financial position for the periods presented. Our results for the periods presented in our financial statements are not necessarily indicative of the results to be expected for any subsequent period, including for the year ending June 30, 2025, and therefore should not be relied upon as an indicator of future results. The accompanying unaudited condensed consolidated financial statements and related notes should be read in conjunction with the audited consolidated financial statements for the year ended June 30, 2024.

Seasonality—Medicare-eligible individuals are permitted to change their Medicare Advantage and Medicare Part D Prescription Drug coverage for the following year during the Medicare annual enrollment period (“AEP”) in October through December and are allowed to switch plans from an existing plan during the open enrollment period (“OEP”) in January through March each year. As a result, the Senior segment’s revenue is highest in the second and third quarters.

Use of Estimates—The preparation of condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of revenues, expenses, assets, and liabilities and disclosure of contingent assets and liabilities. The Company regularly assesses these estimates; however, actual amounts could differ from those estimates. The most significant items involving management’s estimates include estimates of revenue recognition, accounts receivable, net, commissions receivable, the provision for income taxes, share-based

compensation, and valuation of intangible assets and goodwill. The impact of changes in estimates is recorded in the period in which they become known.

Significant Accounting Policies—Apart from the below, there have been no material changes to the Company’s significant accounting policies as described in our Annual Report.

Warrants—The Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in ASC 480, Distinguishing Liabilities from Equity (“ASC 480”), and ASC 815, Derivatives and Hedging (“ASC 815”). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to our own common shares and whether the warrant holders could potentially require “net cash settlement” in a circumstance outside of our control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent reporting period.

Cash, Cash Equivalents, and Restricted Cash—Cash and cash equivalents represent cash and short-term, highly liquid investments with maturities of three months or less at the time of purchase. Cash equivalents include a money market account primarily invested in cash and U.S. Government securities. These investments are generally classified as Level 1 fair value measurements, which represent unadjusted quoted market prices in active markets for identical assets or liabilities. Our account balances can at times exceed the FDIC-insured limits. The Company’s restricted cash balance consists of specified deposit accounts to be used only to fund payments related to the Notes (as defined in Note 6) entered into on October 15, 2024. The following table summarizes the cash, cash equivalents and restricted cash included on the condensed consolidated balance sheet.

(in thousands)	December 31, 2024		June 30, 2024
Current assets:
Cash and cash equivalents	$	7,315	$	42,690
Restricted cash - current	4,789		—
Total current assets	12,104		42,690
Other assets:
Other assets	1,529		—
Total cash, cash equivalents and restricted cash	$	13,633	$	42,690

Recent Accounting Pronouncements—In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2023-07 – Segment Reporting (Topic ASC 280) Improvements to Reportable Segment Disclosures, which improves reportable segment disclosure requirements, primarily through enhanced disclosure about significant segment expenses. The enhancements under this update 1) require disclosure of significant segment expenses that are regularly provided to the chief operating decision maker (“CODM”) and included within each reported measure of segment profit or loss, 2) require disclosure of other segment items by reportable segment and a description of the composition of other segment items 3) require annual disclosures to also be provided in interim periods, 4) clarify use of more than one measure of segment profit or loss by the CODM, 5) require that the title of the CODM be disclosed and an explanation of how the CODM uses the reported measures of segment profit or loss to make decisions, and 6) require that entities with a single reportable segment provide all disclosures required by this update and required under ASC 280. ASU 2023-07 is effective for public business entities for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. The Company is currently evaluating the impact of this ASU on its financial statements.

In December 2023, the FASB issued ASU No. 2023-09 – Income Taxes (Topic ASC 740) Income Taxes. This ASU improves the transparency of income tax disclosures by requiring (1) consistent categories and greater

disaggregation of information in the rate reconciliation and (2) income taxes paid disaggregated by jurisdiction. It also includes certain other amendments to improve the effectiveness of income tax disclosures. The amendments in ASU 2023-09 are effective for annual periods beginning after December 15, 2024. This change will apply on a prospective basis to annual financial statements for periods beginning after the effective date. However, retrospective application in all prior periods presented is permitted. The Company is currently evaluating the impact of this ASU on its financial statements.

In November 2024, the FASB issued ASU No. 2024-03 - Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40). The amendments in this ASU require a public business entity to disclose specific information about certain costs and expenses in the notes to its financial statements for interim and annual reporting periods. The objective of the disclosure requirements is to provided disaggregated information about a public business entity's expenses to help investors (a) better understand the entity's performance, (b) better assess the entity's prospects for future cash flows, and (c) compare an entity's performance over time and with that of other entities. The additional disclosures under this update include (1) disclosing the amounts of purchases of inventory, employee compensation, depreciation, intangible asset amortization, and depreciation, depletion, and amortization recognized as part of oil and gas-producing activities (DD&A) (or other amounts of depletion expense) that are included in each relevant expense caption, (2) include certain amounts that are already required to be disclosed under current generally accepted accounting principles (GAAP) in the same disclosure as the other disaggregation requirements, (3) disclose a qualitative description of the amounts remaining in relevant expense captions that are not separately disaggregated quantitatively, and (4) disclose the total amount of selling expenses and, in annual reporting periods, an entity’s definition of selling expenses. The amendments in this ASU are effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating the impact of this ASU on its financial statements.

2.PROPERTY AND EQUIPMENT—NET

Property and equipment—net consisted of the following:

(in thousands)	December 31, 2024		June 30, 2024
Computer hardware	$	17,902	$	18,036
Machinery and equipment(1)	17,590		16,451
Leasehold improvements	18,971		18,870
Furniture and fixtures	4,735		4,705
Work in progress	271		308
Total	59,469		58,370
Less accumulated depreciation(2)	(43,212)		(39,397)
Property and equipment—net	$	16,257	$	18,973

(1) Includes financing lease right-of-use assets.

(2) During the six months ended December 31, 2024, the Company disposed of $0.7 million of fully depreciated computer hardware.

Work in progress as of December 31, 2024 and June 30, 2024, primarily represents equipment utilized in SelectRx operations not yet put into service and not yet being depreciated. Depreciation expense for the three months ended December 31, 2024 and 2023, was $2.1 million and $3.0 million, respectively, and $4.6 million and $6.1 million for the six months ended December 31, 2024 and 2023, respectively.

3.SOFTWARE—NET

Software—net consisted of the following:

(in thousands)	December 31, 2024		June 30, 2024
Software	$	26,428	$	28,287
Work in progress	3		78
Total	26,431		28,365
Less accumulated amortization(1)	(12,304)		(14,387)
Software—net	$	14,127	$	13,978

(1) During the six months ended December 31, 2024, the Company disposed of $6.2 million of fully amortized software.

Work in progress represents costs incurred for software not yet put into service and not yet being amortized. For the three months ended December 31, 2024 and 2023, the Company capitalized internal-use software and website development costs of $2.1 million and $1.9 million, respectively, and recorded amortization expense of $2.0 million and $2.2 million, respectively. For the six months ended December 31, 2024 and 2023, the Company capitalized internal-use software and website development costs of $4.3 million and $3.8 million, respectively, and recorded amortization expense of $4.0 million and $4.2 million, respectively.

4.LEASES

The majority of the Company’s leases are operating leases related to office space for which the Company recognizes lease expense on a straight-line basis over the respective lease term. The Company leases office facilities in the United States in San Diego, CA; Centennial, CO; Overland Park, KS; Oakland, CA; Indianapolis, IN; and Monaca, PA. The Company's operating leases have remaining lease terms of less than one year up to twelve years. SelectRx leases the Monaca facility from an Executive Vice President of SelectRx. The Company expects to incur $3.6 million in total rental payments over the initial ten-year term plus an additional five-year extension option that it is reasonably certain to exercise.

During the six months ended December 31, 2024, the Company entered into four finance leases for equipment with commencement dates August 1, 2024 and September 19, 2024, resulting in new right-of-use assets obtained in exchange for new lease liabilities of $1.3 million.

Lease Costs—The components of lease costs were as follows for the periods presented:

	Three Months Ended December 31,				Six Months Ended December 31,
(in thousands)	2024		2023		2024		2023
Finance lease costs(1)	$	151	$	41	$	249	$	84
Operating lease costs(2)	1,767		1,516		3,517		3,100
Short-term lease costs	63		61		125		122
Variable lease costs(3)	135		160		282		295
Sublease income	(550)		(574)		(1,113)		(1,147)
Total net lease costs	$	1,566	$	1,204	$	3,060	$	2,454

(1) Primarily consists of amortization of finance lease right-of-use assets and an immaterial amount of interest on finance lease liabilities recorded in selling, general, and administrative expense and interest expense, net in the condensed consolidated statements of comprehensive income (loss).

(2) Recorded in selling, general, and administrative expense in the condensed consolidated statements of comprehensive income (loss).

(3) Variable lease costs are not included in the measurement of the lease liability or right-of-use asset as they are not based on an index or rate and primarily represents common area maintenance charges and real estate taxes recorded in operating costs and expenses in the condensed consolidated statements of comprehensive income (loss).

Maturities of Lease Liabilities—As of December 31, 2024, remaining maturities of lease liabilities for each of the next five fiscal years and thereafter are as follows:

(in thousands)	Operating leases		Finance leases		Total
Remainder fiscal 2025	$	4,095	$	237	$	4,332
2026	7,567		400		7,967
2027	6,682		393		7,075
2028	6,049		362		6,411
2029	6,127		362		6,489
Thereafter	8,827		30		8,857
Total undiscounted lease payments	39,347		1,784		41,131
Less: interest	10,827		444		11,271
Present value of lease liabilities	$	28,520	$	1,340	$	29,860

Sublease income—The Company executed noncancelable subleases for portions of its office facilities in Overland Park, KS and Centennial, CO, which commenced during the fiscal years ended June 30, 2023 and 2022, and run through July 31, 2029, and November 30, 2026, respectively. Sublease income is recorded on a straight-line basis as a reduction of lease expense in the condensed consolidated statements of comprehensive income (loss). The Company may consider entering into additional sublease arrangements in the future.

As of December 31, 2024, the future minimum fixed sublease receipts under non-cancelable operating lease agreements are as follows:

(in thousands)	Total
Remainder fiscal 2025	$	1,281
2026	2,587
2027	2,180
2028	1,931
2029	1,931
Thereafter	161
Total sublease income	$	10,071

5.INTANGIBLE ASSETS AND GOODWILL

Intangible assets—The carrying amounts, accumulated amortization, net carrying value, and weighted average remaining life of our definite-lived amortizable intangible assets are presented below (dollars in thousands, useful life in years):

	December 31, 2024						June 30, 2024
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount			Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Customer relationships	$	17,492	$	(12,094)	$	5,398		$	17,492	$	(10,936)	$	6,556
Trade name	2,680		(2,501)		179			2,680		(2,233)		447
Proprietary software	4,342		(1,817)		2,525			4,342		(1,189)		3,153
Non-compete agreements	100		(72)		28			100		(62)		38
Total intangible assets	$	24,614	$	(16,484)	$	8,130		$	24,614	$	(14,420)	$	10,194

The Company's intangible assets include those long-lived intangible assets acquired as part of acquisitions. The Company reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. There were no impairment triggers identified with respect to the Company’s long-lived assets during the three and six months ended December 31, 2024 and 2023.

For the three months ended December 31, 2024 and 2023, amortization expense related to intangible assets totaled $1.0 million and $0.8 million, respectively, and $2.1 million and $1.5 million for the six months ended December 31, 2024 and 2023, respectively, recorded in selling, general and administrative expense in the condensed consolidated statements of comprehensive income (loss). The weighted-average remaining useful life of intangible assets was 2.49 and 2.69 years as of December 31, 2024 and June 30, 2024, respectively.

As of December 31, 2024, expected amortization expense in future fiscal periods were as follows (in thousands):

	Trade Name		Proprietary Software		Non-compete agreements		Customer relationships		Total
Remainder fiscal 2025	$	179	$	600	$	10	$	1,158	$	1,947
2026	—		1,100		18		2,313		3,431
2027	—		825		—		1,927		2,752
Total	$	179	$	2,525	$	28	$	5,398	$	8,130

Goodwill—The Company recorded as goodwill the excess of the purchase price over the estimated fair values of identifiable assets and liabilities acquired as part of prior period acquisitions. Goodwill is assigned to reporting units that are expected to benefit from the synergies of the business combination as of the acquisition date and becomes identified with that reporting unit in its entirety. As such, the reporting unit as a whole supports the recovery of its goodwill. As of December 31, 2024, the Company’s goodwill balance of $29.4 million was related to the acquisitions of Express Meds, Simple Meds, and SelectPatient Management and is all assigned to the Healthcare Services reporting unit and reportable segment.

The Company performs its annual goodwill impairment testing as of April 1, or more frequently if it believes that indicators of impairment exist. During the three and six months ended December 31, 2024 and 2023, there were no indicators of impairment.

6.DEBT

Debt consisted of the following:

(in thousands)	December 31, 2024		June 30, 2024
Revolving credit facility	$	58,000	$	—
Term Loans	574,662		688,203
Class A Notes	56,237		—
Class B Notes	37,491		—
Unamortized debt issuance costs and debt discount	(14,529)		(4,869)
Total debt	711,861		683,334
Less current portion of long-term debt:	(27,577)		(45,854)
Long-term debt	$	684,284	$	637,480

The combined aggregate amount of expected payments associated with the Notes and maturities associated with the Term Loans as of December 31, 2024 are as follows:

(in thousands)	Remainder fiscal 2025		2026		2027		2028		2029		Total
Revolving credit facility	$	—	$	58,000	$	—	$	—	$	—	$	58,000
Term Loans	$	5,002	$	14,291	$	28,582	$	526,787	$	—	$	574,662
Class A Notes	$	6,183	$	11,717	$	10,593	$	8,650	$	19,094	$	56,237
Class B Notes	4,122		7,811		7,062		5,767		12,729		37,491
Total obligations	$	15,307	$	91,819	$	46,237	$	541,204	$	31,823	$	726,390

As of December 31, 2024, the Company was in compliance with all financial covenants pursuant its debt obligations.

Significant changes in the Company’s debt during the six months ended December 31, 2024 were as follows:

Senior Secured Credit Facility

On November 5, 2019, the Company entered into a credit agreement (together with any subsequent amendments, the “Senior Secured Credit Facility”) with Wilmington Trust, National Association, as administrative agent, UMB Bank, N.A., as revolver agent and revolving lender, and the other lenders party thereto. The Senior Secured Credit Facility, through additional amendments in subsequent years, has provided for total proceeds from borrowings of $887.3 million (the “Term Loans”) and a revolving credit facility with $13.7 million available to borrow as of December 31, 2024 (the “Revolving Credit Facility”).

On September 12, 2024, the Company entered into a tenth amendment (the “Tenth Amendment”) to its Credit Agreement. The Tenth Amendment, among other things, (1) established a new class of consenting term loans and extended the maturity date to September 15, 2025, (2) established a second class of non-extended Term Loans with a maturity date of May 15, 2025, and (3) modified or added certain financial covenant ratios required to be maintained by the Company as of various reporting dates. Pursuant to the amendment, the Company paid fees of $0.7 million to its lenders.

On October 15, 2024, the Company entered into an eleventh amendment (the “Eleventh Amendment”) to its Credit Agreement to (1) extend the scheduled maturity date of the consenting Term Loans to September 30, 2027, (2) modify financial covenant ratios required to be maintained by the Company as of various reporting dates, and (3) allow the Company to enter into the Indenture (as defined below). Prior to the Eleventh Amendment, the Company fully repaid the non-extended Term Loans in the amount of $14.2 million on October 15, 2024. The obligations of the Company under the Senior Secured Credit Facility continue to be guaranteed by certain of the Company’s subsidiaries and secured by a security interest in the assets of the Company, subject to certain exceptions. In connection with the Eleventh Amendment and Indenture (as defined below), the Company issued an aggregate 5,568,360 warrants to the term lenders under the Senior Secured Credit Facility (the “Eleventh Amendment Warrants”). Refer to Note 7 to the condensed consolidated financial statements for further details on the Eleventh Amendment Warrants.

The Term Loans bear interest on the outstanding principal amount thereof at a rate per annum equal to either, at the Company’s option, (a) SOFR (subject to a floor of 3.00%) plus 6.50% in cash and 3.00% payable in kind, or (b) a base rate plus 5.50% in cash and 3.00% payable in kind. The effective interest rate for the Term Loans as of December 31, 2024 was 13.9%. In accordance with the Eleventh Amendment, the interest rate may increase if the Company fails to achieve certain milestone payments by March 31, 2025 and June 30, 2025. The Revolving Credit Facility accrues interest on amounts drawn at a rate per annum equal to either, at the Company’s option, (a) SOFR (subject to a floor of 1.0%) plus 5.0% or (b) a base rate plus 4.0%. The effective interest rate for the Revolving Credit Facility as of December 31, 2024 was 11.5%

Securitization and Indenture

On October 15, 2024, the Company and certain of its subsidiaries, including SQ ABS Issuer, LLC (the “Issuer”), a special purpose entity and wholly-owned subsidiary of the Company, entered into a Note Purchase Agreement (the “Note Purchase Agreement”) with the purchasers party thereto (the “Purchasers”). Pursuant to the Note Purchase Agreement, the Issuer issued $60.0 million of senior secured 7.80% Class A Notes and $40.0 million of senior secured 9.65% Class B Notes (together the “Notes”) to the Purchasers. The Notes are governed by an Indenture, dated as of October 15, 2024, with UMB Bank, N.A. as indenture trustee (the “Indenture”). The Notes have a final legal maturity of October 20, 2039 and an anticipated repayment date of September 20, 2028. The Company used the proceeds obtained from the issuance of the Notes to repay a portion of its outstanding Term Loans in conjunction with the Eleventh Amendment.

The Notes are secured by a specified pool of renewal commissions that include both accounts receivable for policy renewals as well as commissions receivable for estimated future policy renewals (collectively, the “Subject Renewal Commissions”). The Subject Renewal Commissions are associated with underlying Medicare Advantage policies effective prior to January 1, 2024 and active as of August 31, 2024. As of December 31, 2024, there were $25.6 million and $75.5 million of Subject Renewal Commissions included in short-term commissions receivable and long-term commissions receivable, respectively, on the condensed consolidated balance sheet.

Under the terms of the Indenture, the Company services the transferred Subject Renewal Commissions, and the related collections are remitted to a segregated bank account. The funds in the segregated account are used only to fund payments related to the Indenture and is considered restricted cash. The restricted cash balance included within cash, cash equivalents, and restricted cash on the Company’s condensed consolidated balance sheet as of December 31, 2024 was $6.3 million.

The Notes contain covenants that, among other things, limit the ability of the Issuer to: (i) sell, transfer, or dispose of assets without the consent of a majority of the noteholders, (ii) create or permit liens on its assets (other than certain permitted liens) and (iii) incur indebtedness (other than permitted indebtedness).

The Notes issued in connection with the Indenture bear interest on the unpaid principal amount at 7.80% and 9.65% for Class A and Class B Notes, respectively. The Notes amortize based on a target loan-to-value calculation, and if any Notes remain outstanding after September 2028, then all available funds of the Issuer will be swept to pay down the Notes. After September 2028 and October 2030, interest will increase an additional 2.00%

and 4.00% per annum, respectively, on any Notes outstanding. The effective interest rate for the Class A and Class B Notes as of December 31, 2024 was 9.07% and 10.98%, respectively.

As the Indenture was entered into in conjunction with the Eleventh Amendment, the Company performed an analysis under ASC 470, Debt, and determined that debt modification accounting was appropriate for the Term Loans and Notes. The additional debt discount costs incurred in connection with the Eleventh Amendment and Indenture include the fair value of the Eleventh Amendment Warrants, fees paid on behalf of lenders, and original issue discount on the Notes. The Company incurred a total of $3.7 million in debt issuance costs and $2.7 million in debt discount related to the Indenture, of which none of the debt issuance costs were capitalized and $2.7 million in debt discount were deferred.

The Company has incurred a total of $51.1 million in debt issuance costs and debt discounts related to the Senior Secured Credit Facility and Notes, of which $35.2 million in debt issuance costs were capitalized and $8.6 million in debt discounts were deferred. The costs associated with the Term Loans and Notes are being amortized using the effective interest method over the term of the respective debt instruments. The costs associated with the Revolving Credit Facility are being amortized on a straight-line basis over the remaining term of the Senior Secured Credit Facility. The amortization of debt issuance costs associated with the Company’s debt is included in interest expense, net in the Company’s condensed consolidated statements of comprehensive income (loss).

The Company uses derivative financial instruments to hedge against its exposure to fluctuations in interest rates associated with the Term Loans. Prior to the swap’s termination on November 5, 2024, the Company was party to an interest rate swap contract in respect of a receive-variable, pay-fixed interest rate swap on the notional amount of $325.0 million of the Company’s total outstanding Term Loans balance with a fixed rate of 6.00% plus 0.931%. The amount reclassified from accumulated other comprehensive income (loss) into interest expense on the condensed consolidated statement of comprehensive income (loss) upon termination was $0.7 million.

Variable Interest Entity

The Issuer was formed on July 24, 2023 as a bankruptcy remote and separate legal entity with its own creditors who will be entitled, prior to and upon the liquidation of the Issuer, to be satisfied out of the Issuer’s assets prior to any assets becoming available to the Company. Accordingly, the assets of the Issuer are not available to pay creditors of the Company or any of its subsidiaries.

The Issuer, as described above, meets the definition of a variable interest entity (“VIE”) for which the Company is the primary beneficiary because it has the power over the significant activities of the VIE in its capacity as the servicer of the Subject Renewal Commissions. As such, the Issuer’s assets, liabilities, and financial results of operations are consolidated in the Company’s condensed consolidated financial statements. As of December 31, 2024, the Issuer’s liabilities included in the condensed consolidated balance sheet primarily consisted of the borrowings under the Indenture of $93.7 million.

7.Warrants to Purchase Shares of Common Stock

Concurrent with the entry into the Eleventh Amendment and Indenture on October 15, 2024, the Company issued an aggregate 5,568,360 Eleventh Amendment Warrants to the term lenders under the Senior Secured Credit Facility. Each Eleventh Amendment Warrant entitles the holder to purchase one share of Common Stock at an exercise price of $3.00 per share, payable in cash or on a cashless basis according to the formula set forth in the Eleventh Amendment Warrant agreements. The exercise price of the Eleventh Amendment Warrants and the number of shares issuable upon exercise are subject to adjustments for stock splits, combinations, stock dividends or similar events. The Eleventh Amendment Warrants vest in four equal tranches upon the earlier of (i) the four consecutive anniversaries of the original issue date and (ii) a repayment milestone failure on the Term Loans. If the Eleventh Amendment Warrants have not vested prior to each tranche’s respective anniversary date, and the outstanding principal amount of Term Loans is less than the dollar thresholds set forth in the respective terms, the Eleventh Amendment Warrants shares shall not vest and are forfeited. The Eleventh Amendment Warrants expire four years after the initial vesting date.

The Company evaluated the Eleventh Amendment Warrants under ASC 815, and concluded that they do not meet the criteria to be classified in stockholders’ equity and should be classified as a derivative liability given the variable settlement amount of the Eleventh Amendment Warrant shares. The freestanding Eleventh Amendment Warrants are reflected as liabilities on the condensed consolidated balance sheet at their estimated fair value. As of December 31, 2024, a warrant liability with a fair value of $16.3 million was reflected within other liabilities in the condensed consolidated balance sheet.

Subsequent changes in the estimated fair value of the Eleventh Amendment Warrants are reflected in other expense in the accompanying condensed consolidated statements of comprehensive income (loss). The change in the estimated fair value of the Eleventh Amendment Warrants resulted in a loss of approximately $7.6 million for the three and six months ended December 31, 2024. As of December 31 2024, there were 5,568,360 Eleventh Amendment Warrants outstanding.

8.Fair Value Measurements

The Company determines the fair value of its financial instruments in accordance with the provisions of ASC 820, Fair Value Measurements (“ASC 820”), which establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy under ASC 820 are described below:

•Level 1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities

•Level 2 - Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability

•Level 3 - Valuation is generated from model-based techniques that use significant assumptions not observable in the market. These unobservable assumptions reflect our own estimates of assumptions that market participants would use in pricing the asset or liability.

The carrying amounts of the Company’s cash, accounts receivable, accounts payable, accrued compensation, and accrued liabilities approximate their fair values due to the short-term nature of these instruments. The following tables present information about the Company’s assets and liabilities that are measured at fair value on a recurring basis as of December 31, 2024 and June 30, 2024 and indicate the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value:

	As of December 31, 2024
(in thousands)	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents
Money market funds	$	315	$	—	$	—	$	315
Liabilities:
Long-term liabilities
Warrant liability	$	—	$	—	$	16,269	$	16,269

	As of June 30, 2024
(in thousands)	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents
Money market funds	$	307	$	—	$	—	$	307
Other current assets
Cash flow hedge	$	—	$	5,027	$	—	$	5,027

Money market funds—Represents short-term, highly liquid investments with maturities of three months or less at the time of purchase. Cash equivalents include a money market account primarily invested in cash and U.S. Government securities. These investments are generally classified as Level 1 fair value measurements, which represent unadjusted quoted market prices in active markets for identical assets or liabilities.

Cash flow hedge—Represents derivative financial instruments that the Company uses to hedge against its exposure to fluctuations in interest rates associated with the Term Loans. Refer to Note 6 to the condensed consolidated financial statements for further details on the Company’s cash flow hedge. The Company classifies its Amended Interest Rate Swap as a Level 2 on the fair value hierarchy as the majority of the inputs used to value it primarily includes other than quoted prices that are observable and it uses standard calculations and models that use readily observable market data as their basis.

Warrant liability—The Company utilizes the Black-Scholes-Merton option pricing model for the liability classified Eleventh Amendment Warrants each reporting period, with changes in fair value recognized in the condensed consolidated statements of comprehensive income (loss). The change in the estimated fair value of the Eleventh Amendment Warrants from the date of issuance, October 15, 2024, to December 31, 2024, resulted in a loss of approximately $7.6 million for the three and six months ended December 31, 2024. The estimated fair value of the liability classified Eleventh Amendment Warrants is determined using Level 3 inputs. Inherent in an option pricing model are estimates and assumptions related to expected share-price volatility, risk-free interest rate, expected dividend yield, and expected life. These estimates and assumptions could vary significantly, which could result in material differences in the fair values assigned to the assets and liabilities. The expected life of the Eleventh Amendment Warrants is assumed to be equivalent to their remaining contractual term based upon the vesting date assumed for each tranche. The Company assumed all four tranches will have vested upon the occurrence of a repayment milestone failure on March 31, 2025. The Company estimates the expected volatility of its common stock based on the Company’s historical volatility. The risk-free interest rate is based on the U.S. Treasury zero-coupon yield curve on the valuation date for a maturity similar to the expected remaining life of the Eleventh Amendment

Warrants. The Company does not plan to pay a dividend during the Eleventh Amendment Warrant term, nor have they historically, thus the dividend rate will remain at zero.

The fair value of the Eleventh Amendment Warrants has been estimated with the following assumptions:

	December 31, 2024
Stock price(1)	$	3.72
Exercise price	$	3.00
Expected volatility	108.46		%
Risk-free interest rate	4.25		%
Expected dividend-yield	—		%
Expected life (years)	4.25
Fair value per warrant	$	2.92

(1) The stock price is based on the closing stock price as of December 31, 2024.

Changes in Level 3 fair value measurements during the period ended December 31, 2024 were as follows:

(in thousands)	Warrant Liability
Balance as of June 30, 2024	$	—
Initial measurement	8,628
Change in fair value	7,642
Balance as of December 31, 2024	$	16,269

9.COMMITMENTS AND CONTINGENCIES

Lease Obligations—Refer to Note 4 to the condensed consolidated financial statements for commitments related to our operating leases.

Legal Contingencies and Obligations—From time to time, the Company is subject to legal proceedings and governmental inquiries in the ordinary course of business. Such matters may include insurance regulatory claims; commercial, tax, employment, or intellectual property disputes; matters relating to competition and sales practices; claims for damages arising out of the use of the Company’s services. The Company may also become subject to lawsuits related to past or future acquisitions, divestitures, or other transactions, including matters related to representations and warranties, indemnities, and assumed or retained liabilities. The Company is not currently aware of any legal proceedings or claims that it believes will have, individually or in the aggregate, a material adverse effect on its business, financial condition, operating results, or cash flows; however, in the event of unexpected developments, it is possible that the ultimate resolution of certain ongoing matters, if unfavorable, could be materially adverse to our business, prospects, financial condition, liquidity, results of operation, cash flows, or capital levels.

Securities Class Actions and Stockholder Derivative Suit

On August 16, 2021, a putative securities class action lawsuit captioned Hartel v. SelectQuote, Inc., et al., Case No. 1:21-cv-06903 (“the Hartel Action”) was filed against the Company and two of its executive officers in the U.S. District Court for the Southern District of New York. The complaint asserts securities fraud claims on behalf of a putative class of plaintiffs who purchased or otherwise acquired shares of the Company’s common stock between February 8, 2021 and May 11, 2021 (the "Hartel Relevant Period"). Specifically, the complaint alleges the defendants violated Sections 10(b) and 20(a) and Rule 10b-5 of the Exchange Act by making materially false and misleading statements and failing to disclose material adverse facts about the Company’s business, operations, and prospects, allegedly causing the Company’s common stock to trade at artificially inflated prices during the Hartel

Relevant Period. The plaintiffs seek unspecified damages and reimbursement of attorneys’ fees and certain other costs.

On October 7, 2021, a putative securities class action lawsuit captioned West Palm Beach Police Pension Fund v. SelectQuote, Inc., et al., Case No. 1:21-cv-08279 (“the WPBPPF Action”), was filed in the U.S. District Court for the Southern District of New York against the Company, two of its executive officers, and six current or former members of the Company’s Board of Directors, along with the underwriters of the Company’s initial public offering of common stock (the "Offering"). The complaint asserts claims for securities law violations on behalf of a putative class of plaintiffs who purchased shares of the Company’s common stock (i) in or traceable to the Offering or (ii) between May 20, 2020 and August 25, 2021 (the "WPB Relevant Period"). Specifically, the complaint alleges the defendants violated Sections 10(b) and 20(a) and Rule 10b-5 of the Exchange Act by making materially false and misleading statements and failing to disclose material adverse facts about the Company’s financial well-being and prospects, allegedly causing the Company’s common stock to trade at artificially inflated prices during the WPB Relevant Period. The complaint also alleges the defendants violated Sections 11, 12(a)(2), and 15 of the Securities Act by making misstatements and omissions of material facts in connection with the Offering, allegedly causing a decline in the value of the Company’s common stock. The plaintiffs seek unspecified damages, rescission, and reimbursement of attorneys’ fees and certain other costs.

On October 15, 2021, a motion to consolidate the Hartel Action and the WPBPPF Action was filed. On September 2, 2022, the court entered an order consolidating the Hartel and WPBPPF Actions under the caption In re SelectQuote, Inc. Securities Litigation, Case No. 1:21-cv-06903 (the “Securities Class Action”) and appointing the West Palm Beach Police Pension Fund and City of Fort Lauderdale Police & Fire Retirement System as lead plaintiffs. On November 19, 2022, plaintiffs filed an amended complaint asserting similar allegations to those alleged in the Hartel and WPBPPF Actions in addition to new allegations regarding certain defendants’ purported violation of Section 20A of the Exchange Act. The amended complaint also added Brookside Equity Partners LLC, one of the Company’s principal stockholders, as a defendant. On January 27, 2023, the Company filed a motion to dismiss the amended complaint on behalf of itself and certain of its current and former officers and directors. Plaintiffs filed an opposition to the motion to dismiss on April 5, 2023, and the Company filed its reply to plaintiffs’ opposition on May 10, 2023. On March 28, 2024, the court granted the Company’s motion to dismiss, with leave to amend. Plaintiffs filed their second amended complaint on May 31, 2024. On July 31, 2024, the Company filed a motion to dismiss the second amended complaint. Plaintiffs filed their opposition to the Company’s motion to dismiss on October 2, 2024, and the Company filed its reply to Plaintiffs’ opposition on November 1, 2024.

On March 25, 2022, a stockholder derivative action captioned Jadlow v. Danker, et al., Case No. 1:22-cv-00391 (“the Jadlow Action”) was filed in the U.S. District Court for the District of Delaware by an alleged stockholder of the Company, purportedly on the Company’s behalf. The lawsuit was brought against certain of the Company’s current and former directors and officers, and against the Company, as nominal defendant. The complaint alleges that certain of the defendants violated Section 14(a) of the Exchange Act by making materially false and misleading statements and failing to disclose material adverse facts about the Company’s business, operations, and prospects. The complaint also asserts claims against all defendants for breach of fiduciary duty, unjust enrichment, abuse of control, gross mismanagement, and waste of corporate assets based on the same general underlying conduct and seeks contribution under Sections 10(b) and 21D of the Exchange Act and Section 11(f) of the Securities Act from the individual defendants named in the Securities Class Actions. The complaint seeks unspecified damages for the Company, restitution, reformation and improvement of its corporate governance and internal procedures regarding compliance with laws, and reimbursement of costs and attorneys’ fees. On July 25, 2022, the Jadlow action was transferred to the U.S. District Court for the Southern District of New York, where it was assigned Case No. 1:22-cv-06290 and referred to Judge Alvin K. Hellerstein as possibly related to the Hartel Action. On August 4, 2022, Judge Hellerstein accepted the Jadlow action as related to the Hartel Action and, on August 10, 2022, granted the parties’ joint stipulation to stay the Jadlow action pending the resolution of the motion to dismiss the Securities Class Action.

The Company currently believes that these matters will not have a material adverse effect on its operations, financial condition or liquidity; however, depending on how the matters progress, they could be costly to defend and

could divert the attention of management and other resources from operations. The Company has not concluded that a loss related to these matters is probable and, therefore, has not accrued a liability related to these matters.

10.SHAREHOLDERS' EQUITY

Common Stock—As of December 31, 2024, the Company has reserved the following authorized, but unissued, shares of common stock:

ESPP	159
Stock awards outstanding under 2020 Plan	19,819,907
Stock awards available for grant under 2020 Plan	3,489,310
Options outstanding under 2003 Plan	471,479
Total	23,780,855

Share-Based Compensation Plans

The Company has awards outstanding from two share-based compensation plans: the 2003 Stock Incentive Plan (the “2003 Stock Plan”) and the 2020 Omnibus Incentive Plan (the “2020 Stock Plan” and, collectively with the 2003 Stock Plan, the “Stock Plans”). However, no further awards will be made under the 2003 Stock Plan. The Company's Board of Directors adopted, and shareholders approved, the 2020 Stock Plan in connection with the Company’s IPO, which provides for the grant of incentive stock options (“ISO's”), nonstatutory stock options (“NSO's”), stock appreciation rights, restricted stock awards, restricted stock unit awards (“RSU's”), performance-based restricted stock units (“PSU's”), price-vested restricted stock units (“PVU’s”) and other forms of equity compensation (collectively, “stock awards”). All stock awards (other than ISOs, which may be granted only to current employees of the Company) may be granted to employees, non-employee directors, and consultants of the Company and its subsidiaries and affiliates.

The number of shares of common stock available for issuance as of December 31, 2024, pursuant to future awards under the Company's 2020 Stock Plan is 3,489,310. The number of shares of the Company's common stock reserved under the 2020 Stock Plan is subject to an annual increase on the first day of each fiscal year beginning on July 1, 2021, equal to 3% of the total outstanding shares of common stock as of the last day of the immediately preceding fiscal year. The maximum number of shares of common stock that may be issued upon the exercise of ISO's will be 4,000,000. The shares of common stock covered by any award that is forfeited, terminated, expired, or lapsed without being exercised or settled for cash will again become available for issuance under the 2020 Stock Plan. With respect to any award, if the exercise price and/or tax withholding obligations are satisfied by delivering shares to the Company (by actual delivery or attestation), or if the exercise price and/or tax withholding obligations are satisfied by withholding shares otherwise issuable pursuant to the award, the share reserve shall nonetheless be reduced by the gross number of shares subject to the award.

The Company accounts for its share-based compensation awards in accordance with ASC 718, Compensation—Stock Compensation (“ASC 718”) which requires all share-based compensation to be recognized in the income statement based on fair value and applies to all awards granted, modified, canceled, or repurchased after the effective date.

Total share-based compensation for stock awards included in selling, general and administrative expense in the condensed consolidated statements of comprehensive income (loss) was as follows for the periods presented:

	Three Months Ended December 31,				Six Months Ended December 31,
(in thousands)	2024		2023		2024		2023
Share-based compensation related to:
Equity classified stock options	$	374	$	714	$	850	$	1,436
Equity classified RSU's	2,641		2,116		4,934		3,857
Equity classified PSU's	—		—		—		33
Equity classified PVU's	1,684		992		2,761		1,671
Total	$	4,699	$	3,822	$	8,545	$	6,997

Stock Options—The stock options outstanding under the 2003 Stock Plan vest as to one-third after the vesting commencement date and as to 1/24 of the remaining shares subject to the stock option monthly thereafter, subject to the award recipient’s continued employment through the applicable vesting date. Upon a termination of employment for any reason other than for “Cause” (as defined in the 2003 Stock Plan), any unvested and outstanding stock options would generally be forfeited for no consideration, and any vested and outstanding stock options would remain exercisable for 90 days following the date of termination (and, in the case of a termination of employment due to death or disability, for 12 months following the date of termination). Stock options expire 10 years from the date of grant. The terms for ISO's and NSO's awarded in the 2020 Stock Plan are the same as in the 2003 Stock Plan with the exception that the options generally shall vest and become exercisable in four equal installments on each of the first four anniversaries of the grant date, subject to the award recipient’s continued employment through the applicable vesting date. Stock options are granted with an exercise price that is no less than 100% of the fair market value of the underlying shares on the date of the grant.

The fair value of each option (for purposes of calculation of share-based compensation expense) is estimated using the Black-Scholes-Merton option pricing model that uses assumptions determined as of the date of the grant. Use of this option pricing model requires the input of subjective assumptions. These assumptions include estimating the length of time employees will retain their vested stock options before exercising them (“expected term”), the estimated volatility of the Company's common stock price over the expected term (“volatility”), the number of options that will ultimately not complete their vesting requirements (“assumed forfeitures”), the risk-free interest rate that reflects the interest rate at grant date on zero-coupon United States governmental bonds that have a remaining life similar to the expected term (“risk-free interest rate”), and the dividend yield assumption which is based on the Company's dividend payment history and management's expectations of future dividend payments (“dividend yield”). Changes in the subjective assumptions can materially affect the estimate of the fair value of share-based compensation and, consequently, the related amount recognized in the condensed consolidated statements of comprehensive income (loss).

During the six months ended December 31, 2024 and 2023, there were no stock options granted. The following table summarizes stock option activity under the Stock Plans for the six months ended December 31, 2024:

	Number of Options	Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Term (in Years)	Aggregate Intrinsic Value (in Thousands)
Outstanding—June 30, 2024	3,677,964	$	11.81
Options granted	—	—
Options exercised	(95,316)	2.05
Options forfeited/expired/cancelled	(130,818)	7.05
Outstanding—December 31, 2024	3,451,830	$	12.26	5.92	$	1,917
Vested and exercisable—December 31, 2024	2,766,270	$	13.35	5.66	$	1,394

As of December 31, 2024, there was $1.1 million in unrecognized share-based compensation cost related to unvested stock options granted, which is expected to be recognized over a weighted-average period of 0.75 years.

The Company did not receive any cash in connection with stock options exercised during the three months ended December 31, 2024, and less than $0.1 million in connection with stock options exercised during the six months ended December 31, 2024. During the six months ended December 31, 2023, there were no stock options exercised.

Restricted Stock—The Company grants RSU's to eligible employees, non-employee directors, and contractors. These awards generally vest over a period of one to four years. Fair value of the RSU's is determined based on the market price of the Company’s common stock at the grant date and share-based compensation expense is recognized over the requisite service period.

The following table summarizes restricted stock unit activity under the 2020 Stock Plan for the six months ended December 31, 2024:

	Number of Restricted Stock Units	Weighted-Average Grant Date Fair Value
Unvested as of June 30, 2024	8,441,168	$	1.91
Granted	4,004,124	2.99
Vested	(3,509,924)	2.07
Forfeited	(247,060)	2.68
Unvested as of December 31, 2024	8,688,308	$	2.31

As of December 31, 2024, there was $16.0 million of unrecognized share-based compensation cost related to unvested restricted stock units granted, which is expected to be recognized over a weighted-average period of 2.00 years.

Performance Stock—Based upon the terms of the PSU’s granted, if certain performance metrics are met, PSU’s vest at the end of a three-year performance period. The fiscal year 2021 tranche vested on September 13, 2023, at 13% of the target and 14,477 shares were issued. The fiscal year 2022 tranche did not reach the target as of June 30, 2024, and no shares vested thus all PSU’s were forfeited back to the 2020 Stock Plan. As of December 31, 2024, there were no remaining PSU’s granted thus there was no unrecognized compensation cost related to unvested performance stock units granted.

Price-Vested Units—During the six months ended December 31, 2024, the Company issued PVU’s for which vesting is subject to the fulfillment of both a service period and the achievement of stock price hurdles during the relevant performance period. For the awards granted during the six months ended December 31, 2024 and 2023, they are divided into three and four separate tranches, each with a different price hurdle which is measured as the average trading price over 60 calendar days on a rolling daily basis, over a performance period of five years. An employee is eligible to vest in one-third of the awards in each tranche after each year of service, but subject to the achievement of the stock-price hurdle attached to each tranche. As a result, share-based compensation will be recognized on a straight-line basis across nine or twelve tranches over each tranche’s requisite service period, which is the greater of the derived service period and the explicit service period.

The following table summarizes the number of shares, stock price hurdles, service periods, and performance periods for each tranche, for the PVU’s granted during the six months ended December 31, 2024:

	Number of Shares per Tranche	Grant Date Fair Value (per Share)		Stock Price Hurdle (per Share)		Performance Period	Requisite Service Period
Tranche 1	772,027	$	3.98	$	3.13	August 1, 2024 - August 1, 2029	1 year - 3 years
Tranche 2	772,020	$	3.75	$	6.00	August 1, 2024 - August 1, 2029	1 year - 3 years
Tranche 3	772,027	$	3.49	$	9.00	August 1, 2024 - August 1, 2029	1.31 years - 3 years

The following table summarizes the number of shares, stock price hurdles, service periods, and performance periods for each tranche, for the PVU’s awarded during the six months ended December 31, 2023:

	Number of Shares per Tranche	Grant Date Fair Value (per Share)		Stock Price Hurdle (per Share)		Performance Period	Requisite Service Period
Tranche 1	558,569	$	1.85	$	2.50	August 1, 2023 - August 1, 2028	1 year - 3 years
Tranche 2	558,540	$	1.69	$	5.00	August 1, 2023 - August 1, 2028	1.41 years - 3 years
Tranche 3	558,579	$	1.55	$	7.50	August 1, 2023 - August 1, 2028	1.96 years - 3 years
Tranche 4	558,550	$	1.45	$	10.00	August 1, 2023 - August 1, 2028	2.27 years - 3 years

The fair value of each PVU (for purposes of calculation of share-based compensation expense) is estimated using a Monte Carlo simulation valuation model that uses assumptions determined as of the date of the grant. Use of this model requires the input of subjective assumptions and changes in the subjective assumptions can materially affect the estimate of the fair value of share-based compensation recognized in the condensed consolidated statements of comprehensive income (loss). These assumptions include estimating the volatility of the Company's common stock price over the expected term, the risk-free interest rate that reflects the interest rate at grant date on zero-coupon United States governmental bonds that have a remaining life similar to the expected term risk-free interest rate, the cost of equity, and the dividend yield assumption which is based on the Company's dividend payment history and management's expectations of future dividend payments.

The Company used the following weighted-average assumptions for the PVU’s granted during the period presented below:

	Six Months Ended December 31,
	2024	2023
Share price as of grant date	$4.01	$1.38
Volatility	88.8%	94.3%
Risk-free interest rate	3.8%	4.1%
Cost of Equity	12.6%	9.2%
Dividend yield	—%	—%

The following table summarizes price-vested stock unit activity under the 2020 Stock Plan for the six months ended December 31, 2024:

	Number of Price-Vested Units	Weighted-Average Grant Date Fair Value
Unvested as of June 30, 2024	6,170,385	$	1.37
Granted	2,316,074	3.74
Vested	(182,291)	1.69
Forfeited	(152,920)	2.10
Unvested as of December 31, 2024	8,151,248	$	2.04

During the six months ended December 31, 2024, the $2.50 stock price hurdle was achieved. As a result, one-third of the awards in the first tranche of PVU’s granted during the three months ended September 30, 2023 vested.

As of December 31, 2024, there was $8.9 million of unrecognized share-based compensation cost related to unvested PVU’s granted, which is expected to be recognized over a weighted-average period of 1.55 years.

ESPP—The purpose of the Company’s employee stock purchase plan (“ESPP”) is to provide the Company's eligible employees with an opportunity to purchase shares on the exercise date at a price equal to of the fair market value of the Company’s common stock as of either the exercise date or the first day of the relevant offering period, whichever is lesser. The ESPP was suspended effective April 1, 2023, and as of December 31, 2024 there are 159 shares reserved for future issuance under the plan.

11.REVENUES FROM CONTRACTS WITH CUSTOMERS

Disaggregation of Revenue from Contracts with Customers—The disaggregation of revenue by segment and product is depicted for the periods presented below, and is consistent with how the Company evaluates its financial performance:

	Three Months Ended December 31,				Six Months Ended December 31,
(dollars in thousands)	2024		2023		2024		2023
Senior:
Medicare advantage commissions	$	226,716	$	217,969	$	301,187	$	292,340
Other Senior commissions	2,185		3,048		4,765		4,840
Other services	26,677		26,512		42,535		40,265
Total Senior revenue	255,578		247,529		348,487		337,445
Healthcare Services:
Pharmacy	180,000		108,795		332,883		203,583
Other services	3,370		2,915		6,225		5,495
Total Healthcare Services revenue	183,370		111,710		339,108		209,078
Life:
Term commissions	18,666		18,113		35,030		37,227
Final expense commissions	16,283		14,482		34,607		28,602
Other services	4,912		4,772		9,514		9,341
Total Life revenue	39,861		37,367		79,151		75,170
All other:
Commissions	3,972		10,275		9,767		19,090
Other services	171		212		343		425
Total All other revenue	4,143		10,487		10,110		19,515
Eliminations:
Commissions	(1,022)		(662)		(1,665)		(1,118)
Other services	(861)		(993)		(1,859)		(1,923)
Total Elimination revenue	(1,883)		(1,655)		(3,524)		(3,041)
Total Commissions and other services revenue	301,069		296,643		440,449		434,584
Total Pharmacy revenue	180,000		108,795		332,883		203,583
Total Revenue	$	481,069	$	405,438	$	773,332	$	638,167

Contract Balances—The Company has contract assets related to commissions receivable from its insurance carrier partners, with the movement over time as the policy is renewed between long-term and short-term commissions receivable and accounts receivable, net being the main activity, along with commission revenue adjustments from changes in estimates.

A roll forward of commissions receivable (current and long-term) is shown below for the period presented:

(in thousands)
Balance as of June 30, 2024	$	881,317
Commission revenue from revenue recognized	178,207
Net commission revenue adjustment from change in estimate	2,944
Amounts recognized as accounts receivable, net	(25,644)
Balance as of December 31, 2024	$	1,036,824

For the six months ended December 31, 2024, the $2.9 million net commission revenue adjustment from change in estimate includes adjustments related to revenue recognized in prior fiscal years, based on the Company’s reassessment of each of its cohorts’ transaction prices. It includes a positive adjustment of $0.8 million for Senior and a positive adjustment of $0.4 million for Life. The remaining $1.8 million relates to the Company’s All other non-reportable segment. Refer to Note 14 to the condensed consolidated financial statements for further details on the Company’s reportable segments.

The Company’s contract liabilities on the condensed consolidated balance sheets represent unamortized upfront payments received as of December 31, 2024, for commission revenue for which the performance obligations have not yet been met and are anticipated to be recognized over the next twelve months.

A roll forward of contract liabilities (current and long-term) is shown below for the period presented:

(in thousands)
Balance as of June 30, 2024	$	8,066
Commission and other services revenue recognized	(29,509)
Amounts recognized as contract liabilities	22,397
Balance as of December 31, 2024	$	954

12.INCOME TAXES

For the three months ended December 31, 2024 and 2023, the Company recognized income tax benefits and expense of $13.7 million and $11.5 million, respectively, representing effective tax rates of (34.6)% and 37.2%, respectively. The differences from the federal statutory tax rate to the effective tax rates for the three months ended December 31, 2024, were primarily related to state income taxes, the recording of a valuation allowance for federal and state tax attributes that the Company does not expect to utilize prior to expiration, vesting of restricted stock units, and non-deductibility of warrant market adjustments . The differences from the federal statutory tax rate to the effective tax rates for the three months ended December 31, 2023, were primarily related to state income taxes and the recording of a valuation allowance for federal tax attributes that the Company does not expect to utilize prior to expiration.

For the six months ended December 31, 2024 and 2023, the Company recognized income tax benefits of $4.2 million and $1.3 million, respectively, representing effective tax rates of (91.6)% and 10.1%, respectively. The differences from the federal statutory tax rate to the effective tax rate for the six months ended December 31, 2024, were primarily related to state income taxes, the recording of a valuation allowance for federal and state tax attributes that the Company does not expect to utilize prior to expiration, vesting of restricted stock units, and non-deductibility of warrant market adjustments. The differences from the federal statutory tax rate to the effective tax rate for the six months ended December 31, 2023, were primarily related to state income taxes and the recording of a valuation allowance for federal tax attributes that the Company does not expect to utilize prior to expiration.

As of December 31, 2024 and 2023, the Company has a valuation allowance of $18.7 million and $9.1 million, respectively, for deferred tax assets related to certain state specific net operating losses, federal and state Sec. 163(j) carryforwards, and credits, as it is more likely than not that those assets will not be realized. As the Company is currently in a three-year cumulative loss position, it cannot consider the projections of future income as

part of the valuation allowance analysis and have considered the other sources of future taxable income described under ASC 740, Income Taxes when evaluating the need for a valuation allowance. Aside from the certain deferred tax asset related to federal and state credits and other attributes noted above where a valuation allowance has been established, the Company continues to recognize its deferred tax assets as of December 31, 2024 as it believes it is more likely than not that the remaining net deferred tax assets will be realized. The Company will continue to evaluate the realizability of its deferred tax assets.

13.NET INCOME (LOSS) PER SHARE

The Company calculates net income (loss) per share as defined by ASC 260, Earnings per Share. Basic net income (loss) per share (“Basic EPS”) is computed by dividing net income (loss) attributable to common shareholders by the weighted-average common stock outstanding during the respective period. Diluted net income (loss) per share (“Diluted EPS”) is computed by dividing net income (loss) attributable to common and common equivalent shareholders by the total of the weighted-average common stock outstanding and common equivalent shares outstanding during the respective period. For the purpose of calculating the Company’s Diluted EPS, common equivalent shares outstanding include common shares issuable upon the exercise of outstanding employee stock options, unvested RSU's, PSU’s assuming the performance conditions are satisfied as of the end of the reporting period, PVU’s assuming market conditions are satisfied as of the end of the reporting period, common shares issuable upon the conclusion of each ESPP offering period, and Eleventh Amendment Warrants. The number of common equivalent shares outstanding has been determined in accordance with the treasury stock method for employee stock options, RSU's, PSU’s, PVU’s, common stock issuable pursuant to the ESPP, and Eleventh Amendment Warrants to the extent they are dilutive. Under the treasury stock method, the exercise price paid by the option holder and future share-based compensation expense that the Company has not yet recognized are assumed to be used to repurchase shares.

The following table sets forth the computation of net income (loss) per share for the periods presented:

	Three Months Ended December 31,				Six Months Ended December 31,
(in thousands, except per share amounts)	2024		2023		2024		2023
Basic:
Numerator:
Net income (loss) attributable to common shareholders	$	53,236	$	19,392	$	8,690	$	(11,659)
Denominator:
Weighted-average common stock outstanding	171,802		168,349		171,116		167,901
Net income (loss) per share—basic:	$	0.31	$	0.12	$	0.05	$	(0.07)
Diluted:
Numerator:
Net income (loss) attributable to common and common equivalent shareholders	$	53,236	$	19,392	$	8,690	$	(11,659)
Denominator:
Weighted-average common stock outstanding	171,802		168,349		171,116		167,901
Stock options outstanding to purchase shares of common stock including unvested RSU's and from the ESPP(1)	3,299		1,388		3,908		—
Total common and common equivalent shares outstanding	175,101		169,737		175,024		167,901
Net income (loss) per share—diluted:	$	0.30	$	0.11	$	0.05	$	(0.07)

(1) Excluded from the computation of net income (loss) per share-diluted for the six months ended December 31, 2023 because the effect would have been anti-dilutive.

The weighted average potential shares of common stock that were excluded from the calculation of net income (loss) per share-diluted for the periods presented because including them would have been anti-dilutive consisted of the following:

	Three Months Ended December 31,		Six Months Ended December 31,
(in thousands)	2024	2023	2024	2023
Stock options outstanding to purchase shares of common stock including unvested RSU's and from the ESPP	4,875	8,428	4,164	11,855

The weighted average potential shares of common stock that were excluded from the calculation of net income (loss) per share-diluted because the performance or market conditions associated with these awards were not met are as follows for the periods presented:

	Three Months Ended December 31,		Six Months Ended December 31,
(in thousands)	2024	2023	2024	2023
Shares subject to outstanding PVU’s	8,151	6,281	7,393	6,280

The weighted average potential shares of common stock that were excluded from the calculation of net income (loss) per share-diluted because the exercise price of the Eleventh Amendment Warrants exceeded the average market price of the Company's common stock for the periods presented:

	Three Months Ended December 31,		Six Months Ended December 31,
(in thousands)	2024	2023	2024	2023
Warrants to purchase common stock	5,568	—	5,568	—

14.SEGMENT INFORMATION

As of July 1, 2024, the Company has realigned its reportable segments for fiscal year 2025. The Auto & Home business does not meet the quantitative thresholds to be required to continue to be separately disclosed as a reportable segment in accordance with ASC 280, Segment Reporting (“ASC 280”). As a result, the Auto & Home business will be included in an “All Other” category. Prior period information has been recast to conform to the current presentation.

The Company’s operating segments have been determined in accordance with ASC 280. We currently have three reportable segments: i) Senior, ii) Healthcare Services, and iii) Life. Senior primarily sells senior Medicare-related health insurance products. Healthcare Services includes SelectRx, Population Health, and SelectPatient Management. Healthcare Services provides products and services to our Medicare policyholders, which are focused on improving patient health outcomes. Life primarily sells term life and final expense products. The All Other category is reflective of the revenue generated from selling individual automobile and homeowners’ insurance. Additionally, the Company accounts for non-operating activity, share-based compensation expense, depreciation and amortization, goodwill, long-lived asset and intangible asset impairments, certain intersegment eliminations, and the costs of providing corporate and other administrative services in our administrative division, Corporate & Eliminations. These services are not directly identifiable with our reportable segments and are shown in the tables below to reconcile the reportable segments to the consolidated financial statements. We have not aggregated any operating segments together to represent a reportable segment.

Our operating segments are determined based on how our chief executive officer, who also serves as our CODM manages our business, regularly accesses information, and evaluates performance for operating decision-making purposes, including allocation of resources. Adjusted EBITDA is our segment profit measure and a key

measure used by our CODM and Board of Directors to understand and evaluate the operating performance of our business and on which internal budgets and forecasts are based and approved. We define Adjusted EBITDA as income (loss) before income tax expense (benefit) plus: (i) interest expense, net; (ii) depreciation and amortization; (iii) share-based compensation; (iv) goodwill, long-lived asset, and intangible assets impairments; (v) transaction costs; (vi) loss on disposal of property, equipment and software, net; (vii) other non-recurring expenses and income; and (viii) changes in fair value of warrant liabilities.

The following tables present information about the reportable segments for the periods presented. We do not report total assets by segment as our CODM does not use this information to evaluate operating segment performance. Accordingly, we do not regularly provide such information by segment to our CODM.

Our segment disclosure includes intersegment revenues, which consist of affiliate marketing fees for services provided by our Senior segment to our Healthcare Services and Life segments as well as services provided by Life to other segments. These intersegment transactions are recorded by each segment at amounts that we believe approximate fair value as if the transactions were between third parties and, therefore, impact segment performance. However, the revenue and corresponding expense are eliminated in consolidation. The elimination of such intersegment transactions is included within the “Eliminations of intersegment revenues” and “Corporate & elimination of intersegment profits’ captions in the tables below.

The following table presents information about the reportable segments for the three months ended December 31, 2024:

(in thousands)	Senior		Healthcare Services		Life		Total
External revenue	$	253,805	$	183,281	$	39,840	$	476,926
Intersegment revenue	1,773		89		21		1,883
Total revenue from reportable segments	$	255,578	$	183,370	$	39,861	$	478,809
All other revenue							4,143
Eliminations of intersegment revenues							(1,883)
Total consolidated revenue							$	481,069

(in thousands)	Senior		Healthcare Services		Life		Total
Adjusted Segment EBITDA	$	100,521	$	2,212	$	7,423	$	110,156
All other Adjusted EBITDA							2,303
Corporate & elimination of intersegment profits							(24,940)
Share-based compensation expense							(4,699)
Transaction costs (1)							(6,719)
Depreciation and amortization							(5,060)
Loss on disposal of property, equipment, and software, net							(122)
Change in fair value of warrant liabilities							(7,642)
Interest expense, net							(23,721)
Income before income tax expense (benefit)							$	39,556

(1) These expenses primarily consist of financing transaction costs ($6.7 million).

The following table presents information about the reportable segments for the three months ended December 31, 2023:

(in thousands)	Senior		Healthcare Services		Life		Total
External revenue	$	245,897	$	111,710	$	37,344	$	394,951
Intersegment revenue	1,632		—		23		1,655
Total revenue from reportable segments	$	247,529	$	111,710	$	37,367	$	396,606
All other revenue							10,487
Eliminations of intersegment revenues							(1,655)
Total consolidated revenue							$	405,438

(in thousands)	Senior		Healthcare Services		Life		Total
Adjusted Segment EBITDA	$	78,713	$	2,981	$	4,569	$	86,263
All other Adjusted EBITDA							4,725
Corporate & elimination of intersegment profits							(23,574)
Share-based compensation expense							(3,822)
Transaction costs (1)							(2,400)
Depreciation and amortization							(5,898)
Interest expense, net							(24,415)
Income before income tax expense (benefit)							$	30,879

(1) These expenses primarily consist of financing transaction costs.

The following table presents information about the reportable segments for the six months ended December 31, 2024:

(in thousands)	Senior		Healthcare Services		Life		Total
External revenue	$	345,169	$	338,947	$	79,106	$	763,222
Intersegment revenue	3,318		161		45		3,524
Total revenue from reportable segments	$	348,487	$	339,108	$	79,151	$	766,746
All other revenue							10,110
Eliminations of intersegment revenues							(3,524)
Total consolidated revenue							$	773,332

(in thousands)	Senior		Healthcare Services		Life		Total
Adjusted Segment EBITDA	$	108,247	$	7,089	$	13,383	$	128,719
All other Adjusted EBITDA							6,099
Corporate & elimination of intersegment profits							(48,983)
Share-based compensation expense							(8,545)
Transaction costs (1)							(7,544)
Depreciation and amortization							(10,659)
Loss on disposal of property, equipment, and software, net							(157)
Change in fair value of warrant liabilities							(7,642)
Interest expense, net							(46,752)
Income before income tax expense (benefit)							$	4,536

(1) These expenses primarily consist of non-restructuring severance expenses ($0.5 million) and financing transaction costs ($7.0 million).

The following table presents information about the reportable segments for the six months ended December 31, 2023:

(in thousands)	Senior		Healthcare Services		Life		Total
External revenue	$	334,458	$	209,078	$	75,116	$	618,652
Intersegment revenue	2,987		—		54		3,041
Total revenue from reportable segments	$	337,445	$	209,078	$	75,170	$	621,693
All other revenue							19,515
Eliminations of intersegment revenues							(3,041)
Total consolidated revenue							$	638,167

(in thousands)	Senior		Healthcare Services		Life		Total
Adjusted Segment EBITDA	$	77,376	$	5,304	$	9,808	$	92,488
All other Adjusted EBITDA							8,045
Corporate & elimination of intersegment profits							(44,495)
Share-based compensation expense							(6,997)
Transaction costs (1)							(4,305)
Depreciation and amortization							(11,887)
Loss on disposal of property, equipment, and software, net							(9)
Interest expense, net							(45,811)
Loss before income tax expense (benefit)							$	(12,971)

(1) These expenses primarily consist of financing transaction costs.

Revenues from each of the reportable segments are earned from transactions in the United States and follow the same accounting policies used for the Company’s condensed consolidated financial statements. All of the Company’s long-lived assets are located in the United States. For the three months ended December 31, 2024, three insurance carrier customers accounted for 38% (UHC), 14% (Humana), and 16% (Aetna) of total revenue. For the three months ended December 31, 2023, three customers accounted for 32% (UHC), 19% (Humana), and 16% (Aetna) of total revenue. For the six months ended December 31, 2024, three customers accounted for 35% (UHC), 13% (Humana), and 17% (Aetna) of total revenue. For the six months ended December 31, 2023, three customers accounted for 32% (UHC), 18% (Humana) and 12% (Aetna) of total revenue, respectively. For all periods presented, the revenue was provided by both the Senior and Healthcare Services segments. For all periods presented, the revenue was provided by both the Senior and Healthcare Services segments.

15.     SUBSEQUENT EVENTS

Management has evaluated subsequent events pursuant to the requirements of ASC 855, Subsequent Events, from the balance sheet date through the date the financial statements were issued and has determined that there are the following material subsequent events.

Senior Preferred Stock Purchase Agreements

On February 10, 2025, the Company entered into a Senior Preferred Stock Purchase Agreement (the “Morgan Stanley Purchase Agreement”), with NL Monarch Holdings LLC (“Morgan Stanley”) and a Senior Preferred Stock Purchase Agreement (the “Bain Purchase Agreement” and together with the Morgan Stanley Purchase Agreement, the “Senior Preferred Stock Purchase Agreements”) with NL Monarch Holdings II LLC (“Bain,” and together with Morgan Stanley, the “Purchasers” or the “Lead Investors,” and each, a “Purchaser”), providing for an aggregate investment by the Purchasers of $350.0 million in cash in the Company (collectively, the “Investment”).

The Company has agreed to issue and sell an aggregate of 350,000 shares of Senior Non-Convertible Preferred Stock of the Company, par value $0.01 per share, (the “Preferred Stock”), with a face value per share of $1,000 (“Original Liquidation Preference”), and 30,833,333 warrants to purchase shares of the Company’s common stock, par value $0.01 (the “Common Stock”). Each of (1) Morgan Stanley, for an aggregate investment by Morgan Stanley of $175.0 million, pursuant to the Morgan Stanley Purchase Agreement, and (2) Bain, for an aggregate investment by Bain of $175.0 million pursuant to the Bain Purchase Agreement, will purchase: (a) 175,000 shares of

Preferred Stock; (b) warrants to purchase 6,740,740.5 shares of Common Stock at an initial exercise price of $0.01 per share (the “Tranche A Warrants”); (c) warrants to purchase 5,055,555.5 shares of Common Stock at initial exercise price equal to the thirty (30)-day volume weighted average of the closing sales price of the Common Stock, determined on the date which is forty-five (45) days following February 10, 2025 (provided, that if such volume weighted average is (i) less than $2.15, the exercise price will be $2.15, and (ii) greater than $4.00, the exercise price will be $4.00) (the “Tranche B Warrants”); and (d) warrants to purchase 3,620,370.5 shares of Common Stock at an initial exercise price $5.50 per share (the “Tranche C Warrants,” and together with the Tranche A Warrants and the Tranche B Warrants, the “Preferred Warrants”), in the case each series of Preferred Warrants, subject to customary anti-dilution adjustments. Dividends on each share of Preferred Stock will accrue daily at an initial rate of 14.5% per annum, subject to certain adjustments, and will be payable quarterly.

The Company will issue 85% of the aggregate Preferred Warrants that are allocated to each Purchaser at funding. On January 2, 2026, the Company will issue the balance of the aggregate Preferred Warrants that are allocated to each Purchaser, provided that if on or prior to December 31, 2025 the Company has redeemed any of the shares of Preferred Stock (the aggregate Original Liquidation Preference (as defined in the Certificate of Designation) of the shares of Preferred Stock redeemed by the Company, the “Early Redemption Amount”), then the aggregate number of additional Tranche A Warrants, Tranche B Warrants and Tranche C Warrants to be issued to the Purchasers on January 2, 2026 will be reduced pro rata by a percentage equal to the Early Redemption Amount divided by $50.0 million. If the Early Redemption Amount equals $50.0 million, then no additional Tranche A Warrants, Tranche B Warrants or Tranche C Warrants will be issued to either of the Purchasers.

Upon consummation of the transactions described above, the Company will reimburse certain of the Purchasers’ expenses and pay to the Purchasers an aggregate closing fee of 3.0% of the aggregate purchase price of the Preferred Stock and Preferred Warrants.

The issuance of the Preferred Stock and Preferred Warrants pursuant to the Senior Preferred Stock Purchase Agreements will occur on February 28, 2025. The Senior Preferred Stock Purchase Agreements contain representations, warranties, indemnification and other provisions customary for transactions of this nature, including certain standstill provisions.

Senior Secured Credit Facility

On February 10, 2025, the Company also entered into a Twelfth Amendment (the “Twelfth Amendment”) to the Senior Secured Credit Facility. The Twelfth Amendment permits certain amendments to the Senior Secured Credit Facility to, among other things (1) permit certain modifications to the asset coverage and minimum liquidity covenants and (2) permit certain other modifications (including changing the cash and PIK interest applicable to the outstanding term loans as set forth below) as a result of the partial prepayment of term loans that will be made with the net proceeds received by the Company from the sale of Preferred Stock described below.

Following the effectiveness of the Twelfth Amendment and until January 1, 2027 the term loans under the amended agreement will accrue cash and PIK interest (A) at a rate per annum equal to either (a) SOFR (subject to a floor of 3.00%) plus 6.50% or (b) a base rate plus 5.50% and (B) at a rate per annum equal 0%-3% for PIK interest, depending on the Company’s asset coverage ratio as of the date of calculation. The interest rate may decrease prior to January 1, 2027 as set forth in the Twelfth Amendment if the Company achieves certain repayment milestones set forth in the amended agreement. The term loans outstanding after January 1, 2027 will accrue cash and PIK interest (A) at a rate per annum equal to either (a) SOFR (subject to a floor of 3.00%) plus 6.50% or (b) a base rate plus 5.50% and (B) at a rate per annum equal 3% for PIK interest.

The amendments set forth in the Twelfth Amendment will be effective concurrently with the Company’s receipt of the proceeds from the issuance of the Preferred Stock and the Preferred Warrants pursuant to the Senior Preferred Stock Purchase Agreements on February 28, 2025.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

You should read the following discussion and analysis of our financial condition and result of operations together with our condensed consolidated financial statements and footnotes included elsewhere in this Quarterly Report on Form 10-Q. In addition to historical information, this discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions. The forward-looking statements are not historical facts, but rather are based on current expectations, estimates, assumptions and projections about our industry, business and future financial results. Please refer to a discussion of the Company’s forward-looking statements and associated risks in “Cautionary Note Regarding Forward-Looking Statements” in our Annual Report. Our actual results may differ materially from those discussed below. Factors that could cause or contribute to such differences include, but are not limited to, those discussed in the section titled “Risk Factors” in our Annual Report and in Part II, Item 1A hereof.

Company Overview

SelectQuote, Inc. (together with its subsidiaries, “SelectQuote”, the “Company”, “we”, “us”) is a leading technology-enabled, direct-to-consumer (“DTC”) distribution and engagement platform for selling insurance policies and healthcare services. Our insurance distribution business, which has operated continuously for nearly 40 years, allows consumers to transparently and conveniently shop for senior health, life, and automobile and home insurance policies from a curated panel of the nation’s leading insurance carriers. As an insurance distributor, we do not insure the consumer, but rather identify consumers looking to acquire insurance products and place these consumers with insurance carrier partners that provide these products. In return, we earn commissions from our insurance carrier partners for the policies we sell on their behalf. Our proprietary technology allows us to take a broad funnel approach to marketing by analyzing and identifying high-quality consumer leads sourced from a wide variety of online and offline marketing channels including digital marketing, radio, television, and third-party marketing partners. We monitor our acquisition costs to dynamically allocate our marketing spend to the most attractive channels, benefiting from nearly 40 years of data accumulated through our proprietary, purpose-built technologies. Our advanced workflow processing system scores each acquired lead in real time, matching it with a sales agent whom we determine is best suited to meet the consumer’s need. Our platform then captures and utilizes our experience to further build upon the millions of data points that feed our marketing algorithms, further enhancing our ability to deploy subsequent marketing dollars efficiently and target more high-quality consumer leads. We have built our business model to maximize commissions collected over the life of an approved policy, a metric we refer to as “ lifetime value of commissions” or “LTV”, which is a key component to our overall profitability.

Our proprietary routing and workflow system is a key competitive advantage and driver of our business performance. Our systems analyze and intelligently route consumer leads to agents and allow us to monitor, segment, and enhance our agents’ performance. This technological advantage also allows us to rapidly conduct a needs-based, tailored analysis for each consumer that maximizes sales, enhances customer retention, and ultimately maximizes LTV’s. Our expertise and value add stems from the coupling of our technology with our skilled agents, which provides greater transparency in pricing terms and choice and an overall better consumer experience. When customers are satisfied, their propensity to switch policies decreases, thereby improving retention rates (“persistency”), increasing LTV’s and, ultimately, optimizing our financial performance and shareholder value.

SelectQuote has a long history of successful DTC product distribution and consumer engagement, and we bring this same capability to healthcare services. We saw a large opportunity to leverage our existing customer base and distribution model to improve education and access to healthcare services for our senior consumers and to create value for our shareholders and insurance carrier partners. SelectQuote’s value lies in our ability to engage the consumer, capture critical self-reported information in real-time, and then take action on that information to offer each consumer personalized solutions. Our healthcare services business seeks to provide consumers with a wide breadth of products supporting their needs, such as SelectRx, our Patient-Centered Pharmacy HomeTM (“PCPH”) accredited pharmacy, which has already demonstrated SelectQuote’s ability to leverage our strong consumer engagement to drive immediate value using our existing operational infrastructure. Whether through acquisitions or

new partnerships, we continue to look for more opportunities to leverage our strengths to expand our healthcare services business.

We evaluate our business using the following three reportable segments:

Senior was launched in 2010 and provides unbiased comparison shopping for Medicare Advantage (“MA”) and Medicare Supplement (“MS”) insurance plans as well as prescription drug and dental, vision, and hearing (“DVH”) plans, and critical illness products. We represent approximately 25 leading, nationally-recognized insurance carrier partners, including UHC, Humana, Aetna, and Wellcare. MA and MS plans accounted for 93% and 92% of our approved Senior policies for the three months ended December 31, 2024 and 2023, respectively, and 91% and 91% for the six months ended December 31, 2024, and 2023, respectively, with other ancillary type policies accounting for the remainder.

Healthcare Services, launched in 2021, offers various health-related products and services through SelectRx, Population Health, and most recently, SelectPatient Management. SelectRx offers essential prescription medications, OTC medications, customized medication packaging, and medication therapy management, providing long-term pharmacy care that enables patients to optimize medication adherence to drive positive health outcomes, while enabling patients managing polypharmacy and multiple chronic conditions to remain at home. Through Population Health, we utilize our excellent consumer engagement capabilities to capture valuable self-reported information in real-time for our insurance carrier partners by completing Health Risk Assessments (“HRAs”). We then use that data to take a real-time, proactive, and personalized approach to offer various health-related products and services to the consumer, such as our pharmacy services from SelectRx. In 2024, we launched SelectPatient Management (“SPM”), via a $4.0 million acquisition of an existing chronic care management platform, which offers providers, payers, and Accountable Care Organizations scalable, technology-enhanced services for patients living with chronic conditions. Through consistent, trust-based patient engagement, SPM helps patients navigate the care continuum, focusing on non-clinical factors so physicians can focus on the more critical needs of their patients. We believe that offering these services enables healthcare to be more accessible, convenient, and personalized for our members.

Life is one of the country’s largest and most established DTC insurance distributors for term life insurance, having sold over 2.4 million policies nationwide since our founding in 1985. Our platform provides unbiased comparison shopping for life insurance products such as term life, final expense, and other ancillary products like critical illness, accidental death, and juvenile insurance. We represent approximately 20 leading, nationally-recognized insurance carrier partners, with many of these relationships exceeding 20 years. Term life policies accounted for 44% and 47% of new premium within the Life segment for the three months ended December 31, 2024 and 2023, respectively, with final expense policies accounting for 56% and 53% for the three months ended December 31, 2024 and 2023, respectively. For the six months ended December 31, 2024 and 2023, term life policies accounted for 41% and 48% of new premium within Life, respectively, with final expense policies accounting for 59% and 52%, respectively.

Our other operations which do not meet the criteria to be a separate reportable segment are consolidated and reported as “All other” which represents a shopping platform for auto, home, and specialty insurance lines.

The three and six months ended December 31 referenced throughout the commentary below refers to the second quarter and fiscal year-to-date performance of our fiscal years ending on June 30, 2025 and 2024.

Key Business and Operating Metrics by Segment

In addition to traditional financial metrics, we rely upon certain business and operating metrics to estimate and recognize revenue, evaluate our business performance, and facilitate our operations. In Senior, our primary product, Medicare Advantage, pays us flat commission rates based on the number of policies we sell on behalf of our insurance carrier partners. Therefore, we have determined that units and unit metrics are the most appropriate measures to evaluate the performance of Senior. For Healthcare Services, our primary source of revenue is

pharmacy revenue from SelectRx, so the total number of SelectRx members and the prescriptions shipped per day are the most appropriate measures used to evaluate the performance of Healthcare Services as these metrics drive top-line revenue. In Life, we are typically paid a commission that is a percent of the premium that we generate for our insurance carrier partners. Therefore, we have determined that premium-based metrics are the most relevant measures to evaluate the performance of the segment. Below are the most relevant business and operating metrics for each segment:

Senior

Submitted Policies

Submitted policies are counted when an individual completes an application with our licensed agent and provides authorization to them to submit it to the insurance carrier partner. The applicant may have additional actions to take before the application will be reviewed by the insurance carrier.

The following table shows the number of submitted policies for the periods presented:

	Three Months Ended December 31,		Six Months Ended December 31,
	2024	2023	2024	2023
Medicare Advantage	284,774	271,712	387,055	376,244
All other (1)	26,861	24,049	43,117	38,969
Total	311,635	295,761	430,172	415,213

(1) Represents the submitted policies for medicare supplement, dental, vision and hearing, prescription drug plan and other.

Total submitted policies for all products increased 5% for the three months ended December 31, 2024, compared to the three months ended December 31, 2023. This was driven by a 24% increase in overall close rates, a 33% increase in production per productive agent offset by a 25% decrease in average total productive agents.

Total submitted policies for all products increased 4% for the six months ended December 31, 2024, compared to the six months ended December 31, 2023. This was driven by a 12% increase in overall close rates, a 19% increase in production per productive agent offset by a 13% decrease in average total productive agents.

Approved Policies

Approved policies represents the number of submitted policies that were approved by our insurance carrier partners for the identified product during the indicated period. Not all approved policies will go in force.

The following table shows the number of approved policies for the periods presented:

	Three Months Ended December 31,		Six Months Ended December 31,
	2024	2023	2024	2023
Medicare Advantage	247,849	234,576	339,529	332,257
All other (1)	19,714	19,985	32,693	32,180
Total	267,563	254,561	372,222	364,437

(1) Represents the approved policies for medicare supplement, dental, vision and hearing, prescription drug plan and other.

In general, the relationship between submitted policies and approved policies has been steady over time. Therefore, factors impacting the number of submitted policies also impact the number of approved policies.

Total approved policies for all products increased by 5% for the three months ended December 31, 2024, compared to the three months ended December 31, 2023, which correlates to the increase in submitted policies.

Total approved policies for all products increased 2% for the six months ended December 31, 2024, compared to the six months ended December 31, 2023. Fluctuations in approved policies are normally in direct correlation to submitted policies; however, the approved policies increased slightly less than submitted policies due to carrier mix.

Lifetime Value of Commissions per Approved Policy

The lifetime value of commissions (the “LTV”) per approved policy represents commissions estimated to be collected over the estimated life of an approved policy based on multiple factors, including but not limited to, contracted commission rates, carrier mix, and expected policy persistency with applied constraints. The LTV per approved policy is equal to the sum of the commission revenue due upon the initial sale of a policy, and when applicable, an estimate of future renewal commissions. The estimate of the future renewal commissions is determined using contracted renewal commission rates, which does not include marketing development funds or production bonuses, constrained by a persistency-adjusted 10-year renewal period based on a combination of our historical experience and available insurance carrier historical experience to estimate renewal revenue only to the extent probable that a significant reversal in revenue would not be expected to occur. These factors may result in varying values from period to period. The LTV per approved policy represents commissions only from policies sold during the period; it does not include any updated estimates of prior period variable consideration based on actual policy renewals in the current period.

The following table shows the LTV per approved policy for the periods presented:

	Three Months Ended December 31,				Six Months Ended December 31,
	2024		2023		2024		2023
Medicare Advantage	$	907	$	934	$	881	$	883
All other (1)	111		112		134		131

(1) Represents the weighted average LTV per approved policy.

The LTV per MA approved policy decreased 3% for the three months ended December 31, 2024, compared to the three months ended December 31, 2023, primarily due to carrier mix.

The LTV per MA approved policy decreased less than 1% for the six months ended December 31, 2024, compared to the six months ended December 31, 2023, primarily due to carrier mix.

Healthcare Services

The total number of SelectRx members represents the amount of active customers to which an order has been shipped and the prescriptions per day represents the total average prescriptions shipped per business day. These two metrics are the primary drivers of revenue for Healthcare Services.

SelectRx Members

The following table shows the total number of SelectRx members as of the date presented:

	December 31, 2024	December 31, 2023
Total SelectRx Members	96,695	62,623

The total number of SelectRx members increased by 54% as of December 31, 2024, compared to December 31, 2023, due to our continued operating strategy to grow SelectRx.

Prescriptions Per Day

The following table shows the average prescriptions shipped per day for the periods presented:

	Three Months Ended December 31,		Six Months Ended December 31,
	2024	2023	2024	2023
Prescriptions Per Day	26,846	17,010	25,922	16,244

Life

Life premium represents the total premium value for all policies that were approved by the relevant insurance carrier partner and for which the policy document was sent to the policyholder and payment information was received by the relevant insurance carrier partner during the indicated period. Because our commissions are earned based on a percentage of total premium, total premium volume for a given period is the key driver of revenue for Life.

The following table shows term and final expense premiums for the periods presented:

	Three Months Ended December 31,				Six Months Ended December 31,
(in thousands):	2024		2023		2024		2023
Term Premiums	$	17,311	$	17,398	$	32,529	$	35,588
Final Expense Premiums	22,139		19,388		46,612		39,087
Total	$	39,450	$	36,786	$	79,141	$	74,675

Total term premiums decreased 1% for the three months ended December 31, 2024, compared to the three months ended December 31, 2023, due to a 7% decrease in the number of policies sold, partially offset by a 7% increase in the average premium per policy sold. Final expense premiums increased 14% for the three months ended December 31, 2024, compared to the three months ended December 31, 2023, due to a 4% increase in the average premium per policy sold and a 9% increase in the number of policies sold.

Total term premiums decreased 9% for the six months ended December 31, 2024, compared to the six months ended December 31, 2023, due to a 4% increase in the average premium per policy sold and a 12% decrease in the number of policies sold. Final expense premiums increased 19% for the six months ended December 31, 2024, compared to the six months ended December 31, 2023, due to a 3% increase in the average premium per policy sold and a 16% increase in the number of policies sold.

Key Components of our Results of Operations

The following table sets forth our operating results and related percentage of total revenues for the periods presented:

	Three Months Ended December 31,								Six Months Ended December 31,
(in thousands)	2024				2023				2024				2023
Revenue
Commissions and other services	$	301,069	63	%	$	296,643	73	%	$	440,449	57	%	$	434,584	68	%
Pharmacy	180,000		37	%	108,795		27	%	332,883		43	%	203,583		32	%
Total revenue	481,069		100	%	405,438		100	%	773,332		100	%	638,167		100	%
Operating costs and expenses
Cost of commissions and other services revenue	101,138		21	%	97,424		24	%	166,872		22	%	169,935		27	%
Cost of goods sold—pharmacy revenue	156,201		32	%	94,180		23	%	285,724		37	%	178,188		28	%
Marketing and advertising	97,725		20	%	117,078		29	%	161,489		22	%	179,400		28	%
Selling, general, and administrative	45,021		9	%	33,412		8	%	81,166		10	%	62,078		10	%
Technical development	10,044		2	%	8,050		2	%	19,119		2	%	15,687		2	%
Total operating costs and expenses	410,129		84	%	350,144		86	%	714,370		93	%	605,288		95	%
Income from operations	70,940		15	%	55,294		14	%	58,962		8	%	32,879		5	%
Interest expense, net	(23,721)		(5)	%	(24,415)		(6)	%	(46,752)		(5)	%	(45,811)		(7)	%
Other expense, net	(7,663)		(2)	%	—		—	%	(7,674)		(1)	%	(39)		—	%
Income (loss) before income tax expense (benefit)	39,556		8	%	30,879		8	%	4,536		2	%	(12,971)		(2)	%
Income tax expense (benefit)	(13,680)		(3)	%	11,487		3	%	(4,154)		(1)	%	(1,312)		—	%
Net income (loss)	$	53,236	11	%	$	19,392	5	%	$	8,690	1	%	$	(11,659)	(2)	%

Revenue

We earn revenue in the form of commission payments from our insurance carrier customers, for the initial year the insurance policy is in effect (“first year”) and, where applicable, for each subsequent year the policy renews (“renewal year”), in addition to production bonuses and marketing development funds received from some insurance carriers. Production bonuses are based on attaining various predetermined target sales levels or other agreed upon objectives, whereas marketing development funds may or may not contain such predetermined targets and are used to purchase leads. These, along with other services revenue from Healthcare Services (excluding SelectRx revenue discussed below) and our lead generation business, InsideResponse (of which the majority is eliminated as intersegment revenue), are presented in our consolidated statements of comprehensive income (loss) as commissions and other services revenue. Pharmacy revenue on the consolidated statements of comprehensive income (loss) includes revenue from the sale of prescription and OTC medication products from SelectRx.

Revenue is recognized at different milestones for Senior and Life and is based on the contractual enforceable rights, our historical experience, and established customer business practices. Other services revenues from our Healthcare Services segment (excluding SelectRx revenue discussed below) is recognized when the

performance obligation has been met, which is at different times for our various services (e.g. the HRA has been performed, a transfer has been made to a health-related partner, or SPM has provided care management services to a member), the transaction price is known based on volume and contractual prices, and we have no further performance obligations. Lead generation revenue is recognized when the generated lead is accepted by our customers, which is the point of sale, and we have no performance obligation after the delivery. Revenues generated from SelectRx are recognized upon shipment. At the time of shipment, we have performed all of our performance obligations and control of the product has been transferred to the customer. There are no future revenue streams or variable consideration associated as the transaction price is fixed at time of shipment, and any subsequent new order is its own performance obligation.

The following table presents our revenue for the periods presented and the percentage changes from the prior year:

	Three Months Ended December 31,				Percent Change	Six Months Ended December 31,				Percent Change
(dollars in thousands)	2024		2023		2024 vs. 2023	2024		2023		2024 vs. 2023
Commissions and other services	$	301,069	$	296,643	1%	$	440,449	$	434,584	1%
Pharmacy	180,000		108,795		65%	332,883		203,583		64%
Total revenue	$	481,069	$	405,438	19%	$	773,332	$	638,167	21%

Three Months Ended December 31, 2024 and 2023–Commissions and other services revenue increased $4.4 million, or 1%, for the three months ended December 31, 2024 primarily due to an increase in Senior and Life commissions revenue by $7.9 million and $2.4 million, respectively, offset by a decrease in other commissions revenue of $6.3 million. Senior’s increase was primarily due to a $7.9 million increase in commissions revenue driven by a 5% increase in approved policies. The $2.4 million increase in Life commissions revenue was primarily driven by a $1.8 million increase in final expense revenue. The decrease in other commissions revenue is driven by a $6.3 million decrease in Auto & Home commissions revenue due to the change in strategic direction to reduce revenue growth for Auto & Home based on our limited resources. Pharmacy revenue increased $71.2 million, or 65%, primarily due to the 54% increase in members from the growth of the SelectRx business.

Six Months Ended December 31, 2024 and 2023–Commission and other services revenue increased $5.9 million, or 1%, for the six months ended December 31, 2024, primarily due to increases in Senior and Life commissions revenue of $8.8 million, and $3.8 million, offset by a decrease in other commissions revenue of $9.3 million, respectively. For Senior, this was driven by a 2% increase in approved policies. The increase in Life commissions revenue was primarily by a $6.0 million increase in final expense revenue offset by a $2.2 million decrease in term revenue. The decrease in other commissions revenue is driven by a $9.3 million decrease in Auto & Home commissions revenue due to the change in strategic direction to reduce revenue growth for Auto & Home based on our limited resources. The $129.3 million increase in pharmacy revenue was due to the increase in members due to the expansion of the SelectRx business.

Operating Costs and Expenses

Cost of Commissions and Other Services Revenue

Cost of commissions and other services revenue represents the direct costs associated with fulfilling our obligations to our customers in Senior, Life, and Healthcare Services (excluding SelectRx discussed below); primarily compensation, benefits, and licensing for sales agents, customer success agents, fulfillment specialists, and others directly engaged in serving customers. It also includes allocations for facilities, telecommunications, and software maintenance costs, which are all based on headcount. Facilities costs include rent and utilities expenses and other costs to maintain our office locations. Telecommunications and software maintenance costs includes costs related to the internal phone systems and various software applications that our agents use to make sales. These costs

directly correlate to the number of agents we have as we are primarily charged based on per person usage for the phone systems and software applications.

The following table presents our cost of commissions and other services revenue for the periods presented and the percentage change from the prior year:

	Three Months Ended December 31,				Percent Change	Six Months Ended December 31,				Percent Change
(dollars in thousands)	2024		2023		2024 vs. 2023	2024		2023		2024 vs. 2023
Cost of commissions and other services revenue	$	101,138	$	97,424	4%	$	166,872	$	169,935	(2)%

Three Months Ended December 31, 2024 and 2023—Cost of commissions and other service revenue increased $3.7 million, or 4%, for the three months ended December 31, 2024, primarily due to a $4.8 million increase in compensation costs, offset by a $0.8 million decrease in other operating expenses in Senior. The $4.8 million increase in compensation costs is primarily made up of a $3.6 million increase in costs for our sales and customer care agents in Senior, and a $0.4 million increase in costs for sales and customer care agents in Life.

Six Months Ended December 31, 2024 and 2023—Cost of commissions and other service revenue decreased $3.1 million, or 2%, for the six months ended December 31, 2024, primarily due to a $1.0 million decrease in licensing fees in Senior, combined with a $0.7 million decrease in compensation costs and a $1.1 million decrease in other operating expenses in Senior. The $0.7 million decrease in compensation costs is primarily made up of a $3.2 million decrease in costs for our sales and customer care agents in Senior, offset by a $5.4 million increase in costs for sales and customer care agents in Healthcare Services and a $0.9 million increase in Life.

Cost of Goods Sold-Pharmacy Revenue

Cost of goods sold-pharmacy revenue represents the direct costs associated with fulfilling pharmacy patient orders for SelectRx. Such costs primarily consist of medication costs and compensation costs for licensed pharmacists, pharmacy technicians, and other employees directly associated with fulfilling orders such as packaging and shipping clerks. It also includes shipping, supplies, other order fulfillment costs including part of the one-time customer onboarding costs, and certain facilities overhead costs such as rent, maintenance, and depreciation related to the pharmacy production process.

The following table presents our cost of goods sold-pharmacy revenue for the periods presented and the percentage change from the prior year:

	Three Months Ended December 31,				Percent Change	Six Months Ended December 31,				Percent Change
(dollars in thousands)	2024		2023		2024 vs. 2023	2024		2023		2024 vs. 2023
Cost of goods sold—pharmacy revenue	$	156,201	$	94,180	66%	$	285,724	$	178,188	60%

Three Months Ended December 31, 2024 and 2023–Cost of goods sold-pharmacy revenue increased $62.0 million, or 66%, for the three months ended December 31, 2024, primarily due to a $53.8 million increase in medication costs as the number of SelectRx members increased 54% over the prior year as well as a $4.7 million increase in compensation costs due to a 64% increase in the number of employees directly associated with fulfilling pharmacy orders.

Six Months Ended December 31, 2024 and 2023–Cost of goods sold-pharmacy revenue increased $107.5 million, or 60%, for the six months ended December 31, 2024, primarily due to an $92.0 million increase in

medication costs as the number of SelectRx members increased 54% over the prior year as well as a $10.0 million increase in compensation costs due to a 74% increase in the number of employees directly associated with fulfilling pharmacy orders.

Marketing and Advertising

Marketing and advertising expenses consist primarily of the direct costs associated with marketing and advertising of our services, such as television and radio commercials and online advertising. These direct costs generally represent the vast majority of our marketing and advertising expenses. Other costs consist of compensation and other expenses related to marketing, business development, partner management, public relations, carrier relations personnel who support our offerings, and allocations for facilities, telecommunications, and software maintenance costs. Our marketing and advertising costs increase during AEP and OEP to generate more leads during these high-volume periods.

The following table presents our marketing and advertising expenses for the periods presented and the percentage changes from the prior year:

	Three Months Ended December 31,				Percent Change	Six Months Ended December 31,				Percent Change
(dollars in thousands)	2024		2023		2024 vs. 2023	2024		2023		2024 vs. 2023
Marketing and advertising	$	97,725	$	117,078	(17)%	$	161,489	$	179,400	(10)%

Three Months Ended December 31, 2024 and 2023–Marketing and advertising expenses decreased $19.4 million, or 17%, for the three months ended December 31, 2024, primarily due to a $16.3 million decrease in lead costs and a $2.2 million decrease in compensation costs. The decrease in lead costs was attributable to an increase in close rates of approximately 25% for Senior during the 2024 AEP period.

Six Months Ended December 31, 2024 and 2023–Marketing and advertising expenses decreased $17.9 million, or 10%, for the six months ended December 31, 2024, due to a $15.2 million decrease in lead costs and a $1.9 million decrease in compensation costs. The decrease in lead costs was attributable to an increase in close rates of approximately 25% for Senior during the 2024 AEP period.

Selling, General, and Administrative

Selling, general, and administrative expenses include compensation and benefits costs for staff working in our executive, finance, accounting, recruiting, human resources, administrative, business intelligence, data science, and part of the SelectRx customer onboarding departments. These expenses also include fees paid for outside professional services, including audit, tax, and legal fees and allocations for facilities, telecommunications, and software maintenance costs.

The following table presents our selling, general, and administrative expenses for the periods presented and the percentage changes from the prior year:

	Three Months Ended December 31,				Percent Change	Six Months Ended December 31,				Percent Change
(dollars in thousands)	2024		2023		2024 vs. 2023	2024		2023		2024 vs. 2023
Selling, general, and administrative	$	45,021	$	33,412	35%	$	81,166	$	62,078	31%

Three Months Ended December 31, 2024 and 2023–Selling, general, and administrative expenses increased $11.6 million, or 35%, for the three months ended December 31, 2024, primarily due to a $4.9 million increase in compensation costs, a $2.0 million increase in bad debt expense related to SelectRx, and a $4.5 million increase in corporate development. The increase in compensation costs was primarily related the growth of SelectRx. The increase in corporate development is related to the securitization transaction.

Six Months Ended December 31, 2024 and 2023–Selling, general, and administrative expenses increased $19.1 million, or 31%, for the six months ended December 31, 2024, primarily due to $10.1 million increase in compensation costs, a $4.2 million increase in bad debt expense related to SelectRx and a $3.1 million increase in corporate development. The increase in compensation costs was primarily related the growth of SelectRx. The increase in corporate development is related to the securitization transaction.

Technical Development

Technical development expenses consist primarily of compensation and benefits costs for internal and external personnel associated with developing, maintaining and enhancing our applications, infrastructure and other IT-related functions as well as allocations for facilities, telecommunications and software maintenance costs.

The following table presents our technical development expenses for the periods presented and the percentage changes from the prior year:

	Three Months Ended December 31,				Percent Change	Six Months Ended December 31,				Percent Change
(dollars in thousands)	2024		2023		2024 vs. 2023	2024		2023		2024 vs. 2023
Technical development	$	10,044	$	8,050	25%	$	19,119	$	15,687	22%

Three Months Ended December 31, 2024 and 2023–Technical development expenses increased $2.0 million, or 25%, for the three months ended December 31, 2024, primarily due to a $1.6 million increase in compensation costs due to an increase in headcount for technology personnel and a $0.2 million increase in costs related to trainings and seminars.

Six Months Ended December 31, 2024 and 2023–Technical development expenses increased $3.4 million, or 22%, for the six months ended December 31, 2024, primarily due to a $3.2 million increase in compensation costs due to an increase in headcount for technology personnel.

Interest Expense, Net

The following table presents our interest expense, net for the periods presented and the percentage changes from the prior year:

	Three Months Ended December 31,				Percent Change	Six Months Ended December 31,				Percent Change
(dollars in thousands)	2024		2023		2024 vs. 2023	2024		2023		2024 vs. 2023
Interest expense, net	$	23,721	$	24,415	(3)%	$	46,752	$	45,811	2%

Three Months Ended December 31, 2024 and 2023–Interest expense decreased $0.7 million, or 3%, for the three months ended December 31, 2024, as a result of the Company’s lower cost of capital after completing the securitization transaction.

Six Months Ended December 31, 2024 and 2023–Interest expense increased $0.9 million, or 2%, for the six months ended December 31, 2024, as a result of higher interest rates during the period.

Income Taxes

The following table presents our provision for income taxes for the periods presented and the percentage changes from the prior year:

	Three Months Ended December 31,						Percent Change	Six Months Ended December 31,						Percent Change
(dollars in thousands)	2024			2023			2024 vs. 2023	2024			2023			2024 vs. 2023
Income tax expense (benefit)	$	(13,680)		$	11,487		(219)%	$	(4,154)		$	(1,312)		217%
Effective tax rate	(34.6)		%	37.2		%		(91.6)		%	10.1		%

Three Months Ended December 31, 2024 and 2023–For the three months ended December 31, 2024 and 2023, we recognized income tax benefit and expense of $13.7 million and $11.5 million, respectively, representing effective tax rates of (34.6)% and 37.2%, respectively. The differences from the federal statutory tax rate to the effective tax rates for the three months ended December 31, 2024, were primarily related to state income taxes, the recording of a valuation allowance for federal and state tax attributes that the Company does not expect to utilize prior to expiration, vesting of restricted stock units, and non-deductibility of warrant market adjustments. The differences from the federal statutory tax rate to the effective tax rates for the three months ended December 31, 2023, were primarily related to state income taxes and the recording of a valuation allowance for federal tax attributes that the Company does not expect to utilize prior to expiration.

Six Months Ended December 31, 2024 and 2023–For the six months ended December 31, 2024 and 2023, the Company recognized income tax benefits of $4.2 million and $1.3 million, respectively, representing effective tax rates of (91.6)% and 10.1%, respectively. The differences from the federal statutory tax rate to the effective tax rate for the six months ended December 31, 2024, were primarily related to state income taxes, the recording of a valuation allowance for federal and state tax attributes that the Company does not expect to utilize prior to expiration, vesting of restricted stock units, and non-deductibility of warrant market adjustments. The differences from the federal statutory tax rate to the effective tax rate for the six months ended December 31, 2023, were primarily related to state income taxes and the recording of a valuation allowance for federal tax attributes that the Company does not expect to utilize prior to expiration.

Segment Information

As of July 1, 2024, the Company has realigned its reportable segments for fiscal year 2025. The Auto & Home business does not meet the quantitative thresholds to be required to continue to be separately disclosed as a reportable segment in accordance with ASC 280. As a result, the Auto & Home business will be included in an “All Other” category. Prior period information has been recast to conform to the current presentation.

The Company’s operating segments have been determined in accordance with ASC 280. We currently have three reportable segments: i) Senior, ii) Healthcare Services, and iii) Life. Senior primarily sells senior Medicare-related health insurance products. Healthcare Services includes SelectRx, Population Health, and most recently, SelectPatient Management. Healthcare Services provides products and services to our Medicare policyholders, which are focused on improving patient health outcomes. Life primarily sells term life and final expense products. The All Other category is reflective of the revenue generated from selling individual automobile and homeowners’ insurance. Additionally, the Company accounts for non-operating activity, share-based compensation expense, depreciation and amortization, goodwill, long-lived asset and intangible asset impairments, certain intersegment eliminations, and the costs of providing corporate and other administrative services in our administrative division, Corporate & Eliminations. These services are not directly identifiable with our reportable segments and are shown in the tables below to reconcile the reportable segments to the consolidated financial statements. We have not aggregated any operating segments together to represent a reportable segment.

Our operating segments are determined based on how our chief executive officer, who also serves as our CODM manages our business, regularly accesses information, and evaluates performance for operating decision-

making purposes, including allocation of resources. Adjusted EBITDA is our segment profit measure and a key measure used by our CODM and Board of Directors to understand and evaluate the operating performance of our business and on which internal budgets and forecasts are based and approved. We define Adjusted EBITDA as income (loss) before income tax expense (benefit) plus: (i) interest expense, net; (ii) depreciation and amortization; (iii) share-based compensation; (iv) goodwill, long-lived asset, and intangible assets impairments; (v) transaction costs; (vi) loss on disposal of property, equipment and software, net; (vii) other non-recurring expenses and income; and (viii) changes in fair value of warrant liabilities.

The following tables present information about the reportable segments for the periods presented. We do not report total assets by segment as our CODM does not use this information to evaluate operating segment performance. Accordingly, we do not regularly provide such information by segment to our CODM.

Our segment disclosure includes intersegment revenues, which consist of affiliate marketing fees for services provided by our Senior segment to our Healthcare Services and Life segments as well as services provided by Life to other segments. These intersegment transactions are recorded by each segment at amounts that we believe approximate fair value as if the transactions were between third parties and, therefore, impact segment performance. However, the revenue and corresponding expense are eliminated in consolidation. The elimination of such intersegment transactions is included within the “Eliminations of intersegment revenues” and “Corporate & elimination of intersegment profits’ captions in the tables below.

Three Months Ended December 31, 2024:

(in thousands)	Senior		Healthcare Services		Life		Total
External revenue	$	253,805	$	183,281	$	39,840	$	476,926
Intersegment revenue	1,773		89		21		1,883
Total revenue from reportable segments	$	255,578	$	183,370	$	39,861	$	478,809
All other revenue							4,143
Eliminations of intersegment revenues							(1,883)
Total consolidated revenue							$	481,069

(in thousands)	Senior		Healthcare Services		Life		Total
Adjusted Segment EBITDA	$	100,521	$	2,212	$	7,423	$	110,156
All other Adjusted EBITDA							2,303
Corporate & elimination of intersegment profits							(24,940)
Share-based compensation expense							(4,699)
Transaction costs (1)							(6,719)
Depreciation and amortization							(5,060)
Loss on disposal of property, equipment, and software, net							(122)
Change in fair value of warrant liabilities							(7,642)
Interest expense, net							(23,721)
Income before income tax expense (benefit)							$	39,556

(1) These expenses primarily consist of financing transaction costs ($6.7 million).

Three Months Ended December 31, 2023

(in thousands)	Senior		Healthcare Services		Life		Total
External revenue	$	245,897	$	111,710	$	37,344	$	394,951
Intersegment revenue	1,632		—		23		1,655
Total revenue from reportable segments	$	247,529	$	111,710	$	37,367	$	396,606
All other revenue							10,487
Eliminations of intersegment revenues							(1,655)
Total consolidated revenue							$	405,438

(in thousands)	Senior		Healthcare Services		Life		Total
Adjusted Segment EBITDA	$	78,713	$	2,981	$	4,569	$	86,263
All other Adjusted EBITDA							4,725
Corporate & elimination of intersegment profits							(23,574)
Share-based compensation expense							(3,822)
Transaction costs (1)							(2,400)
Depreciation and amortization							(5,898)
Loss on disposal of property, equipment, and software							—
Interest expense, net							(24,415)
Income before income tax expense (benefit)							$	30,879

(1) These expenses primarily consist of financing transaction costs.

Six Months Ended December 31, 2024:

(in thousands)	Senior		Healthcare Services		Life		Total
External revenue	$	345,169	$	338,947	$	79,106	$	763,222
Intersegment revenue	3,318		161		45		3,524
Total revenue from reportable segments	$	348,487	$	339,108	$	79,151	$	766,746
All other revenue							10,110
Eliminations of intersegment revenues							(3,524)
Total consolidated revenue							$	773,332

(in thousands)	Senior		Healthcare Services		Life		Total
Adjusted Segment EBITDA	$	108,247	$	7,089	$	13,383	$	128,719
All other Adjusted EBITDA							6,099
Corporate & elimination of intersegment profits							(48,983)
Share-based compensation expense							(8,545)
Transaction costs (1)							(7,544)
Depreciation and amortization							(10,659)
Loss on disposal of property, equipment, and software, net							(157)
Change in fair value of warrant liabilities							(7,642)
Interest expense, net							(46,752)
Income before income tax expense (benefit)							$	4,536

(1) These expenses primarily consist of non-restructuring severance expenses ($0.5 million) and financing transaction costs ($7.0 million).

Six Months Ended December 31, 2023

(in thousands)	Senior		Healthcare Services		Life		Total
External revenue	$	334,458	$	209,078	$	75,116	$	618,652
Intersegment revenue	2,987		—		54		3,041
Total revenue from reportable segments	$	337,445	$	209,078	$	75,170	$	621,693
All other revenue							19,515
Eliminations of intersegment revenues							(3,041)
Total consolidated revenue							$	638,167

(in thousands)	Senior		Healthcare Services		Life		Total
Adjusted Segment EBITDA	$	77,376	$	5,304	$	9,808	$	92,488
All other Adjusted EBITDA							8,045
Corporate & elimination of intersegment profits							(44,495)
Share-based compensation expense							(6,997)
Transaction costs (1)							(4,305)
Depreciation and amortization							(11,887)
Loss on disposal of property, equipment, and software							(9)
Interest expense, net							(45,811)
Loss before income tax expense (benefit)							(12,971)

(1) These expenses primarily consist of financing transaction costs.

The following table depicts the disaggregation of revenue by segment and product for the periods presented:

	Three Months Ended December 31,								Six Months Ended December 31,
(dollars in thousands)	2024		2023		$		%		2024		2023		$		%
Senior:
Medicare advantage commissions	$	226,716	$	217,969	$	8,747	4	%	$	301,187	$	292,340	$	8,847	3	%
Other Senior commissions	2,185		3,048		(863)		(28)	%	4,765		4,840		(75)		(2)	%
Other services	26,677		26,512		165		1	%	42,535		40,265		2,270		6	%
Total Senior revenue	255,578		247,529		8,049		3	%	348,487		337,445		11,042		3	%
Healthcare Services:
Pharmacy	180,000		108,795		71,205		65	%	332,883		203,583		129,300		64	%
Other services	3,370		2,915		455		16	%	6,225		5,495		730		13	%
Total Healthcare Services revenue	183,370		111,710		71,660		64	%	339,108		209,078		130,030		62	%
Life:
Term commissions	18,666		18,113		553		3	%	35,030		37,227		(2,197)		(6)	%
Final expense commissions	16,283		14,482		1,801		12	%	34,607		28,602		6,005		21	%
Other services	4,912		4,772		140		3	%	9,514		9,341		173		2	%
Total Life revenue	39,861		37,367		2,494		7	%	79,151		75,170		3,981		5	%
All other:
Commissions	3,972		10,275		(6,303)		(61)	%	9,767		19,090		(9,323)		(49)	%
Other services	171		212		(41)		(19)	%	343		425		(82)		(19)	%
Total All other revenue	4,143		10,487		(6,344)		(60)	%	10,110		19,515		(9,405)		(48)	%
Eliminations:
Commissions	(1,022)		(662)		(360)		54	%	(1,665)		(1,118)		(547)		49	%
Other services	(861)		(993)		132		(13)	%	(1,859)		(1,923)		64		(3)	%
Total Elimination revenue	(1,883)		(1,655)		(228)		14	%	(3,524)		(3,041)		(483)		16	%
Total Commissions and other services revenue	301,069		296,643		4,426		1	%	440,449		434,584		5,865		1	%
Total Pharmacy revenue	180,000		108,795		71,205		65	%	332,883		203,583		129,300		64	%
Total Revenue	$481,069		$405,438		$75,631		19	%	$773,332		$638,167		$135,165		21	%

Revenue by Segment

Three Months Ended December 31, 2024 and 2023–Revenue from our Senior segment was $255.6 million for the three months ended December 31, 2024, a $8.0 million, or 3%, increase compared to revenue of $247.5 million for the three months ended December 31, 2023. The increase was due to an $7.9 million, or 4%, increase in commissions revenue.

Revenue from Healthcare Services was $183.4 million for the three months ended December 31, 2024, a $71.7 million, or 64%, increase compared to revenue of $111.7 million for the three months ended December 31, 2023, primarily due to a $71.2 million increase in SelectRx pharmacy revenue.

Revenue from our Life segment was $39.9 million for the three months ended December 31, 2024, a $2.5 million, or 7%, increase compared to revenue of $37.4 million for the three months ended December 31, 2023, primarily due to an $2.4 million increase in commissions revenue.

Six Months Ended December 31, 2024 and 2023–Revenue from Senior was $348.5 million for the six months ended December 31, 2024, a $11.0 million, or 3%, increase compared to revenue of $337.4 million for the six months ended December 31, 2023. The increase was due to a $8.8 million, or 3%, increase in commission revenue combined with a $2.3 million increase in other revenue.

Revenue from Healthcare Services was $339.1 million for the six months ended December 31, 2024, a $130.0 million, or 62%, increase compared to revenue of $209.1 million for the six months ended December 31, 2023, primarily due to a $129.3 million increase in SelectRx pharmacy revenue.

Revenue from Life was $79.2 million for the six months ended December 31, 2024, a $4.0 million, or 5%, increase compared to revenue of $75.2 million for the six months ended December 31, 2023, in line with our updated operating strategy to stabilize our distribution business.

Adjusted EBITDA by Segment

Three Months Ended December 31, 2024 and 2023–Adjusted EBITDA from our Senior segment was $100.5 million for the three months ended December 31, 2024, a $21.8 million, or 28%, increase compared to Adjusted EBITDA of $78.7 million for the three months ended December 31, 2023. The increase was due to a $8.0 million increase in revenue and a $13.8 million decrease in operating costs and expenses, primarily due to a $14.4 million decrease in lead costs partially offset by a $3.6 million increase in compensation costs in Senior.

Adjusted EBITDA from Healthcare Services was $2.2 million for the three months ended December 31, 2024, a $0.8 million decrease compared to Adjusted EBITDA of $3.0 million for the three months ended December 31, 2023. The decrease was due to a $71.7 million increase in revenue, offset by a $72.4 million increase in operating costs and expenses primarily as a result of a $53.8 million increase in medication costs and a $12.7 million increase in compensation costs to support and invest in the growth of SelectRx.

Adjusted EBITDA from our Life segment was $7.4 million for the three months ended December 31, 2024, a $2.9 million, or 62%, increase compared to Adjusted EBITDA of $4.6 million for the three months ended December 31, 2023. The increase in Adjusted EBITDA was due to a $2.5 million increase in revenue and a $0.3 million decrease in operating costs. The decrease in operating costs was primarily due to a $0.8 million decrease in marketing and advertising, partially offset by a $0.7 million increase in compensation costs.

Six Months Ended December 31, 2024 and 2023–Adjusted EBITDA from Senior was $108.2 million for the six months ended December 31, 2024, a $30.9 million increase compared to Adjusted EBITDA of $77.4 million for the six months ended December 31, 2023. The increase was due to a $11.0 million increase in revenue and a $19.8 million decrease in operating costs and expenses primarily due to a $14.4 million reduction in sales and marketing costs, and a $4.5 million reduction in compensation costs.

Adjusted EBITDA from Healthcare Services was $7.1 million for the six months ended December 31, 2024, a $1.8 million increase compared to Adjusted EBITDA of $5.3 million for the six months ended December 31, 2023. The increase was due to a $128.2 million increase in operating costs and expenses primarily as a result of the $92.0 million increase in medication costs and a $24.6 million increase in compensation costs to support and invest in the growth of SelectRx. The increase in operating costs and expenses was offset by the $130.0 million increase in revenue as discussed above.

Adjusted EBITDA from Life was $13.4 million for the six months ended December 31, 2024, a $3.6 million increase compared to Adjusted EBITDA of $9.8 million for the six months ended December 31, 2023. The increase was due to a $0.4 million increase in operating costs and expenses primarily due to a $1.6 million increase

in compensation costs, offset by a $1.0 million decrease in advertising and marketing costs. The decrease in operating costs and expenses was offset by the $4.0 million increase in revenue as discussed above.

Liquidity and Capital Resources

Our liquidity needs primarily include working capital and debt service requirements. Additionally, we are required under the Senior Secured Credit Facility and Indenture to maintain compliance with certain debt covenants, as discussed further in Note 6 to the condensed consolidated financial statements. Based on our financial projections, we believe we will remain in compliance with the debt covenants through the 12 months following the date of issuance of our condensed consolidated financial statements.

Long-term Debt

Significant changes and activity related to our long-term debt since our Quarterly Report on Form 10-Q for the quarter ended September 30, 2024 are discussed below. Refer to Note 6 “Debt” for further discussion on our debt agreements and activity.

Securitization and Indenture

On October 15, 2024, the Company completed a $100.0 million securitization transaction to provide advanced financing against the expected collections for policies previously sold. The Company used the proceeds to pay down a portion of its outstanding term loans. During the six months ended December 31, 2024, the Company received proceeds of $99.1 million, and as of December 31, 2024, had outstanding borrowings of $93.7 million. Refer to Note 6 for further information.

Senior Secured Credit Facility

On October 15, 2024 and in connection with the Indenture, the Company entered into the Eleventh Amendment to its Credit Agreement to (1) extend the scheduled maturity date of the existing term loans, (2) modify financial covenant ratios required to be maintained by the Company for various reporting dates to allow the Company to stay in compliance with the required covenants, and (3) allow the Company to enter into the securitization transaction.

During the six months ended December 31, 2024, the Company repaid $123.2 million of the outstanding term loans, and as of December 31, 2024, had outstanding borrowings of $574.7 million related to the term loans. Refer to Note 6 for further information.

During the six months ended December 31, 2024, the Company received proceeds of $84.9 million and repaid $26.9 million, and as of December 31, 2024, had outstanding borrowings of $58.0 million related to the revolving credit facility. Refer to Note 6 for further information.

Liquidity

As of December 31, 2024 and June 30, 2024, the Company had total debt obligations of $711.9 million and $683.3 million, respectively, under the Senior Secured Credit Facility and the Notes. Management expects that our existing cash, cash equivalents, funds available under the revolving credit facility and cash provided from operations will be sufficient to finance normal working capital needs, investments in properties, facilities and equipment and debt services.

On February 10, 2025, the Company entered into the Senior Preferred Stock Purchase Agreements, pursuant to which the Company will receive aggregate cash proceeds of $339.5 million in connection with the issuance of the Preferred Stock and Preferred Warrants after giving effect to a 3% original issue discount. The Company will use the proceeds to pay $23.0 million of fees incurred in connection with the transactions

contemplated by the Senior Preferred Stock Purchase Agreements, pay down $260.0 million of the outstanding term loan balance, and the remainder to fund operations and pay down the revolving credit facility.

We do not expect to generate sufficient cash flows from operations to enable us to make the remaining milestone payments contemplated in the Eleventh Amendment. If we are unable to secure additional financing from outside sources or otherwise amend the Senior Secured Credit Facility, we will need to obtain additional capital through other means, including future securitization transactions, selling one or more material assets, or substantially reducing the scope of certain of our operations. If we are unable to satisfy our repayment obligations under the Senior Secured Credit Facility or maintain compliance with the covenants therein, we may be in default, which would significantly affect our liquidity.

As of December 31, 2024 and June 30, 2024, our cash, cash equivalents, and restricted cash totaled $13.6 million and $42.7 million, respectively. Additionally, the following table presents a summary of our cash flows for the periods presented below:

	Six Months Ended December 31,
(in thousands)	2024		2023
Net cash used in operating activities	$	(45,304)	$	(49,239)
Net cash used in investing activities	(4,846)		(5,692)
Net cash provided (used in) financing activities	21,093		(17,376)

Operating Activities

Net cash used in operating activities primarily consists of net income, adjusted for certain non-cash items including depreciation; amortization of intangible assets and internally developed software; deferred income taxes; share-based compensation expense; amortization of debt issuance costs and discount; accrued interest; non-cash lease expenses; and the effect of changes in working capital and other activities.

Collection of commissions receivable depends upon the timing of our receipt of commission payments and associated commission statements from our insurance carrier partners. If we were to experience a delay in receiving a commission payment from an insurance carrier partner within a quarter, our operating cash flows for that quarter could be adversely impacted.

A significant portion of our marketing and advertising expenses is driven by the number of leads required to generate the insurance applications we submit to our insurance carrier partners. Our marketing and advertising costs are expensed and generally paid as incurred and since commission revenue is recognized upon approval of a policy but commission payments are paid to us over time, there are working capital requirements to fund the upfront cost of acquiring new policies. During AEP, we experience an increase in the number of submitted Senior insurance applications and marketing and advertising expenses compared to periods outside of AEP. The timing of AEP affects the positive or negative impacts of our cash flows during each quarter.

Six Months Ended December 31, 2024—Net cash used in operating activities was $45.3 million, consisting of net income of $8.7 million, adjustments for non-cash items of $41.0 million, and cash used in operating assets and liabilities of $95.0 million. Adjustments for non-cash items primarily consisted of $10.7 million of depreciation and amortization, $8.5 million of share-based compensation expense, $9.7 million of accrued interest payable in kind on the term loans, $2.4 million of amortization of debt issuance costs and debt discount, $1.8 million of non-cash lease expense, $4.2 million in deferred income taxes, $4.2 million in bad debt expense, and $7.6 million in the change in fair value of warrant liabilities. The cash decrease resulting from changes in net operating assets and liabilities primarily consisted of a decrease of $30.0 million in accounts receivable, an increase of $46.2 million in accounts payable and accrued expenses, offset by an increase of $155.5 million in commissions receivable, due to a 2% increase in approved policies for the six months, a decrease of $8.7 million in other liabilities, primarily related to an $7.1 million decrease in our contract liability, and a $1.9 million decrease in accrued compensation and

benefits, a decrease of $2.3 million in operating lease liabilities and an increase of $4.8 million in other assets, primarily related to hedge activities.

Six Months Ended December 31, 2023—Net cash used in operating activities was $49.2 million, consisting of a net loss of $11.7 million, adjustments for non-cash items of $34.4 million, and cash used in operating assets and liabilities of $71.9 million. Adjustments for non-cash items primarily consisted of $11.9 million of depreciation and amortization, $7.0 million of share-based compensation expense, $9.0 million of accrued interest payable in kind, $3.4 million of amortization of debt issuance costs and debt discount, $1.5 million of non-cash lease expense and $2.7 million in bad debt expense, offset by $1.2 million in deferred income taxes. The cash decrease resulting from changes in net operating assets and liabilities primarily consisted of an increase of $113.9 million in commissions receivables, offset by an increase of $29.2 million in accounts payable and accrued expenses, a decrease of $9.2 million in accounts receivable, net and an $8.2 million increase in other liabilities.

Investing Activities

Our investing activities primarily consist of purchases of property, equipment, and software and capitalized salaries related to the development of internal-use software.

Six Months Ended December 31, 2024—Net cash used in investing activities of $4.8 million was due to $4.1 million in purchases of software and capitalized internal-use software development costs and $0.7 million of purchases of property and equipment, primarily made up of machinery and equipment and leasehold improvements.

Six Months Ended December 31, 2023—Net cash used in investing activities of $5.7 million was due to $3.9 million in purchases of software and capitalized internal-use software development costs and $2.1 million of purchases of property and equipment, primarily computer equipment and leasehold improvements.

Financing Activities

Our financing activities primarily consist of payments on term loans, proceeds and payments related to the revolving credit facility, payments on notes issued in connection with the Indenture, payments for debt issuance costs, and proceeds and payments related to stock-based compensation.

Six Months Ended December 31, 2024—Net cash provided in financing activities of $21.1 million was primarily due to $123.2 million of principal payments on the term loans, $6.3 million of payments on the notes issued in connection with the Indenture, $26.9 million of payments on the revolving credit facility, offset by $99.1 million of proceeds on the notes issued in connection with the Indenture and $84.9 million of proceeds from the revolving credit facility.

Six Months Ended December 31, 2023—Net cash used in financing activities of $17.4 million was primarily due to $16.9 million of principal payments on the term loans.

Contractual Obligations

Other than the discussions in Notes 6, 9, and 11 to the condensed consolidated financial statements, as of December 31, 2024, there have been no material changes to our contractual obligations as previously described in our Annual Report.

Off-Balance Sheet Arrangements

We did not have any off-balance sheet arrangements during the period covered by this report.

Recent Accounting Pronouncements

For a discussion of new accounting pronouncements recently adopted and not yet adopted, see the notes to our condensed consolidated financial statements.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS

We are primarily exposed to the market risk associated with unfavorable movements in interest rates. The risk inherent in our market risk-sensitive instruments and positions is the potential loss or increased expense arising from adverse changes in those factors. There have been no material changes to our market risk policies or our market risk-sensitive instruments and positions as described in our Annual Report.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Our Disclosure Controls and Procedures

As of December 31, 2024, an evaluation of the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) was carried out by our management, with the participation of our chief executive officer (principal executive officer) and our chief financial officer (principal financial and accounting officer). Based upon our management's evaluation, our chief executive officer and our chief financial officer have concluded that as of the end of the period covered by this report, our disclosure controls and procedures are effective to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms and (ii) accumulated and communicated to our management, including our chief executive officer and chief financial officer, to allow timely decisions regarding required disclosure.

In designing and evaluating our disclosure controls and procedures, our management recognized that any controls and procedures, no matter how well designed and operated, can provide only a reasonable level of assurance of achieving their desired control objectives, and our management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, controls may become inadequate because of changes in conditions, or the degree of compliance with policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

Changes in Internal Control over Financial Reporting

There have been no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during the first quarter of fiscal 2025 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II

OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

A discussion of legal proceedings to which the Company is a party is included in Part I, Item 1 hereof under “Note 10, Commitments and Contingencies – Legal Contingencies and Obligations,” which is incorporated herein by reference.

ITEM 1A. RISK FACTORS

There have been no material changes to the risk factors set forth in our Annual Report. Before investing in our securities, we recommend that investors carefully consider the risks described in our Annual Report, including those under the heading “Risk Factors.” Realization of any of these risks and any additional risks and uncertainties not currently known to us or that we have deemed to be immaterial could have a material adverse effect on our business, financial condition, or results of operations.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Except as previously reported by the Company on its current reports on Form 8-K, the Company did not sell any securities during the period covered by this Form 10-Q that were not registered under the Securities Act.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

Not applicable.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

Except as set forth below, none of our officers or directors adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement” (each as defined in Item 408 of Regulation S-K) during the three and six months ended December 31, 2024.

On November 21, 2024, Sarah Anderson, Executive Vice President of Pharmacy, adopted a Rule 10b5-1 trading arrangement for the sale of up to 50,000 shares of our common stock, subject to certain conditions. The arrangement’s expiration date is February 27, 2026.

ITEM 6. EXHIBITS

The following documents listed below are incorporated by reference or are filed or furnished, as applicable, with this Quarterly Report on Form 10-Q.

Exhibit Number	Exhibit Description
31.1	Certification of Chief Executive Officer of SelectQuote, Inc. Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2	Certification of Chief Financial Officer of SelectQuote, Inc. Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1†	Certification of Chief Executive Officer of SelectQuote, Inc. Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2†	Certification of Chief Financial Officer of SelectQuote, Inc. Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS	XBRL Instance Document - The instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
101.SCH	Inline XBRL Taxonomy Extension Schema Document
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.LAB	Inline XBRL Taxonomy Extension Labels Linkbase Document
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document
104	Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)

#     Indicates management contract or compensatory plan.

*    Portions of this exhibit have been omitted pursuant to Item 601(b)(10)(iv) of Regulation S-K.

†     The certifications attached as Exhibits 32.1 and 32.2 that accompany this Quarterly Report on Form 10-Q, are not deemed filed with the SEC and are not to be incorporated by reference into any filing of SelectQuote, Inc. under the Securities Act or the Exchange Act, whether made before or after the date of this Quarterly Report on Form 10-Q, irrespective of any general incorporation language contained in such filing.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	SELECTQUOTE, INC.
February 10, 2025	By: /s/ Tim Danker
	Name: Tim Danker
	Title: Chief Executive Officer
	By: /s/ Ryan Clement
	Name: Ryan Clement
	Title: Chief Financial Officer