Key Highlights

  • Adjusted diluted EPS was USD 0.28 against an estimate of USD 0.26, while GAAP diluted EPS was USD 0.09.
  • Total revenues were USD 79.9 million against an estimate of USD 79.48 million and USD 64.1 million a year earlier.
  • Total Written Premium reached USD 554.2 million, and the organic Revenue growth rate stood at 16.6% for the quarter.
  • Net income was USD 9.0 million against USD 9.6 million, while Adjusted EBITDA was USD 19.5 million.

How does an insurance distributor grow commissions faster than premium while Net Income is lower than a year ago? TWFG, Inc. (NASDAQ:TWFG) reported third quarter total revenues of USD 79.9 million, against USD 64.1 million a year earlier, and adjusted diluted EPS of USD 0.28 against GAAP diluted EPS of USD 0.09. Net income was USD 9.0 million against USD 9.6 million, a net income Margin of 11.3% against 15.0%.

Premium Volume and Commission Mix

Total written premium was USD 554.2 million, which the company stated as an 18.5% increase from USD 467.7 million. Management described the growth as volume-led rather than rate-driven in a moderating rate environment, with higher policy counts and premium retention of 88%. Growth came from Agency-in-a-Box, Corporate Stores and MGA operations, together with acquisitions.

Commission income was USD 73.4 million, up 25.9%, which the company said outpaced premium growth by 740 basis points as the Business mix shifted toward programs with higher commission rates. Organic revenue was USD 68.7 million, a growth rate of 16.6%. Chief executive Gordy Bunch tied the quarter to growth across the platform and to contributions from recent acquisitions.

Expenses, Acquisitions and Profit Measures

Commission expense rose 20.9% to USD 41.9 million, which management linked to the same mix shift and to lower commission expense associated with corporate store acquisitions. Salaries and employee benefits were USD 11.8 million against USD 9.9 million because of added headcount from the Acquisition strategy. Other administrative expenses were USD 9.7 million, up 85.8%, on professional and legal fees tied to Capital Markets and Credit Facility expansion and on growth investments.

Adjusted net income increased 16.3% to USD 15.1 million, with an adjusted net income margin of 18.9% against 20.2%. Adjusted EBITDA grew 15.0% to USD 19.5 million, and its margin was 24.4% against 26.5%. Management attributed the EBITDA result to MGA operations and recent acquisitions, including APIA and corporate store additions. The company completed the branch conversion acquisition of Select Insurance Solutions during the quarter, joining Loften Wells, Fortress Insurance Services and APIA among 2026 deals.

Cash, Credit and Cash Flow

Unrestricted cash and cash equivalents were USD 77.8 million at September 30, with the USD 125.0 million revolving credit facility fully unused and term notes payable of USD 2.5 million. Cash Flow from Operating Activities was USD 10.6 million against USD 15.0 million, and adjusted free cash flow was USD 7.5 million against USD 12.3 million, which the company linked to higher commission receivables and lower commission payables, together with lower net income, partly offset by higher amortization.

Benchmarks Ahead

Quarterly revenue of USD 79.9 million sits alongside written premium of USD 554.2 million, Adjusted EBITDA of USD 19.5 million and cash of USD 77.8 million. The company updated its full year 2026 guidance: organic revenue growth of 15% to 17% against 13% to 17% previously, an Adjusted EBITDA margin of 24% to 27% against 23% to 27%, and total revenues unchanged at USD 300 million to USD 320 million.

Management said the update reflects performance across its core businesses and subsequent acquisitions. It scheduled an Investor Day for November 12, 2026 from 10:00 a.m. to 3:00 p.m. Central Time at its home office in The Woodlands, Texas.