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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 June 30, 2026
OR
☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the transition period from _________to
Commission File Number: 001-40645
____________
RYAN SPECIALTY HOLDINGS, INC.
(Exact name of registrant as specified in its charter)
____________
Delaware | 86-2526344 | |||
(State or Other Jurisdiction of Incorporation or Organization) | (I.R.S. Employer Identification No.) | |||
155 N. Wacker Drive, Suite 4000 | ||||
Chicago, IL | 60606 | |||
(Address of principal executive offices) | (Zip Code) |
(312) 784-6001 |
(Registrant’s telephone number, including area code) |
____________
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Trading symbol | Name of each exchange on which registered | ||
Class A Common Stock, $0.001 par value per share | RYAN | The New York Stock Exchange (NYSE) |
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 ☒
On July 27, 2026, the Registrant had 255,814,785 shares of common stock outstanding, consisting of 122,077,702 shares of Class A common stock,
$0.001 par value, and 133,737,083 shares of Class B common stock, $0.001 par value.
i
Forward-Looking Statements
This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of the Private Securities
Litigation Reform Act of 1995 that involve substantial risks and uncertainties. All statements, other than statements of
historical fact included in this Quarterly Report on Form 10-Q, are forward-looking statements. Forward-looking
statements give our current expectations relating to our financial condition, results of operations, plans, objectives, future
performance, and business. You can identify forward-looking statements by the fact that they do not relate strictly to
historical or current facts. These statements may include words such as “anticipate,” “estimate,” “expect,” “project,”
“plan,” “intend,” “believe,” “may,” “will,” “should,” “can have,” “likely,” and other words and terms of similar meaning in
connection with any discussion of the timing or nature of future operating or financial performance or other events. For
example, all statements we make relating to our estimated costs, expected benefits relating to our corporate restructuring
program, expenditures, cash flows, growth rates and financial results, any future dividends, our plans, and objectives for
future operations, growth or initiatives, strategies or the expected outcome or impact of pending or threatened litigation, are
forward-looking statements. All forward-looking statements are subject to risks and uncertainties that may cause actual
results to differ materially from those that we expected, including:
•our failure to successfully recruit and retain our senior management team, revenue producers, or other key
employees, and to successfully plan and prepare for the succession of our senior management team;
•the potential loss of our relationships with insurance carriers or our clients, failure to maintain good
relationships with insurance carriers or clients, becoming dependent upon a limited number of insurance
carriers or clients, or the failure to develop new insurance carrier and client relationships;
•errors in, or ineffectiveness of, our underwriting models and the risks presented to our reputation and
relationships with insurance carriers, retail brokers, and agents;
•failure to maintain, protect, and enhance our brand or prevent damage to our reputation;
•the unsatisfactory evaluation of potential acquisitions or the failure to successfully integrate acquired
businesses and/or introduce new products, lines of business, and/or markets;
•our inability to successfully recover upon experiencing a disaster or other interruption in business
continuity;
•the impact of third parties that perform key functions of our business operations acting in ways that harm
our business;
•failure to maintain the valuable aspects of our Company’s culture;
•the cyclicality of, and the economic conditions in, the markets in which we operate and conditions that
result in reduced insurer capacity or a migration of business away from the E&S market and into the
Admitted market;
•a reduction in insurer capacity to adequately and appropriately underwrite risk and provide coverage;
•our international operations expose us to various international risks, including required compliance with
evolving legal and regulatory obligations, that are different, and at times more burdensome, than those set
forth in the United States;
•changes in interest rates and deterioration of credit quality could reduce the value of our cash balances or
interest income;
•significant competitive pressures in each of our businesses;
•decreases in premiums or commission rates set by insurers, or actions by insurers seeking repayment of
commissions;
•the impact if the contracts that govern our MGAs or MGUs are terminated or changed;
•a decrease in the amount of supplemental or contingent commissions we receive;
•our inability to collect our receivables;
•disintermediation within the insurance industry and shifts away from traditional insurance markets;
•impairment of goodwill and intangibles;
•the challenges with properly assessing, adapting to, and managing the adoption and use of artificial
intelligence and other evolving technologies;
ii
•the inability to maintain strong growth and generate sufficient revenue to maintain profitability;
•the loss of clients or business as a result of consolidation within the retail insurance brokerage industry;
•the inability to achieve the intended results of our restructuring program;
•significant investment in our growth strategy and whether expectation of internal efficiencies are realized;
•the unavailability or inaccuracy of our clients’ and third parties’ data for pricing and underwriting insurance
policies;
•the competitiveness and cyclicality of the reinsurance industry;
•the occurrence of natural or man-made disasters;
•the impact on our operations and financial condition from the effects of a pandemic or the outbreak of a
contagious disease and resulting governmental and societal responses;
•the economic and political conditions of the countries and regions in which we operate;
•the failure, or take-over by the FDIC, of one of the financial institutions that we use;
•our inability to respond quickly to operational or financial problems or promote the desired level of
cooperation and interaction among our offices;
•our international operations expose us to various international risks, including exchange rate fluctuations;
•changing expectations over corporate responsibility and stakeholder interests;
•the impact of breaches in security that cause significant system or network disruption or business
interruption;
•the impact of improper disclosure of confidential, personal, or proprietary data, misuse of information by
employees or counterparties, or as a result of cyber incidents and cyberattacks;
•our inability to gain internal efficiencies through the application of technology, effectively apply
technology in driving value for our clients, or the failure of technology and automated systems to function
or perform as expected;
•the impact of infringement, misappropriation, or dilution of our intellectual property;
•the impact of the failure to protect our intellectual property rights, or allegations that we have infringed on
the intellectual property rights of others;
•the impact of evolving governmental regulations, legal proceedings, and governmental inquiries related to
our business;
•being subject to E&O claims, as well as other contingencies and legal proceedings;
•our handling of client funds and surplus lines taxes that exposes us to complex fiduciary regulations;
•changes in tax laws or regulations;
•decreased commission revenues due to proposed tort reform legislation;
•the impact of regulations affecting insurance carriers;
•our outstanding debt potentially adversely affecting our financial flexibility and subjecting us to contractual
restrictions and limitations that could significantly affect our ability to operate and manage our business;
•not being able to generate sufficient cash flow to service all of our indebtedness and being forced to take
other actions to satisfy our obligations under such indebtedness;
•being affected by further changes in the U.S. based credit markets;
•changes in our credit ratings;
•risks related to the payments required by our Tax Receivable Agreement;
•risks relating to our organizational structure that could result in conflicts of interests between the LLC
Unitholders, the Ryan Parties, and the holders of our Class A common stock;
•risks relating to our share repurchase program; and
iii
•other factors disclosed in the section entitled “Risk Factors” in our Annual Report on Form 10-K and our
Quarterly Reports on Form 10-Q.
We derive many of our forward-looking statements from our operating budgets and forecasts that are based on many
detailed assumptions. While we believe that our assumptions are reasonable, we caution that it is very difficult to predict
the impact of known factors, and it is impossible for us to anticipate all factors that could affect our actual results.
Important factors that could cause actual results to differ materially from our expectations, or cautionary statements, are
disclosed under the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition
and Results of Operations” in this Quarterly Report on Form 10-Q and under the Section entitled “Risk Factors” in the
Company’s Annual Report on Form 10-K for the year ended December 31, 2025. All written and oral forward-looking
statements attributable to us, or persons acting on our behalf, are expressly qualified in their entirety by these cautionary
statements as well as other cautionary statements that are made from time to time in our filings with the SEC and other
public communications. You should evaluate all forward-looking statements made in this Quarterly Report on Form 10-Q
in the context of these risks and uncertainties.
In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject.
These statements are based upon information available to us as of the date of this Quarterly Report on Form 10-Q, and
while we believe such information forms a reasonable basis for such statements, such information may be limited or
incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review
of, all potentially available relevant information. These statements are inherently uncertain and investors are cautioned not
to unduly rely upon these statements.
We caution you that the important factors referenced above may not contain all of the factors that are important to you. In
addition, we cannot assure you that we will realize the results or developments we expect or anticipate or, even if
substantially realized, that they will result in the consequences or affect us or our operations in the way we expect. The
forward-looking statements included in this Quarterly Report on Form 10-Q are made only as of the date hereof. We
undertake no obligation to update or revise any forward-looking statement as a result of new information, future events or
otherwise, except as otherwise required by law.
Commonly Used Defined Terms
As used in this Quarterly Report on Form 10-Q, unless the context indicates or otherwise requires, the following terms
have the following meanings:
•“we”, “us”, “our”, the “Company”, “Ryan Specialty”, and similar references refer to Ryan Specialty Holdings,
Inc., and, unless otherwise stated, all of its subsidiaries, including the LLC.
•“2030 Senior Secured Notes”: The 4.375% senior secured notes due 2030 issued under an Indenture dated
February 3, 2022.
•“2032 Senior Secured Notes”: The 5.875% senior secured notes due 2032 issued under an Indenture dated
September 19, 2024, as supplemented on December 9, 2024.
•“Adjusted Term SOFR”: The interest rate per annum based on SOFR, without any credit spread adjustment,
subject to a 0 basis point floor.
•“Admitted”: The insurance market comprising insurance carriers licensed to write business on an “admitted”
basis by the insurance commissioner of the state in which the risk is located. Insurance rates and forms in this
market are highly regulated by each state and coverages are largely uniform.
•“Binding Authority”: Our Binding Authority Specialty receives submissions for insurance directly from retail
brokers, evaluates price and makes underwriting decisions regarding these submissions based on narrowly
prescribed guidelines provided by carriers, and binds and issues policies on behalf of insurance carriers who
retain the insurance underwriting risk.
•“Board” or “Board of Directors”: The board of directors of Ryan Specialty.
•“Class C Incentive Units”: Class C common incentive units, initially of the LLC on and prior to September
30, 2021, and then subsequently of New LLC, that are exchangeable into LLC Common Units.
•“Credit Agreement”: The credit agreement dated September 1, 2020, as amended, among Ryan Specialty,
LLC and JPMorgan Chase Bank, N.A., as administrative agent, and the other lenders party thereto.
iv
•“Credit Facility”: The Term Loan and the Revolving Credit Facility.
•“E&O”: Errors and omissions.
•“E&S”: Excess and surplus lines. In this insurance market, insurance carriers are licensed on a “non-
admitted” basis. The excess and surplus lines market often offers carriers more flexibility in terms,
conditions, and rates relative to the Admitted market.
•“Exchange Act”: Securities Exchange Act of 1934, as amended.
•“IPO”: Initial public offering.
•“LLC”: Ryan Specialty, LLC, together with its parent New LLC, and their subsidiaries.
•“LLC Common Units”: Non-voting common interest units initially of the LLC on and prior to September 30,
2021, and then subsequently of New LLC or LLC, as the context requires.
•“LLC Operating Agreement”: The Eighth Amended and Restated Limited Liability Company Agreement of
the LLC, as amended.
•“LLC Units”: Class A common units and Class B common units of the LLC prior to the Organizational
Transactions.
•“LLC Unitholders”: Holders of the LLC Units or the LLC Common Units, as the context requires.
•“MGA”: Managing general agent.
•“MGU”: Managing general underwriter.
•“New LLC”: New Ryan Specialty, LLC is a Delaware limited liability company and a direct subsidiary of
Ryan Specialty Holdings, Inc.
•“New LLC Operating Agreement”: The Third Amended and Restated Limited Liability Company Agreement
of New LLC, as amended.
•“Organizational Transactions”: The series of organizational transactions completed by the Company in
connection with the IPO, as described in Note 1 to the consolidated audited financial statements contained in
the Form 10-K filed with the SEC on March 16, 2022.
•“Revolving Credit Facility”: The $1,400 million revolving credit facility under the Credit Agreement.
•“Ryan Parties”: Patrick G. Ryan and certain members of his family and various entities and trusts over which
Patrick G. Ryan and his family exercise control.
•“SEC”: The Securities and Exchange Commission.
•“Senior Secured Notes”: The 2030 Senior Secured Notes and the 2032 Senior Secured Notes.
•“Specialty”: One of the three Ryan Specialty primary distribution channels, which include Wholesale
Brokerage, Binding Authority, and Underwriting Management.
•“Stock Option”: A non-qualified stock option award that gives the grantee the option to buy a specified
number of shares of Class A common stock at the grant date price.
•“Tax Receivable Agreement” or “TRA”: The tax receivable agreement entered into in connection with the
IPO.
•“Term Loan”: The $1,700 million in aggregate principal amount senior secured Term Loan B under the Credit
Agreement.
•“U.S. GAAP”: Accounting principles generally accepted in the United States of America.
•“Underwriting Management”: Our Underwriting Management Specialty administers a number of MGUs,
MGAs, and programs that offer commercial and personal insurance for specific product lines or industry
v
classes. Underwriters act with delegated underwriting authority based on varying degrees of prescribed
guidelines as provided by carriers, quoting, binding, and issuing policies on behalf of Ryan Specialty’s carrier
trading partners which retain the insurance underwriting risk.
•“Wholesale Brokerage”: Our Wholesale Brokerage Specialty distributes a wide range and diversified mix of
specialty property, casualty, professional lines, personal lines, and workers’ compensation insurance products,
as a broker between the carriers and retail brokerage firms.
1
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
Ryan Specialty Holdings, Inc.
Consolidated Statements of Income (Unaudited)
(In thousands, except share and per share data)
See accompanying Notes to the Consolidated Financial Statements (Unaudited)
2
Ryan Specialty Holdings, Inc.
Consolidated Statements of Comprehensive Income (Unaudited)
(In thousands)
See accompanying Notes to the Consolidated Financial Statements (Unaudited)
3
Ryan Specialty Holdings, Inc.
Consolidated Balance Sheets (Unaudited)
(In thousands, except share and per share data)
See accompanying Notes to the Consolidated Financial Statements (Unaudited)
4
Ryan Specialty Holdings, Inc.
Consolidated Statements of Cash Flows (Unaudited)
(In thousands)
Six Months Ended June 30, | ||||
2026 | 2025 | |||
CASH FLOWS FROM OPERATING ACTIVITIES | ||||
Net income | $148,978 | $120,316 | ||
Adjustments to reconcile net income to cash flows provided by operating activities: | ||||
Income from equity method investments | (12,570) | (10,093) | ||
Amortization | 129,727 | 134,653 | ||
Depreciation | 8,195 | 5,527 | ||
Prepaid and deferred compensation expense | 18,358 | 23,418 | ||
Non-cash equity-based compensation | 38,740 | 39,798 | ||
Amortization of deferred debt issuance costs | 4,856 | 4,760 | ||
Amortization of interest rate cap premium | — | 3,477 | ||
Deferred income tax expense | 20,285 | 9,502 | ||
Deferred income tax expense from common control reorganization | — | 47,978 | ||
Loss on Tax Receivable Agreement | 380 | 356 | ||
Impairment of internally-developed software | 11,982 | — | ||
Changes in operating assets and liabilities, net of acquisitions: | ||||
Commissions and fees receivable – net | (210,425) | (98,353) | ||
Accrued interest liability | 358 | 9,771 | ||
Other current and non-current assets | 21,402 | 36,646 | ||
Other current and non-current liabilities | (54,648) | (116,996) | ||
Total cash flows provided by operating activities | $125,618 | $210,760 | ||
CASH FLOWS FROM INVESTING ACTIVITIES | ||||
Business combinations – net of cash acquired and cash held in a fiduciary capacity | — | (565,133) | ||
Capital expenditures | (30,432) | (36,546) | ||
Equity method investment in VSIC | — | (16,637) | ||
Asset acquisitions | (1,556) | (664) | ||
Total cash flows used in investing activities | $(31,988) | $(618,980) | ||
CASH FLOWS FROM FINANCING ACTIVITIES | ||||
Borrowings on Revolving Credit Facility | 895,574 | 680,536 | ||
Repayments on Revolving Credit Facility | (610,882) | (492,788) | ||
Debt issuance costs paid | — | (2,889) | ||
Repayment of term debt | (8,500) | (8,500) | ||
Receipt of contingently returnable consideration | 3,140 | 1,927 | ||
Payment of contingent consideration | (21,960) | (29,252) | ||
Tax distributions to non-controlling LLC Unitholders | (17,953) | (34,814) | ||
Receipt of taxes related to net share settlement of equity awards | 7,589 | 12,791 | ||
Taxes paid related to net share settlement of equity awards | (7,322) | (14,688) | ||
Class A common stock dividends and Dividend Equivalents paid | (33,741) | (30,510) | ||
Distributions and Declared Distributions paid to non-controlling LLC Unitholders | (16,153) | (13,580) | ||
Repurchases of Class A common stock | (300,182) | — | ||
Payments related to Ryan Re preferred units | — | (167) | ||
Net change in fiduciary liabilities | 200,640 | 166,304 | ||
Total cash flows provided by financing activities | $90,250 | $234,370 | ||
Effect of changes in foreign exchange rates on cash, cash equivalents, and cash and cash equivalents held in a fiduciary capacity | (5,465) | 11,807 | ||
NET CHANGE IN CASH, CASH EQUIVALENTS, AND CASH AND CASH EQUIVALENTS HELD IN A FIDUCIARY CAPACITY | $178,415 | $(162,043) | ||
CASH, CASH EQUIVALENTS, AND CASH AND CASH EQUIVALENTS HELD IN A FIDUCIARY CAPACITY —Beginning balance | 1,584,470 | 1,680,805 | ||
CASH, CASH EQUIVALENTS, AND CASH AND CASH EQUIVALENTS HELD IN A FIDUCIARY CAPACITY —Ending balance | $1,762,885 | $1,518,762 | ||
Reconciliation of cash, cash equivalents, and cash and cash equivalents held in a fiduciary capacity | ||||
Cash and cash equivalents | $140,119 | $172,589 | ||
Cash and cash equivalents held in a fiduciary capacity | 1,622,766 | 1,346,173 | ||
Total cash, cash equivalents, and cash and cash equivalents held in a fiduciary capacity | $1,762,885 | $1,518,762 | ||
See accompanying Notes to the Consolidated Financial Statements (Unaudited)
5
Ryan Specialty Holdings, Inc.
Consolidated Statements of Stockholders’ Equity (Unaudited)
(In thousands, except share data)
Class A Common Stock | Class B Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Income | Non-controlling Interests | Total Stockholders’ Equity | ||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||||
Balance at December 31, 2025 | 129,603,426 | $130 | 134,508,885 | $135 | $513,610 | $120,353 | $13,845 | $605,978 | $1,254,051 | |||||||||
Net income | — | — | — | — | — | 17,646 | — | 22,951 | 40,597 | |||||||||
Issuance of common stock | 103,661 | — | — | — | — | — | — | — | — | |||||||||
Exchange of LLC equity for common stock | 176,484 | — | (157,236) | (1) | 296 | — | — | (295) | — | |||||||||
Cash and common stock clawbacks related to vested equity awards | (34,041) | — | — | — | (341) | — | — | 187 | (154) | |||||||||
Repurchase and retirement of common stock | (982,073) | (1) | — | — | (20,870) | — | — | (19,434) | (40,305) | |||||||||
Class A common stock dividends and Dividend Equivalents | — | — | — | — | — | (17,471) | — | — | (17,471) | |||||||||
Distributions and Declared Distributions to non- controlling LLC Unitholders | — | — | — | — | — | — | — | (8,177) | (8,177) | |||||||||
Tax Receivable Agreement liability and deferred taxes arising from LLC interest ownership changes | — | — | — | — | (4,115) | — | — | (933) | (5,048) | |||||||||
Distributions declared for non-controlling interest holders’ tax | — | — | — | — | — | — | — | (11,046) | (11,046) | |||||||||
Change in share of equity method investments’ other comprehensive income | — | — | — | — | — | — | 215 | 303 | 518 | |||||||||
Foreign currency translation adjustments | — | — | — | — | — | — | (4,670) | (6,592) | (11,262) | |||||||||
Equity-based compensation | — | — | — | — | 17,441 | — | — | (90) | 17,351 | |||||||||
Balance at March 31, 2026 | 128,867,457 | $129 | 134,351,649 | $134 | $506,021 | $120,528 | $9,390 | $582,852 | $1,219,054 | |||||||||
Net income | — | — | — | — | — | 42,315 | — | 66,066 | 108,381 | |||||||||
Issuance of common stock | 474,024 | — | 6,130 | — | — | — | — | — | — | |||||||||
Exchange of LLC equity for common stock | 245,957 | — | (245,957) | — | 377 | — | — | (377) | — | |||||||||
Common stock clawbacks related to vested equity awards | (27,244) | — | — | — | (94) | — | — | — | (94) | |||||||||
Repurchase and retirement of common stock | (8,129,462) | (8) | — | — | (133,920) | — | — | (128,593) | (262,521) | |||||||||
Equity awards withheld for settlement of employee tax obligations | — | — | — | — | (73) | — | — | — | (73) | |||||||||
Class A common stock dividends and Dividend Equivalents | — | — | — | — | — | (17,510) | — | — | (17,510) | |||||||||
Distributions and Declared Distributions to non- controlling LLC Unitholders | — | — | — | — | — | — | — | (8,149) | (8,149) | |||||||||
Tax Receivable Agreement liability and deferred taxes arising from LLC interest ownership changes | — | — | — | — | (33,185) | — | — | — | (33,185) | |||||||||
Distributions declared for non-controlling interest holders’ tax | — | — | — | — | — | — | — | (7,329) | (7,329) | |||||||||
Change in share of equity method investments’ other comprehensive income | — | — | — | — | — | — | (744) | (1,110) | (1,854) | |||||||||
Foreign currency translation adjustments | — | — | — | — | — | — | (582) | (1,382) | (1,964) | |||||||||
Equity-based compensation | — | — | — | — | 16,636 | — | — | 4,753 | 21,389 | |||||||||
Balance at June 30, 2026 | 121,430,732 | $121 | 134,111,822 | $134 | $355,762 | $145,333 | $8,064 | $506,731 | $1,016,145 | |||||||||
See accompanying Notes to the Consolidated Financial Statements (Unaudited)
6
Ryan Specialty Holdings, Inc.
Consolidated Statements of Stockholders’ Equity (Unaudited)
(In thousands, except share data)
Class A Common Stock | Class B Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Non-controlling Interests | Total Stockholders’ Equity | ||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||||
Balance at December 31, 2024 | 125,411,089 | $125 | 136,456,313 | $136 | $506,258 | $122,939 | $(1,796) | $470,623 | $1,098,285 | |||||||||
Net income (loss) | — | — | — | — | — | (27,642) | — | 23,253 | (4,389) | |||||||||
Issuance of common stock | 81,137 | — | — | — | — | — | — | — | — | |||||||||
Exchange of LLC equity for common stock | 540,663 | 1 | (498,664) | — | 803 | — | — | (804) | — | |||||||||
Class A common stock dividends and Dividend Equivalents | — | — | — | — | — | (15,959) | — | — | (15,959) | |||||||||
Distributions and Declared Distributions to non- controlling LLC Unitholders | — | — | — | — | — | — | — | (6,925) | (6,925) | |||||||||
Tax Receivable Agreement liability and deferred taxes arising from LLC interest ownership changes | — | — | — | — | (68,593) | — | — | 29,746 | (38,847) | |||||||||
Distributions declared for non-controlling interest holders’ tax | — | — | — | — | — | — | — | (8,443) | (8,443) | |||||||||
Change in share of equity method investment’s other comprehensive loss | — | — | — | — | — | — | (1,315) | (1,594) | (2,909) | |||||||||
Loss on interest rate cap, net | — | — | — | — | — | — | (898) | (1,107) | (2,005) | |||||||||
Foreign currency translation adjustments | — | — | — | — | — | — | 8,481 | 10,151 | 18,632 | |||||||||
Equity-based compensation | — | — | — | — | 19,978 | — | — | (105) | 19,873 | |||||||||
Balance at March 31, 2025 | 126,032,889 | $126 | 135,957,649 | $136 | $458,446 | $79,338 | $4,472 | $514,795 | $1,057,313 | |||||||||
Net income | — | — | — | — | — | 51,976 | — | 72,729 | 124,705 | |||||||||
Issuance of common stock | 432,507 | — | 1,437 | — | — | — | — | — | — | |||||||||
Exchange of LLC equity for common stock | 643,992 | 1 | (550,817) | (1) | 1,112 | — | — | (1,112) | — | |||||||||
Forfeiture of common stock | (1,233) | — | — | — | — | — | — | — | — | |||||||||
Equity awards withheld for settlement of employee tax obligations | — | — | — | — | (214) | — | — | (450) | (664) | |||||||||
Class A common stock dividends and Dividend Equivalents | — | — | — | — | — | (15,962) | — | — | (15,962) | |||||||||
Distributions and Declared Distributions to non- controlling LLC Unitholders | — | — | — | — | — | — | — | (6,907) | (6,907) | |||||||||
Tax Receivable Agreement liability and deferred taxes arising from LLC interest ownership changes | — | — | — | — | 1,297 | — | — | — | 1,297 | |||||||||
Distributions declared for non-controlling interest holders’ tax | — | — | — | — | — | — | — | (25,905) | (25,905) | |||||||||
Change in share of equity method investments’ other comprehensive income | — | — | — | — | — | — | 776 | 799 | 1,575 | |||||||||
Loss on interest rate cap, net | — | — | — | — | — | — | (329) | (682) | (1,011) | |||||||||
Foreign currency translation adjustments | — | — | — | — | — | — | 10,436 | 17,347 | 27,783 | |||||||||
Equity-based compensation | — | — | — | — | 18,476 | — | — | 1,449 | 19,925 | |||||||||
Balance at June 30, 2025 | 127,108,155 | $127 | 135,408,269 | $135 | $479,117 | $115,352 | $15,355 | $572,063 | $1,182,149 | |||||||||
See accompanying Notes to the Consolidated Financial Statements (Unaudited)
7
Ryan Specialty Holdings, Inc.
Notes to the Consolidated Financial Statements (Unaudited)
(Tabular amounts presented in thousands, except share and per share data)
1. Basis of Presentation
Nature of Operations
Ryan Specialty Holdings, Inc. (the “Company”) is a service provider of specialty products and solutions for insurance
brokers, agents, and carriers. These services encompass distribution, underwriting, product development, administration,
and risk management by acting as a wholesale broker and a managing underwriter or a program administrator with
delegated authority from insurance carriers. The Company’s offerings cover a wide variety of sectors including
commercial, industrial, institutional, governmental, and personal through one operating segment, Ryan Specialty. With the
exception of the Company’s equity method investments, the Company does not take on any underwriting risk.
The Company is headquartered in Chicago, Illinois, and has operations in the United States, the United Kingdom, Europe,
Canada, India, and Singapore. The Company’s Class A common stock is traded on the New York Stock Exchange under
the ticker symbol “RYAN”.
Organization
Ryan Specialty Holdings, Inc. was formed as a Delaware corporation on March 5, 2021, for the purpose of completing an
IPO and to carry on the business of the LLC. New Ryan Specialty, LLC, or New LLC, was formed as a Delaware limited
liability company on April 20, 2021, for the purpose of becoming, subsequent to our IPO, an intermediate holding
company between Ryan Specialty Holdings, Inc. and the LLC. The Company is the sole managing member of New LLC.
New LLC is a holding company with its sole material asset being a controlling equity interest in the LLC. The Company
operates and controls the business and affairs of the LLC through New LLC and, through the LLC, conducts its business.
Accordingly, the Company consolidates the financial results of New LLC, and therefore the LLC, and reports the non-
controlling interests of New LLC’s Common Units on its consolidated financial statements. As the LLC is substantively
the same as New LLC, for the purpose of this document, we will refer to both New LLC and the LLC as the “LLC”. As of
June 30, 2026, the Company owned 47.5% of the outstanding LLC Common Units.
Basis of Presentation
The accompanying unaudited consolidated interim financial statements and notes thereto have been prepared in accordance
with U.S. GAAP. Certain information and disclosures normally included in the financial statements prepared in accordance
with U.S. GAAP have been omitted pursuant to the rules and regulations of the SEC for interim financial information.
These consolidated interim financial statements should be read in conjunction with the audited consolidated financial
statements and notes thereto included in the Company’s Annual Report on Form 10-K filed with the SEC on February 13,
2026. Interim results are not necessarily indicative of results for the full fiscal year due to seasonality and other factors.
In the opinion of management, the unaudited consolidated interim financial statements include all normal recurring
adjustments necessary to present fairly the Company’s consolidated financial position, results of operations, and cash flows
for all periods presented.
Principles of Consolidation
The unaudited consolidated interim financial statements include the accounts of the Company and its subsidiaries that it
controls due to ownership of a majority voting interest or pursuant to variable interest entity (“VIE”) accounting. All
intercompany transactions and balances have been eliminated in consolidation.
The Company, through its intermediate holding company New LLC, owns a minority economic interest in, and operates
and controls the businesses and affairs of, the LLC. The LLC is a VIE of the Company and the Company is the primary
beneficiary of the LLC as the Company has both the power to direct the activities that most significantly impact the LLC’s
economic performance and has the obligation to absorb losses of, and receive benefits from, the LLC, which could be
significant to the Company. Accordingly, the Company has prepared these consolidated financial statements in accordance
with Accounting Standards Codification (“ASC”) 810, Consolidation (“ASC 810”). ASC 810 requires that if an entity is
the primary beneficiary of a VIE, the assets, liabilities, and results of operations of the VIE should be included in the
consolidated financial statements of such entity. The Company’s relationship with the LLC results in no recourse to the
general credit of the Company and the Company has no contractual requirement to provide financial support to the LLC.
The Company shares in the income and losses of the LLC in direct proportion to the Company’s ownership percentage.
8
Use of Estimates
The preparation of the unaudited consolidated interim financial statements and notes thereto requires management to make
estimates, judgments, and assumptions that affect the amounts reported in the unaudited consolidated interim financial
statements and the notes thereto. Such estimates and assumptions could change in the future as circumstances change or
more information becomes available, which could affect the amounts reported and disclosed herein.
Significant Accounting Policies
There have been no material changes, except as noted below, in the Company’s significant accounting policies from those
that were disclosed for the year ended December 31, 2025, in the Company’s Annual Report on Form 10-K filed with the
SEC on February 13, 2026.
Share Repurchases and Retirements
Class A common shares repurchased pursuant to the Company’s share repurchase program are recognized at cost, which
includes broker commissions and excise taxes. Repurchased shares are subsequently retired and the cost of the repurchased
shares in excess of par value is recognized as a reduction of additional paid-in capital.
Recently Issued Accounting Pronouncements
New Accounting Pronouncement Recently Adopted
In December 2025, the FASB issued ASU 2025-11 Interim Reporting (Topic 270) — Narrow-Scope Improvements, which
includes amendments that clarify when the interim reporting guidance is applicable, outlines the interim disclosures
required under this guidance and all other ASC topics, and establishes a disclosure principle that requires an entity to
disclose material events that have occurred since the last annual reporting period. This ASU is effective for interim
reporting periods within annual reporting periods beginning after December 15, 2027, with early adoption permitted. The
Company early adopted this ASU prospectively on January 1, 2026, with no material impact to its consolidated financial
statements or disclosures.
In December 2025, the FASB issued ASU 2025-12 Codification Improvements, which includes amendments that provide
clarification, correct technical errors, and make minor improvements with the intent to make the Accounting Standard
Codification easier to understand and apply. This ASU is effective for annual reporting periods beginning after December
15, 2026, and interim periods within those annual reporting periods, with early adoption permitted. The Company early
adopted this ASU prospectively on January 1, 2026, with no material impact to its consolidated financial statements or
disclosures.
Recently Issued Accounting Pronouncements Not Yet Adopted
In November 2024, the FASB issued ASU 2024-03 Income Statement — Reporting Comprehensive Income — Expense
Disaggregation Disclosures (Subtopic 220-40) — Disaggregation of Income Statement Expenses, which requires the
disaggregation of certain expense captions into specified categories in disclosures within the footnotes to the financial
statements. This ASU is effective for annual reporting periods beginning after December 15, 2026, and interim periods
within fiscal years beginning after December 15, 2027, with early adoption permitted. The amendments in this ASU may
be applied either prospectively or retrospectively. The Company is currently evaluating the impact of adopting this ASU on
its disclosures.
In September 2025, the FASB issued ASU 2025-06 Intangibles — Goodwill and Other — Internal-Use Software (Subtopic
350-40) — Targeted Improvements to the Accounting for Internal-Use Software, which removes all references to
prescriptive and sequential software development stages and instead requires entities to begin capitalizing costs once
management has authorized and committed to funding the software, and it is probable that the project will be completed
and used to perform its intended functions. Significant uncertainty regarding development activities must be assessed when
evaluating if a project is probable to be completed. Additionally, the ASU clarifies certain disclosure requirements for
capitalized internal-use software costs. This ASU is effective for annual reporting periods beginning after December 15,
2027, and interim reporting periods within those annual reporting periods, with early adoption permitted. The amendments
in this ASU may be applied prospectively, using a modified transition approach, or retrospectively. The Company is
currently evaluating the impact of adopting this ASU on its consolidated financial statements and disclosures.
9
2. Revenue from Contracts with Customers
Disaggregation of Revenue
The following table summarizes revenue from contracts with customers by Specialty:
Three Months Ended June 30, | Six Months Ended June 30, | |||||||
2026 | 2025 | 2026 | 2025 | |||||
Wholesale Brokerage | $498,802 | $477,165 | $876,598 | $837,953 | ||||
Binding Authority | 100,170 | 94,524 | 210,170 | 196,474 | ||||
Underwriting Management | 303,756 | 269,168 | 598,863 | 482,558 | ||||
Total Net commissions and fees | $902,728 | $840,857 | $1,685,631 | $1,516,985 | ||||
Contract Balances
Contract assets, which arise primarily from the Company’s supplemental and contingent commission arrangements,
medical stop loss business, and multi-year structured solutions business, are included within Commissions and fees
receivable – net on the Consolidated Balance Sheets. The contract assets balance was $87.0 million and $65.4 million as of
June 30, 2026 and December 31, 2025, respectively. The contract liability balance related to deferred revenue, which is
included within Accounts payable and accrued liabilities on the Consolidated Balance Sheets, was $7.3 million and $10.0
million as of June 30, 2026 and December 31, 2025, respectively. During the three and six months ended June 30, 2026,
$4.0 million and $8.1 million, respectively, of the contract liabilities outstanding as of December 31, 2025, were
recognized as revenue.
3. Mergers and Acquisitions
There were no material acquisitions completed during the six months ended June 30, 2026.
2025 Acquisitions
On February 3, 2025, the Company completed the acquisition of Velocity Risk Underwriters, LLC (“Velocity”), an MGU
specializing in first-party insurance coverage for catastrophe exposed properties, headquartered in Nashville, Tennessee,
for cash consideration of $549.6 million and contingent consideration of $19.6 million. Measurement period adjustments
related to the initial valuation of contingent consideration of $1.5 million, Other current assets of $1.5 million, and net
working capital of $0.9 million were recognized as a net $0.9 million increase in Goodwill on the Consolidated Balance
Sheets as of December 31, 2025.
On May 1, 2025, the Company completed the acquisition of certain assets of USQRisk Holdings, LLC, a company based in
New York, New York, and London, England, that underwrites, structures, prices, and places specialty insurance for
corporate clients seeking bespoke, multi-year risk solutions, for cash consideration of $28.9 million and contingent
consideration of $23.8 million. A measurement period adjustment related to net working capital of $0.2 million was
recognized as an increase in Goodwill on the Consolidated Balance Sheets as of December 31, 2025.
On May 16, 2025, the Company completed the acquisition of 360° Underwriting, an MGU specializing in commercial
construction, based in Dublin and Galway, Ireland, for cash consideration of $28.2 million and contingent consideration of
$0.6 million.
On July 1, 2025, the Company completed the acquisition of certain assets of J.M. Wilson Corporation, a binding authority
and surplus lines broker specializing in transportation insurance, headquartered in Portage, Michigan, for $67.2 million of
cash consideration and $20.4 million of LLC Common Units. Measurement period adjustments related to Commissions and
fees receivable – net of $0.8 million, the initial valuation of Customer relationships of $0.4 million, and net working capital
of $0.6 million were recognized as a net $0.6 million increase in Goodwill on the Consolidated Balance Sheets as of
December 31, 2025.
On December 1, 2025, the Company completed the acquisition of Stewart Specialty Risk Underwriting Ltd., an MGU
specializing in underwriting large-account, high-hazard property and casualty solutions, based in Toronto, Canada, for
$124.3 million of cash consideration and $8.1 million of the Company’s Class A common stock. During the six months
ended June 30, 2026, a measurement period adjustment related to net working capital of $1.3 million was recognized as an
increase in Goodwill on the Consolidated Balance Sheets.
10
The Company recognized acquisition-related expenses, which include advisory, legal, accounting, valuation, and diligence-
related costs, for the acquisitions completed during the six months ended June 30, 2025, of $3.3 million and $9.5 million
during the three and six months ended June 30, 2025, respectively, in General and administrative expense on the
Consolidated Statements of Income. The Company recognized aggregate revenue of $41.7 million and $55.4 million
related to these acquisitions from their respective acquisition dates during the three and six months ended June 30, 2025,
respectively. Estimated tax deductible goodwill of $14.4 million was generated as a result of these acquisitions.
Estimates and assumptions used in the acquisition valuations are subject to change within the measurement period up to
one year from each acquisition date.
Unaudited Pro Forma Financial Information
The following unaudited pro forma financial information presents the combined results of operations of the Company as if
the acquisitions completed during the six months ended June 30, 2025, occurred on January 1, 2024. The unaudited pro
forma financial information is presented for informational purposes only and is not indicative of the results of operations
that would have been achieved if the acquisitions had taken place on the date indicated or of results that may occur in the
future.
Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | |||
Total revenue | $857,077 | $1,560,684 | ||
Net income | 133,289 | 180,466 |
The unaudited pro forma financial information includes adjustments related to incremental amortization expense on
acquired intangible assets, transaction costs, incremental income tax expense related to the CCR (as defined in Note 16,
Income Taxes), and the consequential tax effects of the pro forma adjustments.
Contingent Consideration
Total consideration for certain acquisitions includes contingent consideration or contingently returnable consideration,
which is generally based on the EBITDA or revenue of the acquired business following a defined period after purchase.
Further information regarding the fair value measurements of contingent consideration and contingently returnable
consideration is detailed in Note 13, Fair Value Measurements. The Company recognizes income or loss for the changes in
fair value of estimated contingent consideration and contingently returnable consideration within Change in contingent
consideration, and recognizes accretion of the discount on these assets or liabilities within Interest expense, net, on the
Consolidated Statements of Income. The table below summarizes the amounts recognized:
Three Months Ended June 30, | Six Months Ended June 30, | |||||||
2026 | 2025 | 2026 | 2025 | |||||
Change in contingent consideration | $17,551 | $(759) | $44,845 | $(14,801) | ||||
Interest expense, net | 2,265 | 1,655 | 4,581 | 3,987 | ||||
Total | $19,816 | $896 | $49,426 | $(10,814) | ||||
As of June 30, 2026, the aggregate amount of maximum consideration related to acquisitions was $545.2 million of
contingent consideration and $6.6 million of contingently returnable consideration.
11
4. Restructuring
During the first quarter of 2026, the Company initiated the Empower program to streamline the Company’s brokerage,
binding, and underwriting operations, optimize scale, accelerate data and technology strategies, and enhance efficiencies
across all of the Company’s Specialties. The restructuring plan is expected to incur total restructuring costs of $160.0
million, including $115.0 million related to business platform optimization and $45.0 million related to compensation and
benefits, through December 31, 2028, and to generate annual savings of approximately $80.0 million in 2029. Business
platform optimization includes expenses related to professional services, technology and data initiatives, license fees, and
third-party contractors, as well as non-cash expenses associated with the impairment of internally-developed software.
Compensation and benefits includes severance as well as employment costs for services rendered between the notification
and termination dates and other termination payments. The following table presents the restructuring expense incurred:
For the three and six months ended June 30, 2026, the Company recognized restructuring expenses of $11.6 million and
$13.6 million, respectively, including contractor costs, in Compensation and benefits, and $21.7 million and $24.3 million,
respectively, in General and administrative expense on the Consolidated Statements of Income. General and administrative
expense recognized during the three and six months ended June 30, 2026, included $12.0 million related to the impairment
of internally-developed software.
The following table presents a summary of changes in the restructuring liability:
Business Platform Optimization | Compensation and Benefits | Total | ||||
Balance at January 1, 2026 | $— | $— | $— | |||
Charges | 43,209 | 7,855 | 51,064 | |||
Payments | (18,200) | (3,600) | (21,800) | |||
Non-cash adjustments | (11,982) | — | (11,982) | |||
Balance at June 30, 2026 | $13,027 | $4,255 | $17,282 |
Charges in the table above include both costs expensed and capitalized during the period. As of June 30, 2026, $6.3 million
of the restructuring liability was included in Accounts payable and accrued liabilities, and $10.3 million and $0.7 million
was included in Current Accrued compensation and Non-current Accrued compensation, respectively, on the Consolidated
Balance Sheets.
5. Receivables and Other Current Assets
Receivables
The Company had receivables of $697.6 million and $489.0 million outstanding as of June 30, 2026 and December 31,
2025, respectively, which were recognized within Commissions and fees receivable – net on the Consolidated Balance
Sheets. Commission and fees receivable is net of an allowance for expected credit losses. The Company’s allowance for
expected credit losses is based on a combination of factors, including evaluation of historical write-offs, current economic
conditions, aging of balances, and other qualitative and quantitative analyses.
The following table provides a summary of changes in the Company’s allowance for expected credit losses:
Three Months Ended June 30, | Six Months Ended June 30, | |||||||
2026 | 2025 | 2026 | 2025 | |||||
Balance at beginning of period | $4,413 | $3,394 | $4,095 | $3,018 | ||||
Write-offs | (502) | (1,076) | (2,085) | (2,211) | ||||
Increase in provision | 702 | 1,388 | 2,603 | 2,899 | ||||
Balance at end of period | $4,613 | $3,706 | $4,613 | $3,706 | ||||
12
Other Current Assets
Major classes of other current assets consisted of the following:
June 30, 2026 | December 31, 2025 | |||
Prepaid expenses | $56,636 | $62,995 | ||
Other current receivables | 23,122 | 37,442 | ||
Total Other current assets | $79,758 | $100,437 |
Other current receivables contain service receivables from Geneva Re, Ltd (“Geneva Re”) and Velocity Specialty
Insurance Company (“VSIC”). See Note 15, Related Parties, for further information regarding related parties.
6. Leases
The Company has operating leases with various terms through February 2038, primarily for office space and office
equipment. The following table provides additional information about the Company’s leases:
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||
2026 | 2025 | 2026 | 2025 | ||||||
Lease costs | |||||||||
Operating lease costs | $9,126 | $8,555 | $17,829 | $16,860 | |||||
Short-term lease costs | |||||||||
Operating lease costs | 168 | 548 | 369 | 1,054 | |||||
Sublease income | (140) | (157) | (278) | (265) | |||||
Lease costs – net | $9,154 | $8,946 | $17,920 | $17,649 | |||||
Cash paid for amounts included in the measurement of lease liabilities | |||||||||
Operating cash flows used for operating leases | $19,571 | $16,876 | |||||||
Non-cash related activities | |||||||||
Right-of-use assets obtained in exchange for new operating lease liabilities | 8,976 | 11,985 | |||||||
Amortization of right-of-use assets for operating leases | 13,018 | 12,072 | |||||||
Weighted-average discount rate (percent) | |||||||||
Operating leases | 5.5 % | 5.4 % | |||||||
Weighted-average remaining lease term (years) | |||||||||
Operating leases | 6.4 | 7.2 | |||||||
13
7. Debt
Substantially all of the Company’s debt is carried at outstanding principal balance, less debt issuance costs and any
unamortized discount. The following table is a summary of the Company’s outstanding debt:
June 30, 2026 | December 31, 2025 | |||
Term debt | ||||
7-year term loan facility, periodic interest and quarterly principal payments, Adjusted Term SOFR + 2.00%, matures September 13, 2031 | $1,653,195 | $1,659,629 | ||
Senior secured notes | ||||
8-year senior secured notes, semi-annual interest payments, 4.38%, mature February 1, 2030 | 403,196 | 402,677 | ||
8-year senior secured notes, semi-annual interest payments, 5.88%, mature August 1, 2032 | 1,211,125 | 1,209,908 | ||
Revolving debt | ||||
5-year revolving loan facility, periodic interest payments, Adjusted Term SOFR + up to 2.50%, plus commitment fees of 0.25%-0.50%, matures July 30, 2029 | 358,345 | 74,062 | ||
Premium financing notes | ||||
Commercial notes, periodic interest and principal payments, 4.75%, expire March 15, 2027 | 563 | — | ||
Commercial notes, periodic interest and principal payments, 4.75%, expire May 15, 2027 | 6,731 | — | ||
Commercial notes, periodic interest and principal payments, 5.25%, expired May 1, 2026 | — | 2,519 | ||
Commercial notes, periodic interest and principal payments, 5.25%, expired June 1, 2026 | — | 499 | ||
Commercial notes, periodic interest and principal payments, 5.25%, expired June 21, 2026 | — | 2,355 | ||
Total debt | $3,633,155 | $3,351,649 | ||
Less: Short-term debt and current portion of long-term debt | (62,466) | (60,187) | ||
Long-term debt | $3,570,689 | $3,291,462 |
Term Loan
As of June 30, 2026, $1,674.5 million of the Term Loan principal was outstanding, $0.3 million of interest was accrued,
and the related unamortized deferred issuance costs were $21.6 million. As of December 31, 2025, $1,683.0 million of the
principal was outstanding, $0.3 million of interest was accrued, and the related unamortized deferred issuance costs were
$23.6 million.
Revolving Credit Facility
The Revolving Credit Facility had a borrowing capacity of $1,400.0 million as of June 30, 2026 and December 31, 2025.
Due to the nature of the instrument, the deferred issuance costs related to the facility of $6.5 million and $7.5 million as of
June 30, 2026 and December 31, 2025, respectively, were included in Other non-current assets on the Consolidated
Balance Sheets. The commitments available to be borrowed under the Revolving Credit Facility were $1,042.9 million as
of June 30, 2026, as the facility was drawn on by $357.1 million. The commitments available to be borrowed under the
Revolving Credit Facility were $1,326.8 million as of December 31, 2025, as the facility was drawn on by $73.2 million.
The Company pays a commitment fee on undrawn amounts under the facility of 0.25%-0.50%. As of June 30, 2026 and
December 31, 2025, the Company accrued $0.6 million and $0.8 million, respectively, of unpaid commitment fees related
to the Revolving Credit Facility in Short-term debt and current portion of long-term debt on the Consolidated Balance
Sheets. As of June 30, 2026 and December 31, 2025, accrued interest on the facility was $0.7 million and $0.1 million,
respectively.
14
Senior Secured Notes due 2030
In February 2022, the LLC issued $400.0 million of Senior Secured Notes. As of June 30, 2026 and December 31, 2025,
accrued interest on the notes was $7.3 million, and the related unamortized deferred issuance costs were $4.1 million and
$4.6 million, respectively.
Senior Secured Notes due 2032
In September 2024, the LLC issued $600.0 million of Senior Secured Notes at par. In December 2024, the LLC issued an
additional $600.0 million of Senior Secured Notes at a price of 99.5% of their face value plus accrued interest from
September 19, 2024. The notes issued in December 2024 were issued as additional notes under the same indenture as the
notes that were issued in September 2024 and, as such, form a single series and trade interchangeably with the previously
issued senior secured notes due 2032. As of June 30, 2026 and December 31, 2025, accrued interest on the notes was $29.4
million, and the related unamortized deferred issuance costs, including discount, were $18.3 million and $19.5 million,
respectively.
8. Stockholders’ Equity
Ryan Specialty’s amended and restated certificate of incorporation authorizes the issuance of up to 1,000,000,000 shares of
Class A common stock, 1,000,000,000 shares of Class B common stock, and 500,000,000 shares of preferred stock, each
having a par value of $0.001 per share.
The New LLC Operating Agreement requires that the Company and the LLC at all times maintain a one-to-one ratio
between the number of shares of Class A common stock issued by the Company and the number of LLC Common Units
owned by the Company, except as otherwise determined by the Company.
Class A and Class B Common Stock
Each share of Class A common stock is entitled to one vote per share. Each share of Class B common stock is entitled to 10
votes per share but, upon the occurrence of certain events as set forth in the Company’s amended and restated certificate of
incorporation, or as of September 30, 2029, at the latest, each share will be entitled to one vote per share in the future. All
holders of Class A common stock and Class B common stock vote together as a single class except as otherwise required
by applicable law or our amended and restated certificate of incorporation. Holders of Class B common stock do not have
any right to receive dividends or distributions upon the liquidation or winding up of the Company.
In accordance with the New LLC Operating Agreement, the LLC Unitholders are entitled to exchange LLC Common Units
for shares of Class A common stock, or, at the Company’s election, for cash from a substantially concurrent public offering
or private sale (based on the price of our Class A common stock in such public offering or private sale). The LLC
Unitholders are also required to deliver to the Company an equivalent number of shares of Class B common stock to
effectuate such an exchange. Any shares of Class B common stock so delivered will be canceled. Shares of Class B
common stock are not issued for Class C Incentive Units that are exchanged for LLC Common Units as these LLC
Common Units are immediately exchanged for Class A common stock as discussed in Note 9, Equity-Based
Compensation.
Preferred Stock
There were no shares of preferred stock outstanding as of June 30, 2026 or December 31, 2025. Under the terms of the
amended and restated certificate of incorporation, the Board is authorized to direct the Company to issue shares of
preferred stock in one or more series without stockholder approval. The Board has the discretion to determine the rights,
preferences, privileges, and restrictions, including voting rights, dividend rights, conversion rights, redemption privileges,
and liquidation preferences, of each series of preferred stock.
Share Repurchase Program
On February 10, 2026, the Company’s Board of Directors approved a share repurchase program that authorizes the
Company to repurchase up to $300.0 million of its outstanding Class A common stock. On May 21, 2026, the Company’s
Board of Directors authorized a $300.0 million increase to the Company’s share repurchase program. Authorized amounts
exclude broker commissions. Share repurchases may be made from time to time on the open market, in privately negotiated
transactions, using Rule 10b5-1 trading plans, as accelerated share repurchases, or in any other manner that complies with
the applicable securities law. The timing of purchases and number of shares repurchased under the program will depend
upon a variety of factors including the Company’s stock price, trading volume, working capital or other liquidity
15
requirements, and market conditions. The Company is not obligated to purchase any shares under the program and the
program may be suspended or discontinued at any time without notice.
During the six months ended June 30, 2026, the Company repurchased and subsequently retired 9,111,535 shares of its
Class A common stock in open market transactions for an aggregate purchase price of $300.2 million, inclusive of broker
commissions and exclusive of excise taxes. As of June 30, 2026, $300.0 million remained available for repurchases under
the program.
Dividends
During the three months ended June 30, 2026, the Company’s Board of Directors declared a regular quarterly cash
dividend of $0.13 per share on the Company’s outstanding Class A common stock. During the six months ended June 30,
2026, $33.2 million of dividends were paid on Class A common stock.
Non-controlling Interests
The Company is the sole managing member of the LLC. As a result, the Company consolidates the LLC in its consolidated
financial statements, resulting in non-controlling interests related to the LLC Common Units not held by the Company. As
of June 30, 2026 and December 31, 2025, the Company owned 47.5% and 49.1%, respectively, of the economic interests in
the LLC, while the non-controlling interest holders owned the remaining 52.5% and 50.9%, respectively, of the economic
interests in the LLC.
Weighted-average ownership percentages for the applicable reporting periods are used to attribute net income (loss) and
other comprehensive income (loss) (“OCI”) to the Company and the non-controlling interest holders. The non-controlling
interest holders’ weighted-average ownership percentage was 51.9% and 51.8% for the three months ended June 30, 2026
and 2025, respectively, and 51.5% and 51.7% for the six months ended June 30, 2026 and 2025, respectively.
During the three months ended June 30, 2026, the Company declared a regular quarterly cash distribution of $0.06 per unit
on the LLC’s outstanding LLC Common Units. During the six months ended June 30, 2026, $16.1 million in distributions
were paid to the non-controlling interest holders of the LLC Common Units.
9. Equity-Based Compensation
The Ryan Specialty Holdings, Inc. 2021 Omnibus Incentive Plan (the “Omnibus Plan”) governs, among other things, the
types of awards the Company can grant to employees as equity-based compensation awards. The Omnibus Plan provides
for potential grants of the following awards: (i) stock options, (ii) stock appreciation rights, (iii) restricted stock awards,
(iv) performance awards, (v) other stock-based awards, (vi) other cash-based awards, and (vii) analogous equity awards
made in equity of the LLC.
IPO-Related Awards
As a result of the Organizational Transactions, pre-IPO holders of LLC Units that were granted as incentive awards, which
had historically been classified as equity and vested pro rata over five years, were required to exchange their LLC Units for
either Restricted Stock or Restricted Common Units. Additionally, Reload Options or Reload Class C Incentive Units were
issued to employees in order to protect against the dilution of their existing awards upon exchange to the new awards.
Separately, certain employees were granted one or more of the following new awards: (i) Restricted Stock Units (“RSUs”),
(ii) Staking Options, (iii) Restricted LLC Units (“RLUs”), or (iv) Staking Class C Incentive Units. The terms of these
awards are described below. All awards granted as part of the Organizational Transactions and the IPO are subject to non-
linear transfer restrictions for at least the five-year period following the IPO.
Incentive Awards
As part of the Company’s annual compensation process, the Company issues certain employees and directors equity-based
compensation awards (“Incentive Awards”). Additionally, the Company offers Incentive Awards to certain new hires.
These Incentive Awards typically take the form of (i) RSUs, (ii) RLUs, (iii) Stock Options, (iv) Class C Incentive Units,
(v) Performance Stock Units (“PSUs”), and (vi) Performance LLC Units (“PLUs”). The terms of these awards are
described below.
16
Restricted Stock Units (RSUs)
IPO RSUs
Related to the IPO, the Company granted RSUs to certain employees. The IPO RSUs vest either pro rata over 5 years from
the grant date or over 10 years from the grant date, with 10% vesting in each of years 3 through 9 and 30% vesting in year
10.
Incentive RSUs
Incentive RSUs vest either 100% 3 or 5 years from the grant date, pro rata over 5 years from the grant date, over 5 years
from the grant date, with one-third of the grant vesting in each of years 3, 4 and 5, or over 7 years from the grant date, with
20% vesting in each of years 3 through 7.
Upon vesting, RSUs automatically convert on a one-for-one basis into Class A common stock.
Six Months Ended June 30, 2026 | |||||||||
IPO RSUs | Incentive RSUs | ||||||||
Restricted Stock Units | Weighted Average Grant Date Fair Value | Restricted Stock Units | Weighted Average Grant Date Fair Value | ||||||
Unvested at beginning of period | 2,046,961 | $23.22 | 2,553,441 | $49.49 | |||||
Granted | — | — | 2,506,554 | 39.66 | |||||
Vested | (21,668) | 23.25 | (407,560) | 42.75 | |||||
Forfeited | (15,624) | 23.09 | (37,040) | 48.39 | |||||
Unvested at end of period | 2,009,669 | $23.23 | 4,615,395 | $44.76 | |||||
Stock Options
Reload and Staking Options
As part of the Organizational Transactions and IPO, certain employees were granted Reload Options or Staking Options
that entitle the award holder to future purchases of Class A common stock, on a one-for-one basis, at the IPO price of
$23.50. The Reload Options either vested 100% 3 years from the grant date or vest over 5 years from the grant date, with
one-third of the grant vesting in each of years 3, 4 and 5. In general, vested Reload Options are exercisable up to the tenth
anniversary of the grant date. The Staking Options vest over 10 years from the grant date, with 10% vesting in each of
years 3 through 9 and 30% vesting in year 10. Staking Options are exercisable up to one year after their vest date.
Incentive Options
Incentive Options entitle the award holder to future purchases of Class A common stock, on a one-for-one basis, at the
respective exercise prices. The Incentive Options vest either over 5 years from the grant date, with one-third of the grant
vesting in each of years 3, 4 and 5 or pro rata over 7 years from the grant date. In general, vested Incentive Options are
exercisable up to the tenth anniversary of the grant date.
Six Months Ended June 30, 2026 | |||||||||
Reload Options1 | Staking Options1 | Incentive Options | Incentive Options Weighted Average Exercise Price | ||||||
Outstanding at beginning of period | 3,393,326 | 66,667 | 271,247 | $44.34 | |||||
Granted | — | — | 1,787,446 | 29.66 | |||||
Exercised | (137,174) | (13,332) | (2,553) | 34.39 | |||||
Forfeited or expired | (34,932) | — | (1,215) | 34.39 | |||||
Outstanding at end of period | 3,221,220 | 53,335 | 2,054,925 | $31.59 | |||||
1 As the Reload and Staking Options were one-time grants at the IPO, the weighted-average exercise price for any
movements in these awards will perpetually be $23.50. As such, the values are not presented in the table above.
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The fair value of Incentive Options granted during the six months ended June 30, 2026, was determined using the Black-
Scholes option pricing model with the following assumptions:
The use of a valuation model for the Options requires management to make certain assumptions with respect to selected
model inputs. Expected volatility was calculated based on the observed volatility for comparable companies. The expected
time to maturity was based on the weighted-average vesting term and contractual term of the awards. The risk-free interest
rate was based on U.S. Treasury rates commensurate with the expected life of the award. The dividend yield was based on
the Company’s expected dividend rate.
As of June 30, 2026, there were 2,120,226 and 118,673 exercisable Reload and Incentive Options, respectively, and no
exercisable Staking Options. The aggregate intrinsic values and weighted-average remaining contractual terms of Stock
Options outstanding and exercisable as of June 30, 2026, were as follows:
Restricted LLC Units (RLUs)
IPO RLUs
Related to the IPO, the Company granted RLUs to certain employees that vest either pro rata over 5 years from the grant
date or over 10 years from the grant date, with 10% vesting in each of years 3 through 9 and 30% vesting in year 10.
Incentive RLUs
Incentive RLUs vest either 100% 3 years from the grant date, pro rata over 3 or 5 years from the grant date, or over 7 years
from the grant date, with 20% vesting in each of years 3 through 7.
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Upon vesting, RLUs convert on a one-for-one basis into either LLC Common Units or Class A common stock at the
election of the Company.
Six Months Ended June 30, 2026 | |||||||||
IPO RLUs | Incentive RLUs | ||||||||
Restricted LLC Units | Weighted Average Grant Date Fair Value | Restricted LLC Units | Weighted Average Grant Date Fair Value | ||||||
Unvested at beginning of period | 1,138,946 | $25.10 | 638,648 | $44.89 | |||||
Granted | — | — | — | — | |||||
Vested | — | — | (84,527) | 40.39 | |||||
Forfeited | — | — | — | — | |||||
Unvested at end of period | 1,138,946 | $25.10 | 554,121 | $45.55 | |||||
Class C Incentive Units
Reload and Staking Class C Incentive Units
As part of the Organizational Transactions and IPO, certain employees were granted Reload Class C Incentive Units or
Staking Class C Incentive Units, which are profits interests. When the value of Class A common stock exceeds the
participation threshold, vested profits interests may be exchanged for LLC Common Units of equal value. On exchange,
the LLC Common Units are immediately redeemed on a one-for-one basis for Class A common stock. The Reload Class C
Incentive Units either vested 100% 3 years from the grant date or vest over 5 years from the grant date, with one-third of
the grant vesting in each of years 3, 4 and 5. The Staking Class C Incentive Units vest either pro rata over 5 years from the
grant date or over 10 years from the grant date, with 10% vesting in each of years 3 through 9 and 30% vesting in year 10.
Class C Incentive Units
Class C Incentive Units are profits interests. When the value of Class A common stock exceeds the participation threshold,
vested profits interests may be exchanged for LLC Common Units of equal value. On exchange, the LLC Common Units
are immediately redeemed on a one-for-one basis for Class A common stock. The Class C Incentive Units vest over 8 years
from the grant date, with 15% vesting in each of years 3 through 7 and 25% vesting in year 8, or over 7 years from the
grant date, with 20% vesting in each of years 3 through 7.
As the Reload and Staking Class C Incentive Units were one-time grants at the IPO, the weighted-average participation
threshold for these awards will be consistent across any type of movement. The weighted-average participation threshold
for Reload and Staking Class C Incentive Units was $23.02 and $23.14 as of June 30, 2026 and December 31, 2025,
respectively. The decrease in the participation thresholds for the various types of Class C Incentive Units was due to the
distributions declared with respect to these awards during the six months ended June 30, 2026.
Performance Based Awards
Performance Stock Units (PSUs) and Performance LLC Units (PLUs)
Performance-based equity awards, PSUs and PLUs, are subject to the achievement of several defined performance and
market metrics. All performance awards are subject to a total shareholder return (“TSR”) compound annual growth rate
(“CAGR”) target and one or more of the following metrics: (i) an Adjusted EBITDAC margin target, (ii) an Organic
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revenue CAGR target, or (iii) an individual revenue target. The TSR CAGR is calculated from the base price, as outlined in
the respective grant agreements, to the volume weighted-average price (“VWAP”) of Class A common stock for the period
specified by the grant agreement plus dividends paid to Class A common shareholders. A minimum threshold for the TSR
CAGR, as well as the targets for the other metrics, as applicable, must all be met in order for the awards to vest.
In general, the PSUs and PLUs vest 5 years from the grant date. PSUs represent the right to receive Class A common
shares and PLUs represent the right to receive LLC Common Units upon vesting. If the minimum threshold of the TSR
CAGR is achieved, and the other required targets are achieved, the TSR CAGR target and, if applicable, the individual
revenue target, will determine how many Class A common shares or LLC Common Units, as applicable, the awards vest
into. Assuming at least the minimum thresholds are met, the awards will vest into between 75% and 150% of the applicable
target stock or units, which will be calculated on a graduated basis. Confirmation of the targets will not occur until after
earnings are reported for the final fiscal year in the award’s performance period. The probability of achieving the
performance metrics is assessed each reporting period for expense purposes. During the year ended December 31, 2025, it
was determined that the Adjusted EBITDAC margin target for the executive PSUs and PLUs granted in fiscal year 2024
was not probable of being achieved and, as a result, the expense previously recognized for these awards was reversed.
Six Months Ended June 30, 2026 | |||||||||
PSUs | PLUs | ||||||||
Performance Stock Units | Weighted Average Grant Date Fair Value | Performance LLC Units | Weighted Average Grant Date Fair Value | ||||||
Unvested at beginning of period | 1,612,920 | $27.73 | 487,218 | $24.40 | |||||
Granted | — | — | — | — | |||||
Vested | — | — | — | — | |||||
Forfeited | (22,743) | 27.53 | — | — | |||||
Unvested at end of period | 1,590,177 | $27.74 | 487,218 | $24.40 | |||||
Non-Employee Director Stock Grants
The Company grants RSUs to non-employee directors serving as members of the Company’s Board of Directors (“Director
Stock Grants”). The Director Stock Grants are fully vested upon grant. The Company granted 56,600 Director Stock Grants
with a weighted-average grant date fair value of $34.74 and 23,230 Director Stock Grants with a weighted-average grant
date fair value of $69.94 during the six months ended June 30, 2026 and 2025, respectively.
Dividend Equivalents and Declared Distributions
A majority of the Company’s unvested equity-based compensation awards, with the exception of Options and Class C
Incentive Units, are entitled to accrue dividend equivalents if the award vests into Class A common stock (“Dividend
Equivalents”) or declared distributions if the award vests into LLC Common Units (“Declared Distributions”) over the
period the underlying award vests. The Dividend Equivalents and Declared Distributions will be paid in cash to award
holders at the time the underlying award vests. If an award holder forfeits their underlying award, the accrued Dividend
Equivalents or Declared Distributions will also be forfeit. Class C Incentive Units do not accrue cash distributions but
instead have their participation thresholds lowered by each Declared Distribution. Options do not participate in dividends.
As of June 30, 2026, the Company accrued $1.9 million and $0.2 million related to Dividend Equivalents and Declared
Distributions, respectively, in Accounts payable and accrued liabilities, and $4.8 million and $0.6 million related to
Dividend Equivalents and Declared Distributions, respectively, in Other non-current liabilities on the Consolidated Balance
Sheets. As of December 31, 2025, the Company accrued $1.1 million and $0.1 million related to Dividend Equivalents and
Declared Distributions, respectively, in Accounts payable and accrued liabilities, and $4.3 million and $0.6 million related
to Dividend Equivalents and Declared Distributions, respectively, in Other non-current liabilities on the Consolidated
Balance Sheets.
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Equity-Based Compensation Expense
The following table includes the equity-based compensation the Company recognized by award type:
Three Months Ended June 30, | Six Months Ended June 30, | |||||||
2026 | 2025 | 2026 | 2025 | |||||
IPO awards | ||||||||
IPO RSUs and Staking Options | $1,517 | $2,415 | $3,135 | $5,081 | ||||
IPO RLUs and Staking Class C Incentive Units | 1,303 | 1,986 | 2,592 | 3,950 | ||||
Incremental Restricted Stock and Reload Options | 91 | 398 | 160 | 800 | ||||
Incremental Restricted Common Units and Reload Class C Incentive Units | 67 | 275 | 133 | 546 | ||||
Pre-IPO incentive awards | ||||||||
Restricted Stock | — | 158 | — | 322 | ||||
Restricted Common Units | — | 49 | — | 97 | ||||
Post-IPO incentive awards | ||||||||
Incentive RSUs | 13,848 | 7,933 | 23,461 | 16,767 | ||||
Incentive RLUs | 1,587 | 1,863 | 3,430 | 3,876 | ||||
Incentive Options | 769 | 1,145 | 824 | 1,958 | ||||
Class C Incentive Units | 320 | 445 | 760 | 954 | ||||
PSUs | 1,687 | 2,355 | 3,443 | 3,438 | ||||
PLUs | — | 612 | — | 1,218 | ||||
Other expense | ||||||||
Director Stock Grants | 200 | 291 | 802 | 791 | ||||
Total equity-based compensation expense | $21,389 | $19,925 | $38,740 | $39,798 | ||||
As of June 30, 2026, the unrecognized equity-based compensation expense and the related weighted-average remaining
expense period, as applicable, related to the types of equity-based compensation awards described above were as follows:
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10. Earnings Per Share
Basic earnings per share is computed by dividing net income attributable to Ryan Specialty Holdings, Inc. by the weighted-
average number of shares of Class A common stock outstanding during the period. Diluted earnings per share is computed
giving effect to potentially dilutive shares, including LLC equity awards and the non-controlling interests’ LLC Common
Units that are exchangeable into Class A common stock. As shares of Class B common stock do not share in earnings and
are not participating securities, they are not included in the Company’s calculation. A reconciliation of the numerator and
denominator used in the calculation of basic and diluted earnings per share of Class A common stock is as follows:
Three Months Ended June 30, | Six Months Ended June 30, | |||||||
2026 | 2025 | 2026 | 2025 | |||||
Net income | $108,381 | $124,705 | $148,978 | $120,316 | ||||
Less: Net income attributable to non-controlling interests | 66,066 | 72,729 | 89,017 | 95,982 | ||||
Net income attributable to Ryan Specialty Holdings, Inc. | $42,315 | $51,976 | $59,961 | $24,334 | ||||
Numerator: | ||||||||
Net income attributable to Class A common shareholders – basic | $42,315 | $51,976 | $59,961 | $24,334 | ||||
Add: Income attributed to dilutive shares | 513 | 52,392 | 485 | 1,077 | ||||
Net income attributable to Class A common shareholders – diluted | $42,828 | $104,368 | $60,446 | $25,411 | ||||
Denominator: | ||||||||
Weighted-average shares of Class A common stock outstanding – basic | 125,272,674 | 126,481,643 | 127,312,923 | 125,953,583 | ||||
Add: Dilutive shares | 6,052,983 | 147,663,338 | 7,009,182 | 12,212,962 | ||||
Weighted-average shares of Class A common stock outstanding – diluted | 131,325,657 | 274,144,981 | 134,322,105 | 138,166,545 | ||||
Earnings per share | ||||||||
Earnings per share of Class A common stock – basic | $0.34 | $0.41 | $0.47 | $0.19 | ||||
Earnings per share of Class A common stock – diluted | $0.33 | $0.38 | $0.45 | $0.18 | ||||
The following numbers of shares were excluded from the calculation of diluted earnings per share because the effect of
including such potentially dilutive shares would have been antidilutive:
Three Months Ended June 30, | Six Months Ended June 30, | |||||||
2026 | 2025 | 2026 | 2025 | |||||
Conversion of non-controlling interest LLC Common Units1 | 134,190,303 | — | 134,332,209 | 135,803,993 | ||||
Incentive RSUs | 3,038,195 | — | 3,038,195 | — | ||||
Incentive Options | 2,054,925 | — | 2,054,925 | — | ||||
Class C Incentive Units | 495,822 | — | 495,822 | — | ||||
1 Weighted-average units outstanding during the period.
11. Derivatives
Interest Rate Cap
In 2022, the Company entered into an interest rate cap agreement to manage its exposure to interest rate fluctuations related
to the Company’s Term Loan in the amount of $25.5 million. The interest rate cap had a $1,000.0 million notional amount,
2.75% strike, and terminated on December 31, 2025. At inception, the Company formally designated the interest rate cap
as a cash flow hedge, which remained effective through the instrument’s termination date.
22
For the three and six months ended June 30, 2025, the decreases of $2.8 million and $6.9 million, respectively, in the fair
value of the interest rate cap was recognized in OCI. See Note 16, Income Taxes, for further information on the tax effects
on OCI related to the interest rate cap. The location and gains (losses) related to the interest rate cap were recognized on the
Consolidated Statements of Income as follows:
See Note 13, Fair Value Measurements, for information on the fair value of the interest rate cap.
12. Variable Interest Entities
As discussed in Note 1, Basis of Presentation, the Company consolidates the LLC as a VIE under ASC 810. The
Company’s financial position, financial performance, and cash flows effectively represent those of the LLC as of and for
the six months ended June 30, 2026, with the exception of Cash and cash equivalents of $31.8 million, Other current assets
of $6.9 million, Deferred tax assets of $255.4 million, Accounts payable and accrued liabilities of $4.5 million, Other non-
current liabilities of $4.8 million, and the entire balance of the Tax Receivable Agreement liabilities of $463.7 million on
the Consolidated Balance Sheets, which are attributable solely to Ryan Specialty Holdings, Inc. As of December 31, 2025,
Cash and cash equivalents of $22.5 million, Other current assets of $18.3 million, Deferred tax assets of $309.1 million,
Accounts payable and accrued liabilities of $1.1 million, Other non-current liabilities of $4.3 million, and the entire balance
of the Tax Receivable Agreement liabilities of $459.0 million on the Consolidated Balance Sheets were attributable solely
to Ryan Specialty Holdings, Inc.
13. Fair Value Measurements
Accounting standards establish a three-tier fair value hierarchy that prioritizes the inputs used in measuring fair values as
follows:
Level 1: Observable inputs such as quoted prices for identical assets in active markets;
Level 2: Inputs other than quoted prices for identical assets in active markets, that are observable either directly or
indirectly; and
Level 3: Unobservable inputs in which there is little or no market data which requires the use of valuation techniques and
the development of assumptions.
The level in the fair value hierarchy within which the fair value measurement is classified is determined based on the
lowest level of input that is significant to the fair value measurement in its entirety.
The carrying amount of financial assets and liabilities reported on the Consolidated Balance Sheets for commissions and
fees receivable – net, other current assets, accounts payable, short-term debt, and other accrued liabilities as of June 30,
2026 and December 31, 2025, approximate fair value because of the short-term duration of these instruments. The fair
value of long-term debt, including the Term Loan, Senior Secured Notes, and any current portion of such debt, was
$3,241.6 million and $3,308.4 million as of June 30, 2026 and December 31, 2025, respectively. The fair value of the Term
Loan and Senior Secured Notes would be classified as Level 2 in the fair value hierarchy. See Note 7, Debt, for the
carrying values of the Company’s debt.
Interest Rate Cap
The Company used an interest rate cap to manage its exposure to interest rate fluctuations related to the Company’s Term
Loan. The fair value of the interest rate cap was determined using the market standard methodology of discounting the
future expected cash receipts that would occur if variable interest rates rose above the strike rate of the cap. The variable
interest rates used in the calculation of projected receipts on the cap were based on an expectation of future interest rates
derived from observable market interest rate curves and volatilities. The inputs used in determining the fair value of the
interest rate cap were considered Level 2 inputs. See Note 11, Derivatives, for further information on the interest rate cap.
23
Contingent Consideration
The fair values of contingent consideration and contingently returnable consideration are based on the present value of the
future expected payments to be made to the sellers and to be received from the sellers, respectively, of certain acquired
businesses in accordance with the provisions outlined in the respective purchase agreements, which are Level 3 fair value
measurements. In determining fair value, the Company estimates cash payments and receipts based on management’s
financial projections of the performance of each acquired business relative to the formula specified by each purchase
agreement. The Company utilizes Monte Carlo simulations to evaluate financial projections of each acquired business. The
Monte Carlo models consider forecasted revenue and EBITDA and market risk-adjusted revenue and EBITDA, which are
run through a series of simulations. As of June 30, 2026, the models used risk-free rates, expected volatility, and a credit
spread that ranged from 2.5% to 4.1%, 6.7% to 25.8%, and 0.6% to 2.4%, respectively. As of December 31, 2025, the
models used risk-free rates, expected volatility, and a credit spread that ranged from 1.9% to 3.7%, 6.2% to 21.5%, and
0.8% to 2.7%, respectively. The Company discounts the expected payments created by the Monte Carlo model to present
value using a risk-adjusted rate that takes into consideration the market-based rates of return that reflect the ability of the
acquired entity to achieve its targets. The discount rate ranges used to present value the cash payments were 4.7% to 6.5%
and 4.2% to 6.4% as of June 30, 2026 and December 31, 2025, respectively.
Each period, the Company revalues the contingent consideration and contingently returnable consideration associated with
certain prior acquisitions to their fair value and records the related changes of the fair value in Change in contingent
consideration on the Consolidated Statements of Income. Changes in contingent consideration result from changes in the
assumptions regarding probabilities of successful achievement of related EBITDA and revenue milestones, the estimated
timing in which milestones are achieved, and the discount rate used to estimate the fair value. Contingent consideration
may change significantly as the Company’s revenue growth rate and EBITDA estimates evolve and additional data is
obtained, impacting the Company’s assumptions. The use of different assumptions and judgments could result in a
materially different estimate of fair value which may have a material impact on the results from operations and financial
position. See Note 3, Mergers and Acquisitions, for further information on contingent consideration.
Assets and Liabilities Measured at Fair Value on a Recurring Basis
The following table presents information about the Company’s assets and liabilities measured at fair value on a recurring
basis by fair value hierarchy input level:
Contingently returnable consideration of $3.1 million and $3.3 million was recorded in Other current assets on the
Consolidated Balance Sheets as of June 30, 2026 and December 31, 2025, respectively. Contingently returnable
consideration of $3.3 million was recorded in Other non-current assets on the Consolidated Balance Sheets as of
December 31, 2025. Contingent consideration of $142.7 million and $55.9 million was recorded in Accounts payable and
accrued liabilities on the Consolidated Balance Sheets as of June 30, 2026 and December 31, 2025, respectively.
Contingent consideration of $10.7 million and $92.5 million was recorded in Other non-current liabilities on the
Consolidated Balance Sheets as of June 30, 2026 and December 31, 2025, respectively.
24
Level 3 Assets and Liabilities Measured at Fair Value
The following is a reconciliation of the beginning and ending balances of the Level 3 assets and liabilities measured at fair
value:
Three Months Ended June 30, | Six Months Ended June 30, | |||||||
2026 | 2025 | 2026 | 2025 | |||||
Assets | ||||||||
Balance at beginning of period | $3,197 | $5,110 | $6,550 | $5,483 | ||||
Total gains (losses) included in earnings | (64) | (77) | 114 | 1,277 | ||||
Foreign currency translation adjustments included in OCI | 7 | 307 | (112) | 507 | ||||
Settlements | — | — | (3,412) | (1,927) | ||||
Balance at end of period | $3,140 | $5,340 | $3,140 | $5,340 | ||||
Liabilities | ||||||||
Balance at beginning of period | $177,838 | $96,333 | $148,388 | $129,059 | ||||
Newly established liabilities due to acquisitions | — | 24,428 | — | 45,558 | ||||
Total (gains) losses included in earnings | 19,752 | 819 | 49,540 | (9,537) | ||||
Foreign currency translation adjustments included in OCI | (24) | 21 | (54) | 21 | ||||
Settlements | (44,145) | (5,507) | (44,453) | (49,007) | ||||
Acquisition measurement period adjustments | — | (1,467) | — | (1,467) | ||||
Balance at end of period | $153,421 | $114,627 | $153,421 | $114,627 | ||||
For the six months ended June 30, 2026, $0.3 million and $3.1 million of contingently returnable consideration settlements
are presented in the operating and financing sections, respectively, of the Consolidated Statements of Cash Flows. For the
six months ended June 30, 2025, the $1.9 million settlement of contingently returnable consideration is presented in the
financing section of the Consolidated Statements of Cash Flows. For the six months ended June 30, 2026, contingent
consideration settlements of $22.5 million and $22.0 million are presented in the operating and financing sections,
respectively, of the Consolidated Statements of Cash Flows. For the six months ended June 30, 2025, $19.4 million and
$29.3 million of contingent consideration settlements are presented in the operating and financing sections, respectively, of
the Consolidated Statements of Cash Flows.
14. Commitments and Contingencies
As an E&S and Admitted markets intermediary, the Company faces ordinary course of business E&O exposure. The
Company also has potential E&O risk if an insurance carrier with which Ryan Specialty placed coverage denies coverage
for a claim or pays less than the insured believes is the full amount owed. The Company seeks to resolve, through
commercial accommodations, certain matters to limit the economic exposure, including potential legal fees, and
reputational risk created by E&O matters or disagreements between a carrier and the insured.
The Company utilizes insurance to provide protection from E&O liabilities that may arise during the ordinary course of
business. Ryan Specialty’s E&O insurance provides aggregate coverage for E&O losses up to $150.0 million in excess of a
per claim retention amount of $5.0 million. The Company periodically determines a range of possible outcomes using the
best available information that relies, in part, on projecting historical claim data into the future. Loss contingencies of $4.7
million and $3.2 million were recorded for outstanding matters as of June 30, 2026 and December 31, 2025, respectively.
Loss contingencies exclude the impact of any loss recoveries and are recognized within Accounts payable and accrued
liabilities on the Consolidated Balance Sheets. The Company recognized the net impact of loss contingencies and any loss
recoveries of $1.3 million and $2.0 million of E&O expense for the three months ended June 30, 2026 and 2025,
respectively, and $2.7 million and $3.6 million for the six months ended June 30, 2026 and 2025, respectively, in General
and administrative expense on the Consolidated Statements of Income. The historical claim and commercial
accommodation data used to project the current estimates may not be indicative of future claim activity. Thus, the estimates
could change in the future as more information becomes known, which could materially impact the amounts reported and
disclosed herein.
25
15. Related Parties
Equity Method Investments
Ryan Investment Holdings
Ryan Investment Holdings, LLC (“RIH”) was formed as an investment holding company designed to aggregate the funds
of Ryan Specialty and Geneva Ryan Holdings, LLC (“GRH”) for investment in Geneva Re Partners, LLC (“GRP”). GRH
was formed as an investment holding company designed to aggregate investment funds of Patrick G. Ryan and other
affiliated investors. Two affiliated investors are LLC Unitholders and directors of the Company, and another is an LLC
Unitholder and employee of the Company. Ryan Specialty does not consolidate GRH as the Company does not have a
direct investment in or variable interest in this entity.
The Company holds a 47% interest in RIH and GRH holds the remaining 53% interest. RIH has a 50% non-controlling
interest in GRP and the other 50% is owned by Nationwide Mutual Insurance Company. GRP wholly owns Geneva Re, a
Bermuda-regulated reinsurance company, and GR Bermuda SAC Ltd (the “Segregated Account Company”). The
Segregated Account Company has one segregated account, which is beneficially owned by a third-party insurance
company (the “Third-party Insurer”). RIH is considered a related party variable interest entity under common control with
the Company. The Company is not most closely associated with the variable interest entity and therefore does not
consolidate RIH. The assets of RIH are restricted to settling obligations of RIH, pursuant to Delaware limited liability
company statutes.
The Company is not required to contribute any additional capital to RIH, and its maximum exposure to loss on the equity
method investment is the total invested capital of $47.0 million. The Company may be exposed to losses arising from the
equity method investment as a result of underwriting losses recognized at Geneva Re or losses on Geneva Re’s investment
portfolio. The carrying value of the Company’s equity method investment in RIH was $103.1 million and $92.7 million as
of June 30, 2026 and December 31, 2025, respectively. RIH has committed to contribute additional capital to GRP over the
next several years. Patrick G. Ryan, through a trust of which he is the beneficiary and co-trustee, has committed to
personally fund any such additional capital contributions. Any such additional capital contributions under this commitment
will not affect the relative ownership of RIH’s common equity.
Velocity Specialty Insurance Company
On May 1, 2025, the Company acquired a 9.9% interest in VSIC, an insurance carrier writing middle market and small to
medium business risks in catastrophe exposed areas, for $16.6 million. In the first quarter of 2026, the Company’s
ownership of VSIC decreased to 5.2% as a result of a capital contribution made by another investor in exchange for equity
issued by VSIC. A gain on ownership dilution of $0.7 million was recognized within Income from equity method
investments on the Consolidated Statements of Income during the six months ended June 30, 2026. The Company accounts
for its investment in VSIC under the equity method of accounting as the Company has the ability to exercise significant
influence over VSIC primarily through board representation. The carrying value of the Company’s equity method
investment in VSIC was $18.6 million and $17.3 million as of June 30, 2026 and December 31, 2025, respectively.
Other Related Parties
Geneva Re
The Company has a service agreement with Geneva Re to provide both administrative services to, as well as disburse
payments for costs directly incurred by, Geneva Re. These direct costs include compensation expenses incurred by
employees of Geneva Re. The Company had $0.4 million and $0.3 million due from Geneva Re under this agreement as of
June 30, 2026 and December 31, 2025, respectively.
Ryan Re Services Agreements with Geneva Re
Ryan Re, a wholly owned subsidiary of the Company, is party to a services agreement with Geneva Re to provide, among
other services, certain underwriting and administrative services to Geneva Re. Ryan Re receives a service fee equal to
115% of the administrative costs incurred by Ryan Re in providing these services to Geneva Re. Revenue earned from
Geneva Re was $0.5 million and $0.4 million for the three months ended June 30, 2026 and 2025, respectively, and $0.9
million and $0.8 million for the six months ended June 30, 2026 and 2025, respectively. Receivables due from Geneva Re
under this agreement were $0.9 million and $0.8 million as of June 30, 2026 and December 31, 2025, respectively.
Ryan Re is party to a services agreement with Geneva Re under which Ryan Re subcontracts certain services to Geneva Re
that are required for the segregated account of the Segregated Account Company on behalf of the Third-party Insurer. The
26
Company incurred expense of $2.8 million and $2.7 million during the three months ended June 30, 2026 and 2025,
respectively, and $5.7 million and $5.4 million during the six months ended June 30, 2026 and 2025, respectively. As of
June 30, 2026 and December 31, 2025, the Company had prepaid expenses of $1.2 million and $6.4 million, respectively,
related to this services agreement. The prepaid expenses are included in Other currents assets on the Consolidated Balance
Sheets.
Claims Management Agreement with VSIC
Velocity Claims, LLC (“Velocity Claims”) and Velocity, wholly owned subsidiaries of the Company, are party to a claims
management agreement with VSIC under which Velocity Claims receives compensation equal to 1% of indemnity and
expenses paid, net of subrogation, for each claim on which Velocity participates. Revenue recognized from this agreement
was $0.2 million and $0.3 million for the three and six months ended June 30, 2026, respectively. Receivables due from
VSIC under this agreement were $0.1 million as of June 30, 2026 and December 31, 2025.
Company Leasing of Corporate Jets
In the ordinary course of its business, the Company charters executive jets for business purposes from Executive Jet
Management (“EJM”), a third-party service provider. Mr. Ryan indirectly owns aircraft that he leases to EJM for EJM’s
charter operations for which he receives remuneration from EJM. The Company pays market rates for chartering aircraft
through EJM, unless the particular aircraft chartered is one that Mr. Ryan indirectly owns, in which case the Company
receives a discount and pays below market rates. Generally, the Company has been able to charter aircraft indirectly owned
by Mr. Ryan and make use of this discount. The Company recognized expense related to business usage of the aircraft of
$0.2 million and $0.1 million for the three months ended June 30, 2026 and 2025, respectively, and $0.4 million and $0.2
million for the six months ended June 30, 2026 and 2025, respectively.
Option Settlement Agreement
In connection with the Company’s grant of incentive stock options to certain employees during the three months ended
June 30, 2026, the Company entered into an option settlement agreement (the “Option Settlement Agreement”) with a trust
for which the Ryan Parties serve as trustees. The purpose of the Option Settlement Agreement is to offset the dilutive effect
of the grant and exercise of these incentive stock options on the Company’s outstanding Class A common stock, such that
the related incentive stock option exercises and share repurchases from the Option Settlement Agreement are expected to
result in zero incremental shares outstanding.
Pursuant to the Option Settlement Agreement, the Company has a conditional obligation to repurchase shares from the trust
upon the exercise of the related incentive stock options by employee option holders. Upon each exercise, the trust will sell
to the Company, and the Company will repurchase from the trust, shares of Class A common stock at the applicable option
exercise price equal to the number of shares underlying the exercised options, up to an aggregate repurchase amount of
$53.0 million. Shares repurchased under the Option Settlement Agreement will be retired upon repurchase.
Repurchases made under the Option Settlement Agreement will be effected outside of the Company’s authorized share
repurchase program and will not count toward any repurchase limitations established under that program. Because the
Company’s repurchase obligation is initially conditional and relates to a variable number of shares, no liability is
recognized until the underlying incentive stock options are exercised and the obligation to repurchase shares becomes
unconditional. The Option Settlement Agreement expires on June 9, 2036.
16. Income Taxes
The Company is taxed as a corporation for income tax purposes and is subject to federal, state, and local taxes with respect
to its allocable share of any net taxable income from the LLC. The LLC is a limited liability company taxed as a
partnership for income tax purposes, and its taxable income or loss is passed through to its members, including the
Company. The LLC is subject to income taxes on its taxable income in certain foreign countries, in certain state and local
jurisdictions that impose income taxes on partnerships, and on the taxable income of its U.S. corporate subsidiaries.
Effective Tax Rate
The Company’s effective tax rate from continuing operations was 17.10% and 9.60% for the three months ended June 30,
2026 and 2025, respectively, and 16.20% and 36.30% for the six months ended June 30, 2026 and 2025, respectively. The
effective tax rate for the three and six months ended June 30, 2026, and the three months ended June 30, 2025, was lower
than the 21% statutory rate primarily as result of the income attributable to the non-controlling interests. The effective tax
rate for the six months ended June 30, 2025, was higher than the 21% statutory rate primarily as a result of the non-cash
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deferred income tax expense from the CCR related to the acquisition of Velocity, which is described below, offset by a
decrease related to the income attributable to the non-controlling interests.
The Company does not believe it has any significant uncertain tax positions and therefore has no unrecognized tax benefits
as of June 30, 2026, that, if recognized, would affect the annual effective tax rate. The Company does not anticipate
material changes in unrecognized tax benefits within the next twelve-month period.
Deferred Taxes
The Company reported Deferred tax assets, net of deferred tax liabilities where appropriate, of $256.6 million and $310.1
million as of June 30, 2026 and December 31, 2025, respectively, on the Consolidated Balance Sheets. The decrease in the
Deferred tax assets during the six months ended June 30, 2026, was primarily attributable to repurchases of Class A
common stock. As of June 30, 2026, the Company concluded that, based on the weight of all available positive and
negative evidence, the deferred tax assets with respect to the Company’s basis difference in its investment in the LLC are
more likely than not to be realized. As such, no valuation allowance has been recognized against that basis difference.
Common Control Reorganization (CCR)
Subsequent to the acquisition of Velocity, which was acquired by a wholly owned subsidiary of Ryan Specialty Holdings,
Inc., the Company converted Velocity into an LLC (“Velocity LLC”) and transferred Velocity LLC to the LLC. This legal
entity reorganization was considered a transaction between entities under common control. The CCR, inclusive of impacts
from the Velocity measurement period adjustment, resulted in a reduction of deferred tax assets in the Company’s basis
difference in its investment in the LLC of $145.1 million and a non-cash deferred income tax expense of $48.0 million for
the six months ended June 30, 2025. Additionally, the difference between the carrying value and the fair value of the
investment transferred under common control resulted in an increase of $29.8 million to Non-controlling interests on the
Consolidated Statements of Stockholders’ Equity during the six months ended June 30, 2025.
Tax Receivable Agreement (TRA)
The Company is party to a TRA with current and certain former LLC Unitholders. The TRA provides for the payment by
the Company to the current and certain former LLC Unitholders of 85% of the net cash savings, if any, in U.S. federal,
state, and local income taxes that the Company actually realizes (or under certain circumstances is deemed to realize) from
(i) certain increases in the tax basis of the assets of the LLC resulting from purchases or exchanges of LLC Common Units
(“Exchange Tax Attributes”), (ii) certain tax attributes of the LLC that existed prior to the IPO (“Pre-IPO M&A Tax
Attributes”), (iii) certain favorable “remedial” partnership tax allocations to which the Company becomes entitled (if any),
and (iv) certain other tax benefits related to the Company entering into the TRA, including certain tax benefits attributable
to payments that the Company makes under the TRA (“TRA Payment Tax Attributes”). The Company recognizes a
liability on the Consolidated Balance Sheets based on the undiscounted estimated future payments under the TRA. The
amounts payable under the TRA will vary depending upon a number of factors, including the amount, character, and timing
of the taxable income of the Company in the future.
Based on current projections, the Company anticipates having sufficient taxable income to be able to realize the benefits
and has recorded Tax Receivable Agreement liabilities of $463.7 million related to these benefits on the Consolidated
Balance Sheets as of June 30, 2026. The following summarizes activity related to the Tax Receivable Agreement liabilities:
During the six months ended June 30, 2026 and 2025, increases to the TRA liabilities of $4.3 million and $24.5 million,
respectively, due to exchanges of LLC Common Units for Class A common stock were recognized in Additional paid-in
capital on the Consolidated Statements of Stockholders’ Equity. During the six months ended June 30, 2026 and 2025,
increases to the TRA liabilities of $0.4 million due to accrued interest were recognized in Other non-operating loss
(income) on the Consolidated Statements of Income.
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Other Comprehensive Income
The following table summarizes the tax effects on the components of OCI:
Three Months Ended June 30, | Six Months Ended June 30, | |||||||
2026 | 2025 | 2026 | 2025 | |||||
Gain on interest rate cap | $— | $(293) | $— | $(513) | ||||
Gain on interest rate cap reclassified to earnings | — | 409 | — | 943 | ||||
Foreign currency translation adjustments | 203 | (3,660) | 1,844 | (6,644) | ||||
Change in share of equity method investments’ other comprehensive income (loss) | 262 | (272) | 186 | 190 | ||||
17. Accumulated Other Comprehensive Income (Loss)
Changes in the balance of Accumulated other comprehensive income (loss), net of tax, were as follows:
Foreign Currency Translation Adjustments | Change in EMI Other Comprehensive Income (Loss)1 | Total | ||||
Balance at December 31, 2025 | $13,778 | $67 | $13,845 | |||
Other comprehensive income (loss) before reclassifications | (11,262) | 518 | (10,744) | |||
Amounts reclassified to earnings | — | — | — | |||
Other comprehensive income (loss) | $(11,262) | $518 | $(10,744) | |||
Less: Non-controlling interests | (6,592) | 303 | (6,289) | |||
Balance at March 31, 2026 | $9,108 | $282 | $9,390 | |||
Other comprehensive loss before reclassifications | (1,964) | (1,854) | (3,818) | |||
Amounts reclassified to earnings | — | — | — | |||
Other comprehensive loss | $(1,964) | $(1,854) | $(3,818) | |||
Less: Non-controlling interests | (1,382) | (1,110) | (2,492) | |||
Balance at June 30, 2026 | $8,526 | $(462) | $8,064 |
Gain on Interest Rate Cap | Foreign Currency Translation Adjustments | Change in EMI Other Comprehensive Income (Loss)1 | Total | |||||
Balance at December 31, 2024 | $1,435 | $(3,010) | $(221) | $(1,796) | ||||
Other comprehensive income (loss) before reclassifications | 1,414 | 18,632 | (2,909) | 17,137 | ||||
Amounts reclassified to earnings | (3,419) | — | — | (3,419) | ||||
Other comprehensive income (loss) | $(2,005) | $18,632 | $(2,909) | $13,718 | ||||
Less: Non-controlling interests | (1,107) | 10,151 | (1,594) | 7,450 | ||||
Balance at March 31, 2025 | $537 | $5,471 | $(1,536) | $4,472 | ||||
Other comprehensive income before reclassifications | 2,560 | 27,783 | 1,575 | 31,918 | ||||
Amounts reclassified to earnings | (3,571) | — | — | (3,571) | ||||
Other comprehensive income (loss) | $(1,011) | $27,783 | $1,575 | $28,347 | ||||
Less: Non-controlling interests | (682) | 17,347 | 799 | 17,464 | ||||
Balance at June 30, 2025 | $208 | $15,907 | $(760) | $15,355 |
1 Change in share of equity method investments’ other comprehensive income (loss) on the Consolidated Statements of
Comprehensive Income.
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18. Segment Reporting
Segment Information
Ryan Specialty is organized as a single operating and reporting segment. The Company’s chief operating decision maker
(“CODM”) is its Chief Executive Officer. The Company has identified its single operating segment utilizing a management
approach that aligns with the manner in which the CODM utilizes the Company’s consolidated financial information for
resource allocation and performance evaluation. Refer to Note 1, Basis of Presentation, for a description of the Company’s
products and services and to Note 2, Revenue from Contracts with Customers, for the disaggregation of revenue by
Specialty.
The CODM utilizes consolidated net income as the primary metric to monitor budget versus actual results, assess the
performance of the business, and make decisions regarding resource allocation. The following table provides information
about the Company’s revenue and includes a reconciliation to net income:
Three Months Ended June 30, | Six Months Ended June 30, | |||||||
2026 | 2025 | 2026 | 2025 | |||||
Net commissions and fees | $902,728 | $840,857 | $1,685,631 | $1,516,985 | ||||
Fiduciary investment income | 13,919 | 14,313 | 26,245 | 28,351 | ||||
Total revenue | $916,647 | $855,170 | $1,711,876 | $1,545,336 | ||||
Compensation-related expense1 | 494,946 | 453,414 | 956,778 | 850,842 | ||||
General and administrative expense2 | 94,797 | 93,350 | 196,162 | 185,587 | ||||
Other segment items3 | 60,517 | 45,557 | 101,257 | 92,241 | ||||
Depreciation and amortization | 68,520 | 72,556 | 137,922 | 140,180 | ||||
Change in contingent consideration | 17,551 | (759) | 44,845 | (14,801) | ||||
Interest income | (1,653) | (1,482) | (2,799) | (4,585) | ||||
Interest expense | 58,302 | 59,816 | 113,181 | 117,427 | ||||
Income from equity method investments | (7,039) | (5,156) | (12,570) | (10,093) | ||||
Other non-operating loss (income) | (25) | 143 | (736) | (234) | ||||
Income tax expense | 22,350 | 13,026 | 28,858 | 68,456 | ||||
Net income | $108,381 | $124,705 | $148,978 | $120,316 | ||||
1 Compensation-related expense includes salaries, commissions, bonus compensation, benefits, payroll taxes, and
contractor costs, and excludes acquisition and restructuring related expenses and equity-based compensation.
2 General and administrative expense includes travel and entertainment, professional services, occupancy, IT related costs,
and other operating costs, and excludes acquisition and restructuring related expenses.
3 Other segment items include acquisition and restructuring related expenses and equity-based compensation.
Geographic Information
Revenue is primarily recognized based on the country in which the services are performed. The following table illustrates
the geographic regions for the Company’s revenue:
Three Months Ended June 30, | Six Months Ended June 30, | |||||||
2026 | 2025 | 2026 | 2025 | |||||
United States | $852,082 | $801,491 | $1,594,680 | $1,450,588 | ||||
Foreign | 64,565 | 53,679 | 117,196 | 94,748 | ||||
Total revenue | $916,647 | $855,170 | $1,711,876 | $1,545,336 | ||||
The Company did not have material revenue from operations in any individual foreign country for the three and six months
ended June 30, 2026 or 2025. Asset information is not presented to the CODM. Substantially all of the Company’s tangible
long-lived assets are located in the United States; therefore, geographic information for long-lived assets is not presented.
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19. Supplemental Financial Information
Interest Income
The Company earned interest income of $1.7 million and $1.5 million during the three months ended June 30, 2026 and
2025, respectively, and $2.8 million and $4.6 million during the six months ended June 30, 2026 and 2025, respectively, on
its operating Cash and cash equivalents. Interest income is recognized in Interest expense, net on the Consolidated
Statements of Income.
Supplemental Cash Flow Information
The following represents the supplemental cash flow information of the Company:
Six Months Ended June 30, | ||||
2026 | 2025 | |||
Cash paid (received) for: | ||||
Interest, net1 | $103,383 | $95,414 | ||
Income taxes, net of refunds | (12,778) | 6,371 | ||
Non-cash investing and financing activities: | ||||
Non-controlling interest holders’ tax distributions declared but unpaid | $900 | $1,643 | ||
Tax Receivable Agreement liabilities | 4,283 | 24,460 | ||
Excise tax payable on net share repurchases | 2,644 | — | ||
Dividend Equivalents and Declared Distributions liabilities | 1,418 | 1,662 | ||
Contingent consideration liabilities | — | 44,091 | ||
1 Interest paid is presented net of $7.9 million of cash received in connection with the Company’s interest rate cap for the
six months ended June 30, 2025. See Note 11, Derivatives, for further information on the interest rate cap.
20. Subsequent Events
The Company has evaluated subsequent events through July 31, 2026, and has concluded that no events have occurred that
require disclosure other than the events listed below.
On July 10, 2026, the Company sold its remaining 5.2% interest in VSIC for $23.3 million.
On July 30, 2026, the Company’s Board of Directors approved a quarterly cash dividend of $0.13 per share of outstanding
Class A common stock. The quarterly dividend will be payable on August 25, 2026, to shareholders of record of Class A
common stock as of the close of business on August 11, 2026. Any future dividends will be subject to the approval of the
Company’s Board of Directors.
Subsequent to June 30, 2026, and through July 30, 2026, the Company repurchased 986,828 shares of Class A common
stock for an aggregate purchase price of $42.0 million.
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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
The following discussion and analysis summarizes the significant factors affecting the consolidated operating results,
financial condition, liquidity, and cash flows of the Company as of and for the periods presented below. The following
discussion and analysis should be read in conjunction with our Consolidated Financial Statements and the related notes
included elsewhere in this Quarterly Report on Form 10-Q and in the Annual Report on Form 10-K for the year ended
December 31, 2025, which was filed with the SEC on February 13, 2026. The discussion contains forward-looking
statements that are based on the beliefs of management, as well as assumptions made by, and information currently
available to, our management. Actual results could differ materially from those discussed in or implied by forward-looking
statements as a result of various factors, including those discussed below and in our Annual Report on Form 10-K,
particularly in the sections entitled “Risk Factors” and “Information Concerning Forward-Looking Statements.”
The following discussion provides commentary on the financial results derived from our unaudited financial statements for
the three and six months ended June 30, 2026 and 2025, prepared in accordance with U.S. GAAP. In addition, we
regularly review the following Non-GAAP measures when assessing performance: Organic revenue growth rate, Adjusted
compensation and benefits expense, Adjusted compensation and benefits expense ratio, Adjusted general and
administrative expense, Adjusted general and administrative expense ratio, Adjusted EBITDAC, Adjusted EBITDAC
margin, Adjusted net income, Adjusted net income margin, and Adjusted diluted earnings per share. See “Non-GAAP
Financial Measures and Key Performance Indicators” for further information.
Overview
Founded by Patrick G. Ryan in 2010, we are a service provider of specialty products and solutions for insurance brokers,
agents, and carriers. We provide distribution, underwriting, product development, administration, and risk management
services by acting predominantly as a wholesale broker and a managing underwriter or a program administrator with
delegated authority from insurance carriers. Our mission is to provide industry-leading innovative specialty insurance
solutions for insurance brokers, agents, and carriers.
For retail insurance agents and brokers, we assist in the placement of complex or otherwise hard-to-place risks. For
insurance and reinsurance carriers, we predominantly work with retail and wholesale insurance brokers to source, onboard,
underwrite, and service these same types of risks. A significant majority of the premiums we place are bound in the E&S
market, which includes Lloyd’s of London. There is often significantly more flexibility in terms, conditions, and rates in
the E&S market relative to the Admitted or “standard” insurance market. We believe that the additional freedom to craft
bespoke terms and conditions in the E&S market allows us to best meet the needs of our trading partners, provide unique
solutions, and drive innovation. We believe our success has been achieved by providing best-in-class intellectual capital,
leveraging our trusted and long-standing relationships, and developing differentiated solutions at a scale unmatched by
many of our competitors.
Significant Events and Transactions
Corporate Structure
We are a holding company and our sole material asset is a controlling equity interest in New LLC, which is also a holding
company and its sole material asset is a controlling equity interest in the LLC. The Company operates and controls the
business and affairs of, and consolidates the financial results of, the LLC through New LLC. We conduct our business
through the LLC. As the LLC is substantively the same as New LLC, for the purpose of this discussion we will refer to
both New LLC and the LLC as the “LLC”.
The LLC is a limited liability company taxed as a partnership for income tax purposes, and its taxable income or loss is
passed through to its members, including the Company. The LLC is subject to income taxes on its taxable income in certain
foreign countries, in certain state and local jurisdictions that impose income taxes on partnerships, and on the taxable
income of its U.S. corporate subsidiaries. As a result of our ownership of LLC Common Units, we are subject to U.S.
federal, state, and local income taxes with respect to our allocable share of any taxable income of the LLC and are taxed at
the prevailing corporate tax rates. We intend to cause the LLC to make distributions in an amount that is at least sufficient
to allow us to pay our tax obligations and operating expenses, including distributions to fund any ordinary course payments
due under the Tax Receivable Agreement. See “Liquidity and Capital Resources - Tax Receivable Agreement” for
additional information about the TRA.
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Empower Program
In the first quarter of 2026, we initiated a three-year restructuring program (the “Empower Program”) that will streamline
our brokerage, binding, and underwriting operations, optimize our scale, accelerate our data and technology strategies, and
enhance efficiencies across all of our Specialties. The program is estimated to result in approximately $160 million of
cumulative one-time charges through 2028, funded through operating cash flow, and is expected to generate annual savings
of approximately $80 million in 2029. Actions taken under the Empower Program are expected to be completed by the end
of 2028. Restructuring costs will primarily be included in General and administrative expense, relating to third-party
professional services, technology and data initiatives, and other expenses. The remaining costs will be incurred through
Compensation and benefits expense, predominately relating to third-party contractor and other workforce-related costs.
We began recognizing costs associated with the restructuring plan in the first quarter of 2026. For the three and six months
ended June 30, 2026, we incurred restructuring and related costs of $33.4 million and $39.3 million, respectively, with the
$39.3 million recognized over the first six months of 2026 representing cumulative costs since the inception of the
program. Of the cumulative $39.3 million expense, $25.2 million was incurred in general and administrative expense with
the remaining being workforce-related costs. Restructuring expense within general and administrative expense includes
costs relating to professional services, technology and data initiatives, license fees, and third-party contractors, as well as
non-cash expenses associated with the impairment of internally-developed software. Compensation and benefits
restructuring costs include severance as well as employment costs for services rendered between the notification and
termination dates and other termination payments. While the current results of the Empower Program are in line with
expectations, changes to the total savings estimate and timing of the Empower Program may evolve as we continue to
progress through the program and evaluate other potential opportunities. The actual amounts and timing may vary
significantly based on various factors.
Key Factors Affecting Our Performance
Our historical financial performance has been, and we expect our financial performance in the future to be, driven by our
ability to:
Pursue Strategic Acquisitions
We have successfully integrated businesses complementary to our own to increase both our distribution reach and our
product and service capabilities. We continuously evaluate acquisitions and intend to further pursue targeted acquisitions
that complement our product and service capabilities or provide us access to new markets. We have previously made, and
intend to continue to make, acquisitions with the objective of enhancing our human capital and product and service
capabilities, entering natural adjacencies, and expanding our geographic presence. Our ability to successfully pursue
strategic acquisitions is dependent upon a number of factors, including sustained execution of a disciplined and selective
acquisition strategy which requires acquisition targets to have a cultural and strategic fit, competition for these assets,
purchase price multiples that we deem appropriate and our ability to effectively integrate targeted companies or assets and
grow our business. We do not have agreements or commitments for any material acquisitions at this time.
Deepen and Broaden our Relationships with Retail Broker Trading Partners
We have deep engagement with our retail broker trading partners, and we believe we have the ability to transact in even
greater volume with nearly all of them. For example, in 2025, our revenue derived from the Top 100 firms (as ranked by
Business Insurance) expanded faster than our Organic revenue growth rate of 10.1%. Our ability to deepen and broaden
relationships with our retail broker trading partners and increase sales is dependent upon a number of factors, including
client satisfaction with our distribution reach and our product capabilities, retail brokers continuing to require or desire our
services, competition, pricing, economic conditions, and spending on our product offerings.
Build Our Delegated Authority Business
We believe there is substantial opportunity to continue to grow our Delegated Authority business, which includes both our
Binding Authority Specialty and Underwriting Management Specialty. We believe that both M&A consolidation and panel
consolidation have a long runway. We believe that both M&A consolidation and the use and reliance on scaled delegated
Underwriting Management will continue to grow. Our ability to grow this business is dependent upon a number of factors,
including a continuing ability to secure sufficient capital support from insurers, the quality of our services and product
offerings, marketing and sales efforts to drive new business prospects and execution, new product offerings, the pricing and
quality of our competitors’ offerings, and the growth in demand for the insurance products.
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Invest in Operations and Growth
We have invested heavily in building a durable business that is able to adapt to the continuously evolving specialty and
E&S markets and intend to continue to do so. We are focused on enhancing the breadth of our product and service
offerings as well as developing and launching new solutions to address the evolving needs of the specialty insurance
industry and markets. Our future success is dependent upon a number of factors, including our ability to successfully
develop, market, and sell existing and new products and services to both new and existing trading partners. We will
continue to prioritize strategic investments that support revenue growth such as investments in talent, de novo formations,
product innovation and solutions, M&A, and technology in order to maximize long-term value creation, which could have
a short-term margin impact.
The Empower Program initiated in the first quarter of 2026 is designed to enhance efficiencies across all of our Specialties.
The efficiencies we gain through the Empower Program are expected to allow us to continue making strategic investments
in growth, top-tier talent, and de novo formations, and address the rapidly evolving needs of our clients.
Generate Commission Regardless of the State of the Specialty and E&S Markets
We earn commissions, which are calculated as a percentage of the total insurance policy premium, and fees. Changes in the
insurance market or specialty lines that are our focus, characterized by a period of increasing (or declining) premium rates,
could positively (or negatively) impact our profitability.
Managing Changing Macroeconomic Conditions
Growth in certain lines of business, such as project-based construction and M&A transactional liability insurance, is
partially dependent on a variety of macroeconomic factors inasmuch as binding the underlying insurance coverage is
subject to the underlying activity occurring. In periods of economic growth, liquid credit markets, and favorable interest
rates, this underlying activity can accelerate and provide tailwinds to our growth. In periods of economic decline, tight
credit markets, and unfavorable interest rates, this underlying activity can slow or be delayed and provide headwinds to our
growth. We believe over the long term these lines of business will continue to grow.
Leverage the Growth of the Specialty and E&S Markets
The growing relevance of the specialty and E&S markets has been driven by the rapid emergence and sustained prevalence
of large, complex, high-hazard, and otherwise hard-to-place risks across many lines of insurance. This trend continued in
2025, with $125 billion of insured catastrophe losses, driven by $52 billion of insured losses related to severe convective
storms (“SCS”) with 19 SCS events that caused losses in excess of $1 billion, which together accounted for the third-
highest annual total for insured losses on record for SCS events, and over $41 billion in losses generated from California
wildfires. The year also included floods in central Texas and the Mississippi valley, causing over 135 fatalities and over $3
billion in insured losses. Additionally, these risks include the potential for more severe hurricanes that occur with greater
frequency, more devastating wildfires, more frequent flooding, escalating jury verdicts and social inflation, geographic
shifts in population density, a proliferation of cyber threats, novel health risks, risks associated with large sports and
entertainment venues, building and labor cost inflation relative to insured value, and the transformation of the economy to a
“digital first” mode of doing business. We believe that as the complexity of the specialty and E&S markets continues to
escalate, wholesale brokers and managing underwriters that do not have sufficient scale, or the financial and intellectual
capital to invest in the required specialty capabilities, will struggle to compete effectively. This will further the trend of
market share consolidation among the wholesale firms that do have these capabilities. We will continue to invest in our
intellectual capital to innovate and offer custom solutions and products to better address these evolving market
fundamentals.
Although we believe this growth will continue, we recognize that the growth of the specialty and E&S markets might not
be linear as risks can and do shift between the E&S, including the specialty market, and non-E&S markets as market
factors change and evolve. For example, we benefited from a rapid increase in both the flow of property risks into the
wholesale channel and the premium rate charged for those risks in 2023 and the first half of 2024 as the frequency and
severity of catastrophe losses, attritional losses and secondary perils such as severe convective storms, economic inflation,
concentration of exposures, higher retentions of risk, and higher reinsurance costs applied pressure to insurers and capacity
tightened. Beginning in the second half of 2024 and through the first half of 2026, the specialty and E&S markets
experienced a shift in these trends as insurance capacity for these property risks increased, which resulted in a decline in
property premium rates. We believe these factors have created additional opportunities for retailers to place property
coverage directly, and we believe the market dynamics exist for these factors to potentially continue throughout 2026.
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Components of Results of Operations
Revenue
Net Commissions and Fees
Net commissions and fees are derived primarily from our three Specialties and are paid for our role as an intermediary in
facilitating the placement of coverage in the insurance distribution chain. Net commissions and policy fees are generally
calculated as a percentage of the total insurance policy premium placed, although fees can often be a fixed amount
irrespective of the premium, and we also receive supplemental commissions based on the volume placed or profitability of
a book of business. We share a portion of these net commissions and policy fees with the retail insurance broker and
recognize revenue on a net basis. Additionally, carriers may also pay us a contingent commission or volume-based
commission, both of which represent forms of contingent or supplemental consideration associated with the placement of
coverage and are based primarily on underwriting results, but may also contain considerations for only volume, growth,
and/or retention. Although we have compensation arrangements called contingent commissions in all three Specialties that
are based in whole or in part on the underwriting performance, we do not take any direct insurance risk other than through
our equity method investments in Geneva Re, Ltd through Ryan Investment Holdings, LLC and VSIC. We also receive
loss mitigation and other fees, some of which are not dependent on the placement of a risk.
In our Wholesale Brokerage and Binding Authority Specialties, we generally work with retail insurance brokers to secure
insurance coverage for their clients, who are the ultimate insured party. Our Wholesale Brokerage and Binding Authority
Specialties generate revenues through commissions and fees from clients, as well as through supplemental commissions,
which may be contingent commissions or volume-based commissions from carriers. Commission rates and fees vary
depending upon several factors, which may include the amount of premium, the type of insurance coverage provided, the
particular services provided to a client or carrier, and the capacity in which we act. Payment terms are consistent with
current industry practice.
In our Underwriting Management Specialty, we utilize delegated authority granted to us by carriers and we work with retail
insurance brokers or wholesale brokers to secure insurance coverage for the ultimate insured party. Our Underwriting
Management Specialty generates revenues through insurance and reinsurance commissions and fees from clients and
through contingent commissions from carriers. Commission rates and fees vary depending upon several factors including
the premium, the type of coverage, and additional services provided to the client. Payment terms are consistent with current
industry practice.
Fiduciary Investment Income
Fiduciary investment income consists of interest earned on insurance premiums and surplus lines taxes that are held in a
fiduciary capacity, in cash and cash equivalents, until disbursed.
Expenses
Compensation and Benefits
Compensation and benefits is our largest expense. It consists of (i) salary, incentives and benefits to employees, and
commissions to our producers and (ii) equity-based compensation associated with the grants of awards to employees,
executive officers, and directors. We operate in competitive markets for human capital and we need to maintain
competitive compensation levels in order to maintain and grow our talent base.
General and Administrative
General and administrative expense includes travel and entertainment expenses, information technology, occupancy-related
expenses, foreign exchange, legal, insurance and other professional fees, and other costs associated with our operations. In
particular, our travel and entertainment expenses, information technology expenses, occupancy-related expenses, and
professional services expenses generally increase or decrease in relative proportion to the number of our employees and the
overall size and scale of our business operations.
Amortization
Amortization expense consists primarily of amortization related to intangible assets we acquired in connection with our
acquisitions. Intangible assets consist of customer relationships, trade names, assembled workforce, and internally-
developed software.
35
Interest Expense, Net
Interest expense, net consists of interest payable on indebtedness, amortization of the Company’s interest rate cap in 2025,
imputed interest on contingent consideration, and amortization of deferred debt issuance costs, offset by interest income on
the Company’s Cash and cash equivalents balances and payments received in relation to the interest rate cap, which
expired at the end of 2025.
Other Non-Operating Loss (Income)
For the six months ended June 30, 2026, Other non-operating loss (income) consisted of seller reimbursement of
acquisition-related retention incentives, sublease income, proceeds from the sale of a small non-subscription workers
compensation book of business, and forfeitures of vested equity awards offset by TRA contractual interest and related
charges. For the six months ended June 30, 2025, Other non-operating loss (income) consisted of seller reimbursement of
acquisition-related retention incentives and sublease income offset by TRA contractual interest and related charges.
Income Tax Expense
Income tax expense includes tax on the Company’s allocable share of any net taxable income from the LLC, from certain
state and local jurisdictions that impose taxes on partnerships, as well as earnings from our foreign subsidiaries and C-
Corporations subject to entity level taxation, and income tax expense recognized as a result of the Common Control
Reorganization (“CCR”) subsequent to the Velocity acquisition in the first quarter of 2025.
Non-Controlling Interests
Net income and Other comprehensive income (loss) are attributed to the non-controlling interests based on the weighted-
average LLC Common Units outstanding during the period and is presented on the Consolidated Statements of Income.
Refer to “Note 8, Stockholders’ Equity” of the unaudited quarterly consolidated financial statements for more information.
36
Results of Operations
Below is a summary table of the financial results and Non-GAAP measures that we find relevant to our business operations:
Three Months Ended June 30, | Change | Six Months Ended June 30, | Change | |||||||||||||
(in thousands, except percentages and per share data) | 2026 | 2025 | $ | % | 2026 | 2025 | $ | % | ||||||||
Revenue | ||||||||||||||||
Net commissions and fees | $902,728 | $840,857 | $61,871 | 7.4 % | $1,685,631 | $1,516,985 | $168,646 | 11.1 % | ||||||||
Fiduciary investment income | 13,919 | 14,313 | (394) | (2.8) | 26,245 | 28,351 | (2,106) | (7.4) | ||||||||
Total revenue | $916,647 | $855,170 | $61,477 | 7.2 % | $1,711,876 | $1,545,336 | $166,540 | 10.8 % | ||||||||
Expenses | ||||||||||||||||
Compensation and benefits | 531,617 | 485,272 | 46,345 | 9.6 | 1,026,793 | 915,561 | 111,232 | 12.1 | ||||||||
General and administrative | 118,643 | 107,049 | 11,594 | 10.8 | 227,404 | 213,109 | 14,295 | 6.7 | ||||||||
Amortization | 64,387 | 69,668 | (5,281) | (7.6) | 129,727 | 134,653 | (4,926) | (3.7) | ||||||||
Depreciation | 4,133 | 2,888 | 1,245 | 43.1 | 8,195 | 5,527 | 2,668 | 48.3 | ||||||||
Change in contingent consideration | 17,551 | (759) | 18,310 | NM | 44,845 | (14,801) | 59,646 | NM | ||||||||
Total operating expenses | $736,331 | $664,118 | $72,213 | 10.9 % | $1,436,964 | $1,254,049 | $182,915 | 14.6 % | ||||||||
Operating income | $180,316 | $191,052 | $(10,736) | (5.6 %) | $274,912 | $291,287 | $(16,375) | (5.6 %) | ||||||||
Interest expense, net | 56,649 | 58,334 | (1,685) | (2.9) | 110,382 | 112,842 | (2,460) | (2.2) | ||||||||
Income from equity method investments | (7,039) | (5,156) | (1,883) | 36.5 | (12,570) | (10,093) | (2,477) | 24.5 | ||||||||
Other non-operating loss (income) | (25) | 143 | (168) | NM | (736) | (234) | (502) | NM | ||||||||
Income before income taxes | $130,731 | $137,731 | $(7,000) | (5.1 %) | $177,836 | $188,772 | $(10,936) | (5.8 %) | ||||||||
Income tax expense | 22,350 | 13,026 | 9,324 | 71.6 | 28,858 | 68,456 | (39,598) | (57.8) | ||||||||
Net income | $108,381 | $124,705 | $(16,324) | (13.1 %) | $148,978 | $120,316 | $28,662 | 23.8 % | ||||||||
GAAP financial measures | ||||||||||||||||
Total revenue | $916,647 | $855,170 | $61,477 | 7.2 % | $1,711,876 | $1,545,336 | $166,540 | 10.8 % | ||||||||
Net commissions and fees | 902,728 | 840,857 | 61,871 | 7.4 | 1,685,631 | 1,516,985 | 168,646 | 11.1 | ||||||||
Compensation and benefits | 531,617 | 485,272 | 46,345 | 9.6 | 1,026,793 | 915,561 | 111,232 | 12.1 | ||||||||
General and administrative | 118,643 | 107,049 | 11,594 | 10.8 | 227,404 | 213,109 | 14,295 | 6.7 | ||||||||
Net income | 108,381 | 124,705 | (16,324) | (13.1) | 148,978 | 120,316 | 28,662 | 23.8 | ||||||||
Compensation and benefits expense ratio (1) | 58.0 % | 56.7 % | 60.0 % | 59.2 % | ||||||||||||
General and administrative expense ratio (2) | 12.9 % | 12.5 % | 13.3 % | 13.8 % | ||||||||||||
Net income margin (3) | 11.8 % | 14.6 % | 8.7 % | 7.8 % | ||||||||||||
Earnings per share (4) | $0.34 | $0.41 | $0.47 | $0.19 | ||||||||||||
Diluted earnings per share (4) | $0.33 | $0.38 | $0.45 | $0.18 | ||||||||||||
Non-GAAP financial measures* | ||||||||||||||||
Organic revenue growth rate | 6.7 % | 7.1 % | 8.9 % | 9.6 % | ||||||||||||
Adjusted compensation and benefits expense | $494,946 | $453,414 | $41,532 | 9.2% | $956,778 | $850,842 | $105,936 | 12.5% | ||||||||
Adjusted compensation and benefits expense ratio | 54.0 % | 53.0 % | 55.9 % | 55.1 % | ||||||||||||
Adjusted general and administrative expense | $94,797 | $93,350 | $1,447 | 1.6% | $196,162 | $185,587 | $10,575 | 5.7% | ||||||||
Adjusted general and administrative expense ratio | 10.3 % | 10.9 % | 11.5 % | 12.0 % | ||||||||||||
Adjusted EBITDAC | $326,904 | $308,406 | $18,498 | 6.0% | $558,937 | $508,907 | $50,030 | 9.8% | ||||||||
Adjusted EBITDAC margin | 35.7 % | 36.1 % | 32.7 % | 32.9 % | ||||||||||||
Adjusted net income | $198,731 | $184,682 | $14,049 | 7.6% | $329,460 | $292,521 | $36,939 | 12.6% | ||||||||
Adjusted net income margin | 21.7 % | 21.6 % | 19.2 % | 18.9 % | ||||||||||||
Adjusted diluted earnings per share | $0.74 | $0.66 | $0.08 | 12.1% | $1.22 | $1.05 | $0.17 | 16.2% | ||||||||
NM represents “Not Meaningful.”
(1)Compensation and benefits expense ratio is defined as Compensation and benefits expense divided by Total revenue.
(2)General and administrative expense ratio is defined as General and administrative expense divided by Total revenue.
(3)Net income margin is defined as Net income divided by Total revenue.
(4)See “Note 10, Earnings Per Share” of the unaudited quarterly consolidated financial statements for further discussion of
how these metrics are calculated.
37
*These measures are Non-GAAP. Please refer to the section entitled “Non-GAAP Financial Measures and Key Performance
Indicators” below for definitions and reconciliations to the most directly comparable GAAP measure.
Comparison of the Three Months Ended June 30, 2026 and 2025
Revenue
Total Revenue
Total revenue increased by $61.5 million, or 7.2%, from $855.2 million to $916.6 million for the three months ended June 30,
2026, as compared to the same period in the prior year. The following were the principal drivers of the increase:
•$53.7 million, or 6.3%, of the period-over-period change in Total revenue was due to organic revenue growth in
Net commissions and fees. Organic revenue growth represents the change in Net commissions and fees revenue,
as compared to the same period for the year prior, adjusted for Net commissions and fees attributable to recent
acquisitions during the first twelve months of Ryan Specialty’s ownership, and other adjustments such as the
removal of the impact of contingent commissions and the impact of changes in foreign exchange rates. In
aggregate, our net commission rates were consistent period-over-period. Also, we grew our client relationships,
in aggregate, within each of our three Specialties. The growth of these relationships is due to the combination of
the growing specialty and E&S markets and winning new business from competitors. We experienced growth
across the majority of our casualty lines offset by a moderate pullback across our property portfolio driven by a
continued decline in rates and retailers realizing additional opportunities to place coverage directly. This decline
was partially offset by strong new business generation and renewal retention. Growth in the quarter was most
pronounced in our Underwriting Management Specialty, with growth across our three Specialties driven by an
increase in the flow of risks into the specialty and E&S markets; and
•$11.0 million, or 1.3%, of the period-over-period change in Total revenue was due to acquisitions during their
first twelve months of ownership by the Company. Within acquisition revenue is a $0.4 million offset in
revenue period-over-period relating to the sale of a small non-subscription workers compensation book of
business at the end of 2024 and a small MGU in 2025.
•These increases were offset by a decline of $2.8 million, or 0.3%, of the period-over-period change in Total
revenue that was due to contingent commissions driven by the performance of risks placed on eligible business
earning profit-based commissions and the impact of foreign exchange rates on the Company’s Net commissions
and fees; and
•A decline of $0.4 million, or 0.1%, of the period-over-period change in Total revenue was due to a decrease in
Fiduciary investment income, caused by a decline in interest rates compared to the prior year period.
Three Months Ended June 30, | ||||||||||||
(in thousands, except percentages) | 2026 | % of total | 2025 | % of total | Change | |||||||
Wholesale Brokerage | $498,802 | 55.3 % | $477,165 | 56.7 % | $21,637 | 4.5 % | ||||||
Binding Authority | 100,170 | 11.1 | 94,524 | 11.2 | 5,646 | 6.0 | ||||||
Underwriting Management | 303,756 | 33.6 | 269,168 | 32.1 | 34,588 | 12.8 | ||||||
Total Net commissions and fees | $902,728 | $840,857 | $61,871 | 7.4 % | ||||||||
Wholesale Brokerage Net commissions and fees increased by $21.6 million, or 4.5%, period-over-period, primarily due to
organic growth within the Specialty for the quarter and contributions from the JM Wilson acquisition.
Binding Authority Net commissions and fees increased by $5.6 million, or 6.0%, period-over-period, primarily due to organic
growth within the Specialty for the quarter and contributions from the JM Wilson acquisition.
Underwriting Management Net commissions and fees increased by $34.6 million, or 12.8%, period-over-period, primarily
due to strong organic growth within the Specialty for the quarter and contributions from recent acquisitions.
38
The following table sets forth our revenue by type of commission and fees:
Three Months Ended June 30, | ||||||||||||
(in thousands, except percentages) | 2026 | % of total | 2025 | % of total | Change | |||||||
Net commissions and policy fees | $852,385 | 94.4 % | $787,074 | 93.6 % | $65,311 | 8.3 % | ||||||
Supplemental and contingent commissions | 32,168 | 3.6 | 35,630 | 4.2 | (3,462) | (9.7) | ||||||
Loss mitigation and other fees | 18,175 | 2.0 | 18,153 | 2.2 | 22 | 0.1 | ||||||
Total Net commissions and fees | $902,728 | $840,857 | $61,871 | 7.4 % | ||||||||
Net commissions and policy fees grew 8.3%, in line with the overall net commissions and fee revenue growth of 7.4%, for
the three months ended June 30, 2026, as compared to the same period in the prior year. The main drivers of this growth
continue to be new business wins and expansion of ongoing client relationships in response to the increasing demand for new,
complex specialty and E&S products, the inflow of risks from the Admitted market into the specialty and E&S markets, and
contributions from recent acquisitions. In aggregate, we experienced stable commission rates period-over-period.
Supplemental and contingent commissions declined 9.7% period-over-period driven by the performance of risks placed on
eligible business earning profit-based or volume-based commissions as well as contributions from recent acquisitions.
Loss mitigation and other fees increased 0.1% period-over-period primarily due to increased capital markets activity, captive
management, and other risk management service fees from the placement of alternative risk insurance solutions.
Expenses
Compensation and Benefits
Compensation and benefits expense increased by $46.3 million, or 9.6%, from $485.3 million to $531.6 million for the three
months ended June 30, 2026, compared to the same period in 2025. The following were the principal drivers of this increase:
•$31.4 million of the increase was driven by (i) the addition of 479 employees compared to the same period in
the prior year, inclusive of acquired employees, and (ii) growth in the business. Overall headcount increased to
6,171 full-time employees as of June 30, 2026, from 5,692 as of June 30, 2025;
•An $11.6 million increase in Restructuring and related expense due to the Empower Program. Compensation
and benefits restructuring costs include severance as well as employment costs for services rendered between
the notification and termination dates and other termination payments; and
•Commissions increased $11.5 million, or 5.1%, period-over-period, driven by the 4.5% increase in Wholesale
Brokerage and 6.0% increase in Binding Authority Net commissions and fees.
•The increases were partially offset by an $8.2 million decrease in Acquisition related long-term incentive
compensation related to the decline in acquisition activity compared to the prior period.
The net impact of revenue growth and the factors above resulted in a Compensation and benefits expense ratio increase of
1.3% from 56.7% to 58.0% period-over-period.
In general, we expect to continue experiencing a rise in commissions, salaries, incentives, and benefits expense
commensurate with our expected growth in business volume, revenue, and headcount.
General and Administrative
General and administrative expense increased by $11.6 million, or 10.8%, from $107.0 million to $118.6 million for the three
months ended June 30, 2026, as compared to the same period in the prior year. The following were the principal drivers of
this increase:
•A $21.8 million increase in Restructuring and related expense due to the Empower Program. Restructuring
expense within General and administrative expense includes costs relating to professional services, technology
39
and data initiatives, license fees, and third-party contractors, as well as non-cash expenses associated with the
impairment of internally-developed software; and
•A $3.5 million increase driven by growth in the business. Such expenses incurred to accommodate both organic
and inorganic revenue growth include travel and entertainment, information technology, occupancy, and
insurance.
•The increase was partially offset by an $11.6 million decline in Acquisition-related expense associated with
lower diligence, transaction-related, and integration activity in the period; and
•$2.1 million of foreign currency gains in the period associated with both the revaluation of reporting currencies
from foreign entities as well as foreign currency transactions during the period.
The net impact of revenue growth and the factors listed above resulted in a General and administrative expense ratio increase
of 0.4% from 12.5% to 12.9% period-over-period.
Amortization
Amortization expense decreased by $5.3 million from $69.7 million to $64.4 million for the three months ended June 30,
2026, compared to the same period in the prior year. The main driver of the decrease was that amortization of customer
relationships is recognized on an accelerated basis and declines over time. Our intangible assets decreased by $135.2 million
period-over-period.
Interest Expense, Net
Interest expense, net decreased $1.7 million, or 2.9%, from $58.3 million to $56.6 million for the three months ended
June 30, 2026, compared to the same period in the prior year. The main driver of the decrease in Interest expense, net for the
three months ended June 30, 2026, was a decrease in interest rates.
Other Non-Operating Loss (Income)
Other non-operating loss (income) increased by $0.1 million from a loss of $0.1 million to de minimis income for the three
months ended June 30, 2026. For the three months ended June 30, 2026, Other non-operating loss (income) consisted of $0.1
million of sublease income, $0.1 million of proceeds from the sale of a small non-subscription workers compensation book of
business, $0.1 million of forfeitures of vested equity awards, and de minimis seller reimbursement of acquisition-related
retention incentives offset by $0.4 million of TRA contractual interest and related charges. For the three months ended June
30, 2025, Other non-operating loss (income) consisted of $0.4 million of TRA contractual interest and related charges offset
by $0.2 million of sublease income.
Income Before Income Taxes
Income before income taxes decreased $7.0 million from $137.7 million to $130.7 million for the three months ended
June 30, 2026, compared to the same period in the prior year as a result of the factors described above.
Income Tax Expense
Income tax expense increased $9.3 million from $13.0 million to $22.4 million for the three months ended June 30, 2026,
compared to the same period in the prior year. The increase was primarily a result of a $5.2 million decrease in the discrete
benefit from a decline in the fair value of vested equity compensation period-over-period.
Net Income
Net income decreased $16.3 million from $124.7 million to $108.4 million for the three months ended June 30, 2026,
compared to the same period in the prior year as a result of the factors described above.
40
Comparison of the Six Months Ended June 30, 2026 and 2025
Revenue
Total Revenue
Total revenue increased by $166.5 million, or 10.8 %, from $1,545.3 million to $1,711.9 million for the six months ended
June 30, 2026, as compared to the same period in the prior year. The following were the principal drivers of the increase:
•$130.2 million, or 8.4%, of the period-over-period change in Total revenue was due to organic revenue
growth in Net commissions and fees. Organic revenue growth represents the change in Net commissions and
fees revenue, as compared to the same period for the year prior, adjusted for Net commissions and fees
attributable to recent acquisitions during the first twelve months of Ryan Specialty’s ownership, and other
adjustments such as the removal of the impact of contingent commissions and the impact of changes in
foreign exchange rates. In aggregate, our net commission rates were consistent period-over-period. Also, we
grew our client relationships, in aggregate, within each of our three Specialties. The growth of these
relationships is due to the combination of the growing specialty and E&S markets and winning new business
from competitors. We experienced growth across the majority of our casualty lines offset by a moderate
pullback across our property portfolio driven by a continued decline in rates and retailers realizing additional
opportunities to place coverage directly. This decline was partially offset by strong new business generation
and renewal retention. Growth in the period was most pronounced in our Underwriting Management
Specialty, with growth across our three Specialties driven by an increase in the flow of risks into the specialty
and E&S markets;
•$25.5 million, or 1.7%, of the period-over-period change in Total revenue was due to acquisitions during their
first twelve months of ownership by the Company. Within acquisition revenue is a $1.1 million offset in
revenue period-over-period relating to the sale of a small non-subscription workers compensation book of
business at the end of 2024 and a small MGU in 2025; and
•$12.9 million, or 0.8%, of the period-over-period change in Total revenue was due to contingent commissions
driven by the performance of risks placed on eligible business earning profit-based commissions and the
impact of foreign exchange rates on the Company’s Net commissions and fees.
•These increases were offset by a decline of $2.1 million, or 0.1%, of the period-over-period change in Total
revenue was due to a decrease in Fiduciary investment income, caused by a decline in interest rates compared
to the prior year period.
Six Months Ended June 30, | ||||||||||||
(in thousands, except percentages) | 2026 | % of total | 2025 | % of total | Change | |||||||
Wholesale Brokerage | $876,598 | 52.0 % | $837,953 | 55.2 % | $38,645 | 4.6 % | ||||||
Binding Authority | 210,170 | 12.5 | 196,474 | 13.0 | 13,696 | 7.0 | ||||||
Underwriting Management | 598,863 | 35.5 | 482,558 | 31.8 | 116,305 | 24.1 | ||||||
Total Net commissions and fees | $1,685,631 | $1,516,985 | $168,646 | 11.1 % | ||||||||
Wholesale Brokerage Net commissions and fees increased by $38.6 million, or 4.6 %, period-over-period, primarily due to
organic growth within the Specialty for the quarter and contributions from the JM Wilson acquisition.
Binding Authority Net commissions and fees increased by $13.7 million, or 7.0 %, period-over-period, primarily due to
organic growth within the Specialty for the quarter and contributions from the JM Wilson acquisition.
Underwriting Management Net commissions and fees increased by $116.3 million, or 24.1 %, period-over-period,
primarily due to strong organic growth within the Specialty for the quarter, and contributions from recent acquisitions.
41
The following table sets forth our revenue by type of commission and fees:
Six Months Ended June 30, | ||||||||||||
(in thousands, except percentages) | 2026 | % of total | 2025 | % of total | Change | |||||||
Net commissions and policy fees | $1,569,937 | 93.1 % | $1,411,040 | 93.0 % | $158,897 | 11.3 % | ||||||
Supplemental and contingent commissions | 81,285 | 4.8 | 73,403 | 4.8 | 7,882 | 10.7 | ||||||
Loss mitigation and other fees | 34,409 | 2.1 | 32,542 | 2.2 | 1,867 | 5.7 | ||||||
Total Net commissions and fees | $1,685,631 | $1,516,985 | $168,646 | 11.1 % | ||||||||
Net commissions and policy fees grew 11.3 %, in line with the overall net commissions and fee revenue growth of 11.1 %,
for the six months ended June 30, 2026, as compared to the same period in the prior year. The main drivers of this growth
continue to be new business wins and expansion of ongoing client relationships in response to the increasing demand for
new, complex specialty and E&S products, the inflow of risks from the Admitted market into the specialty and E&S
markets, and contributions from recent acquisitions. In aggregate, we experienced stable commission rates period-over-
period.
Supplemental and contingent commissions increased 10.7 % period-over-period driven by the performance of risks placed
on eligible business earning profit-based or volume-based commissions as well as contributions from recent acquisitions.
Loss mitigation and other fees increased 5.7 % period-over-period primarily due to increased capital markets activity,
captive management and other risk management service fees from the placement of alternative risk insurance solutions, as
well as contributions from recent acquisitions.
Expenses
Compensation and Benefits
Compensation and benefits expense increased by $111.2 million, or 12.1 %, from $915.6 million to $1,026.8 million for
the six months ended June 30, 2026, compared to the same period in 2025. The following were the principal drivers of this
increase:
•$78.2 million of the increase was driven by (i) the addition of 479 employees compared to the same period in
the prior year, inclusive of acquired employees, and (ii) growth in the business. Overall headcount increased
to 6,171 full-time employees as of June 30, 2026, from 5,692 as of June 30, 2025;
•Commissions increased $26.2 million, or 6.4%, period-over-period, driven by the 4.6% increase in Wholesale
Brokerage and 7.0% increase in Binding Authority Net commissions and fees; and
•A $14.1 million increase in Restructuring and related expense due to the Empower Program. Compensation
and benefits restructuring costs include severance as well as employment costs for services rendered between
the notification and termination dates and other termination payments.
•The increases were partially offset by a $7.3 million decline in Acquisition-related expense associated with
lower diligence, transaction-related, and integration activity in the period.
The net impact of revenue growth and the factors above resulted in a Compensation and benefits expense ratio increase of
0.8% from 59.2% to 60.0% period-over-period.
In general, we expect to continue experiencing a rise in commissions, salaries, incentives, and benefits expense
commensurate with our expected growth in business volume, revenue, and headcount.
General and Administrative
General and administrative expense increased by $14.3 million, or 6.7 %, from $213.1 million to $227.4 million for the six
months ended June 30, 2026, as compared to the same period in the prior year. The following were the principal drivers of
this increase:
•A $25.2 million increase in Restructuring and related expense due to the Empower Program. Restructuring
expense within General and administrative expense includes costs relating to professional services,
42
technology and data initiatives, license fees, and third-party contractors, as well as non-cash expenses
associated with the impairment of internally-developed software; and
•A $10.6 million increase was driven by growth in the business. Such expenses incurred to accommodate both
organic and inorganic revenue growth include travel and entertainment, information technology, occupancy,
insurance, and foreign exchange.
•The increases were partially offset by a $21.5 million decline in Acquisition-related expense associated with
lower diligence, transaction-related, and integration activity in the period.
The net impact of revenue growth and the factors listed above resulted in a General and administrative expense ratio
decrease of 0.5% from 13.8% to 13.3% period-over-period.
Amortization
Amortization expense decreased by $5.0 million from $134.7 million to $129.7 million for the six months ended June 30,
2026, compared to the same period in the prior year. The main driver of the decrease was that amortization of customer
relationships is recognized on an accelerated basis and declines over time. Our intangible assets decreased by $135.2
million period-over-period.
Interest Expense, Net
Interest expense, net decreased $2.4 million, or 2.2%, from $112.8 million to $110.4 million for the six months ended
June 30, 2026, compared to the same period in the prior year. The main driver of the decrease in Interest expense, net for
the six months ended June 30, 2026, was a decrease in interest rates.
Other Non-Operating Loss (Income)
Other non-operating loss (income) increased by $0.5 million to income of $0.7 million for the six months ended June 30,
2026, as compared to income of $0.2 million in the same period in the prior year. For the six months ended June 30, 2026,
Other non-operating loss (income) consisted of $0.6 million of forfeitures of vested equity awards, $0.3 million of sublease
income, $0.1 million of proceeds from the sale of a small non-subscription workers compensation book of business, and
$0.1 million of seller reimbursement of acquisition-related retention incentives offset by $0.4 million of TRA contractual
interest and related charges. For the six months ended June 30, 2025, Other non-operating loss (income) consisted of $0.3
million of seller reimbursement of acquisition-related retention incentives and $0.3 million of sublease income offset by
$0.4 million of TRA contractual interest and related charges.
Income Before Income Taxes
Income before income taxes decreased $11.0 million from $188.8 million to $177.8 million for the six months ended
June 30, 2026, compared to the same period in the prior year as a result of the factors described above.
Income Tax Expense
Income tax expense decreased $39.6 million from $68.5 million to $28.9 million for the six months ended June 30, 2026,
compared to the same period in the prior year primarily as a result of $48.0 million of income tax expense recognized as a
result of the CCR subsequent to the Velocity acquisition in the first quarter of 2025 offset by a $5.6 million decrease in the
discrete benefit from a decline in the fair value of vested equity compensation period-over-period in the period.
Net Income
Net income increased $28.7 million from $120.3 million to $149.0 million for the six months ended June 30, 2026,
compared to the same period in the prior year as a result of the factors described above.
Non-GAAP Financial Measures and Key Performance Indicators
In assessing the performance of our business, we use non-GAAP financial measures that are derived from our consolidated
financial information, but which are not presented in our consolidated financial statements prepared in accordance with
GAAP. We consider these non-GAAP financial measures to be useful metrics for management and investors to facilitate
operating performance comparisons from period to period by excluding potential differences caused by variations in capital
structures, tax positions, depreciation, amortization, and certain other items that we believe are not representative of our
core business. We use the following non-GAAP measures for business planning purposes, in measuring our performance
relative to that of our competitors, to help investors to understand the nature of our growth, and to enable investors to
evaluate the run-rate performance of the Company. Non-GAAP financial measures should be viewed as supplementing,
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and not as an alternative or substitute for, the consolidated financial statements prepared and presented in accordance with
GAAP. The footnotes to the reconciliation tables below should be read in conjunction with the unaudited consolidated
quarterly financial statements. Industry peers may provide similar supplemental information but may not define similarly
named metrics in the same way we do and may not make identical adjustments.
Organic Revenue Growth Rate
Organic revenue growth rate is defined as the percentage change in Net commissions and fees, as compared to the same
period for the prior year, adjusted to eliminate revenue attributable to acquisitions for the first twelve months of ownership,
revenue attributable to sold businesses for the subsequent twelve months after the sale, and other items such as contingent
commissions and the impact of changes in foreign exchange rates.
For the avoidance of doubt, prior period references in the tables below represent the same period in the prior year. A
reconciliation of Organic revenue growth rate to Net commissions and fees growth rate, the most directly comparable
GAAP measure, for each of the periods indicated is as follows (in percentages):
Three Months Ended June 30, | Six Months Ended June 30, | ||||||
(in thousands, except percentages) | 2026 | 2025 | 2026 | 2025 | |||
Current period Net commissions and fees revenue | $902,728 | $840,857 | $1,685,631 | $1,516,985 | |||
Less: Current period contingent commissions | (24,149) | (27,392) | (66,522) | (57,854) | |||
Less: Revenue attributable to sold businesses | (79) | (144) | (92) | (290) | |||
Net commissions and fees revenue excluding contingent commissions | $878,500 | $813,321 | $1,619,017 | $1,458,841 | |||
Prior period Net commissions and fees revenue | $840,857 | $680,248 | $1,516,985 | $1,218,135 | |||
Less: Prior year contingent commissions | (27,392) | (5,396) | (57,854) | (29,899) | |||
Less: Revenue attributable to sold businesses | (524) | (581) | (1,181) | (1,120) | |||
Prior period Net commissions and fees revenue excluding contingent commissions | $812,941 | $674,270 | $1,457,950 | $1,187,116 | |||
Change in Net commissions and fees revenue excluding contingent commissions | $65,559 | $139,051 | $161,067 | $271,725 | |||
Less: Mergers and acquisitions Net commissions and fees revenue excluding contingent commissions | (11,430) | (89,419) | (26,675) | (156,597) | |||
Impact of change in foreign exchange rates | (389) | (1,203) | (4,238) | (952) | |||
Organic revenue growth (Non-GAAP) | $53,740 | $48,429 | $130,154 | $114,176 | |||
Net commissions and fees revenue growth rate (GAAP) | 7.4 % | 23.6 % | 11.1 % | 24.5 % | |||
Less: Impact of contingent commissions (1) | 0.7 | (3.0) | (0.1) | (1.6) | |||
Net commissions and fees revenue excluding contingent commissions growth rate (2) | 8.1 % | 20.6 % | 11.0 % | 22.9 % | |||
Less: Mergers and acquisitions Net commissions and fees revenue excluding contingent commissions (3) | (1.4) | (13.3) | (1.8) | (13.2) | |||
Impact of change in foreign exchange rates (4) | — | (0.2) | (0.3) | (0.1) | |||
Organic Revenue Growth Rate (Non-GAAP) | 6.7 % | 7.1 % | 8.9 % | 9.6 % | |||
(1)Calculated by subtracting Net commissions and fees revenue growth rate from net commissions and fees revenue
excluding contingent commissions growth rate and revenue from sold businesses.
(2)Calculated by dividing the change in Total net commissions & fees revenue excluding contingent commissions by prior
year net commissions and fees excluding contingent commissions and revenue from sold businesses.
(3)Calculated by taking the mergers and acquisitions net commissions and fees revenue excluding contingent
commissions, representing the first 12 months of net commissions and fees revenue generated from acquisitions,
44
divided by prior period net commissions and fees revenue excluding contingent commissions and revenue from sold
businesses.
(4)Calculated by taking the change in foreign exchange rates divided by prior period net commissions and fees revenue
excluding contingent commissions and revenue from sold businesses.
Adjusted Compensation and Benefits Expense and Adjusted Compensation and Benefits Expense Ratio
We define Adjusted compensation and benefits expense as Compensation and benefits expense adjusted to reflect items
such as (i) equity-based compensation, (ii) acquisition and restructuring related compensation expense, and (iii) other
exceptional or non-recurring items, as applicable. The most comparable GAAP financial metric is Compensation and
benefits expense. Adjusted compensation and benefits expense ratio is defined as Adjusted compensation and benefits
expense as a percentage of Total revenue. The most comparable GAAP financial metric is Compensation and benefits
expense ratio.
A reconciliation of Adjusted compensation and benefits expense and Adjusted compensation and benefits expense ratio to
Compensation and benefits expense and Compensation and benefits expense ratio, the most directly comparable GAAP
measures, for each of the periods indicated, is as follows:
Three Months Ended June 30, | Six Months Ended June 30, | |||||||
(in thousands, except percentages) | 2026 | 2025 | 2026 | 2025 | ||||
Total revenue | $916,647 | $855,170 | $1,711,876 | $1,545,336 | ||||
Compensation and benefits expense | $531,617 | $485,272 | $1,026,793 | $915,561 | ||||
Acquisition-related expense | (1,849) | (1,484) | (5,260) | (4,963) | ||||
Acquisition related long-term incentive compensation | (1,107) | (9,321) | (10,394) | (17,652) | ||||
Restructuring and related expense | (11,634) | — | (14,099) | — | ||||
Amortization and expense related to discontinued prepaid incentives | (692) | (1,128) | (1,522) | (2,306) | ||||
Equity-based compensation | (18,411) | (14,853) | (32,720) | (29,422) | ||||
Initial public offering related expense | (2,978) | (5,072) | (6,020) | (10,376) | ||||
Adjusted compensation and benefits expense (1) | $494,946 | $453,414 | $956,778 | $850,842 | ||||
Compensation and benefits expense ratio | 58.0 % | 56.7 % | 60.0 % | 59.2 % | ||||
Adjusted compensation and benefits expense ratio | 54.0 % | 53.0 % | 55.9 % | 55.1 % | ||||
(1)Adjustments to Compensation and benefits expense are described in the definition of Adjusted EBITDAC to Net
income in “Adjusted EBITDAC and Adjusted EBITDAC Margin.”
Adjusted General and Administrative Expense and Adjusted General and Administrative Expense Ratio
We define Adjusted general and administrative expense as General and administrative expense adjusted to reflect items
such as (i) acquisition and restructuring general and administrative related expense and (ii) other exceptional or non-
recurring items, as applicable. The most comparable GAAP financial metric is General and administrative expense.
Adjusted general and administrative expense ratio is defined as Adjusted general and administrative expense as a
percentage of Total revenue. The most comparable GAAP financial metric is General and administrative expense ratio.
45
A reconciliation of Adjusted general and administrative expense and Adjusted general and administrative expense ratio to
General and administrative expense and General and administrative expense ratio, the most directly comparable GAAP
measures, for each of the periods indicated is as follows:
(1)Adjustments to General and administrative expense are described in the definition of Adjusted EBITDAC to Net
income in “Adjusted EBITDAC and Adjusted EBITDAC Margin.”
Adjusted EBITDAC and Adjusted EBITDAC Margin
We define Adjusted EBITDAC as Net income before Interest expense, net, Income tax expense, Depreciation,
Amortization, and Change in contingent consideration, adjusted to reflect items such as (i) equity-based compensation, (ii)
acquisition and restructuring related expenses, and (iii) other exceptional or non-recurring items, as applicable.
Acquisition-related expense includes one-time diligence, transaction-related, and integration costs. Acquisition related
long-term incentive compensation arises from long-term incentive plans associated with acquisitions. These plans require
service requirements, and in some cases performance targets, to be met in order to be earned. Restructuring and related
expense consists of compensation and benefits, contractors, professional services, and license fees related to the Empower
Program, which was initiated at the beginning of 2026. Restructuring expense within general and administrative expense
includes costs relating to professional services, technology and data initiatives, license fees, and third-party contractors, as
well as non-cash expenses associated with the impairment of internally-developed software. Compensation and benefits
restructuring costs include severance as well as employment costs for services rendered between the notification and
termination dates and other termination payments. Amortization and expense is composed of charges related to
discontinued prepaid incentive programs. For the three months ended June 30, 2026, Other non-operating loss (income)
consisted of $0.1 million of sublease income, $0.1 million of proceeds from the sale of a small non-subscription workers
compensation book of business, $0.1 million of forfeitures of vested equity awards, and de minimis seller reimbursement
of acquisition-related retention incentives offset by $0.4 million of TRA contractual interest and related charges. For the
three months ended June 30, 2025, Other non-operating loss (income) consisted of $0.4 million of TRA contractual interest
and related charges offset by $0.2 million of sublease income. For the six months ended June 30, 2026, Other non-
operating loss (income) consisted of $0.6 million of forfeitures of vested equity awards, $0.3 million of sublease income,
$0.1 million of proceeds from the sale of a small non-subscription workers compensation book of business, and $0.1
million of seller reimbursement of acquisition-related retention incentives offset by $0.4 million of TRA contractual
interest and related charges. For the six months ended June 30, 2025, Other non-operating loss (income) consisted of $0.3
million of seller reimbursement of acquisition-related retention incentives and $0.3 million of sublease income offset by
$0.4 million of TRA contractual interest and related charges. Equity-based compensation reflects non-cash equity-based
expense. IPO related expenses consist of compensation-related expense primarily related to the expense for new awards
issued at IPO as well as expense related to the revaluation of existing equity awards at IPO.
Total revenue less Adjusted compensation and benefits expense and Adjusted general and administrative expense is
equivalent to Adjusted EBITDAC. For a breakout of compensation and general and administrative costs for each addback,
refer to the Adjusted compensation and benefits expense and Adjusted general and administrative expense tables above.
The most directly comparable GAAP financial metric to Adjusted EBITDAC is Net income. Adjusted EBITDAC margin is
defined as Adjusted EBITDAC as a percentage of Total revenue. The most comparable GAAP financial metric is Net
income margin.
46
A reconciliation of Adjusted EBITDAC and Adjusted EBITDAC margin to Net income and Net income margin, the most
directly comparable GAAP measures, for each of the periods indicated is as follows:
Three Months Ended June 30, | Six Months Ended June 30, | |||||||
(in thousands, except percentages) | 2026 | 2025 | 2026 | 2025 | ||||
Total revenue | $916,647 | $855,170 | $1,711,876 | $1,545,336 | ||||
Net income | $108,381 | $124,705 | $148,978 | $120,316 | ||||
Interest expense, net | 56,649 | 58,334 | 110,382 | 112,842 | ||||
Income tax expense | 22,350 | 13,026 | 28,858 | 68,456 | ||||
Depreciation | 4,133 | 2,888 | 8,195 | 5,527 | ||||
Amortization | 64,387 | 69,668 | 129,727 | 134,653 | ||||
Change in contingent consideration (1) | 17,551 | (759) | 44,845 | (14,801) | ||||
EBITDAC | $273,451 | $267,862 | $470,985 | $426,993 | ||||
Acquisition-related expense | 3,903 | 15,183 | 11,305 | 32,485 | ||||
Acquisition related long-term incentive compensation | 1,107 | 9,321 | 10,394 | 17,652 | ||||
Restructuring and related expense | 33,426 | — | 39,297 | — | ||||
Amortization and expense related to discontinued prepaid incentives | 692 | 1,128 | 1,522 | 2,306 | ||||
Other non-operating loss (income) | (25) | 143 | (736) | (234) | ||||
Equity-based compensation | 18,411 | 14,853 | 32,720 | 29,422 | ||||
IPO related expenses | 2,978 | 5,072 | 6,020 | 10,376 | ||||
Income from equity method investments | (7,039) | (5,156) | (12,570) | (10,093) | ||||
Adjusted EBITDAC | $326,904 | $308,406 | $558,937 | $508,907 | ||||
Net income margin | 11.8 % | 14.6 % | 8.7 % | 7.8 % | ||||
Adjusted EBITDAC margin | 35.7 % | 36.1 % | 32.7 % | 32.9 % | ||||
(1)For the six months ended June 30, 2025, Change in contingent consideration included a $20.3 million decrease in
valuation of the US Assure contingent consideration as a result of increased loss ratios impacting projected profit
commissions.
Adjusted Net Income and Adjusted Net Income Margin
We define Adjusted net income as tax-effected earnings before amortization and certain items of income and expense,
gains and losses, equity-based compensation, acquisition related long-term incentive compensation, acquisition-related
expenses, costs associated with the IPO, and certain exceptional or non-recurring items. The most comparable GAAP
financial metric is Net income. Adjusted net income margin is calculated as Adjusted net income as a percentage of Total
revenue. The most comparable GAAP financial metric is Net income margin.
Following the IPO, the Company is subject to United States federal income taxes, in addition to state, local, and foreign
taxes, with respect to our allocable share of any net taxable income of the LLC. For comparability purposes, this
calculation incorporates the impact of federal and state statutory tax rates on 100% of our adjusted pre-tax income as if the
Company owned 100% of the LLC.
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A reconciliation of Adjusted net income and Adjusted net income margin to Net income and Net income margin, the most
directly comparable GAAP measures, for each of the periods indicated is as follows:
Three Months Ended June 30, | Six Months Ended June 30, | |||||||
(in thousands, except percentages) | 2026 | 2025 | 2026 | 2025 | ||||
Total revenue | $916,647 | $855,170 | $1,711,876 | $1,545,336 | ||||
Net income | $108,381 | $124,705 | $148,978 | $120,316 | ||||
Income tax expense | 22,350 | 13,026 | 28,858 | 68,456 | ||||
Amortization | 64,387 | 69,668 | 129,727 | 134,653 | ||||
Amortization of deferred debt issuance costs (1) | 2,434 | 2,386 | 4,856 | 4,760 | ||||
Change in contingent consideration | 17,551 | (759) | 44,845 | (14,801) | ||||
Acquisition-related expense | 3,903 | 15,183 | 11,305 | 32,485 | ||||
Acquisition related long-term incentive compensation | 1,107 | 9,321 | 10,394 | 17,652 | ||||
Restructuring and related expense | 33,426 | — | 39,297 | — | ||||
Amortization and expense related to discontinued prepaid incentives | 692 | 1,128 | 1,522 | 2,306 | ||||
Other non-operating loss (income) | (25) | 143 | (736) | (234) | ||||
Equity-based compensation | 18,411 | 14,853 | 32,720 | 29,422 | ||||
IPO related expenses | 2,978 | 5,072 | 6,020 | 10,376 | ||||
Income from equity method investments | (7,039) | (5,156) | (12,570) | (10,093) | ||||
Adjusted income before income taxes (2) | $268,556 | $249,570 | $445,216 | $395,298 | ||||
Adjusted income tax expense (3) | (69,825) | (64,888) | (115,756) | (102,777) | ||||
Adjusted net income | $198,731 | $184,682 | $329,460 | $292,521 | ||||
Net income margin | 11.8 % | 14.6 % | 8.7 % | 7.8 % | ||||
Adjusted net income margin | 21.7 % | 21.6 % | 19.2 % | 18.9 % | ||||
(1)Interest expense, net includes amortization of deferred debt issuance costs.
(2)Adjustments to Net income are described in the definition of Adjusted EBITDAC to Net income in “Adjusted
EBITDAC and Adjusted EBITDAC Margin.”
(3)The Company is subject to United States federal income taxes, in addition to state, local, and foreign taxes, with respect
to our allocable share of any net taxable income of the LLC. For the three and six months ended June 30, 2026 and
2025, this calculation of adjusted income tax expense is based on a federal statutory rate of 21% and a combined state
income tax rate net of federal benefits of 5.00% on 100% of our adjusted income before income taxes as if the
Company owned 100% of the LLC.
Adjusted Diluted Earnings Per Share
We define Adjusted diluted earnings per share as Adjusted net income divided by diluted shares outstanding after adjusting
for the effect if 100% of the outstanding LLC Common Units (together with the shares of Class B common stock), vested
Class C Incentive Units, vested but unexercised Options, and unvested equity awards were exchanged into shares of Class
A common stock as if 100% of unvested equity awards were vested. The most directly comparable GAAP financial metric
is Diluted earnings per share.
48
A reconciliation of Adjusted diluted earnings per share to Diluted earnings per share, the most directly comparable GAAP
measure, for each of the periods indicated is as follows:
Three Months Ended June 30, | Six Months Ended June 30, | |||||||
2026 | 2025 | 2026 | 2025 | |||||
Earnings per share of Class A common stock – diluted | $0.33 | $0.38 | $0.45 | $0.18 | ||||
Less: Net income attributed to dilutive shares (1) | (0.01) | (0.19) | — | — | ||||
Plus: Impact of all LLC Common Units exchanged for Class A shares (2) | 0.09 | 0.26 | 0.10 | 0.26 | ||||
Plus: Adjustments to Adjusted net income (3) | 0.34 | 0.22 | 0.68 | 0.63 | ||||
Plus: Dilutive impact of unvested equity awards (4) | (0.01) | (0.01) | (0.01) | (0.02) | ||||
Adjusted diluted earnings per share | $0.74 | $0.66 | $1.22 | $1.05 | ||||
(Share count in ’000) | ||||||||
Weighted-average shares of Class A common stock outstanding – diluted | 131,326 | 274,145 | 134,322 | 138,167 | ||||
Plus: Impact of all LLC Common Units exchanged for Class A shares (2) | 134,190 | — | 134,332 | 135,804 | ||||
Plus: Dilutive impact of unvested equity awards (4) | 3,867 | 5,275 | 1,426 | 5,422 | ||||
Adjusted diluted earnings per share diluted share count | 269,383 | 279,420 | 270,080 | 279,393 | ||||
(1)Adjustment removes the impact of Net income attributed to dilutive awards to arrive at Net income attributable to Ryan
Specialty Holdings, Inc. For the three months ended June 30, 2026 and 2025, this removes $0.5 million and $52.4
million of Net income, respectively, on 131.3 million and 274.1 million Weighted-average shares of Class A common
stock outstanding - diluted, respectively. For the six months ended June 30, 2026 and 2025, this removes $0.5 million
and $1.1 million of Net income, respectively, on 134.3 million and 138.2 million Weighted-average shares of Class A
common stock outstanding - diluted, respectively. See “Note 10, Earnings Per Share” of the unaudited quarterly
consolidated financial statements.
(2)For comparability purposes, this calculation incorporates the Net income that would be distributable if all LLC
Common Units (together with shares of Class B common stock) were exchanged for shares of Class A common stock.
For the three months ended June 30, 2026 and 2025, this includes $66.1 million and $72.7 million of Net income,
respectively, on 265.5 million and 274.1 million Weighted-average shares of Class A common stock outstanding -
diluted, respectively. For the three months ended June 30, 2025, 135.5 million weighted-average outstanding LLC
Common Units were considered dilutive and included in the 274.1 million Weighted-average shares of Class A
common stock outstanding - diluted within Diluted EPS. For the six months ended June 30, 2026 and 2025, this
includes $89.0 million and $96.0 million of Net income, respectively, on 268.7 million and 274.0 million Weighted-
average shares of Class A common stock outstanding - diluted, respectively. See “Note 10, Earnings Per Share” of the
unaudited quarterly consolidated financial statements.
(3)Adjustments to Adjusted net income are described in the footnotes of the reconciliation of Adjusted net income to Net
income in “Adjusted Net Income and Adjusted Net Income Margin” on 265.5 million and 274.1 million Weighted-
average shares of Class A common stock outstanding - diluted for the three months ended June 30, 2026 and 2025,
respectively, and 268.7 million and 274.0 million Weighted-average shares of Class A common stock outstanding -
diluted for the six months ended June 30, 2026 and 2025, respectively.
(4)For comparability purposes and to be consistent with the treatment of the adjustments to arrive at Adjusted net income,
the dilutive effect of 100% of the outstanding LLC Common Units (together with shares of Class B common stock),
vested Class C Incentive Units, vested but unexercised options, and unvested equity awards calculated using the
treasury stock method as if the weighted-average unrecognized cost associated with the awards was $0 over the period,
less any unvested equity awards determined to be dilutive within the Diluted EPS calculation disclosed in “Note 10,
Earnings Per Share” of the unaudited quarterly consolidated financial statements. For the three months ended June 30,
2026 and 2025, 3.9 million and 5.3 million shares were added to the calculation, respectively. For the six months ended
June 30, 2026 and 2025, 1.4 million and 5.4 million shares were added to the calculation, respectively.
49
Liquidity and Capital Resources
Liquidity describes the ability of a company to generate sufficient cash flows to meet the cash requirements of its business
operations. We believe that the balance sheet and strong cash flow profile of our business provides adequate liquidity. The
primary sources of liquidity are Cash and cash equivalents on the Consolidated Balance Sheets, cash flows provided by
operations, and debt capacity available under our Revolving Credit Facility, Term Loan, and Senior Secured Notes. The
primary uses of liquidity are operating expenses, seasonal working capital needs, business combinations, capital
expenditures, obligations under the TRA, taxes, distributions to LLC Unitholders, share repurchases, and dividends to
Class A common stockholders. We believe that Cash and cash equivalents, cash flows from operations, and amounts
available under our Revolving Credit Facility will be sufficient to meet liquidity needs, including principal and interest
payments on debt obligations, capital expenditures, and anticipated working capital requirements, for the next 12 months
and beyond. Our future capital requirements will depend on many factors including continuance of historical working
capital levels and capital expenditure needs, investment in de novo offerings, and the flow of deals in our merger and
acquisition program.
On February 12, 2026, our Board declared a regular quarterly dividend of $0.13 per share on our outstanding Class A
common stock. $0.07 of the regular quarterly dividend was funded by current and prior tax distributions from the LLC that
are in excess of both the corporate income taxes payable by the Company as well as the Company’s obligations pursuant to
the Tax Receivable Agreement. The remaining $0.06 of the regular quarterly dividend was funded by free cash flow from
the LLC and paid to all holders of the Class A common stock and LLC Common Units.
On May 21, 2026, our Board approved an increase of $300 million to the share repurchase program that authorizes the
Company to repurchase up to $600 million of its outstanding Class A common stock. Share repurchases may be made from
time to time on the open market, in privately negotiated transactions, using Rule 10b5-1 trading plans, as accelerated share
repurchases, or in any other manner that complies with the applicable securities law. The timing of repurchases and the
number of shares repurchased under the program will depend upon a variety of factors including the Company’s stock
price, trading volume, working capital or other liquidity requirements, and market conditions. The Company is not
obligated to repurchase any shares under the program and the program may be suspended or discontinued at any time
without notice.
We may be required to seek additional equity or debt financing. In the event that additional financing is required from
outside sources, we may not be able to raise it on terms acceptable to us or at all. If we are unable to raise additional capital
or generate cash flows necessary to expand our operations, this could reduce our ability to compete successfully and harm
the results of our operations.
Cash and cash equivalents on the Consolidated Balance Sheets include funds available for general corporate purposes.
Fiduciary cash and receivables cannot be used for general corporate purposes. Insurance premiums, claims funds, and
surplus lines taxes are held in a fiduciary capacity and the obligation to remit these funds are recorded as Fiduciary
liabilities on the Consolidated Balance Sheets. We recognize fiduciary amounts due to others as Fiduciary liabilities and
fiduciary amounts collectible and held on behalf of others, including insurance carriers, other insurance intermediaries,
surplus lines taxing authorities, clients, and insurance policy holders, as Fiduciary cash and receivables on the Consolidated
Balance Sheets.
In our capacity as an insurance broker or agent, we collect premiums from insureds and, after deducting our commission,
remit the premiums to the respective insurance markets and carriers. We also collect claims prefunding or refunds from
carriers on behalf of insureds, which are then returned to the insureds, and surplus lines taxes, which are then remitted to
surplus lines taxing authorities. Insurance premiums, claims funds, and surplus lines taxes are held in a fiduciary capacity.
The levels of Fiduciary cash and receivables and Fiduciary liabilities can fluctuate significantly depending on when we
collect the premiums, claims prefunding, and refunds, make payments to markets, carriers, surplus lines taxing authorities,
and insureds, and collect funds from clients and make payments on their behalf, and upon the impact of foreign currency
movements. Fiduciary cash, because of its nature, is held in very liquid securities with a focus on preservation of principal.
To minimize counterparty investment risk, we maintain cash holdings pursuant to a fiduciary holdings policy which
contemplates all relevant rules established by states with regard to fiduciary cash and is approved by our Board of
Directors. The policy requires broad diversification of holdings across a variety of counterparties utilizing limits set by our
Board of Directors, primarily based on credit rating and type of investment. Fiduciary cash and receivables included cash
of $1,622.8 million and $1,346.2 million as of June 30, 2026 and 2025, respectively, and fiduciary receivables of $4,086.8
million and $3,128.7 million as of June 30, 2026 and 2025, respectively. While we may earn interest income on fiduciary
cash held in cash and investments, the fiduciary cash may not be used for general corporate purposes. Of the $140.1 million
of Cash and cash equivalents on the Consolidated Balance Sheet as of June 30, 2026, $74.3 million was held in fiduciary
accounts representing collected revenue and was available to be transferred to operating accounts and used for general
corporate purposes.
50
Credit Facilities
We expect to have sufficient financial resources to meet our business requirements for the next 12 months. Although cash
from operations is expected to be sufficient to service our activities, including servicing our debt and contractual
obligations, and financing capital expenditures, we have the ability to borrow under our Revolving Credit Facility to
accommodate any timing differences in cash flows. Additionally, under current market conditions, we believe that we
could access capital markets to obtain debt financing for longer-term funding, if needed.
On February 3, 2022, the LLC issued $400.0 million of 8-year Senior Secured Notes. The notes have a 4.375% interest rate
and will mature on February 1, 2030.
On January 19, 2024, we entered into the Fifth Amendment to the Credit Agreement, which reduced the applicable interest
rate of the Term Loan from Adjusted Term SOFR + 3.00% to Adjusted Term SOFR + 2.75% and no longer contains a
credit spread adjustment. All other material provisions remain unchanged.
On July 30, 2024, the Company entered into the Sixth Amendment to the Credit Agreement, which provided for an
increase in borrowing capacity under the Revolving Credit Facility from $600.0 million to $1,400.0 million. The
amendment also extended the maturity date of the Revolving Credit Facility to July 30, 2029, and reduced the applicable
interest rate from Adjusted Term SOFR plus a margin of 2.50% to 3.00% to Adjusted Term SOFR plus a margin of 2.00%
to 2.50%, based on the first lien net leverage ratio defined in the Credit Agreement.
On September 13, 2024, the Company entered into the Seventh Amendment to the Credit Agreement, which refinanced the
existing Term Loan in the aggregate principal amount of $1,588.1 million outstanding as of June 30, 2024, and increased
the size of the Term Loan by $111.9 million to $1,700.0 million as of September 30, 2024. In addition to increasing the
size of the Term Loan, the Seventh Amendment reduced the applicable interest rate of the Term Loan from Adjusted Term
SOFR plus a margin of 2.75% to Adjusted Term SOFR plus a margin of 2.25% and lowered the 75 basis point floor on
Adjusted Term SOFR to a 0 basis point floor. In August 2025, Moody’s Ratings upgraded the Company’s credit rating
from B1 to Ba3. As a result, the applicable interest rate on the Company’s Term Loan decreased from Adjusted Term
SOFR + 2.25% to Adjusted Term SOFR + 2.00%.
On September 19, 2024, the LLC issued $600.0 million of 8-year Senior Secured Notes. On December 9, 2024, the LLC
issued an additional $600.0 million of its 2032 Senior Secured Notes as “additional notes” under a supplement to the
indenture dated as of September 2024. All of the 2032 Senior Secured Notes carry a 5.875% interest rate and will mature
on August 1, 2032.
As of June 30, 2026, the interest rate on the Term Loan was 2.00% plus Adjusted Term SOFR.
As of June 30, 2026, the Company was in compliance with all of the covenants under the Credit Agreement and there were
no events of default for the six months ended June 30, 2026.
Tax Receivable Agreement
The Company is party to a TRA with current and certain former LLC Unitholders. The TRA provides for the payment by
the Company, to current and certain former LLC Unitholders, of 85% of the net cash savings, if any, in U.S. federal, state,
and local income taxes that the Company realizes (or is deemed to realize in certain circumstances) as a result of (i) certain
increases in the tax basis of the assets of the LLC resulting from purchases or exchanges of LLC Common Units
(“Exchange Tax Attributes”), (ii) certain tax attributes of the LLC that existed prior to the IPO (“Pre-IPO M&A Tax
Attributes”), (iii) certain favorable “remedial” partnership tax allocations to which the Company becomes entitled to (if
any), and (iv) certain other tax benefits related to the Company entering into the TRA, including tax benefits attributable to
payments that the Company makes under the TRA (“TRA Payment Tax Attributes”). The Company recognizes a liability
on the Consolidated Balance Sheets based on the undiscounted estimated future payments under the TRA.
Due to the uncertainty of various factors, we cannot precisely quantify the likely tax benefits we will realize as a result of
the LLC Common Unit exchanges and the resulting amounts we are likely to pay out to current and certain former LLC
Unitholders pursuant to the TRA; however, we estimate that such tax benefits and the related TRA payments may be
substantial. As set forth in the table below, and assuming no changes in the relevant tax law and that we earn sufficient
taxable income to realize all cash tax savings that are subject to the TRA, we expect future payments under the TRA as a
result of transactions as of June 30, 2026, will be $463.7 million in aggregate. Future payments in respect to subsequent
exchanges would be in addition to these amounts and are expected to be substantial. The foregoing amounts are merely
estimates and the actual payments could differ materially. In the highly unlikely event of an early termination of the TRA
(e.g., a default by the Company or a Change of Control) the Company is required to pay to each holder of the TRA an early
termination payment equal to the discounted present value of all unpaid TRA payments. The Company has not made, and
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is not likely to make, an election for an early termination. We expect to fund future TRA payments with tax distributions
from the LLC that come from cash on hand and cash generated from operations.
Total expected estimated tax savings from each of the tax attributes associated with the TRA as of June 30, 2026, were
$545.5 million consisting of (i) Exchange Tax Attributes of $323.3 million, (ii) Pre-IPO M&A Tax Attributes of $91.4
million, and (iii) TRA Payment Tax Attributes of $130.8 million. The Company will retain the benefit of 15% of these cash
savings.
Comparison of Cash Flows for the Six Months Ended June 30, 2026 and 2025
Cash and cash equivalents decreased $32.5 million from $172.6 million at June 30, 2025, to $140.1 million at June 30,
2026. A summary of the Company’s cash flows provided by and used for continuing operations from operating, investing,
and financing activities is as follows:
Cash Flows From Operating Activities
Cash flows provided by operating activities during the six months ended June 30, 2026, were $125.6 million, a decrease of
$85.1 million compared to the six months ended June 30, 2025. The primary drivers behind the decrease in cash flows
provided by operating activities were an increase in Commissions and fees receivable - net of $112.1 million, a decrease in
Deferred income tax expense from common control reorganizations of $48.0 million related to the Velocity acquisition in
the first quarter of 2025, and a decrease of $9.4 million in Accrued interest liability. These decreases in operating cash
flows were offset by an increase in Other current and non-current assets and liabilities of $47.1 million, an increase of
$28.7 million in Net income, and an increase of $12.0 million in Impairment of internally-developed software.
Cash Flows From Investing Activities
Cash flows used for investing activities during the six months ended June 30, 2026, were $32.0 million, a decrease of
$587.0 million compared to the $619.0 million of cash flows used for investing activities during the six months ended
June 30, 2025. The main driver of the cash flows used for investing activities during the six months ended June 30, 2026,
was $30.4 million of Capital expenditures, compared to $565.1 million for Business combinations - net of cash acquired
and cash held in a fiduciary capacity, $36.5 million of Capital expenditures, and $16.6 million for the Equity method
investment in VSIC for the six months ended June 30, 2025.
Cash Flows From Financing Activities
Cash flows provided by financing activities during the six months ended June 30, 2026, were $90.3 million, a decrease of
$144.1 million compared to cash flows provided by financing activities of $234.4 million during the six months ended
June 30, 2025. The main driver of cash flows provided by financing activities during the six months ended June 30, 2026,
were Borrowings on Revolving Credit Facility (net of repayments) of $284.7 million and a Net change in fiduciary
liabilities of $200.6 million. These increases in cash provided by financing activities were offset by Repurchases of Class A
common stock of $300.2 million, Class A common stock dividends and Dividend Equivalents paid of $33.7 million,
Payment of contingent consideration of $22.0 million, Tax distributions to non-controlling LLC Unitholders of $18.0
million, Distributions and Declared Distributions paid to non-controlling LLC Unitholders of $16.2 million, and $8.5
million of Repayment of term debt. The main drivers of cash flows provided by financing activities during the six months
ended June 30, 2025, were Borrowings on Revolving Credit Facility (net of repayments) of $187.7 million and a Net
change in fiduciary liabilities of $166.3 million offset by Tax distributions to non-controlling LLC Unitholders of $34.8
million, Class A common stock dividends and Dividend Equivalents paid of $30.5 million, Payment of contingent
consideration of $29.3 million, Distributions and Declared Distributions paid to non-controlling LLC Unitholders of $13.6
million, Repayment of term debt of $8.5 million, and Debt issuance costs paid of $2.9 million.
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Contractual Obligations and Commitments
Our principal commitments consist of contractual obligations in connection with investing and operating activities. These
obligations are described within “Note 7, Debt” in the notes to our unaudited consolidated financial statements, where we
provide further description on provisions that create, increase, or accelerate obligations, or other pertinent data to the extent
necessary for an understanding of the timing and amount of the specified contractual obligations.
The Company recognized a liability for employee deferrals, inclusive of changes in the value of deferred amounts held, of
$8.7 million and $59.3 million in Current accrued compensation and Non-current accrued compensation, respectively, on
the Consolidated Balance Sheets as of June 30, 2026, and $5.8 million and $44.2 million in Current accrued compensation
and Non-current accrued compensation, respectively, on the Consolidated Balance Sheets as of June 30, 2025. The timing
of when employees elect to make withdrawals from the deferred compensation plan is uncertain. However, employees are
not allowed to make a withdrawal for three years from the deferral date and must withdraw all deferred compensation
balances within ten years of the deferral date.
Within Current accrued compensation and Non-current accrued compensation we have various long-term incentive
compensation agreements accrued for. These agreements are typically associated with an acquisition. Below we have
outlined the liabilities accrued as of June 30, 2026, the projected future expense, and the projected timing of future cash
outflows associated with these arrangements.
Projected Future Cash Outflows | ||
(in thousands) | ||
2026 | $10,256 | |
2027 | 6,708 | |
2028 | 26,080 | |
2029 | 10,708 | |
Thereafter | $8,123 | |
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Within “Note 3, Mergers and Acquisitions” in the notes to our unaudited consolidated financial statements we discuss
various contingent consideration arrangements and their impact. Below we have outlined the liabilities accrued as of
June 30, 2026, the projected future expense, and the projected timing of future cash outflows associated with these
contingent consideration agreements.
Projected Future Cash Outflows | ||
(in thousands) | ||
2026 | $43,819 | |
2027 | 106,531 | |
2028 | 6,126 | |
2029 | 2,987 | |
Thereafter | $331 | |
Critical Accounting Policies and Estimates
The methods, assumptions, and estimates that we use in applying the accounting policies may require us to apply
judgments regarding matters that are inherently uncertain. We consider an accounting policy to be a critical estimate if (i)
the Company must make assumptions that were uncertain when the judgment was made and (ii) changes in the estimate
assumptions, or selection of a different estimate methodology, could have a significant impact on our financial position and
the results that we will report in the consolidated financial statements. While we believe that the estimates, assumptions,
and judgments are reasonable, they are based on information available when the estimate was made. The accounting
policies that we believe reflect our more significant estimates, judgments, and assumptions that are most critical to
understanding and evaluating our reported financial results are: revenue recognition, business combinations, goodwill and
intangibles, income taxes, and tax receivable agreement liabilities.
Our critical accounting policies are described under the heading “Management’s Discussion and Analysis of Financial
Condition and Results of Operations—Critical Accounting Policies” in the Annual Report on Form 10-K for the year
ended December 31, 2025, filed with the SEC on February 13, 2026. Additionally, the changes, if any, to our critical
accounting policies and estimates disclosed in the Annual Report on Form 10-K for the year ended December 31, 2025, are
included in “Note 1, Basis of Presentation,” to our unaudited consolidated financial statements.
Recent Accounting Pronouncements
For a description of recently adopted accounting pronouncements and recently issued accounting standards not yet adopted,
if any, see “Note 1, Basis of Presentation” in the notes to our unaudited consolidated financial statements.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
We are exposed to various market risks in our day-to-day operations. Market risk is the potential loss arising from adverse
changes in market rates and prices, such as interest and foreign currency exchange rates.
Foreign Currency Risk
For the six months ended June 30, 2026, approximately 7% of revenues were generated from activities in the United
Kingdom, Europe, Canada, and Singapore. We are exposed to currency risk from the potential changes between the
exchange rates of the US Dollar, British Pound, Euro, Swedish Krona, Canadian Dollar, Indian Rupee, Singapore Dollar,
and other currencies. The exposure to foreign currency risk from the potential changes between the exchange of USD and
other currencies is immaterial.
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Interest Rate Risk and Credit Risk
Certain of the Company’s revenues, expenses, assets, and liabilities are exposed to the impact of interest rate changes.
Interest rate risk and credit risk to counterparties generated from the Company’s Cash and cash equivalents, and Cash and
cash equivalents held in a fiduciary capacity, will fluctuate with the general level of interest rates.
As of June 30, 2026, we had $1,674.5 million of outstanding principal on our Term Loan borrowings, which bears interest
on a floating rate, subject to a 0.0% floor. We are subject to Adjusted Term SOFR interest rate changes and exposure in
excess of the floor. The fair value of the Term Loan approximates the carrying amount as of June 30, 2026 and
December 31, 2025, as determined based upon information available.
Based on the below balances as of June 30, 2026, the impact of a hypothetical 100 basis point (BPS) increase or decrease
in quarter-end prevailing short-term interest rates for one year would be:
(in thousands) | Balance at June 30, 2026 | 100 BPS Increase | 100 BPS Decrease | |||
Cash and cash equivalents | $140,119 | $(1,401) | $1,401 | |||
Term Loan principal outstanding (1) | 1,674,500 | 16,745 | (16,745) | |||
Net exposure to Interest expense, net | $15,344 | $(15,344) | ||||
Cash and cash equivalents held in a fiduciary capacity | $1,622,766 | $16,228 | $(16,228) | |||
Net exposure to Fiduciary investment income | $16,228 | $(16,228) | ||||
Impact to Net income | $884 | $(884) |
(1)To the extent SOFR falls below 0.0%, the impact of the change in interest rates is zero.
In addition to interest rate risk, our cash investments and fiduciary cash holdings are subject to potential loss of value due
to counterparty credit risk. To minimize this risk, the Company and its subsidiaries hold funds pursuant to an investment
policy approved by our Board. The policy mandates the preservation of principal and liquidity and requires broad
diversification with counter-party limits assigned based primarily on credit rating and type of investment. The Company
carefully monitors its cash, cash equivalents, and cash and cash equivalents held in a fiduciary capacity, and plans to
further restrict the portfolio as appropriate with respect to market conditions. The majority of Cash and cash equivalents
and Cash and cash equivalents held in a fiduciary capacity are held in demand deposit accounts and short-term investments,
consisting principally of AAA-rated money market funds and treasury bills, having original maturities of 90 days or less.
Other financial instruments consist of Cash and cash equivalents, Commissions and fees receivable – net, Other current
assets, and Accounts payable and accrued liabilities. The carrying amounts of Cash and cash equivalents, Commissions and
fees receivable – net, and Accounts payable and accrued liabilities approximate fair value because of the short-term nature
of the instruments.
ITEM 4. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
We maintain “disclosure controls and procedures,” as defined in Rule 13a–15(e) and Rule 15d–15(e) under the Securities
Exchange Act of 1934, as amended (the “Exchange Act”), that are designed to provide reasonable assurance that
information required to be disclosed by the Company in the reports that we file or submit under the Exchange Act is
recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms. Disclosure
controls and procedures include, without limitation, controls and procedures designed to provide reasonable assurance that
information required to be disclosed by the Company in the reports that we file or submit under the Exchange Act is
accumulated and communicated to our management, including our principal executive and principal financial officers, as
appropriate, to allow timely decisions regarding required disclosure. Based on such evaluation, our principal executive
officer and principal financial officer have concluded that as of June 30, 2026, our disclosure controls and procedures were
effective at the reasonable assurance level.
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Changes in Internal Control
There have been no changes in internal control over financial reporting during the quarter ended June 30, 2026, that have
materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Inherent Limitations of Internal Control Over Financial Reporting
Our disclosure controls and procedures are designed to provide reasonable assurance of achieving their objectives as
specified above. Management does not expect, however, that our disclosure controls and procedures will prevent or detect
all errors and fraud. Any control system, no matter how well designed and operated, is based upon certain assumptions and
can provide only reasonable, not absolute, assurance that its objectives will be met. Further, no evaluation of controls can
provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of
fraud, if any, within the Company have been detected.
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PART II — OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
From time to time, we may be involved in various legal proceedings and subject to claims that arise in the ordinary course
of business. Although the results of litigation and claims are inherently unpredictable and uncertain, we are not presently a
party to any litigation the outcome of which, we believe, if determined adversely to us, would individually or taken
together have a material adverse effect on our business, operating results, cash flows or financial condition.
ITEM 1A. RISK FACTORS
There have been no material changes to the risk factors disclosed under the heading “Risk Factors” in our annual report on
Form 10-K for the year ended December 31, 2025, which was filed with the SEC on February 13, 2026.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
Unregistered Sales of Equity Securities.
On April 28, 2026, Ryan Specialty Holdings, Inc., issued 172 shares of Class A Common Stock in a private placement
transaction to the Estate of D. Cameron Findlay, a former director of the Company who passed away on July 11, 2025. The
issuance represents the pro rata equity compensation that Mr. Findlay earned for his service on the Board from the 2025
Annual Meeting of Stockholders through the date of his passing and was undertaken in reliance on the exemption from
registration set forth in section 4(a)(2) of the Securities Act of 1933.
Purchases of Equity Securities by the Issuer.
The following table summarizes purchases of shares of our Class A Common Stock during the three months ended June 30,
2026, by the Company and any “affiliated purchasers” within the meaning of Rule 10b-18(a)(3) under the Exchange Act.
Period | Total Number of Shares Purchased | Average Price Paid per Share 1 | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs 2 | ||||
4/1/26 - 4/30/26 | — | $— | — | $260,000,036 | ||||
5/1/26 - 5/31/26 | 8,129,462 | 31.98 | 8,129,462 | 300,000,017 | ||||
6/1/26 - 6/30/26 3 | 120,000 | 32.50 | — | 300,000,017 | ||||
TOTAL | 8,249,462 | $31.99 | 8,129,462 |
1 Does not include commissions paid to purchase shares.
2 On February 10, 2026, the Board of Directors approved an open-ended $300 million share repurchase program, which
was publicly announced on February 12, 2026. On May 21, 2026, the Company’s Board of Directors authorized a $300.0
million increase to the Company’s share repurchase program, which was publicly announced on May 26, 2026.
3 All shares purchased in June were purchased in open-market transactions by Mr. Ryan who may be deemed to be an
“affiliated purchaser” within the meaning of Rule 10b-18(a)(3) under the Exchange Act.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
ITEM 5. OTHER INFORMATION
During the quarter ended June 30, 2026, Mark S. Katz, Executive Vice President, General Counsel and Corporate
Secretary, terminated, on June 3, 2026, a “Rule 10b5-1 trading arrangement” (as such term is defined in Item 408(a) of
Regulation S-K) intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act (a
“10b5-1 Plan”). No sales of the Company’s Class A common stock occurred under the plan prior to its termination. Prior to
its termination, the plan had provided for the sale of (i) up to 5,500 shares of the Company’s Class A common stock
57
issuable upon conversion of LLC Common Units and (ii) a number of shares of Class A common stock issuable upon
conversion of up to 70,000 Class C Incentive Units of New LLC (the “Class C Units”), between the first potential sale date
of June 4, 2026, and the expiration of the 10b5-1 Plan on June 1, 2027. The Class C Units are profits interests with a
participation threshold, as of March 31, 2026, of $23.08. Pursuant to the terms of the award agreement for the Class C
Units, the participation threshold is adjusted downward for distributions that the LLC makes to the Company. When the
value of the Class A common stock exceeds the participation threshold of the Class C Units, the vested profits interests
may be exchanged for LLC Common Units of equal value where the value of each Class C Unit is equal to the difference
between the 20-day volume weighted average price of the Class A common stock immediately preceding the date of
exchange and the participation threshold. On exchange, the LLC Common Units are immediately redeemed on a one-for-
one basis for Class A common stock of the Company. For more information regarding Class C Incentive Units of New
LLC and applicable participation threshold information, see “Note 9, Equity-Based Compensation” of the unaudited
quarterly consolidated financial statements included herein.
Other than as disclosed above, during the quarter ended June 30, 2026, none of our directors or officers (as defined in
Section 16 of the Securities Exchange Act of 1934, as amended) adopted or terminated a “Rule 10b5-1 trading
arrangement” or a “non-Rule 10b5-1 trading arrangement” (each as defined in Item 408 of Regulation S-K).
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10.10 | ||
10.11 | ||
10.12 | ||
10.13 | ||
10.14 | ||
10.15 | ||
10.16 | ||
10.17 | ||
10.18 | ||
10.19 | ||
10.20 | ||
10.21 | ||
19.1 | ||
31.1 | ||
31.2 | ||
32.1* | ||
32.2* | ||
97.1 | ||
101.INS | Inline XBRL (Extensible Business Reporting Language) 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 With Embedded Linkbase Documents | |
104 | Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101) |
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*The certifications furnished in Exhibit 32.1 and Exhibit 32.2 hereto are deemed to accompany this Quarterly Report on
Form 10-Q and will not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as
amended, except to the extent that the registrant specifically incorporates it by reference.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this
report to be signed on its behalf by the undersigned thereunto duly authorized.
RYAN SPECIALTY HOLDINGS, INC. (Registrant) | ||
Date: July 31, 2026 | By: | /s/ Janice M. Hamilton |
Janice M. Hamilton | ||
Executive Vice President and Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer) | ||
