Trupanion Inc (TRUP) 2024 Q2 法說會逐字稿

Good day, and welcome to the Trupanion second-quarter 2024 earnings conference call. (Operator Instructions)

美好的一天，歡迎參加 Trupanion 2024 年第二季財報電話會議。（操作員說明）

Please note this event is being recorded. I would now like to turn the call over to Gil Melchior, Director of Investor Relations. Please go ahead.

請注意此事件正在被記錄。我現在想將電話轉給投資者關係總監 Gil Melchior。請繼續。

Good afternoon, and welcome to Trupanion's second-quarter 2024 financial results conference call. Participating on today's call are Margi Tooth, President and Chief Executive Officer; and Fawwad Qureshi, Chief Financial Officer.

下午好，歡迎參加 Trupanion 2024 年第二季財務業績電話會議。出席今天電話會議的有總裁兼執行長 Margi Tooth；和財務長 Fawwad Qureshi。

For ease of reference, we've included a slide presentation to accompany today's discussion, which will be made available on our Investor Relations website under our quarterly earnings tab.

為了方便參考，我們在今天的討論中附上了幻燈片演示文稿，該演示文稿將在我們的投資者關係網站上的季度收益選項卡下提供。

Before we begin, please be advised that remarks today will contain forward-looking statements. All statements other than statements of historical facts are forward-looking statements. These include, but are not limited to, statements regarding our future operations, opportunities and financial performance, pricing and veterinary industry inflation and our ability to remediate our material weaknesses.

在我們開始之前，請注意，今天的言論將包含前瞻性陳述。除歷史事實陳述外的所有陳述均為前瞻性陳述。這些包括但不限於有關我們未來營運、機會和財務表現、定價和獸醫行業通膨以及我們糾正重大弱點的能力的聲明。

These statements involve a high degree of known and unknown risks and uncertainties that could cause actual results to differ materially from those discussed. A detailed discussion of these and other risks and uncertainties are included in today's earnings release as well as the company's most recent reports on Forms 10-K and 8-K filed with the Securities and Exchange Commission.

這些陳述涉及高度已知和未知的風險和不確定性，可能導致實際結果與討論的結果有重大差異。對這些以及其他風險和不確定性的詳細討論包含在今天的收益報告以及公司向美國證券交易委員會提交的 10-K 和 8-K 表格的最新報告中。

Today's presentation contains references to non-GAAP financial measures that management uses to evaluate the company's performance, including, without limitation, cost of paying veterinary invoices, variable expenses, fixed expenses, adjusted operating income, acquisition costs, internal rate of return, adjusted EBITDA and free cash flow. When we use the term adjusted operating income or margin, is intended to refer to our non-GAAP operating income or margin before new pet acquisition and development expenses.

今天的簡報引用了管理層用來評估公司業績的非公認會計原則財務指標，包括但不限於支付獸醫發票的成本、可變費用、固定費用、調整後的營業收入、收購成本、內部收益率、調整後的EBITDA和自由現金流。當我們使用調整後營業收入或利潤率一詞時，是指我們在新寵物收購和開發費用之前的非公認會計準則營業收入或利潤率。

Unless otherwise noted, margins and expenses will be presented on a non-GAAP basis, which excludes stock-based compensation expense and depreciation expense. These non-GAAP measures are in addition to another substitute for measures of financial performance prepared in accordance with the U.S. GAAP. Investors are encouraged to review the reconciliations of these non-GAAP financial measures to the most directly comparable GAAP results, which can be found in today's press release or on Trupanion's Investor Relations website under the quarterly earnings tab.

除非另有說明，利潤和費用將以非公認會計原則列報，其中不包括基於股票的補償費用和折舊費用。這些非公認會計原則衡量標準是根據美國制定的財務績效衡量標準的另一種替代標準。公認會計準則。我們鼓勵投資者審查這些非 GAAP 財務指標與最直接可比較的 GAAP 結果的對帳情況，這些結果可以在今天的新聞稿或 Trupanion 投資者關係網站的季度收益標籤下找到。

Lastly, I would like to remind everyone that today's conference call is also available via webcast on Trupanion's Investor Relations website. A replay will also be available on the site. With that, I'll hand it over to Margi.

最後，我想提醒大家，今天的電話會議也可以透過 Trupanion 投資人關係網站上的網路直播觀看。網站上也將提供重播。這樣，我就把它交給瑪姬了。

Thank you, Gil. Good afternoon, everyone. After over a decade with the company, I am honored to join you all today for my first call as the CEO of Trupanion. I look forward to spending time with many of you at our upcoming Investor Day in September, where I'll be joined by leaders from across the business for an extensive Q&A session.

謝謝你，吉爾。大家下午好。在公司工作了十多年後，今天我很榮幸能與大家一起參加我作為 Trupanion 執行長的第一次電話會議。我期待在即將到來的九月投資者日與你們中的許多人共度時光，屆時我將與來自整個企業的領導者一起參加廣泛的問答環節。

Now moving on to our results. Quarter two was a strong quarter for the company, as shown in our key financial markets. Our subscription business remains the financial engine behind our business. And in the quarter, revenue from this segment increased by 20%.

現在繼續我們的結果。正如我們的主要金融市場所示，第二季對公司來說是一個強勁的季度。我們的訂閱業務仍然是我們業務背後的財務引擎。本季度，該部門的收入成長了 20%。

Breaking down the components of this growth, ARPU increased by 11% year over year, a record pace since we became publicly traded 10 years ago and pet count increased by 8%. Within our core Trupanion brand, ARPU expanded even faster at 13% year over year.

細分成長的組成部分，ARPU 年增 11%，這是我們 10 年前上市以來的創紀錄速度，寵物數量增加了 8%。在我們的核心 Trupanion 品牌中，ARPU 成長速度更快，年增 13%。

Modulating between growth and pricing is a focus of the team as we continue to work to achieve our target value proposition of 71% in our subscription business. In our large and underpenetrated market, adding and helping more pets remains a guiding mandate. However, we will only do so when we're confident that we can deliver on the member experience for which Trupanion is known.

隨著我們繼續努力實現訂閱業務 71% 的目標價值主張，在成長和定價之間進行調節是團隊的重點。在我們龐大且滲透率較低的市場中，增加和幫助更多寵物仍然是一項指導性任務。然而，只有當我們有信心能夠提供 Trupanion 聞名的會員體驗時，我們才會這樣做。

In the quarter, we had approximately 24% pricing rolling through our book and veterinary inflation remained consistent with our expectations at 15%. Against this backdrop, retention in the quarter was strong with the average pet staying with us for over 60 months. This also includes our lower coverage and thus lower retention products. We're pleased with these results, a reflection of our efforts to communicate our value proposition and improve upon our member experience.

本季度，我們的帳面定價約為 24%，獸醫通膨率仍與我們 15% 的預期一致。在此背景下，本季的留存率很高，寵物在我們家的平均停留時間超過 60 個月。這也包括我們較低的覆蓋率和較低的保留率產品。我們對這些結果感到滿意，這反映了我們為傳達價值主張和改善會員體驗所做的努力。

Within our core Trupanion product, approximately half of our Trupanion members have received a pricing increase of 20% or more over the last 12 months. Retention of this cohort continued to perform well in the quarter and was up both sequentially and year over year. These results demonstrate our focus on the member experience and early benefits from the migration to our new technology and automation platforms.

在我們的核心 Trupanion 產品中，大約一半的 Trupanion 會員在過去 12 個月內價格上漲了 20% 或更多。該群體的保留率在本季度繼續表現良好，並且環比和同比均有所上升。這些結果顯示我們注重會員體驗以及遷移到新技術和自動化平台後的早期收益。

This new claims administration system has been in development for some time, and we're pleased to see some initial benefits leading to a higher proportion of our claims being paid directly to the veterinarian and with record reimbursement time lines for those being paid in a more traditional way. We expect to provide you with more details on these investments, the early performance metrics and our ongoing member experience road map at our upcoming Investor Day in September.

這個新的索賠管理系統已經開發了一段時間，我們很高興看到一些初步的好處，導致我們有更高比例的索賠直接支付給獸醫，並且對於那些以更多方式支付的索賠，創紀錄的報銷時間軸。我們希望在即將到來的 9 月投資者日向您提供有關這些投資、早期績效指標以及我們持續的會員體驗路線圖的更多詳細資訊。

We recently received meaningful rate approvals in two of our largest states that are beginning to take effect. While these new rates will take time to run through our book, they should enable us to increase acquisition spending and pet growth in these regions now that we've reestablished pricing that allows for estimated returns between 30% to 40% on new pet acquisition.

最近，我們在兩個最大的州獲得了有意義的利率批准，並開始生效。雖然這些新費率需要時間來貫穿我們的書，但它們應該使我們能夠增加這些地區的收購支出和寵物成長，因為我們已經重新制定了定價，允許新寵物收購的預期回報率在30% 到40 % 之間。

Adjusted operating income represents the funds we have to invest in growth. And in the quarter, these funds grew 48% year over year. Adjusted operating income for our subscription segment grew even faster at 63% and represents an acceleration from the 55% growth we reported in the first quarter. As a percent of revenue, subscription adjusted operating margin expanded 280 basis points to 11% in the quarter, marked progress towards our goal of 15% adjusted operating margin.

調整後的營業收入代表我們必須投資於成長的資金。本季度，這些基金年增 48%。我們訂閱業務的調整後營業收入成長更快，達到 63%，比我們第一季報告的 55% 的成長加快。本季度訂閱調整後營業利潤率佔收入的百分比增長了 280 個基點，達到 11%，這標誌著我們在實現 15% 調整後營業利潤率的目標方面取得了進展。

As for what we'll communicate, we remain on track to hit this target in the fourth quarter. Operating our business within our target margin profile and IRR guardrails ensures the sustainability of our business, positioning us to help pets, pet parents and veterinarians for the decades to come.

至於我們將傳達的內容，我們仍然預計在第四季度實現這一目標。在目標利潤率和 IRR 護欄內經營我們的業務可確保我們業務的可持續性，使我們能夠在未來幾十年為寵物、寵物父母和獸醫提供幫助。

The health of the veterinary profession remains critical to our success. Two years ago, we highlighted the growing burnout of veterinarians and their teams due to the rising cost of care, staff shortages and over work. At the time, we noted the need for 30% to 50% pricing increases, an estimate that has since been validated by veterinary industry inflation.

獸醫行業的健康對我們的成功仍然至關重要。兩年前，我們強調由於護理成本上升、人員短缺和過度工作，獸醫及其團隊的倦怠日益嚴重。當時，我們注意到需要將價格上漲 30% 至 50%，這一估計後來已被獸醫行業通膨所證實。

Our members put their trust in Trupanion, 24/7, and the value proposition of our core product is designed with a unique aged enrollment pricing approach. This removes the need for guaranteed annual rate increases simply because a pet has had a birthday. We've created a solution that's designed to last, that can be relied on with the same dependability as our pets provide to us.

我們的會員信任 Trupanion，24/7，我們核心產品的價值主張是採用獨特的老年註冊定價方法設計的。這就消除了僅僅因為寵物過生日就保證年費上漲的需要。我們創建了一個持久耐用的解決方案，可以像我們的寵物為我們提供的一樣可靠。

Yet this past quarter, recent reports from across the pet insurance landscape demonstrate that not every insurer can or will be there in the same way. The rate of veterinary inflation has tested the most established of players and now over 100,000 pets are without coverage due to mispricing. This outcome is very unfortunate, both for the pets without coverage and the industry overall. It underscores the importance of Trupanion's approach to lifetime coverage and our simple, sustainable cost plus model.

然而，上個季度，寵物保險領域的最新報告表明，並非所有保險公司都能或將以同樣的方式參與其中。獸醫通貨膨脹率已經考驗了最成熟的參與者，現在超過 100,000 隻寵物由於定價錯誤而沒有保險。對於沒有保險的寵物和整個產業來說，這個結果是非常不幸的。它強調了 Trupanion 終身保險方法和我們簡單、可持續的成本加成模型的重要性。

Unlike competitors who attract customers with low prices or limited coverage, we prioritize delivering the best value by offering comprehensive coverage and higher claims payout. This approach ensures pets receive the care they need, resulting in higher customer satisfaction and exceptional lifetime value. By adding a fixed margin to our comprehensive plans, we maintain a sustainable business model with long-term benefits for our members, their pets and the veterinary community.

與以低價或有限承保範圍吸引客戶的競爭對手不同，我們優先透過提供全面的承保範圍和更高的索賠賠償來提供最佳價值。這種方法可確保寵物得到所需的護理，從而提高客戶滿意度和卓越的終身價值。透過在我們的綜合計劃中增加固定利潤，我們維持了可持續的商業模式，為我們的會員、他們的寵物和獸醫界帶來長期利益。

With low single-digit penetration across our addressable markets, we have a long way to go to make the difference we aspire to. As margins move sequentially closer to our goal of 15%, we're pleased to be turning our attention back to growth.

由於我們的目標市場滲透率較低，我們還有很長的路要走，才能實現我們所渴望的改變。隨著利潤率逐步接近我們 15% 的目標，我們很高興將注意力重新轉向成長。

With that in mind, moving back to the second quarter, we acquired 64,300 pets at an estimated internal rate of return of 37%. This represents a 15% decrease in new pets year over year on a reduction in pet acquisition spend of 17%. While we're not yet maximizing our use of adjusted operating income for growth, our margin expansion afforded us the opportunity to deploy approximately 6% more impact versus Q1.

考慮到這一點，回到第二季度，我們購買了 64,300 隻寵物，估計內部回報率為 37%。這意味著新寵物數量比去年同期減少了 15%，而寵物購買支出則減少了 17%。雖然我們尚未最大限度地利用調整後的營業收入來實現成長，但我們的利潤率擴張使我們有機會比第一季增加約 6% 的影響力。

Our newer initiatives, including our powered by suite of products with Chewy and Aflac, our medium and low ARPU products, Furkin and PHI Direct, and our products in Continental Europe comprised approximately 17% of our gross new pet adds in the quarter. We deployed $1.8 million against these opportunities, just 11% of our pet acquisition spend, a conservative amount of capital given these products are early in the life cycle and subscale.

我們的新舉措，包括 Chewy 和 Aflac 的產品套件、中低 ARPU 產品、Furkin 和 PHI Direct，以及我們在歐洲大陸的產品，約佔本季新增寵物總量的 17%。我們針對這些機會部署了 180 萬美元，僅占我們寵物採購支出的 11%，考慮到這些產品仍處於生命週期的早期和規模較小，這是一個保守的資本數額。

Our continued discipline on acquisition spending, coupled with our increase in margin led to $4 million of free cash flow in the quarter. In summary, we're pleased with the quarter. The team's hard work and solid execution is showing good results, which bodes well for our margin and free cash flow goals.

我們對收購支出的持續嚴格控制，加上利潤率的增加，導致本季自由現金流達到 400 萬美元。總之，我們對本季感到滿意。團隊的辛勤工作和紮實的執行力顯示出良好的成果，這對我們的利潤率和自由現金流目標來說是個好兆頭。

With less than 4% of pets insured in the US, Puerto Rico, and Canada, and an equally low number across most of Europe, our mandate remains to enroll more pets. We will continue to do so prudently, gradually scale up our acquisition spend and prioritizing accordingly across cohorts as margins expand.

在美國、波多黎各和加拿大，只有不到 4% 的寵物投保，歐洲大部分地區的投保人數也同樣低，因此我們的任務仍然是為更多的寵物投保。我們將繼續謹慎行事，逐步擴大我們的收購支出，並隨著利潤率的擴大而在各個群體中進行相應的優先排序。

Now before I hand over to Fawwad, I'd like to briefly touch on an important update to underwriting factors in the property and casualty risk-based capital calculation that were recently approved by the National Association of Insurance Commissioners, the NAIC.

現在，在向 Fawwad 發言之前，我想簡要介紹美國保險專員協會 (NAIC) 最近批准的基於財產和傷亡風險的資本計算中承保因素的重要更新。

These updates significantly decreased the capital intensity of our balance sheet. Although pet insurance continues to be subject to the same risk-based capital requirement factors as special property, within this update, pet insurance was designated as its own line of business. After more than two decades of discussions to recognize pet insurance in its own right, this is a big step forward for Trupanion and the category at large.

這些更新顯著降低了我們資產負債表的資本密集度。儘管寵物保險仍然受到與特殊財產相同的基於風險的資本要求因素的影響，但在本次更新中，寵物保險被指定為自己的業務範圍。經過二十多年的討論，承認寵物保險本身的權利，這對 Trupanion 和整個類別來說是向前邁出的一大步。

With that, I'll hand over to Fawwad to provide a detailed overview of our Q2 results.

接下來，我將由 Fawwad 詳細概述我們第二季的業績。

Thanks, Margi, and good afternoon, everyone. Let me begin by congratulating Margi on assuming the role of CEO of Trupanion. I'm thrilled to be working with Margi to lead the company into our next phase of growth. Our mission to help pet parents and the opportunity to work with Margi are the reasons I joined the company.

謝謝瑪吉，大家下午好。首先我要祝賀 Margi 就任 Trupanion 執行長。我很高興能與瑪吉合作，帶領公司進入下一階段的成長。我們幫助寵物父母的使命以及與 Margi 合作的機會是我加入公司的原因。

With that, I'll turn to our Q2 results as well as provide our outlook for the third quarter and full year 2024. It was another strong quarter with revenue and adjusted operating income coming in ahead of expectations. Total revenue for the quarter was $314.8 million, up 16% year over year. Within our subscription business, revenue was $208.6 million, up 20% year over year.

接下來，我將談談我們第二季的業績，並提供我們對第三季和 2024 年全年的展望。這是又一個強勁的季度，收入和調整後的營業收入都超出了預期。該季度總營收為 3.148 億美元，年增 16%。我們的訂閱業務收入為 2.086 億美元，年增 20%。

Total subscription pets increased 8% year over year to [1.02 million] pets as of June 30. This includes approximately 46,000 pets in Europe, which are currently underwritten by third parties. Average monthly retention for the trailing 12 months was 98.34%, down versus the second quarter last year. On a trailing three-month basis, retention was up from the first quarter of this year.

截至 6 月 30 日，訂閱寵物總數年增 8%，達到 [102 萬] 隻寵物。其中包括歐洲約 46,000 隻寵物，目前由第三方承保。過去 12 個月的平均每月保留率為 98.34%，較去年第二季有所下降。從過去三個月來看，留存率比今年第一季有所上升。

Total monthly average revenue per pet for the quarter was $71.72, up 11.4% over the prior year period. The subscription business cost of paying veterinary invoices was $154.6 million, resulting in a value proposition of 74.1% and reflects a 290 basis point improvement over the prior year period. The primary driver of this improvement was margin expansion from our ongoing pricing actions.

該季度每隻寵物的月平均總收入為 71.72 美元，比去年同期增長 11.4%。支付獸醫發票的訂閱業務成本為 1.546 億美元，價值主張為 74.1%，比去年同期提高了 290 個基點。這項改善的主要驅動力是我們持續的定價行動所帶來的利潤率擴張。

The quarter also benefited from prior period development of $2.1 million or approximately 100 basis points of revenue. Our target value proposition for our subscription business remains 71%, and we expect to achieve this in the fourth quarter. As a percentage of subscription revenue, variable expenses were 9.5%, down from 9.7% a year ago.

該季度還受益於前期 210 萬美元的發展，即收入約 100 個基點。我們訂閱業務的目標價值主張仍然是 71%，我們預計在第四季實現這一目標。變動費用佔訂閱收入的百分比為 9.5%，低於一年前的 9.7%。

Fixed expenses as a percentage of revenue were 5.3%, up from 5.1% in the prior year period. Our remediation work on material weaknesses is ongoing, and this increase in spending continues to be in line with our expectations. After the cost of paying veterinary invoices, variable expenses and fixed expenses, we calculate our adjusted operating income.

固定費用佔收入的比例為 5.3%，高於去年同期的 5.1%。我們對重大缺陷的補救工作正在進行中，支出的增加繼續符合我們的預期。在支付獸醫發票成本、變動費用和固定費用後，我們計算調整後的營業收入。

Our subscription business delivered adjusted operating income of $23 million, an increase of 63% from last year. Subscription adjusted operating margin was 11% of subscription revenue. This is up from 8.2% in the prior year quarter and represents approximately 280 basis points of year-over-year margin expansion as pricing takes hold.

我們的訂閱業務調整後營業收入為 2,300 萬美元，比去年成長 63%。訂閱調整後的營業利益率為訂閱收入的 11%。這高於去年同期的 8.2%，隨著定價的確立，利潤率年增約 280 個基點。

Now I'll turn to our other business segment, which is comprised of revenue from other products and services that generally have a B2B component and a lower margin profile than our subscription business. Our other business revenue was $106.2 million for the quarter, an increase of 9% year over year.

現在我將轉向我們的其他業務部門，該部門由其他產品和服務的收入組成，這些產品和服務通常具有 B2B 成分，且利潤率低於我們的訂閱業務。本季我們的其他業務收入為 1.062 億美元，年增 9%。

The decelerating growth within this segment is expected as one of our partners, Pets Best continues to enroll pets with their new underwriter. Adjusted operating income for this segment was $1.8 million, a decrease of 32% from last year, driven by a lower gross margin.

由於我們的合作夥伴之一 Pets Best 繼續透過新的承銷商註冊寵物，因此預計該細分市場的成長將放緩。由於毛利率較低，該部門調整後的營業收入為 180 萬美元，比去年下降 32%。

This is consistent with our revised agreement with Pets Best, which has lower capital requirements and a different margin profile. In total, adjusted operating income was $24.8 million in Q2, up 48% from Q2 last year and ahead of our expectations.

這與我們與 Pets Best 修訂後的協議一致，後者的資本要求較低，保證金狀況也不同。總體而言，第二季調整後營業收入為 2,480 萬美元，比去年第二季成長 48%，超出了我們的預期。

In Q2, our higher-margin subscription business comprised approximately 93% of our adjusted operating income. This is up from 84% for the full year in 2023. As Margi mentioned earlier, we acquired approximately 64,300 new subscription pets in the quarter and deployed $15.8 million to do so. Excluding the approximate 3,600 new European pets that are underwritten by a third party, this translated into an average pet acquisition cost of $231 per pet in the quarter, slightly down from $236 in the prior year period.

第二季度，我們的利潤率較高的訂閱業務約佔調整後營業收入的 93%。這比 2023 年全年的 84% 有所上升。正如 Margi 之前提到的，我們在本季度購買了大約 64,300 隻新訂閱寵物，並為此投入了 1,580 萬美元。不包括由第三方承保的約 3,600 隻新歐洲寵物，這意味著本季每隻寵物的平均寵物採購成本為 231 美元，略低於去年同期的 236 美元。

The estimated internal rates of return on this spend was 37% in the quarter, in line with our target of 30% to 40%. We also invested $1.7 million in the quarter in development costs, which relate primarily to our expansion efforts in Europe.

本季這筆支出的估計內部報酬率為 37%，符合我們 30% 至 40% 的目標。我們還在本季投資了 170 萬美元的開發成本，這主要與我們在歐洲的擴張工作有關。

Stock-based compensation expense was $8.4 million during the quarter. As a result, net loss was $5.9 million or a loss of $0.14 per basic and diluted share compared to a loss of $13.7 million or a loss of $0.33 per basic and diluted share in the prior year period.

本季股票補償費用為 840 萬美元。結果，淨虧損為 590 萬美元，或每股基本股和稀釋股虧損 0.14 美元，而上年同期虧損 1,370 萬美元，或每股基本股和稀釋股虧損 0.33 美元。

In terms of cash flow, operating cash flow was $6.9 million in the quarter compared to a negative $3.4 million in the prior year period. Capital expenditures totaled $2.9 million, down from $4.7 million in Q2 last year. As a result, free cash flow was $4 million, a $12.1 million improvement from the prior year second quarter.

在現金流方面，本季營運現金流為 690 萬美元，去年同期為負 340 萬美元。資本支出總計 290 萬美元，低於去年第二季的 470 萬美元。結果，自由現金流為 400 萬美元，比去年第二季增加了 1,210 萬美元。

As we mentioned in our last earnings call, our free cash flow is seasonal, with the majority typically generated in the second half of the year. So we are particularly pleased with our execution this quarter, achieving the highest Q2 free cash flow since the company went public.

正如我們在上次財報電話會議中提到的，我們的自由現金流是季節性的，通常在下半年產生。因此，我們對本季的執行情況感到特別滿意，實現了公司上市以來第二季最高的自由現金流。

On our third-quarter 2023 earnings call, we introduced an annual free cash flow target at 2.5% of revenue. I am pleased to report that we are making great progress towards this goal and have now generated $23.9 million of free cash flow over the last four quarters. This compares to a negative $31.1 million in the previous 4 quarters and represents an improvement of $55 million.

在 2023 年第三季財報電話會議上，我們提出了年度自由現金流目標為營收的 2.5%。我很高興地向大家報告，我們在實現這一目標方面取得了巨大進展，在過去四個季度中已經產生了 2,390 萬美元的自由現金流。與前 4 個季度的負 3,110 萬美元相比，這一數字增加了 5,500 萬美元。

Turning to the balance sheet. We ended the quarter with $277.2 million in cash and short-term investments. Outside of our insurance entities, we held $33.2 million in cash and short-term investments with an additional $15 million available under our credit facility.

轉向資產負債表。截至本季末，我們的現金和短期投資為 2.772 億美元。除了我們的保險實體之外，我們還持有 3,320 萬美元的現金和短期投資，另外還有 1,500 萬美元的信貸額度可供使用。

At the end of the quarter, we maintained $263 million of capital surplus at our insurance subsidiaries, which was $130.3 million more than the estimated risk-based capital requirement of $132.7 million. Excess capital has increased by $66.2 million year to date due to our growth in our other business slowing as well as recently approved changes to underwriting risk factors used in the calculation of risk-based capital requirements by the NAIC. We expect to discuss these changes in more detail during our upcoming Investor Day.

截至本季末，我們的保險子公司保持了 2.63 億美元的資本盈餘，比預計的基於風險的資本要求 1.327 億美元多了 1.303 億美元。由於我們其他業務的成長放緩以及最近批准的 NAIC 在計算基於風險的資本要求時所使用的承保風險因素的變化，今年迄今為止，超額資本增加了 6,620 萬美元。我們希望在即將到來的投資者日期間更詳細地討論這些變化。

I will now turn to our outlook. We are updating our full-year revenue guidance, which is now expected to be in the range of $1.23 billion to $1.279 billion or 15% growth at the midpoint. This takes into account our overperformance in first half. We are narrowing the range for subscription revenue, which is now expected to be between $850 million and $858 million. The midpoint of the range is increasing slightly and represents 20% growth year over year.

我現在談談我們的展望。我們正在更新全年營收指引，目前預計在 12.3 億美元至 12.79 億美元之間，中間值成長 15%。這考慮到了我們上半年的超常表現。我們正在縮小訂閱收入的範圍，目前預計在 8.5 億美元至 8.58 億美元之間。該範圍的中點略有增加，較去年同期成長 20%。

We are also narrowing the range of our adjusted operating income guidance, now expected to be between $108 million and $115 million. We are raising the midpoint of the range, which represents 33% year-over-year growth. We continue to expect that our subscription margin will increase as we move through the year and build back to a 15% adjusted operating margin in Q4 of this year.

我們也縮小了調整後營業收入指引的範圍，目前預計在 1.08 億美元至 1.15 億美元之間。我們正在提高範圍的中點，即年增 33%。我們繼續預計，隨著今年的進展，我們的認購利潤率將會增加，並在今年第四季調整後的營業利潤率恢復到 15%。

For the third quarter of 2024, total revenues are expected to be in the range of $319 million to $324 million, representing 12% year-over-year growth at the midpoint. Subscription revenue is expected to be in the range of $217 million to $219 million or 19% year-over-year growth at the midpoint.

2024 年第三季度，總營收預計在 3.19 億美元至 3.24 億美元之間，中位數年增 12%。訂閱收入預計在 2.17 億美元至 2.19 億美元之間，中間值年增 19%。

Total adjusted operating income is expected to be in the range of $27 million to $29 million. As a reminder, our revenue projections are subject to conversion rate movements predominantly between the U.S. and Canadian currencies.

調整後營業收入總額預計在 2,700 萬美元至 2,900 萬美元之間。提醒一下，我們的營收預測主要受美元和加拿大貨幣之間匯率變動的影響。

For the third quarter and full year of 2024, we used a 73% conversion rate in our projections, which was the approximate rate at the end of June. With that, I'll hand it back to Margi.

對於 2024 年第三季和全年，我們在預測中使用了 73% 的轉換率，這是 6 月底的近似匯率。說完，我會把它還給瑪姬。

Thank you, Fawwad. Before we take our first question, we'd like to invite you to join us for our upcoming Investor Day on September 18 at our headquarters in Seattle.

謝謝你，福瓦德。在回答第一個問題之前，我們想邀請您參加 9 月 18 日在我們西雅圖總部舉行的投資者日活動。

This annual event is a great opportunity for investors to hear directly from over 20 team members and leading the execution of our six-month plan in an open Q&A forum. We will provide updates across each of our P&Ls and dive into progress across key metrics such as retention rates, pricing, pet growth, hospital activity and PAC. The team and I look forward to seeing many of you there.

這次年度活動為投資者提供了一個絕佳的機會，可以直接聽取 20 多名團隊成員的意見，並在公開的問答論壇中領導我們六個月計劃的執行。我們將提供每項損益表的最新信息，並深入了解保留率、定價、寵物生長、醫院活動和 PAC 等關鍵指標的進展。我和我的團隊期待在那裡見到你們中的許多人。

More details, including registration can be found on our Investor Relations website. With that, we'll open it up for questions.

更多詳細信息，包括註冊，請訪問我們的投資者關係網站。至此，我們將開放提問。

(Operator Instructions) Maria Ripps, Canaccord.

（操作員說明）Maria Ripps，Canaccord。

So now with the rate approval in California, can you maybe share a little bit more color around your plans to expand your customer acquisition efforts instead of in your core geographies? And are there any sort of new strategies or new techniques that you may be planning to deploy now? And when should we see sort of these efforts impacting your overall subscriber count?

現在，隨著加州的利率獲得批准，您能否就擴大客戶獲取工作而不是核心地區的計劃分享更多資訊？您現在是否計劃部署任何新策略或新技術？我們什麼時候應該看到這些努力會影響您的總訂戶數量？

Yes, Maria. So to start with in terms of California, obviously, very pleased to get those two big state approvals during the quarter. That really does expand our overall marketable -- addressable market now to over 85%, which is exactly what we were hoping for.

是的，瑪麗亞。首先就加州而言，顯然，我們很高興在本季度獲得這兩個重大州的批准。這確實將我們的整體可銷售市場擴大到了 85% 以上，而這正是我們所希望的。

We've stressed repeatedly that for us to be able to grow and put our foot on the gas in any of the different markets and cohorts we work with is really to ensure that we have that margin strength, we're priced appropriately for sustainable growth. We now feel that way for most of the country, as I mentioned, most of North America.

我們一再強調，對我們來說，能夠在任何不同的市場和與我們合作的群體中成長並立足，實際上是為了確保我們擁有這樣的利潤實力，我們的定價適合可持續增長。正如我所提到的，我們現在對這個國家的大部分地區，以及北美的大部分地區都有這種感覺。

So we're looking forward to expanding gradually into California. The reality of that spend, to the second part of your question really leans into ensuring that we have both a strong lead development funnel, which is really primarily from the vet channel.

因此，我們期待著逐步擴展到加州。對於你問題的第二部分，這筆支出的實際情況實際上是為了確保我們擁有強大的領先開發管道，而這實際上主要來自獸醫管道。

And then looking at the conversion side of the funnel, which is pulling people through in terms of education, making sure they understand why Trupanion and really reinforcing that sales point. So for us, what we're looking at is expanding on the good lead development that's been happening over the last few weeks, not just in California, but across the market.

然後看看漏斗的轉換面，它在教育方面引導人們通過，確保他們理解為什麼 Trupanion 並真正強化了這個銷售點。因此，對我們來說，我們正在關注的是擴大過去幾週發生的良好先導開發，不僅在加州，而且在整個市場。

And then starting to pull more of those people through the funnel. I expect the growth to start to pick up, like we've said before, very much in line with expectations towards the back half of this year, as we move into the summer months as more people are getting their pets, they're out. They're thinking about pet health we're starting to see that grow.

然後開始吸引更多的人通過管道。我預計成長將開始回升，就像我們之前說過的那樣，非常符合今年下半年的預期，隨著我們進入夏季，越來越多的人開始養寵物，它們會出去。他們正在考慮寵物健康，我們開始看到這種增長。

So I'd expect to that growth really kind of predominantly show up in the back half of Q3, Q4 and then fully leading into next year as well. So excited to see that coming through and really being able to put our foot on the gas a lot more, as we said, once we see that margin start to come back.

因此，我預計這種成長確實主要出現在第三季和第四季的後半段，然後也將完全持續到明年。正如我們所說，一旦我們看到利潤率開始回升，我們很高興看到這一點的實現，並且真正能夠加強。

Got it. That's very helpful. And then secondly, can you maybe refresh us again on what's driving higher-than-expected other revenue? And if it's still sort of largely driven by Pets Best, can you may be broadly, without getting into a lot of specifics, just broadly talk about sort of the relative economics of Pets Best that you are acquiring now versus sort of why your previous agreement with Pets Best?

知道了。這非常有幫助。其次，您能否再次向我們介紹是什麼推動了其他收入高於預期？如果它仍然很大程度上是由 Pets Best 推動的，您是否可以廣泛地談論一下您現在正在收購的 Pets Best 的相對經濟性以及您之前協議的原因，而不涉及很多具體細節與寵物最好？

Sure, I can take that question. The quarter was from other business or Pets Best was largely similar to Q1. So what we talked about in Q1 was continued roll-off of Pets. Revenue growth was driven by ARPU. That repeated itself in Q2.

當然，我可以回答這個問題。該季度來自其他業務或 Pets Best 的情況與第一季基本相似。所以我們在第一季討論的是寵物的持續推出。收入成長是由 ARPU 推動的。這在第二季又重演了。

So the majority of the revenue increase is related to ARPU. That business continues to be in secular decline. Within our expectations is rolling off pretty much within our expected range. So I would say, we continue to see that trend going forward. This was the first quarter on a year-over-year basis, where we had single-digit revenue in that business.

因此，大部分收入成長與 ARPU 相關。該業務繼續長期下滑。在我們的預期之內，幾乎在我們的預期範圍內滾動。所以我想說，我們繼續看到這種趨勢向前發展。這是第一季與去年同期相比，我們在該業務的收入為個位數。

So again, it speaks to the secular downturn as Pets are rolling off, and we expect that to continue.

因此，這再次說明了寵物市場的長期低迷，我們預計這種情況將持續下去。

Brandon Vazquez, William Blair.

布蘭登·巴斯克斯，威廉·布萊爾。

First one, I think, if I heard you correctly, you said retention was up on a year-over-year basis and even sequentially. Kind of curious if you think that we are -- have hit a trough here and we're kind of on the rebound back up and we won't go backwards. Kind of curious your thoughts around that and really what's driving the improvement in retention despite the fact that you guys are still pushing through some decent price increases.

第一個，我想，如果沒聽錯的話，你說留存率逐年上升，甚至連續上升。如果你認為我們已經觸底了，我們正在反彈，而且不會倒退，那就有點好奇了。有點好奇你們對此的想法，以及真正推動保留率提高的因素，儘管你們仍在推動一些體面的價格上漲。

We are very pleased with retention. I think it's been something that we've talked about now for the last 18 months, as one would expect with that high rate flow coming through. Those rates are driven through cost of goods as we see higher inflation in the [renter] level. And as a product, that's something that we know our members are looking for that value.

我們對保留率感到非常滿意。我認為這是我們在過去 18 個月裡一直在談論的事情，正如人們所期望的那樣，伴隨著高流量的到來。這些利率是由商品成本驅動的，因為我們看到[租戶]水準的通貨膨脹率更高。作為一種產品，我們知道我們的會員正在尋找這種價值。

So in terms of retention, a lot of what the teams have been doing is leaning into our value proposition, leaning into the reason why people choose Trupanion and to start with helping to educate the vets through, which really does help when pets go back into the veterinarian and talk about their rate increases.

因此，就保留率而言，團隊一直在做的很多事情都是傾向於我們的價值主張，傾向於人們選擇 Trupanion 的原因，並從幫助教育獸醫開始，這在寵物返回時確實有幫助。談論他們的費率增加。

For us, though, it's about ensuring that the largest bucket of members, so our largest member retaining group now is in the over 20% bucket. So this has evolved over the last 18 months as more and more rate has gone through, and that's really where the focus has been across the business.

但對我們來說，這是為了確保最大的會員群體，所以我們現在最大的會員保留群體位於超過 20% 的群體中。因此，在過去 18 個月裡，隨著越來越多的費率發生變化，這種情況也發生了變化，這確實是整個業務的重點所在。

So from a member communication perspective, from a contact center point of view, as we manage the claims that come through, every element of the business has been ensuring that value proposition is depicted in the right way. For us now, I think it's hard to say where are we in that journey, but I would tell you that the sample size we have now is well over 55% of our members have received that high level of rate approval, rate increase.

因此，從會員溝通的角度來看，從聯絡中心的角度來看，當我們管理所提出的索賠時，業務的每個要素都在確保以正確的方式描述價值主張。對於我們現在來說，我認為很難說我們在這段旅程中處於什麼位置，但我會告訴你，我們現在擁有的樣本量遠遠超過55%，我們的會員已經獲得了高水平的批准率和增長率。

So at this point, we have some good data to suggest that we're through the bulk of that. And we look forward to having more and more of those rates come through with California, New York rolling on. And then assuming that inflation remains consistent with its expectations in Q1 of 2025, those high-level rate approvals and rate needs should be part of -- in history at this point.

因此，目前，我們有一些很好的數據表明我們已經完成了大部分工作。我們期待著隨著加州和紐約州的不斷發展，越來越多的利率能夠實現。然後假設 2025 年第一季的通膨率與預期保持一致，那麼這些高水準利率批准和利率需求應該成為歷史的一部分。

That's assuming 15, which means it gives us a lot of confidence to be able to ultimately return to those high levels of retention that we got used to 24 months ago. So good about the progress. We're not giving up. We keep focusing on this.

假設為 15，這意味著它給了我們很大的信心，能夠最終恢復到 24 個月前我們習慣的高留存率水準。進展非常好。我們不會放棄。我們持續關注這一點。

And overall, very pleased that we have retention that we believe still to be double that of the industry and it highlights the market that we're in and the vets and the opportunity we have in front of us.

總的來說，我們很高興我們的保留率仍然是該行業的兩倍，這突顯了我們所處的市場、退伍軍人以及我們面前的機會。

And maybe as a follow-up, switching gears a little bit. Now that your IRR has kind of gotten back into the 30% to 40% range and you're talking about increasing PAC, maybe talk to us a little bit about which of the buckets do you start putting a little bit more PAC into?

也許作為後續行動，稍微改變一下方式。現在您的 IRR 已經回到了 30% 到 40% 的範圍，並且您正在談論增加 PAC，也許可以和我們談談您開始在哪些桶中投入更多的 PAC？

I know in the prepared remarks, you talked about the lower cost options, maybe some international. So as that starts to increase, where do we see it go, the next incremental dollar? And then how long does that usually take the flow through and start to reaccelerate pet adds?

我知道在準備好的演講中，您談到了成本較低的選擇，也許是一些國際選擇。那麼，當它開始增加時，我們會看到它去哪裡，下一個增量美元會去哪裡？那麼通常需要多長時間才能開始重新加速寵物添加呢？

So we will go region by region, cohort by cohort. What we look at is a very granular level map of pet by pet, breed, species, geography, which now includes, as you mentioned, those other products. For us, it's about being -- deploying every single PAC dollar diligently, and that will be a combination of what does it take to acquire a lead and what does it take to convert that pet and pull them through the funnel.

因此，我們將逐一地區、逐一隊列地進行研究。我們看到的是按寵物、品種、物種、地理位置劃分的非常精細的寵物地圖，正如您所提到的，現在包括那些其他產品。對我們來說，關鍵在於勤奮地部署 PAC 的每一塊錢，這將是如何獲得領先優勢以及如何轉變寵物並將其拉過漏斗的組合。

And it's a different length of time in terms of attribution to those journeys depending on the channel. So for us, the vet channel has been, will always be our mainstay in terms of where we go and seek to educate pet parents at the ground level. We'll continue to do that.

根據渠道的不同，這些旅程的歸因時間長度也不同。因此，對我們來說，獸醫管道一直是、也將永遠是我們在當地尋求對寵物父母進行教育的支柱。我們將繼續這樣做。

I suspect you're going to see a little bit more noise from a media perspective above the line. So pulling people through from a brand point of view. That not only helps us from a conversion perspective, but it also leans a little bit to retention as well as people see that reinforcement and credibility of the brand.

我懷疑你會從媒體的角度看到更多的噪音。因此，從品牌的角度來吸引人們。這不僅從轉化的角度對我們有幫助，而且還有助於保留，以及人們看到品牌的強化和可信度。

In terms of products, we have been very diligent in ensuring that we are acquiring pets in the right products at the right times. You note that from the fact that our other -- our newer products reduced quarter over quarter as we really lent into the growth in our core. But we'll continue to lean into any of those products we can as and when we see there is a 30% to 40% internal rate of return.

在產品方面，我們一直非常努力地確保我們在正確的時間以正確的產品購買寵物。您注意到，我們的其他新產品逐季減少，因為我們確實促進了核心業務的成長。但當我們看到內部回報率達到 30% 到 40% 時，我們將繼續盡可能地傾向於這些產品。

We'll adhere to that discipline and look forward to actually starting to see that growth pick up, which I suspect you'll see. And like I said at the back half of this year, especially into Q4 as that PAC has returned quarter over quarter at a high level.

我們將遵守這項原則，並期待真正開始看到成長的加速，我想你們也會看到這一點。正如我在今年下半年所說，特別是進入第四季度，因為 PAC 的回報率逐季度保持在高水準。

John Barnidge, Piper Sandler.

約翰·巴尼奇，派珀·桑德勒。

Congrats, Margi. My question, Margi, on your comment about a market participant in the market that dropped out 100,000 pets. Member experience is important for products where the market penetration is low. What's your expectation for other market participants in the rate -- in the backdrop of rate need for some? And does it create an opportunity to acquire books to ensure customers have a good pet experience in a product with that low market penetration?

恭喜，瑪姬。我的問題是，Margi，關於您對市場參與者丟棄 100,000 隻寵物的評論。對於市場滲透率較低的產品來說，會員體驗非常重要。在某些人需要利率的背景下，您對其他市場參與者對利率的期望是什麼？它是否創造了購買書籍的機會，以確保客戶在市場滲透率較低的產品中獲得良好的寵物體驗？

Yes, obviously, for us, this is not a good thing as you say. We never want anyone to have a bad experience in a category that's underpenetrated. We're really leaning into early adopters and helping people to have that best experience from the outset. We know from history that's hurt the category growth back in the '80s when poor experiences were had. I think the learning from here is, first and foremost, horrible situation for those pet parents.

是的，顯然，對我們來說，這並不是你所說的一件好事。我們絕不希望任何人在滲透率不足的類別中獲得糟糕的體驗。我們確實傾向於早期採用者，並幫助人們從一開始就獲得最佳體驗。我們從歷史中知道，這在 80 年代經歷了糟糕的經歷，這損害了品類的成長。我認為從這裡學到的首先是那些寵物父母的可怕處境。

And as a category as an industry, what we need to do is be able to get behind the veterinarians and help them reinforce the fact that players such as Trupanion are creating a product that's sustainable. It really leans into the fact that you have got to understand the costs that go into pricing for those pets. Our aged enrollment pricing is very unique in the industry. We're the only people that do that, and that allows us to have a very clear vision for the lifetime of that pet.

作為一個行業的類別，我們需要做的是能夠支持獸醫並幫助他們強化這樣一個事實：Trupanion 等參與者正在創造一種可持續的產品。這確實取決於這樣一個事實：您必須了解這些寵物的定價成本。我們的老年入學定價在業界非常獨特。我們是唯一這樣做的人，這使我們能夠對寵物的一生有一個非常清晰的願景。

It's not an easy thing to do. I think if you think about the natural hurdles that you have coming into this industry, we've seen a lot of people come in. They've grown very quickly, and they've not got their pricing right. We've proven over the last two years that we are ahead of the industry in terms of being able to react. Even though we berated ourselves 18 months ago for being slow, we were significantly faster than the competition.

這不是一件容易的事。我想如果你考慮進入這個行業所面臨的自然障礙，我們已經看到很多人進入了。他們成長得非常快，但他們的定價並不合適。過去兩年我們已經證明，我們在反應能力方面處於行業領先地位。儘管我們在 18 個月前因為速度慢而責備自己，但我們的速度明顯快於競爭對手。

And for us, I think we're never going to chase a pet count over the lifetime value and making sure that member experience is what it should be. I think we'll lean into the vet channel. We'll continue to share the fact that we are here for the life of the pet. We're here for them. And I think when it comes to acquiring those pets, it's a challenge.

對我們來說，我認為我們永遠不會追求寵物數量超過終身價值，並確保會員體驗是應有的。我想我們會轉向獸醫頻道。我們將繼續分享這樣一個事實：我們是為了寵物的生命而存在的。我們在這裡為他們服務。我認為當談到獲得這些寵物時，這是一個挑戰。

The best member experience is having a puppy, or a kitten or a new pet to the household that doesn't have preexisting conditions that we at Trupanion can cover everything for that pet in that instance.

最好的會員體驗是家裡有一隻小狗、一隻小貓或一隻新寵物，並且沒有預先存在的疾病，在這種情況下，我們 Trupanion 可以為該寵物承保一切費用。

Many of those pets that now are without coverage will have preexisting conditions, and that doesn't set the member up for the best experience. So for us, we'll continue to focus on that early entry point. And obviously, I hope that this doesn't happen for others. And I think it's just a message to everyone that pricing has got to be critical. It's got to be on point.

許多現在沒有保險的寵物都有先前存在的疾病，這並不能讓會員獲得最佳的體驗。因此，對我們來說，我們將繼續關注早期切入點。顯然，我希望這不會發生在其他人身上。我認為這只是向每個人傳達了一個訊息：定價必須至關重要。一定要說到重點。

And I think we've proven that we're starting to see them come out the other side of that and hopefully others will too.

我認為我們已經證明我們開始看到他們走出困境，希望其他人也能做到。

My follow-up question, maybe a numbers one. On the two material weaknesses, what was the size of that cost in the quarter? And where did we see it in the financial results?

我的後續問題，也許是第一個問題。對於這兩個重大弱點，本季的成本有多大？我們在財務表現中哪裡看到了它？

You see the cost in fixed expenses. So fixed expenses were elevated. I think one of the advantages that we have as a company is we have a very clear model P&L. So that model P&L calls for fixed expenses to be 5% of revenue. They ticked up higher as expected, primarily related to the material weakness.

您會看到固定費用的成本。因此固定費用增加了。我認為我們作為一家公司的優勢之一是我們有一個非常清晰的損益模型。因此，此損益模型要求固定費用佔收入的 5%。它們如預期般上漲，主要與材料疲軟有關。

There's a couple of dimensions to it. One are the cost of the actual remediation work. We talked in the last call about bringing out some resources as well as some external expertise. And then the other is just from a technology perspective because one of the MWs had to do with controls within technology.

它有幾個維度。一是實際修復工作的成本。我們在上次電話會議中談到了引入一些資源以及一些外部專業知識。另一個只是從技術角度來看，因為其中一個 MW 與技術內的控制有關。

There's more engineering effort on remediation and so you're seeing higher operating expense versus lower CapEx because more maintenance and support around remediation versus development. So you see it then fixed expense.

修復方面的工程工作量更大，因此您會看到更高的營運費用與更低的資本支出，因為與開發相比，圍繞修復的維護和支援更多。所以你看到了固定費用。

Jon Block, Stifel.

喬恩·布洛克，斯蒂菲爾。

Maybe just the first one. I believe the variable expenses and other was up roughly $7 million Q over Q, sort of like an unusual step up, low base. So call it, like $17 million to $23 million or $16.5 million to $23 million and change. So maybe you could just shed some light on that magnitude of the sequential step up? And then when I shift gears and I just look at where the gross adds are coming from, one of the newer opportunities is sort of like in the other North American subscription, not the core.

也許只是第一個。我相信變動費用和其他費用比 Q 增加了約 700 萬美元，有點像不尋常的提升，基數較低。所以就這麼稱呼吧，例如 1700 萬美元到 2300 萬美元，或者 1650 萬美元到 2300 萬美元，然後再改變。那麼也許你可以闡明一下連續提升的幅度？然後，當我換檔時，我只是看看總增加額來自哪裡，其中一個較新的機會有點像其他北美訂閱，而不是核心。

And I believe that stepped down from 10,000 and change in 1Q to 7,600 in 2Q. I expected that channel to get better, not sort of materially worse Q over Q as you sort of refine the plans and streamlined. And maybe if you could just add some color to both of those, and then I'll ask a shorter follow-up.

我相信這一數字將從第一季的 10,000 人下降到第二季的 7,600 人。我預計這個管道會變得更好，而不是隨著你對計劃的完善和精簡而變得更加糟糕。也許你可以為這兩者添加一些顏色，然後我會問一個更短的後續行動。

Yes, I can take the first one on variable expense. So as we've talked about in the past, the agreement with Pets Best is loss sensitive. And so our margin is relatively insulated from either higher loss ratio or higher variable expense. Rev expense in this case had to do with higher commissions. As that loss ratio was coming down, there's a higher earn.

是的，我可以以可變費用購買第一個。正如我們過去所討論的，與 Pets Best 簽訂的協議對損失敏感。因此，我們的利潤相對不受較高損失率或較高變動費用的影響。在這種情況下，收入費用與較高的佣金有關。隨著損失率下降，收益也隨之增加。

It doesn't affect our operating margin. That's relatively flat quarter over quarter. In the Q1 call, I talked about that being the new run rate for that business based on the new agreement. That's largely consistent with our expectations being flat Q1 to Q2.

它不會影響我們的營業利益率。季度環比相對持平。在第一季的電話會議中，我談到了基於新協議的該業務的新運行率。這與我們第一季至第二季持平的預期基本一致。

And John, just on the gross adds and the other products. So one of the things that we've been learning with those new products is really leaning into what makes a good cohort for us. So they are newer. We're learning how to both get leads and convert those pets and also ultimately retain them. So we're looking at that IRR constantly to understand what's the best lifetime value.

約翰，只是關於總增加值和其他產品。因此，我們從這些新產品中學到的一件事就是真正了解如何成為我們的優秀群體。所以它們比較新。我們正在學習如何獲得線索、轉變這些寵物並最終留住它們。因此，我們不斷關注 IRR，以了解什麼是最佳的終身價值。

What we realized during the quarter is that some of those products are still subscale, so we don't want to be pushing too much in there as we get more rate for our core products. So you're seeing the balance moving back to core, but also really looking at growing the right way. So as we test and refine from a new product and new channel distribution perspective, we realize that some of the pets who are enrolling are not going to have that stickiness that we typically would be used to.

我們在本季意識到，其中一些產品仍然規模較小，因此我們不想在其中投入太多，因為我們的核心產品獲得了更高的利率。所以你會看到平衡回到核心，但也真正在考慮以正確的方式成長。因此，當我們從新產品和新通路分銷的角度進行測試和改進時，我們意識到一些正在註冊的寵物不會具有我們通常習慣的黏性。

So the teams have slowed down that growth very deliberately, looked at how do we really deploy that PAC in the best way to get the right mix of pets. And we're making some really good progress there. So the beauty of having these different distribution channels, these different products is that we do now have a choice. We don't just have to grow in one country, one geography, one product, and we're leaning into that flexibility depending, but always thinking about that 30% to 40% internal rate of return ultimately.

因此，團隊非常有意地放慢了這種增長速度，研究了我們如何以最佳方式真正部署 PAC 以獲得正確的寵物組合。我們正在這方面取得一些非常好的進展。因此，擁有這些不同的分銷管道、這些不同的產品的美妙之處在於我們現在有了選擇。我們不僅需要在一個國家、一個地區、一種產品上成長，而且我們傾向於依賴這種靈活性，但始終考慮最終 30% 到 40% 的內部回報率。

Helpful color. And then just the second question, sort of a follow-up to a question that was asked earlier, but from a different perspective. On that competitor that churned off the 100,000 or so subscribers, what's been the reaction not so much from the pet owner experience but from the veterinarian community? Your biggest channel is going through the vets. You want them to stand behind, endorse, bring up pet insurance and feel comfortable.

有用的顏色。然後是第二個問題，有點像是之前提出的問題的後續問題，但從不同的角度來看。對於那個吸引了大約 10 萬名訂閱者的競爭對手，寵物主人和獸醫界的反應如何？你最大的渠道是透過獸醫。您希望他們支持、支持、提出寵物保險並感到放心。

One of the assets that you brought initially to the industry was a transparent plan that was simple and easy to explain. And when they hear about something that this going on, do they have more trepidation when they're engaging with pet owners?

您最初為該行業帶來的資產之一是一個簡單且易於解釋的透明計劃。當他們聽到正在發生的事情時，在與寵物主人交往時是否會更加恐懼？

That is a great question. And honestly, for us, that's really where we felt the initial need to educate our territory partners. So as you know, these are the people who are going in the doors of veterinary hospitals, speaking to vets. They did have this conversation. It continues to be a pain point for vets.

這是一個很好的問題。老實說，對我們來說，這確實是我們最初感到需要教育我們的地區合作夥伴的地方。如您所知，這些人走進獸醫院的大門，與獸醫交談。他們確實有過這樣的談話。這仍然是獸醫的痛點。

As you can imagine, many of their clients are going through this experience month over month. And it, frankly, is an opportunity for Trupanion. We're there. We can explain firsthand not only what that situation -- what leads to that type of situation, but also to reinforce the fact that in our coverage, Trupanion cannot just cancel a pet because we feel like canceling a pet. We are adhering to our lifetime value, to our pricing promise. And from our perspective, it's critical that vets know that and trust it.

正如您可以想像的那樣，他們的許多客戶都在經歷這種經歷。坦白說，這對特魯帕尼翁來說是一個機會。我們就在那裡。我們不僅可以直接解釋這種情況是什麼——是什麼導致了這種情況，而且還可以強調這樣一個事實：在我們的報導中，Trupanion 不能僅僅因為我們想取消寵物而取消寵物。我們恪守我們的終身價值和我們的定價承諾。從我們的角度來看，獸醫了解並信任這一點至關重要。

What I would say is an indicator based on those conversations as we're seeing in the last few weeks, our veterinary lead traffic is higher than it's ever been before. We're not pushing too hard on the conversion funnel yet, but that's a very good sign. It shows that we're able to demonstrate how we're different and why we're different.

我想說的是基於過去幾週我們所看到的這些對話的指標，我們的獸醫潛在客戶流量比以往任何時候都高。我們還沒有在轉換管道上大力推動，但這是一個非常好的跡象。它表明我們能夠展示我們如何與眾不同以及我們為何與眾不同。

And to that point you made, that transparency in terms of our policy wording and our coverage has been critical to both get the trust of the vets and also retain the trust of the vets as they see this type of thing happening in the industry.

就您所說的這一點而言，我們的政策措辭和覆蓋範圍方面的透明度對於獲得退伍軍人的信任以及保持退伍軍人的信任至關重要，因為他們看到了行業中發生的此類事情。

Katie Sakys, Autonomous Research.

凱蒂·薩克斯，自主研究。

I wanted to circle back really quickly on the discussion for retention. Margi, would you be willing to quantify the extent to which retention improved on a trailing three-month basis for us?

我想快速回顧一下有關保留的討論。Margi，您願意量化我們過去三個月的留任率改善程度嗎？

We haven't shared that level of detail. But I think from the perspective of our core business, we've seen it improve ahead of our other products, which for us is symptomatic of really focusing on that and doubling down on that big cohort. Because it's now today, it's over 55% of our members. But the expansion is moving very nicely, and we're very happy with our performance. It's pretty much in line with expectations.

我們還沒有分享那麼詳細的資訊。但我認為，從我們核心業務的角度來看，我們已經看到它領先於我們的其他產品，這對我們來說是真正專注於這一領域並加倍投入這一大群體的症狀。因為到了今天，我們的會員超過了 55%。但資料片的進展非常順利，我們對我們的表現非常滿意。與預期基本相符。

Shifting to ARPU really quickly. It's impressively held in at almost 10% for the second quarter in a row now. Can you guys give any color on where you expect that to trend over the back half of the year as the remaining 45% of the book experiences those rate increases? And then perhaps adjacent to that, is there any portion of the book, and if so, what percentage that would face those large rate increases in the beginning of 2025?

轉向 ARPU 的速度非常快。令人印象深刻的是，該比例目前已連續第二季維持在近 10%。你們能否對今年下半年的趨勢給出任何顏色，因為本書的其餘 45% 會經歷這些比率的成長？或許與此相鄰的是，這本書中是否有任何部分，如果有，那麼在 2025 年初將面臨大幅加息的百分比是多少？

Yes, I can give some context just on the second half. Our expectation is kind of similar to what we saw in first half. This was a year that was going to be driven by more so ARPU than pet count given that we've been pulling back on acquisition spend.

是的，我可以就下半場提供一些背景資訊。我們的預期與上半年的情況類似。鑑於我們一直在削減收購支出，今年的推動力將是 ARPU，而不是寵物數量。

We saw that in Q2, where it was balanced, but a little bit more lean towards ARPU as a contributor to top line growth from a subscription perspective. We expect as that pricing flows through similar to what we saw in prior years where you have first half being relatively flat sequentially and then expansion of margin in the second half.

我們在第二季度看到了這一點，雖然它是平衡的，但從訂閱的角度來看，ARPU 更傾向於作為收入成長的貢獻者。我們預計，定價流程與我們前幾年看到的情況類似，上半年相對持平，下半年利潤率擴大。

A lot of that expansion in the second half is going to be driven by the benefit of that ARPU in our highest categories. As Margi mentioned, we are going to be increasing investment in acquisition. We're gradually increasing that, again now that margins are closer to our target range. That's more an investment that's going to benefit us in the first half of next year. We want to hit the ground running from an acquisition standpoint. So I would say the second half is still going to be largely driven by ARPU.

下半年的擴張很大程度上將由我們最高類別中 ARPU 的優勢推動。正如 Margi 所提到的，我們將增加收購方面的投資。現在，我們正在逐漸增加這一點，因為利潤率已經接近我們的目標範圍。這更是一項將使我們在明年上半年受益的投資。我們希望從收購的角度開始行動。所以我想說下半年仍然主要由 ARPU 驅動。

And then just in terms of the members facing large increases in 2025, for us, by the time we get to the end of this year, our book of business will have received the biggest increase unless we see an increase in inflation above the 15% in Q1. Now that we've level set the delta that we had from prior periods, we feel good about the fact that we have sufficient pricing flowing through the book of business that will have affected the entire book.

然後就 2025 年面臨大幅成長的會員而言，對我們來說，到今年年底時，我們的業務量將獲得最大增長，除非我們看到通貨膨脹率上升至 15% 以上在第一季。既然我們已經設定了之前時期的增量，我們對我們有足夠的定價流經業務簿這一事實感到滿意，這將影響整個業務簿。

And by the time we get to Q1, our pricing that we have today will hold at that level, so we shouldn't see the need to go above a 20% increase again next year. Obviously, that's dependent on inflation. If we do see inflation move up, then our rates will move up again.

到第一季時，我們今天的定價將保持在這個水平，因此我們認為明年不需要再次上漲 20% 以上。顯然，這取決於通貨膨脹。如果我們確實看到通膨上升，那麼我們的利率將再次上升。

But we feel like we're in a pretty stable stage and look forward to being able to really focus on moving more of our members back to that sub-20% retention group over the next 12 months.

但我們覺得我們正處於一個相當穩定的階段，並期待能夠真正專注於在未來 12 個月內將更多的會員帶回低於 20% 的保留群體。

Wilma Burdis, Raymond James.

威爾瑪·布爾迪斯，雷蒙德·詹姆斯。

We see some industry articles discussing lower-than-normal vet visits in 2Q '24. Just curious if you saw any of those types of trends in the quarter.

我們看到一些行業文章討論了 2024 年第二季度獸醫就診次數低於正常水平。只是好奇您是否在本季度看到了任何此類趨勢。

So our data actually suggests otherwise. We've definitely been following those trends in the industry. Typically, what we find and what we've always found with the Trupanion member is that they do go to the vet more frequently than an uninsured client. It removes barriers to care. It removes barriers to entry.

所以我們的數據實際上表明情況並非如此。我們確實一直在關注行業的這些趨勢。通常情況下，我們發現 Trupanion 會員確實比沒有保險的客戶更頻繁地去看獸醫。它消除了護理障礙。它消除了進入壁壘。

So people when they see an issue with their pet will go to the veterinarian without waiting, without pausing. We've been leaning in a lot to the industry and hearing what's been happening from our territory partners and from the markets in general. And what we're hearing is there are a couple of things at play here.

因此，當人們發現自己的寵物出現問題時，他們會毫不猶豫地去看獸醫。我們一直在密切關注該行業，並從我們的地區合作夥伴和整個市場中了解了正在發生的事情。我們聽到的是，這裡有一些因素在起作用。

One, down to the fact that puppies and kittens are not being purchased in the same levels as they were 2 years ago. So there's less new visits. There's less new clients coming to the hospital, which is driving part of that business pattern down.

一是小狗和小貓的購買量與兩年前不同。所以新來訪的人比較少。來醫院的新客戶越來越少，這導致部分業務模式下降。

The other is, anecdotally, we're hearing people are waiting to see how their pet does before they take them to the veterinarian, which obviously is not ideal for a pet parent to have to do. But when they're thinking about their finances and they're concerned about what that's going to cost, they're waiting.

另一種說法是，我們聽說人們在帶寵物去看獸醫之前會等著看他們的寵物表現如何，這顯然對寵物父母來說並不理想。但當他們考慮自己的財務狀況並擔心這將花費多少時，他們就會等待。

And from our point of view, again, speaking to the point I made earlier, we're actually seeing more and more veterinarians leaning into the fact that they realize the higher proportion of their clients that are coming in are Trupanion members. And so they're recognizing the value that we offer to them and helping to generate more lead volume as a result of that.

從我們的角度來看，再次談到我之前提出的觀點，我們實際上看到越來越多的獸醫傾向於這樣一個事實：他們意識到來訪的客戶中有越來越多的比例是Trupanion 會員。因此，他們認識到我們為他們提供的價值，並因此幫助產生更多的潛在客戶數量。

So it's counterintuitive initially, but when you think about the type of person that we attract and the members we have, that's why our patterns are slightly different. We are seeing, I would just add, a slight downturn in July in terms of visits. So we'll wait and see what happens there. But so far, our assumptions are remaining at 15%.

所以一開始這是違反直覺的，但是當你考慮我們吸引的人類型以及我們擁有的成員時，這就是為什麼我們的模式略有不同。我想補充一點，我們看到 7 月的訪問量略有下降。所以我們將拭目以待，看看那裡會發生什麼。但到目前為止，我們的假設仍維持在 15%。

Okay. And then you raised the EBITDA by $2 million in the quarter. Could you just talk about where that piece is coming from or what business line it's driven by? Was it in other subscription? Or was there some other impact? Just if you could just help us bridge that.

好的。然後，您在本季將 EBITDA 提高了 200 萬美元。您能否談談該作品的來源或它由哪些業務線驅動？是在其他訂閱中嗎？或是有其他影響嗎？如果你能幫我們解決這個問題就好了。

Our profitability is primarily driven by subscription overwhelmingly. The margin on the other businesses is relatively small. So the contributors are largely AOI driven. So the more AOI we're generating as a result of the ARPU flow-through that we talked about as well as continuing to enroll pets. So feel good about it, again, largely within line with our expectations.

我們的獲利能力主要是由訂閱驅動的。其他業務的利潤率相對較小。所以貢獻者主要是 AOI 驅動的。因此，由於我們所討論的 ARPU 流量以及繼續註冊寵物，我們產生的 AOI 就越多。所以再次感覺良好，很大程度符合我們的預期。

When we think about the overall plan first half versus second half, we feel good about exiting the first half with some momentum and that bodes well for us in terms of having some optimism on the second half.

當我們考慮上半場與下半場的總體計劃時，我們對帶著一些動力退出上半場感覺良好，這對我們對下半場保持樂觀來說是個好兆頭。

There are no more questions in the queue. This concludes our question-and-answer session. Thank you for attending today's presentation. You may now disconnect.

隊列中沒有更多問題。我們的問答環節到此結束。感謝您參加今天的演講。您現在可以斷開連線。