Brown & Brown, Inc.

Second-quarter revenue was $1.700 billion, up 30.4% year over year. Adjusted EBITDAC margin was 35.7%, down 100 basis points, and adjusted EPS increased 3.9% to $1.07. Total revenues for the specialty distribution segment grew 28.1% and retail total revenues grew 35.9%, while retail organic growth was 2.5% including contingents and 1.5% excluding contingents; specialty distribution organic revenue was negative 1.6% including contingents and negative 3.5% excluding contingents. Cash flow from operations was approximately $610 million in the first half, up $70 million or 13% from the first half of 2025. For the second half, management expects retail organic growth excluding contingents of 1.5% to 2.5% and specialty distribution organic growth excluding contingents of 2% to 4%. They also reaffirmed synergy targets of $30 million to $40 million this year.

Powell Brown said the company is focused on organic growth, hiring talented people, buybacks, and selective strategic acquisitions rather than scale for its own sake. He emphasized that AI partnerships with McKinsey, Accenture, and Anthropic are meant to improve customer outcomes, speed, and productivity, not replace brokers or risk advisers. His tone was constructive but measured: he said the team is making progress, but retail organic growth is still not where they want it to be and CAT property pricing remains under pressure.

Andy Watts highlighted consolidated revenue of $1.700 billion, EBITDAC margin of 35.7%, and diluted EPS of $1.07. He said the margin decline was driven substantially by lower interest income versus last year, when the company was holding cash ahead of the Accession purchase. He also noted approximately $410 million of Accession revenue in the quarter, approximately $610 million of operating cash flow in the first half, $500 million deployed to repurchase shares over the past 6 months, and a $400 million debt maturity coming due in December. He said the company still expects long-term cash conversion of 24% to 27% and does not currently expect incremental technology spend to change margin guidance.

Analysts pressed on Accession timing, revenue seasonality, and whether the business was still on track with prior annual revenue expectations; management said quarterly revenue is relatively balanced, July is a big month, and the business remains in the expected range. Questions also focused on whether lower industry pricing would hurt contingents, but management said retail contingents are settled with a lag and specialty distribution contingents are calculated program by program based on Brown & Brown’s own profitability, not a direct industry-wide correlation. Several analysts asked about AI spend and margin risk, and management replied that current AI-related investments are being funded through reallocation rather than incremental spend, though benefits are expected over years 3 to 5. Buybacks and the $400 million December debt maturity were also discussed, with management saying it will evaluate refinancing and repayment options in the fourth quarter.