Insurance company Progressive (NYSE: PGR) fell short of the market’s revenue expectations in Q2 CY2025, but sales rose 15.7% year on year to $20.99 billion. Its GAAP profit of $5.40 per share was 14.8% above analysts’ consensus estimates.

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Company Overview

Starting as a small auto insurance company in 1937 with a pioneering focus on high-risk drivers, Progressive (NYSE: PGR) is a major auto, property, and commercial insurance provider that offers policies through independent agents, online platforms, and over the phone.

Revenue Growth

Insurers earn revenue three ways. The core insurance business itself, often called underwriting and represented in the income statement as premiums earned, is one way. Investment income from investing the “float” (premiums collected upfront not yet paid out as claims) in assets such as fixed-income assets and equities is the second way. Fees from various sources such as policy administration, annuities, or other value-added services is the third.

Over the last five years, Progressive grew its revenue at an exceptional 14.9% compounded annual growth rate. Its growth surpassed the average insurance company and shows its offerings resonate with customers, a great starting point for our analysis.

Long-term growth is the most important, but within financials, a half-decade historical view may miss recent interest rate changes and market returns. Progressive’s annualized revenue growth of 20.7% over the last two years is above its five-year trend, suggesting its demand was strong and recently accelerated. Note: Quarters not shown were determined to be outliers, impacted by outsized investment gains/losses that are not indicative of the recurring fundamentals of the business.

This quarter, Progressive’s revenue grew by 15.7% year on year to $20.99 billion but fell short of Wall Street’s estimates.

Net premiums earned made up 94.8% of the company’s total revenue during the last five years, meaning Progressive lives and dies by its underwriting activities because non-insurance operations barely move the needle.

Markets consistently prioritize net premiums earned growth over investment and fee income, recognizing its superior quality as a core indicator of the company’s underwriting success and market penetration.

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Book Value Per Share (BVPS)

Insurance companies are balance sheet businesses, collecting premiums upfront and paying out claims over time. The float–premiums collected but not yet paid out–are invested, creating an asset base supported by a liability structure. Book value per share (BVPS) captures this dynamic by measuring these assets (investment portfolio, cash, reinsurance recoverables) less liabilities (claim reserves, debt, future policy benefits). BVPS is essentially the residual value for shareholders.

We therefore consider BVPS very important to track for insurers and a metric that sheds light on business quality. While other (and more commonly known) per-share metrics like EPS can sometimes be lumpy due to reserve releases or one-time items and can be managed or skewed while still following accounting rules, BVPS reflects long-term capital growth and is harder to manipulate.

Progressive’s BVPS grew at an incredible 15% annual clip over the last five years. BVPS growth has also accelerated recently, growing by 41.7% annually over the last two years from $27.71 to $55.62 per share.

Over the next 12 months, Consensus estimates call for Progressive’s BVPS to grow by 24.9% to $54.33, elite growth rate.

Key Takeaways from Progressive’s Q2 Results

We enjoyed seeing Progressive beat analysts’ EPS expectations this quarter. We were also happy its book value per share outperformed Wall Street’s estimates. On the other hand, its revenue missed. Overall, this print had some key positives. The stock traded up 4.3% to $252.53 immediately after reporting.

Progressive had an encouraging quarter, but one earnings result doesn’t necessarily make the stock a buy. Let’s see if this is a good investment. When making that decision, it’s important to consider its valuation, business qualities, as well as what has happened in the latest quarter. We cover that in our actionable full research report which you can read here, it’s free.