Trupanion’s Average Customer Retention Reaches 98.38% in Q3 as Improvement Continues
Key Facts
Trupanion reported average monthly retention of 98.38% in the third quarter of 2026, compared with 98.33% in the same period a year earlier, marking year-over-year improvement for the seventh consecutive quarter. This came alongside growth in the subscription base and a decline in total enrolled pets, highlighting the different trends in the subscription business compared with the rest of the company. Subscription-enrolled pets totaled 1,145,160 as of September 30, up 6% year over year. By contrast, total enrolled pets stood at 1,626,901, down 2% from a year earlier. CEO Margi Tooth said the quarter included continued improvement in customer retention and higher profitability.
Cash flow data showed improvement from the third quarter of 2025, with operating cash flow of $30.7 million, compared with $29.2 million a year earlier. Free cash flow was $28.5 million, up from $23.9 million in the comparable period. Tooth described quarterly cash flow as a record and linked the results to increased profitability. She also said Trupanion repurchased approximately $25 million of shares during the quarter. Alongside improved retention, these cash flow indicators offer a broader picture of the company’s performance than enrollment growth figures alone.
A comparison of enrollment with the prior quarter shows subscription growth continued despite an annual decline in total enrolled pets. As of June 30, 2026, subscription-enrolled pets totaled 1,124,548, up 5% year over year, while total enrolled pets reached 1,633,131, down 2%. Second-quarter revenue was $392.9 million, up 11% year over year. By September 30, subscription-enrolled pets had risen to 1,145,160, with annual growth at 6%, while the year-over-year decline in total enrollment remained 2%. Second-quarter revenue remains a separate historical comparison from the company’s outlook for the following quarter.
Trupanion expects total revenue of between $407 million and $414 million in the fourth quarter of 2026, including subscription revenue of between $297 million and $299 million. At the midpoint of the subscription revenue outlook, that would represent year-over-year growth of approximately 14%, the company said. The estimates indicate the path the company expects for its subscription business after the number of enrolled pets grew 6% year over year at the end of September. Total enrolled pets remain down 2% year over year, making the divergence between subscription-base performance and total enrollment a notable feature of enrollment results. The fourth-quarter outlook is set to be a focal point in tracking revenue performance.
On liquidity, cash and short-term investments totaled $396.8 million on September 30, 2026. The company repaid $15 million of its credit facility in October, after the quarter ended. A further $18.5 million remained available under the facility after the repayment, according to its quarterly report. These figures provide financial context for the cash flows the company reported for the quarter, while distinguishing the September-end balance from the subsequent October repayment. Tooth also cited the share repurchases during the quarter, valued at approximately $25 million.
Enrollment trends are also tied to the company’s agreement with Pets Best, which Trupanion said will end after the third quarter of 2028. The company expects enrollments associated with this business to continue declining as the business transitions to other underwriters. Separately, TRUP shares closed at $36.75 on November 6, 2026. The company had listed its third-quarter earnings conference for November 5 at 4:30 p.m. Eastern time, when investors could hear the results explained. The Pets Best agreement’s end date, alongside the fourth-quarter outlook, provides context for what markets will monitor in coming periods.