10-Q · April 30, 2026
Lemonade reported Q1 2026 revenues of $258 million, exceeding estimates of $252.43 million, and an EPS loss of $0.47, beating expectations of a $0.57 loss. The company experienced a 32% growth in in-force premiums…
Earnings analysis · 10-Q
LMND earnings analysis
Filed August 4, 2026 · Our reading of the company's report
The latest report
Lemonade reported strong Q2 top-line growth, with revenue up 79% year over year to $294.4 million and gross written premium up 34% to $380.0 million, aided by customer growth, higher premium per customer, and a lower…
Read full summary
Lemonade reported strong Q2 top-line growth, with revenue up 79% year over year to $294.4 million and gross written premium up 34% to $380.0 million, aided by customer growth, higher premium per customer, and a lower reinsurance cession rate. Profitability improved in dollar terms—net loss was $43.4 million versus $43.9 million and adjusted EBITDA loss narrowed to $18.7 million—but GAAP gross margin slipped to 38% from 39% as retained losses and operating investment increased. The balance sheet remains liquid at $1.0628 billion in cash, cash equivalents, and investments, though operating cash flow was negative $4.0 million for the first half and GC financing borrowings were $206.4 million.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $-0.56
- Gross margin
- 38.0%
What stood out
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Revenue growth accelerated to $294.4M
Q2 revenue rose $130.3 million, or 79% year over year, to $294.4 million. It also increased about $36.4 million from the implied Q1 2026 level of $258.0 million ($552.4 million six-month revenue less $294.4 million in Q2).
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Customer and premium base expanded
Underlying customer metrics expanded: customers reached 3,308,666 versus 2,693,107 a year ago, in-force premium grew to $1.4343 billion from $1.0834 billion, and premium per customer increased to $433 from $402.
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Premium growth remained strong
Gross written premium increased $95.5 million, or 34%, to $380.0 million, driven by a 23% increase in customers and an 8% increase in premium per customer. Gross earned premium rose 32% to $332.4 million.
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Losses and adjusted EBITDA improved
Net loss narrowed modestly to $43.4 million from $43.9 million year over year, while adjusted EBITDA improved to a $18.7 million loss from a $40.9 million loss. For the first half, net loss improved $27.1 million, or 25%, to $79.2 million.
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Underwriting economics improved
Adjusted gross profit rose to $114.4 million from $65.6 million, and adjusted gross profit as a share of gross earned premium improved to 34% from 26%. The net loss ratio improved to 61% from 69%.
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Liquidity and growth-financing capacity
Liquidity remained substantial, with $367.6 million in cash and equivalents plus $695.2 million of investments, or $1.0628 billion combined. The company also signed a Hannover Re facility providing up to $250.0 million for growth financing during 2027-28.
What to watch
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Margin compression and cost growth
GAAP gross margin declined to 38% from 39% a year ago, despite revenue rising 79% to $294.4 million. Sales and marketing rose $18.1 million, or 30%, to $77.7 million, while general and administrative expense rose $22.0 million, or 85%, to $47.8 million.
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Negative operating cash flow and leverage
Cash flow from operations remained negative at $4.0 million used during the first six months of 2026. The company has generated negative operating cash flow since inception and funded growth partly through borrowings, which totaled $206.4 million under the GC agreement at June 30, 2026.
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More retained insurance risk
The renewed whole-account reinsurance program reduced the effective cession rate to 18% of premiums from approximately 20%, while the property-per-risk contract that previously covered claims above $750,000 up to $2.25 million was not renewed. Lower reinsurance can increase retained underwriting volatility.
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Claims-cost inflation and rate-lag risk
Management cites potential tariff-related increases in building-material, auto-parts and consumer-goods costs; rate increases may require regulatory approval and can lag claim-cost inflation. Net loss and LAE increased 99% to $154.0 million in Q2 as retained premium exposure expanded.
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No formal risk-factor updates
Risk factors were unchanged: Item 1A states there were no material changes from the annual 10-K risk factors. The filing nevertheless notes $352.4 million of the $810.5 million held by insurance entities is regulatory surplus, limiting unrestricted holding-company access.
Management's outlook
The 10-Q provides no quantitative revenue or EPS guidance. Management states that cash and equivalents of $367.6 million should meet working-capital, liquidity and capital-expenditure needs for at least the next 12 months, and that it has no current plans for material capital expenditures beyond operating requirements.
Earlier filings 4
10-K · February 25, 2026
Lemonade reports multi-quarter revenue acceleration and margin improvement as it scales its AI-driven platform: customers surpassed 3,000,000 and Q4 2025 revenue reached roughly $219M with operating margin improving to…
10-Q · November 5, 2025
Lemonade reported Q3 revenue of $194.5 million (up from $136.6 million a year ago) and a narrower GAAP loss per share of $(0.51) versus $(0.95) in Q3 2024. Revenue and certain top-line insurance metrics (net earned…
10-K · February 26, 2025
Lemonade positions itself as a technology-first, vertically integrated insurer that uses AI (AI Maya, AI Jim, CX.AI) and reinsurance plus a customer Giveback to reduce volatility and scale rapidly. The filing highlights…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.