Q1 2026 Lemonade Inc Earnings Call Transcript
Key Points
- Lemonade Inc (LMND) reported a 32% year-over-year growth in in-force premium, reaching $1.33 billion.
- Revenue increased by 71%, driven by a reinsurance transition and higher premium retention.
- Gross profit grew by 159%, reflecting strong underwriting performance and growth acceleration.
- The company generated $17 million in adjusted free cash flow, marking a $48 million improvement year-over-year.
- Lemonade Inc (LMND) expects to achieve EBITDA profitability by Q4 2026 and for the full year of 2027.
- Annual dollar retention (ADR) has been stable, with no significant improvement due to targeted non-renewal initiatives.
- Operating expenses increased by 25% year-over-year, driven by higher sales and marketing expenses.
- The adjusted EBITDA loss, although improved, still stands at $17 million for Q1 2026.
- Stock-based compensation expenses are expected to be higher than previous guidance, primarily due to multiyear equity grants.
- The gross combined ratio remains high at 138%, indicating room for improvement compared to industry averages.
Hello, everyone. Thank you for joining us and welcome to Lemonade's Q1 2026 earnings call.
(Operator Instructions)
I will now hand the conference over to Lemonade to begin the call. Please go ahead.
Good morning, and welcome to Lemonade's first-quarter 2026 earnings call. Joining us on our call today, we have Daniel Schreiber, CEO and Co-Founder; Shai Wininger, President and Co-Founder; Tim Bitsy, Chief Financial Officer; and Nick Stead, SVP Finance.
A letter to shareholders covering the company's first-quarter 2026 financial results is available on our Investor Relations website at lemonade.com/investor. I would like to remind you that management's remarks made on this call may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.
Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors, including those discussed in the Risk Factors section of our most recent Form
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