Lemonade (LMND) investor relations material

Executive summary

• Achieved 32% year-over-year in-force premium growth to $1.33 billion, marking 10 consecutive quarters of accelerating growth and surpassing $1.3B by Q1 2026.

• Revenue for Q1 2026 was $258.0 million, up 71% year-over-year, driven by strong customer growth and higher premium retention.

• Gross profit rose 159% to $100 million, with gross profit margin expanding to 39% and adjusted EBITDA loss narrowing 64% year-over-year.

• Net loss improved to $35.8 million ($0.47/share) from $62.4 million ($0.86/share) year-over-year, reflecting improved operating leverage and reduced loss ratios.

• Pet insurance became the largest business line, surpassing $500 million in in-force premium and achieving strong market share among younger customers.

Financial highlights

• Added 158,000 new customers in Q1, a 37% increase from the prior year, with total customer count rising 23% to over 3.1 million.

• Gross loss ratio improved to 62% from 78%, with a 3% favorable prior period development and 5% CAT impact.

• Adjusted gross profit margin reached 39%, and adjusted gross profit as a percentage of gross earned premium was 33%, up 13 points year-over-year.

• Ended the quarter with $1.1 billion in cash and investments, including $374.3 million in cash and $669.4 million in investments.

• In-force premium per employee tripled over four years, reflecting strong operating leverage.

Outlook and guidance

• Raised full-year 2026 guidance for both top and bottom lines, with Q2 guidance implying 32% top-line growth and full-year guidance implying 33% top-line and 63% revenue growth.

• Expects positive EBITDA for Q4 2026 and full-year 2027.

• Projected $235 million in growth spend for 2026.

• Management expects continued growth in customers and premium per customer, with ongoing investment in technology and marketing.

• Existing cash and investments are expected to be sufficient to meet working capital and capital expenditure needs for at least the next 12 months.