Lemonade (NYSE:LMND) Announces Earnings Results, Beats Expectations By $0.12 EPS

Lemonade (NYSE:LMND) posted its earnings results on Thursday. The company reported ($0.29) earnings per share (EPS) for the quarter, topping the consensus estimate of ($0.41) by $0.12, FiscalAI reports. The business had revenue of $228.10 million for the quarter, compared to analysts’ expectations of $218.07 million. Lemonade had a negative net margin of 26.39% and a negative return on equity of 31.86%. The business’s revenue for the quarter was up 53.3% compared to the same quarter last year. During the same period in the prior year, the company posted ($0.42) EPS.

Here are the key takeaways from Lemonade’s conference call:

• Company reported strong operating momentum with in‑force premium of $1.24 billion (+31% YoY), revenue +53%, gross profit +73% to $111 million, adjusted EBITDA loss narrowed to $5 million and adjusted free cash flow of $37 million, and management reiterated EBITDA profitability in Q4 2026 and full‑year 2027.
• Launched Lemonade Autonomous Car (initially for Teslas) using telematics that price by mode (park/human/AI); the company says Tesla FSD miles are >50% safer and are currently priced at about 50% of human‑driven miles, which could lower rates and customer acquisition costs over time.
• Growth spend ramped materially (Q4 growth spend $53 million, +48% YoY; plan for ~$225 million in growth spend for the year) while marketing efficiency stayed strong with an LTV:CAC above 3x, signaling management will continue to trade near‑term investment for faster top‑line expansion.
• Management is investing heavily in AI, a “pricing machine,” cross‑sell platform, and a local platform, arguing Lemonade’s decade of proprietary data and AI‑first culture provide a durable competitive edge versus legacy incumbents.
• Balance sheet and capital positioning appear supportive of growth with roughly $1.1 billion in cash and investments (about $250 million held as regulatory surplus) and a capital‑light reinsurance/captive structure that management says can support ambitious expansion.

Lemonade Stock Performance

Shares of Lemonade stock traded down $3.63 during midday trading on Thursday, hitting $62.10. The company had a trading volume of 4,474,559 shares, compared to its average volume of 2,550,972. The company has a 50 day moving average of $78.31 and a 200 day moving average of $66.11. Lemonade has a 52-week low of $24.31 and a 52-week high of $99.90. The stock has a market capitalization of $4.64 billion, a P/E ratio of -25.87 and a beta of 2.03.

Key Stories Impacting Lemonade

Here are the key news stories impacting Lemonade this week:

• Positive Sentiment: Q4 beat on both EPS and revenue: Lemonade reported a narrower loss (‑$0.29 vs. consensus ‑$0.41) and revenue of $228.1M (well above estimates), showing 53% YoY revenue growth — a key catalyst for the rally. Lemonade (LMND) Q4 Earnings: Taking a Look at Key Metrics Versus Estimates
• Positive Sentiment: Raised FY2026 and Q1 revenue guidance came in above Street consensus (FY revenue guide ~ $1.2B), and management now forecasts adjusted EBITDA turning positive by year‑end — a material forward-profitability signal. Lemonade Announces Fourth Quarter and Full Year 2025 Financial Results
• Positive Sentiment: Operational improvements: gross margin expansion, +37% FCF to ~$37M, growing gross earned premium and in‑force premium — evidence the business model is starting to convert growth into cash. Lemonade’s Sweet Results Refresh Market Appetite: Rebound Ahead
• Positive Sentiment: High short interest amplified moves: heavy short positioning contributed to a sharp pre‑market jump as shorts faced cover risk. That dynamics can produce outsized intraday moves. Highly Shorted Stock Lemonade Jumps On Strong Quarter
• Neutral Sentiment: Company posted shareholder letter and hosted the earnings call (management color and guidance detail available on the webcast). Use the call transcript to judge cadence and forward assumptions. Lemonade Announces Fourth Quarter and Full Year 2025 Financial Results
• Neutral Sentiment: Coverage and headlines are broadly positive but analyst revisions were limited immediately; MarketBeat and other outlets highlight a longer runway but mixed near‑term technicals. Lemonade’s Sweet Results Refresh Market Appetite: Rebound Ahead
• Negative Sentiment: Underwriting cleanup trimmed ADR (retained premium) as management non‑renewed some policies to improve portfolio quality — a near‑term headwind to premium retention. Lemonade’s Sweet Results Refresh Market Appetite: Rebound Ahead
• Negative Sentiment: Company remains unprofitable on GAAP metrics (negative net margin and ROE); consensus still models multi‑year path to sustained profit — a risk if growth or loss‑ratio improvements slow. Lemonade (LMND) Reports Q4 Loss, Tops Revenue Estimates
• Negative Sentiment: High institutional ownership plus elevated short interest increase the potential for volatile swings and quick reversals; position sizing and stop discipline are advised. Lemonade’s Sweet Results Refresh Market Appetite: Rebound Ahead

Insider Activity

In related news, CEO Daniel A. Schreiber sold 9,108 shares of the firm’s stock in a transaction that occurred on Friday, January 23rd. The shares were sold at an average price of $99.04, for a total transaction of $902,056.32. Following the completion of the sale, the chief executive officer owned 1,514,426 shares of the company’s stock, valued at $149,988,751.04. This trade represents a 0.60% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is available at the SEC website. Also, Director Debra Schwartz sold 4,200 shares of Lemonade stock in a transaction on Thursday, December 11th. The stock was sold at an average price of $83.59, for a total value of $351,078.00. Following the completion of the sale, the director directly owned 21,567 shares of the company’s stock, valued at approximately $1,802,785.53. The trade was a 16.30% decrease in their position. The disclosure for this sale is available in the SEC filing. Over the last 90 days, insiders sold 250,540 shares of company stock valued at $22,007,574. Company insiders own 14.70% of the company’s stock.

Hedge Funds Weigh In On Lemonade

A number of hedge funds have recently made changes to their positions in LMND. Caitong International Asset Management Co. Ltd lifted its stake in Lemonade by 8,080.0% in the 4th quarter. Caitong International Asset Management Co. Ltd now owns 409 shares of the company’s stock worth $29,000 after purchasing an additional 404 shares in the last quarter. Northwestern Mutual Wealth Management Co. purchased a new position in Lemonade during the 4th quarter valued at approximately $33,000. NewEdge Advisors LLC purchased a new stake in shares of Lemonade during the 1st quarter worth approximately $35,000. Strive Financial Group LLC bought a new stake in Lemonade in the fourth quarter worth $38,000. Finally, Macquarie Group Ltd. purchased a new stake in Lemonade during the fourth quarter valued at $63,000. Institutional investors own 80.30% of the company’s stock.

Wall Street Analysts Forecast Growth

A number of equities research analysts recently issued reports on LMND shares. Weiss Ratings reiterated a “sell (d-)” rating on shares of Lemonade in a research report on Thursday, January 22nd. Cantor Fitzgerald raised their price target on Lemonade from $85.00 to $92.00 and gave the company an “overweight” rating in a report on Wednesday, January 14th. Truist Financial assumed coverage on Lemonade in a research report on Tuesday, January 6th. They set a “buy” rating and a $98.00 price target for the company. Keefe, Bruyette & Woods upped their price objective on shares of Lemonade from $35.00 to $40.00 and gave the stock an “underperform” rating in a research report on Tuesday, November 25th. Finally, Citigroup reiterated an “outperform” rating on shares of Lemonade in a research report on Friday, January 16th. Four research analysts have rated the stock with a Buy rating, two have assigned a Hold rating and three have issued a Sell rating to the stock. Based on data from MarketBeat, Lemonade presently has a consensus rating of “Hold” and a consensus price target of $70.29.

Lemonade Company Profile

Lemonade, Inc (NYSE: LMND) is a New York–based technology-driven insurance carrier that leverages artificial intelligence and behavioral economics to streamline the purchase and management of policies. Founded in 2015, the company offers renters, homeowners, pet, term life and car insurance products tailored for digitally savvy consumers. By automating underwriting and claims processing through chatbots and machine learning, Lemonade aims to deliver a more transparent and user-friendly experience than traditional insurers.

The company’s product suite includes standalone policies for renters and homeowners, customizable pet insurance plans, and term life coverage with simple online applications.