Lemonade (NYSE:LMND) Issues Earnings Results

Lemonade (NYSE:LMND) released its quarterly earnings data on Thursday. The company reported ($0.56) earnings per share for the quarter, beating the consensus estimate of ($0.58) by $0.02, Zacks reports. Lemonade had a negative return on equity of 26.78% and a negative net margin of 14.19%. The company had revenue of $336.10 million for the quarter, compared to analyst estimates of $322.74 million. During the same period in the prior year, the company posted ($0.51) EPS. The company’s revenue was up 72.8% compared to the same quarter last year.

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

• Growth accelerated: In Force Premium rose 34% to $1.55 billion, revenue grew 73% to $336 million, and gross profit reached a record $118 million. Management expects positive Adjusted EBITDA in Q4 2026 and reiterated its goal of full-year profitability in 2027.
• Car and geographic expansion are gaining momentum: Lemonade Car In Force Premium grew 63% year over year and is now available in 14 states; the company also made Renters available nationwide. Management said Car underwriting trends are healthy, while noting growth is not constrained by geographic reach.
• Cross-sales are becoming a larger growth driver: Year-to-date cross-sales exceeded $100 million and are growing at about twice the overall In Force Premium rate, with bundled premium nearing 20% of the total. Management said these sales benefit from both deeper penetration of existing customers and new product launches.
• Claims-cost pressure is weighing on results: Higher veterinary costs are pressuring Pet loss ratios and were the main reason full-year revenue guidance increased while Adjusted EBITDA guidance remained unchanged. Management expects rate increases to help moderate Pet losses over coming quarters; elevated catastrophe and large losses also lifted Europe’s quarterly loss ratio.
• Personal AI agents are a longer-term opportunity, not yet a volume driver: Management said it is not seeing meaningful business volume from personal agents yet, but plans to enable them to interact with Lemonade OS and believes its integrated, AI-native platform could provide an advantage.

Lemonade Stock Performance

Lemonade stock traded down $1.89 during trading hours on Friday, hitting $39.59. 1,683,682 shares of the stock were exchanged, compared to its average volume of 1,111,121. The stock has a market capitalization of $3.06 billion, a P/E ratio of -21.06 and a beta of 1.98. The business’s 50-day moving average is $46.66 and its two-hundred day moving average is $57.69. Lemonade has a 12 month low of $39.11 and a 12 month high of $99.90.

Analyst Upgrades and Downgrades

Several equities analysts recently commented on LMND shares. Truist Financial cut their target price on Lemonade from $70.00 to $60.00 and set a “buy” rating for the company in a research report on Friday. Weiss Ratings reiterated a “sell (d-)” rating on shares of Lemonade in a research report on Thursday, October 15th. Morgan Stanley dropped their price objective on Lemonade from $56.00 to $48.00 and set an “equal weight” rating for the company in a research note on Tuesday, October 6th. Wall Street Zen cut Lemonade from a “hold” rating to a “sell” rating in a report on Saturday. Finally, Citizens Jmp cut their price objective on Lemonade from $80.00 to $75.00 and set a “market outperform” rating for the company in a report on Friday. Four equities research analysts have rated the stock with a Buy rating, four have assigned a Hold rating and one has assigned a Sell rating to the stock. According to MarketBeat.com, the stock presently has an average rating of “Hold” and a consensus target price of $61.12.

Insider Buying and Selling

In related news, insider Maya Prosor sold 1,040 shares of the stock in a transaction that occurred on Thursday, September 3rd. The stock was sold at an average price of $54.63, for a total transaction of $56,815.20. Following the sale, the insider directly owned 186,533 shares in the company, valued at $10,190,297.79. This represents a 0.55% decrease in their position. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available at the SEC website. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, insider John Peters sold 11,000 shares of the firm’s stock in a transaction on Thursday, August 13th. The shares were sold at an average price of $52.55, for a total value of $578,050.00. Following the sale, the insider directly owned 76,942 shares of the company’s stock, valued at $4,043,302.10. This represents a 12.51% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Insiders sold 15,148 shares of company stock valued at $804,250 in the last quarter. 12.20% of the stock is currently owned by corporate insiders.

Trending Headlines about Lemonade

Here are the key news stories impacting Lemonade this week:

• Positive Sentiment: Q3 revenue rose 72.8% year over year to $336.1 million, above the $322.7 million consensus estimate. The $0.56-per-share loss was slightly narrower than analysts expected, and Q4 revenue guidance of $342 million to $346 million edged above estimates. Lemonade Q3 results
• Neutral Sentiment: Truist cut its price target to $60 from $70 but kept a Buy rating; Citizens JMP lowered its target to $75 from $80 and maintained Market Outperform. Piper Sandler reduced its target to $47 from $51 and retained a Neutral rating. The target cuts temper the analyst outlook, while the ratings remain mixed but generally supportive. Truist rating
• Negative Sentiment: The loss widened from $0.51 per share a year earlier, and coverage flagged rising expenses as a potential headwind to Lemonade’s AI-driven growth. The post-earnings decline suggests investors focused on profitability concerns despite the revenue and EPS beats. Q3 expense headwinds analysis

Lemonade Company Profile

Lemonade, Inc is a technology-driven insurance company that offers insurance products through digital platforms, including its mobile application and website. The company uses artificial intelligence, automation and data analytics to support policy purchasing, customer service and claims processing.

Lemonade’s product offerings include renters, homeowners, car, pet and term life insurance. Coverage and product availability vary by jurisdiction, and some policies are provided through regulated insurance subsidiaries or underwritten in partnership with other insurers.

Founded in 2015 by Daniel Schreiber and Shai Wininger, Lemonade serves customers in the United States and selected European markets, including Germany, the Netherlands, France and the United Kingdom.