Lemonade stock rose 3.4% following the company's Q4 2025 earnings announcement. The company reported its strongest quarter ever with in-force premium reaching $1.24 billion, up 31% year-over-year, and revenue increasing 53% to $228 million. Gross profit grew 73% to a record $111 million. The adjusted EBITDA loss narrowed to $5 million, and the company generated $37 million in positive adjusted free cash flow. Management reiterated targets for EBITDA profitability in Q4 2026 and full-year 2027. The company launched Lemonade Autonomous Car for Teslas with real-time pricing based on driving mode, pricing AI-driven miles at approximately 50% of human-driven miles. Management guided for roughly 60% full-year revenue growth in 2026 with positive adjusted EBITDA expected in Q4 2026.
Read full analysisLemonade stock rose 3.4% following the company's Q4 2025 earnings announcement. The company reported its strongest quarter ever with in-force premium reaching $1.24 billion, up 31% year-over-year, and revenue increasing 53% to $228 million. Gross profit grew 73% to a record $111 million. The adjusted EBITDA loss narrowed to $5 million, and the company generated $37 million in positive adjusted free cash flow. Management reiterated targets for EBITDA profitability in Q4 2026 and full-year 2027. The company launched Lemonade Autonomous Car for Teslas with real-time pricing based on driving mode, pricing AI-driven miles at approximately 50% of human-driven miles. Management guided for roughly 60% full-year revenue growth in 2026 with positive adjusted EBITDA expected in Q4 2026.
Lemonade is an AI-powered insurtech company offering renters, homeowners, pet, car, and life insurance through a digital-first platform, recently expanding into autonomous car insurance for Teslas with real-time pricing by driving mode. Despite narrowing its Q4 loss and growing revenue 53% year-over-year to $228.1 million, the company remains unprofitable with 2026 guidance projecting $48–$52 million in adjusted EBITDA losses even as management targets a positive EBITDA quarter by Q4 2026. The stock has fallen roughly 33% from its pre-market earnings-day high as the market prices in the gap between rapid growth and sustained profitability.