Lemonade Beats Q3 Revenue Expectations With $336 Million And Raises Outlook
Digital insurer Lemonade beat third-quarter expectations with $336 million in revenue, a 72.8% surge. The company raised its annual outlook and projects its first positive EBITDA next quarter.
Lemonade, the digital insurance company, surpassed analysts' expectations and its own revenue guidance in its third-quarter financial report, posting quarterly revenue of $336 million, a 72.8% increase compared to the same quarter last year. On the bottom line, Lemonade also outperformed market consensus, reporting a net loss of 56 cents per share, which is 2 cents lower than the analysts' projected loss.
Founded by CEO Daniel Schreiber and President Shai Wininger, Lemonade is revising its annual revenue forecast upward. The company now expects to close the year with revenues between $1.231 billion and $1.235 billion, up from its previous projection of $1.214 billion to $1.22 billion. There is no change to the adjusted EBITDA forecast, which is expected to remain negative at $51 million to $47 million for the year. However, aligning with its previously stated targets, the fourth quarter will mark Lemonade's first-ever transition to positive adjusted EBITDA, with the company projecting between $5 million and $9 million, compared to a negative EBITDA of $20.4 million in the third quarter.
During the first three quarters of the year, Lemonade's total revenues reached $889 million, marking a 74.3% growth year-over-year. The net loss for this period narrowed by 14.5% to $123 million, while adjusted EBITDA stood at a negative $56.2 million. Since the beginning of the year, the company generated a positive cash flow of $3.3 million from operating activities, contrasting with a negative cash flow of $37.2 million in the corresponding period last year. By the end of the third quarter, Lemonade served over 3.5 million customers.
Lemonade is scheduled to host an investor day in New York on November 17, where management is expected to outline the company's long-term strategy, anticipated growth trajectory, and artificial intelligence capabilities.
Lemonade is traded on the New York Stock Exchange with a market capitalization of $3.55 billion. The company's stock has recently rebounded from an annual low reached earlier, and shares climbed in pre-market trading following the release of the earnings report.
