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Lemonade points to AI-led underwriting growth as shares drop after results
Lemonade reported second-quarter revenue growth of 79% and an increase in in-force premium, but the stock fell about 20% because investors sought higher guidance.
Lemonade, Inc. reported strong second-quarter results as it uses AI to underwrite insurance in seconds instead of weeks, according to MarketBeat Ratings. The company said revenue rose 79% to $294.4 million, while in-force premium climbed 32.5% to $1.43 billion, marking an 11th straight quarter of accelerating growth.
The results also showed gross profit growing roughly tenfold over several years while headcount has barely moved, a sign the company says AI has absorbed much of the workload. Adjusted EBITDA losses narrowed to $19 million from $41 million a year earlier, and Lemonade reiterated its expectation to reach positive adjusted EBITDA by Q4 2026.
Even with the operating progress, the stock fell roughly 20% after the report. MarketBeat Ratings attributed the decline to Wall Street wanting a guidance increase rather than a repeat of solid execution, and it also noted a newly announced CFO transition added some uncertainty.