Lemonade presented strong reports, but the stock moved lower

Company Lemonade The Israeli company of Daniel Schreiber (CEO) and Shay Wininger (President) reported strong results for it with revenues of $228.1 million, a jump of 53% compared to the corresponding quarter last year and above analysts’ expectations for revenues of $218.1 million. At the beginning of trading, the stock jumped by more than 13%, but now it has weakened and moved to declines of about 4%.

At the same time, the company also records an improvement in the important ratio in insurance companies of a drop to 52% in the ratio of payment between claims and revenue (Loss Ratio). The lower this number, the more the company earns (or in the case of Lemonade, loses less). The number of active customers of the company also increased in the last year to almost 3 million, an increase of 23% in the last year.

But more than these results, investors in the market especially like the company’s forecasts going forward. Lemonade expects revenues of 246-251 million dollars in the coming quarter and revenues of 1.189-1.194 billion dollars for the entire year. In both cases, this is a better forecast than the analysts’ expectations – they expected revenues of $241.6 million in the first quarter of this year and $1.16 billion in revenues in 2026 as a whole. The company also predicts that it will end the entire year with an adjusted EBITDA loss (profit excluding interest, tax, depreciation and amortization) of 48-52 million dollars, half of which will already be in the first quarter of the year.

The company continues to expect a positive EBITDA transition

And yet, the company is still losing money. Lemonade records a negative adjusted EBITDA of $4.6 million in the fourth quarter of this year, an improvement over a loss of nearly $24 million in the corresponding quarter last year. However, Belmonide is careful to point out that the company will pass in the fourth quarter of this year, 2026, to a profit in this line, for the first time in its history. and that a transition to full profitability will occur in 2027.

“Today we are reporting the strongest quarter in Lemonade’s history and marking the ninth quarter in a row of accelerating growth, while improving the key indicators,” says Shay Wininger, co-founder and president of Lemonade. “The fact that Lamoneid was built on an artificial intelligence infrastructure from day one, years before ChatGPT and the revolution we are all experiencing today, allows us to achieve unprecedented results in insurance: hyper-growth alongside consistent and continuous improvement in the bottom line.

“We are starting 2026 with stronger momentum than ever: we expect a 60% growth in revenues this year and a transition to profitability in the fourth quarter. The company relies on ever-increasing cash balances, with over $1.1 billion in the bank, and continues to expand rapidly in the various products as well as its unique car insurance in the US.”

Lemonade, as you remember, was issued in New York in 2020 at a value of 1.6 billion dollars. During the peak of the technology bubble Lemonade rose to a value of 10 billion dollars, but like many companies has since lost a significant part of its value. It now trades at a value of $4.9 billion.