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Jun 30, 2022
Lemonade Q2 2022 Earnings Report
Lemonade had a strong second quarter, exceeding expectations on both top and bottom lines. The company closed the Metromile acquisition and is working to integrate the team and technology.
Key Takeaways
Lemonade reported a strong second quarter with both top and bottom lines coming in ahead of expectations. The company's In Force Premium increased by 54% to $457.6 million and revenue increased by 77% to $50.0 million. The company is expecting losses to peak in Q3 2022 and for EBITDA to improve thereafter, through to profitability.
Second quarter was strong: Both top and bottom lines came in ahead of expectations.
Cross-Sells trended up: 23% of sales in Q2 were from cross-sells and upsells.
Loss Ratio trended down: Gross loss ratio improved 10% in two quarters.
Peak losses are expected this quarter (Q3 22), and EBITDA is expected to improve thereafter, through to profitability.
Forward Guidance
The acquisition of Metromile closed on July 28, and thus Lemonade's guidance for the remainder of the year includes the financial impact of Metromile for approximately 2/3 of the third quarter, and a full quarter impact in the fourth quarter.
Positive Outlook
- In force premium at September 30 of $595 - $600 million
- Gross earned premium of $127 - $129 million
- Revenue of $63 - $65 million
- Stock-based compensation expense of approximately $16 million
- Capital expenditures of approximately $3 million
Challenges Ahead
- Adjusted EBITDA loss of ($74) - ($69) million
- In force premium at December 31 of $610 - $615 million
- Gross earned premium of $476 - $480 million
- Revenue of $236 - $239 million
Historical Earnings Impact
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Avg. Return Before/After Earnings
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