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Dec 31, 2023
Lemonade Q4 2023 Earnings Report
Lemonade reported strong Q4 2023 results with significant year-over-year improvements in revenue, loss ratio, and profitability.
Key Takeaways
Lemonade's Q4 2023 showed strong growth and improved profitability. In-force premium grew by 20% year-over-year, while revenue increased by 31%. The gross loss ratio improved to 77%, and the company saw a 165% increase in gross profit. Adjusted EBITDA loss improved by 44%, and net loss improved by a third. The company expects accelerating top line growth and an improving bottom line in 2024.
In-force premium grew by 20% year-over-year, reaching $747 million.
Gross loss ratio improved by 12 points year-over-year, reaching 77%.
Gross profit increased by 165% year-over-year, with gross profit margin more than doubling to 29%.
Adjusted EBITDA loss improved by 44% year-over-year, and net loss improved by a third.
Forward Guidance
For Q1 2024, Lemonade anticipates in force premium of $789 - $791 million, gross earned premium of $183 - $185 million, revenue of $111 - $113 million, and an Adjusted EBITDA loss of ($43) - ($41) million. For the full year 2024, the company expects in force premium of $938 - $942 million, gross earned premium of $815 - $820 million, revenue of $505 - $510 million, and an Adjusted EBITDA loss of ($160) - ($155) million.
Positive Outlook
- in force premium at March 31, 2024 of $789 - $791 million (~21% growth YoY)
- Gross earned premium of $183 - $185 million (~20% growth YoY)
- Revenue of $111 - $113 million (~19% growth YoY)
- Adjusted EBITDA loss of ($43) - ($41) million (~19% improvement YoY)
- in force premium at December 31, 2024 of $938 - $942 million (~26% growth YoY)
Challenges Ahead
- Adjusted EBITDA loss of ($160) - ($155) million (~10% improvement YoY)
- Stock-based compensation expense of approximately $15 million (Q1 2024) and $60 million (FY 2024)
Historical Earnings Impact
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Avg. Return Before/After Earnings
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