Solid Growth in Tough Quarter

• Lemon juice won the analysts ’estimates, produced strong revenues, premium, and customer growth.

• The company’s profits were affected by the California fires, as expected.

• Lemonade continues to make progress towards its financial goals and deals with the natural catastrophe well, but it is still far from profitability.

Here is our initial taking lemonade‘s (NYSE: LMND) Fiscal Year 2025 Financial Report in the first quarter.

Lemonade lost less money than expected in the first quarter, overcoming Wall Street’s expectations for both revenues and arrow profits. The company continues to spend significantly on growth, but this spending pays its fruits, as the force installments in power top the amount of $ 1 billion and an increase of 26 % on an annual basis.

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The number of Lemonade customers increased by 21 % to 2.5 million, and the company shows signs of customer relationship growth over time. A premium for each customer increased by 4 % to $ 396.

Of course, lemonade has a long history of the ability to attract customers. The question for investors is the quality of the company that the company puts in insurance business. We also see progress here: Lemonade’s overall loss – a measure of the remaining insurance premiums after paying the claims – was improved by 100 basis points to 78 %.

This is higher than the long -term goal of the company, which is 75 % (low numbers is better), but the number in the first quarter includes great success from 16 points due to California fires. Insurance is volatile by nature, and the results decrease after large disasters lead to batches. Lemonade’s strong performance is relatively strong during what should have been a difficult period for insurance companies a reason for optimism.

In general, the 12 -month -long LEMONADE loss remained fixed from the previous quarter, by 73 %.

Lemon juice also continues to invest in future growth. Growth spending, including sales and marketing expenses, doubled to $ 38.1 million per quarter.

Lemon juice shares have decreased by 18 % so far, heading to profits, but investors loved the results they saw. Lemonade shares increased by 8 % in pre -market trading.

Lemon juice is a continuous work. The results move in the right direction, but the company still has a way to become a ripe and profitable insurance company. The free cash flow and the cash flow of operations were negative in the quarter.