Lemonade's Q1 Earnings: Accelerating Growth, Strong Underwriting Performance
New York, NY - April 29, 2026 - Lemonade, the digital insurance company, has reported another exceptional quarter with strong growth, excellent underwriting performance, and increasing operating leverage. The company's CEO, Daniel Schreiber, and President, Shai Wininger, joined a question-and-answer session following today's prepared remarks to discuss these results.
According to Lemonade's latest Q1 2026 earnings report, the company has continued its streak of accelerating growth, reaching $1.33 billion in-force premium (IFP), up by 32% year-over-year. This marks the tenth consecutive quarter of increasing growth for Lemonade.
One key driver behind this growth is Lemonade's strength in marketing efficiency. The company's proprietary LTV AI dynamically allocates capital to maximize returns, allowing it to grow its spend by roughly 200% since Q1 2023 while maintaining an average customer acquisition cost (CA) ratio of above three. This is a remarkable achievement, as conventional wisdom suggests that increased growth spend comes at the expense of efficiency.
In addition to its strong marketing performance, Lemonade has also seen significant benefits from bundling activity, which boosts customer lifetime value and enables the company to scale its growth investments while preserving unit economics. As a result, Lemonade is able to deliver improved profitability alongside accelerating growth.
Lemonade's underwriting performance continues to be very strong, with gross profit growing 159% year-over-year. The company's adjusted EBITDA loss narrowed by 64%, reflecting continued progress towards profitability. With solid cash flow from operations generating $17 million in adjusted free cash flow - a $48 million improvement year-over-year - Lemonade is well-positioned for future growth.
The company reiterates its expectation that Q4 this year will be EBITDA positive, as will the full year of 2027. In fact, Lemonade has raised its full-year guidance for both top and bottom lines, indicating confidence in its ability to deliver increased growth and profitability throughout 2026 and beyond.
As Daniel Schreiber noted during his prepared remarks, 'The impact of 10 years of investment in AI infused into our single proprietary and vertically integrated system is now visible throughout our business and on pretty much every line of our PNL.' This strategic focus has enabled Lemonade to scale efficiently, with the company surpassing $1 million of IFP per employee - a nearly three times improvement over the past four years.
Overall, Lemonade's Q1 earnings demonstrate the company's continued momentum in growth and profitability. With its strong underwriting performance, marketing efficiency, and operating leverage, Lemonade is well-positioned to drive further success in 2026 and beyond.
