Short answer
Lemonade, Inc. (LMND) filed its fiscal 2025 10-K annual report with the SEC on Feb 25, 2026. It reported revenue of $738M (+40.2% year over year) and net income of −$166M.
- Top risk flagged: Regulatory risk: Compliance with EU Artificial Intelligence Act effective August 2026, imposing extensive obligations and fines up to 7% global turnover
FY2025 key financial metrics · XBRL
- Revenue
- $738M
- +40.2% YoY
- Net income
- −$166M
- +18.2% YoY
- EPS (diluted)
- −$2.24
- +21.4% YoY
- ROE
- -31.0%
- +3.1 pp YoY
- Operating cash flow
- −$17M
- −44.7% YoY
Source: XBRL data from the Lemonade, Inc. (LMND) FY2025 10-K on SEC EDGAR. USD.
Lemonade, Inc. FY2025 10-K analysis
AI summary of each section, grounded in the filing text
Business Overview
- Core business model: vertically-integrated, AI-powered digital insurance platform offering renters, homeowners, pet, car, and life insurance with high automation and customer alignment
- New emphasis on specialized car insurance pricing using direct vehicle telemetry to differentiate autonomous miles at significant discount
- Strategic refinement of reinsurance portfolio to balance capital efficiency (55% reinsured through mid-2025) with stable, growing gross margin
- Pet insurance claims efficiency improved 78% with cost per claim dropping from $65 to $14; pet insurance book grew over 35x in incidents filed
- Over 3 million customers served with platform operating in 41 US states plus multiple European countries, leveraging AI bots for 96% automated first-loss claim notices
Management Discussion & Analysis
- Revenue $737.9M in 2025 vs $526.5M in 2024, up $211.4M or 40.2% YoY
- Gross profit margin 40% in 2025 vs 32% in 2024; adjusted gross profit margin 41% vs 33%
- Best performing segment: growth in customers to 2,984,513 from 2,430,056 (+554,457)
- Worst performing metric: net loss $165.5M in 2025 vs $202.2M in 2024 (smaller loss but still negative)
- Cash: $158.1M outstanding borrowings under Customer Investment Agreement; interest expense $17.3M; plan to invest heavily in sales and marketing growth, no capex or dividends disclosed
- Outlook/risk: macroeconomic uncertainty including tariffs, inflation, geopolitical risks in Israel, and reinsurance availability could impact costs, loss ratios and returns
Risk Factors
- Regulatory risk: Compliance with EU Artificial Intelligence Act effective August 2026, imposing extensive obligations and fines up to 7% global turnover
- Macroeconomic threat: California Proposition 103 restricts telematics use in largest car insurance market, limiting risk assessment and underwriting accuracy
- Operational vulnerability: Dependence on third-party providers for life insurance product; loss or unfavorable contract renewal could disrupt operations and finances
- Competitive threat: Intense competition from incumbents Progressive, GEICO, and tech entrants adopting AI threatens market share and profitability
- Financial risk: Accumulated deficit $1,464.3M as of Dec 31, 2025; net loss $165.5M in 2025 with ongoing significant investments and profitability uncertain
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