Lemonade lowers net loss in 2023 financials

Plan for 2024 outlined

Lemonade lowers net loss in 2023 financials

Insurance News

By Terry Gangcuangco

Lemonade has trimmed its losses in 2023.

Here’s how the insurance company fared in the quarter and year ended December 31:


Q4 2023

Q4 2022

FY 2023

FY 2022

Total revenue

US$115.5 million

US$88.4 million

US$429.8 million

US$256.7 million

Gross profit

US$33.6 million

US$12.7 million

US$84.1 million

US$42.3 million

Adjusted gross profit

US$35.3 million

US$17.9 million

US$97.4 million

US$64.9 million

Net loss

US$42.4 million

US$63.7 million

US$236.9 million

US$297.8 million

Adjusted EBITDA

US$(28.9 million)

US$(51.7 million)

US$(172.6 million)

US$(225.1 million)


In its letter to shareholders, Lemonade said: “Turning to 2024, there’s reason to be hopeful that many of the industry’s headwinds of ‘22-‘23 may turn into tailwinds in ‘24-‘25: inflation seems to be receding, new rate approvals are adding up and earning in, and if the costs of capital come down, we may yet see a moderation in reinsurance costs too.

“Even if all these wishes come true, however, within the four walls of Lemonade we will have our work cut out for us. As the universe of products and geographies where we are rate-adequate expands, we intend to grow in lockstep. Ours, after all, is a business that grows in profitability as it grows in scale – and so grow we must.

“That’s why we plan to roughly double our growth budget in 2024, from the US$55m spent in 2023. Doubling spend won’t double our growth rate, since (i) the number of customers we acquire organically won’t be impacted much, and (ii) our denominator has swelled – but in dollar terms we expect to add about 50% more IFP (in force premium) in 2024 than we did in 2023.

“The upshot is that we are on a trajectory of steadily gaining velocity, as we smoothly accelerate our growth rate back to our target baseline of 25% CAGR, and beyond.

“The associated spend, and the resultant growth, should boost our bottom line a couple of years hence, but it will weigh on our bottom line in the coming quarters. Threading that needle – doubling growth spend while shrinking Adjusted EBITDA losses – will be our central challenge in 2024.”

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