Financial Data and Key Metrics - Revenue increased by 17% YoY to $122 million in Q2 2024, driven by a 22% increase in gross earned premium, higher ceding commission rates, and a 45% increase in investment income [11] - Gross loss ratio improved to 79% in Q2 2024, down from 94% in Q2 2023, with CAT losses contributing 17 percentage points to the gross loss ratio [11] - Adjusted EBITDA loss improved by 18% YoY to $43 million in Q2 2024 [15] - In-force premium (IFP) grew 22% YoY to $839 million, while customer count increased by 14% to 2.2 million [10] - Premium per customer increased by 8% YoY to $387, driven primarily by rate increases [10] Business Line Performance - Gross loss ratio improved across all product lines, with YoY improvements ranging from 5% to 30% [12] - Homeowners insurance, particularly CAT-exposed policies, remains the most challenging segment, with the company planning to non-renew $20-25 million of IFP in the second half of 2024 to reduce CAT volatility [16][17] - The company's pet insurance product showed favorable development, contributing to the 5% favorable non-CAT prior period development [59] Market Performance - The company expanded its homeowners insurance into the UK and France, contributing to geographic diversification and reduced CAT exposure [5] - In Illinois, where all five insurance products are available, multiline customer rates are roughly double the rest of the book, with superior retention rates and high customer satisfaction [19] Strategic Direction and Industry Competition - The company is focused on reducing CAT volatility by growing products with lower CAT exposure, such as pet and renters insurance, and diversifying geographically [5] - The next-generation technology platform, codenamed L2, is expected to bring significant efficiency gains and accelerate product operations, positioning the company to adapt quickly to market changes [9] - The company aims to achieve best-in-class expense ratios, with a long-term target in the teens, driven by technology-first operational efficiencies [51][52] Management Commentary on Operating Environment and Future Outlook - Management highlighted the company's progress in reducing CAT volatility and improving loss ratios, with a trailing 12-month gross loss ratio of 79% [6] - The company expects to maintain positive cash flow consistently, except for Q4 2024, due to timing issues [6] - Management is optimistic about the auto insurance segment, citing strong customer satisfaction and the potential for cross-selling to existing renters and homeowners customers [30][31] Other Important Information - The company contributed over $2 million to 43 nonprofits globally as part of its giveback program, bringing total contributions since inception to over $10 million [7] - The company plans to hold an Investor Day on November 19, 2024, in New York City, where it will provide updates on strategic expansion plans and growth trajectory [4] Q&A Session Summary Question: Details on non-renewals of CAT-exposed home business - The non-renewals are focused on older policies written 2-4 years ago, primarily in states with higher-than-target loss ratios, and are expected to generate $50-60 million in net positive value despite a short-term impact on IFP growth [22][23] Question: Capital surplus and investment income trends - The company maintains a target premium-to-surplus ratio of 1:6 and expects cash and investment balances to remain above $900 million, with strong returns on cash investments [25][26] Question: Auto insurance expansion and margin expectations - The company plans to expand auto insurance to additional states in 2025, focusing on profitability and regulatory approval, with expectations of muted margin pressure due to cross-selling opportunities with existing customers [29][30] Question: Impact of non-renewals on loss ratio and CAT losses - The non-renewals are expected to improve the loss ratio and reduce CAT volatility, particularly in the homeowners segment, which is the most CAT-exposed part of the business [43] Question: Ceding commission trends - The ceding commission rate was 18% in Q2 2024, slightly lower than the prior year's 20%, due to a shift from a fixed to a variable structure, with expectations of some volatility quarter-to-quarter [44] Question: Premium per customer growth and rate increases - The company is approximately halfway through its rate increases, with $100 million remaining to be earned in, and expects to continue earning at a similar pace into next year [48] Question: Long-term expense ratio target - The company aims for an expense ratio in the teens at scale, driven by technology efficiencies and operational excellence, with the potential to pass some savings on to customers [51][52] Question: LTV to CAC and growth strategy - The company maintains an LTV to CAC ratio of approximately 3:1, with expectations of continued profitable growth and a focus on acquiring marginally profitable customers [60][63]

The reported revenue represents a surprise of -0.37% over the Zacks Consensus Estimate of $122.46 million. With the consensus EPS estimate being -$0.85, the EPS surprise was +4.71%. Since these metrics play a crucial role in driving the top- and bottom-line numbers, comparing them with the year-ago numbers and what analysts estimated about them helps investors better project a stock's price performance. In force premium (end of period) Customers (end of period) : 79% compared to the 83.8% average estimate b ...

This insurance and reinsurance company is expected to post quarterly earnings of $0.69 per share in its upcoming report, which represents a year-over-year change of -10.4%. The consensus EPS estimate for the quarter has been revised 8.4% lower over the last 30 days to the current level. Fidelis Insurance Holdings' revenues are expected to be $582.19 million, up 28.5% from the year-ago quarter. One other stock from the same industry, Fidelis Insurance Holdings (FIHL) , is yet to report results for the quarte ...

[Q2 2024 Shareholder Letter Highlights](index=2&type=section&id=Q2%202024%20Shareholder%20Letter%20Highlights) This section highlights Lemonade's strong Q2 2024 performance, driven by robust growth, positive net cash flow, improved loss ratios, and impressive operating leverage [Executive Summary](index=2&type=section&id=Executive%20Summary) Lemonade reported excellent second-quarter results, characterized by strong topline growth, stable expenses, and positive net cash flow (NCF) - Q2 2024 results were excellent, driven by robust topline growth, stable expenses, and **positive net cash flow (NCF)**[61](index=61&type=chunk) | Metric | Q2 2024 Value | YoY Change | | :-------------------------- | :------------ | :--------- | | In Force Premium (IFP) | $839 million | ↑ 22% | | Revenue | $122.0 million| ↑ 17% | | Gross Loss Ratio | 79% | ↓ 15% | | Gross Profit | $30.8 million | ↑ 155% | | Gross Profit Margin | 25% | Doubled | | Adjusted EBITDA Loss | ($43) million | Improved 18% | | Net Loss | ($57) million | Improved 15% | | Total Customers | 2,167,194 | ↑ 14% | | Premium per Customer | $387 | ↑ 8% | [Cash Flow Positive & Strategy](index=3&type=section&id=Cash%20Flow%20Positive%20%26%20Strategy) Lemonade achieved positive Net Cash Flow (NCF) in Q2 2024 and expects to remain NCF positive, with the exception of Q4 2024 due to seasonal patterns - Lemonade was **Net Cash Flow (NCF) positive in Q2 2024** and anticipates remaining NCF positive, except for Q4 2024 due to seasonal patterns[44](index=44&type=chunk)[48](index=48&type=chunk) - Cash flow is considered a leading indicator in the insurance industry, providing a more current picture of the business model's benefits and capturing the layered impact of growth spend, where **80% is financed by synthetic agents**[65](index=65&type=chunk) - The company's cash and investments balance is expected to dip by **1-2%** from its current **$931 million** before consistently climbing[48](index=48&type=chunk)[109](index=109&type=chunk) [Loss Ratio Management](index=4&type=section&id=Loss%20Ratio%20Management) The gross loss ratio improved significantly by 15 points year-over-year to 79%, marking the fourth consecutive quarter of substantial improvement - Gross loss ratio improved by **15 points year-over-year to 79%**, the largest improvement in three years and the fourth consecutive quarter of significant YoY improvement[45](index=45&type=chunk)[69](index=69&type=chunk) - Trailing twelve months (TTM) gross loss ratio improved sequentially by **4 points to 79%** and by **12 points year-over-year**[1](index=1&type=chunk)[45](index=45&type=chunk) - Strategies to reduce CAT-related volatility include: growing products with lower CAT exposure (pet & renters), geographic consideration for homeowners growth (including Europe), and non-renewing certain CAT-exposed homeowners policies, which is expected to impact IFP by **$20-25 million in H2 2024**[50](index=50&type=chunk)[68](index=68&type=chunk) [Operating Leverage](index=6&type=section&id=Operating%20Leverage) Lemonade demonstrated impressive operating leverage, with In Force Premium (IFP) growing at a CAGR of 35% over the past two years, more than three times the 11% CAGR of operating expenses - Over the past 2 years, CAGR of In Force Premium (IFP) was **35%**, more than **3x** the CAGR of operating expense at **11%**[70](index=70&type=chunk) - Excluding growth spend (**80% funded by synthetic agents partners**), all other operating expense was roughly flat[70](index=70&type=chunk) - IFP per headcount improved by **34%** in the past year, and by **over 2x since Q4 2021**, demonstrating the ability to leverage technology for operating efficiencies[70](index=70&type=chunk)[100](index=100&type=chunk) [Detailed Q2 2024 Results and KPIs](index=8&type=section&id=Detailed%20Q2%202024%20Results%20and%20KPIs) This section provides a detailed overview of Lemonade's Q2 2024 financial and operating performance, including customer growth, revenue, profitability, expenses, and cash flow [Customers and In Force Premium](index=8&type=section&id=Customers%20and%20In%20Force%20Premium) Lemonade's customer base expanded by 14% year-over-year, reaching over 2.16 million, while In Force Premium (IFP) grew by 22% to $838.8 million | Metric | Q2 2024 Value | YoY Change | | :-------------------------- | :------------ | :--------- | | Customers (end of period) | 2,167,194 | ↑ 14% | | In Force Premium (IFP) | $838.8 million| ↑ 22% | | Premium per Customer | $387 | ↑ 8% | | Annual Dollar Retention (ADR)| 88% | ↑ 1% | [Revenue and Gross Earned Premium](index=8&type=section&id=Revenue%20and%20Gross%20Earned%20Premium) Total revenue for Q2 2024 increased by 17% to $122.0 million, primarily driven by higher gross earned premium and net investment income | Metric | Q2 2024 Value | Q2 2023 Value | YoY Change | | :-------------------- | :------------ | :------------ | :--------- | | Total Revenue | $122.0 million| $104.6 million| ↑ 17% | | Gross Earned Premium | $199.9 million| $163.9 million| ↑ 22% | [Profitability Metrics](index=9&type=section&id=Profitability%20Metrics) Gross profit surged by 155% to $30.8 million, and adjusted gross profit increased by 101% to $33.4 million, both primarily due to higher earned premium and an improved loss ratio | Metric | Q2 2024 Value | Q2 2023 Value | YoY Change | | :-------------------------- | :------------ | :------------ | :--------- | | Gross Profit | $30.8 million | $12.1 million | ↑ 155% | | Adjusted Gross Profit | $33.4 million | $16.6 million | ↑ 101% | | Gross Profit Margin | 25% | 12% | Doubled | | Adjusted Gross Profit Margin| 27% | 16% | ↑ 11% | [Operating Expenses](index=9&type=section&id=Operating%20Expenses) Total operating expense, excluding net loss and loss adjustment expense, increased by 13% to $106.6 million, mainly driven by a significant increase in growth spend | Metric | Q2 2024 Value | Q2 2023 Value | YoY Change | | :------------------------------------------------------------------ | :------------ | :------------ | :--------- | | Total Operating Expense (excluding net loss & loss adjustment expense) | $106.6 million| $94.6 million | ↑ 13% | | Growth Spend (included in sales and marketing expense) | $25.8 million | $12.5 million | ↑ 106.4% | [Net Loss and Adjusted EBITDA](index=9&type=section&id=Net%20Loss%20and%20Adjusted%20EBITDA) Net loss improved by 15% to ($57.2) million, or ($0.81) per share, while Adjusted EBITDA loss also improved by 18% to ($43.0) million | Metric | Q2 2024 Value | Q2 2023 Value | YoY Change | | :-------------------------- | :------------ | :------------ | :--------- | | Net Loss | ($57.2) million | ($67.2) million | Improved 15% | | Net Loss per Share | ($0.81) | ($0.97) | Improved | | Adjusted EBITDA Loss | ($43.0) million | ($52.7) million | Improved 18% | [Cash & Investments and Net Cash Flow](index=10&type=section&id=Cash%20%26%20Investments%20and%20Net%20Cash%20Flow) The company's cash, cash equivalents, and investments totaled approximately $931 million, with Net Cash Flow turning positive at $4 million in Q2 2024 | Metric | Q2 2024 Value | Q2 2023 Value | | :-------------------------- | :------------ | :------------ | | Cash, Cash Equivalents, and Investments (as of June 30, 2024) | $931 million | | | Net Cash Flow (NCF) | $4 million | ($51) million | [Summary of Key Operating and Financial Metrics](index=11&type=section&id=Summary%20of%20Key%20Operating%20and%20Financial%20Metrics) A comprehensive table provides a snapshot of key operating and financial metrics for the three and six months ended June 30, 2024, and 2023, highlighting significant growth and improvements | Metric | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Customers (end of period) | 2,167,194 | 1,906,408 | 2,167,194 | 1,906,408 | | In force premium (end of period) | $838.8 | $686.6 | $838.8 | $686.6 | | Premium per customer (end of period) | $387 | $360 | $387 | $360 | | Annual dollar retention (end of period)| 88% | 87% | 88% | 87% | | Total revenue | $122.0 | $104.6 | $241.1 | $199.0 | | Gross earned premium | $199.9 | $163.9 | $387.8 | $318.0 | | Gross profit | $30.8 | $12.1 | $65.5 | $28.0 | | Adjusted gross profit | $33.4 | $16.6 | $70.1 | $37.0 | | Net loss | ($57.2) | ($67.2) | ($104.5) | ($133.0) | | Adjusted EBITDA | ($43.0) | ($52.7) | ($76.9) | ($103.0) | | Gross profit margin | 25% | 12% | 27% | 14% | | Adjusted gross profit margin | 27% | 16% | 29% | 19% | | Ratio of Adjusted Gross Profit to Gross Earned Premium | 17% | 10% | 18% | 12% | | Gross loss ratio | 79% | 94% | 79% | 87% | | Net loss ratio | 79% | 99% | 78% | 87% | [Financial Guidance](index=12&type=section&id=Financial%20Guidance) This section outlines Lemonade's financial guidance for Q3 and full-year 2024, including projections for key metrics like In Force Premium, revenue, and Adjusted EBITDA [Third Quarter 2024 Guidance](index=12&type=section&id=Third%20Quarter%202024%20Guidance) For the third quarter of 2024, Lemonade anticipates In Force Premium between $875-$879 million, Gross Earned Premium of $208-$210 million, and Revenue of $124-$126 million | Metric | Q3 2024 Low | Q3 2024 High | | :------------------------------------- | :---------- | :----------- | | In force premium (as of Sep 30, 2024) | $875 million| $879 million | | Gross earned premium | $208 million| $210 million | | Revenue | $124 million| $126 million | | Adjusted EBITDA loss | ($58) million| ($56) million | | Stock-based compensation expense | ~$17 million| | | Capital expenditures | ~$3 million | | | Weighted total common shares outstanding| ~71 million | | [Full Year 2024 Guidance](index=12&type=section&id=Full%20Year%202024%20Guidance) Lemonade reaffirms its full-year 2024 guidance, projecting In Force Premium of $940-$944 million, Gross Earned Premium of $818-$822 million, and Revenue of $511-$515 million - Lemonade is reaffirming its guidance for FY 2024 across all metrics[84](index=84&type=chunk) | Metric | FY 2024 Low | FY 2024 High | | :------------------------------------- | :---------- | :----------- | | In force premium (as of Dec 31, 2024) | $940 million| $944 million | | Gross earned premium | $818 million| $822 million | | Revenue | $511 million| $515 million | | Adjusted EBITDA loss | ($155) million| ($151) million | | Stock-based compensation expense | ~$64 million| | | Capital expenditures | ~$10 million| | | Weighted total common shares outstanding| ~71 million | | [Non-GAAP Financial Measures and Key Operating Metrics Definitions](index=14&type=section&id=Non-GAAP%20Financial%20Measures%20and%20Key%20Operating%20Metrics%20Definitions) This section defines Lemonade's non-GAAP financial measures and key operating metrics, explaining their calculation and relevance for performance evaluation [Adjusted EBITDA](index=14&type=section&id=Adjusted%20EBITDA) Adjusted EBITDA is a non-GAAP financial measure used by management to monitor and evaluate business performance, facilitate comparisons, and inform strategic planning - Adjusted EBITDA is a non-GAAP measure that excludes various non-operating and non-cash items from net loss to provide insight into underlying operating performance[87](index=87&type=chunk) - Management uses Adjusted EBITDA to monitor business performance, facilitate comparisons, assess management team performance, and inform financial and strategic planning decisions[16](index=16&type=chunk)[87](index=87&type=chunk) [Adjusted Gross Profit and Ratio of Adjusted Gross Profit to Gross Earned Premium](index=14&type=section&id=Adjusted%20Gross%20Profit%20and%20Ratio%20of%20Adjusted%20Gross%20Profit%20to%20Gross%20Earned%20Premium) Adjusted Gross Profit is a non-GAAP measure that adjusts gross profit to focus on variable costs and underlying profitability trends, while its ratio to Gross Earned Premium assesses business volume and economic benefit - Adjusted Gross Profit is a non-GAAP measure that excludes net investment income, interest income, and net realized gains/losses on investments, while including fixed costs and overhead associated with underwriting operations[139](index=139&type=chunk) - This measure is used to evaluate the variable contribution from underwriting operations and track progress towards profitability[139](index=139&type=chunk) - The Ratio of Adjusted Gross Profit to Gross Earned Premium assesses the relationship between business volume, gross economic benefit, and underlying profitability trends[15](index=15&type=chunk)[38](index=38&type=chunk) [Key Operating Metrics Definitions](index=16&type=section&id=Key%20Operating%20Metrics%20Definitions) This section defines key operating metrics used by Lemonade, providing insight into customer growth, premium generation, retention, underwriting performance, and cash management - Customers are defined as current policyholders, with each unique customer counted once regardless of multiple policies, driving revenue, brand awareness, market penetration, and data generation[119](index=119&type=chunk) - In Force Premium (IFP) represents the aggregate annualized premium for customers, including both underwritten and placed policies, capturing growth in customers and premium per customer[135](index=135&type=chunk) - Annual Dollar Retention (ADR) measures the percentage of IFP retained over a twelve-month period, reflecting customer retention and the ability to sell additional products[120](index=120&type=chunk) - Gross Earned Premium (GEP) is the earned portion of gross written premium, excluding ceded premiums, providing insight into gross economic benefit and underwriting performance[26](index=26&type=chunk) - Gross Loss Ratio, Net Loss Ratio, TTM Gross Loss Ratio, and Gross Loss Ratio ex-CAT are defined as ratios of losses and loss adjustment expense to earned premium, with variations for ceded amounts, trailing periods, and catastrophic losses, to assess underwriting performance[19](index=19&type=chunk)[92](index=92&type=chunk)[121](index=121&type=chunk)[129](index=129&type=chunk) - Net Cash Flow (NCF) is defined as the change in total cash, cash equivalents, restricted cash, and investments[27](index=27&type=chunk) [Corporate Information and Disclosures](index=19&type=section&id=Corporate%20Information%20and%20Disclosures) This section provides corporate information, including earnings call details, company overview, forward-looking statements, risk factors, and official disclosure channels [Earnings Teleconference Information](index=19&type=section&id=Earnings%20Teleconference%20Information) Lemonade's Q2 2024 financial results and business outlook were discussed during a teleconference on July 31, 2024, with a replay available on the investor relations website - The Q2 2024 financial results and business outlook teleconference was held on **July 31, 2024, at 8:00 AM ET**[39](index=39&type=chunk) - A live audio webcast and recorded replay are available on the investor relations section of Lemonade's website (investor.lemonade.com)[21](index=21&type=chunk)[123](index=123&type=chunk) [About Lemonade](index=19&type=section&id=About%20Lemonade) Lemonade is an AI-powered insurance company offering various insurance products globally, operating as a Certified B-Corp with a focus on instant services and social impact - Lemonade offers renters, homeowners, pet, car, and life insurance, powered by artificial intelligence and behavioral economics[94](index=94&type=chunk) - The company operates as a **Certified B-Corp**, aiming for zero paperwork and instant services, and conducts an annual Giveback to nonprofits[94](index=94&type=chunk) - Lemonade is available in the United States, UK, Germany, Netherlands, and France, with ongoing global expansion[94](index=94&type=chunk) [Forward-Looking Statements and Risk Factors](index=20&type=section&id=Forward-Looking%20Statements%20and%20Risk%20Factors) The shareholder letter contains forward-looking statements regarding anticipated financial performance and strategic plans, which involve known and unknown risks and uncertainties - The letter contains forward-looking statements about anticipated financial performance, upgraded guidance, future profitability, AI model benefits, growth, and business strategy[30](index=30&type=chunk)[36](index=36&type=chunk) - These statements involve known and unknown risks and uncertainties, including history of losses, customer retention, brand reputation, claims management, reinsurance availability, limited operating history, and ability to manage growth[95](index=95&type=chunk) - Other significant risks include AI algorithm performance, intense competition, regulatory compliance, product expansion, business model novelty, and impacts of severe weather and climate change[95](index=95&type=chunk)[125](index=125&type=chunk) [News & Information Disclosure](index=22&type=section&id=News%20%26%20Information%20Disclosure) Lemonade uses its investor website, blog, and social media as official channels for disclosing material information and complying with Regulation FD - Lemonade uses its investor website, blog, and company social media accounts (X, LinkedIn) for disclosing material information and complying with Regulation FD[23](index=23&type=chunk) - Investors should monitor these channels alongside press releases, SEC filings, and public conference calls[23](index=23&type=chunk) [Condensed Consolidated Financial Statements](index=23&type=section&id=Condensed%20Consolidated%20Financial%20Statements) This section presents Lemonade's condensed consolidated financial statements, including statements of operations, balance sheets, and cash flows for Q2 2024 and prior periods [Condensed Consolidated Statements of Operations](index=23&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) The Condensed Consolidated Statements of Operations present the company's revenues and expenses for the three and six months ended June 30, 2024, and 2023, showing an improved net loss | Metric | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :-------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net earned premium | $89.3 | $76.5 | $173.7 | $149.0 | | Ceding commission income | $16.5 | $17.5 | $37.5 | $35.0 | | Net investment income | $8.1 | $5.6 | $15.7 | $10.0 | | Commission and other income | $8.1 | $5.0 | $14.2 | $5.0 | | **Total revenue** | **$122.0** | **$104.6** | **$241.1** | **$199.0** | | Loss and loss adjustment expense, net | $70.5 | $75.9 | $136.4 | $139.0 | | Other insurance expense | $18.8 | $15.0 | $36.1 | $28.0 | | Sales and marketing | $36.8 | $24.8 | $67.2 | $47.0 | | Technology development | $21.2 | $24.1 | $42.1 | $47.0 | | General and administrative | $29.8 | $30.7 | $59.6 | $60.0 | | **Total expense** | **$177.1** | **$170.5** | **$341.4** | **$321.0** | | Loss before income taxes | ($55.1) | ($65.9) | ($100.3) | ($122.0) | | Income tax expense | $2.1 | $1.3 | $4.2 | $2.0 | | **Net loss** | **($57.2)** | **($67.2)** | **($104.5)** | **($124.0)** | | Net loss per share - basic and diluted | ($0.81) | ($0.97) | ($1.48) | ($1.79) | | Weighted average common shares outstanding - basic and diluted | 70,721,227 | 69,534,731 | 70,502,856 | 69,434,000 | [Condensed Consolidated Balance Sheets](index=24&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The Condensed Consolidated Balance Sheets provide a snapshot of assets, liabilities, and stockholders' equity as of June 30, 2024, and December 31, 2023 | Metric | June 30, 2024 | December 31, 2023 | | :------------------------------------------------------------------------------------------------- | :------------ | :---------------- | | **Assets** | | | | Fixed maturities available-for-sale, at fair value | $537.2 | $632.0 | | Short-term investments | $44.0 | $45.8 | | Total investments | $581.2 | $677.8 | | Cash, cash equivalents and restricted cash | $349.7 | $271.5 | | Premium receivable, net | $259.7 | $216.7 | | Reinsurance recoverable | $203.0 | $138.4 | | Prepaid reinsurance premium | $218.2 | $196.3 | | Deferred acquisition costs | $11.2 | $8.8 | | Property and equipment, net | $16.3 | $16.6 | | Intangible assets | $18.2 | $18.4 | | Goodwill | $19.0 | $19.0 | | Other assets | $37.4 | $61.4 | | **Total assets** | **$1,713.9** | **$1,673.0** | | **Liabilities and Stockholders' Equity** | | | | Unpaid loss and loss adjustment expense | $282.2 | $262.3 | | Unearned premium | $397.6 | $353.7 | | Trade payables | $0.6 | $0.6 | | Funds held for reinsurance treaties | $157.3 | $128.8 | | Deferred ceding commission | $46.3 | $41.4 | | Ceded premium payable | $29.6 | $23.2 | | Borrowings under financing agreement | $43.9 | $14.9 | | Other liabilities and accrued expenses | $121.2 | $109.2 | | **Total liabilities** | **$1,078.7** | **$934.1** | | Common stock, $0.00001 par value, 200,000,000 shares authorized; 71,002,862 and 70,163,703 shares issued and outstanding as of June 30, 2024 and December 31, 2023, respectively | $1.8 | $1.8 | | Additional paid-in capital | $1,713.9 | $1,690.0 | | Accumulated other comprehensive loss | ($8.6) | ($10.0) | | Accumulated deficit | ($1,071.9) | ($942.9) | | **Total stockholders' equity** | **$635.2** | **$738.9** | | **Total liabilities and stockholders' equity** | **$1,713.9** | **$1,673.0** | [Condensed Consolidated Statements of Cash Flows](index=25&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) The Condensed Consolidated Statements of Cash Flows detail the cash movements from operating, investing, and financing activities, showing a net increase in cash for the six-month period | Cash Flow Activity | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :-------------------------------------------------------- | :----------------------------- | :----------------------------- | | Net cash used in operating activities | ($41.5) | ($58.0) | | Net cash provided by investing activities | $92.2 | $21.0 | | Net cash provided by financing activities | $29.1 | $15.0 | | Effect of exchange rate changes on cash | ($1.6) | ($1.0) | | Net increase (decrease) in cash, cash equivalents and restricted cash | $78.2 | ($23.0) | | Cash, cash equivalents and restricted cash at beginning of period | $271.5 | $280.0 | | Cash, cash equivalents and restricted cash at end of period | $349.7 | $257.0 | [Reconciliation of Non-GAAP Financial Measures to GAAP](index=26&type=section&id=Reconciliation%20of%20Non-GAAP%20Financial%20Measures%20to%20GAAP) This section provides detailed reconciliations of non-GAAP financial measures, including Adjusted Gross Profit, Adjusted EBITDA, and their respective ratios, to their GAAP equivalents [Adjusted Gross Profit and Adjusted Gross Profit Margin Reconciliation](index=26&type=section&id=Adjusted%20Gross%20Profit%20and%20Adjusted%20Gross%20Profit%20Margin%20Reconciliation) This section reconciles total revenue to adjusted gross profit and its margin, detailing adjustments made to GAAP gross profit to arrive at the non-GAAP adjusted figures | Metric | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :-------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Total revenue | $122.0 | $104.6 | $241.1 | $199.0 | | Loss and loss adjustment expense, net | ($70.5) | ($75.9) | ($136.4) | ($139.0) | | Other insurance expense | ($18.8) | ($15.0) | ($36.1) | ($28.0) | | Depreciation and amortization | ($1.9) | ($1.6) | ($3.1) | ($3.0) | | **Gross profit** | **$30.8** | **$12.1** | **$65.5** | **$28.0** | | Gross profit margin (% of total revenue)| 25% | 12% | 27% | 14% | | Net investment income | ($8.1) | ($5.6) | ($15.7) | ($10.0) | | Interest income and other income | ($2.3) | ($0.8) | ($4.5) | ($1.0) | | Employee-related expense | $5.1 | $4.7 | $10.5 | $9.0 | | Professional fees and other | $6.0 | $4.6 | $11.2 | $8.0 | | Depreciation and amortization | $1.9 | $1.6 | $3.1 | $3.0 | | **Adjusted gross profit** | **$33.4** | **$16.6** | **$70.1** | **$37.0** | | Adjusted gross profit margin (% of total revenue)| 27% | 16% | 29% | 19% | [Adjusted EBITDA Reconciliation](index=27&type=section&id=Adjusted%20EBITDA%20Reconciliation) This table reconciles net loss to Adjusted EBITDA, detailing specific adjustments added back to net loss to derive the non-GAAP Adjusted EBITDA figure | Metric | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :------------------------------------------------------------------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net loss | ($57.2) | ($67.2) | ($104.5) | ($124.0) | | Income tax expense | $2.1 | $1.3 | $4.2 | $2.0 | | Depreciation and amortization | $5.2 | $5.0 | $10.2 | $10.0 | | Stock-based compensation | $15.4 | $14.8 | $30.3 | $29.0 | | Interest expense | $1.1 | - | $1.7 | - | | Interest income and others | ($1.6) | ($0.8) | ($3.1) | ($1.0) | | Net investment income | ($8.1) | ($5.6) | ($15.7) | ($10.0) | | Change in fair value of warrants liability | - | - | - | - | | Amortization of fair value adjustment on insurance contract intangible liability relating to the Metromile acquisition | ($0.1) | ($0.2) | ($0.2) | ($0.0) | | Other adjustments | $0.2 | - | $0.2 | - | | **Adjusted EBITDA** | **($43.0)** | **($52.7)** | **($76.9)** | **($103.0)** | [Ratio of Adjusted Gross Profit to Gross Earned Premium Reconciliation](index=27&type=section&id=Ratio%20of%20Adjusted%20Gross%20Profit%20to%20Gross%20Earned%20Premium%20Reconciliation) This table presents the calculation of the Ratio of Adjusted Gross Profit to Gross Earned Premium, indicating the relationship between the company's underlying profitability and its gross business volume | Metric | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :--------------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Numerator: Adjusted gross profit | $33.4 | $16.6 | $70.1 | $37.0 | | Denominator: Gross earned premium | $199.9 | $163.9 | $387.8 | $318.0 | | Ratio of Adjusted Gross Profit to Gross Earned Premium | 17% | 10% | 18% | 12% | [Supplemental Financial Information](index=28&type=section&id=Supplemental%20Financial%20Information) This section offers supplemental financial data, including stock-based compensation, detailed premium figures, and historical operating metrics for trend analysis [Stock-based Compensation](index=28&type=section&id=Stock-based%20Compensation) This section provides a breakdown of stock-based compensation expense across various operational categories for the three and six months ended June 30, 2024, and 2023 | Expense Category | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Loss and loss adjustment expense, net | $0.5 | $0.7 | $1.0 | $1.0 | | Other insurance expense | $0.6 | $0.5 | $1.2 | $1.0 | | Sales and marketing | $2.6 | $1.5 | $4.6 | $3.0 | | Technology development | $6.4 | $6.3 | $12.8 | $12.0 | | General and administrative | $5.3 | $5.8 | $10.7 | $11.0 | | **Total stock-based compensation expense** | **$15.4** | **$14.8** | **$30.3** | **$28.0** | | Compensation expense related to warrant shares | $1.6 | $0.6 | $2.5 | $0.6 | [Written and Earned Premium](index=28&type=section&id=Written%20and%20Earned%20Premium) This table details gross, ceded, and net written and earned premiums for the three and six months ended June 30, 2024, and 2023 | Premium Type | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Gross written premium | $226.2 | $181.9 | $431.8 | $350.0 | | Ceded written premium | ($124.3) | ($94.1) | ($236.0) | ($180.0) | | **Net written premium** | **$101.9** | **$87.8** | **$195.8** | **$170.0** | | Gross earned premium | $199.9 | $163.9 | $387.8 | $318.0 | | Ceded earned premium | ($110.6) | ($87.4) | ($214.1) | ($169.0) | | **Net earned premium** | **$89.3** | **$76.5** | **$173.7** | **$149.0** | [Historical Operating Metrics](index=29&type=section&id=Historical%20Operating%20Metrics) This table provides a historical overview of key operating and financial metrics from June 30, 2022, to June 30, 2024, illustrating trends over the past two years | Metric | Jun. 30, 2022 | Sept. 30, 2022 | Dec. 31, 2022 | Mar. 31, 2023 | Jun. 30, 2023 | Sep. 30, 2023 | Dec. 31, 2023 | Mar. 31, 2024 | Jun. 30, 2024 | | :------------------------------------- | :------------ | :------------- | :------------ | :------------ | :------------ | :------------ | :------------ | :------------ | :------------ | | Customers (end of period) | 1,579,936 | 1,775,824 | 1,807,548 | 1,856,012 | 1,906,408 | 1,984,154 | 2,026,918 | 2,095,275 | 2,167,194 | | In force premium (end of period) | $457.6 | $609.2 | $625.1 | $653.3 | $686.6 | $719.0 | $747.3 | $794.2 | $838.8 | | Premium per customer (end of period) | $290 | $343 | $346 | $352 | $360 | $362 | $369 | $379 | $387 | | Annual dollar retention (end of period)| 83% | 84% | 86% | 87% | 87% | 85% | 87% | 88% | 88% | | Total revenue | $50.0 | $74.0 | $88.4 | $95.2 | $104.6 | $114.5 | $115.5 | $119.1 | $122.0 | | Gross earned premium | $106.8 | $136.4 | $151.3 | $154.2 | $163.9 | $173.2 | $181.0 | $187.9 | $199.9 | | Gross profit | $11.3 | $8.1 | $12.7 | $16.5 | $12.1 | $21.9 | $33.6 | $34.7 | $30.8 | | Adjusted gross profit | $17.5 | $13.2 | $17.9 | $20.6 | $16.6 | $24.9 | $35.3 | $36.7 | $33.4 | | Net loss | ($67.9) | ($91.4) | ($63.7) | ($65.8) | ($67.2) | ($61.5) | ($42.4) | ($47.3) | ($57.2) | | Adjusted EBITDA | ($50.3) | ($65.7) | ($51.7) | ($50.8) | ($52.7) | ($40.2) | ($28.9) | ($33.9) | ($43.0) | | Gross profit margin | 23% | 11% | 14% | 17% | 12% | 19% | 29% | 29% | 25% | | Adjusted gross profit margin | 35% | 18% | 20% | 22% | 16% | 22% | 31% | 31% | 27% | | Ratio of Adjusted Gross Profit to Gross Earned Premium | 16% | 10% | 12% | 13% | 10% | 14% | 20% | 20% | 17% | | Gross loss ratio | 86% | 94% | 89% | 87% | 94% | 83% | 77% | 79% | 79% | | Net loss ratio | 90% | 105% | 97% | 93% | 99% | 88% | 78% | 78% | 79% | [Appendix: Q2 2024 Shareholder Letter Visuals](index=30&type=section&id=Appendix%3A%20Q2%202024%20Shareholder%20Letter%20Visuals) This appendix provides visual representations of key Q2 2024 financial and operating trends, including customer growth, premium, revenue, profitability, expenses, cash flow, and guidance [Customers, Premium Per Customer, In Force Premium](index=31&type=section&id=Customers%2C%20Premium%20Per%20Customer%2C%20In%20Force%20Premium) Visual representations of the growth trends for customers, premium per customer, and in force premium, highlighting year-over-year increases and overall expansion - Charts illustrate a **14% YoY growth in customers to 2,167,000**, an **8% YoY growth in premium per customer to $387**, and a **22% YoY growth in In Force Premium to $839 million**[43](index=43&type=chunk)[163](index=163&type=chunk) [Gross Earned Premium & Revenue](index=32&type=section&id=Gross%20Earned%20Premium%20%26%20Revenue) Charts depicting the year-over-year growth in Gross Earned Premium and Total Revenue, showing a 22% increase in GEP to $199.9 million and a 17% increase in revenue to $122.0 million for Q2 2024 - Gross Earned Premium grew **22% YoY to $199.9 million**, and Revenue grew **17% YoY to $122.0 million** in Q2 2024[147](index=147&type=chunk) [Loss Ratio Trends](index=33&type=section&id=Loss%20Ratio%20Trends) Visuals demonstrating the improvement in Gross Loss Ratio, Net Loss Ratio, and Gross Loss Ratio ex-CAT, both quarterly and on a trailing twelve-month basis - Gross Loss Ratio improved to **79% in Q2 2024 from 94% in Q2 2023**; Net Loss Ratio also improved to **79% from 99%**[149](index=149&type=chunk)[150](index=150&type=chunk) - Trailing Twelve Month (TTM) Gross Loss Ratio showed consistent improvement, reaching **79% in Q2 2024**[167](index=167&type=chunk)[168](index=168&type=chunk) [Gross Profit & Adjusted Gross Profit](index=35&type=section&id=Gross%20Profit%20%26%20Adjusted%20Gross%20Profit) Charts illustrating the significant year-over-year growth in Gross Profit and Adjusted Gross Profit, with increases of 155% and 101% respectively in Q2 2024 - Gross Profit increased by **155% YoY to $30.8 million** in Q2 2024[171](index=171&type=chunk) - Adjusted Gross Profit increased by **101% YoY to $33.4 million** in Q2 2024[173](index=173&type=chunk) [Operating Expenses](index=37&type=section&id=Operating%20Expenses) A chart showing the trend of operating expenses, excluding loss and loss adjustment expense, which increased to $106.6 million in Q2 2024 primarily due to higher growth spend - Operating Expenses (excluding loss and loss adjustment expense) increased to **$106.6 million in Q2 2024** from **$94.6 million in Q2 2023**[158](index=158&type=chunk) [Adjusted EBITDA & Net Loss](index=38&type=section&id=Adjusted%20EBITDA%20%26%20Net%20Loss) Charts depicting the improvement in Adjusted EBITDA and Net Loss, with the Adjusted EBITDA loss improving by 18% and Net Loss by 15% year-over-year in Q2 2024 - Adjusted EBITDA loss improved by **18% YoY to ($43.0) million** in Q2 2024[152](index=152&type=chunk) - Net Loss improved by **15% YoY to ($57.2) million** in Q2 2024[152](index=152&type=chunk)[160](index=160&type=chunk) [Net Cash Flow & Total Cash & Investments](index=39&type=section&id=Net%20Cash%20Flow%20%26%20Total%20Cash%20%26%20Investments) Visuals illustrating the positive shift in Net Cash Flow, turning positive at $4 million in Q2 2024, and the stability of Total Cash & Investments at $931 million - Net Cash Flow (NCF) was **$4 million in Q2 2024**, a significant improvement from **($51) million in Q2 2023**[155](index=155&type=chunk) - Total Cash & Investments stood at **$931 million in Q2 2024**[155](index=155&type=chunk) [Guidance Summary](index=40&type=section&id=Guidance%20Summary) A table summarizing the financial guidance for Q3 2024 and Full Year 2024, including projected ranges for In Force Premium, Gross Earned Premium, Revenue, and Adjusted EBITDA loss | Metric | Q3 2024 Low | Q3 2024 High | Full Year 2024 Low | Full Year 2024 High | | :------------------------------------- | :---------- | :----------- | :----------------- | :------------------ | | In force premium (as of end of period) | $875 | $879 | $940 | $944 | | Gross Earned Premium | $208 | $210 | $818 | $822 | | Revenue | $124 | $126 | $511 | $515 | | Adj. EBITDA | ($58) | ($56) | ($155) | ($151) |

Bottom Line An earnings beat or miss may not be the sole basis for a stock moving higher or lower. Many stocks end up losing ground despite an earnings beat due to other factors that disappoint investors. Similarly, unforeseen catalysts help a number of stocks gain despite an earnings miss. That said, betting on stocks that are expected to beat earnings expectations does increase the odds of success. This is why it's worth checking a company's Earnings ESP and Zacks Rank ahead of its quarterly release. Make ...

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Group 1: S&T Bank's Initiative - S&T Bank will hold its second annual Lemonade Days fundraising campaign from June 1 to June 8, 2024, to benefit Alex's Lemonade Stand Foundation (ALSF) [1][2] - The campaign allows visitors to S&T Bank branches to donate to ALSF and receive complimentary lemonade and treats [1][2] Group 2: Partnership and Impact - S&T Bank's CEO Chris McComish highlighted the expansion of their partnership with ALSF, emphasizing the bank's commitment to community support [3] - In 2023, S&T Bank raised over $30,000 for ALSF in Central and Southeastern Pennsylvania, with plans to expand lemonade stands across all markets in 2024 [3] Group 3: About ALSF - ALSF was founded by Alex Scott, who raised $1 million for childhood cancer research before her passing at age eight [5] - The foundation has grown into the largest independent childhood cancer charity in the U.S., funding pediatric cancer research and supporting affected families [5] Group 4: Company Overview - S&T Bancorp Inc. is a $9.5 billion bank holding company headquartered in Indiana, Pennsylvania, and trades on NASDAQ under the symbol STBA [4] - S&T Bank has been recognized as a Best-in-State Bank by Forbes in 2023 and as one of America's Best Banks in 2024 [4]

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Core Insights - The KIT KAT® brand is launching a new limited-edition flavor, the KIT KAT® Pink Lemonade Flavored Bar, aimed at enhancing summer experiences for consumers [1][3] - This new flavor features classic wafers with a pink lemonade flavored creme, appealing to the taste preferences of Gen Z and Millennials, with over 93% expressing a preference for Pink Lemonade treats [3][4] - The product will be available nationwide starting May 17, 2024, in both standard and king size packages [2][3] Company Overview - The Hershey Company is a leading snacks company with over 20,000 employees globally, generating more than $11.2 billion in annual revenues from its extensive portfolio of over 90 brand names [6] - The company is committed to ethical and sustainable operations, with a long-standing focus on community support and education initiatives [7]