Lemonade(US:LMND)2024-07-31 20:50Financial Performance - Total revenue for the three months ended June 30, 2024, was $122.0 million, an increase of 16.4% compared to $104.6 million for the same period in 2023[21] - Net earned premium for the three months ended June 30, 2024, was $89.3 million, up from $76.5 million in the prior year, representing a growth of 16.5%[21] - Net loss for the three months ended June 30, 2024, was $57.2 million, a slight improvement from a net loss of $67.2 million in the same period of 2023[21] - The company reported a comprehensive loss of $56.6 million for the three months ended June 30, 2024, compared to a comprehensive loss of $65.9 million in the same period of 2023[20] - The net loss for the six months ended June 30, 2024, was $104.5 million, an improvement compared to a net loss of $133.0 million for the same period in 2023[25] - Basic and diluted net loss per share attributable to common stockholders for the three months ended June 30, 2024, was $(0.81), compared to $(0.97) for the same period in 2023, representing a 16.5% improvement[81] - The net loss attributable to common stockholders for the six months ended June 30, 2024, was $(104.5) million, a decrease from $(133.0) million in 2023, indicating a 21.5% reduction in losses[81] Assets and Liabilities - Total assets as of June 30, 2024, amounted to $1,713.9 million, an increase from $1,633.3 million as of December 31, 2023[18] - Total liabilities increased to $1,078.7 million as of June 30, 2024, compared to $924.4 million at the end of 2023[18] - Cash, cash equivalents, and restricted cash increased to $349.7 million as of June 30, 2024, compared to $271.5 million at the end of 2023[18] - As of June 30, 2024, total stockholders' equity was $635.2 million, a decrease from $708.9 million as of December 31, 2023[24] - Other liabilities and accrued expenses increased to $121.2 million as of June 30, 2024, up from $99.5 million at the end of 2023[62] Investment and Financial Assets - The company's net investment income for the three months ended June 30, 2024, was $8.1 million, compared to $5.6 million for the same period in 2023, representing a 45% increase[38] - The fair value of corporate debt securities was $435.9 million as of June 30, 2024, compared to $449.9 million as of December 31, 2023[35] - The total fair value of financial assets measured as of June 30, 2024, was $581.2 million[44] - Total financial assets amounted to $673.2 million as of June 30, 2024, with fixed maturities contributing $627.4 million and short-term investments at $45.8 million[45] - The company held restricted investments of $84.5 million as of June 30, 2024, which are secured under a reinsurance contract[43] Operational Expenses - Sales and marketing expenses rose to $36.8 million for the three months ended June 30, 2024, compared to $24.8 million in the same period of 2023, reflecting a 48.4% increase[21] - Stock-based compensation for the six months ended June 30, 2024, was $30.3 million, slightly higher than $30.2 million for the same period in 2023[25] - The total stock-based compensation expense for the six months ended June 30, 2024, was $30.3 million, compared to $30.2 million for the same period in 2023[76] Shareholder Information - Weighted average common shares outstanding for the three months ended June 30, 2024, were 70,721,227, compared to 69,534,731 for the same period in 2023[22] - The total number of shares outstanding increased to 71,002,862 as of June 30, 2024, from 70,478,088 as of March 31, 2024[24] - The total number of options to purchase common stock increased to 9,988,565 as of June 30, 2024, from 9,264,477 in 2023, reflecting a 7.8% increase[83] Reinsurance and Premiums - The company ceded 55% of premiums and losses to reinsurers under its proportional reinsurance contracts effective July 1, 2023[54] - Gross written premium for the three months ended June 30, 2024, was $226.2 million, up from $181.9 million in 2023, marking a 24.4% year-over-year growth[89] - California accounted for 24.4% of gross written premium in Q2 2024, while Texas contributed 15.9%, showing a slight decrease in Texas's share from 17.3% in Q2 2023[89] Tax and Compliance - The consolidated effective tax rate was (4.2)% for the six months ended June 30, 2024, compared to (1.8)% for the same period in 2023[79] - The Company's unrecognized tax benefits amounted to $15.7 million as of June 30, 2024, an increase from $9.6 million in 2023, primarily due to transfer pricing methodology[80] Strategic Initiatives - The company is actively evaluating the impact of geopolitical uncertainties in Israel on its operations and financial condition[28] - The company continues to focus on its growth strategy, including potential market expansion and new product development[26] - The company entered into an Amended and Restated Customer Investment Agreement providing up to an additional $140 million of financing for sales and marketing growth efforts[59] Accounting and Reporting - The company is currently evaluating the impact of new accounting standards related to segment reporting and income tax disclosures[32][33] - The company does not intend to sell investments in fixed maturities despite unrealized losses, indicating a long-term investment strategy[41]