Core Investment Thesis - The article highlights the potential of three tech stocks—SoundHound AI, Lemonade, and CoreWeave—as promising investment opportunities in the context of the growing artificial intelligence (AI) market, suggesting they may offer more growth potential than volatile cryptocurrencies [1][2]. SoundHound AI - SoundHound AI specializes in AI-powered voice and audio recognition tools, generating most of its revenue from its developer-oriented platform, Houndify, which allows for customized voice recognition applications across various industries [3][5]. - The company has a market capitalization of $4.7 billion, with a current stock price of $11.12, and analysts project a revenue growth rate of 30% CAGR from 2025 to 2027, with adjusted EBITDA expected to turn positive in the final year [4][6]. - SoundHound is expanding its market presence through acquisitions and serves notable clients like Stellantis, Chipotle, and Mastercard, which positions it well in the growing voice recognition services market [5][6]. Lemonade - Lemonade offers a range of insurance products, including homeowners, renters, and pet insurance, and is particularly appealing to younger customers due to its AI-powered app that simplifies the insurance buying process [7][9]. - The company has a market capitalization of $5.9 billion and a current stock price of $79.41, with its customer base expected to grow from 1 million to 2.87 million between the end of 2020 and Q3 2025 [8][9]. - Analysts forecast a revenue and adjusted EBITDA growth rate of 44% CAGR from 2025 to 2027, driven by the expansion of its pet and auto insurance segments and the introduction of more AI features [9][10]. CoreWeave - CoreWeave transitioned from Ethereum mining to providing cloud-based GPU services for AI and machine learning tasks, significantly expanding its data center operations from three to 33 since the end of 2022 [11][12]. - The company has a market capitalization of $50 billion, with a current stock price of $101.23, and claims its GPUs can process AI tasks 35 times faster and 80% more cost-effectively than competitors [12][13]. - Analysts predict a remarkable revenue growth rate of 95% CAGR and adjusted EBITDA growth of 109% CAGR from 2025 to 2027, as it secures more clients, including major players like Microsoft and OpenAI [12][13].

Core Viewpoint - Defiance ETFs has launched the Defiance Daily Target 2X Long LMND ETF (Ticker: LMNX), aimed at providing active traders with leveraged exposure to Lemonade, Inc. (NYSE: LMND), a company known for its innovative insurance technology solutions [1][2]. Group 1: Fund Overview - The LMNX ETF seeks to deliver 200% of the daily percentage change in the share price of Lemonade, Inc., allowing investors to express short-term bullish views on the stock [2][3]. - The fund is designed for knowledgeable investors who understand the risks associated with leveraged investments and are willing to actively monitor their portfolios [6]. Group 2: Underlying Company - Lemonade, Inc. operates as a fully digital insurance company, offering various insurance products including renters, homeowners, car, pet, and life insurance through licensed carriers in the U.S. and Europe [4]. - The company utilizes proprietary AI-driven software and automation to enhance efficiency in policy issuance, claims management, and customer interaction, thereby redefining the traditional insurance experience [4]. Group 3: Investment Strategy - The fund employs a fixed-fee business model and relies on reinsurance agreements to manage underwriting risk and stabilize financial results [4]. - The LMNX ETF is not an investment in Lemonade, Inc. itself, but rather a financial instrument that seeks to leverage the performance of LMND [5].

Core Thesis - Lemonade, Inc. has achieved a historic milestone of $1 billion in-force premium (IFP) in just 8.5 years, making it the fastest insurer to reach this scale [2] - The company's Q2 2025 results show a 29% year-over-year IFP growth to $1.08 billion and a 35% increase in revenue, marking its seventh consecutive quarter of accelerating momentum [2] Financial Performance - Gross loss ratios improved by 12 points to 67% overall and by 13 points in auto to 82%, indicating effective underwriting and risk selection through its AI-driven model [3] - Management has reaffirmed a 2025 adjusted EBITDA loss guidance of $135–$140 million, with expectations of sequential improvement each quarter [3] Competitive Advantage - Lemonade's AI-first platform allows for rapid claims processing, sometimes in under three seconds, and provides compounding data advantages [2] - The company's integrated architecture facilitates cross-selling synergies, margin expansion, and global scalability, distinguishing it from traditional insurers [4] Market Dynamics - The shift towards AI-first platforms in the insurance market positions Lemonade for accelerated growth and improving fundamentals, suggesting potential for durable market leadership [4] - The European business is scaling more efficiently than early U.S. operations, generating twice the new business per growth dollar [3] Historical Context - The stock price of Lemonade has appreciated approximately 90.07% since previous bullish coverage, reflecting the successful execution of its diversification strategy [5] - The current bullish thesis emphasizes the company's AI-driven scale and profitability trajectory, aligning with earlier positive assessments [5]

Core Insights - Lemonade is rapidly transforming the insurance industry by leveraging artificial intelligence to enhance customer experience and operational efficiency [2][5][6] - The company reported a significant increase in customer base and in-force premium, indicating strong business momentum [6][7] - Despite recent stock gains, Lemonade's stock price remains significantly below its peak, suggesting potential for future growth [3][14] Customer Growth - Lemonade's customer base reached a record 2.7 million by the end of Q2 2025, reflecting a 24% year-over-year increase, up from 21% in the previous quarter [6] - The company operates in various insurance markets, including renters, homeowners, pet, life, and car insurance, utilizing AI chatbots for quick quotes and claims processing [5][6] Financial Performance - In Q2 2025, Lemonade's in-force premium (IFP) hit a record $1.08 billion, representing a 29% year-over-year increase, marking the seventh consecutive quarter of accelerated IFP growth [7] - Revenue for Q2 reached $164.1 million, a 35% increase year-over-year, surpassing management's forecast of $158 million [11] - The company raised its full-year revenue guidance for 2025 by $50.5 million, from $662 million to $712.5 million, following strong Q2 results [11] Profitability and Losses - Lemonade reported an adjusted EBITDA loss of $40.9 million in Q2, an improvement from the $43 million loss in the same period last year, indicating progress towards profitability [12] - The company maintains over $1 billion in liquidity, providing ample resources for continued investment in growth initiatives [13] Valuation and Future Outlook - Lemonade's price-to-sales (P/S) ratio has decreased to 6.1, making the stock appear attractive compared to its peak of 90 during the tech frenzy in 2021 [14] - The company aims to grow its IFP to $10 billion over the next decade, suggesting significant long-term growth potential for investors [16]