Trupanion reports 12% revenue growth; Lemonade’s pet portfolio exceeds $500M

American pet insurer Trupanion reported revenue of $384 million (€357M) for the first quarter (Q1) of fiscal year (FY) 2026, ended 31 March, marking a 12% year-over-year (YoY) increase.

Its subscription business continued to support this growth, contributing 70% of total revenue at $269.5 million (€251M), up 16% YoY.

The Seattle-based firm reported net income of $4.9 million (€4.6M), compared to a net loss of $1.5 million (€1.4M) in Q1 2025.

Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) rose 42% YoY to $17.4 million (€16.2M).

Strong compound growth

Adjusted operating income increased 29% YoY to $40 million (€37M). According to Margi Tooth, Chief Executive Officer and President of Trupanion, adjusted operating income has grown at a compound rate of 35% over the past 2 years and 45% over the past 10 years.

“Our subscription business generated the majority of this, contributing $38 million (€35M), which directly translates to record lifetime value per pet up 29% YoY, giving us ongoing confidence to compound the business by investing at continuously higher levels,” Tooth said during the earnings call.

Enrolled pets

Investment in pet acquisition during the quarter accounted for 53% of total adjusted operating income, in line with the long-term growth plan.

As a result, the insurer added approximately 64,700 pets to its ecosystem during the quarter. However, the average acquisition cost per pet increased almost 18% YoY, to $315 (€269).

Total enrolled pets stood at 1,637,665 as of 31 March, down 2% from the same period last year. Meanwhile, subscription-enrolled pets reached 1,105,783, reflecting a 5% YoY increase.

Subscription-adjusted operating margin was 14.2%, the highest Q1 margin in the company’s history, up from 12.9% in the prior year.

Guidance

For FY2026, Trupanion expects total revenue to be in the range of $1.556 billion (€1.45B) to $1.581 billion (€1.47B). Subscription revenue is expected to be between $1.119 billion (€1.04B) and $1.135 billion (€1.06B), representing approximately 14% YoY growth at the midpoint.

Adjusted operating income is expected to be in the range of $173 million (€161M) to $187 million (€174M), or 19% YoY growth at the midpoint.

For Q2, total revenue is expected to be in the range of $386 million (€359M) to $392 million (€365M), while subscription revenue is projected to be between $274 million (€255M) and $277 million (€258M), representing approximately 14% YoY growth at the midpoint.

Total adjusted operating income is expected to be in the range of $40 million (€37M) to $43 million (€40M), representing approximately 19% YoY growth at the midpoint.

Lemonade financials

New York-based insurance provider Lemonade’s pet portfolio surpassed $500 million (€460M) in in-force premium (IFP) – the total annualized value of all active policies – at the end of Q1 FY2026.

Premiums per customer stood at $822 (€756), the highest level since Q1 2025. This performance makes pet insurance the company’s largest line of business.

Additionally, Lemonade’s pet segment recorded an IFP growth rate of 55%, compared to the industry average of 17%, and a gross loss ratio (measuring the relationship between losses and gross earned premium) of 66%, versus the industry average of 68%, according to data released by the company.

Lemonade also benefited from high conversion rates driven by AI-powered customer experiences and a diversified distribution strategy spanning direct-to-consumer channels and partnerships.

US pet insurance market

Credit rating agency S&P reports that the US pet insurance market expanded by over 10% in 2025, consistent with growth trends over the past 7 years.

Net premiums earned, which increased 11% YoY, hit an industry record of $3.6 billion (€3.3B). However, 2025 performance reflects a slowdown in growth compared with 2024, when net premiums earned soared 26.6% to $3.23 billion (€3B).

Trupanion was the top underwriter in the market, reporting $1.2 billion (€1.1B) in direct premiums written in the US in 2025, up approximately 11.7% YoY.

Meanwhile, Lemonade reported significant growth, with $441.2 million (€406M) in 2025 direct premiums, up 54.7% YoY from $285.2 million (€262M).