Q3 FY2026
Filed Nov 3, 2026Lime reports Q3 2026 revenue of $360,628 thousand, up 20% year-over-year, and net income of $43,709 thousand, up 41%; Adjusted EBITDA margin declines to 32.8%
Revenue growth (up 20%), GAAP net income growth (up 41%) and Adjusted EBITDA growth to $118,437 thousand are offset by lower GAAP gross margin (44.6% vs 47.3%), lower operating profit ($64,523 thousand vs $68,903 thousand), lower Adjusted EBITDA margin (32.8% vs 35.4%), and a sharp fall in nine-month free cash flow ($7,257 thousand vs $78,892 thousand). Management says near-term margins may be temporarily affected by market investments and LimePrime.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Revenue, Q3 2026GAAP | $360.6M | – | 20% |
| Cost of revenue, Q3 2026GAAP | 199.7M | – | – |
| Gross profit, Q3 2026GAAP | 161.0M | – | – |
| Gross margin, Q3 2026GAAP | 44.6% | – | – |
| Selling, general and administrative, Q3 2026GAAP | 59.23M | – | – |
| Operations and support, Q3 2026GAAP | 15.54M | – | – |
| Research and development, Q3 2026GAAP | 21.66M | – | – |
| Total operating expenses, Q3 2026GAAP | 96.43M | – | – |
| Operating profit, Q3 2026GAAP | 64.52M | – | – |
| Interest expense, Q3 2026GAAP | −656K | – | – |
| Other income (expense), net, Q3 2026GAAP | 4.28M | – | – |
| Income before income taxes, Q3 2026GAAP | 68.14M | – | – |
| Provision for income taxes, Q3 2026GAAP | 24.44M | – | – |
| Net income, Q3 2026GAAP | $43.71M | – | 41% |
| Net income margin, Q3 2026GAAP | 12% | – | – |
| Diluted EPS, Q3 2026GAAP | $0.63 | – | – |
| Basic EPS, Q3 2026GAAP | $0.67 | – | – |
| Adjusted EBITDA, Q3 2026non-GAAP | $118.4M | – | – |
| Adjusted EBITDA margin, Q3 2026non-GAAP | 32.8% | – | – |
| Adjusted Gross Profit, Q3 2026non-GAAP | $195.1M | – | – |
| Adjusted Gross Margin, Q3 2026non-GAAP | 54.1% | – | – |
| Average Operational Fleet, Q3 2026other | 447,184 vehicles | – | 26% |
| Net cash provided by operating activities, Q3 2026GAAP | $114.6M | – | – |
| Capital expenditures (free cash flow reconciliation), Q3 2026non-GAAP | −23.98M | – | – |
| Free Cash Flow, Q3 2026non-GAAP | $90.58M | – | – |
| Revenue, nine months ended September 30, 2026GAAP | $835.0M | – | – |
| Cost of revenue, nine months ended September 30, 2026GAAP | 500.4M | – | – |
| Gross profit, nine months ended September 30, 2026GAAP | 334.6M | – | – |
| Gross margin, nine months ended September 30, 2026GAAP | 40.1% | – | – |
| Selling, general and administrative, nine months ended September 30, 2026GAAP | 171.5M | – | – |
| Operations and support, nine months ended September 30, 2026GAAP | 46.67M | – | – |
| Research and development, nine months ended September 30, 2026GAAP | 68.13M | – | – |
| Total operating expenses, nine months ended September 30, 2026GAAP | 286.3M | – | – |
| Operating profit, nine months ended September 30, 2026GAAP | 48.30M | – | – |
| Interest expense, nine months ended September 30, 2026GAAP | −9.78M | – | – |
| Other income (expense), net, nine months ended September 30, 2026GAAP | −32.86M | – | – |
| Income before income taxes, nine months ended September 30, 2026GAAP | 5.66M | – | – |
| Benefit from income taxes, nine months ended September 30, 2026GAAP | −272.1M | – | – |
| Net income (loss), nine months ended September 30, 2026GAAP | 277.8M | – | – |
| Diluted EPS, nine months ended September 30, 2026GAAP | $5.52 | – | – |
| Basic EPS, nine months ended September 30, 2026GAAP | $9.62 | – | – |
| Adjusted EBITDA, nine months ended September 30, 2026non-GAAP | $210.1M | – | – |
| Adjusted EBITDA margin, nine months ended September 30, 2026non-GAAP | 25.2% | – | – |
| Adjusted Gross Profit, nine months ended September 30, 2026non-GAAP | $427.8M | – | – |
| Adjusted Gross Margin, nine months ended September 30, 2026non-GAAP | 51.2% | – | – |
| Net cash provided by operating activities, nine months ended September 30, 2026GAAP | $163.9M | – | – |
| Capital expenditures (free cash flow reconciliation), nine months ended September 30, 2026non-GAAP | −156.6M | – | – |
| Free Cash Flow, nine months ended September 30, 2026non-GAAP | $7.26M | – | – |
Q4 2026 and full year 2026 outlook
- RevenueQ4 2026: $240 million to $250 million; full year 2026: $1.04 billion to $1.1 billion
- NoteQ4 2026 Adjusted EBITDA: $43 million to $45 million
- NoteFull year 2026 Adjusted EBITDA: $253 million to $255 million
- NoteFull year 2026 capital expenditures: approximately $172 million to $177 million
- NoteNo GAAP net income outlook and no Adjusted EBITDA to GAAP net income reconciliation outlook provided; company cites uncertainty over reconciling items such as stock-based compensation, acquisition related expense and unrealized foreign exchange gains or losses
Capital returns
- No share repurchase or dividend line appears in the filing.
- Proceeds from IPO, net of underwriting commissions: $155,305 thousand in Q3 2026 and in the nine months ended September 30, 2026 (financing cash flow, not a capital return).
What drove it
- Company states that LimePrime subscription growth is serving as a powerful driver of rider loyalty and engagement (CEO).
- Company states that the average LimePrime rider took 8 times as many trips as the average Pay-As-You-Go rider.
- Company states that the average LimePrime rider is now generating two times the adjusted gross profit per non-subscription rider (CFO).
- Company states that trailing twelve-month revenue exceeded $1 billion for the first time for the twelve months ended September 30, 2026.
- Average Operational Fleet grew 26% year-over-year to 447,184 vehicles, as printed in the highlights.
Concerns
- CEO states that targeted market investments and LimePrime's growth may temporarily affect near-term margins.
- GAAP gross margin fell to 44.6% from 47.3% in Q3, and Adjusted Gross Margin fell to 54.1% from 57.6%.
- Operating profit fell to $64,523 thousand from $68,903 thousand, while total operating expenses rose to $96,429 thousand from $73,714 thousand. R&D rose to $21,662 thousand from $13,628 thousand.
- Free Cash Flow fell to $90,582 thousand from $98,775 thousand in Q3. Nine-month Free Cash Flow was $7,257 thousand vs $78,892 thousand, driven by capital expenditures of $(156,594) thousand vs $(100,237) thousand as printed.
- Q3 net income of $43,709 thousand benefited from a tax line of $24,436 thousand expense in Q3, but the nine-month line is a benefit of $(272,141) thousand. The filing states that the Adjusted EBITDA reconciliation tax line includes a discrete tax benefit from release of the valuation allowance on U.S. federal and state deferred tax assets.
- Other income (expense), net swung to $4,278 thousand in Q3 from $(31,160) thousand, and includes changes in fair value of the 2021 Notes and foreign exchange items according to the company's definition of Adjusted EBITDA.
- Company has not provided GAAP net income guidance or an Adjusted EBITDA to GAAP reconciliation outlook, citing variability in reconciling items.
- Full year 2026 Adjusted EBITDA guidance of $253 million to $255 million, compared with nine-month Adjusted EBITDA of $210,115 thousand as printed, implies a Q4 range set by the company; the company has not restated any prior range because no prior outlook was provided.
What to watch
- Q4 2026 revenue guidance of $240 million to $250 million and Adjusted EBITDA guidance of $43 million to $45 million, against Q3 2026 revenue of $360,628 thousand and Adjusted EBITDA of $118,437 thousand as printed.
- Full year 2026 revenue guidance of $1.04 billion to $1.1 billion and capital expenditures of approximately $172 million to $177 million.
- Whether Adjusted EBITDA margin and Adjusted Gross Margin recover from 32.8% and 54.1% respectively, as management says near-term margins may be temporarily affected.
- LimePrime engagement and retention trends, as described by the CFO.
- Stock-based compensation trajectory: $15,721 thousand in Q3 2026 vs $2,673 thousand in Q3 2025.
- Free Cash Flow conversion, given nine-month Free Cash Flow of $7,257 thousand.
- Form 10-Q for the quarter ended September 30, 2026, referenced in the release as forthcoming, for GAAP reconciling items and risk factors.
Balance sheet and cash flow
- Cash and cash equivalents: $417,746 thousand as of September 30, 2026 vs $339,825 thousand as of December 31, 2025.
- Total assets: $1,261,480 thousand as of September 30, 2026 vs $794,287 thousand as of December 31, 2025.
- Total stockholders' equity (deficit): $988,330 thousand as of September 30, 2026 vs $(521,380) thousand as of December 31, 2025.
- Total liabilities: $273,150 thousand as of September 30, 2026 vs $1,201,640 thousand as of December 31, 2025.
- Term loan, current: nil as of September 30, 2026 vs $113,866 thousand as of December 31, 2025.
- 2021 Notes, current: nil as of September 30, 2026 vs $660,324 thousand as of December 31, 2025.
- 2020 Notes (non-current): nil as of September 30, 2026 vs $207,885 thousand as of December 31, 2025.
- Convertible preferred stock: nil as of September 30, 2026 vs $114,027 thousand as of December 31, 2025.
- Deferred tax assets: $293,054 thousand as of September 30, 2026 vs $8,623 thousand as of December 31, 2025.
- Nine-month financing cash flow includes principal repayment on term loans of $(115,000) thousand, which is the same amount printed for the Q3 2026 column.
- Nine-month net cash used in investing activities: $(163,892) thousand vs $(100,237) thousand. Purchases of vehicle assets nine months: $(142,095) thousand vs $(90,532) thousand.
- Stock-based compensation: $15,721 thousand in Q3 2026 vs $2,673 thousand; $56,442 thousand in nine months 2026 vs $8,794 thousand.
- Cash, cash equivalents and restricted cash, end of period: $453,183 thousand as of September 30, 2026 vs $392,827 thousand as of September 30, 2025.
Analysis
Lime reported third quarter 2026 revenue of $360,628 thousand, up 20% year-over-year from $301,571 thousand, and GAAP net income of $43,709 thousand, up 41% from $30,900 thousand. The release also states that trailing twelve-month revenue exceeded $1 billion for the first time. Average Operational Fleet reached 447,184 vehicles, up 26% year-over-year, as printed in the highlights. The filing does not break revenue into segments or geographies, so the read on demand rests on total revenue and the fleet figure.
Margins moved the other way. GAAP gross margin was 44.6% against 47.3% a year earlier, and Adjusted Gross Margin was 54.1% against 57.6%. Cost of revenue rose to $199,676 thousand from $158,954 thousand. Total operating expenses rose to $96,429 thousand from $73,714 thousand, with research and development at $21,662 thousand against $13,628 thousand and selling, general and administrative at $59,228 thousand against $46,575 thousand. GAAP operating profit fell to $64,523 thousand from $68,903 thousand. Adjusted EBITDA rose to $118,437 thousand from $106,686 thousand, but its margin fell to 32.8% from 35.4%. The CEO states that targeted market investments and LimePrime growth may temporarily affect near-term margins.
The quarter's net income is shaped by non-operating and tax lines. Other income (expense), net was $4,278 thousand against $(31,160) thousand, and the provision for income taxes was $24,436 thousand against $1,656 thousand. The filing describes the Adjusted EBITDA tax line as including a discrete tax benefit from release of the valuation allowance on U.S. federal and state deferred tax assets, and the nine-month tax line is a benefit of $(272,141) thousand. Nine-month GAAP net income of $277,802 thousand therefore differs sharply from operating profit of $48,301 thousand. Diluted EPS was $0.63 in Q3 against $1.01, and nine-month diluted EPS was $5.52 against $(0.48).
Cash generation weakened. Q3 operating cash flow was $114,560 thousand, against $112,477 thousand, but Free Cash Flow was $90,582 thousand against $98,775 thousand, as capital expenditures in the reconciliation were $(23,978) thousand against $(13,702) thousand. Nine-month Free Cash Flow was $7,257 thousand against $78,892 thousand, with capital expenditures of $(156,594) thousand against $(100,237) thousand. The balance sheet shows cash and cash equivalents of $417,746 thousand, total assets of $1,261,480 thousand and stockholders' equity of $988,330 thousand, up from a deficit of $(521,380) thousand at December 31, 2025. The filing shows the $115,000 thousand term loan principal repayment and the disappearance of the 2020 and 2021 Notes and convertible preferred stock lines, with $155,305 thousand of IPO proceeds in Q3. No share repurchases or dividends appear.
Full year 2026 guidance calls for revenue of $1.04 billion to $1.1 billion and Adjusted EBITDA of $253 million to $255 million, with capital expenditures of approximately $172 million to $177 million. Q4 2026 guidance is revenue of $240 million to $250 million and Adjusted EBITDA of $43 million to $45 million. The company did not provide a GAAP net income outlook. No prior outlook was supplied with this filing, so no guidance comparison is made. The items deserving attention are the Q4 range against the Q3 printed figures, the gross margin and Adjusted EBITDA margin trends, and the nine-month free cash flow figure.
Management, verbatim
Q3 was a landmark quarter for Lime, as we crossed $1 billion in trailing twelve-month revenue for the first time,
Wayne Ting, CEO
While our targeted market investments and LimePrime's growth may temporarily affect near-term margins, we believe they also help secure our local market leadership.
Wayne Ting, CEO
We are particularly encouraged by the early trends in LimePrime engagement and retention
Ann Gugino, CFO
Not in the filing
stated, not guessed- Prior-year and prior-quarter values for gross margin change in basis points, Adjusted EBITDA percentage change and Adjusted Gross Profit percentage change were not printed.
- Year-over-year percentage change for Adjusted EBITDA, Adjusted Gross Profit and Free Cash Flow was not printed.
- Prior-year Average Operational Fleet figure was not printed; only the 26% change is printed.
- Sequential (quarter-over-quarter) comparisons were not printed.
- No segment, geography, product line or LimePrime subscriber revenue breakdown was printed.
- Revenue per Vehicle per Day and Monthly Active Users values were not printed (definitions only).
- No prior outlook was provided, so no guidance comparison is made.
- GAAP net income outlook and Adjusted EBITDA to GAAP reconciliation outlook were not provided by the company.
- Guidance for gross margin, operating expenses and tax rate was not provided.
- No share repurchase, dividend or other capital return figures were printed.
- Nine-month year-over-year percentage changes were not printed.
- Net income margin for nine months was not printed.
- Share price reaction and analyst consensus estimates are not in the documents.
- Interim cash flow line detail for vehicle and non-vehicle purchases in the free cash flow reconciliation differs from the cash flow statement; the reconciliation figure is used as printed and no reconciling difference is calculated.
Written by an AI language model from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure is checked against the filing text, and a metric the filing does not print, or whose value, prior period and change do not add up, is dropped from the metrics. The model can still misread a table, in the metrics or in the text, so check a number in the filing before you rely on it. Consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.