Company Performance - Upstart Holdings, Inc. reported quarterly earnings of $0.36 per share, exceeding the Zacks Consensus Estimate of $0.27 per share, and compared to a loss of $0.17 per share a year ago, representing an earnings surprise of +33.33% [1] - The company posted revenues of $257.29 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 14.20%, and showing a significant increase from year-ago revenues of $127.63 million [2] - Over the last four quarters, Upstart has consistently surpassed consensus EPS estimates and revenue estimates [2] Stock Performance - Upstart shares have increased approximately 34.5% since the beginning of the year, significantly outperforming the S&P 500's gain of 7.6% [3] - The current consensus EPS estimate for the upcoming quarter is $0.43 on revenues of $266.18 million, and for the current fiscal year, it is $1.56 on revenues of $945.68 million [7] Industry Outlook - The Financial - Miscellaneous Services industry, to which Upstart belongs, is currently ranked in the top 26% of over 250 Zacks industries, indicating a favorable outlook [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact stock performance [5]

Financial Data and Key Metrics Changes - Total revenue for Q2 was approximately $257 million, up 102% year-on-year, including fee revenue of approximately $241 million, which was up 84% year-on-year [28][30] - GAAP net income for Q2 was approximately positive $6 million, ahead of expectations, marking a return to profitability a quarter earlier than anticipated [31] - Adjusted EBITDA was $53 million, reflecting strong operating leverage [31] - Average loan size was approximately $7,570, which was 15% lower than the prior quarter due to model advancements driving higher approval rates for smaller loan amounts [29] Business Line Data and Key Metrics Changes - Originations on the Upstart platform in Q2 reached $2.8 billion, the highest volume in three years [9] - The auto business grew 87% sequentially, while the home business grew 67% sequentially [9] - More than 10% of originations came from newer businesses, including small dollar loans, which grew 40% sequentially [9][12] Market Data and Key Metrics Changes - The Upstart Macro Index has been largely stable for several months, indicating no significant macro improvements or Fed rate decreases impacting growth [10] - The volume of loan transactions across the platform was approximately 373,000, up 159% from the prior year [29] Company Strategy and Development Direction - The company aims for market share leadership in home and auto lending, with significant investments in these areas expected to yield fast growth and strong credit performance [17] - The strategy includes transitioning most funding for newer products off the balance sheet by 2025 [12][33] - The company is focused on creating a differentiated experience in home and auto lending, leveraging AI to reduce origination costs and improve consumer experience [72] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ongoing growth of the core personal loan business, despite the scaling of new products [27] - The macro environment is expected to remain steady, with no significant changes anticipated in interest rates or labor market conditions [34] - The company plans to continue launching model enhancements to improve conversion rates and maintain robust take rates and contribution margins [34] Other Important Information - The company has made significant advancements in AI technology, with Model 22 improving separation accuracy by 17 percentage points [18] - Year-over-year population-adjusted delinquency rates are down 20%, and raw delinquency rates are down 32% due to servicing optimizations [20] Q&A Session Summary Question: Discussion on ABS market and competitive pressure - Management noted that the ABS market is constructive, but the equity tranche market is opportunistic with buyers picking and choosing deals [39] - Increased competition is expected as funding markets improve, but the company remains focused on maintaining strong offers and growing market share [40] Question: Transition to external funding and balance sheet impact - Management indicated a timeline for transitioning to external funding between now and the end of the year, with expectations for the balance sheet to start releasing as new flows are secured [44] Question: Contribution margin improvement - The contribution margin improved due to a mix benefit from more core borrower segment loans and improved take rates driven by model enhancements [52] Question: Macro assumptions and guidance - Management expects a steady macro environment with no significant changes in interest rates or default rates, planning conservatively for the remainder of the year [55] Question: Average loan size and strategic shifts - The decrease in average loan size is strategic, reflecting rapid growth in the small dollar product, which is intended to increase the number of users on the platform [67] Question: Funding partners for new products - The company plans to secure a combination of bank and credit union partners for home and auto products, leveraging their familiarity with these offerings [77] Question: Conversion rate improvement and Walmart partnership - Management did not provide specific forecasts for conversion rates but noted that the Walmart partnership continues to be successful [82]

Q2 2025 earnings August 5, 2025 Forward looking statements This presentation contains "forward-looking" statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including but not limited to, information or predictions concerning our future financial performance, including our financial outlook for Q3 2025 and the full fiscal year 2025 under the heading "Outlook" and management's estimates under the heading "Ma ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 _________________________ FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from_________to ________ Commission File Number: 001-39797 Upstart Holdings, Inc. (Exact name of registrant as specified in its charter) _ ...

Financial Performance - Total revenue for Q2 2025 reached $257 million, reflecting a 102% year-over-year growth, with revenue from fees at $241 million, up 84% year-over-year[5] - GAAP net income for Q2 2025 was $5.6 million, an improvement from a loss of $54.5 million in Q2 2024[5] - Adjusted EBITDA for Q2 2025 was $53.1 million, compared to a loss of $9.3 million in Q2 2024, resulting in an adjusted EBITDA margin of 21%[5] - Contribution profit for Q2 2025 was $141 million, an 85% increase year-over-year, maintaining a contribution margin of 58%[5] - For the full year 2025, Upstart expects total revenue of approximately $1.055 billion, with revenue from fees around $990 million and net interest income of approximately $65 million[5] - Total revenue for Q2 2025 was $257.3 million, a 101% increase from $127.6 million in Q2 2024[39] - Net income for Q2 2025 was $5.6 million, compared to a net loss of $54.5 million in Q2 2024, marking a significant turnaround[39] - Adjusted EBITDA for Q2 2025 was $53.1 million, with an adjusted EBITDA margin of 21%, compared to an adjusted EBITDA loss of $9.3 million in Q2 2024[39] - Contribution profit for Q2 2025 was $140.5 million, maintaining a contribution margin of 58%[35] - Adjusted net income for Q2 2025 was $42.2 million, compared to an adjusted net loss of $15.3 million in Q2 2024[42] - Basic net income per share for Q2 2025 was $0.06, a recovery from a loss of $0.62 per share in Q2 2024[42] - The operating margin improved to 2% in Q2 2025, compared to a negative 43% in Q2 2024[39] Loan Performance - Upstart originated 372,599 loans in Q2 2025, a 159% increase year-over-year, with a conversion rate of 23.9%, up from 15.2% in Q2 2024[5] - The conversion rate for loans processed was 15.2% for the three months ended June 30, 2024[32] - Transaction volume for the three months ended June 30, 2024, was $1,109,732,000, with 143,900 loans processed[32] - Upstart's platform continues to automate over 90% of loans, enhancing efficiency and customer experience[7] Assets and Cash Flow - Upstart's cash and cash equivalents decreased from $788.4 million at the end of 2024 to $395.9 million by June 30, 2025[20] - Total assets increased from $2.37 billion at the end of 2024 to $2.48 billion by June 30, 2025[20] - Cash, cash equivalents, and restricted cash at the end of the period were $560,618,000 for the six months ended June 30, 2024[30] Operational Costs - Borrower acquisition costs for Q2 2025 were $60.9 million, up from $23.2 million in Q2 2024[35] - Customer operations costs for Q2 2025 were $39.3 million, an increase from $31.2 million in Q2 2024[36] - Operating expenses for the three months ended June 30, 2024, totaled $183,116,000, leading to a loss from operations of $(55,486,000)[23] Profitability and Growth Indicators - The company achieved GAAP profitability a quarter earlier than expected, indicating a strong recovery and growth trajectory[3]

Group 1 - The article discusses the integration of artificial intelligence in the lending industry as consumer debt reaches all-time highs [1] - Upstart Holdings, Inc. is highlighted as an AI-driven lending platform that offers personal loans, auto loans, and home equity lines [1]

Core Insights - The article discusses the current market trends and potential investment opportunities within specific sectors, highlighting the importance of thorough analysis before making investment decisions [1][2]. Group 1: Market Trends - Recent market fluctuations have shown a significant impact on investor sentiment, with a notable increase in volatility observed in the tech sector [1]. - Analysts are focusing on the recovery patterns of various industries post-pandemic, particularly in consumer discretionary and travel sectors, which are showing signs of rebound [1]. Group 2: Investment Opportunities - There are emerging opportunities in renewable energy companies, driven by increased government incentives and consumer demand for sustainable solutions [1]. - The healthcare sector is also highlighted as a potential area for growth, especially companies involved in biotechnology and telehealth services, which have gained traction during the pandemic [1]. Group 3: Risks and Considerations - Investors are advised to remain cautious of potential regulatory changes that could impact certain industries, particularly in technology and finance [1]. - The article emphasizes the need for continuous monitoring of economic indicators that could affect market stability and investment returns [1].

Group 1 - Upstart is expected to report its Q2 2025 earnings on Tuesday after hours, which is highly anticipated by investors [1] - The core thesis revolves around Upstart's ability to attract outside investors to take on its balance sheet loans [1] Group 2 - The marketplace highlights a portfolio of undervalued investment opportunities, focusing on stocks with rapid growth potential and strong management [2] - The emphasis is on selecting the most attractive investments, with a commitment to thorough analysis and stock picking [2] Group 3 - The platform aims to simplify investing by showcasing stocks that deliver strong gains, contributing to the growth of savings [3] - Deep Value Returns' Marketplace is noted for its rapid growth and high-quality, actionable stock picks [3]

Core Insights - Upstart is an innovator in the financial services industry with an AI-powered lending platform that enhances creditworthiness assessment, leading to increased approval rates and controlled default risks [1] - The stock has shown significant volatility but has started to regain investor confidence, with a notable increase in value over the past three years [2][4] Performance Overview - Since July 31, 2022, Upstart's stock has surged by 250%, transforming a $1,000 investment into $3,500, despite currently trading 78% below its peak established in October 2021 [4] - The company has demonstrated meaningful financial improvements, with a 102% year-over-year increase in transaction volume and a 67% revenue gain in Q1 2025 [5] Market Valuation - Upstart shares are currently trading at a price-to-sales ratio of 10.9, indicating growing market optimism, but this high valuation introduces potential downside risk if the company fails to meet earnings expectations [7]

Core Viewpoint - Upstart Holdings, Inc. is expected to show significant growth in its upcoming earnings report, with a notable increase in both earnings per share (EPS) and revenue compared to the previous year [2][3]. Group 1: Recent Performance - Upstart Holdings, Inc. closed at $79.22, down 3.08% from the previous trading session, underperforming the S&P 500's loss of 1.6% [1] - Over the past month, the company's shares have appreciated by 10.73%, outperforming the Finance sector's gain of 0.8% and the S&P 500's gain of 2.25% [1]. Group 2: Upcoming Earnings Expectations - The earnings report is scheduled for August 5, 2025, with an expected EPS of $0.27, reflecting a 258.82% increase from the prior-year quarter [2]. - Revenue is forecasted to be $225.3 million, indicating a 76.52% growth compared to the same quarter of the previous year [2]. Group 3: Fiscal Year Projections - For the entire fiscal year, earnings are projected at $1.58 per share, representing an increase of 890% from the prior year [3]. - Revenue for the fiscal year is estimated at $1.02 billion, showing a growth of 59.46% compared to the previous year [3]. Group 4: Analyst Estimates and Market Sentiment - Recent changes to analyst estimates indicate a positive outlook for Upstart Holdings, reflecting analysts' confidence in the company's performance and profit potential [3]. - The Zacks Consensus EPS estimate has remained stagnant over the past month, and the company currently holds a Zacks Rank of 3 (Hold) [5]. Group 5: Valuation Metrics - Upstart Holdings, Inc. is currently traded at a Forward P/E ratio of 51.8, which is a premium compared to the industry average Forward P/E of 12.03 [6]. - The Financial - Miscellaneous Services industry, to which Upstart belongs, has a Zacks Industry Rank of 70, placing it in the top 29% of over 250 industries [6].