Core Viewpoint - Upstart's stock price target has been raised from $50 to $70 by Morgan Stanley, maintaining a "neutral" rating, driven by loan recovery, pricing optimization, and new product diversification [1] Group 1: Financial Performance - Upstart's total loan facilitation reached approximately $2.82 billion, representing a year-over-year increase of about 154% and a quarter-over-quarter increase of about 32% [1] - The company achieved its first net profit since Q1 2022, indicating a return to profitability due to pricing optimization and improved business mix [1] - Morgan Stanley has revised its earnings per share (EPS) forecast for Upstart from $2.41 to $3.06 for 2026, reflecting confidence in the company's growth prospects [1] Group 2: Product Diversification - Upstart is actively expanding into verticals beyond personal credit loans, with new products like small loans, auto loans, and housing loans contributing over 10% to quarterly loan volume [2][3] - The management estimates the core market size to be between $8 billion and $12 billion, providing new growth opportunities through a broader product mix [3] Group 3: Pricing and Profitability - The average take rate has remained strong due to adjustments in borrower structure and pricing strategies, allowing for higher fees from a more diverse borrower base [4] - The reduction in the proportion of super-prime borrowers from 29% to 26% indicates a shift towards serving more medium-credit customers, enhancing revenue potential [4] Group 4: Market Sensitivity - Upstart's business performance is highly sensitive to macroeconomic conditions and credit cycles, with potential risks arising from economic downturns affecting borrower repayment capabilities [4][5] - The company faces challenges if inflation pressures lead to rising interest rates, which could dampen demand for consumer loans and increase funding costs [5][6] Group 5: Valuation Considerations - Despite improvements in fundamentals, Morgan Stanley maintains a cautious stance due to Upstart's high valuation, which reflects optimistic growth expectations from investors [3][6] - The current stock price suggests a balanced risk-reward scenario, with potential for volatility if future growth or profitability does not meet elevated market expectations [6]

Welcome back. Upstart, an AI powered lending platform sliding this morning, down 13 and a half% despite beating on top and bottom lines. The company partners with banks and credit unions to provide credit products and automate loans.This is banks look to further integrate AI into their business models. Joining us now, Upstart CEO Dave Gerard. Dave, uh, what do you what do you make of the stock reaction to, you know, what on the surface feels like pretty good earnings this morning.>> Uh, yeah, Lesie. Look, I ...

Core Insights - Upstart Holdings experienced significant growth in loan originations and revenues, with a 102% year-on-year revenue increase in Q2 and loan originations rising by 159% to over 372,590 [3][4] - Despite strong performance, Upstart's shares fell by 7% in after-market trading, indicating market concerns despite positive financial results [1] Financial Performance - Revenues surged to $2.6 billion, with personal loan originations increasing by 143% [3] - The company expects to achieve $1 billion in revenues for the current quarter, aligning with Wall Street consensus [4] Business Segments Growth - Auto loans saw a dramatic increase, with over 4,600 loans originated in Q2, up more than 6 times year-on-year, contributing $114 million in volume [4] - Home loans increased by 9 times year-on-year to $68 million in originations [4] - Newer business lines, including small dollar loans, attracted nearly 20% of new borrowers, with small dollar loan originations growing 40% sequentially [5] Risk Modeling and AI Enhancements - The company attributed its growth to AI-driven enhancements in risk modeling, which improved conversion rates from 19% in Q1 to 24% in Q2 [6] - Year-over-year population-adjusted delinquency rates decreased by 20%, and raw delinquency rates fell by 32% [8] Funding and Market Outlook - Upstart anticipates reaching a new all-time high for monthly available funding in Q3, indicating a robust funding pipeline [7] - The competitive landscape is intensifying, with improved funding conditions attracting more competitors [10] Consumer Behavior Insights - The CFO noted that the American consumer is likely overspending relative to income levels, which could impact future credit trends [10]

Upstart Holdings, Inc. (UPST) came out with quarterly earnings of $0.36 per share, beating the Zacks Consensus Estimate of $0.27 per share. This compares to a loss of $0.17 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of +33.33%. A quarter ago, it was expected that this company would post earnings of $0.19 per share when it actually produced earnings of $0.3, delivering a surprise of +57.89%.Over the last four quarters, the co ...

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) _ ...

Exhibit 99.1 Upstart Announces Results for Second Quarter 2025 SAN MATEO, Calif. – August 5, 2025 – Upstart Holdings, Inc. (NASDAQ: UPST), the leading artificial intelligence (AI) lending marketplace, today announced financial results for the quarter ended June 30, 2025. Upstart will host a conference call and webcast at 1:30 p.m. Pacific Time today. An earnings presentation and link to the webcast are available at ir.upstart.com. "A year ago, you saw the first signs that Upstart was returning to growth mod ...

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]

Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or a ...