Financial Performance - In Q3 2025, Upstart reported a 80% year-on-year growth in originations, totaling approximately $2.9 billion[3]. - Total revenue for Q3 2025 was $277 million, reflecting a 71% increase year-on-year, with revenue from fees at $259 million, up 54% year-on-year[6]. - GAAP net income for Q3 2025 was $31.8 million, an improvement from a loss of $6.8 million in Q3 2024, resulting in diluted net income per share of $0.23[6]. - Contribution profit reached $147 million, up 44% year-on-year, with a contribution margin of 57%[6]. - Adjusted EBITDA for Q3 2025 was $71.2 million, significantly up from $1.4 million in Q3 2024, with an adjusted EBITDA margin of 26%[6]. - Total revenue for the nine months ended September 30, 2025, was $747,767, compared to $417,564 in the same period of 2024, marking an increase of 79%[40]. - Adjusted net income for Q3 2025 was $59,963, a significant turnaround from a loss of $5,325 in Q3 2024[43]. - The company reported a net income of $31,805 for Q3 2025, a significant improvement from a net loss of $6,758 in Q3 2024, highlighting a positive trend in profitability[40]. Operational Metrics - Upstart expects to originate approximately 428,056 loans in Q4 2025, representing a 128% year-over-year increase[6]. - The conversion rate improved to 20.6% in Q3 2025, up from 16.3% in Q3 2024[6]. - The number of loans processed increased to 428,056 in Q3 2025, up from 188,149 in Q3 2024, indicating a growth of 127%[32]. - The percentage of loans fully automated remained stable at 91% across both Q3 2024 and Q3 2025, reflecting consistent operational capabilities[32]. - Borrower acquisition costs for the nine months ended September 30, 2025, totaled $176.8 million, compared to $80.8 million in the same period of 2024, indicating increased investment in customer acquisition[36]. Balance Sheet - Total assets increased to approximately $2.9 billion as of September 30, 2025, compared to $2.37 billion at the end of 2024[20]. - The company’s total liabilities rose to approximately $2.16 billion as of September 30, 2025, up from $1.73 billion at the end of 2024[20]. - Upstart's cash and cash equivalents decreased to $489.8 million as of September 30, 2025, down from $788.4 million at the end of 2024[20]. - Cash, cash equivalents, and restricted cash at the end of the period for September 30, 2024, were $655,767, compared to $836,905 for the same period in 2025, indicating a decrease of 21.6%[30]. Year-over-Year Comparisons - Total revenue for the three months ended September 30, 2024, was $162,140, a decrease from $277,105 in the same period of 2025, representing a decline of 41.4%[23]. - Net income for the three months ended September 30, 2024, was a loss of $6,758, compared to a net income of $31,805 for the same period in 2025, indicating a significant turnaround[23]. - Revenue from fees, net for the nine months ended September 30, 2024, was $436,190, while for the same period in 2025, it increased to $684,791, reflecting a growth of 56.9%[23]. - Operating expenses for the three months ended September 30, 2024, totaled $207,292, compared to $253,439 in the same period of 2025, showing a decrease of 18.2%[23]. - The company experienced a gain on debt extinguishment of $33,361 for the three months ended September 30, 2024, compared to $7,246 in the same period of 2025[23]. - The total fair value and other adjustments, net for the three months ended September 30, 2024, were $(35,477), while for the same period in 2025, it was $(29,843), indicating an improvement[25]. Transaction Volume - Transaction volume for the three months ended September 30, 2025, reached $2,854,296, representing a significant increase from $1,582,317 in the same period of 2024[32].

Core Insights - Upstart Holdings (UPST) is expected to report its third-quarter 2025 results on November 4, with management guiding revenues of $280 million and adjusted net income of approximately $44 million [1][6] - The Zacks Consensus Estimate for quarterly revenues is $281.02 million, reflecting a 73.3% increase year-over-year, while the consensus for earnings is 42 cents per share, a significant rise from a loss of 6 cents in the previous year [1][9] Financial Projections - For the full year 2025, management projects revenues of $1.055 billion and GAAP net income of approximately $35 million [2] - The Zacks Consensus Estimate for UPST's full-year revenues is $963.4 million, indicating a 51.36% year-over-year increase, with an EPS consensus of $1.66, up from a loss of 20 cents per share in the prior year [2] Earnings Surprise History - Upstart has a strong earnings surprise history, having outperformed the Zacks Consensus Estimate in each of the last four quarters, with an average beat of 192.09% [3] Earnings Prediction Model - The proprietary model does not predict an earnings beat for Upstart this time, as it has an Earnings ESP of 0.00% and a Zacks Rank 3 (Hold) [4][5] Revenue and Profitability Drivers - Management expects Q3 revenues of $280 million, with fee-based income contributing approximately $275 million and net interest income around $5 million [8][11] - The new underwriting model, Model 22, has improved conversion rates and is expected to sustain revenue growth, while tighter cost controls are anticipated to maintain a solid contribution margin [10] Market Performance and Valuation - Upstart's shares have declined 8.6% over the past six months, underperforming peers like LendingClub and SoFi, which have seen significant gains [12] - The stock is currently considered overvalued, with a Price/Sales ratio of 3.70X, above the industry average of 3.28X [13] Competitive Position and Growth Outlook - Upstart is making progress with revenue recovery and profitability, expanding into new lending verticals, and attracting new lending partners [17] - However, exposure to credit-sensitive borrowers and market liquidity challenges may create volatility in growth [18]

Institutional Investment Activity - Ameritas Advisory Services LLC acquired a new position in Upstart worth approximately $34,000 during the 2nd quarter [1] - GAMMA Investing LLC increased its position by 23.3% in the 1st quarter, now owning 1,662 shares valued at $77,000 after purchasing an additional 314 shares [1] - Bogart Wealth LLC grew its position by 140.0% in the 2nd quarter, now holding 1,200 shares worth $78,000 after acquiring 700 shares [1] - PNC Financial Services Group Inc. increased its position by 385.1% in the 1st quarter, now owning 1,950 shares valued at $90,000 after buying 1,548 shares [1] - NewEdge Advisors LLC lifted its holdings by 20.0% in the 1st quarter, now owning 1,997 shares worth $92,000 after acquiring 333 shares [1] - Institutional investors and hedge funds collectively own 63.01% of Upstart's stock [1] Analyst Ratings and Price Targets - Bank of America reduced its price target from $88.00 to $87.00, maintaining a "neutral" rating [2] - JPMorgan Chase & Co. upgraded its rating from "neutral" to "overweight," lowering the price target from $93.00 to $88.00 [2] - Goldman Sachs cut its price target from $78.00 to $54.00, assigning a "sell" rating [2] - Piper Sandler set a price target of $80.00 [2] - Morgan Stanley reaffirmed an "equal weight" rating [2] - The consensus rating for Upstart is "Hold" with a target price of $78.83 [2] Insider Trading Activity - CFO Sanjay Datta sold 13,473 shares at an average price of $61.12, totaling $823,469.76, reducing his ownership by 4.33% [3] - Director Kerry Whorton Cooper sold 500 shares at an average price of $69.21, totaling $34,605.00, representing a 1.93% decrease in ownership [3] - Insiders have sold 106,214 shares worth $6,803,558 over the last 90 days, with insiders owning 16.67% of the company's stock [3] Financial Performance - Upstart reported $0.36 EPS for the last quarter, exceeding the consensus estimate of $0.27 by $0.09 [5] - Revenue for the quarter was $257.29 million, surpassing the consensus estimate of $225.35 million, reflecting a year-over-year increase of 101.6% [5] - The company had a negative net margin of 0.75% and a negative return on equity of 5.95% [5] - Upstart's FY 2025 guidance includes EPS expectations, with analysts forecasting -0.03 EPS for the current year [5] Stock Performance and Market Metrics - Upstart shares opened at $47.52, with a market cap of $4.57 billion and a price-to-earnings ratio of -594.00 [4] - The stock has a beta of 2.27, indicating higher volatility compared to the market [4] - The 50-day simple moving average is $58.50, and the 200-day simple moving average is $59.96 [4] - The stock has experienced a one-year low of $31.40 and a one-year high of $96.43 [4]

Company Overview - Upstart is a small-cap fintech company with a current market cap of approximately $4.5 billion, significantly below its all-time high by about 88% [2][3] - The company is projected to achieve its first billion-dollar revenue year in 2025, indicating strong growth momentum [1] Financial Performance - Upstart reported an origination volume of $2.8 billion, reflecting a 154% year-over-year increase [7] - Revenue reached $257 million, more than double the amount from the previous year [7] - The company achieved a 21% adjusted EBITDA margin and GAAP profitability for the first time in years [7] Market Potential - The U.S. personal loan market exceeds $100 billion annually, with Upstart's predictive methods for loan defaults proving more effective than traditional approaches [4] - Upstart's newer verticals, including auto loans and home loans, are experiencing significant growth, with auto loan originations increasing sixfold and home loan originations growing 67% sequentially [5] - The potential for home equity loans is substantial, given that U.S. homeowners currently hold $35 trillion in home equity, presenting a significant opportunity as interest rates decline [5] Competitive Landscape - Upstart is positioned to potentially surpass Affirm, a leader in the buy now, pay later (BNPL) space, which has a market cap of $23.5 billion, approximately five times that of Upstart [2][3] - Despite Affirm's strong performance and effective leadership, Upstart's growth opportunities in a challenging lending environment are encouraging [3]

Core Viewpoint - Puma is undergoing significant restructuring, including cutting 900 corporate jobs by the end of 2026, to address declining sales and regain market share in the competitive sportswear industry [2][3][5] Group 1: Restructuring and Job Cuts - The company has expanded its cost-reduction program, which initially eliminated 500 positions earlier this year, to a total of 900 job cuts [2] - Chief Executive Arne Hoeld is tasked with restoring momentum to Puma, which has seen its market share erode due to competition from niche brands [3] - The restructuring aims to streamline operations, restore profitability, and refocus on higher-margin channels [5] Group 2: Sales Performance and Market Challenges - Puma's sales have declined, particularly in the U.S., where it faces challenges maintaining shelf space amid heavy discounting and cautious retailer ordering [4] - The company warned of an annual loss for 2025, marking its first loss in over a decade, with stock values falling by more than half in 2025 [5] - Revenue for the three months ending September decreased by 10.4% to $2.13 billion, slightly below market expectations [7] Group 3: Inventory and E-commerce Strategy - Inventories rose 17.3% year-on-year to approximately $2.3 billion in the third quarter, with expectations to normalize by the end of 2026 [6] - The company has reduced promotional activities in its e-commerce and retail operations to protect pricing integrity [6] - Puma is shifting its retail strategy towards direct sales and enhancing its e-commerce infrastructure [9] Group 4: Future Outlook and Strategic Focus - Management anticipates returning to top-line growth by 2027 after completing the restructuring and realigning distribution channels [7] - Hoeld emphasizes simplifying the organizational structure and sharpening product strategy to reinforce Puma's relevance in key categories [11] - The company is prioritizing long-term brand investments over short-term sales, with new initiatives expected in 2026 and 2027 [13]

Core Insights - A growing number of credit unions are adopting Upstart Holdings' AI platform to modernize their lending operations, indicating increased confidence in Upstart's technology from community lenders [1][2] Company Performance - Upstart reported revenues of approximately $257 million in Q2 2025, more than double the previous year, with loan originations reaching about $2.8 billion, the highest in three years [3] - The company returned to GAAP profitability with a net income of $5.6 million, and contribution profit increased to $141 million, reflecting margin improvement and higher conversion rates [3] - Upstart's auto lending business grew more than sixfold in the past year, while its home segment grew nearly ninefold, now accounting for over 10% of total volume [4] Technological Advancements - Upstart's AI model "Model 22" improved risk-separation accuracy by 17 percentage points compared to traditional credit models, with 92% of loans in Q2 2025 being fully automated [4] Market Context - Despite strong performance metrics, Upstart's stock has faced challenges due to concerns over softer credit conditions and turbulence in the used-car lending market [5] - The bankruptcy of a subprime auto lender has raised questions about downstream credit risk, highlighting the sensitivity of Upstart's model to shifting credit-cycle dynamics [5] Peer Comparison - LendingClub Corporation reported a 37% year-over-year increase in loan originations to $2.6 billion and a 32% increase in total revenues to $266.2 million in Q3 2025 [6] - SoFi Technologies reported record net revenues of $961.6 million, up 38% year over year, with significant growth in members and products [7] Valuation Insights - Upstart shares are currently considered overvalued, trading at a forward Price/Sales ratio of 3.81X, above the industry average of 3.40X [10] - The Zacks Consensus Estimate for full-year 2025 and 2026 EPS has been revised marginally upward, indicating significant year-over-year increases [11]

Upstart Holdings (NASDAQ: UPST ) is an AI-driven lending platform that partners with banks, credit unions, and capital providers to create a faster loan process while approving more borrowers at similar default rates compared to traditional underwriting models. In summary, theInevitable Investor is a private investor and speculator with 13 years of investing experience. An accountant by training, my investing style leans towards quality-orientation, rather than a pure growth investing, or value investing ap ...

Core Insights - Upstart Holdings is an AI-driven lending platform that collaborates with banks, credit unions, and capital providers to streamline the loan process while maintaining similar default rates compared to traditional underwriting models [1] Group 1: Company Overview - Upstart Holdings utilizes artificial intelligence to enhance the lending process, aiming to approve more borrowers efficiently [1] - The company partners with various financial institutions to create a faster loan approval system [1] Group 2: Investment Perspective - The Inevitable Investor focuses on stocks with differentiated potential, emphasizing quality over pure growth or value investing [1] - The articles aim to analyze stocks that may be mispriced by the market, either too optimistically or pessimistically [1]

Group 1 - Upstart Holdings and Nu Holdings are innovative fintech companies disrupting traditional financial institutions [1][2] - Upstart utilizes AI to analyze non-traditional data points for loan approvals, expanding access for individuals with limited credit histories [1][4] - NuBank is the largest digital bank in Latin America, primarily serving customers in Brazil, Mexico, and Colombia, with a digital-only model [2] Group 2 - Both companies have seen significant stock performance since their IPOs, with Upstart's shares rising from $20 to the low $50s and Nu's from $9 to about $16 [3] - Upstart's revenue surged 42% in 2020 and 264% in 2021, but faced a decline of 1% in 2022 and a 39% drop in 2023 due to rising interest rates [5] - Despite revenue challenges, Upstart's contribution margin improved from 50% in 2021 to 63% in 2023, driven by automation and a higher mix of "super prime" borrowers [6] Group 3 - In 2024, Upstart's revenue increased by 24% as the Federal Reserve cut benchmark interest rates, and its adjusted EBITDA turned positive for the year [7] - Upstart is currently approving more loans as interest rates decline, while Nu's growth is slowing and expenses are rising [8]

Core Insights - Fintech stocks, particularly StoneCo and Upstart, are gaining attention for their unique business models and growth trajectories [1][3] - StoneCo focuses on payments and financial services for small and medium-sized businesses in Brazil, while Upstart leverages AI for credit underwriting [2][21] StoneCo Overview - StoneCo reported a 27% year-over-year increase in adjusted net income and a 22% return on equity in Q2 2025, despite Brazil's challenging economic conditions [4] - The MSMB payments segment grew its client base to 4.5 million, a 17% increase, and PIX QR Code transaction volume rose by 59% [5] - The company’s integrated banking platform saw deposits increase by 36% year-over-year, with 83% of deposits being time-based, providing a stable funding base [5] - StoneCo's credit portfolio grew by 25% sequentially, with stable nonperforming loans, indicating disciplined underwriting practices [5] - The strategic sale of non-core assets allows StoneCo to focus on its core operations and target a total addressable market estimated at BRL 100 billion [6] - StoneCo has repurchased nearly BRL 2.6 billion in shares over the past year, reflecting management's confidence in the company's growth potential [6] - The company’s diversified revenue streams and margin expansion suggest it can maintain profitability even in a tough economic environment [7] Upstart Overview - Upstart's revenues surged to $257 million in Q2 2025, a 102% year-over-year increase, and the company returned to GAAP profitability with a net income of $5.6 million [8] - Loan originations reached $2.8 billion, driven by Upstart's AI model, which improved loan separation accuracy by 17 percentage points [8] - The company’s technology has led to improved conversion rates, rising from 19% to 23.9%, with 92% of loans now fully automated [9] - Upstart's diversification into auto and home lending is gaining traction, contributing to an 85% year-over-year increase in contribution profit [10] - However, Upstart's growth is accompanied by volatility due to its exposure to credit-sensitive borrowers and reliance on capital market sentiment [11][12] Financial Estimates and Valuation - Zacks Consensus Estimate for StoneCo implies a 15.73% increase in sales and a 22.86% increase in EPS for 2025 [13] - Upstart's sales are expected to rise by 73.32% in 2025, with upward revisions in EPS estimates over the past three months [14] - StoneCo is trading at a forward Price/Sales (P/S) ratio of 1.92, significantly lower than Upstart's 4.13, indicating a more favorable valuation for StoneCo [17] - Over the past three months, StoneCo shares have outperformed both Upstart and the S&P 500 composite [18] Conclusion - StoneCo is characterized by stable funding, recurring revenues, and robust cash generation, making it a more balanced and resilient fintech option [21][22] - Upstart, while offering explosive growth potential, is more susceptible to credit cycles and market volatility [21] - StoneCo's strategic focus on small business payments and banking in Brazil presents a significant growth opportunity with lower cyclicality [21]