Upstart Shares Rocket on Strong Earnings

<p><strong>SAN MATEO<&sol;strong> &&num;8212&semi; Upstart Holdings&comma; which operates an artificial intelligence &lpar;AI&rpar; lending marketplace&comma; announced financial results for the quarter and full year ended December 31&comma; 2024&period; Shares in the company rocketed over 30&percnt; on the news Wednesday&period;<&sol;p>&NewLine;<p>&OpenCurlyDoubleQuote;In Q4 of 2024&comma; our business grew dramatically across all product categories&comma; delivered Adjusted EBITDA at levels not seen since the first quarter of 2022&comma; and came within a whisker of returning to GAAP profitability&comma;” said Dave Girouard&comma; co-founder and CEO of Upstart&period; &OpenCurlyDoubleQuote;We launched into 2025 with unparalleled energy and optimism for the future of Upstart AI lending and the mission we’re on together&period;”<&sol;p>&NewLine;<p><b>Fourth Quarter 2024 Financial Highlights<&sol;b><&sol;p>&NewLine;<ul class&equals;"bwlistdisc">&NewLine;<li><b>Total Revenue<&sol;b> was &dollar;219 million&comma; up 56&percnt; year-over-year &lpar;&&num;8220&semi;YoY&&num;8221&semi;&rpar; and up 35&percnt; quarter-over-quarter &lpar;&&num;8220&semi;QoQ&&num;8221&semi;&rpar;&period; Total fee revenue was &dollar;199 million&comma; an increase of 30&percnt; YoY&comma; and up 19&percnt; QoQ&period;<&sol;li>&NewLine;<&sol;ul>&NewLine;<ul class&equals;"bwlistdisc">&NewLine;<li><b>Transaction Volume and Conversion Rate&colon;<&sol;b> 245&comma;663 loans were originated&comma; totaling &dollar;2&period;1 billion&comma; up 68&percnt; YoY and up 33&percnt; QoQ&period; Our Conversion Rate was 19&period;3&percnt;&comma; up from 11&period;6&percnt; in Q4 2023&period;<&sol;li>&NewLine;<&sol;ul>&NewLine;<ul class&equals;"bwlistdisc">&NewLine;<li><b>Income &lpar;Loss&rpar; from Operations <&sol;b>was &lpar;&dollar;4&period;8&rpar; million&comma; up from &lpar;&dollar;47&period;5&rpar; million in Q4 2023&period;<&sol;li>&NewLine;<&sol;ul>&NewLine;<ul class&equals;"bwlistdisc">&NewLine;<li><b>Net Income &lpar;Loss&rpar; and EPS&colon; <&sol;b>GAAP net income &lpar;loss&rpar; was &lpar;&dollar;2&period;8&rpar; million&comma; up from &lpar;&dollar;42&period;4&rpar; million in Q4 2023&period; Adjusted net income &lpar;loss&rpar; was &dollar;29&period;9 million&comma; up from &lpar;&dollar;9&period;7&rpar; million in Q4 2023&period; Accordingly&comma; GAAP diluted earnings per share was &lpar;&dollar;0&period;03&rpar;&comma; and diluted adjusted earnings per share was &dollar;0&period;26 based on the weighted-average common shares outstanding during the quarter&period;<&sol;li>&NewLine;<&sol;ul>&NewLine;<ul class&equals;"bwlistdisc">&NewLine;<li><b>Contribution Profit<&sol;b> was &dollar;122 million in the fourth quarter of 2024&comma; up 28&percnt; YoY&comma; with a Contribution Margin of 61&percnt; compared to 63&percnt; in Q4 2023&period;<&sol;li>&NewLine;<&sol;ul>&NewLine;<ul class&equals;"bwlistdisc">&NewLine;<li><b>Adjusted EBITDA<&sol;b> was &dollar;38&period;8 million&comma; up from &dollar;0&period;6 million in the same quarter of the prior year&period; Adjusted EBITDA Margin was 18&percnt; of total revenue&comma; up from 0&percnt; in Q4 2023&period;<&sol;li>&NewLine;<&sol;ul>&NewLine;<p><b>Fiscal Year 2024 Financial Highlights<&sol;b><&sol;p>&NewLine;<ul class&equals;"bwlistdisc">&NewLine;<li><b>Total Revenue<&sol;b> was &dollar;637 million&comma; up 24&percnt; YoY&period; Total fee revenue was &dollar;635 million&comma; up 13&percnt; YoY&period;<&sol;li>&NewLine;<&sol;ul>&NewLine;<ul class&equals;"bwlistdisc">&NewLine;<li><b>Transaction Volume and Conversion Rate&colon;<&sol;b> 697&comma;092 loans were originated&comma; totaling &dollar;5&period;9 billion&comma; up 28&percnt; YoY&period; Our Conversion Rate was 16&period;5&percnt; in 2024&comma; up from 9&period;7&percnt; in 2023&period;<&sol;li>&NewLine;<&sol;ul>&NewLine;<ul class&equals;"bwlistdisc">&NewLine;<li><b>Income &lpar;Loss&rpar; from Operations<&sol;b> was &lpar;&dollar;173&rpar; million&comma; up from &lpar;&dollar;257&rpar; million in 2023&period;<&sol;li>&NewLine;<&sol;ul>&NewLine;<ul class&equals;"bwlistdisc">&NewLine;<li><b>Net Income &lpar;Loss&rpar; and EPS&colon; <&sol;b>GAAP net income &lpar;loss&rpar; was &lpar;&dollar;129&rpar; million&comma; up from &lpar;&dollar;240&rpar; million in 2023&period; Adjusted net income &lpar;loss&rpar; was &lpar;&dollar;17&period;8&rpar; million&comma; up from &lpar;&dollar;46&period;9&rpar; million in 2023&period; Accordingly&comma; GAAP diluted earnings per share was &lpar;&dollar;1&period;44&rpar;&comma; and diluted adjusted earnings per share was &lpar;&dollar;0&period;20&rpar; based on the weighted-average common shares outstanding during the year&period;<&sol;li>&NewLine;<&sol;ul>&NewLine;<ul class&equals;"bwlistdisc">&NewLine;<li><b>Contribution Profit <&sol;b>was &dollar;382 million in 2024&comma; up 8&percnt; YoY&comma; with a Contribution Margin of 60&percnt; compared to 63&percnt; in 2023&period;<&sol;li>&NewLine;<&sol;ul>&NewLine;<ul class&equals;"bwlistdisc">&NewLine;<li><b>Adjusted EBITDA <&sol;b>was &dollar;10&period;6 million&comma; up from &lpar;&dollar;17&period;2&rpar; million in 2023&period; 2024 Adjusted EBITDA Margin was 2&percnt; of total revenue&comma; up from &lpar;3&rpar;&percnt; in 2023&period;<&sol;li>&NewLine;<&sol;ul>&NewLine;<p>&nbsp&semi;<&sol;p>&NewLine;<p><b>Financial Outlook<&sol;b><&sol;p>&NewLine;<p>For the first quarter of 2025&comma; Upstart expects&colon;<&sol;p>&NewLine;<ul class&equals;"bwlistdisc">&NewLine;<li><b>Revenue<&sol;b> of approximately &dollar;200 million&NewLine;<ul class&equals;"bwlistcircle">&NewLine;<li><b>Revenue From Fees <&sol;b>of approximately &dollar;185 million<&sol;li>&NewLine;<li><b>Net Interest Income &lpar;Loss&rpar; <&sol;b>of approximately &dollar;15 million<&sol;li>&NewLine;<&sol;ul>&NewLine;<&sol;li>&NewLine;<li><b>Contribution Margin <&sol;b>of approximately 57&percnt;<&sol;li>&NewLine;<li><b>GAAP Net Income &lpar;Loss&rpar; <&sol;b>of approximately &lpar;&dollar;20&rpar; million<&sol;li>&NewLine;<li><b>Adjusted Net Income &lpar;Loss&rpar; <&sol;b>of approximately &dollar;16 million<&sol;li>&NewLine;<li><b>Adjusted EBITDA <&sol;b>of approximately &dollar;27 million<&sol;li>&NewLine;<li><b>Basic Weighted-Average Share Count <&sol;b>of approximately 95 million shares<&sol;li>&NewLine;<li><b>Diluted Weighted-Average Share Count <&sol;b>of approximately 105 million shares<&sol;li>&NewLine;<&sol;ul>&NewLine;<p>For full year 2025&comma; Upstart expects&colon;<&sol;p>&NewLine;<ul class&equals;"bwlistdisc">&NewLine;<li><b>Revenue<&sol;b> of approximately &dollar;1 billion&NewLine;<ul class&equals;"bwlistcircle">&NewLine;<li><b>Revenue From Fees<&sol;b> of approximately &dollar;920 million<&sol;li>&NewLine;<li><b>Net Interest Income &lpar;Loss&rpar;<&sol;b> of approximately &dollar;80 million<&sol;li>&NewLine;<&sol;ul>&NewLine;<&sol;li>&NewLine;<li><b>Adjusted EBITDA Margin<&sol;b> of approximately 18&percnt;<&sol;li>&NewLine;<li><b>GAAP Net Income <&sol;b>to be at least breakeven<&sol;li>&NewLine;<&sol;ul>&NewLine;

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