Upstart Holdings Soars on Unexpected Profit and Strong Guidance
Key Takeaways:
* Upstart Holdings reports surprising Q4 adjusted profit, driving stock surge.
* Revenue exceeds estimates, fueled by increased transaction loan revenue and volume.
* AI lending platform offers optimistic outlook for current quarter.
Shares of Upstart Holdings (UPST) surged by 25.85% on Wednesday following the company's announcement of a surprise adjusted profit and strong guidance.
Fourth Quarter Results
Upstart reported Q4 adjusted EPS of $0.26, exceeding analysts' expectations of an adjusted loss per share of $0.03. Revenue climbed by 56% year-over-year to $219.0 million, also surpassing forecasts.
Transaction revenue saw a significant increase of 68% to $2.11 billion, while the number of loans surged by 89% to 245,663.
Management Outlook
CEO Dave Girouard stated that Upstart experienced "dramatic business growth across all product categories" in Q4. The company enters 2023 with optimism for the future of AI lending.
Current Quarter Outlook
For the current quarter, Upstart anticipates a GAAP net loss of approximately $20 million and revenue of around $200 million. Visible Alpha estimates were slightly more pessimistic, predicting a loss of $31.3 million and revenue of $180.5 million.
Stock Performance
Upstart Holdings shares reached their highest level since April 2022 after the positive earnings report.