Upstart (UPST) investor relations material

Executive summary

• Achieved 50% year-over-year growth in loan originations, reaching $4.2 billion, driven by AI model improvements, product initiatives, and rapid scaling of secured products.

• Returned to GAAP profitability with net income of $17 million (5% margin), up 195% year-over-year, and all-time high $193 million contribution profit.

• Adjusted EBITDA was $77 million (21% margin), meeting full-year targets and reflecting improved operating leverage.

• Maintained strong credit performance and capital efficiency, with loans on balance sheet at 5.9% of total, the lowest in nearly two years.

• Secured conditional OCC approval for a bank charter, targeting operational launch in early 2027.

Financial highlights

• Total originations reached $4.2 billion, up 50% year-over-year and 23% sequentially.

• Total revenue was $365 million, up 42% year-over-year and 18% sequentially; fee revenue was $348 million, up 45% year-over-year and 26% sequentially.

• Contribution margin improved to 55% from 50% in Q1, with unsecured at 62% and secured at -35% (up 61 points sequentially).

• Adjusted EBITDA was $77 million (21% margin), up 45% year-over-year.

• GAAP operating expenses were $350 million, up 39% year-over-year and 11% sequentially.

Outlook and guidance

• Full-year 2026 revenue expected at $1.4 billion, with $1.3 billion from fees and adjusted EBITDA of $294 million (21% margin); guidance reaffirmed.

• Expect secured products to reach contribution margin breakeven by Q4 2026.

• Fixed expenses projected to grow low single digits sequentially in Q3 and Q4.

• Guidance assumes UMI remains at 1.50, the top of the initial range, through year-end.