Upstart (NASDAQ:UPST) Releases Quarterly Earnings Results, Beats Estimates By $0.13 EPS

Upstart (NASDAQ:UPST) issued its quarterly earnings data on Tuesday. The company reported $0.33 earnings per share (EPS) for the quarter, beating the consensus estimate of $0.20 by $0.13, FiscalAI reports. Upstart had a return on equity of 7.13% and a net margin of 4.84%. The business had revenue of $370.52 million during the quarter, compared to analysts’ expectations of $362.68 million. During the same quarter in the previous year, the firm posted $0.23 EPS. The company’s revenue for the quarter was up 33.7% on a year-over-year basis.

Here are the key takeaways from Upstart’s conference call:

• Q3 execution was strong despite worsening macro conditions. Contribution Profit reached a record $218 million, up 48% year over year, while total originations rose 44% to $4.1 billion and fee revenue increased 41% to $364 million.
• Secured lending reached profitability ahead of schedule. Secured contribution margin improved to positive 17% from negative 35% in Q2, driven by better loan-sale terms, increased automation, and improved conversion and monetization.
• Higher borrower delinquencies, inflation, and interest rates are pressuring originations and balance-sheet income. Upstart lowered its full-year outlook to approximately $1.35 billion in revenue and $260 million in Adjusted EBITDA, versus prior guidance of $1.4 billion and $294 million, respectively.
• The company reported improving capital efficiency, with equity capital used falling to 9% of platform loans from 11.6% a year ago and loans held directly on its balance sheet declining to 4.8%. Upstart expects its bank, subject to regulatory approval, to launch in early 2027 and potentially release cash by shifting much of the existing loan book to deposit funding.
• Management remains confident in long-term growth from technology, marketing, and a broader customer ecosystem. More than 555,000 borrowers took out loans in Q3, including over 250,000 returning customers, while the company plans to refocus its secured products on growth in 2027 after establishing positive margins.

Upstart Stock Up 0.3%

UPST stock opened at $21.37 on Wednesday. Upstart has a 52-week low of $20.59 and a 52-week high of $52.10. The firm has a market cap of $2.08 billion, a P/E ratio of 43.61, a PEG ratio of 0.75 and a beta of 2.48. The company’s 50-day simple moving average is $24.98 and its 200-day simple moving average is $29.76.

Wall Street Analysts Forecast Growth

Several research analysts recently weighed in on the company. Piper Sandler lifted their price target on Upstart from $46.00 to $51.00 and gave the company an “overweight” rating in a research report on Wednesday, August 5th. Needham & Company LLC lowered their price objective on Upstart from $42.00 to $30.00 and set a “buy” rating on the stock in a research report on Tuesday. Loop Capital initiated coverage on Upstart in a research report on Tuesday, September 8th. They issued a “hold” rating and a $34.00 price objective on the stock. BTIG Research dropped their price objective on shares of Upstart from $43.00 to $40.00 and set a “buy” rating on the stock in a research note on Tuesday. Finally, Citizens Jmp cut their target price on shares of Upstart from $20.00 to $18.00 and set a “market underperform” rating for the company in a report on Thursday, October 15th. Seven equities research analysts have rated the stock with a Buy rating, seven have issued a Hold rating and three have assigned a Sell rating to the company. According to MarketBeat, the stock currently has an average rating of “Hold” and a consensus target price of $39.31.

Insiders Place Their Bets

In other Upstart news, CEO Paul Gu purchased 50,000 shares of the business’s stock in a transaction that occurred on Thursday, September 10th. The stock was purchased at an average price of $25.55 per share, for a total transaction of $1,277,500.00. Following the purchase, the chief executive officer directly owned 130,000 shares in the company, valued at approximately $3,321,500. This trade represents a 62.50% increase in their ownership of the stock. The acquisition was disclosed in a legal filing with the Securities & Exchange Commission, which is available through this hyperlink. Also, insider Natalia Mirgorodskaya sold 913 shares of the company’s stock in a transaction dated Tuesday, August 25th. The stock was sold at an average price of $30.03, for a total value of $27,417.39. Following the completion of the transaction, the insider directly owned 35,875 shares of the company’s stock, valued at $1,077,326.25. The trade was a 2.48% decrease in their position. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold 148,652 shares of company stock worth $4,133,720 in the last 90 days. 17.29% of the stock is currently owned by company insiders.

Key Headlines Impacting Upstart

Here are the key news stories impacting Upstart this week:

• Positive Sentiment: Upstart reported Q3 revenue of about $371 million, up roughly 34% year over year, and adjusted EPS of $0.33, above analysts’ estimate of $0.20. Contribution profit reached a record, and the secured-loan business turned profitable. 3 Key Takeaways From Upstart’s Latest Report
• Neutral Sentiment: BTIG and Needham cut their price targets to $40 and $30, respectively, but both maintained Buy ratings. The reductions may temper enthusiasm, while the continued ratings signal that the analysts see potential upside. BTIG Research ratings
• Negative Sentiment: Despite the quarterly beat, Upstart’s outlook was cautious: it lowered full-year revenue guidance amid macroeconomic headwinds and balance-sheet pressure, while cutting EBITDA guidance. That guidance likely overshadowed the strong Q3 figures and contributed to shares reversing an initial post-earnings gain. Upstart reports Q3 earnings above expectations; guides on 2026 with caution

Upstart Company Profile

Upstart Holdings, Inc (NASDAQ: UPST) operates an artificial intelligence-powered lending marketplace. Its platform connects consumers seeking credit with banks and credit unions, using data-driven underwriting models designed to evaluate applicants beyond traditional credit-score-based methods.

The company provides technology for several lending categories, including personal loans, automotive retail and refinance lending, home equity lines of credit, and small-dollar lending. Upstart’s platform supports financial institutions with application processing, risk assessment, loan origination, and related automation, while offering consumers a digital borrowing experience.

Founded in 2012, Upstart is headquartered in San Mateo, California, and primarily serves the United States.