Why Is UPST Stock Surging Over 11% Overnight?

Upstart Holdings posted $365 million in revenue, up 42% year-on-year, and ahead of Wall Street expectations.

• The lending company said that loan originations in the quarter came in at $4.2 billion, up 50% year-over-year, with 558,014 loans originated. 
• The company reported net income of $16.5 million, up 195% year-over-year. 
• CEO Paul Gu said Q2 marked the first quarter under the new management team's strategy, highlighting that Upstart achieved loan growth, strong credit performance, and expanding margins simultaneously.

Shares of Upstart Holdings Inc. (UPST) surged 11% in the overnight session on Tuesday after the company posted stellar second-quarter (Q2) results that zoomed past Wall Street expectations. 

The lending platform posted $365 million in revenue, up 42% year-on-year, and ahead of Wall Street expectations of $352.23 million, as per Fiscal.ai data. However, adjusted earnings per share of $0.16 came in below analysts’ expectations. 

The company’s other metrics, including loan originations, net income, and adjusted earnings before interest, taxes, depreciation and amortization, were significantly stronger, adding to investor optimism. 

Upstart’s Loan Originations Demonstrated Strong Growth 

The AI lending company said that loan originations in the quarter came in at $4.2 billion, up 50% year-over-year, with 558,014 loans originated. 

The core personal loan segment was the primary driver of growth, rising 27% sequentially by adding $526 million in sequential increase, which the company said was more than three and a half times the growth of the prior three quarters combined.

Auto and home lending also improved, though less meaningfully than personal loans. 

“The primary difference between this quarter and earlier ones really comes back to one of management focus. We were extremely focused this quarter on this core segment and it showed up in the results, and we think that’s something that can continue,” CEO Paul Gu said in a call with investors. 

Upstart’s Other Strong Metrics

The company raked in a net income of $16.5 million, up 195% year-over-year. Adjusted EBITDA climbed 45% to $76.9 million, with the adjusted EBITDA margin at 21%. 

Upstart also clocked an all-time high contribution profit of $193 million, up 37% year-over-year. 

Gu said Q2 marked the first quarter under the new management team's strategy, highlighting that Upstart achieved loan growth, strong credit performance, and expanding margins simultaneously. 

“We grew, our credit performed, and we expanded margins. We didn’t have to trade one for another, and that combination, not any single metric in isolation, is the clearest evidence that our AI advantage is real and compounding. You should expect us to double down in the second half of this year,” he said. 

“Looking ahead, the company plans to double down on technology and marketing investments to accelerate growth in its core personal loan business, improve profitability in secured lending, deepen third-party funding relationships, and maintain disciplined capital allocation,” Gu added. 

Upstart reaffirmed its full-year guidance for 2026, with a revenue forecast of about $1.4 billion and adjusted EBITDA of about $294 million, maintaining a margin of 21%.

Upstart’s Banking Progress

Upstart said launching its bank remains one of the company's biggest initiatives, with the bank expected to improve operational and regulatory efficiency while maintaining its capital-light model of primarily funding loans through third-party partners. The company still expects to launch the bank in early 2027.

UPST Stock: What Does Retail Think?

On Stocktwits, retail sentiment around UPST stock improved from ‘bullish’ to ‘extremely bullish’ territory over 24 hours as message volumes jumped 325%. 

One bullish user said, “$UPST ER BEAT. Looks like it's a good time to start a position and ride up for at least 50%+ gain from here.”

Another user predicted a price target of $60, almost double the last closing price. 

A third user said, “$UPST accumulating as much as you could. It’s a 100+ stock, AI-automated loans generating,  profitable, 50% yoy growth. You can’t find many such great companies in the market right now.”

UPST stock is on track to clock a fifth-consecutive session in the green if gains hold. 

The stock has lost about 34% of its value so far this year. 

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