All,
Here it goes.
Second Quarter 2024 Financial Highlights
Revenue. Total revenue was $128 million, a decrease of 6% from the second quarter of 2023, and remained flat sequentially. Total fee revenue was $131 million, a decrease of 9% year-over-year.
Transaction Volume and Conversion Rate. 143,900 loans were originated, totaling $1.1 billion across our platform in the second quarter of 2024, down 6% from the same quarter of the prior year.
Conversion on rate requests was 15% in the second quarter of 2024, up from 9% in the same quarter of the prior year.
Income (Loss) from Operations. Income (loss) from operations was ($55.5) million, down from ($33.3) million in the same quarter of the prior year.
Net Income (Loss) and EPS. GAAP net income (loss) was ($54.5) million, down from ($28.2) million in the second quarter of the prior year.
Adjusted net income (loss) was ($15.3) million, down from $5.4 million in the same quarter of the prior year. Accordingly, GAAP diluted earnings per share was ($0.62), and diluted adjusted earnings per share was ($0.17) based on the weighted-average common shares outstanding during the quarter.
Contribution Profit. Contribution profit was $76.1 million in the second quarter of 2024, down 21% year-over-year, with a contribution margin of 58% compared to a 67% contribution margin in the same quarter of the prior year.
Adjusted EBITDA. Adjusted EBITDA was ($9.3) million, down from $11.0 million in the same quarter of the prior year. The second quarter 2024 adjusted EBITDA margin was (7%) of total revenue, down from 8% in the same quarter of the prior year.
Financial Outlook
For the third quarter of 2024, Upstart expects:
Revenue of approximately $150 million
Revenue From Fees of approximately $155 million
Net Interest Income (Loss) of approximately ($5) million
Contribution Margin of approximately 57%
Net Income (Loss) of approximately ($49) million
Adjusted Net Income (Loss) of approximately ($14) million
Adjusted EBITDA of approximately ($5) million
Basic Weighted-Average Share Count of approximately 90.0 million shares
Diluted Weighted-Average Share Count of approximately 90.0 million shares
For the second half of 2024, Upstart expects:
Revenue from fees of approximately $320 million, and
Positive EBITDA in the fourth quarter
Note from CEO:
“The guidance we released today demonstrates that we’re on track toward resuming our role as the fintech known for high growth and healthy margins,” said Dave Girouard, CEO, Upstart. “The improvements in our business are coming from significant advances in our AI model, a revitalized funding supply, and increased operating efficiency. These wins and more are providing the foundation for the Upstart comeback story.”
Personal thoughts.
Upstart is already back on a growth track and on a good track to return to profitability. 2025 should see Positive net profits. Management is confident of growth in current environment and reduction of interest rates and improving macro conditions are tailwinds.
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