Upstart Stock Plunges 20% after Admitting It Won't Hit Disappointing Forecast
Tiger Newspress2022-07-08
Upstart $(UPST)$ disclosed late Thursday that executives expect second-quarter losses and revenue to come in well short of targets they forecast in May, when the company's disappointing forecast led to shares being cut by more than half in a single session.
Upstart, which lends money while leveraging artificial intelligence to make loan decisions, revealed that revenue for the second quarter is now expected to be roughly $228 million, after originally guiding for sales of $295 million to $305 million. Analysts had been estimating second-quarter sales of $335 million before Upstart provided guidance, and had since brought down that target to $298 million, according to FactSet.
The lending company's second-quarter loss is now expected to be $27 million to $31 million, after executives previously guided for breakeven to a loss of $4 million. Analysts polled by FactSet still expected Upstart to produce a small profit of less than $1 million despite that guidance, a reduction from expectations of $24 million in profit before the guidance.
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