Upstart Holdings Inc (NASDAQ:UPST) stock rallied on Wednesday fending off last night’s downbeat, expectation-missing, fourth-quarter results.
The AI-lending app firm saw its share rocket some US$4.09, or 24% higher despite telling the market that it would reach US$100 million of first-quarter revenue, rather than the US$153 million projected by market consensus.
The California-based company however flagged an anticipated US$45 million earnings loss for the first three months of 2023, compared to analyst forecasts for US$13.2 million.
For the fourth quarter, Upstart reported a US$55.3 million net loss equating to 67 cents per share, compared to US$58.9 million and 61 cents in the same quarter of 2022. Quarterly revenue dropped to US$147 million from US$4305 million but nevertheless ended up higher than the consensus forecast which was pitched at US$134 million.
Upstart reportedly assured analysts on its investor call that it would focus on profitability and limit balance-sheet lending.
One analyst, quoted in a Marketwatch report, claimed that while weak guidance isn’t helpful there’s some hope for a “better-than-feared” outcome.
Indeed, today, Upstart was up over 24% at US$21.01 per share.
Upstart shares are still down some 80% over the past 12 months and its peak of around US$157 in March 2022.
The company describes its app as an artificial intelligence lending marketplace designed to improve access to affordable credit while reducing risk and costs to its bank partners.