AI lending platform Upstart (NASDAQ: UPST) reported revenue ahead of Wall Street’s expectations in Q2 CY2026, with sales up 41.7% year on year to $364.7 million. On the other hand, the company’s full-year revenue guidance of $1.4 billion at the midpoint came in 1.7% below analysts’ estimates. Its GAAP profit of $0.16 per share was 16.7% below analysts’ consensus estimates.
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Upstart (UPST) Q2 CY2026 Highlights:
- Revenue: $364.7 million vs analyst estimates of $356.7 million (41.7% year-on-year growth, 2.3% beat)
- EPS (GAAP): $0.16 vs analyst expectations of $0.19 (16.7% miss)
- Adjusted EBITDA: $76.91 million vs analyst estimates of $64.81 million (21.1% margin, 18.7% beat)
- The company reconfirmed its revenue guidance for the full year of $1.4 billion at the midpoint
- Operating Margin: 4%, up from 1.8% in the same quarter last year
- Free Cash Flow was -$135.9 million compared to -$147.2 million in the previous quarter
- Market Capitalization: $2.82 billion
Company Overview
Using over 2,500 data variables and trained on nearly 82 million repayment events, Upstart (NASDAQ: UPST) is an AI-powered lending platform that uses machine learning to help banks and credit unions more accurately assess borrower risk for personal loans, auto loans, and home equity lines of credit.
Revenue Growth
A company’s long-term sales performance can indicate its overall quality. Any business can put up a good quarter or two, but the best consistently grow over the long haul. Over the last five years, Upstart grew its sales at a decent 21.7% compounded annual growth rate. Its growth was slightly above the average software company and shows its offerings resonate with customers.
We at StockStory place the most emphasis on long-term growth, but within software, a half-decade historical view may miss recent innovations or disruptive industry trends. Upstart’s annualized revenue growth of 53.3% over the last two years is above its five-year trend, suggesting its demand recently accelerated. 
This quarter, Upstart reported magnificent year-on-year revenue growth of 41.7%, and its $364.7 million of revenue beat Wall Street’s estimates by 2.3%.
Looking ahead, sell-side analysts expect revenue to grow 30.8% over the next 12 months, a deceleration versus the last two years. Despite the slowdown, this projection is healthy and indicates the market is forecasting success for its products and services.
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Total Transaction Volume
Total transaction volumes show the aggregate dollar value of loans processed on Upstart’s platform. This is the number from which the company will ultimately collect fees, and the higher it is, the more accurate its software becomes at assessing credit risk.
Upstart’s transaction volume punched in at $4.23 billion in Q2, and over the last four quarters, its growth was fantastic as it averaged 54.3% year-on-year increases. This alternate topline metric grew faster than total sales, meaning its loan processing fees outpaced the interest income from loans retained on its balance sheet. If this trend continues, it would lower Upstart’s risk profile as it would reduce its exposure to delinquencies and defaults. 
Customer Acquisition Efficiency
The customer acquisition cost (CAC) payback period measures the months a company needs to recoup the money spent on acquiring a new customer. This metric helps assess how quickly a business can break even on its sales and marketing investments.
Upstart is extremely efficient at acquiring new customers, and its CAC payback period checked in at 18.6 months this quarter. The company’s rapid recovery of its customer acquisition costs indicates it has a highly differentiated product offering and a strong brand reputation. These dynamics give Upstart more resources to pursue new product initiatives while maintaining the flexibility to increase its sales and marketing investments.
Key Takeaways from Upstart’s Q2 Results
It was encouraging to see Upstart beat analysts’ revenue expectations this quarter. Adjusted EBITDA also beat handily. On the other hand, its full-year revenue guidance missed. Overall, this was a mixed quarter. The stock traded up 10.9% to $33.87 immediately following the results.
Should you buy the stock or not? What happened in the latest quarter matters, but not as much as longer-term business quality and valuation, when deciding whether to invest in this stock. We cover that in our actionable full research report which you can read here (it’s free).
