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Upstart, reporting on revenue beat for the first quarter. The AI lending platform also posting adjusted EBITDA of $42.6 million. Here to discuss the quarter and more, let's get to Upstart CEO, Dave Girard. Dave, you just reported results. Uh, heading into this, we should remind our audience, listen, the stock was down about 25% this year. You were up though, about 100% in the past 12 months. Dave, but walk us through the, through the quarter. I'm interested in what you're seeing in the business.

Yeah, thanks, great to be here. Um, you know, a few things about the quarter, I'd say first and most importantly, because we have, you know, more than 100 banks and credit unions and, uh, private credit investors on our platform. The credit is performing exceptionally well. Um, and it has been for quite some time, all the way back to Q3, Q4 of 2023. All of our cohorts are performing better than expectations and we don't see any, uh, you know, I think it's important to kind of say in the world of today, we don't see any weakening in the consumer credit performance. So, so that's number one. That's the most important thing. Secondly, we're in growth mode. We grew our transactions 89% year on year. We grew revenue 67% year on year. And you mentioned, uh, our adjusted EBITDA, the margin on that was 20% for the first time in three years. And then lastly, and also really importantly, our businesses pretty rapidly diversifying. About a third of our core loans and our core personal loan product were super prime loans. That is people with credit scores higher than 720. And that means, you know, that's a, that's a segment of the market that we weren't even in not very long ago. And also our home product is growing or, or grew, I should say, 52% quarter to quarter, and our auto products grew 42% quarter to quarter. So, very rapid diversification, and I feel like we're doing exceptionally well right now.

Let me ask you, uh, Dave, though one issue, and the stock is under some pressure here, the revenue guide here for Q2. Um, it does look like it came in 225, the street was more like a 228. Were there certain puts and takes that maybe the analysts hadn't factored in?

You know, we, we provided annual guidance, and of course, this is the first time we're providing Q2 guidance. So people will just kind of extrapolate that as they wish. And you know, we are, of course, being, being reasonably cautious given there's a lot of unknowns out there. Our guidance does not assume for the year, does not assume any rate cuts from the Fed, which I think is a good place to stand, and doesn't assume any massive change in the macro from where it stands today. But we'll always take a, you know, position we feel good about. And you know, analysts can be a little off that, but you know, our business is growing quite rapidly. It's, it's on the very edge of being gap net income profitable. And, uh, the credit's performing exceptionally well. So I, you know, I couldn't be happier with the actual numbers.

I thought you, you do have an extremely line of sight there, David, into the consumer. And you're saying, and correct me if I'm wrong, you don't see big changes versus, let's say, six months ago or 12 months ago right now?

No, we don't. In that timeframe, the consumer financial health has actually improved pretty significantly. What we call the Upstart Macro Index is how we measure that, and it's really in the grander scheme of the last 12 months or so come down a lot, which is a good thing. It means the consumer health is getting better. Now, now realize, of course, that our interests are a little different than say a retailer who just wants consumers to keep spending. In our case, we like consumers who are either saving more, spending less, being responsible, because that's a creative to credit performance. So our interests are a little different, but from that perspective, consumers are actually doing quite well.

And Dave, listen, I got plenty of economists coming on the show. They tell me the odds of a recession are rising. If we did see that, Dave, if, if the US economy did slip into contraction, that would mean what for your company?

Well, again, it's a little bit of a mix. It means, and it depends how, how it plays out. But you know, a modest recession where GDP kind of shrinks a little bit as it might have last quarter, might be right now, doesn't actually mean much to us. What we really care about again is consumer financial health. And oftentimes in a recession, what's going on is consumers are spending less. That can be net good for us. So, so generally speaking, um, a recession's okay, unless it leads to pretty dramatic increase in unemployment, which is, of course, negative to credit. But, you know, 4% unemployment to four and a half, that's not really all that meaningful to us. If it went 4 to 8% or 9%, you know, that's is meaningful to us. But we've also gotten really good. Our technology's getting better and better at tracking and responding to changes in the macro environment extremely quickly.

You talk about the tech, Dave, and you are an AI lending platform. I'm curious how, how do you see the technology evolving? You know, if you are, we're talking 12 months from now, David, how does it evolve, and how does it evolve in ways that benefit you?

Well, the, the sort of the way it's been on is it creates more accuracy of risk models, and that means more separation between good borrowers and bad borrowers, more automation of the process. Whenever these models get upgraded, it generally leads to higher conversions through our funnel, and that's how we grow. So what I expect to see in the next 12 months is our core product will continue to grow fairly rapidly as we're expanding into new segments. Uh, and then our newer products, as I mentioned earlier, the auto product, the home product are on very robust growth paths. So we're getting more diverse. We're applying the same AI technology to more segments. And, uh, so we're at the very early days. I think just the segments we're in today, just the products we have in the market today have years and years of growth in front of them. And our, our goal frankly is to be number one in market share in every category we're in, and I think we have the technology and the team to do just that.

Dave, thank you so much for joining us today. Appreciate your time as always.

Thank you.