공시 • Apr 09
Pomerantz Law Firm Announces the Filing of A Class Action Against Upstart Holdings, Inc. and Certain Officers
Pomerantz LLP announced that a class action lawsuit has been filed against Upstart Holdings, Inc. and certain officers. The class action, filed in the United States District Court for the Southern District of New York, and docketed under 26-cv-02974, is on behalf of a class consisting of all persons and entities other than Defendants that purchased or otherwise acquired Upstart securities between May 14, 2025 and November 4, 2025, both dates inclusive (the Class Period), seeking to recover damages caused by Defendants' violations of the federal securities laws and to pursue remedies under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder, against the Company and certain of its top officials. Upstart, together with its subsidiaries, operates a cloud-based artificial intelligence lending platform in the United States. Its platform includes unsecured personal loans, small dollar loans, auto refinance, auto retail loans, auto secured personal loans, and home equity lines of credit. Upstart purportedly uses its proprietary AI models to, inter alia, more accurately quantify the true risk of a loan, a process that it refers to as risk separation. The Company claims that this differentiated approach to underwriting has generally led to higher approvals and lower interest rates relative to traditional lending practices, providing more predictable returns to its capital partners, including banks, credit unions, and institutional investors. Defendants periodically calibrate Upstart's AI models to improve accuracy and automation of loan approvals. In early May 2025, Upstart launched the latest iteration of its AI model, referred to as Model 22. At all relevant times, Defendants touted the purported accuracy of Model 22, claiming that it was increasing loan approval rates and, accordingly, the Company's revenues and growth. For example, in February 2025, Upstart issued financial guidance for the full year of 2025, including, inter alia, revenue of approximately $1 billion, which included revenue from fees of approximately $920 million. In May 2025, Defendants slightly raised the foregoing guidance to revenue of approximately $1.01 billion, which still included revenue from fees of approximately $920 million. Then, in August 2025, Defendants substantially raised the foregoing guidance to revenue of approximately $1.055 billion, which included revenue from fees of approximately $990 million – $70 million more than previously projected – citing improvements in performance driven by Model 22. The complaint alleges that, throughout the Class Period, Defendants made materially false and misleading statements regarding the Company's business, operations, and prospects. Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (i) Model 22 frequently overreacted to negative macroeconomic signals in performing its risk-separation processes; (ii) accordingly, Model 22's overall accuracy and propensity to increase loan approval rates was overstated; (iii) Model 22's overly conservative assessment of credit and macroeconomic conditions was having a significant negative impact on Upstart's revenue results, rendering the Company's previously issued Fiscal Year 2025 revenue guidance unreliable and/or unrealistic; and (iv) as a result, Defendants' public statements were materially false and misleading at all relevant times. The truth began to emerge on November 4, 2025, when Upstart issued a press release reporting its financial results for the third quarter of 2025. Upstart reported, inter alia, third quarter 2025 revenue of $277 million, missing its previously issued third quarter 2025 revenue guidance of approximately $280 million, as well as consensus estimates by $2.62 million. Upstart also reported that it expected to generate revenue of only $288 million in the fourth quarter of 2025, significantly below consensus estimates of $303.7 million. Further, Upstart negatively revised its Fiscal Year 2025 revenue guidance to approximately $1.035 billion, versus the $1.06 billion consensus estimate and its prior guidance of approximately $1.055 billion, as well as its expected Fiscal Year 2025 revenue from fees, which it reduced to approximately $946 million from its prior outlook of approximately $990 million.