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UPST · Forward model · Core personal (FICO under 720) · Gu case

What has to happen in Core personal (FICO under 720)

Model as of

This page changes Core personal (FICO under 720) inside the complete UPST model. Every other vertical, corporate programme and valuation assumption stays in the selected portfolio case.

UPST forward model
Horizon
Consolidated fair value $120.42 all other verticals held in this portfolio case
Final-quarter revenue $800M 50% of company revenue
Explicit segment contribution $4.34B EBITDA less segment capex, before corporate items

Paul Gu's version, taken literally: the technology advantage compounds, secured turns profitable, and a national bank charter lets Upstart originate and fund on its own rails - all of it paid for without issuing equity. Every line is lifted, because a compounding platform advantage is a claim about the platform rather than about one product. Read the charter carefully before pricing it. What Upstart has is CONDITIONAL approval from one of three regulators: FDIC deposit insurance is still pending, the Federal Reserve has not approved the holding company, and the 10-Q says in terms that the applications may be denied or delayed. Management targets early 2027, has published no figure for what deposit funding would be worth, and none of it is in the 2026 guide. So the benefit appears here as a margin delta and a higher exit multiple, which is an assumption wearing the costume of a mechanism.

Core personal (FICO under 720)

Basis quarter$224M
Final quarter$800M
Implied CAGR+29%
Final revenue mix50%

Upstart's own name for its engine: personal loans to borrowers below a 720 FICO, where an AI model that reads more than a credit score is supposed to have the biggest edge over a bank. $2,496M of originations in the basis quarter, 69% of unsecured volume, re-accelerating 27% sequentially after two flat quarters and a decline. Management calls this the superpower and credits it for the contribution margin recovering to 62%. It is the largest line in this model and the one that has to keep working.

Last four quarters
2025 Q3 $177M Estimated
2025 Q4 $177M Estimated
2026 Q1 $172M Estimated
2026 Q2 $224M Estimated
Personal loans to borrowers below 720 FICO
Units 2496/qtr growing +5.0% per quarter $2,496M of originations in the basis quarter, from page 14 of the Q2 2026 investor presentation.
Price per unit $89668 drifting 0.0% per quarter $89,668 of fee per $M originated - 8.97% - the Unsecured Lending take rate, applied to all its lines alike.
Core personal (FICO under 720)

Latest: $800M (2031Q2E)

Period Value
2025Q1 $122M
2025Q2 $164M
2025Q3 $177M
2025Q4 $177M
2026Q1 $172M
2026Q2 $224M
2026Q3E $239M
2026Q4E $254M
2027Q1E $271M
2027Q2E $289M
2027Q3E $308M
2027Q4E $328M
2028Q1E $350M
2028Q2E $372M
2028Q3E $397M
2028Q4E $423M
2029Q1E $451M
2029Q2E $481M
2029Q3E $512M
2029Q4E $546M
2030Q1E $582M
2030Q2E $620M
2030Q3E $661M
2030Q4E $704M
2031Q1E $750M
2031Q2E $800M

Assumptions & reasoning

  • Originations for this line are published on page 14 of the Q2 2026 deck; the revenue is not. It is the Unsecured Lending segment's disclosed fee revenue apportioned on that origination mix, which assumes Core earns the same fee per dollar as the other two unsecured lines.
  • That assumption is the weak point and it cuts against this line. Upstart says super prime carries a LOWER take rate, so a pro-rata split understates Core's share of unsecured revenue and overstates super prime's. The contribution margins carry the difference instead.
  • The sequential path is violent: +34.7%, +1.5%, +6.6%, -0.3%, +26.7%. A base case that extrapolates any single quarter of that is wrong, which is why the growth input sits well below the quarter just delivered.
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