SAN DIEGO–(BUSINESS WIRE)–The class: Shareholder rights law firm Robbins LLP advises investors that a shareholder has filed a class action lawsuit on behalf of all persons and entities who have purchased or otherwise acquired securities of Upstart Holdings, Inc. ( NASDAQ: UPST) between November 9, 2021 and May 9, 2022, for violation of the Securities Exchange Act of 1934. Upstart is a cloud-based artificial intelligence (AI) lending platform.
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What this case is about: Upstart Holdings, Inc. (UPST) Misled Investors About Its Business Prospects
According to the complaint, during the Class Period, the Defendants failed to disclose to investors that Upstart’s AI model could not adequately account for macroeconomic factors such as interest rates that impact on the market clearing price for loans. In addition, the Company suffered a negative impact on its conversion rate and was reasonably likely to use its balance sheet to finance borrowings.
On May 9, 2022, Upstart announced its first quarter 2022 financial results, reducing its guidance for fiscal 2022, forecasting revenue of approximately $1.25 billion and a contribution margin of 48%. During the related conference call, Upstart’s chief financial officer indicated that “the loan, note and residual balance at the end of the quarter was … up to $604 million compared to $261 million in the fourth quarter. “, citing “rising interest rates and rising consumer delinquencies [as] putting downward pressure on conversion. At this news, the company’s stock price fell $43.52, or 56%, to close at $33.61 per share on May 10, 2022.
Next steps: If you acquired shares of Upstart Holdings, Inc. (UPST) between November 9, 2021 and May 9, 2022, you have until July 12, 2022, to ask the court to name you as the lead plaintiff in the class. A lead plaintiff is a representative party acting on behalf of the other class members to direct the litigation. You don’t have to be in the case to be eligible for a clawback.
All representation is done on a contingent fee basis. Shareholders do not pay any fees or expenses.
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