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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_________________________
FORM 10-Q
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2023
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from_________to ________
Commission File Number: 001-39797
https://cdn.kscope.io/e0cf8c9dbda32f8255ac533952d4aab1-2019-Upstart-Logo-Medium copy.jpg
Upstart Holdings, Inc.
(Exact name of registrant as specified in its charter)
_________________________

Delaware
(State or other jurisdiction of
incorporation or organization)
46-4332431
(I.R.S. Employer
Identification No.)
Upstart Holdings, Inc.
2950 S. Delaware Street, Suite 300
San Mateo, California 94403
(Address of principal executive offices, including zip code)
(833) 212-2461
(Registrant’s telephone number, including area code)
_________________________

Securities registered pursuant to Section 12(b) of the Act:
Title of each class:Trading SymbolName of each exchange on which registered:
Common Stock, par value $0.0001 per shareUPSTNasdaq Global Select Market
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
1


Large accelerated filerAccelerated filer
Non-accelerated filerSmaller reporting company
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No
As of August 1, 2023 there were 83,887,658 shares of the registrant’s common stock outstanding.
2


Upstart Holdings, Inc.
FORM 10-Q
TABLE OF CONTENTS
Page
Item 2.
Item 3.
Item 4.
Item 1.
Item 1A.
Item 2.
Item 3.
Item 4.
Item 5.
Other Information
Item 6.
3

Table of Contents
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of the federal securities laws about us and our industry, which statements involve substantial risks and uncertainties. Forward-looking statements generally relate to future events or our future financial or operating performance. In some cases, you can identify forward-looking statements because they contain words such as “may,” “will,” “should,” “expect,” “plan,” “anticipate,” “seek,” “could,” “intend,” “target,” “aim,” “project,” “contemplate,” “believe,” “estimate,” “predict,” “potential,” or “continue,” or the negative of these words or other similar terms or expressions that concern our expectations, strategy, plans, or intentions. Forward-looking statements contained in this Quarterly Report on Form 10-Q include statements about:
our future financial performance, including our expectations regarding our revenue, our operating expenses, our ability to determine reserves and our ability to achieve and maintain profitability;
our ability to improve the effectiveness and predictiveness of our AI models and our expectations that improvements in our AI models can lead to higher approval rates and lower interest rates;
our ability to increase the volume of loans facilitated through our AI lending marketplace;
our ability to successfully maintain a diversified and resilient loan funding strategy, including lending partnerships and whole loan sales and securitization transactions;
our capital allocation plans, including expectations regarding funding loans through our balance sheet and allocations of cash and timing for any share repurchases and other investments;
our ability to maintain competitive interest rates offered to borrowers on our platform, while enabling our lending partners and institutional investors to achieve an adequate return over their cost of funding;
our ability to successfully build our brand and protect our reputation from negative publicity;
our ability to increase the effectiveness of our marketing strategies, including our direct consumer marketing initiatives;
our expectations regarding macroeconomic events, including rising interest and inflation rates and monetary policy changes;
our expectations regarding the credit performance of Upstart-powered loans;
the impact of recent bank failures, including disruption in the banking industry, and any associated effects on our business and industry;
the impact of the COVID-19 pandemic and any associated economic downturn on our business and results of operations;
our expectations and management of future growth, including expanding the number of potential borrowers;
our reductions in workforce announced in November 2022 and January 2023, including our ability to successfully implement such reductions in workforce or achieve the anticipated cost reductions;
our ability to successfully adjust our proprietary AI models, products and services, and provide up-to-date information to our lending partners, in a timely manner in response to changing macroeconomic conditions and fluctuations in the credit market;
our compliance with applicable local, state and federal laws;
our ability to comply with and successfully adapt to complex and evolving regulatory environments, including regulation of artificial intelligence and machine learning technology;
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Table of Contents
our expectations regarding regulatory support of our approach to AI-based lending;
our expectations regarding the success of our strategic investments and acquisitions, including the integration of acquired operations, products, technology, internal controls and personnel;
our expectations regarding new and evolving markets and our ability to enter into new markets and introduce new products and services;
our expectations concerning relationships with third parties;
our ability to protect against increasingly sophisticated fraudulent borrowing and online theft;
our ability to service our loans and pursue collection of delinquent and defaulted loans;
our ability to successfully compete with companies that are currently in, or may in the future enter, the markets in which we operate;
our ability to effectively secure and maintain the confidentiality of the information received, accessed, stored, provided and used across our systems;
our ability to successfully obtain and maintain corporate funding and liquidity to support continued growth and for general corporate purposes;
our ability to attract, integrate and retain qualified employees;
our ability to maintain an effective system of disclosure controls and internal control over financial reporting and operations;
our ability to effectively manage and expand the capabilities of our operations teams, outsourcing relationships and other business operations;
our ability to maintain, protect and enhance our intellectual property;
our expectations regarding outstanding litigation and regulatory investigations; and
our ability to manage the increased expenses associated with being a public company.

We caution you that the foregoing list may not contain all of the forward-looking statements made in this report.

Forward-looking statements should not be relied upon as predictions of future events. We have based the forward-looking statements contained in this report primarily on our current expectations and projections about future events and trends that we believe may affect our business, financial condition, results of operations, and prospects. The outcome of the events described in these forward-looking statements is subject to risks, uncertainties, and other factors, including those described in the section titled “Risk Factors” and elsewhere in this report. Readers are urged to carefully review and consider the various disclosures made in this report and in other documents we file from time to time with the Securities and Exchange Commission that disclose risks and uncertainties that may affect our business. Moreover, we operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time and it is not possible for us to predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this report. We cannot assure you that the results, events, and circumstances reflected in the forward-looking statements will be achieved or occur, and actual results, events, or circumstances could differ materially from those described in the forward-looking statements.

Neither we nor any other person assumes responsibility for the accuracy and completeness of any of these forward-looking statements. Moreover, the forward-looking statements made in this report relate only to events as of the date on which the statements are made. We undertake no obligation to update any forward-looking statements made in this report to reflect events or circumstances after the date of this report or to reflect new information or the occurrence of unanticipated events, except as required by law. Undue reliance should not be placed on our forward-
5

Table of Contents
looking statements as we may not actually achieve the plans, intentions, or expectations disclosed in our forward-looking statements. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures, or investments we may make.

In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based upon information available to us as of the date of this report, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain, and investors are cautioned not to unduly rely upon these statements.

Each of the terms the “Company,” “we,” “our,” “us” and similar terms used herein refer collectively to Upstart Holdings, Inc., a Delaware corporation, and its consolidated subsidiaries, unless otherwise stated.


Table of Contents
PART 1. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
Upstart Holdings, Inc.
Condensed Consolidated Balance Sheets
(In thousands, except share data)
(Unaudited)
December 31,June 30,
20222023
Assets
Cash$422,411 $443,672 
Restricted cash110,056 66,221 
Loans (at fair value)1,010,421 837,565 
Property, equipment, and software, net44,168 47,010 
Operating lease right of use assets86,335 80,349 
Beneficial interests (at fair value) 28,664 
Non-marketable equity securities41,250 41,250 
Goodwill67,062 67,062 
Other assets (includes $42,648 and $47,585 at fair value as of December 31, 2022 and June 30, 2023, respectively)
154,351 151,919 
Total assets(a)
$1,936,054 $1,763,712 
Liabilities and Stockholders’ Equity
Liabilities:
Accounts payable$18,715 $6,937 
Payable to investors90,777 44,049 
Borrowings986,394 930,653 
Accrued expenses and other liabilities (includes $8,820 and $6,927 at fair value as of December 31, 2022 and June 30, 2023, respectively)
66,946 47,689 
Operating lease liabilities100,787 96,239 
Total liabilities(a)
1,263,619 1,125,567 
Stockholders’ equity:
Common stock, $0.0001 par value; 700,000,000 shares authorized; 81,259,676 and 83,811,484 shares issued and outstanding as of December 31, 2022 and June 30, 2023, respectively
8 8 
Additional paid-in capital714,871 838,000 
Accumulated deficit(42,444)(199,863)
Total stockholders’ equity672,435 638,145 
Total liabilities and stockholders’ equity$1,936,054 $1,763,712 
____________
(a)The following table presents information on assets and liabilities related to variable interest entities (“VIEs”) that are consolidated by Upstart Holdings, Inc. at December 31, 2022 and June 30, 2023. The assets in the table below may only be used to settle obligations of consolidated VIEs and are in excess of those obligations. The holders of the beneficial interests do not have recourse to the general credit of Upstart Holdings, Inc. The assets and liabilities in the table below include third-party assets and liabilities of consolidated VIEs and exclude intercompany balances that eliminate in consolidation.

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Upstart Holdings, Inc.
Condensed Consolidated Balance Sheets
(In thousands, except share data)
(Unaudited)
December 31,June 30,
20222023
Assets
Cash$838 $1,650 
Restricted cash13,147 11,435 
Loans (at fair value)958,822 807,165 
Other assets (includes $2,244 and $11,039 at fair value as of December 31, 2022 and June 30, 2023, respectively)
11,674 17,822 
Total assets$984,481 $838,072 
Liabilities
Borrowings$336,452 $279,179 
Accrued expenses and other liabilities1,378 1,547 
Total liabilities337,830 280,726 
Total net assets$646,651 $557,346 


The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
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Upstart Holdings, Inc.
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)
(In thousands, except share and per share data)
(Unaudited)

Three Months Ended June 30,Six Months Ended June 30,
2022202320222023
Revenue:
Revenue from fees, net$258,345 $143,689 $572,327 $260,830 
Interest income and fair value adjustments, net:
Interest income28,974 33,916 44,108 79,231 
Interest expense(2,313)(4,282)(3,272)(11,414)
Fair value and other adjustments(56,844)(37,557)(74,865)(89,954)
Total interest income and fair value adjustments, net(30,183)(7,923)(34,029)(22,137)
Total revenue228,162 135,766 538,298 238,693 
Operating expenses:
Sales and marketing105,212 23,891 238,661 55,329 
Customer operations51,072 36,797 99,479 77,387 
Engineering and product development57,045 57,974 107,036 168,045 
General, administrative, and other46,940 50,448 90,396 103,111 
Total operating expenses260,269 169,110 535,572 403,872 
Income (loss) from operations(32,107)(33,344)2,726 (165,179)
Other income, net2,260 5,197 138 7,794 
Net income (loss) before income taxes(29,847)(28,147)2,864 (157,385)
Provision for income taxes24 18 43 34 
Net income (loss)$(29,871)$(28,165)$2,821 $(157,419)
Net income (loss) per share, basic$(0.36)$(0.34)$0.03 $(1.91)
Net income (loss) per share, diluted$(0.36)$(0.34)$0.03 $(1.91)
Weighted-average number of shares outstanding used in computing net income (loss) per share, basic83,833,963 83,130,638 84,031,109 82,524,403 
Weighted-average number of shares outstanding used in computing net income (loss) per share, diluted83,833,963 83,130,638 94,509,060 82,524,403 


The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
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Upstart Holdings, Inc.
Condensed Consolidated Statements of Stockholders’ Equity
(In thousands, except share and per share data)
(Unaudited)

Three Months Ended June 30, 2022
Common StockAdditional Paid-in CapitalRetained EarningsTotal Stockholders’ Equity
SharesAmount
Balance as of March 31, 202284,676,746 $9 $777,582 $98,913 $876,504 
Issuance of common stock upon exercise of stock options915,412  3,781 — 3,781 
Issuance of common stock upon settlement of restricted stock units99,652 — — — — 
Stock-based compensation expense— — 31,699 — 31,699 
Repurchases of stock(3,503,438)(1)(125,041)— (125,042)
Net loss— — — (29,871)(29,871)
Balance as of June 30, 202282,188,372 $8 $688,021 $69,042 $757,071 


Six Months Ended June 30, 2022
Common StockAdditional Paid-in CapitalRetained Earnings Total Stockholders’ Equity
SharesAmount
Balance as of December 31, 202183,659,665 $8 $740,849 $66,221 $807,078 
Issuance of common stock upon exercise of stock options1,804,373 1 9,406 — 9,407 
Issuance of common stock upon settlement of restricted stock units179,878 — — — — 
Stock-based compensation expense— — 58,376 — 58,376 
Issuance of common stock under employee stock purchase plan47,894 — 4,431 — 4,431 
Repurchases of stock(3,503,438)(1)(125,041)— (125,042)
Net income— — — 2,821 2,821 
Balance as of June 30, 202282,188,372 $8 $688,021 $69,042 $757,071 


Three Months Ended June 30, 2023
Common StockAdditional Paid-in CapitalAccumulated DeficitTotal Stockholders’ Equity
SharesAmount
Balance as of March 31, 202382,600,748 $8 $798,898 $(171,698)$627,208 
Issuance of common stock upon exercise of stock options439,600 — 5,135 — 5,135 
Issuance of common stock upon settlement of restricted stock units771,183 — — — — 
Shares withheld related to net share settlement of restricted stock units(47)— (1)— (1)
Stock-based compensation expense— — 33,968 — 33,968 
Net loss— — — (28,165)(28,165)
Balance as of June 30, 202383,811,484 $8 $838,000 $(199,863)$638,145 


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Upstart Holdings, Inc.
Condensed Consolidated Statements of Stockholders’ Equity
(In thousands, except share and per share data)
(Unaudited)
Six Months Ended June 30, 2023
Common StockAdditional Paid-in CapitalAccumulated DeficitTotal Stockholders’ Equity
SharesAmount
Balance as of December 31, 202281,259,676 $8 $714,871 $(42,444)$672,435 
Issuance of common stock upon exercise of stock options770,693 — 6,672 — 6,672 
Issuance of common stock upon settlement of restricted stock units1,469,356 — — — — 
Shares withheld related to net share settlement of restricted stock units(375)— (6)— (6)
Stock-based compensation expense— — 110,735 — 110,735 
Issuance of common stock under employee stock purchase plan312,134 — 5,728 — 5,728 
Net loss— — — (157,419)(157,419)
Balance as of June 30, 202383,811,484 $8 $838,000 $(199,863)$638,145 




The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
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Upstart Holdings, Inc.
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
Six Months Ended June 30,
20222023
Cash flows from operating activities
Net income (loss)$2,821 $(157,419)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Change in fair value of financial instruments49,103 98,638 
Stock-based compensation55,379 106,705 
Gain on loan servicing arrangement, net(17,732)(6,960)
Depreciation and amortization6,135 10,866 
Non-cash interest expense1,537 1,533 
Other (1,917)
Net changes in operating assets and liabilities:
Purchase of loans held-for-sale(5,922,801)(1,250,346)
Proceeds from sale of loans held-for-sale5,431,635 1,266,604 
Principal payments received for loans held-for-sale66,790 101,829 
Other assets13,196 (3,826)
Operating lease liability and right-of-use asset5,265 1,438 
Accounts payable15,079 (11,786)
Payable to investors(1,886)(50,836)
Accrued expenses and other liabilities(24,959)(17,871)
Net cash provided by (used in) operating activities(320,438)86,652 
Cash flows from investing activities
Purchase of loans held-for-investment(13,876)(83,868)
Proceeds from sale of loans held-for-investment83  
Principal payments received for loans held-for-investment18,524 50,427 
Principal payments received for notes receivable and repayments of residual certificates3,912 2,996 
Acquisition of beneficial interests (26,427)
Purchase of non-marketable equity securities(1,000) 
Purchase of property and equipment(5,578)(1,150)
Capitalized software costs(6,829)(6,324)
Net cash used in investing activities(4,764)(64,346)
Cash flows from financing activities
Proceeds from borrowings261,199 340,370 
Repayments of borrowings(101,613)(397,644)
Proceeds from issuance of common stock under employee stock purchase plan4,431 5,728 
Proceeds from exercise of stock options9,407 6,672 
Taxes paid related to net share settlement of equity awards (6)
Repurchases of common stock(125,042) 
Net cash provided by (used in) financing activities48,382 (44,880)
Change in cash and restricted cash(276,820)(22,574)
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Upstart Holdings, Inc.
Condensed Consolidated Statements of Cash Flows (Continued)
(In thousands)
(Unaudited)
Six Months Ended June 30,
20222023
Cash and restricted cash
Cash and restricted cash at beginning of period1,191,241 532,467 
Cash and restricted cash at end of period$914,421 $509,893 
Supplemental disclosures of cash flow information
Cash paid for interest$4,076 $12,240 
Cash (received) paid for income taxes, net52 (989)
Supplemental disclosures of non-cash investing and financing activities
Beneficial interests included in payable to investors  4,108 
Capitalized stock-based compensation expense$2,997 $4,030 


The following presents cash and restricted cash by category within the unaudited condensed consolidated balance sheets:

December 31,June 30,
20222023
Cash$422,411 $443,672 
Restricted cash110,056 66,221 
Total cash and restricted cash$532,467 $509,893 

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
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Upstart Holdings, Inc.
Notes to Condensed Consolidated Financial Statements
(Tabular Amounts in Thousands, Except Share and Per Share Data and Ratios, or as Noted)
(Unaudited)

 1.    Description of Business and Significant Accounting Policies
Description of Business

Upstart Holdings, Inc. and its subsidiaries (together “Upstart”, the “Company”, “we”, or “our”) apply modern data science and technology to the process of originating consumer credit. The Company helps originate credit, including personal and auto loans, by providing lending partners with access to a proprietary, cloud-based, artificial intelligence lending marketplace. As the Company’s technology continues to improve and additional lending partners adopt the Upstart platform, consumers benefit from improved access to affordable and frictionless credit. The Company currently operates in the United States and is headquartered in San Mateo, California and Columbus, Ohio. The Company’s fiscal year ends on December 31.
Basis of Presentation and Consolidation

The accompanying unaudited condensed consolidated financial statements have been prepared on the same basis as the annual consolidated financial statements included in our Annual Report on Form 10-K. Certain prior period amounts have been reclassified or disaggregated where appropriate to conform to the current period presentation of such amounts. In the opinion of management, the accompanying financial statements reflect all adjustments, which include only normal recurring adjustments, necessary to state fairly the Company’s financial position, results of operations, comprehensive income (loss) and cash flows for the periods presented, but are not necessarily indicative of the results of operations to be anticipated of any future annual or interim periods.

Certain information and disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to rules and regulations of the Securities and Exchange Commission. Accordingly, the information included in this Quarterly Report on Form 10-Q should be read in conjunction with the consolidated financial statements and accompanying notes included in our Annual Report on Form 10-K for the year ended December 31, 2022.
Use of Estimates

The preparation of the unaudited condensed consolidated financial statements in conformity with GAAP requires that management make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods.

Significant estimates and assumptions made in the accompanying condensed consolidated financial statements, which Management believes are critical in understanding and evaluating the Company’s reported financial results include: (i) fair value determinations; (ii) stock-based compensation; (iii) consolidation of VIEs; and (iv) the evaluation for impairment of goodwill. The Company bases its estimates on various factors it believes to be reasonable under the circumstances. Actual results could differ from those estimates and such differences could affect the results of operations reported in future periods.
Derivative Financial Instruments
The Company evaluates its contracts and financial instruments to determine if these contracts and instruments or their parts meet the definition of derivatives in accordance with the requirements of FASB Accounting Codification (ASC) 815, Derivatives and Hedging. Derivatives are recorded on the condensed consolidated balance sheets at fair value with changes in the value recorded in earnings on the condensed consolidated statements of operations and comprehensive income (loss), and are reported within the net cash provided by (used in) operating activities in the condensed consolidated statements of cash flows. The Company uses derivative instruments to manage risks related to our ongoing business operations, including managing interest
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Upstart Holdings, Inc.
Notes to Condensed Consolidated Financial Statements
(Tabular Amounts in Thousands, Except Share and Per Share Data and Ratios, or as Noted)
(Unaudited)

rates on our warehouse facilities. The Company does not employ derivatives for trading or speculative purposes and has no derivatives classified as accounting hedges. Refer to “Note 4. Derivative Financial Instruments” for additional information.

Beneficial Interests

Beneficial interests represent the Company’s right to receive or an obligation to make cash payments to certain loan buyers based on the performance of credit losses of the underlying loan portfolios. The Company evaluates these arrangements to determine if they or their components meet the characteristics of derivative instruments. Beneficial interests that meet such characteristics are reported in accordance with the derivative financial instruments policy. For other beneficial interests that meet the criteria of a debt security, the Company has elected to record the arrangement at fair value and recognize the changes in their fair value in earnings on the condensed consolidated statements of operations and comprehensive income (loss). Refer to “Note 5. Beneficial Interests” for additional information.
Recently Adopted Accounting Pronouncements
        
On January 1, 2023, the Company adopted Accounting Standards Update (“ASU”) 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers, which was issued by the Financial Accounting Standards Board (“FASB”) in October 2021. The new guidance requires contract assets and contract liabilities acquired in a business combination to be recognized and measured by the acquirer on the acquisition date in accordance with ASC 606, Revenue from Contracts with Customers, as if it had originated the contracts. Under the previous business combinations guidance, such assets and liabilities are recognized by the acquirer at fair value on the acquisition date. The ASU will be applied prospectively to business combinations occurring after the adoption date. The adoption of this new standard did not have an impact on the Company's condensed consolidated financial statements or related disclosures.

 2.    Revenue
Revenue from fees, net

The Company disaggregates revenue from fees by type of service for the periods presented as follows:
Three Months Ended June 30,Six Months Ended June 30,
2022202320222023
Revenue from fees, net:
Platform and referral fees, net$211,610 $105,765 $483,422 $183,422 
Servicing and other fees, net46,735 37,924 88,905 77,408 
Total revenue from fees, net$258,345 $143,689 $572,327 $260,830 
Platform and referral fees, net

The Company enters into contracts with lending partners to provide access to a cloud-based artificial intelligence lending marketplace developed by the Company (the “Upstart platform”) to enable lending partners to originate unsecured personal and secured auto loans. The Upstart platform includes a cloud-based application (through Upstart.com or a lending partner-branded program) for submitting loan applications, verifying information provided within submitted applications, risk underwriting (through a series of proprietary technology solutions), delivery of electronic loan offers, and if the offer is accepted by the borrower, electronic loan documentation signed by the borrower. Lending partners can specify certain parameters of loans they are willing to originate. Under these contracts, lending partners can choose to use Upstart’s referral services, which allow them to access new borrowers through Upstart’s marketing channels.
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Upstart Holdings, Inc.
Notes to Condensed Consolidated Financial Statements
(Tabular Amounts in Thousands, Except Share and Per Share Data and Ratios, or as Noted)
(Unaudited)


After origination, Upstart-powered loans are either retained by lending partners, purchased by the Company for immediate resale to institutional investors under loan sale agreements, or purchased and held by the Company. For loans purchased by the Company, Upstart pays lending partners a one-time loan premium fee upon completion of the minimum contractual holding period. Upstart also pays lending partners monthly loan trailing fees based on the amount and timing of principal and interest payments made by borrowers of the underlying loans. Both the loan premium fees and loan trailing fees are consideration payable to customers and are recorded as a reduction to platform and referral fees, net, which is part of revenue from fees, net, in the condensed consolidated statements of operations and comprehensive income (loss). The Company recognized $6.1 million and $14.8 million of loan premium fees and loan trailing fees as contra-revenue within platform and referral fees, net during the three and six months ended June 30, 2022, respectively, and $2.0 million and $3.4 million during the three and six months ended June 30, 2023, respectively.

As of December 31, 2022 and June 30, 2023, the Company recognized $4.9 million and $4.3 million of loan trailing fee liability, respectively, which is recorded at fair value and included within accrued expenses and other liabilities on the Company’s condensed consolidated balance sheets. Refer to “Note 6. Fair Value Measurement” for additional information on changes in fair value associated with trailing fee liabilities.

The Company’s arrangements for platform and referral services typically consist of an obligation to provide one or both of these services to customers, which are our lending partners, on a when and if needed basis (a stand-ready obligation), and revenue is recognized as such services are performed. Additionally, the services have the same pattern and period of transfer, and when provided individually or together, are accounted for as a single combined performance obligation representing a series of distinct services.

Platform and referral services are typically provided under a fixed or variable price per unit based on a percentage of the value of loans originated each period with certain lending partners subject to minimum fees; however, pricing for these services may also be based on usage fees, calculated as a percentage of each loan originated. The nature of the Company’s promise is to stand-ready and provide continuous access to and process transactions through the platform. Platform and referral fees represent variable consideration as loan origination volume is not known at contract inception. These fees are determined each time a loan is originated. Fees for platform and referral services are typically billed and paid on either a daily or monthly basis. As such, the Company’s contracts with customers do not include a significant financing component.

The Company had $31.1 million and $23.0 million of accounts receivable that are included in other assets on the condensed consolidated balance sheets related to contracts with customers as of December 31, 2022 and June 30, 2023, respectively. The standard payment terms on accounts receivable are 30 days. The Company’s allowance for bad debt and bad debt expense were immaterial for the periods presented.

The Company capitalizes incremental costs of obtaining a contract with a customer, which are certain sales commissions paid to employees in connection with the acquisition of lending partners. Capitalized costs are amortized over the expected period of benefit, which we have determined, based on an analysis, to be three years. The Company applies the practical expedient to expense costs to obtain contracts with customers if the amortization period is one year or less. As of December 31, 2022 and June 30, 2023, the Company had a $2.6 million and $2.5 million amount of contract costs, respectively, capitalized within other assets on the condensed consolidated balance sheets. The Company amortized an immaterial amount of capitalized contracts costs to sales and marketing in the condensed consolidated statements of operations and comprehensive income (loss) for the periods presented.

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Upstart Holdings, Inc.
Notes to Condensed Consolidated Financial Statements
(Tabular Amounts in Thousands, Except Share and Per Share Data and Ratios, or as Noted)
(Unaudited)

Customers accounting for greater than 10% of total revenue were as follows:

Three Months Ended
June 30,
Six Months Ended
June 30
2022202320222023
Customer A50%33%48%31%
Customer B28%27%30%28%
Customer C*11%*11%
* Less than 10%

Customers accounting for greater than 10% of accounts receivable were as follows:
December 31,June 30,
20222023
Customer C23%25%


Servicing and other fees, net

The Company also enters into contracts with lending partners and institutional investors to provide loan servicing for the life of Upstart-powered loans. These services commence upon origination of these loans by lending partners and include collection, processing and reconciliations of payments received, institutional investor reporting and borrower customer support as well as distribution of funds to the holders of the loans. The Company charges the loan holder a monthly servicing fee calculated based on a predetermined percentage of the outstanding principal balance. Servicing fees also include certain ancillary fees charged on a per transaction basis for processing late payments and payments declined due to insufficient funds. Servicing fees are recognized in the period the services are provided. Loan servicing fees are not within the scope of ASC 606 and are accounted for under ASC 860, Transfers and Servicing.

Servicing and other fees, net also include gains and losses on assets and liabilities recognized under loan servicing arrangements for loans retained by lending partners or loans sold to institutional investors. Such gains or losses are recognized based on whether the benefits of servicing are expected to be more or less than adequate compensation for servicing obligations performed by the Company. Servicing fees also include changes in fair value of loan servicing assets and liabilities in the periods presented. Refer to “Note 6. Fair Value Measurement” for additional information on changes in fair value associated with servicing assets and liabilities.

The Company recognized a net gain related to loan servicing rights upon loan sales for the periods presented as follows:

Three Months Ended June 30,Six Months Ended June 30,
2022202320222023
Net gain related to loan servicing rights$9,027 $3,347 $17,732 $6,960 

The Company charges lending partners and institutional investors for collection agency fees related to their outstanding loan portfolio. The Company either performs borrower collection activities in-house, or outsources to third-party collection agencies particularly for loans that are more than 30 days past due or charged off. The Company has discretion in hiring the collection agencies and determining the scope of their work. As the principal in the arrangement, the Company recognizes gross revenue from collection agency fees in the period that the services are provided. Upstart also receives certain ancillary borrower fees inclusive of late payment fees and ACH
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Upstart Holdings, Inc.
Notes to Condensed Consolidated Financial Statements
(Tabular Amounts in Thousands, Except Share and Per Share Data and Ratios, or as Noted)
(Unaudited)

fail fees. Revenue from collection agency fees and borrower fees are included in servicing and other fees, net as part of revenue from fees, net in the Company’s condensed consolidated statements of operations and comprehensive income (loss). The total fees charged by collection agencies are also recognized in the period incurred and reported as part of customer operations expenses.

The Company recognized collection agency fees and borrower fees, which are included in servicing and other fees, net for the periods presented as follows:

Three Months Ended June 30,Six Months Ended June 30,
2022202320222023
Collection agency fees$2,565 $3,752 $4,555 $7,668 
Borrower fees$5,890 $6,904 $11,120 $14,641 
Interest Income and Fair Value Adjustments, Net

Interest income and fair value adjustments, net is comprised of interest income, interest expense and net changes in the fair value of financial instruments, held in the Company’s normal course of business at fair value, including derivatives, beneficial interests, loans and notes receivable and residual certificates.

The following table presents components of the interest income and fair value adjustments, net presented in the Company’s condensed consolidated statements of operations and comprehensive income (loss):

Three Months Ended June 30,Six Months Ended June 30,
2022202320222023
Interest income$28,974 $33,916 $44,108 $79,231 
Interest expense(2,313)(4,282)(3,272)(11,414)
Fair value and other adjustments
Unrealized loss, charge-offs, and other adjustments, net(31,477)(26,110)(50,786)(70,654)
Realized loss on sale of loans, net(25,367)(11,447)(24,079)(19,300)
Total fair value and other adjustments, net(56,844)(37,557)(74,865)(89,954)
Total interest income and fair value adjustments, net$(30,183)$(7,923)$(34,029)$(22,137)

Interest income

Interest income is recognized based on the terms of the underlying agreements with borrowers for loans held on the Company’s condensed consolidated balance sheets and is earned over the life of a loan.

Interest income also includes accrued interest earned on outstanding loans but not collected. Loans that have reached a delinquency of over 120 days are classified as non-accrual status and any accrued interest recorded in relation to these loans is reversed in the respective period. The Company does not record an allowance for credit losses on accrued interest receivable. As of December 31, 2022 and June 30, 2023, the Company has recorded $12.8 million and $13.0 million of accrued interest income in loans on the condensed consolidated balance sheets, respectively.


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Upstart Holdings, Inc.
Notes to Condensed Consolidated Financial Statements
(Tabular Amounts in Thousands, Except Share and Per Share Data and Ratios, or as Noted)
(Unaudited)

Interest expense

Interest expense is primarily related to interest recorded on the Company’s borrowings on warehouse credit facilities. Interest expense includes accrued interest incurred but not paid. Accrued interest expenses were immaterial as of December 31, 2022 and June 30, 2023. Interest expense also includes changes in fair value of the interest rate cap, which were immaterial for the three and six months ended June 30, 2023. Refer to “Note 4. Derivative Financial Instruments for additional information.
Fair value and other adjustments, net

Fair value and other adjustments, net include changes in fair value of financial instruments, other than loan servicing assets and liabilities and the interest rate cap. These adjustments are recorded in the Company’s condensed consolidated statements of operations and comprehensive income (loss) and include both realized and unrealized changes to the value of related assets and liabilities. Refer to “Note 6. Fair Value Measurement” for additional information.

Fair value and other adjustments, net also includes amounts received from borrowers for previously charged-off loans held on the Company’s condensed consolidated balance sheets. These amounts are recognized in the period when amounts are received.

 3.    Variable Interest Entities
Consolidated VIEs

The Company consolidates variable interest entities (“VIEs”) in which the Company has a variable interest and is determined to be the primary beneficiary. This determination is based on whether the Company has a variable interest (or combination of variable interests) that provides the Company with (a) the power to direct the activities that most significantly impact the VIE’s economic performance and (b) the obligation to absorb losses or right to receive benefits that could be potentially significant to the VIE. The Company continually reassesses whether it is the primary beneficiary of a VIE throughout the entire period the Company is involved with the VIE.

The Company also determines whether decision-maker or service-provider fees are variable interests. Decision-maker or service-provider fees are not considered variable interests when the arrangement does not expose the Company to risks of loss that a potential VIE was designed to pass on to its variable interest holders, the fees are commensurate, the arrangement is at market, and the Company does not have any other interests (including direct interests and certain indirect interests held through related parties) that absorb more than an insignificant amount of a VIE’s potential variability. This determination can have a significant impact on the Company’s consolidation analysis, as it could affect whether a legal entity is a VIE and whether the Company is the primary beneficiary of a VIE. When the Company’s decision-maker or service-provider fee is not a variable interest, the Company is viewed as acting as a fiduciary for the potential VIE.
Warehouse Entities

The Company established Upstart Loan Trust (“ULT”) and Upstart Auto Warehouse Trust (“UAWT”) to enter into warehouse credit facilities for the purpose of purchasing Upstart-powered loans. Refer to “Note 9. Borrowings” for additional information. The entities are Delaware statutory trusts that are structured to be bankruptcy-remote, with third-party banks operating as trustees.
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Upstart Holdings, Inc.
Notes to Condensed Consolidated Financial Statements
(Tabular Amounts in Thousands, Except Share and Per Share Data and Ratios, or as Noted)
(Unaudited)

Other Consolidated VIE

The Company has formed a number of VIEs for the purpose of holding Upstart-powered loans that are not pledged or eligible to be pledged to the Company’s warehouse credit facilities.

The following tables present a summary of financial assets and liabilities from the Company’s involvement with consolidated VIEs:

AssetsLiabilitiesNet Assets
December 31, 2022
Total consolidated VIEs$984,481 $337,830 $646,651 

AssetsLiabilitiesNet Assets
June 30, 2023
Total consolidated VIEs$838,072 $280,726 $557,346 

Unconsolidated VIEs

The Company’s transactions with unconsolidated VIEs include securitizations of unsecured personal whole loans and sales of whole loans to VIEs. While the Company continues to be involved with the unconsolidated VIEs in its role as the sponsor and the servicer of securitization transactions, the Company does not hold a significant economic interest in these entities and has determined that it is not the primary beneficiary of these entities. The Company’s unconsolidated VIEs include entities established as the issuers and grantor trusts for various securitization transactions.

In cases where the VIEs are not consolidated and the transfer of the loans from the Company to the securitization trust meets sale accounting criteria, the Company recognizes a gain or loss on sales of loans. The net proceeds of the sale represent the fair value of any assets obtained or liabilities incurred as part of the transaction. The assets are transferred into a trust such that the assets are legally isolated from the creditors of the Company and are not available to satisfy obligations of the Company. These assets can only be used to settle obligations of the underlying securitization trusts.

The following tables summarize the aggregate value of assets and liabilities of unconsolidated VIEs in which the Company holds a variable interest but is not the primary beneficiary:

AssetsLiabilitiesNet AssetsMaximum Exposure to Losses
December 31, 2022
Securitizations and other$364,013 $265,040 $98,973 $13,311 

AssetsLiabilitiesNet AssetsMaximum Exposure to Losses
June 30, 2023
Securitizations and other$264,922 $188,210 $76,712 $11,036 

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Upstart Holdings, Inc.
Notes to Condensed Consolidated Financial Statements
(Tabular Amounts in Thousands, Except Share and Per Share Data and Ratios, or as Noted)
(Unaudited)

The Company’s maximum exposure to loss from its involvement with unconsolidated VIEs represents the estimated loss that would be incurred under severe, hypothetical circumstances, for which the Company believes the possibility is remote. The carrying value of assets that relate to variable interests in unconsolidated VIEs consists of $6.2 million and $3.9 million of securitization notes and residual certificates which are included in other assets on the condensed consolidated balance sheets as of December 31, 2022 and June 30, 2023, respectively. The Company also had $7.1 million of cash deposits made to reserve accounts for related securitizations, included in other assets on the condensed consolidated balance sheets as of December 31, 2022 and June 30, 2023.

For securitization transactions where the Company is not the risk retaining sponsor, and servicing is the only form of continuing involvement, the Company would only experience a loss if it were required to repurchase such a loan due to a breach in representations and warranties and is not able to collect all repayments, refer to “Note 12. Commitments and Contingencies” for further information.

The investors and the securitization trusts have no direct recourse to the Company’s assets, and holders of the securities issued by the securitization trusts can look only to the assets of the securitization trusts that issued their securities for payment. The beneficial interests held by the Company and its affiliates are subject principally to the credit and prepayment risk stemming from the underlying unsecured personal whole loans.


 4.    Derivative Financial Instruments

In February 2023 and June 2023, UAWT and ULT entered into interest rate cap agreements with a strike rate of 3.0% and 3.25%, respectively. The agreements were entered into in relation to the warehouse credit facilities which bear floating interest rates, refer to “Note 9. Borrowings” for further information. The interest rate caps provide protection to the credit facilities against exposure to changes in cash flows to the extent the underlying interest rate on the facility exceeds the strike rate. The UAWT interest rate cap matures in April 2029 and the ULT interest rate cap matures June 2025. The interest rate cap agreements meet the definition of a derivative and are reported at fair value. Refer to “Note 6. Fair Value Measurement” for additional information.

The following table presents the notional amount as well as the fair value of interest rate caps, which is reported as part of other assets on the condensed consolidated balance sheets. There were no material derivative financial instruments held by the Company as of December 31, 2022.

June 30, 2023
Notional AmountFair Value
Interest rate caps$333,047 $10,339 

The Company recognizes changes in fair value of these instruments in earnings and reports them as part of the interest expense on the condensed consolidated statements of operations and comprehensive income (loss). The table below presents gains recognized on the interest rate caps during the following periods:

Three Months Ended June 30,Six Months Ended June 30,
2022202320222023
Fair value gains on interest rate caps$ $2,309 $ $1,045 



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Upstart Holdings, Inc.
Notes to Condensed Consolidated Financial Statements
(Tabular Amounts in Thousands, Except Share and Per Share Data and Ratios, or as Noted)
(Unaudited)

 5.    Beneficial Interests

In connection with certain committed capital agreements, the Company has risk sharing arrangements in which it is obligated to make payments to the loan buyer or is entitled to receive payments from the loan buyer if credit losses on the underlying loans subject to the arrangements deviate from initial expectations, subject to a dollar cap. The Company has beneficial interests in these arrangements which either meet the definition of a derivative or that meet the criteria of a debt security. As of June 30, 2023 the Company’s capital at risk, which represents the maximum exposure to losses, under these arrangements was $40.2 million.

The following table presents the aggregate unpaid principal balance of the underlying portfolio as well as the fair value of beneficial interests, which are presented as a separate asset line item on the condensed consolidated balance sheets. As of June 30, 2023, beneficial interest liabilities were immaterial. There were no beneficial interests held by the Company as of December 31, 2022.

June 30, 2023
Unpaid Principal BalanceFair Value
Beneficial interests
$742,988 $28,664 

The Company recognizes these beneficial interests at fair value with changes reported as part of the fair value and other adjustments on the condensed consolidated statements of operations and comprehensive income (loss). The table below presents losses recognized on beneficial interests during the following periods:

Three Months Ended June 30,Six Months Ended June 30,
2022202320222023
Fair value losses on beneficial interests
$ $(1,956)$ $(1,956)

Refer to “Note 6. Fair Value Measurement” for additional information.

 6.    Fair Value Measurement

The following table presents assets and liabilities measured at fair value and categorized in accordance with the fair value hierarchy:
December 31,June 30,
Level 20222023
Assets
Loans3$1,010,421 $837,565 
Notes receivable and residual certificates36,181 3,907 
Loan servicing assets336,467 33,339 
Interest rate caps(1)
2 10,339 
Beneficial interests3 28,664 
Total assets$1,053,069 $913,814 
Liabilities
Loan servicing liabilities3$3,968 $2,577 
Trailing fee liabilities34,852 4,265 
Total liabilities$8,820 $6,842 
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Upstart Holdings, Inc.
Notes to Condensed Consolidated Financial Statements
(Tabular Amounts in Thousands, Except Share and Per Share Data and Ratios, or as Noted)
(Unaudited)

(1)The fair value of interest rate caps is determined based on the present value of the estimated future cash flows over the contract term using observable market-based inputs as of the valuation date, including implied interest rates.

Financial instruments are categorized in the fair value hierarchy based on the significance of unobservable factors in the overall fair value measurement. Since the Company’s loans, notes receivable and residual certificates, loan servicing assets and liabilities, beneficial interests, and trailing fee liabilities do not trade in an active market with readily observable prices, the Company uses significant unobservable inputs to measure the fair value of these assets and liabilities.

There were no transfers between Level 1, Level 2 or Level 3 of the fair value hierarchy during the periods presented.
Loans

Loans included in the Company’s condensed consolidated balance sheets are classified as either held-for-sale or held-for-investment based on the Company’s intent and ability to sell the loans prior to maturity. From time to time the Company transfers loans between classifications based on changes in the Company’s intent. As of December 31, 2022, $882.8 million and $127.6 million of loans held on the Company’s condensed consolidated balance sheets were classified as held-for-sale and held-for-investment, respectively. As of June 30, 2023, $689.9 million and $147.7 million of loans held on the Company’s condensed consolidated balance sheets were classified as held-for-sale and held-for-investment, respectively.
Valuation Methodology

Loans held-for-sale and held-for-investment are measured at estimated fair value using a discounted cash flow model. The fair valuation methodology considers projected prepayments and historical defaults, losses and recoveries to project future losses and net cash flows on loans. Net cash flows are discounted using an estimate of market rates of return. The fair value of these loans also includes accrued interest.

Significant Inputs and Assumptions

The following table presents quantitative information about the significant unobservable inputs used for the Company’s Level 3 fair value measurements for loans held-for-investment and held-for-sale:
December 31, 2022June 30, 2023
MinimumMaximum
Weighted-Average (2)
MinimumMaximum
Weighted-Average (2)
Discount rate6.36 %22.28 %11.87 %9.87 %22.82 %12.06 %
Credit risk rate (1)
0.01 %93.09 %16.93 %0.01 %92.98 %17.04 %
Prepayment rate (1)
0.08 %93.43 %40.49 %0.02 %93.43 %38.74 %
(1)Expressed as a percentage of the original principal balance of the loans
(2)Unobservable inputs were weighted by relative fair value

Discount rates–The discount rates are rates of return used to discount future expected cash flows to arrive at a present value, which represents the fair value. The discount rates used for the projected net cash flows are the Company’s estimates of the rates of return that market participants would require when investing in these financial instruments with cash flows dependent on credit quality of the related loan. A risk premium component is implicitly included in the discount rates to reflect the amount of compensation market participants require due to the uncertainty inherent in the instruments’ cash flows resulting from risks such as credit and liquidity.

Credit risk rates–The credit risk rates are an estimate of the net cumulative principal payments that will not be repaid over the entire life of a financial instrument. The credit risk rates are expressed as a percentage of the
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Upstart Holdings, Inc.
Notes to Condensed Consolidated Financial Statements
(Tabular Amounts in Thousands, Except Share and Per Share Data and Ratios, or as Noted)
(Unaudited)

original principal amount of the instrument. The estimated net cumulative loss represents the sum of the net losses estimated to occur each month of the life of the instrument, net of the average recovery expected to be received.

Prepayment rates–Prepayment rates are an estimate of the cumulative principal prepayments that will occur over the entire life of a loan as a percentage of the original principal amount of the loan. The assumption regarding cumulative prepayments impacts the projected balances and expected terms of the loans.

The above inputs are similarly used in estimating fair value of related financial instruments. Refer to the Assets and Liabilities related to Securitization Transactions section below for additional information.

Significant Recurring Level 3 Fair Value Input Sensitivity

The following table presents the sensitivity of the loans held-for-sale and held-for-investment to adverse changes in key assumptions used in the valuation model as of December 31, 2022 and June 30, 2023, respectively.

December 31,June 30,
20222023
Fair value of loans$1,010,421 $837,565 
Discount rates
100 basis point increase(11,979)(9,752)
200 basis point increase(23,720)(19,314)
Expected credit loss rates on underlying loans
10% adverse change(11,927)(10,152)
20% adverse change(23,852)(20,302)
Expected prepayment rates
10% adverse change(2,284)(2,108)
20% adverse change(4,530)(4,209)

Rollforward of Level 3 Fair Values

The following tables include a rollforward of the loans classified within Level 3 of the fair value hierarchy:
Loans Held-for-
Sale
Loans Held-for-InvestmentTotal
Fair value at March 31, 2022$597,981 $ $597,981 
Reclassification of loans(6,113)6,113  
Purchases of loans682,575 13,876 696,451 
Sale of loans(583,918) (583,918)
Purchase of loans for immediate resale1,782,442  1,782,442 
Immediate resale of loans(1,782,442) (1,782,442)
Repayments received(54,549)(1,038)(55,587)
Changes in fair value recorded in earnings(32,319)(487)(32,806)
Other changes1,662 (20)1,642 
Fair value at June 30, 2022$605,319 $18,444 $623,763 
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Upstart Holdings, Inc.
Notes to Condensed Consolidated Financial Statements
(Tabular Amounts in Thousands, Except Share and Per Share Data and Ratios, or as Noted)
(Unaudited)

Loans Held-for-
Sale
Loans Held-for-InvestmentTotal
Fair value at December 31, 2021$142,685 $109,792 $252,477 
Reclassification of loans103,679 (103,679) 
Purchases of loans1,125,765 13,876 1,139,641 
Sale of loans(634,682) (634,682)
Purchase of loans for immediate resale4,797,036  4,797,036 
Immediate resale of loans(4,797,036) (4,797,036)
Repayments received(84,275)(1,038)(85,313)
Changes in fair value recorded in earnings(51,830)(487)(52,317)
Other changes3,977 (20)3,957 
Fair value at June 30, 2022$605,319 $18,444 $623,763 
Loans Held-for-
Sale
Loans Held-for-InvestmentTotal
Fair value at March 31, 2023$839,482 $142,747 $982,229 
Purchases of loans448,773 41,378 490,151 
Sale of loans(550,860) (550,860)
Purchase of loans for immediate resale291,570  291,570 
Immediate resale of loans(291,570) (291,570)
Repayments received(47,302)(22,583)(69,885)
Changes in fair value recorded in earnings866 (15,011)(14,145)
Other changes(1,108)1,183 75 
Fair value at June 30, 2023$689,851 $147,714 $837,565 
Loans Held-for-
Sale
Loans Held-for-InvestmentTotal
Fair value at December 31, 2022$882,810 $127,611 $1,010,421 
Purchases of loans569,388 88,579 657,967 
Sale of loans(618,392) (618,392)
Purchase of loans for immediate resale680,959  680,959 
Immediate resale of loans(680,959) (680,959)
Repayments received(108,803)(43,455)(152,258)
Changes in fair value recorded in earnings(34,564)(27,742)(62,306)
Other changes(588)2,721 2,133 
Fair value at June 30, 2023$689,851 $147,714 $837,565 
The following table presents the aggregate fair value and aggregate principal outstanding of all loans and loans that were 90 days or more past due included in the condensed consolidated balance sheets:
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Upstart Holdings, Inc.
Notes to Condensed Consolidated Financial Statements
(Tabular Amounts in Thousands, Except Share and Per Share Data and Ratios, or as Noted)
(Unaudited)

LoansLoans > 90 Days Past Due
December 31,June 30,December 31,June 30,
2022202320222023
Outstanding principal balance$1,047,714 $872,469 $9,006