Hi, everyone. I'm Trey Brown. I work together with Jill Carey Hall on our U.S. small and mid-cap strategy team within BofA Global Research. We have a few sessions going on concurrently, but Jill and I just wanted to welcome everyone to our two -day annual SMID Cap Executive Insights event, which provides opportunities to hear from corporates across the small and mid-cap space, where BofA has great breadth of coverage. Our analysts cover nearly 1,000 small and mid-caps in the U.S., and Jill and I have also been expecting continued leadership from some mid-caps in the back half of this year. Please feel free to reach out if you need the schedule or want to sign up for any additional sessions today or tomorrow. We have nearly 20 companies joining. Or if we can help signing you up for either our small and mid-cap strategy research or our data compilation of mid-cap fundamental research. With that, I'd like to pass it over to Mihir Bhatia, our consumer finance analyst, to introduce Upstart Holdings. Thanks, Trey. Thanks, everyone, for joining, and especially to the Upstart team and Paul. Really appreciate you guys joining us today. Before we get started, one quick disclosure statement that I've been asked to read. Today's discussion may contain forward-looking statements that relate to future results and events, which are based on Upstart's information available as of today and are subject to risks and uncertainties. Actual results may differ materially from these forward-looking statements. The discussion may also include non-GAAP financial measures, which are no t a substitute for GAAP results. Please refer to the company's filings with the SEC and its IR website for additional information, including GAAP to non-GAAP reconciliations, along with other disclosures. Okay, with that out of the way, the lawyers should be happy, so we can get started. Again, like I said, a lot of you already know Upstart. I think I recognize most of the names of the folks joining, but we'll go through, I think right at the start, we'll ask Paul to give us a quick overview of the company. Before that, again, just want to say thank you to Paul and the Upstart team for doing this conference with us today and for the opportunity to host you all today. So thank you, Paul, for joining, and let's get started. Maybe I'll just kick it off with that, Paul. You've been with Upstart right from the start, 14 years now, I think. You recently took over as CEO. Maybe for the benefit of anyone who is newer to the story, just give us the quick 90-second version of what Upstart is today. Then I think the part that matters for investors, that excites investors, why does this business compound for 35% over the next few years? Yeah. Really short tagline would be AI for consumer lending. We operate a marketplace business where consumers can go and shop for offers of credit. We do personal loans, auto loans, HELOCs. Really, over time, we will offer the entire suite of consumer c redit products. Our real strategy from the beginning has been to say, "Hey, there is a whole bunch of transformative technology innovation happening around how we use models to make better predictions and understand patterns and data." But that innovation has largely not made its way into consumer lending, which is arguably the most important place for it to go. Because if you think about the history of consumer lending, this is the world's oldest industry. Almost everybody borrows at some point in time. Actually, surprisingly, a large number of people, depending on your exact metric of preference, something like 50% or more of people in the U.S. we think are underserved in how they access credit. Either it costs too much, they can't get approved, it takes too long, and it is all fundamentally because the ability of the models and the lending companies to understand their risk is too limited. So what we have done over time is we have built models that can both better understand the risk, which we call better risk separation, and automate away a bunch of the proc ess. As a result, we are able to radically reduce the cost and complexity of credit for everyday Americans who are looking to borrow, and that is just about everybody. Great. Maybe just on the second part of that question, though, why is this going to be growing at a very high rate for the next few years? Yeah. It is exactly those two things I said. One, this is an industry that is relevant to almost everybody. The addressable market here is enormous. It is almost laughably large if you try to do any kind of math against it. At the same time, usually industries that are that big are really saturated, really well addressed, all the sort of innovations have already gotten plugged in, and that is just not the case in the consumer le nding world, which I think for various reasons historically has tended to move slowly in adopting new technologies. We really have been, for a number of years here, the first, and we think we have quite a large lead in taking a lot of the innovation happening in AI and applying it to this space. We think it is one of the best possible applications there is for AI to do good and serve the consumer. I think you put those things together, disruptive technology transformation against a huge market that has not really fully ingested that disruption, and I think naturally you are going to get a business that has the ability to compound for a very long time. Got it. I do want to dig in on that advantage that you all have, but we will get to that in a few minutes. Before that, I did want to just highlight that while you have been with the company a long time, you just recently took over as CEO in the last few months. I think when you took over, one of the last few weeks, I think I was reading, you have called it the second leg of the race, right? Taking over as CEO. Maybe just talk about that a little bit. Specifically, I think one question we get from investors is, "Well, Paul has been there a while. What is really changing?" Maybe talk a little bit about what investors can expect in terms of changes. What is going to be different under Paul than maybe under Dave? Yeah. Yeah. Obviously, Dave and I worked together in close partnership for a long time. We started this business, as you said, 14 years ago. The thing about this business is that it surprised us in how long it took to build. At first, I think when we started, we thought, "Oh, we w ill just do this, and within a few years, everybody is going to be chasing us on this same race of applying AI to credit, realizing how large the opportunity is." I think we have just been consistently surprised how slowly that has taken to happen. I think it's actually for a lot of the reasons that it took us so long to build the sort of first, what we call the first leg of the race, which has a lot to do with the fact that consumer credit, maybe credit in general, but certainly consumer credit, obviously it's highly regulated. It's an industry that has a lot of entrenched ways of doing things. If you think about what does it take if you're going to say, "Hey, we have this completely new way of understanding credit risk," what do you need to do to actually make that a market reality and do that at scale? Well, it turns out you need a whole bunch of different kinds of very old institutions to buy in, right? You need rating agencies to understand the risk of this stuff, so they can rate these things in a sort of risk-appropriate way. That unlocks financing for capital partners. The capital partners themselves, of course, have to buy in. Regulators have to understand it, banks, et cetera. You have all of these different kinds of institutions that really sort of form this network around maybe the traditional way of understanding consumer risk. We came in and said, "Hey, we have this completely different way of doing things. Never mind that this person's FICO score may look like this or that." It took actually a bunch of years to overcome that because then once these people buy in, then you are able to start making the loans. Then the loans themselves take two, three, four years to prove themselves as actually good performing loans. Guess what? The reality is the first time you build a model, it's not going to be very good. The first model's going to have a few things it gets wrong, and then you're going to have to tune that model, and guess what? Then you have to start that 2-4 year clock again. It ended up taking us really the better part of a decade to really get the sort of first leg of the race done, where we'd really built the foundation for the company, which was we acquired really valuable proprietary data. We talk about this in terms of rows and columns of data that the company uniquely has, where we gathered thousands of columns of data about people's characteristics at time of taking out a loan. Then we had millions of rows of repayment data, and it's that sort of matrix that actually allows you to train the types of models that we've developed. Of course, we had many years where we actually developed proprietary algorithms to understand the patterns in that data. Those two things work together, high volume of data, high complexity of algorithms. You really can't have one without the other. That was on the technology side. At the same time, we had to build up the sort of credibility with institutional capital markets, the rating agencies, the regulators, to really believe that this is something that can work and to see the evidence and prove it out. Those two things took a really long time, and we finally got to this place where we said, "Okay, it's indisputable at this point that this is just a better way to lend, that if you do this, then you get a tremendous accuracy advantage that unlocks either much higher approval rates at the same loss rates or equivalently much lower loss rates at the same approval rate." That's something that we think we proved in phase one of the company. Of course, we took the company public. We built an incredible team that's able to operate this business with leverage and scale. We started taking the same idea and going, "Hey, we're not just going to do this in unsecured personal loans," which was our first product. We're going to do this in every category of credit that's relevant to the consumer." We rolled it out across auto and home and short-term lending. That's where the company sat at the moment of transition, and that's why we called it the leap from the first leg of the race to the second leg of the race. In the second leg of the race, I think we have exactly the foundation that we need for the company. Now it's about really tactically and strategically applying it to the right places at the right time. The very first thing that I prioritized in 2026 was I said, "Well, if you look at the state of the business today, you look at the stock price today, one thing that's very clear is that the business is operating with an inordinately high cost of capital implicit in the stock price where investors and the market just sort of is skeptical that this is a business that can sustainably deliver high rate of profit growth." We said, "Well, actually, the market is wrong about that, and we know just the way to fix that." Instead of saying we're going to invest in every possible thing we could do at once, we streamlined the company priorities down to a very short list, very centered around what we call contribution profit, which is our single best measure of the operating progress of the business. We delivered exactly that in Q2, and you can sort of see it in our results. We said, "Well, first thing we're going to show you is that in our core personal loans business, we don't have any kind of intensifying competitive threat or declining margins or any kind of structural compression there." Actually, this has just not been our number one focus for a little bit, and now it is. We did 3.5x the growth of the prior three quarters put together in a single quarter. That drove then a massive increase in our contribution profits. We got to record contribution profits in Q2 that surpassed Q4 of 2021 back when macro conditions were much more generous in 2021, of course, than now in 2026, whether you're looking at interest rates or consumer default levels. I mean, just sort of night and day difference. We still did record contribution profits in Q2 of 2026. Secondly, we said was, well, we have a few new products that we are really excited about. In the last few quarters, we have proven that these products have real borrower demand, they have investor demand. But we have not really shown that these products are going to be profitable, good businesses for Upstart. So we said, let's make the number one priority of these teams to get to contribution profitable in these segments, these are home and auto. So, in Q2, w e expanded their contribution margins by 61 percentage points. They are not all the way there, but they are well on their way to getting towards contribution profitable. We have said that we are going to be there by the end of this year. That has been really, really strong. Then I think the last sort of big question has been, is this going to be a business that just structurally, constantly needs more equity capital in order to support the balance sheet or make the whole business work? Q2, I think, was also a really good proof point on that question, which is we did 23% sequential growth. 23% growth in originations in a single quarter is like $760 million. That is way higher than the sort of normalized rate of growth that I think most people would be ecstatic about in the business. We did that while predominantly funding that with third-party funding. Our balance sheet loans declined to almost a two-year low in terms of the percent of total outstanding loans. So really, I think just a quarter where we were really hyper-focused on proving to the market that this is a business where you can expect all of the sort of underlying businesses to have really strong margins because their underlying tech differentiation is very strong for that to be able to grow at a nice rate and for us to do so in a very capital efficient manner. Got it. No, that is interesting, and particularly on 2Q results. One thing that struck us on 2Q results, I mean, there is a few, I would say, highlights in the results. You mentioned the unsecured margin improving so much, but what was also interesting was the growth in core personal loans. I think you are 27% sequentially. The growth was probably, I think it was faster than the prior three quarters combined. Now to be fair, you had called it out in 1Q, but I did want to dig in a little bit on that, maybe just bridge for us. How much of it was the model and the funnel improving versus you are just much more focused on driving that product and marketing investments in that product? Some of it was, of course, a little bit easier comp. What drove that big improvement in 2Q, and what should we expect for 3Q with core personal loans? Yeah, I do think ultimately it's all downstream of management focus. I think the different categories of why it grew are really not so different in our mind. As a reminder, the number one way that our business grows is we invest in better funnel, and that can be better models, better user experience, more automation. Those are, to us, sort of all ways of doing roughly the same thing, which is increasing the percentage of people that convert holding constant the applicant pool. At the same time, of course, the applicant pool is not fixed. We're always putting effort into growing the number of consumers that we have relationships with, the number of consumers that know about Upstart, the number that are coming to us. If you think about you always, every single quarter, have these trade-offs you're making and which pockets are you going to focus on. I think in the preceding year, we had been a little more focused in some other segments. We had been a little more focused maybe on going kind of broader. In Q2, we were extremely focused on this core segment because it's a segment that we have such strong margins in, we have such a strong level of differentiation in, and we just wanted to prove and make clear that, with a little bit of focus on this, there wasn't any kind of fundamental change in the size of our advantage or compression in the margins. It was just actually a thing of if we focus on this, then it's going to grow a lot, and that the sort of untapped opportunity here is just very large. I think that was disproportionate maybe in Q2, but we certainly will continue to focus on this as a strategy because it's just such a good way for the business to generate contribution profits, and contribution profits kind of pay for everything else we want to do. Right. I guess maybe if I will push you a little bit on that exactly where you ended, right? If you continue to focus on it and it has such a large market, you can drive a lot of contribution margin, which lets you invest in the rest of the business. Why not push even harder on this and really generate the cash flow, if you will, to help you invest in the rest of the business? I guess where is the choice between investing in growth of other products versus investing in more of your time in just driving personal loans? Take us through that decision. When Paul sits there and looks at it, how does he say, "Well, that is enough for that. We need to feed or water," whatever analogy you want to use, some of the other products, too? Yeah. It is an evergreen debate at Upstart. We probably could go even harder in core personal loans, and I think that would start to come at a pretty significant expense to our new product growth and our ability to invest there. Ultimately, we are like, well, you do not want to just solve for the very long term. Maybe if you just solve for the very long term and you do not worry about anything in the short- term, then you are just going to invest a ton, and it is going to take a long time to show profitability. If you only invest in the very short term, then I think you are just never going to reach your potential as a business. To me, you have to land somewhere in between, and you have to do it in a way that is mindful of what your implied cost of capital is and how much sort of credibility with investors and markets, and we hope to earn more and more of that over time. I think certainly, there are businesses that have earned the right to invest more aggressively and invest for a longer duration, and we hope to be th ere one day. But I think I am just cognizant of the fact that today, the reality of our implied cost of capital is very high. I always say, "Well, there are these really great investments. Maybe this will pay off in five years or something." That is really nice and if you do the math on that and you put it in a model, it says that your IRR on that is really good. But then I look at the stock price, I am like, "Oh, well, what I think the implied IRR on the stock price is even higher than that." Those are, I think, some of the questions that go through my head in terms of thinking about how far out we should be investing. We want to be really smart, really rational capital allocators in how we think about those decisions. I do think we are landing in a place that is a good in between, where we are, I think, going to do a really nice job of continuing to grow our profitability as a business. At the same time, we are keeping open the entire addressable market of this business over our relevant lifetime. I am not super old, but I also like not going to wait around for the rest of my life for us to achieve the whole market opportunity here. I think that is kind of the balance we are trying to strike. Sure. I think one thing that really impressed or struck a lot of investors in Q2 is the sharp improvement in contribution margin for some of the secured products. I think you mentioned it earlier, also 61 percentage points of improvement right there in contribution margin. Can you talk a little bit about that? What clicked? Why is this suddenly seeing this hockey stick almost, if you will, growth in contribution margin? Is it just a matter of these products are now at scale and have found their product market fit, if you will? What should we expect from here beyond Q4 where you are getting to break even? What do the contribution margins of this product look like at scale? Yeah. So both home and auto in the preceding quarters had really achieved what I think was the first steps in building out a new product, which is proving that borrowers want this thing, proving that investors want this thing, real marketplace that works. It was time for these products to prove the next thing, which is that these are things that can actually make money and be good businesses for us. We really fairly sharply turned the focus of these teams over the last few months to be your number one goal is to get to contribution profitable. We do not care how much you grow the business, then your number one goal is no longer proving demand. It is now proving unit economics. That just reshuffles the order of things that you are going to be doing.</seg <seg id="3">Of course, a bunch of things help both, but if you think about what has to happen for these businesses to have good unit economics, well, you have got to do some optimization of costs. These really matter in secured products. If you look at HELOC has pretty significant costs when it comes to verifying an applicant for a loan, much more than personal loans. Levels of automation are much lower, and the just number of things that you could possibly automate is just so much more when you have to deal with liens and all of that. Of course, a bunch of things help both, but if you think about what has to happen for these businesses to have good unit economics, well, you've got to do some optimization of costs. These really matter in secured products. If you look at HELOC has pretty significant costs when it comes to verifying an applicant for a loan, much more than personal loans. Levels of automation are much lower, and the just number of things that you could possibly automate is just so much more when you have to deal with liens and all of that. A lot more focus on the cost side of it, then also a lot more focus on optimizing our take rates, which in new products tend to be totally unoptimized, where the starting point is just like, you just pick some kind of slightly arbitrary flat fee and just charge it equally on everything. Really, if you compare that to what we do in, say, personal loans, there's a big difference. In personal loans, we have intelligence when it comes to knowing which offers we are adding a lot of value to the consumer in, which ones we're only adding a little bit of value, trying to set our take rates in proportion how much value we're creating. There's a very similar thing going on now in some of these businesses where if you take auto as an example, there's just a huge amount of variation in the dealership. Some deals, we're uniquely the only offer, the only way you're going to buy this car is with an Upstart loan because no one else can understand that risk. Then there are other deals where it's a fiercely competitive free market, and in that case, it just doesn't make sense to try to take the same amount of economics in each case. We're just starting to get smart to that and optimize around our take rates. Those will continue to be dimensions that we optimize along. I've said a few times that is going to be both a fast story and a slow one in the sense that I think there's going to be this very fast ramp to contribution profitable. We're very focused on it. It's our number one priority. Then it's not like we're going to be done. If you look at our personal loan margins, they continue to expand for years and years after that product was mature, and that should just come as a function of how much value we create. That's ultimately what I care about doing in this business is I want consumers to get a delightful product, something that saves them a ton of money compared to the next best option. I want us to make more money as we save people more money. I don't want to try to take too much all at once upfront. I think that can be a pretty bad trap for these sorts of businesses where you say, "Well, I'm your best offer, so I'm just going to take every last dollar on the table." I want to always leave plenty of money for the consumer on the table. Then as the amount of money that we bring to the table grows, we can keep an increasing amount of it. So that's something that I think will play out more slowly over the years. Got it. We are about halfway through, so just wanted to flag for any of the listeners, if you have any questions, you can raise your hand or shoot me a Bloomberg or email, and I am happy to ask it on your behalf. Or if you want to just raise your hand, we can call on you. One question that I know we will get, just because I have gotten it a ton, is around UMI, the increase in UMI to the top end of your. I think for this year, the guidance is you had assumed 1.4 - 1.5. UMI is probably close to the top end of that range, but you have held your guidance. I guess what is the offset? What is helping you come in within your full year guidance despite UMI being higher? At what level of UMI does the math stop working and force a revisit either to medium-term or short-term guide? We have shared that every 5 points of change in UMI is worth 5%-10% in relative size of originations, which tends to be pretty proportional to everything else, kind of revenue and contribution profits. If you do the math on that, it is a pretty sizable effect. I think if we were in the lower mid-part of the UMI range for the year that we thought we might be in, probably we would have been raising guidance. I think that is because we had a pretty extraordinary Q2 in terms of execution on what is in our control. We control our ability to build better models. We control our ability to build better user experiences, more automation, reach more customers, and all of those things I think we have done exactly the right things on, prioritized exactly the right areas and businesses, and I think the results show that. I think, if not for the rise in UMI, I think we probably would have landed in a pretty different spot on guidance. As it is, I think we look at those two things and say, well, there is kind of a great execution on the one hand, and sailing against a bit of a macro headwind on the other, and those kind of net out. So that is how we landed where we did on guidance. Of course, we also want to make sure that the bar for making any changes to guidance is just high. And we always want to make sure that people understand that if we're going to affirmatively come out and say something, we really mean it, and we have a lot of confidence behind that statement. Got it. I actually see a couple of hands up already. Luke, why don't we go to you first? And then Jeremy, we'll come to you next. Luke, if you want to go ahead. Yeah. Great. Thanks. Can you hear me okay? Yes. Okay, great. Thank you guys for doing this. I have a couple of quick questions. The first is just on kind of the commentary on the focus on the core in 2Q. Obviously, you put a lot of emphasis on it, and it was really strong growth year-over-year. It sounds like that was a big push for you guys through the first half, and then the second half is kind of getting to contribution profit neutral. I think it was breakeven by 4Q in the secured product. Should we basically say that the growth rate that we saw in the core personal should flatten out into the back half of the year? Or as we look into next year and obviously beyond, how should we think about the sustainability of the growth rate on the unsecured versus the secured? Because obviously, getting to contribution profit margin breakeven on the secured side will, rising tide lifts all boats on the overall contribution profit dollars. Yeah. Our kind of strategic focuses and priorities aren't really changing. Growing in core personal loans is still very high priority for us. We've also shared that getting our secured products contribution profitable is a top priority for us. You're certainly right. Those are some of our top priorities. I would not say that we are significantly de-emphasizing core personal loans compared to before or anything like that. It's still right up there at the top. Now, having said that, our guidance is our guidance. We have two pieces of guidance out there. One is around this year, and one is around our growth rate that you can expect over the next few years. We've been guiding to a 35% compounded growth rate. Of course, because the core business is such an important part of that, those are going to be somewhat tightly related to each other. I would just point you back to that if you're looking to model something in terms of what kind of growth rate we think is sustainable for this business. Then, of course, our job is to execute as best we can and do the very best possible job against that guidance we possibly can. It is, of course, in context of what's going on in the macro, because our very first, maybe the meta priority of the business is always do credit right. If you get a bit of credit tailwind, that's going to probably push you a fair bit ahead. If you get some of a credit headwind, then maybe the opposite direction. TLDR is sort of like look at our kind of long-term guidance, and I think that probably is going to be closely related to what's going on in the core business. From an execution perspective, on things that are within our control, AKA things that are not macro, the core continues to be very important to us, and we're going to do everything in our power to grow that business. Okay. I only have one other one, and then I'll let Jeremy go. As we think about kind of the adjusted net income, obviously, it sounds like you think that the stock price is undervalued. Can you give us some benchmarks? Because as a traditional financial investor, a lot of my focus is on price to earnings, price to book, but then also understanding the capital contribution. I know you guys highlight that I think it's 5.9% of your loans outstanding are held on balance sheet. That doesn't actually include the co-invests, which also include I think another 5% plus of capital required on the balance sheet relative to overall. How do you guys Can you give us guide rails as to I was surprised to see the stock buyback in the first quarter just because if we think about your overall call it return on capital from maybe the co-invest, I think you guys have said it's high teens over time. If we're looking at a stock that's 3x tangible book value and 12, 15 times kind of adjusted earnings but really 30 times earnings if you back out SBC, how should we think about the guide or the guardrails around capital allocated towards the stock price versus capital allocated towards the core business? Yeah. A lot to unpack there. Let's see. Probably the first thing I would say is that we don't see the business as primarily being funded by our own equity capital. It is certainly true that we have some amount of equity capital that's required to operate the business. We think that over time there's going to be increasingly efficient ways to do that, and so that's why we've talked about this 5.9% number, which sort of starts to nudge people towards thinking about this in terms of as a proportion of the total size of the pie of originations. That, of course, has been growing very quickly and we expect to continue to grow. Maybe that's the first thing, which is we're going to be really efficient about what fraction of all the originations requires Upstart equity capital and how much Upstart equity capital is required, whether that's in the form of directly on balance sheet or, to your point, the risk capital co-invest, which is sort of a nice thing for us. It works out because it secures these long-term capital commitments from partners that's fairly unique in the market, gives the business a lot of resilience, is a really good thing. But then, really the value of the business doesn't come from the ROE of the money that goes onto the balance sheet or the risk capital. I think of those almost as just a necessary part of the supply chain to make it all work. The real value is coming from the growth in the contribution profits of the business. That is mostly fee revenue that is getting earned on transaction. The growth rate in that I think is actually probably the one place I would look and say, "Well, that is actually the thing that is extremely uncommon for I think your typical kind of comp that you might look at and say, 'Oh, what is the typical price to book or price to earnings?'" I think any kind of multiple is fine over a sufficiently long timeframe if you are considering the growth rate of the underlying business. I think it is just really hard to be like, "Well, I am going to compute an average financial services business on a price to book basis in 2027 when that business is probably growing at a rate that is a fraction of the rate that our business is growing in." That is of course what it ultimately comes down to is the growth rate in the business, and in our case, I would say the growth rate and the contribution profit, which is of course real fee revenue. It is tru e that it is powered and made possible by the amount of equity capital that is either supporting balance sheet or risk capital. That is why I have laid out my framework of priorities as we want to grow contribution profits and we want to do it in a way that is really, really efficient with equity capital. I think if you believe those two things about the business, then you get to a pretty different view of the stock. Okay. My only pushback would be, obviously contribution profits have grown significantly over the last year. But on the fixed cost basis, those are also up 30%+, which does not necessarily lean into the operating leverage that I think you guys are trying to kind of. Obviously over time, that should manufacture the operating leverage, just given the growth and the TAMs of the businesses. But if you are growing contribution profits by a certain amount, and you have in the last year, you would think more of that would fall to the bottom line when in fact 30%+, in the fixed expense base year-over-year, has not really let that come to the investors. Yeah, you're absolutely right. The operating costs have been growing. Some of that is intentional investment in some new areas that we think are going to pay off nicely. But in any event, we've, I think, made it pretty clear at this point that I think the lion's share of that growth and the rate of it has happened, and that looking forward for the rest of this year, the growth rate is going to be much, much slower. I think the operating leverage will start to get a little clearer as time goes on. Why don't we go to Jeremy, and then I actually had a couple come in over email, too, and then Oren, we'll come to you after I go through the email ones. Let's go to Jeremy next. Great. Thanks so much. I appreciate it, Paul. Appreciate you doing this. I guess in terms of what happened on the quarter and the messaging, that was all quite clear to me. From our vantage point, you guys did exactly what you said you'd do, exactly what the investment community, I think, wanted you to do. The profitability is inflecting. You executed well despite the UMI ticking up a bit. You have a much stickier capital base now. You're buying back stock, both personally and as a company, and you and Andrew are both incredibly incentivized for the stock to appreciate and be a multibagger from here. So my question is what has been the investor feedback? Because I'm trying to understand why the stock is where it is and what the feedback from the investment community has been. Because objectively, just the reaction to the last quarter and the stock not getting more attention given what has changed over the last six months for the company, which seems like a real inflection point to me across a number of dimensions, like what do you think has been from, I'm sure you've had a ton of investor conversations, has been underappreciated or misunderstood? Yeah. We've certainly spent a lot of time with investors since the meeting. I do think that across the board, there's been some pretty strong appreciation of the quarter. I think us doing the things that we said we would do this quarter, I think everybody's appreciated that. I think the sort of outstanding questions, I never felt like it would just be one quarter and everybody would be sold on the business or its outlook. I think there's some outstanding questions. I think you just heard one around OpEx, which is people are confused why our OpEx keeps going up. I think it makes it a little harder to model how much operating leverage you should believe this business has over the next few years. I think that there is some concerning questions around the sort of how much overtime, how much equity capital this business will need. There's this bank thing coming up and what is that and what are the implications of that. I think that's maybe just a bit of a new thing that not everybody's really familiar with yet. On that particular point, we've stated, I think, pretty unambiguously that we think we have sufficient capitalization to open Upstart Bank early next year, and that it's going to be pretty accretive to us operationally because it's both sort of economically more efficient and operationally more efficient, lets us sort of get to more states and make more offers. So it's a really good thing for us. But I think there's just a little bit of consternation around that. Then I think probably most fundamentally is just one quarter is probably just not enough if you're just fearful that actually if you look at the past N quarters of this business and you say, "Well, okay, there's this one quarter where it seems like you were able to grow profitably, and then there's all these other quarters where you weren't. Maybe this quarter was just like a lucky fluke. Maybe it was only because the macro was supportive or something, and that's about to change." You look at that and you just have, I think, reason to worry that one quarter is not enough to prove the thesis. I can't blame anybody for feeling like they want to see more proof points. So I think what's in our control is we're going to keep doing is just this short list of priorities. We're going to continue proving that our core personal loan business is really strong, really differentiated, and something that can grow for a long time to come. That we've got these new horizon businesses in home and auto that have enormous TAMs that are going to become real businesses, that are unit economic positive, and something that you can believe in to give us a runway to grow for even more years to come. That we're going to do all this while still operating in a really capital discipline, capital efficient way. I think if we can show those things, then whether it's one quarter or two quarters or five quarters, I think that eventually lots of investors are going to have to change their minds. So maybe I am going to preempt it a little bit here and just jump in. I was going to ask this question at the end, but Paul, wondering since you became CEO, you have obviously increased your engagement with investors, analysts. What is the one thing that you think people get most wrong about Upstart or struggle to understand about Upstart? Is there something that you just when you meet with them compared to your understanding and from your seat is just baffling, something that people are just not getting or not understanding? Well, I said this on the original earnings call. I think the answer is everything. I think when I took the seat earlier this year, there just really had never been a bigger gap between how we saw ourselves at Upstart and how the rest of the market saw us. It is like our business was stronger than ever. It was like we had the best tech we had ever had, the most committed capital we had ever had. We had more borrower relationships, more customers with traction in home and auto. We used to just be a one-product personal loans business. All of these are things that are real wins that are kind of durable no matter what the macro environment is. The opportunity is just so big, given this kind of intersection of the AI disruption meets one of the largest, oldest industries in the world. I think just like the market was like every element of the business was an area of concern. It was just like, "Hey, your margins seem to be compressing. You have been growing for multiple quarters but not actually growing your contribution profits. You have just dipped back into GAAP unprofitability. How are you going to fund all of these loans? Are these new businesses ever going to be real businesses or are they just kind of things where you can grow originations, but again, not make profits out of it?" I think that it is actually a lot of different concerns, each of which is a little related to the others, but sort of an independent thing that you have to get right. I think we are just going to go and take all of these questions head on because we have a lot of confidence that actually the trajectory the business is on is going to naturally show that you can get a ton of profitable growth for a very long time in a really capital efficient way. Of course, the great news is if we do that, kind of no matter what I think what investors or the market wants to do with us in terms of what kind of multiple they want to use or valuation framework, at the end of the day, I think all of them are going to go up with profit. Of course, if you have the profits, then you get to bet on your own future, and that is what we are planning to do. Got it. I think we have about 5-7 minutes left. I am going to go back to investor questions now. One question that we did get was about the full Q2 2024 vintage. It looks like it has been, I think, underperforming a little bit targets. What is driving that there? I think this quarter it moved towards underperforming targets. What is driving that? Is there something specific in that vintage that we need to be aware of or that you are watching? No, nothing terribly specific. Overall credit performance has been really strong. We have been really happy with the returns that have been getting delivered to investors. We always talk about how the returns have been consistently many hundreds of basis points above the spread of treasuries averaging, I think, something like 600. They are really, really strong returns. Just kind of naturally, you are going to have some vintages that are a little over, some vintages that are a little under. I think that is pretty par for the course and not something that worries us terribly much. Some of that variation, which vintages do well and not well is just going to be correlated to the changes in UMI because as a first-order approximation, think of us as underwriting to the UMIs at the time of the underwriting. If UMI subsequently goes up a lot or goes down a lot, that is going to give either a tailwind or a headwind to the credit performance of that particular vintage, of course, because UMI mathematically is just going to be something that is linearly correlated to the rate of defaults. That is part of it. Then there is sometimes some idiosyncratic factors that matter a little bit to each vintage. No, when we talk about underperformance of these vintages, I would say our effects overall tend to be pretty modest and except for that period of time right after the stimulus ended when there was this huge upswing in UMI. Obviously, that was a larger effect. Really since then, we have been very happy with the credit performance, and it is just kind of some natural variation and then some UMI-driven variation. Got it. Oren, I know you have had your hand up for a while. Why do not we go to you? No problem. Thanks, Mihir. Thanks, Paul. Thanks for the time. I'll be brief. I think maybe a couple other things is cash flow generation is probably another focus of the market. But in terms of balance sheet growth, that's probably another thing people are focusing on, which I think you're doing a great job of pulling that back. But related to that on the balance sheet, just curious on your convertible bonds, since you're buying back shares why not go after those since those maturities are trading in the 70s? Perhaps just thinking if that's a good use of capital. Thanks. It's certainly something we looked at when we last did some share repurchases. But we mostly just looked at what we expected the sort of IRRs on each to be, and we just thought that the stock's IRR was just higher, and it was so much higher that it was like, oh, even though the other thing is more debt-like and there's some value in getting that down, whatever, they're risk-adjusted, not the same. But nonetheless, the delta, we just thou ght that the stock IRR was just so high. So that's how we think about these things, is just we're trying to maximize the IRR of where we deploy capital, and that could be internal uses or stock uses or various kinds of buybacks, and that's how we'll generally compare them. Yeah, it makes sense. I'm always wondering what you think that IRR is and where you think the stock goes. But just maybe lastly on just the cash flow generation how low, in terms of cash flow generation, you don't really have much at this point, but just curious to know how low you're willing to take cash in terms of those share repurchases, and when do you expect to kind of ramp up on free cash flow? Well, the business is growing a lot, and we expect it to continue growing a lot. And I've said that it's really important to us that we keep a sufficient level of investment that the sort of long-term kind of addressable market here is on the table. And so that basically means that I think we need to keep adequate amount of cash for all our various initiatives. Of course, like capitalizing this bank is something that's going to use cash. So we're being mindful around that and we want to be mindful around the amount of cash. And so yeah, I would like to generate more cash, and when we generate more cash, then we get more options of what we do. And until we do that, options are more limited. Got it. Thank you. Appreciate your time. Maybe just turning very quickly to the Cash Line product. It's one of your newer products. Talk a little bit about that product just in terms of how you work, how you're funding it today, what the end state looks like, and then also maybe just spend a little bit of time on the modeling aspect of it because it is a little bit of a different product than your personal loan or even the always-on credit, if you will. So maybe just spend a few minutes on that and just help us understand how big of a lift was it to put that into practice. Yeah, the Cash Line product is a great product for us. It's one that I wish we had launched sooner and earlier in our history. It's a product where you have to be really good at underwriting because you're serving a consumer that's fairly financially stressed most of the time. It's really important to underwrite that consumer well. But it's also a product that can be extremely high demand. It's a product that people kind of search for proactively. Most credit products, you have to find your borrower, and this is one where the borrower finds you. That's a pretty amazing fact about that as a business. As a result, it's a business that if you do right, I think can be a very profitable business. We're really early stages on that, kind of in my steps one, two, three, four of building a new product. It's just kind of cleared step one, which is it's proven, wow, people really want this thing, and then you've got to prove everything else about it and figure out the right kind of funding rails for it, the right sort of lock-in kind of credit calibration on it, and then get unit economics. So there's still a bunch of work to do on this product, but it's extremely high potential. It's a really good match for the core competencies we have as a business. I wish we started sooner, but next best time is now. Got it. I am being flagged that we are now past time, so I will have to stop it there, though there are a few more questions we would have loved to get to. I think it was a really good discussion. Appreciate all the investors being super engaged and asking questions, too. Thank you again, Paul, Sonya, and team. Thank you so much for taking the time and joining us today. Thank you.