Upstart Holdings Inc (UPST) 2024 Q3 法說會逐字稿

Good day and welcome to the Upstart third quarter 2024 earnings call. Today's conference is being recorded. At this time, I would like to turn the conference over to [Alice Berry]. Please go ahead.

美好的一天，歡迎參加 Upstart 2024 年第三季財報電話會議。今天的會議正在錄製中。這次，我想把會議交給[Alice Berry]。請繼續。

Good afternoon and thank you for joining us on today's conference call to discuss Upstart's third quarter 2024 financial results. With us on today's call are Dave Girard, Upstart's Chief Executive Officer, and Sanjay Datta, our Chief Financial Officer.

下午好，感謝您參加今天的電話會議，討論 Upstart 2024 年第三季的財務表現。參加今天電話會議的有 Upstart 執行長 Dave Girard 和財務長 Sanjay Datta。

Before we begin, I want to remind you that shortly after the market closed today, Upstart issued a press release announcing its third quarter 2024 financial results and published an Investor Relations presentation. Both are available on our Investor Relations website, ir.upstart.com. During the call, we will make forward-looking statements such as guidance for the fourth quarter of 2024 related to our business and our plans to expand our platform in the future. These statements are based on our current expectations and information available as of today and are subject to a variety of risks, uncertainty, and assumptions. Actual results may differ materially as a result of various risk factors that have been described in our filings with the SEC. As a result, we caution you against placing undue reliance on these forward-looking statements. We assume no obligation to update any forward-looking statements as a result of new information or future events, except as required by law.

在我們開始之前，我想提醒您，今天收盤後不久，Upstart 發布了一份新聞稿，宣布其 2024 年第三季財務業績，並發布了投資者關係簡報。兩者均可在我們的投資者關係網站 ir.upstart.com 上找到。在電話會議期間，我們將做出前瞻性陳述，例如與我們的業務相關的 2024 年第四季度指引以及我們未來擴展平台的計劃。這些陳述是基於我們目前的預期和截至目前可獲得的信息，並受到各種風險、不確定性和假設的影響。由於我們向 SEC 提交的文件中所述的各種風險因素，實際結果可能會存在重大差異。因此，我們提醒您不要過度依賴這些前瞻性陳述。我們不承擔因新資訊或未來事件而更新任何前瞻性聲明的義務，除非法律要求。

In addition, during today's call, unless otherwise stated, references to our results are provided at non-GAAP financial measures and are reconciled to our GAAP results, which can be found in our earnings release and Supplemental Tables. To ensure that we can address as many analyst questions as possible during the call, we request that you limit yourself to one initial question and one follow-up. On November 22, Upstart will be participating at the Webush Disruptive Finance Virtual Conference.

此外，在今天的電話會議中，除非另有說明，否則我們的業績參考均以非公認會計準則財務指標提供，並與我們的公認會計準則業績進行了調整，這些結果可以在我們的收益發布和補充表格中找到。為了確保我們能夠在電話會議期間回答盡可能多的分析師問題，我們要求您只提出一個初始問題和一個後續問題。 11 月 22 日，Upstart 將參加 Webush 顛覆性金融虛擬會議。

Now, we'd like to turn it over to Dave Girard, CEO of Upstart.

現在，我們想將其交給 Upstart 執行長 Dave Girard。

Good afternoon, everyone. I'm Dave Girard, co-founder and CEO of Upstart. Thanks for joining us on our earnings call covering our third quarter 2024 results. We know there's a lot going on this week, and we appreciate you making the time to be with us. I'm happy to report that we continue to strengthen Upstart's position as the fintech leader in artificial intelligence.

大家下午好。我是戴夫·吉拉德 (Dave Girard)，Upstart 的共同創辦人兼執行長。感謝您參加我們的財報電話會議，介紹我們 2024 年第三季的業績。我們知道本週有很多事情發生，我們感謝您抽出時間與我們在一起。我很高興地向大家報告，我們將繼續鞏固 Upstart 作為人工智慧金融科技領導者的地位。

With our Q3 results, it's clear that our team's efforts are driving improved financial performance today, as well as a stronger foundation for the quarters and years to come. With 43% sequential growth in lending volume and a return to positive adjusted EBITDA sooner than expected, we're pleased that Upstart's comeback story continues to play out as we anticipated. When I look across Upstart, I see improvements in so many areas that are important to our future.

從我們第三季的業績來看，很明顯，我們團隊的努力正在推動當今財務業績的改善，並為未來幾季和幾年打下更堅實的基礎。隨著貸款量較上季成長 43%，調整後 EBITDA 恢復正數的時間也早於預期，我們很高興 Upstart 的捲土重來繼續按照我們的預期上演。當我審視 Upstart 時，我看到了許多對我們的未來很重要的領域的改進。

Our core product is growing quickly, has exceptional economics and is delivering increasingly competitive rates across the credit spectrum. Our newer products are gaining traction, with both our auto and home lending products expanding nicely quarter to quarter. And our funding supply has never been more durable, with more committed capital than ever, powered by truly innovative partnership structures.

我們的核心產品發展迅速，具有卓越的經濟效益，並在整個信貸領域提供越來越有競爭力的利率。我們的新產品越來越受歡迎，我們的汽車和房屋貸款產品逐季成長良好。我們的資金供應從未如此持久，承諾資本也比以往任何時候都多，並由真正創新的合作夥伴結構提供支持。

Overall, credit performance continues to strengthen and gives us confidence that we're well calibrated to the macro. And finally, our velocity at delivering AI wins has never been better. Consistent with last quarter, these improvements weren't primarily driven by improvements to the macroeconomy. While the 50 basis point reduction in the Fed rate provided a modest boost to platform volume at the end of September, rates overall continue to be quite elevated, and the upstart macro index, while stable, continues to be well above the historical average. This is all to say that we believe any substantial macroeconomic wins remain in our future.

總體而言，信貸表現持續增強，讓我們相信我們已經很好地適應了宏觀情況。最後，我們實現人工智慧勝利的速度從未如此之快。與上季一致，這些改善主要不是由宏觀經濟改善所推動的。儘管聯準會降息 50 個基點對 9 月底的平台交易量產生了小幅提振，但總體利率仍然相當高，新貴宏觀指數雖然穩定，但仍遠高於歷史平均水平。這就是說，我們相信任何重大的宏觀經濟勝利仍然存在於我們的未來。

Today I'd like to share some details about the third quarter and the progress that we made. In our core personal loan product, we continue to iterate on our ability to rapidly launch increasingly sophisticated models. Model 18, which I described in some depth last quarter, drove large conversion improvements in Q3, which translated to much of the growth we're reporting today. We also continue to solve ML infrastructure and scaling challenges related to training frequency, process automation, and inference speed. We've set aggressive goals regarding data freshness for our machine learning team, which is critical to proper calibration in a volatile macro environment.

今天我想分享一些有關第三季的細節以及我們所取得的進展。在我們的核心個人貸款產品中，我們繼續迭代我們快速推出日益複雜的模型的能力。我在上個季度深入描述的 Model 18 在第三季度推動了轉換率的大幅提高，這轉化為我們今天報告的大部分成長。我們也持續解決與訓練頻率、流程自動化和推理速度相關的機器學習基礎設施和擴展挑戰。我們為機器學習團隊設定了有關資料新鮮度的積極目標，這對於在不穩定的宏觀環境中進行正確校準至關重要。

We're also working hard to reduce model latency, even in the face of deploying more technically sophisticated models. In Q3 alone, we reduced model inference latency by 13%. I believe that our model training and deployment represent the state-of-the-art in an industry that, for the most part, has yet to discover the power of predictive AI.

我們也努力減少模型延遲，即使面對部署技術上更複雜的模型也是如此。僅在第三季度，我們就將模型推理延遲減少了 13%。我相信我們的模型訓練和部署代表了這個行業的最先進水平，而這個行業在很大程度上尚未發現預測人工智慧的力量。

Q3 was Upstart's largest quarter of personal loan origination volume in two years, despite the significantly elevated rates I mentioned earlier. Our goal is to offer the best rates and best process to all Americans, and we're making significant strides in this direction. This means not just having the best models and highest levels of automation, but feeding them with the most efficient fuel, the capital, so that the end product, the loan, is consistently the best available. While this is a goal we can never 100% achieve, a constant, urgent, and determined effort to offer the best rate and the best process to everybody will make Upstart a formidable brand and a sustainable leader in the industry.

儘管我之前提到的利率大幅上升，但第三季是 Upstart 兩年來個人貸款發放量最大的季度。我們的目標是為所有美國人提供最優惠的價格和最佳流程，我們正在朝這個方向取得重大進展。這意味著不僅擁有最好的模型和最高水準的自動化，而且還要為它們提供最有效的燃料和資本，以便最終產品（貸款）始終是最好的。雖然這是我們永遠無法100% 實現的目標，但持續、緊迫和堅定的努力，為每個人提供最優惠的價格和最好的流程，將使Upstart 成為一個強大的品牌和行業可持續的領導者。

Our T-Prime program, which we announced just a couple of weeks ago, takes a giant leap toward this goal by expanding our reach to the super prime end of the credit spectrum. By working closely with our lending partners, we're creating offers of credit that shine in comparison to anything in the market and bring us closer to a brand that can resonate with all Americans.

我們幾週前剛宣布的 T-Prime 計劃通過將我們的業務範圍擴大到信用範圍的超級優質端，向這一目標邁出了一大步。透過與我們的貸款合作夥伴密切合作，我們正在創造與市場上的任何產品相比都更加出色的信貸優惠，並使我們更接近一個能夠與所有美國人產生共鳴的品牌。

Originations of Upstart auto loans increased 46% sequentially to $26.5 million. On the retail side, we signed our 11th certified digital retailing OEM agreement in October. This agreement increases Upstart's franchise dealer market opportunity by 14%. In October, we also began the rollout of a complete redesign of Upstart's in-store software product that improves usability and information access as we continue to modernize the technology stack used by dealerships across the country.

Upstart 汽車貸款發放金額較上季成長 46%，達到 2,650 萬美元。在零售方面，我們於 10 月簽署了第 11 個經過認證的數位零售 OEM 協議。該協議將 Upstart 的特許經銷商市場機會增加了 14%。十月，我們也開始推出對 Upstart 店內軟體產品的全面重新設計，隨著我們繼續對全國經銷商使用的技術堆疊進行現代化改造，該產品提高了可用性和資訊存取。

On the refinance side, we recently upgraded the loan application experience reducing the average time to fund from 19 days to 9. Car owners who refinance with Upstart now save an average of $800 per year, and we're optimistic that we can increase the amount saved by our borrowers in the months ahead. Our home equity business continues to scale like you'd expect from a fast-growing startup, with originations more than doubling on a sequential basis.

在再融資方面，我們最近升級了貸款申請體驗，將平均融資時間從 19 天減少到 9 天。未來幾個月可以節省開支。我們的房屋淨值業務繼續擴大規模，就像您對快速成長的新創公司所期望的那樣，其發起數量環比增加了一倍多。

And I'm also happy to report that with more than 600 HELOCs originated to date we still have zero defaults. Growth in the HELOC product was driven predominantly by conversion rate improvements, a common theme if you've followed Upstart for long. Better targeting and higher qualification rates, combined with a 50% increase in closed rates of those offered loans, led to these strong results. We exited Q3 with an instant approval rate for HELOC applicants of 49%, up from 42% in Q2. This means we're able to instantly verify applicants' income and identity without the need for tedious document uploads.

我還很高興地報告，迄今為止，我們已發起 600 多個 HELOC，但違約率仍然為零。 HELOC 產品的成長主要是由轉換率的提高所推動的，如果您長期關注 Upstart，這就是一個常見的主題。更好的目標定位和更高的合格率，再加上所提供貸款的結清率提高了 50%，導致了這些強勁的業績。第三季結束時，HELOC 申請人的即時核准率為 49%，高於第二季的 42%。這意味著我們能夠立即驗證申請人的收入和身份，而無需繁瑣的文件上傳。

We're now live in 34 states and Washington, D.C., covering 55% of the US population. We expect to expand to more states with our HELOC product this quarter. We continue to invest heavily in servicing and collections. And as I've said before, we're particularly focused on leveraging machine learning to customize the borrower experience and improve repayment rates. and this effort is beginning to pay off. I'm increasingly confident that loan servicing and collections will become another area where we have unique and sizable competitive advantage over time.

我們現在遍布 34 個州和華盛頓特區，涵蓋美國 55% 的人口。我們預計本季將我們的 HELOC 產品擴展到更多州。我們繼續在服務和收藏方面投入大量資金。正如我之前所說，我們特別關注利用機器學習來客製化借款人體驗並提高還款率。這種努力正在開始得到回報。我越來越有信心，隨著時間的推移，貸款服務和催收將成為我們擁有獨特且巨大競爭優勢的另一個領域。

In Q3, we launched multiple personalization efforts, including optimizing the time of day to call and the time of day to send emails. We don't have concrete results for these initiatives yet, but they're part of our broader push to use machine learning and data to create a materially differentiated loan servicing experience. We also expanded support coverage to include Sundays without adding headcounts to the team.

在第三季度，我們推出了多項個人化工作，包括優化一天中的通話時間和發送電子郵件的時間。這些舉措尚未取得具體成果，但它們是我們更廣泛推動的一部分，旨在利用機器學習和數據創造顯著差異化的貸款服務體驗。我們還擴大了支援範圍，將週日納入，而無需增加團隊人數。

And finally, we began exploring the use of large language models to reduce our spend even further. Our work to improve operational efficiency combined with machine learning means we believe we can continue to improve roll rates, even while reducing the cost of servicing each loan. Last quarter, we continued to see strong loan performance, with roll rates from one-day delinquent to charge-off down 13% year-over-year. Even more compelling is that 30-day delinquency rates have trended down sequentially through Q3, despite the fact that the third quarter has traditionally been a seasonally worse quarter for loan servicing. We're confident that there are many more wins in this part of our business in the coming quarters.

最後，我們開始探索使用大型語言模型來進一步減少支出。我們將提高營運效率與機器學習結合的工作意味著我們相信我們可以繼續提高滾動率，同時降低每筆貸款的服務成本。上季度，我們繼續看到強勁的貸款表現，從一日拖欠到核銷的展期利率年減 13%。更引人注目的是，儘管第三季度傳統上是貸款服務季節性較差的季度，但第三季的 30 天拖欠率呈現連續下降趨勢。我們相信，在未來幾個季度，我們的這一部分業務將取得更多勝利。

On the funding supply of our business, we continue to strengthen our position quarter-to-quarter. A few weeks back, we announced a partnership with Blue Owl whereby their Adelia affiliate will purchase up to $2 billion in loans from the Upstart platform over 18 months. Similar to last quarter, I'm happy to report that in Q3, well over half of our loan funding was in the form of longer-term committed partnerships.

在我們業務的資金供應方面，我們繼續逐季加強我們的地位。幾週前，我們宣布與 Blue Owl 建立合作夥伴關係，他們的 Adelia 附屬公司將在 18 個月內從 Upstart 平台購買高達 20 億美元的貸款。與上個季度類似，我很高興地報告，在第三季度，我們超過一半的貸款資金是以長期承諾合作關係的形式出現的。

Today, I want to call out the incredible work done by our capital markets team, who have risen to the challenge of developing important and innovative partnerships with several of the market leaders in private credit. Innovation on the funding side of our business is a trend I expect to continue throughout 2025. Banks and credit unions continue to increase their funding on the Upstart platform as their liquidity improves and they ramp up their lending. This year we signed 24 new lenders, which is already more new lenders and new capital than was added in all of 2023.

今天，我想讚揚我們的資本市場團隊所做的令人難以置信的工作，他們迎接挑戰，與私人信貸領域的幾家市場領導者建立重要和創新的合作夥伴關係。我預計我們業務融資方面的創新將在 2025 年持續下去。今年，我們簽署了 24 家新貸款機構，這已經比 2023 年全年新增貸款機構和新資本還要多。

In addition, More of our existing bank and credit union partners are expanding their lending programs with us, bringing more low-cost capital with more attractive rates to Upstart borrowers. The T-Prime program I mentioned earlier is one important way they're doing this. I'm also pleased that loan funding has kept pace nicely with our regrowth of originations. The volume of loans on Upstart's balance sheet continues to trend down, even while loan originations have accelerated. We're also in a stronger cash position as a result. Keeping supply and demand in balance while we regrow our core business will continue to be a challenge, but we're in a strong position to manage this important dynamic.

此外，更多我們現有的銀行和信用合作社合作夥伴正在與我們一起擴大貸款計劃，為新貴借款人帶來更多低成本資本和更具吸引力的利率。我之前提到的 T-Prime 計劃是他們實現這一目標的重要方式之一。我還很高興的是，貸款資金與我們的新創公司的再生成長保持了良好的同步。 Upstart 資產負債表上的貸款量持續呈下降趨勢，儘管貸款發放速度有所加快。因此，我們的現金狀況也更加強勁。在我們重振核心業務的同時保持供需平衡仍將是一項挑戰，但我們有能力管理這項重要動態。

Last quarter, I told you that Upstart was turning a corner. Now we can say that we're clearly gaining momentum. Even without a significant boost from the macroeconomy, we're in growth mode, and our credit is performing well. Our core business is expanding again, and our newer businesses are making fast progress. We're hopeful that we'll see macroeconomic wins in the quarters to come, but we're not waiting around for them. Upstart's mission is simply to improve access to credit.

上個季度，我告訴你 Upstart 正在扭轉局面。現在我們可以說我們顯然正在獲得動力。即使沒有宏觀經濟的顯著提振，我們仍處於成長模式，而且我們的信貸表現良好。核心業務再次拓展，新業務快速推進。我們希望在未來幾季看到宏觀經濟的勝利，但我們不會等待它們。 Upstart 的使命只是改善獲得信貸的機會。

Our strategy to accomplish this goal is to provide the best rates and best process to everybody. This isn't AI for AI's sake. It's because more than a decade ago, we recognized that it's the right tool to accomplish this ambitious goal. We believe that success in this regard will result in a generational company with immeasurable impact on American families and the US economy. We're making rapid progress against this goal, and as a brilliant leader in our industry once said, it's day one here at Upstart.

我們實現這一目標的策略是為每個人提供最優惠的價格和最佳流程。這不是為了人工智慧而人工智慧。這是因為十多年前，我們意識到它是實現這一宏偉目標的正確工具。我們相信，這方面的成功將造就一家對美國家庭和美國經濟產生不可估量影響的代際公司。我們正在朝著這一目標取得快速進展，正如我們行業的一位傑出領導者曾經說過的那樣，這是 Upstart 的第一天。

Thank you, and now I'd like to turn it over to Sanjay, our Chief Financial Officer, to walk through our Q3 2024 financial results and guidance. Sanjay?

謝謝，現在我想將其交給我們的財務長 Sanjay，讓他詳細介紹我們 2024 年第三季的財務表現和指導。桑傑？

Thanks, Dave, and thanks to all of you who are joining us today on what I'm sure has been a distracting week for everyone here in the US. The macro environment continues to be an influential factor in our business, though with respect to consumer credit, it has, in our view, remained relatively stable since our last report a quarter ago.

謝謝戴夫，也感謝今天加入我們的所有人，我相信這對美國每個人來說都是令人分心的一周。宏觀環境仍然是我們業務的影響因素，儘管我們認為，自我們上一份季度報告以來，消費信貸一直保持相對穩定。

As anticipated, this has allowed our risk models the freedom to continue improving borrower selection and driving conversion gains. Our belief is that inflation is largely behind us, a remnant trace from an historically large increase in the money supply that occurred between 2020 and 2021. The enduring strength of our labor market also continues to astonish, and in our view, the US economy now suffers from a structural shortage of workers, making the odds of significant near-term unemployment, in our estimation, remote in any scenario short of an economic meltdown.

正如預期的那樣，這使我們的風險模型能夠自由地繼續改進借款人選擇並推動轉換收益。我們相信，通膨已基本成為過去，這是 2020 年至 2021 年間貨幣供應量歷史性大幅增長的殘餘痕跡。性短缺，我們估計，在經濟崩潰的任何情況下，短期內出現嚴重失業的可能性都很小。

Consumers in the US have continued their remarkable spending spree, perhaps even a little too remarkably for our taste, but Americans did enjoy a surge of disposable income entering 2024 that provided some support for the ongoing spend levels. as well as some welcome breathing room and savings rates. Consequently, consumer defaults on unsecured credit have stabilized over the course of the year, easing down from their peak to a lower but still elevated level of stress, as reflected in our Upstart Macro Index. Taken as a whole, the macro currents around us have become much less choppy, and in their current state no longer appear to represent a direct headwind to our business. With all of this as context, here are some financial highlights from Q3 of 2024.

美國消費者繼續進行驚人的消費狂潮，甚至可能有點不太符合我們的口味，但進入 2024 年，美國人的可支配收入確實激增，這為持續的消費水平提供了一些支持。以及一些令人歡迎的喘息空間和儲蓄率。因此，消費者對無擔保信貸的違約在這一年中趨於穩定，從峰值下降到較低但仍然較高的壓力水平，正如我們的新貴宏觀指數所反映的那樣。總體而言，我們周圍的宏觀潮流已經變得不再那麼波動，並且在目前的狀態下似乎不再對我們的業務構成直接阻力。以此為背景，以下是 2024 年第三季的一些財務亮點。

Revenue from fees was $168 million in Q3, up 28% sequentially from the prior quarter, and 8% ahead of guidance, as various model accuracy enhancements continue to produce improved conversion. Net interest income was negative $5 million. Less than half of the net interest income loss we experienced in the same quarter a year ago. Taken together, net revenue for Q3 came in at $162 million. $12 million above our guidance and up 20% year-on-year. The volume of loan transactions across our platform in Q3 was approximately 188,000 loans, up 64% from the prior year and up 31% sequentially, and representing over 118,000 new borrowers.

第三季的收費收入為 1.68 億美元，比上一季連續成長 28%，比指導值高出 8%，因為各種模型準確性的增強繼續提高了轉換率。淨利息收入為負500萬美元。不到一年前同一季度我們經歷的淨利息收入損失的一半。總而言之，第三季淨收入為 1.62 億美元。比我們的指導值高出 1200 萬美元，年增 20%。第三季我們平台上的貸款交易量約為 188,000 筆貸款，比上年增長 64%，比上一季增長 31%，代表超過 118,000 名新借款人。

Average loan size of $8,400 was up from $7,700 in the prior quarter driven higher by the model wins, which allowed more borrowers to qualify for full personal loans at the expense of the smaller relief loans that they otherwise would have been presented with. Our contribution margin, a non-GAAP metric, which we define as revenue from fees minus variable costs for borrower acquisition, verification, and servicing as a percentage of revenue from fees, came in at 61% in Q3, up 3 percentage points sequentially, and 4 percentage points above our guidance for the quarter. Our margins benefited from higher conversion rates on personal loans, as well as improved automation and efficiency in the borrower onboarding process.

平均貸款規模從上一季的 7,700 美元上升到 8,400 美元，這得益於模型獲勝，這使得更多藉款人有資格獲得全額個人貸款，但他們本來會獲得較小的救濟貸款。我們的貢獻利潤率是一項非GAAP 指標，我們將其定義為費用收入減去借款人獲取、驗證和服務的可變成本佔費用收入的百分比，第三季度為61%，比上一季度上升3 個百分點。我們的利潤得益於個人貸款轉換率的提高，以及借款人入職流程自動化程度和效率的提高。

Operating expenses were $207 million in Q3, up 13% sequentially from Q2. Expenses that are considered variable, relating to borrower acquisition, verification, and servicing, were up 20% sequentially, less than the growth of the corresponding fee revenue base. Fixed expenses were up 12% as the improved trajectory of the business triggered some catch-up accruals for expenses that were not being incurred earlier in the year at our lower volumes, some of which will be temporary in nature. We continue to pursue tight expense management as a core principle and have implemented some further streamlining of operational headcounts since the end of the quarter. Altogether, Q3 GAAP net loss was $7 million, significantly ahead of guidance, and due in large part to gains made on the refinancing of some of our outstanding convertible debt.

第三季營運支出為 2.07 億美元，比第二季成長 13%。與借款人獲取、驗證和服務相關的可變費用連續增長 20%，低於相應費用收入基礎的增長。固定費用增加了 12%，因為業務軌蹟的改善引發了一些應計費用的追趕，這些費用在今年早些時候我們的銷量較低時沒有發生，其中一些本質上是暫時的。我們繼續將嚴格的費用管理作為核心原則，並自本季末以來進一步精簡了營運人員。總體而言，第三季 GAAP 淨虧損為 700 萬美元，大大高於指引，這在很大程度上歸功於我們部分未償還可轉換債務再融資所獲得的收益。

Adjusted EBITDA was positive $1 million, also comfortably ahead of guidance, and accomplishing our goal of breaking through to positive adjusted EBITDA one quarter ahead of schedule. Adjusted earnings per share was negative six cents based on a diluted weighted average share count of 90.1 million. We ended the third quarter with loans on our balance sheet of $537 million before the consolidation of securitized loans. down from $686 million in the prior quarter, continuing the progress we've made over the past year in reducing the size of the balance sheet and establishing strong relationships with a handful of strategic capital partners.

調整後 EBITDA 為正值 100 萬美元，也大大超出了指引，並提前一個季度實現了我們突破調整後 EBITDA 為正值的目標。根據稀釋後加權平均股數 9,010 萬股計算，調整後每股收益為負 6 美分。截至第三季末，在合併證券化貸款之前，我們的資產負債表上的貸款額為 5.37 億美元。低於上一季的 6.86 億美元，延續了我們過去一年在縮小資產負債表規模以及與少數戰略資本合作夥伴建立牢固關係方面取得的進展。

Of that loan balance, loans made for the purposes of R&D, principally auto loans, stood at $399 million. In addition to loans held directly, we continue to consolidate $119 million of loans from an ABS transaction completed in 2023 from which we retained a total net equity exposure of $18 million. We ended the quarter with $445 million of unrestricted cash on the balance sheet, up almost $70 million from the prior quarter. In Q3, we also completed the refinancing of roughly half of our outstanding convertible debt with a new issuance that pushes the maturities on this tranche out to 2029.

其中，用於研發的貸款（主要是汽車貸款）為 3.99 億美元。除了直接持有的貸款外，我們還繼續合併 2023 年完成的 ABS 交易中的 1.19 億美元貸款，其中我們保留了 1800 萬美元的淨股權敞口總額。本季結束時，我們的資產負債表上有 4.45 億美元的非限制性現金，比上一季增加了近 7,000 萬美元。在第三季度，我們也透過新發行完成了約一半未償可轉換債券的再融資，將這部分債券的到期日延至 2029 年。

On the funding side of our platform, we see encouraging signs that the markets are becoming increasingly constructive. Liquidity in the banking and credit union sectors continues to improve, and increasing numbers of lenders are dropping their required rates of return on our platform. On the institutional side, the large amounts of money that have been raised under the banner of private credit, initially earmarked mainly for corporate lending, are now increasingly finding their way over to consumer assets.

在我們平台的融資方面，我們看到令人鼓舞的跡象，顯示市場變得越來越有建設性。銀行和信用合作社部門的流動性持續改善，越來越多的貸方正在降低我們平台上的回報率要求。在機構方面，在私人信貸的旗幟下籌集的大量資金最初主要用於企業貸款，現在越來越多地流向消費資產。

In our return to the ABS markets this past month, we saw high levels of oversubscription and significant tightening of spreads for each class of bonds. These are the signs that the capital markets are returning to their core function and once again embracing risk in the pursuit of yield.

上個月我們重返 ABS 市場時，我們看到各類債券的超額認購水準很高，利差也顯著收緊。這些跡象表明資本市場正在回歸其核心功能，並再次在追求收益的過程中擁抱風險。

As we look ahead to Q4, we continue to presume a roughly stable macro environment with minimal change to credit trends in either direction. We expect a September 50 basis point rate cut from the Fed to work its way into our marketplace pricing over the course of this quarter, providing some modest lift to volumes. Beyond that, much of the growth we are anticipating this quarter will be driven by continuing improvements to our models and marketing campaigns, which we expect will generate higher application volumes and borrower approval rates. Expanded availability of funding is not perceived to be a driver of growth in this quarter, but we are assuming that it will also not constrain it.

展望第四季度，我們繼續假設宏觀環境大致穩定，信貸趨勢在任一方向上的變化都很小。我們預計聯準會 9 月降息 50 個基點將在本季影響我們的市場定價，對交易量帶來一定程度的提振。除此之外，我們預計本季的成長將在很大程度上由我們的模型和行銷活動的持續改進所推動，我們預計這將帶來更高的申請量和借款人批准率。資金供應的擴大並不被認為是本季成長的驅動力，但我們假設它也不會限製成長。

On the expense side, we will continue to pursue optimized margins and frugal fixed expense management. With this as context, our guidance for Q4 is total revenues of approximately $180 million, consisting of revenue from fees of $185 million and net interest income of approximately negative $5 million, contribution margin of approximately 59%, net income of approximately negative $35 million, adjusted net income of approximately negative $5 million, adjusted EBITDA of approximately positive $5 million, and a diluted weighted average share count of approximately 91.7 million shares.

在費用方面，我們將繼續追求優化的利潤率和節儉的固定費用管理。以此為背景，我們對第四季的指導是總收入約為1.8 億美元，其中包括1.85 億美元的費用收入和約負500 萬美元的淨利息收入，貢獻率約為59%，淨利潤約為負3,500 萬美元，調整後淨利約負 500 萬美元，調整後 EBITDA 約正 500 萬美元，稀釋後加權平均股數約 9,170 萬股。

Thanks to all once again for joining us on this call. And now, Dave and I will be happy to open up the lines for any questions. Operator?

再次感謝大家加入我們這次電話會議。現在，戴夫和我很樂意為您解答任何問題。操作員？

(Operator Instructions) Peter Christiannsen, Citi.

（操作指示）Peter Christiannsen，花旗銀行。

Good evening. Thanks for the question here. Dave Sanjay, I was just curious if you could talk about underlying use cases on the personal loan side. Have you seen any changes there? There's this notion that a debt consolidation wave could Hey Pete, this is Dave. I don't think there's any radical change. Personal loans have always been a fairly generic tool that consumers can use in a lot of different ways, paying for weddings, paying off debt.

晚安.謝謝你在這裡提問。 Dave Sanjay，我只是好奇你是否可以談談個人貸款方面的潛在用例。你看到那裡有什麼改變嗎？有一種觀點認為，債務合併浪潮可能會掀起一股債務整合浪潮。我不認為有任何根本性的改變。個人貸款一直是相當通用的工具，消費者可以透過多種不同的方式使用它，例如支付婚禮費用、償還債務。

Ramsey El-Assal, Barclays

拉姆齊·阿薩爾，巴克萊銀行

Hi, great. Thank you very much. This is John Coffey on the call for Ramsey. I just had two questions for you. I think Sanjay, in the past couple of earnings calls, you spoke quite a bit about some of the slower recovery in your prime customer. So I was wondering if you could tell me what that recovery looks like, again, in your prime base. Are we close to the middle, the beginning, or the end? And then I guess my second question is just on the trajectory of EBITDA. I know we have a positive number this quarter where you're expecting another one next quarter. Should that be a pretty smooth runway in future years, just generally speaking or are there any one offs? We should keep in mind.

嗨，太好了。非常感謝。我是約翰·科菲 (John Coffey) 為拉姆齊 (Ramsey) 打電話。我只是有兩個問題想問你。我認為桑傑（Sanjay），在過去的幾次財報電話會議中，您多次談到了您的主要客戶的一些較慢的復甦。所以我想知道你能否再次告訴我，在你的主要基地中，復甦是什麼樣的。我們已經接近中間、開始還是結束？然後我想我的第二個問題是關於 EBITDA 的軌跡。我知道本季我們有一個正數，您預計下個季度還會有一個正數。總體而言，未來幾年這應該是一條相當順利的跑道，還是有任何一次性的情況？我們應該牢記在心。

On the second question with respect to EBITDA, as you've seen, we've broke through to break-even-slash-positive EBITDA this quarter. We're guiding up next quarter. As long as we are successful in continuing to improve our models, improve conversion, and grow, we would expect that EBITDA would follow suit. Sorry, John, can you remind me of your first question?

關於 EBITDA 的第二個問題，正如您所看到的，我們本季的 EBITDA 突破了盈虧平衡。我們正在指導下個季度。只要我們成功地繼續改進我們的模型、提高轉換率並實現成長，我們預計 EBITDA 也會隨之而來。抱歉，約翰，你能提醒我你的第一個問題嗎？

Yeah, the status of the prime customer. I know you said they were later to but they're also coming back. But you said some of that that return to the prime customer as opposed to subprime was a little delayed. I think you spoke about it quite a bit. I think the last call or two.

是的，主要客戶的地位。我知道你說過他們會稍後回來，但他們也會回來。但你說，與次級貸款相比，向主要客戶的回報有些延遲。我想你已經談了很多了。我想最後一兩通電話。

But I guess, yeah, thanks for refreshing on, on the on the sort of on the trend of consumer repayments and defaults and the various segments within that, we did call out the fact that there was a bit of a phasing difference between lower-prime and higher-prime consumers in that the lower-prime consumers were impacted sooner than the primer consumers, maybe back in late 2021. And by the time they had stabilized and started improving again, even as of a quarter or two ago, the prime borrowers still had not quite stabilized. I think we see that all sort of reconverging to a place of stability across the spectrum right now. And so if you take our macro index as a high-level indicator of where the aggregate numbers are on consumer repayments, we don't perceive there to be any real remaining segment differences. And that's why, as you may have heard in another announcement, we sort of announced that we're leaning in more confidently into the prime segment with the T-Prime program.

但我想，是的，感謝您回顧消費者還款和違約的趨勢以及其中的各個部分，我們確實指出了這樣一個事實，即較低的債務之間存在一些階段性差異。消費者受到的影響比優質消費者更早受到影響，可能早在2021 年末。完全穩定下來。我認為我們現在看到所有方面都重新趨於穩定。因此，如果您將我們的宏觀指數作為消費者還款總額的高級指標，我們認為不存在任何真正的剩餘細分差異。這就是為什麼，正如您可能在另一項公告中聽到的那樣，我們宣布我們將透過 T-Prime 計劃更加自信地進入黃金市場。

Great. Thank you very much.

偉大的。非常感謝。

Arvind Ramnani, Piper Sandler.

阿爾文德·拉姆納尼，派珀·桑德勒。

Hi, thanks for taking my question. I just kind of, David, I just want to go back to some of the comments you made on the kind of the opening remarks. Like some of your performance you said, or a lot of this performance is kind of driven by inherent improvements in your own kind of model and not as much with the kind of this lower interest rate cuts. I'd love to see if you can kind of expand on that a little bit more and provide some metrics and, and also if you can kind of give us an idea of how these lower interest rate rates will sort of add to some of the tailwinds that you're seeing.

您好，感謝您提出我的問題。大衛，我只是想回顧一下您在開場白中發表的一些評論。就像你所說的一些表現，或者說這種表現很大程度上是由你自己的模型的固有改進所驅動的，而不是由這種較低的降息驅動的。我很想知道您是否可以進一步擴展這一點並提供一些指標，並且您是否可以讓我們了解這些較低的利率將如何增加一些您所看到的順風。

Sure, Arvin, we got a little bit of help from interest rates that say the, the fed rates change and maybe a modest amount of support from that in September. So not all that meaningful over the course of the quarter, going forward, we certainly hope we'll get more boost. But, but really the growth in, in the third quarter was really due to model upgrades that we're upgrading our AI models constantly. But sometimes we get just small modest wins and other times we get very large wins.

當然，阿文，我們從利率方面得到了一些幫助，即聯準會利率變化，也許也從 9 月的利率變化中得到了一定程度的支持。因此，在本季中並不是那麼有意義，展望未來，我們當然希望我們能得到更多的推動。但是，第三季的成長實際上是由於我們不斷升級人工智慧模型的模型升級。但有時我們只會獲得微小的勝利，而有時我們會獲得非常大的勝利。

And model 18, which I first mentioned in the call three months ago was probably one of the bigger launches and upgrades to the system than we've had in quite some time. And what that really means is much more increased separation of risk, and that very commonly leads to higher conversion. You can think of it as basically -- it's identifying riskier people and eliminating them from the borrower pool, and the net-net is you can lower the rates and approve more other people. And also the level of automation is at our all-time high. Over 90% of the loans are fully automated. Both of those contribute to growth and to just getting more people through the funnel, which is very fundamental to those numbers that we put up there.

我三個月前在電話會議中首次提到的 Model 18 可能是我們相當長一段時間以來最大規模的系統發布和升級之一。這真正意味著更多地增加風險分離，這通常會帶來更高的轉換率。你可以將其視為基本上 - 它識別風險較高的人並將他們從借款人池中消除，而淨網是你可以降低利率並批准更多其他人。而且自動化水準也處於歷史最高水準。超過90%的貸款是完全自動化的。這兩者都有助於成長，並讓更多的人通過管道，這對於我們在那裡公佈的數字來說非常重要。

Terrific. And then, I think that if I heard you right, you said roughly half of your loan volume now is through committed capital. And if that's the case, As we look for the next couple of years, we get into a more normalized rate environment. When you think of committed capital versus opportunistic capital, how do you think that thing will balance? Before we went into this tough environment, you almost did not have a lot of committed capital, but now you're at about half of that. How do you think that will trend over the next couple of years?

了不起。然後，我想，如果我沒聽錯的話，您說現在大約一半的貸款量是透過承諾資本獲得的。如果是這樣的話，當我們展望未來幾年時，我們將進入一個更標準化的利率環境。當您考慮承諾資本與機會主義資本時，您認為如何平衡？在我們進入這個艱難的環境之前，你幾乎沒有太多的承諾資本，但現在你的承諾資本只有一半左右。您認為未來幾年的趨勢如何？

Sure, Arvind. Well, we'll say this. We certainly love having a significant portion of the capital being committed today. It may even be more than we would like. Historically, if you went back a couple of years, the funding on the platform was entirely at will, month-to-month, by design. And as we decided a couple of years ago, we wanted to start to have much more committed capital. Think of it more like a supply chain of capital and a little less like just a pure marketplace. And that's really helped, and that's what's really supplying a lot of the fuel for growth today is that well over half of it is committed capital. Having said that, I think there is a place for kind of a spot market, if you will, where capital can come and go. There's capital that will come in and will ultimately take loans to a securitization when the ABS markets are functioning. So I don't think we ever want 100% committed capital because there's this kind of market creation happens with app will capital as well. So a healthy balance will be good. But certainly we like today having a lot of committed capital, a lot of long term partners that we can create a lot of value for and they can create value for us as well.

當然，阿爾文德。好吧，我們就這樣說吧。我們當然喜歡今天投入很大一部分資金。它甚至可能比我們想要的還要多。從歷史上看，如果你回到幾年前，平台上的資金完全是按照設計按月隨意分配的。正如我們幾年前決定的那樣，我們希望開始擁有更多的承諾資本。可以把它想像成一個資本供應鏈，而不是純粹的市場。這確實很有幫助，而真正為當今的成長提供大量動力的是，其中超過一半是承諾資本。話雖如此，我認為如果你願意的話，有一個現貨市場的地方，資本可以在其中進出。當 ABS 市場發揮作用時，資本將會進入並最終將貸款用於證券化。所以我認為我們永遠不會想要 100% 的承諾資本，因為應用程式資本也會創造這種市場。因此，健康的平衡是有好處的。但我們當然喜歡今天擁有大量的承諾資本、大量的長期合作夥伴，我們可以為他們創造很多價值，他們也可以為我們創造價值。

Perfect. That's really helpful. Thank you very much. I'll hop back. Thank you.

完美的。這真的很有幫助。非常感謝。我會跳回來。謝謝。

James Fawcett, Morgan Stanley.

詹姆斯‧福西特，摩根士丹利。

Hi everyone, it's Michael in Fontana for James. Thanks for taking our question. I just wanted to ask on the small-dollar loans, obviously reaching break-even economics here, like how should we be thinking about incremental variable cost reduction there and sort of the impact on approval rates broadly?

大家好，我是詹姆斯豐塔納的麥可。感謝您提出我們的問題。我只是想問一下小額貸款，顯然這裡達到了收支平衡的經濟效益，例如我們應該如何考慮那裡增量可變成本的降低以及對廣泛批准率的影響？

Sure, Michael. This is Dave. The small-dollar product essentially is really kind of a way to get somebody into the system who wouldn't be approved for a larger loan, generally speaking. And it is generating positive economics. It's actually not a drain in us whatsoever. They're very short-term loans. The capital turns over super quickly. So I don't think we see that as any kind of drain on the system. They are, as I said, positive economics. It's really expanding the boundary of who we can approve. A lot of those small-dollar borrowers will come back later and get personal loans or maybe refinance an auto loan, etc. So for us, it's really helpful. It's also helping train our AI models on a lot of borrowers that it would not have otherwise seen. So it kind of keeps pushing the boundaries of what we can improve. I don't know, Sanjay, if you want to add anything to that.

當然，邁克爾。這是戴夫。一般來說，小額產品本質上是一種讓那些不會被批准獲得大筆貸款的人進入系統的一種方式。它正在產生積極的經濟效益。實際上，這對我們來說並不是一種消耗。它們是非常短期的貸款。資本週轉速度超快。所以我認為我們不會將其視為系統的任何形式的消耗。正如我所說，它們是積極的經濟學。這確實擴大了我們可以批准的範圍。許多小額借款人稍後會回來獲得個人貸款，或者可能為汽車貸款再融資等。它還幫助我們在許多藉款人身上訓練我們的人工智慧模型，否則這些借款人是不會看到的。因此，它不斷突破我們可以改進的界限。我不知道，Sanjay，您是否想對此添加任何內容。

No, I think that's a pretty good description.

不，我認為這是一個很好的描述。

Okay, great. And maybe just one sort of question on impact of a change in administration broadly. I know it's obviously tough to prognosticate about direction of the overall unemployment rate, but if we are in this world in which unemployment rate is lower, credit is generally better, how are you thinking about sort of like run rate origination trajectory that we should be cognizant of over the next, call it, 12 to 18 months?

好的，太好了。也許只是關於行政更迭的廣泛影響的一類問題。我知道預測整體失業率的走向顯然很困難，但如果我們生活在一個失業率較低、信貸普遍較好的世界，您如何考慮我們應該採取的運行率起源軌跡知道接下來的12 到18 個月嗎？

With respect to the administration, I think the market, as you can see in the last day or so, kind of likes a business-friendly Republican administration historically, so that's maybe not a surprise. But having said that, our business has grown up through four different administrations and had very engaged relationships with regulators under each of them, so we don't really see which party is in power in D.C. as a central factor in our business. We've made a ton of progress working with regulators, particularly around the use of AI and fairness in lending and those kinds of issues, so we feel very good about that. Generally speaking, our growth as a company has almost always come internally, not externally. meaning improvements in the models and getting more and more funding, improving models, being able to approve more people, these new products that are coming out appealing to a different set of people. The T-Prime program now has more competitive offers for much more prime borrowers. So all these are the kind of things that we just keep, I think we can grow on.

就政府而言，我認為市場，正如你在最後一天左右所看到的，有點喜歡歷史上對商業友好的共和黨政府，所以這可能並不令人意外。但話雖如此，我們的業務是在四屆不同的政府中成長起來的，並且與每個政府的監管機構都有著非常密切的關係，因此我們並不真正認為哪個政黨在華盛頓執政是我們業務的核心因素。我們與監管機構合作取得了很大進展，特別是在人工智慧的使用和貸款公平性以及此類問題方面，因此我們對此感到非常滿意。一般來說，我們作為一家公司的成長幾乎總是來自內部，而不是外部。意味著模型的改進，獲得越來越多的資金，改進模型，能夠批准更多的人，這些新產品的出現吸引了不同的人群。 T-Prime 方案現在為更多優質借款人提供更具競爭力的優惠。所以所有這些都是我們保留的東西，我認為我們可以繼續成長。

And certainly, as the consumer risk drops, the Upstart macro index, as that goes down, that is certainly a tailwind to us as is fed rates, the benchmark rates going down. So those are all good things, but it's a kind of said in the remarks, we aren't waiting around for fed rates to drop or for I itself to drop, we really believe we can drive consistent growth really through just the kind of improvements we make for our models quarter in and quarter out.

當然，隨著消費者風險的下降，新貴宏觀指數的下降，對我們來說無疑是個順風，聯準會利率、基準利率也會下降。所以這些都是好事，但在評論中可以說，我們不會等待美聯儲利率下降或我本身下降，我們真的相信我們可以通過這種改進來推動持續增長我們每時每刻都在製作我們的模型。

That's great color. Appreciate it.

那顏色真棒。欣賞它。

Rob Wildhack, Autonomous Research.

Rob Wildhack，自主研究。

Hi guys. I wanted to ask about T-Prime and your expansion into SuperPrime. Can you just fill us in on how you get paid in that business? Is it any different? And then how do the take rates and contribution margins compare to the core business?

嗨，大家好。我想詢問有關 T-Prime 以及你們向 SuperPrime 擴張的情況。您能告訴我們您在該業務中如何獲得報酬嗎？有什麼不同嗎？那麼，與核心業務相比，收取率和貢獻率如何？

Sure Rob, that's a good question. Essentially, we don't do any loans that there aren't positive unit economics on. We would never do this in a way that we would intentionally lose money on the loan. So they are positive, but certainly across the spectrum, the more prime you are, the more you're at that end of the spectrum, the thinner margins are because you have just a more heavily competed consumer And what we were really able to do with our lending partners is find something that works for them in terms of relatively low loss rate product, which is very good for our credit union and bank partners. It has a nice yield, and we make less on it, but we have a very positive contribution margin. If you look at our business today, contribution margins are super high compared to where they were historically. in the range of 60%, whereas in the middle of 2021, they were in the mid-40s, I believe. So we expect our contribution margins to come back down to earth as our volumes expand. And we don't think T-Prime is going to upset that in any dramatic way. But this is essentially also important to say, this is sort of a part of the market we have just not participated in historically. So regardless of the percent contribution margin, these are contribution dollars that we would not otherwise have, and that's how we would think about it.

當然，羅布，這是個好問題。本質上，我們不會發放任何沒有積極單位經濟效益的貸款。我們絕不會以故意在貸款上損失金錢的方式這樣做。所以它們是積極的，但肯定是在整個範圍內，你越是優質，你越處於該範圍的一端，利潤就越薄，因為你的消費者競爭更加激烈，而我們真正能夠做什麼與我們的貸款合作夥伴一起找到適合他們的損失率相對較低的產品，這對我們的信用合作社和銀行合作夥伴非常有利。它的收益率很高，我們賺的錢較少，但我們有非常積極的邊際貢獻。如果你看看我們今天的業務，你會發現與歷史相比，邊際貢獻率非常高。我認為，這一比例在 60% 左右，而到 2021 年中期，這一比例在 40 多歲左右。因此，我們預期隨著銷售量的擴大，我們的邊際貢獻率將回落至正常水準。我們認為 T-Prime 不會以任何戲劇性的方式顛覆這一現狀。但這本質上也很重要，這是我們歷史上從未參與過的市場的一部分。因此，無論邊際貢獻百分比如何，這些都是我們原本不會擁有的貢獻資金，這就是我們的想法。

Okay, thanks. And then, somewhat relatedly, just wanted to get your thoughts on the broader competitive landscape. You're going into SuperPrime with T-Prime. You have someone like SoFi who's doing their own loan platform business that seems to be targeted more towards your main demographic. What do you guys think about all of that? How intense do you feel the competition is today? And then, how do you manage around that competition to make sure you're protecting your targeted cash flows going forward?

好的，謝謝。然後，與此相關的是，我只是想了解您對更廣泛的競爭格局的看法。您將與 T-Prime 一起進入 SuperPrime。像 SoFi 這樣的公司正在進行自己的貸款平台業務，該業務似乎更針對您的主要受眾。你們對此有何看法？您覺得今天的競爭有多激烈？然後，您如何應對競爭，以確保保護未來的目標現金流？

Yeah, I mean, we've always operated in a very competitive environment. In some sense, from a consumer perspective, a loan is a loan. And for us, having proprietary underwriting that we think is creating separation has always been the center of our thesis, we can improve more people at lower rates. We can avoid the people you don't want to lend to.

是的，我的意思是，我們一直在競爭非常激烈的環境中運作。從某種意義上來說，從消費者的角度來看，貸款就是貸款。對我們來說，擁有我們認為會造成分離的自營承保一直是我們論文的中心，我們可以以更低的費率改善更多的人。我們可以避開您不想藉錢給的人。

And increasingly with what we talked about with T-prime is we can compete across the credit spectrum. So, certainly there'll always be a lot of competition. But we like our model, it can be a loan can be originated and held by a credit union or a bank at a very modest yield and a very low risk. We also have a relationship with the private credit market, very successful in ABS. So there's just, I think, a platform that can move really quickly. And I think controlling all parts of this from the data that's collected, that the model is trained on, servicing these loans, etc., means it's a very healthy approach we have. A lot of competition has very different models out there, whether they be banks or other types of fintechs, but we like our play in it. But it's a vast market and there's room for multiple players for sure.

我們與 T-prime 越來越多地談論的是我們可以在整個信貸領域中競爭。所以，當然總是會有很多競爭。但我們喜歡我們的模式，它可以是由信用合作社或銀行以非常適度的收益率和非常低的風險發起和持有的貸款。我們也與私人信貸市場建立了關係，在資產支持證券方面非常成功。所以我認為，只有一個可以快速發展的平台。我認為，透過收集的數據、模型訓練的數據、為這些貸款提供服務等來控制這一切，意味著這是我們採取的一種非常健康的方法。許多競爭都有非常不同的模式，無論是銀行或其他類型的金融科技公司，但我們喜歡我們在其中的表現。但這是一個廣闊的市場，肯定有容納多個參與者的空間。

Very helpful. Thank you.

非常有幫助。謝謝。

Kyle Peterson, Needham.

凱爾彼得森，尼達姆。

Hey. Good afternoon, guys. Thanks for taking the questions. I want to start off on the rate cut commentary. You just mentioned in your prepared remarks that the September cut is expected to work its way into the fourth quarter, if there's further easing and, and we had to cut today, should we think about these as being potential tailwinds at like a one to two quarter lag or, or is there another way to, to kind of incorporate that into our own assumptions?

嘿。下午好，夥計們。感謝您提出問題。我想從降息評論開始。您剛剛在準備好的演講中提到，如果有進一步的寬鬆政策，九月份的降息預計將持續到第四季度，而且我們今天不得不降息，我們是否應該將這些視為潛在的推動因素，例如一比二四分之一滯後，或者有其他方法可以將其納入我們自己的假設中嗎？

I'll take that one. I think that's roughly right. A rate cut by the Fed first requires warehouses and other financing mechanisms to adjust, and then thereafter we'll begin to reflect that in our core pricing. And so I think a lag of one to three months is probably reasonable.

我會接受那個。我認為這大致是正確的。聯準會降息首先需要倉庫和其他融資機制進行調整，然後我們將開始在我們的核心定價中反映這一點。因此，我認為延遲一到三個月可能是合理的。

Okay, that's helpful. And then maybe switching gears, I know you guys mentioned the average loan size was a little bigger, and part of that's due to model improvements. Maybe any thoughts about does that impact some of the progress or initiatives you guys had been making on the small-dollar product, or does that now get shifted to a different type of consumer? If some of those guys that were taking the smaller loans can now qualify for longer ones, just how that fits into the near-term growth algorithm would be very helpful.

好的，這很有幫助。然後也許換個方式，我知道你們提到平均貸款規模有點大，部分原因是模型的改進。也許有任何想法，這是否會影響你們在小美元產品上取得的一些進展或舉措，或者現在是否會轉移到不同類型的消費者？如果那些接受較小貸款的人現在有資格獲得長期貸款，那麼這如何適應近期成長演算法將非常有幫助。

Yeah, I guess in the grand scheme of things, when either risk is lower or required returns are lower and more people can qualify for larger loans, it does mean that less of them are taking what they otherwise would have been offered, which is maybe a smaller dollar loan. I think that overall is good for the ecosystem and for the borrowers. It may have, obviously, impacts on average metrics like loan size, etc., but I think overall we would view that as a positive in the environment.

是的，我想從長遠來看，當風險較低或要求的回報較低並且更多的人有資格獲得更大的貸款時，這確實意味著更少的人接受他們本來會提供的東西，這可能是較小的美元貸款。我認為總體而言，這對生態系統和借款人都有好處。顯然，它可能會對貸款規模等平均指標產生影響，但我認為總體而言，我們會認為這對環境有利。

Got it. That's helpful. Thank you.

知道了。這很有幫助。謝謝。

David Schwartz, Citizens JMP.

大衛·施瓦茨 (David Schwartz)，公民 JMP。

Hi, good afternoon. Thanks for taking my questions. Most have been answered, but just two quick follow-ups. First, on the expense side, Sanjay, I think you said there were some catch-up accruals in the third quarter, and I'm wondering If you could quantify how much of Q3 expense levels might be non-recurring and how much specifically in the fourth quarter we should think of for marketing.

嗨，下午好。感謝您回答我的問題。大多數已經得到答复，但只有兩個快速跟進。首先，在費用方面，桑傑，我認為您說過第三季度有一些追趕性應計費用，我想知道您是否可以量化第三季度的費用水平有多少可能是非經常性的，以及具體有多少是在第四季我們應該考慮行銷。

Yeah, I think, let me just, on the back of a cocktail napkin, I think you could think of that as sort of like $5 million-ish in excess expense that maybe was otherwise would have been sort of captured earlier in the year and was sort of captured as a one-time catch-up this quarter.

是的，我想，讓我簡單說一下，在雞尾酒餐巾紙的背面，我想你可以將其視為 500 萬美元左右的超額費用，否則這些費用可能會在今年早些時候被捕獲，並且本季度有點被視為一次性追趕。

Okay. In a Q4 marketing spend, just given the -- as we think about CAC, similar to third quarter levels?

好的。在第四季的行銷支出中，正如我們對 CAC 的看法，與第三季的水平類似？

Yeah. I don't perceive there to be any large changes coming.

是的。我認為不會發生任何重大變化。

Okay.

好的。

And then just lastly, on the funding side, I think earlier in the year-correct me if I'm wrong-I think the Castle Lake arrangement included some form of risk sharing or mandated risk retention. Is that the case with Adelia recent deals, or are these just kind of strict flow arrangements?

最後，在資金方面，我想在今年早些時候——如果我錯了，請糾正我——我認為 Castle Lake 的安排包括某種形式的風險分擔或強制風險保留。 Adelia 最近的交易就是這種情況嗎？

The Adelaide deal has a version of co-investment where we're investing alongside them.

阿德萊德交易有一個共同投資的版本，我們與他們一起投資。

Okay, got it. Great. Thank you.

好的，明白了。偉大的。謝謝。

Simon Clinch, Redburn Atlantic.

西蒙‧克林奇，《雷德本大西洋月刊》。

Hi, everyone. Hi. Thanks for taking my question. I was wondering, Dave or Sandhya, could you talk a bit about the conversion rates and how we should think about that progressing as model 18 really starts to drive through and I asked this because while you delivered some great upside to numbers this quarter, I thought the conversion rate would have been higher to deliver that and it, it only went up 100 basis points or so. So I was just curious as to how to think about that going forward.

大家好。你好。感謝您提出我的問題。我想知道，Dave 或Sandhya，你們能否談談轉換率，以及隨著Model 18 真正開始普及，我們應該如何考慮這一進展，我問這個問題是因為，雖然你們本季度的數字取得了一些巨大的成長，但我以為實現這一目標的轉換率會更高，但實際上，它只上升了 100 個基點左右。所以我只是好奇如何思考未來的發展。

Sure. I mean, conversion rate getting higher is a good thing. It sort of contributes directly to growth. It's not the only thing that contributes to growth, so depending on how acquisition is working, etc. But you should expect when we make model improvements, when we increase automation, things of that nature, it will drive conversion rate up. But there's always this sort of trade-off where suddenly it makes sense to spend more on marketing or some other type of expense, and it can drive it back down. So conversion rate doesn't grow to the sky, if you will, because there will always be an interest from our side in, in effect, investing more once conversion rate reaches a certain point.

當然。我的意思是，轉換率提高是件好事。它在某種程度上直接促進了成長。這並不是唯一有助於成長的因素，因此取決於收購的運作方式等。但總是存在這種權衡，突然之間，在行銷或其他類型的開支上投入更多資金是有意義的，並且它可以降低成本。因此，如果您願意的話，轉換率不會飆升，因為實際上，一旦轉換率達到某個點，我們總是會進行更多投資。

Right. And if I go back in time, I remember in the earlier days, I think we used to talk about a conversion rate of 22% being sort of optimal. So has that changed?

正確的。如果我回到過去，我記得在早些時候，我想我們曾經談論過 22% 的轉換率是最佳的。那麼情況發生了變化嗎？

Hey Simon, this is Sanjay. So maybe one additional consideration that's newer in this multi-product world than in the old days when we were really largely a single product is that, for example, we were converting some people into small-dollar loans, and as the model accuracy improves, more of those are being converted into full personal loans. And so that's not an improvement to conversion per se, because each one of those is counted as a convert. It's just a much more lucrative conversion. So I think maybe what we can try to do over the next couple of quarters is give you guys more insight into product-level conversion, where it'll be more meaningful to the economics.

嘿西蒙，這是桑傑。因此，也許在這個多產品世界中，比過去我們主要是單一產品時更新的一個額外考慮因素是，例如，我們將一些人轉換為小額貸款，並且隨著模型準確性的提高，其中更多正在轉換為全額個人貸款。因此，這本身並不是轉換率的改進，因為其中每一個都被視為轉換者。這只是一個更有利可圖的轉換。因此，我認為也許我們在接下來的幾季可以嘗試做的是讓大家更深入地了解產品級轉換，這對經濟更有意義。

That'd be great. Appreciate it. Thank you so much. Thank you, Simon.

那太好了。欣賞它。太感謝了。謝謝你，西蒙。

Giuliano Bologna, Compass Point.

朱利亞諾·博洛尼亞，指南針點。

Well, congratulations. It's great to see the continued progress securing committed funding arrangements. I guess on that topic, it looks like the co-investor capital or the assessed value moved up about $100 million in quarter. I'm curious about when you think about a go-forward basis, is there a rough sense of how fast that should be growing quarter over quarter, especially as volumes continue to improve from here. And also, is there an upper bound to where you'd want that to be relative to capital or cash? And hopefully not too compounded the question, but then I'd be curious roughly where the percentages are, what kind of car is outstanding relative to that as of the third quarter?

好吧，恭喜你。很高興看到在確保承諾的資金安排方面取得了持續進展。我想就這個主題而言，聯合投資者資本或評估價值似乎在本季增加了約 1 億美元。我很好奇，當你考慮未來的基礎時，是否有一個粗略的感覺，即每個季度的成長速度應該有多快，特別是隨著銷售量從現在開始持續改善。另外，您希望相對於資本或現金的上限是否存在？希望這個問題不會太複雜，但是我很好奇大致的百分比在哪裡，相對於第三季而言，哪種汽車表現出色？

Yeah. Hi, Giuliano. This is Sanjay. Hope you're well. So I think the rough framework or the rough model you can use to think about this, and we've sort of signaled this in the past, is that in these particular deals, we expect to be somewhere in the mid to high single digits as a co-investment. And I think that's generally true and it continues to be true.

是的。嗨，朱利亞諾。這是桑傑。希望你一切都好。因此，我認為您可以用來考慮這個問題的粗略框架或粗略模型，我們過去已經發出過這樣的信號，即在這些特定交易中，我們預計會達到中高個位數的水平共同投資。我認為這通常是正確的，而且仍然是正確的。

Now, I think in quarters where we sign big deals, such as the Blue Owl slash Adelia deal, and very often those deals are accompanied by large back-book transactions as well in order to cede the relationship and, and sort of cede the utilization of the financing facilities, then there can be a bigger one time sort of jump in the committed capital dollars level.

現在，我認為在我們簽署大筆交易的季度，例如 Blue Owl 削減 Adelia 交易，而且這些交易通常還伴隨著大量的後台交易，以便放棄關係，並在某種程度上放棄利用率如果融資設施的數量增加，那麼承諾的資本美元水準可能會出現更大的一次性跳躍。

And that's true this quarter as a result of the blue deal, those are more a function of deal signings than ongoing forward flow investment. But I think writ large, I think a mid to high single digit percentage of the flow, which is committed, and as Dave said, that's sort of somewhere over half of our total volume right now, is the right amount for us to scale on.

由於藍色協議，本季情況確實如此，這些更多是協議簽署的結果，而不是持續的遠期投資。但我認為，從大的角度來看，我認為已承諾流量的中高個位數百分比，正如戴夫所說，這相當於我們目前總流量的一半以上，是我們擴展規模的正確金額。

And the total amount that we're comfortable with, I think, is really a function of the size and scale of our platform because, obviously, as it gets bigger and as our business is throwing off more money, we're able to put more of it in dollar terms into these arrangements. But I think that overall, as a percentage of the total volume we're doing, it should be some single-digit percentage.

我認為，我們感到滿意的總金額實際上是我們平台的規模和規模的函數，因為顯然，隨著平台變得越來越大，隨著我們的業務投入更多資金，我們能夠投入更多資金更多以美元計價的資金投入這些安排。但我認為總體而言，作為我們正在做的總量的百分比，它應該是個位數的百分比。

That's helpful. And I guess from an exposure perspective, should we just think about somewhere in the mid to high single digits, is what that 334 represents? Or is there any kind of, like, ballpark of what the principal exposure looks like at this point?

這很有幫助。我想從曝光的角度來看，我們是否應該考慮中高個位數的某個地方，334 代表什麼？或者，目前主要風險敞口是否存在某種大致情況？

Yeah, that $334 million is a mid-single-digit percentage of the total amount of origination dollars that it was used to generate.

是的，這 3.34 億美元佔其所產生的創始資金總額的中等個位數百分比。

That's very helpful. And then I'd be curious, do you have any sense of where the take rate moved this quarter? I realize we'll get the data from the Time Cube, but I'm curious when we think about kind of the gross take rate, movement, I'm assuming is drifting a little bit lower as you add a little bit more prime. Hopefully that's a good way of thinking of it. And I'm curious if you can give a rough sense of -- are some of the higher prime loans coming on with a low, single-digit take rate or a mid single-digit take rate or any -- a rough sense of where that -- some of the high prime loans might be coming on?

這非常有幫助。然後我很好奇，您是否了解本季的轉換率變化？我意識到我們將從時間立方體中獲取數據，但我很好奇，當我們考慮總採用率、移動時，我假設當您添加更多素數時，它會稍微降低一點。希望這是一個很好的思考方式。我很好奇你是否能粗略地了解一些較高的優質貸款是否具有低個位數的貸款利率或中等個位數的貸款利率或任何其他的粗略的感覺一些高額優質貸款可能會出現？

Yeah, sure. Giuliano, I think that the take rate is in roughly the same ballpark as in prior quarters. I think in this particular quarter, it may be very slightly down. Some of it has to do with the mix between institutional funding and LP funding. Some of it is maybe a function of this T-Prime program that we're scaling, which, as Dave said, has smaller but still positive margins. And some of it is, frankly, experimentation as we scale. We're always trying to find the optimum elasticity, or the optimum price given elasticity in different segments. And that allows us to experiment a little bit with some percentage of our traffic.

是的，當然。朱利亞諾，我認為採用率與前幾季大致相同。我認為在這個特定季度，它可能會略有下降。其中一些與機構資金和有限合夥人資金的混合有關。其中一些可能是我們正在擴展的 T-Prime 計劃的一個功能，正如戴夫所說，該計劃的利潤較小，但仍然為正。坦白說，其中一些是我們規模化的實驗。我們一直在努力尋找最佳彈性，或在不同細分市場給定彈性的情況下找到最佳價格。這使我們能夠用一定比例的流量進行一些實驗。

And I think the combination of those three create a bit of push and pull with take rates. But net, net I think they're, they're in the same ballpark, maybe marginally lower than last quarter.

我認為這三者的結合會對轉換率產生一定的推動和拉動。但我認為淨值、淨值處於同一水平，可能略低於上季。

That's very helpful. I appreciate the time and I'll jump back in the queue.

這非常有幫助。我很感謝您的時間，我會插回隊列中。

And there are no further questions at this time. I will now turn the conference back to Dave Girard for any additional or closing remarks.

目前沒有其他問題。現在我將把會議轉回戴夫·吉拉德（Dave Girard）發表任何補充或結束語。

I just want to say thanks to all for joining us today. We're excited about our position and our velocity toward the future. We think our business is really beginning to hit on all cylinders again. We appreciate you joining us, especially during this super busy week, and we look forward to talking to you again in the new year. Thanks for joining.

我只想對大家今天加入我們表示感謝。我們對我們的地位和我們邁向未來的速度感到興奮。我們認為我們的業務真的開始再次全速前進。我們感謝您加入我們，特別是在這超級忙碌的一周，我們期待在新的一年裡再次與您交談。感謝您的加入。

This concludes today's call. Thank you for your participation. You may now disconnect.

今天的電話會議到此結束。感謝您的參與。您現在可以斷開連線。