US lender Upstart cuts 140 jobs as loan demand drops
California-based lending platform Upstart has shed around 7% of its workforce, citing a “challenging economy” and a reduction in the number of loans on its platform.
Upstart sheds 7% of its workforce
According to filings signed off by chief financial officer Sanjay Datta at the US Securities and Exchange Commission (SEC), on 1 November the firm notified around 140 employees who help process loan applications that their positions had been “eliminated”.
As a result of the layoffs and the reduction in loan volumes, Upstart shares tumbled throughout the course of the day, finishing 4.4% down at $22.17 per share on the Nasdaq stock exchange. Shares have continued to fall today, and at time of writing the price currently stands at $20.84.
In its Q2 results released in August, the company reported a 72% annual increase in loan volumes from 456,610 in H1 2021 to 786,675 in the same period a year later. The firm is expected to post its Q3 2022 earnings on 8 November.
Confirming the number of layoffs, an Upstart spokesperson told FinTech Futures: “Given the challenging economy, we are making this difficult decision for the long-term health of the company. We do not expect any further layoffs and continue to hire for roles that are strategic to our business.”
Upstart joins an ever-increasing list of fintechs hit by the current economic volatility and uncertainty.
Brex and MX announced layoffs last month, joining Indonesian fintech Xendit, BNPL giant Klarna, African challenger Kuda and Aussie crypto exchange Swyftx, among others.
