(Reuters) – Shares of Upstart Holdings Inc jumped 30% in their market debut on Wednesday, giving the cloud-based artificial intelligence (AI) lending platform a market capitalization of $1.88 billion.
Upstart’s shares opened at $26 on the Nasdaq, above their initial public offering (IPO) price of $20 per share. The firm had raised $240.4 million in its IPO on Tuesday.
The AI-based lender had planned to sell 12.02 million shares priced between $20 and $22 apiece.
A recent regulatory filing by the fintech company showed it earned a surprise profit of $4.96 million on a revenue of $146.7 million in the nine months ended Sep. 30.
The fintech company counts Khosla Ventures, Third Point Ventures and First National Bank of Omaha among its investors.
Upstart’s business has been affected by the COVID-19 pandemic, the filing showed, as loan origination volumes on its platform fell and availability of loan funding from institutional investors reduced.
The company also outlined in its filing that it may not be able to maintain or increase its profitability in the future, adding that its quarterly results may fluctuate.
Goldman Sachs, BofA Securities and Citigroup Inc were the lead underwriters for the offering.
Reporting by Sohini Podder in Bengaluru; Editing by Vinay Dwivedi