Upstart's AI Lending Model Faces Its Toughest Test if Rates Stay High

Upstart, an AI-powered lending marketplace, faces headwinds as investors worry about potential interest rate hikes in 2026. While the company has strengthened its position with $4 billion in committed capital and shifted toward collateralized loans, its stock has declined 50% over the past year amid rate concerns. Despite optimistic guidance for 40% revenue growth and improving margins through 2028, the company will likely remain out of favor until rate hike fears subside.