Upstart Holdings (UPST) - Get Free Report shares nearly doubled on Thursday after the artificial intelligence lending platform said it agreed to buy Prodigy Software, a provider of cloud-based automotive retail software.
Terms weren't disclosed.
Upstart, San Mateo, Calif., also reported a 38% revenue bump for its fourth quarter.
Its shares recently traded at $119,31, up 96% from Wednesday's close. They have more than tripled since the company went public in December.
As for the Prodigy purchase, “While Amazon (AMZN) - Get Free Report and Shopify (SHOP) - Get Free Report have modernized the online shopping experience, the auto industry has been left behind,” said Dave Girouard, chief executive of Upstart.
“Upstart is on a path to reduce the cost of auto financing, and we can accelerate this opportunity with a modern multichannel purchase experience.”
By acquring Prodigy, Upstart will speed its efforts to offer AI-enabled auto loans through the tens of thousands of auto dealers nationwide, where the majority of auto loans are originated, the company said.
More than $2 billion in vehicle sales have been financed by Prodigy, Upstart said. The deal is expected to close in the second quarter.
As for Upstart’s earnings, revenue reached $84.4 million in the fourth quarter from $61.1 million last year.
Net income registered $1 million, or break-even per share, down from $6.1 million, or 6 cents a share, in the year-earlier period.
Upstart soared nearly 50% on its first day of trading Dec. 16, after pricing its IPO at the low end of its projected range.
The fintech company priced its offering of 9 million shares at $20. Its stock closed that day at $29.47.