AI lending platform Upstart has laid off 7 per cent of its total workforce (around 140 employees), as it faces weakening demand for loans in the US due to significant hikes in interest rates.
The lending platform which has about 2,000 employees, notified its affected employees about the layoff on Tuesday, reports TechCrunch.
“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,” an Upstart spokesperson said in a statement.
In its latest filing with the US Securities and Exchange Commission (SEC), it said the decision was due to ongoing economic challenges and the “reduction in the volume of loans” on its platform.
In its last quarterly results, the platform registered a 72 per cent annual increase in loan volumes on its platform.
The company’s share price dropped by 84 per cent this year.
The market cap of Upstart once reached $32 billion. It is now less than $2 billion.
Rough economic conditions have hit several technology companies globally, including in India, as startups face an acute funding crunch.