LendingClub Gains 21% While CE 100 Index Struggles

The Connected Economy 100 index had a tough week, losing 4.2% percent across all pillars except “eat.” While the index was down overall due to big drops at several companies, including double digits at Xero, iRobot, and United Healthcare, there were some notable highlights. Among them:

LendingClub was up 21% for the week on strong earnings. The company’s second-quarter call painted a picture of borrowers who are borrowing more, paying better and sticking around. Personal-loan originations climbed 32% from a year earlier to $2.4 billion, helped by repeat customers who still account for roughly half of the volume. In comparison, the net charge-off ratio for loans held on the bank’s books fell to 3%, about half last year’s level. Strong credit trends let the company boost loan sales and net interest income, driving total revenue up 33% to $248 million and GAAP profit to $38 million. Deposit-gathering also accelerated: LevelUp Savings balances reached $2.7 billion, and the recently launched LevelUp Checking has spurred a six-fold jump in daily account openings, with close to 60% coming from existing borrowers — evidence that customers are deepening relationships rather than shopping elsewhere.

Management cited “very high” marketplace demand for its paper, extending a Blue Owl funding pact and inking a first BlackRock transaction. As Chief Executive Scott Sanborn put it, “We’re not only consistently beating our competition, but we’re also beating our own expectations… our data is demonstrating the effectiveness of our underwriting and the resilience of our borrower base.”

Cognex also posted strong earnings, leading to a 19% bounce. The maker of machine-vision cameras and AI software that helps factories and warehouses inspect products, track packages and guide robots said second-quarter revenue rose 4% to $249 million — its fourth straight quarter of organic growth — while disciplined spending lifted adjusted EBITDA margin to 20.7 %, the best showing in two years. Demand was broad-based: logistics booked a sixth consecutive period of double-digit gains, packaging sales grew mid-single digits on strength in healthcare and fast-moving consumer goods, and consumer-electronics orders stayed robust as device makers retooled overseas supply chains. Free cash flow reached $40 million, pushing 12-month conversion to 130 % of earnings, and management projected up to 9 % sales growth in the current quarter.

“The momentum we saw in Q1 continued in Q2 with revenue of $249 million increasing 4 % year-on-year… our sales-force transformation is already generating good results and is an important component of this strategy,” Chief Executive Matthew Moschner told analysts.

CyberArk rounded out the winners for the week. Its strong performance comes from the announcement that Palo Alto Networks, a heavyweight in AI-driven network, cloud and security-operations software, agreed to buy the company, which pioneered privileged-access and identity-security tools, in a cash-and-stock deal worth roughly $25 billion. CyberArk holders will receive $45 in cash and 2.2005 Palo Alto shares for each share they own — about a 26% premium to the stock’s 10-day average — and the news sent CyberArk shares sharply higher while positioning Palo Alto to add identity protection as a fourth pillar of its platform strategy. Management pitched the move as the right bet for an AI era that is spawning a boom in machine and agent identities:

“Our market entry strategy has always been to enter categories at their inflection point, and we believe that moment for Identity Security is now,” Palo Alto Chief Executive Nikesh Arora said, calling CyberArk “the definitive leader” in the niche. CyberArk founder Udi Mokady framed the tie-up as an acceleration of his company’s two-decade mission, saying the combination “will bring unmatched expertise across human and machine identities, privileged access, and AI-driven innovation to secure what’s next.”