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Chime Financial, Inc. (CHYM)·Q2 2025 Earnings Summary

Executive Summary

  • Q2 2025 delivered accelerating top-line momentum with revenue of $528.1M, up 37% year over year, and non-GAAP adjusted EBITDA of $16.0M (3% margin); GAAP net loss was driven by IPO-related stock-based compensation expense and payroll taxes totaling ~$928M .
  • Revenue beat Wall Street consensus by ~5% ($528.1M vs. $502.8M); GAAP EPS missed due to IPO-related items (reported -$7.29 vs. consensus -$4.97). Bold drivers were strength in MyPay economics and continued payments scale; the principal negative surprise was GAAP EPS optics from one-time IPO SBC .
  • Guidance raised vs prior internal expectations: Q3 revenue $525–$535M and adjusted EBITDA $12–$17M (2–3% margin); FY 2025 revenue $2.135–$2.155B and adjusted EBITDA $84–$94M (4% margin), with incremental adjusted EBITDA margins returning to mid-40%+ by Q4 .
  • Catalysts: faster-than-planned improvement in MyPay loss rates (140 bps in Q2 vs. >160 bps in Q1), tripling MyPay transaction margin QoQ; scaling Instant Loans and Chime+; AI-driven cost leverage and ChimeCore migration underpinning operating efficiency .

What Went Well and What Went Wrong

What Went Well

  • MyPay economics materially improved: loss rates moved to ~140 bps from just over 160 bps in Q1, enabling a tripling of MyPay transaction margin QoQ; faster-than-planned progress points toward ~1% steady-state loss rates .
  • Payments scale and durability: purchase volume reached $32.4B (+18% YoY), with resilient, non-discretionary spend cohorts; payments revenue grew 19% YoY to $366M .
  • AI and platform efficiency: GenAI voice bot doubled satisfaction vs legacy voice, and AI handles the work of thousands of support agents; migration of all new accounts to ChimeCore accelerates product velocity and cost savings .
  • Quote: “AI powered tools now fully automate the majority of our support interactions and do the work of thousands of human agents” — CEO Chris Britt .

What Went Wrong

  • GAAP optics: Q2 GAAP net loss of $923.4M and GAAP EPS of -$7.29, driven largely by IPO-related stock-based compensation and payroll tax (~$928M) rather than core operations .
  • Transaction margin YoY compression to 69% (from 78%) reflecting MyPay scaling; though economics are improving, margins remain below FY 2024 levels as the product matures .
  • Per-active spend mixed shift: newer, ungated “day one” users and lower inflation (vs. 2022’s high) moderated spend per active; management emphasized the strategy is increasing activation and funnel size, but near-term per-active spend metrics show pressure .

Financial Results

Core P&L and Margins vs Prior Periods

MetricQ2 2024Q1 2025Q2 2025
Revenue ($USD)$384.214M $518.744M*$528.149M
Net Income ($USD)$0.385M $12.939M*$(923.376)M
Diluted EPS ($USD)N/A $0.1964*$(7.29)
Gross Profit ($USD)$333.710M $458.326M*$461.029M
Gross Margin (%)87% 88.35%*87%
Transaction Profit ($USD)$298.710M N/A$362.782M
Transaction Margin (%)78% N/A69%
Adjusted EBITDA ($USD, non-GAAP)$3.095M N/A$16.003M
Adjusted EBITDA Margin (%)1% N/A3%

Values with asterisks were retrieved from S&P Global.

Estimates Comparison (Wall Street Consensus vs Actual)

MetricQ2 2025 ActualQ2 2025 ConsensusSurprise
Revenue ($USD)$528.149M $502.787M*+$25.36M / +5.0%
Primary EPS ($USD)$(7.29) $(4.9677)*−$2.32 (more negative)

Values with asterisks were retrieved from S&P Global.

Segment Revenue Breakdown (Q2 2025)

SegmentQ2 2025 Revenue ($USD)YoY Growth
Payments Revenue$366M +19%
Platform-Related Revenue$162M +113%

KPIs and Operating Metrics

KPIQ2 2025YoY
Active Members8.7M +23%
ARPAM (Avg Revenue per Active Member)$245 +12%
Purchase Volume$32.4B +18%
Avg Transactions per Active per Month55 N/A
App Engagement per Day (Avg)5 N/A
MyPay Loss Rate~140 bps (Q2) vs. >160 bps (Q1) Improving toward ~1% target

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
RevenueQ3 2025Not provided (company notes above prior internal expectations) $525M–$535M Raised vs prior internal
Adjusted EBITDAQ3 2025Not provided $12M–$17M Raised vs prior internal
Adjusted EBITDA MarginQ3 2025Not provided 2%–3% Raised vs prior internal
RevenueFY 2025Not provided $2.135B–$2.155B Raised vs prior internal
Adjusted EBITDAFY 2025Not provided $84M–$94M Raised vs prior internal
Adjusted EBITDA MarginFY 2025Not provided 4% Raised vs prior internal
Incremental Adjusted EBITDA MarginQ4 2025Not provided Mid-40%+ Raised vs prior internal

Earnings Call Themes & Trends

TopicPrevious Mentions (Q-2 and Q-1)Current Period (Q2 2025)Trend
AI/Technology InitiativesQ1 seasonality referenced; ongoing investment in AI and tech stack modernization implied by management’s model framing GenAI voice bot launched; doubled satisfaction vs legacy; AI handles work of thousands of agents; continued ChimeCore migration Expanding adoption and measurable CX impact
ChimeCore MigrationEarlier progress referenced as strategic priority (transition underway) All new debit/savings migrated; full transition expected over coming quarters On track; accelerates product velocity/cost
MyPay EconomicsInitial rollout in Q3 2024; Q1 loss rates >160 bps Q2 ~140 bps; transaction margin tripled QoQ; 1% steady-state targeted Rapid improvement; ahead of plan
CAC & LTVCAC down >10% YoY in Q2; paybacks 5–6 quarters vs 7 in S-1 Continued referral-driven efficiency; LTV/CAC ~8x Strengthening unit economics
Macro/Spend MixStable non-discretionary spend; inflation moderating vs 2022 highs Primary/tenured users steady; per-active spend reflects mix of newer ungated users Stable cohorts; mix impacts per-active spend
Regulatory/Banks Data Access FeesCFPB stance suggests pricing unlikely; negligible impact on Chime given primary account data ownership No strategy change; day-one MyPay experiment continues Low risk exposure

Management Commentary

  • Strategic positioning: “We created Chime to help everyday people… to become the largest provider of primary account relationships in The US” — CEO Chris Britt .
  • Cost-to-serve and AI leverage: “AI powered tools now fully automate the majority of our support interactions and do the work of thousands of human agents” — CEO Chris Britt .
  • Product momentum: “MyPay… an over $300,000,000 annual revenue run rate product… transaction margins tripling in the quarter” — CEO Chris Britt .
  • Model/Unit economics: “Estimated LTV to CAC of roughly 8x… high transaction margin and largely fixed OpEx base drive strong operating leverage” — CFO Matt Newcomb .

Q&A Highlights

  • Funnel widening/day-one strategy: Opening Apple Pay, mobile check deposit, and introductory access to certain features pre–direct deposit is increasing activation and funding rates; mix shift lowers per-active spend near-term but boosts conversion and retention over time .
  • MyPay trajectory: Attach rates up QoQ; faster-than-planned loss rate improvement to ~140 bps in Q2, aiming toward ~1% in the medium term; margin gains drive H2 adjusted EBITDA acceleration .
  • Workplace/Enterprise channel: Offering broader financial wellness (100% earned wage access with no fees for immediate or delayed receipt) differentiates vs competitors and enhances adoption; pipeline strong, announcements forthcoming .
  • Interchange and shares: Interchange rates broadly stable; credit card carries higher rates vs debit; issued shares ~370M per filings for EV modeling .
  • Margin path: Long-term adjusted EBITDA margin target ~35%; mid-40%+ incremental margins expected by Q4, aided by AI efficiency and maturing MyPay cohorts .

Estimates Context

  • Revenue beat: Actual $528.1M vs consensus $502.8M (+5.0%), driven by payments revenue scale and platform strength (MyPay) .
  • EPS miss (GAAP): Reported -$7.29 vs consensus -$4.97 due to IPO-related SBC and payroll taxes (~$928M), masking underlying adjusted profitability expansion .
  • Consensus inputs: EPS estimates count = 5; revenue estimates count = 12*.
    Values with asterisks were retrieved from S&P Global.

Key Takeaways for Investors

  • Revenue momentum and non-GAAP profitability are advancing; Q3 and FY 2025 guides were raised vs prior internal expectations, with incremental adjusted EBITDA margins returning to mid-40%+ by Q4 .
  • Bold positive: MyPay economics are improving faster than planned (loss rates ~140 bps, margin tripled QoQ), setting up H2 operating leverage as cohorts mature .
  • GAAP EPS optics were negatively impacted by one-time IPO-related SBC and payroll taxes (~$928M); underlying operational performance remains solid (adj. EBITDA 3% margin) .
  • Payments scale and engagement (non-discretionary spend) anchor resilience; purchase volume $32.4B and Active Members +23% YoY to 8.7M support durable cohorts .
  • AI and ChimeCore migration are tangible efficiency drivers; near-term focus remains cost-to-serve reductions and product velocity to sustain margin trajectory .
  • H2 watch items: RPM normalization as Chime laps MyPay launch, continued Instant Loans rollout, Workplace enterprise partnerships, and execution on AI-led support scaling .
  • Trading lens: Expect reactions to revenue beat and margin expansion guidance, while the market should look through GAAP EPS noise; narrative hinges on sustained MyPay loss-rate progress and confirmation of mid-40%+ incremental margins by Q4 .

Notes on sources and availability:

  • 8-K press release and accompanying financials were read in full; Item 2.02 confirms earnings release; EX-99.1 contains Q2 2025 results and guidance .
  • Full Q2 2025 earnings call transcript was read; prepared remarks and Q&A used extensively –.
  • No separate Q2 2025 press releases beyond EX-99.1 were found in the specified window. Prior quarter public earnings materials were not available in the document index; trend analysis leverages call references and S&P Global data where noted. Values with asterisks were retrieved from S&P Global.