Sign in
DI

Dave Inc./DE (DAVE)·Q4 2024 Earnings Summary

Executive Summary

  • Record Q4 revenue of $100.9M (+38% y/y), GAAP net income of $16.8M, and adjusted EBITDA of $33.4M (+234% y/y); non-GAAP variable margin reached 72% (all-time high) .
  • Fee model transition completed in mid-Q1’25 to a simplified 5% fee (min $5, cap $15) with no instant transfer fee to Dave Checking; management expects higher limits, monetization, and LTV; Q4 ExtraCash originations +44% y/y to $1.5B, 28-day delinquency improved 53 bps to 1.66% .
  • 2025 guidance: GAAP revenue $415–$435M and adjusted EBITDA $110–$120M; strategic sponsor bank partnership finalized with Coastal Community Bank to support ExtraCash and banking products starting Q2’25 .
  • Post-quarter, Board authorized a $50M share repurchase, signaling confidence and adding a capital return catalyst .
  • S&P Global consensus estimates were unavailable via our feed for Q4’24 (we attempted retrieval); management highlighted “significantly exceeding” the high end of their own guidance on adjusted EBITDA .

What Went Well and What Went Wrong

What Went Well

  • Record top-line and profitability: “we surpassed both $100 million in quarterly revenue as well as more than $30 million of quarterly adjusted EBITDA for the first time,” driven by MTM growth, ARPU expansion and operating leverage .
  • Credit performance and unit economics: CashAI drove better risk separation; Q4 provision as % of originations at 1.12% (vs 1.41% prior-year), variable margin reached 72% (excl. one-time rebate: 71%) .
  • Product and platform momentum: MTMs +17% to 2.5M; debit spend +24% to $457M; fee model testing showed favorable conversion, retention, monetization, supporting higher limits and LTV .

What Went Wrong

  • Operating expense pressure pockets: Q4 compensation up y/y largely due to stock-based comp (performance RSUs); other opex higher due to intangible amortization and FTC/DOJ legal fees .
  • Sequential uptick in provision % (Q3→Q4) tied to quarter-end calendar day (Q4 ended on a Tuesday, peak receivables day), lifting allowance and provision vs Q3 (1.12% vs 1.01%) despite better delinquency .
  • Regulatory overhang: DOJ filed an amended complaint (Dec 30, 2024) focused on disclosures/consent; Dave filed motion to dismiss (Feb 28, 2025), but legal outcomes remain uncertain .

Financial Results

Headline metrics by quarter

MetricQ4 2023Q2 2024Q3 2024Q4 2024
GAAP Operating Revenues, Net ($M)$73.2 $80.1 $92.5 $100.9
YoY Revenue Growth23% 31% 41% 38%
GAAP Net Income ($M)$0.2 $6.4 $0.5 $16.8
GAAP Diluted EPS ($)$0.01 $0.47 $0.03 $1.16
Adjusted EBITDA ($M)$10.0 $15.2 $24.7 $33.4
Non-GAAP Variable Profit Margin (%)63% 65% 69% 72%

Revenue mix

Revenue ($M)Q4 2023Q2 2024Q3 2024Q4 2024
Service-based revenue, net$65.4 $71.6 $83.4 $90.8
Transaction-based revenue, net$7.8 $8.5 $9.1 $10.1
Total operating revenues, net$73.2 $80.1 $92.5 $100.9

KPIs and credit

KPIQ2 2024Q3 2024Q4 2024
New Members (000s)716 854 766
CAC ($)15 15 16
Monthly Transacting Members (MM)2.3 2.4 2.5
ExtraCash Originations ($B)1.2 1.4 1.5
28-Day Delinquency Rate (%)2.03 1.78 1.66
Dave Debit Card Spend ($M)388 407 457
Provision as % of Originations (%)—1.01 1.12

Note: “Provision as % of Originations” is from management commentary rather than financial statement captions .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
GAAP Operating Revenues, Net ($M)FY 2025N/A$415 – $435 New
Adjusted EBITDA ($M)FY 2025N/A$110 – $120 New
CommentaryFY 2025—Expect typical Q1 seasonal softness (tax refunds), focus on ARPU, banking attach, retention; strong variable margins and scalability —

Earnings Call Themes & Trends

TopicPrevious Mentions (Q-2 and Q-1)Current Period (Q4 2024)Trend
CashAI/credit techQ2’24: strong loss rates powered by CashAI; Q3’24: 28-day delinquency 1.78%, loss provision 1.0% of originations, margin gains from CashAI Further improvement: 28-day delinquency 1.66%; provision 1.12% (calendar-day effect); credit performance expected strong in Q1 seasonally Improving underwriting and stable risk; marginal sequential mix effect
Fee structure/product monetizationQ3’24: testing simplified mandatory fee; remove tips/instant transfer; favorable tests Full migration completed Feb 19; 5% fee ($5 min, $15 cap); no instant transfer fee to Dave Card; expected higher limits/LTV Simplification completed; clearer monetization and investor clarity
Banking/sponsor bankQ3’24: LOI with top sponsor bank to support next-gen credit/banking Definitive partnership with Coastal Community Bank; onboarding new customers from Q2’25; eventual migration of base Relationship finalized and implementation timeline set
Marketing/CAC & ARPUQ3’24: CAC $15 (-14% y/y), ARPU +14% y/y; efficient marketing CAC $16 with higher spend given stronger LTV; ARPU +18% y/y; plan moderate marketing increases with disciplined ROIs Sustained LTV/CAC strength; scaling with discipline
Regulatory/legalQ3’24: FTC suit focused on disclosures/consent; $7M legal accrual DOJ amended FTC complaint (12/30); motion to dismiss filed (2/28); does not challenge business model Ongoing, but business model intact; disclosure/consent focus
Debit card engagementQ2–Q3’24: debit spend +28% (Q2), +19% (Q3); 30% EC volume to card cited Debit spend +24% to $457M; continued focus on loyalty/rewards, attach rate; no fee to send ExtraCash to card Growing engagement; more R&D in 2025

Management Commentary

  • “We surpassed both $100 million in quarterly revenue as well as more than $30 million of quarterly adjusted EBITDA for the first time” .
  • On pricing shift: “Fixed monetization … $5 or 5% (min $5, $15 cap) … better monetization, higher ARPU, higher limits, better retention” .
  • On credit: “Provision … fell to 1.12% of originations … underscores CashAI’s enhanced ability to better predict credit risk” .
  • On Coastal: “Finalized our new strategic partnership with Coastal Community Bank … sponsor our ExtraCash and banking products … onboard new customers starting in Q2” .
  • Guidance/tone: “We expect GAAP revenue $415–$435 million … adjusted EBITDA $110–$120 million” and “another year of record performance in 2025” .

Q&A Highlights

  • Monetization/fixed fee model: Fixed fees align revenue with risk as customers season; removes tips/instant transfer variability; early results positive for ARPU/LTV .
  • Marketing ROI: Diversified channels; can sustain increased CAC with higher LTV from fee model and UX improvements; plan moderate spend increases .
  • Credit outlook: Provision should rise in dollars with scale but remain efficient; multiple underwriting initiatives in flight; seasonal improvement in Q1 with tax refunds .
  • Coastal partnership: Comparable economics to prior sponsor; enables next-gen credit products; new customers onboarded to Coastal from Q2; eventual full migration .
  • Capital allocation: Used ~$14.5M to net settle RSU taxes (reduce dilution ~132k shares); open to more buybacks; subsequently authorized $50M repurchase program post-quarter .

Estimates Context

  • We attempted to retrieve S&P Global consensus for Q4’24 (Primary EPS Consensus Mean, Revenue Consensus Mean, and # of estimates), but data were unavailable via our feed for DAVE. As a result, beat/miss vs Street is not determined here. We note management stated Q4 adjusted EBITDA “significantly exceeding” the high end of guidance .
  • Where estimates would guide near-term revisions, we expect Street models to reflect: (1) durable monetization from the 5% fixed fee, (2) higher ARPU and ExtraCash limits, (3) sponsor bank transition timing, and (4) variable margin sustainability with CashAI.

Key Takeaways for Investors

  • Structural monetization upgrade: Full fee model migration (5% fee, $5 min/$15 cap, no instant transfer fee to Dave Card) should support higher limits, ARPU, and LTV while simplifying revenue predictability .
  • Credit engine advantage: CashAI continues to tighten loss rates and lift variable margins; Q4 28-day delinquency at 1.66% and provision at 1.12% of originations despite calendar effects .
  • Profitable growth at scale: Q4 revenue $100.9M, adj. EBITDA $33.4M, non-GAAP variable margin 72%; operating leverage evident as fixed costs grow slower than revenue .
  • 2025 setup favorable: Guidance implies 20–25% revenue growth and 27–39% adj. EBITDA growth; moderate marketing increases tied to LTV/CAC discipline .
  • Banking partner finalized: Coastal Community Bank relationship de-risks sponsor model and enables new credit products; onboarding new customers in Q2’25 with plan to migrate existing base over time .
  • Capital returns emerging: $50M buyback authorization post-quarter complements internal investments and potential M&A; underscores management’s confidence in cash generation .
  • Regulatory overhang manageable: DOJ’s amended complaint focuses on disclosures/consent (not the business model); motion to dismiss filed; product changes align with disclosure/consent themes .

Appendix: Additional Data Points

  • Liquidity: ~$91.9M in cash, equivalents, marketable securities, investments, and restricted cash at 12/31/24 (vs $76.7M at 9/30/24); $75M drawn on $150M facility; ~$167M total liquidity including undrawn capacity .
  • Variable profit reconciliation and non-GAAP definitions are detailed in the press release and 8-K exhibit .