Chime Financial, Inc. Q3 FY2025 earnings call

• Q3 was a strong quarter with 29% YOY revenue growth and adjusted EBITDA margin up 9 points. - Launched the new Chime Card, which offers 1.5% cash back on everyday spend for direct depositors and a titanium card option. - Completed migration to ChimeCore, a proprietary transaction processing core, which sets the stage for faster product innovation and cost efficiency. - Early engagement programs in Chime Enterprise are driving strong member acquisition with attractive unit economics. - Announced a $200 million share repurchase authorization.

In Q3, Chime delivered 29% year-over-year revenue growth. Active members reached 9.1 million, a 21% year-over-year increase. Adjusted EBITDA margin improved by 9 points year-over-year. MyPay, an essential feature loved by members, has an over $350 million annual run rate with a transaction margin of over 45%. Revenue contribution from various segments is driven by active members, purchase volume, and product attach rates.

• Raised Q4 and full year 2025 guidance for revenue and adjusted EBITDA. Q4 revenue expected $572M-$582M (20%-23% YOY growth), adjusted EBITDA $43M-$48M (8% margin). Full year revenue $2.163B-$2.173B, adjusted EBITDA $113M-$118M. - Expect ChimeCore migration to boost gross margin to close to 90% in Q4. - Full IPO lockup ends on the second full trading day following the earnings announcement.

• Macro risks and consumer health concerns could impact member behavior. - Competitive landscape with other fintechs and banks vying for market share. - Dependence on primary account relationships and potential challenges in maintaining low credit risk.

Q: What's the competitive environment like for member growth?

A: Chris Britt noted Chime is the #1 destination for people switching direct deposits and leads in online banking unaided awareness. Matt Newcomb added early engagement initiatives are driving lower CAC and higher monetization.

Q: How does outbound instant transfers (OIT) impact purchase volume?

A: Matthew Newcomb explained OIT causes a mix shift from payments to platform revenue, but combined purchase volume and OIT volume shows strong growth. Payments in OIT platform revenue combined grew 20% YOY in Q3.

Q: What's the outlook for MyPay's transaction margin?

A: Mark Troughton said MyPay loss rates are improving, with a target of 1% loss rate. Matt Newcomb added MyPay transaction margin is over 45% and expected to continue improving.

Q: What's the status of Chime Enterprise?

A: Mark Troughton stated Chime Enterprise has early traction, with partnerships like Workday and UKG, and strong employee adoption of direct deposit. Sales cycles are long but pipeline looks good.

Q: Any seasonality to be mindful of in Q4?

A: Matthew Newcomb said Q4 seasonally has a bit higher spend around holidays but not as much as Q1 tax refund season.