Dave Inc. (Nasdaq: DAVE, DAVEW) (“Dave” or the “Company”), one of
the leading U.S. neobanks on a mission to build products that level
the financial playing field, today reported its financial results
for the third quarter ended September 30, 2022.
“We experienced impressive results in the third quarter on all
fronts, with record revenue, transacting members and new member
growth, along with strong performance of our Dave Card business
following the rollout of our new, integrated product experience.
Our unit economics are also improving, with sequential variable
margin improvement supported by consistent ExtraCash credit
performance. Importantly, our run-rate cash burn at the end of the
third quarter and into the fourth quarter is showing significant
progress relative to recent quarters,” said Jason Wilk, Founder and
Chief Executive Officer of Dave. “Our results to date and positive
outlook show our continued progress towards reaching Adjusted
EBITDA profitability in 2024, while operating a resilient,
well-capitalized business.”
Third Quarter 2022 Operating Highlights:
- Added 808,000 Net New Members, up 43% sequentially when
compared to the second quarter ended June 30, 2022 while reducing
CAC by 18%. Total members reached 7.8 million at September 30,
2022
- 1.8 million Monthly Transacting Members, up 18% sequentially
when compared to the second quarter ended June 30, 2022.
Transactions Per Monthly Transacting Member reached a record of
4.6.
- $757 million in ExtraCash originations, up 25% sequentially
when compared to 2Q22
- Dave Debit Card spend of $197 million, up 15% sequentially when
compared to 2Q22, following release of a new product experience to
all members throughout the quarter.
Third Quarter 2022 Financial Highlights:
($ in millions except otherwise noted) |
3Q21 |
4Q21 |
1Q22 |
2Q22 |
3Q22 |
GAAP Operating Revenues, Net% Change vs. prior
year period |
$40.226% |
$41.216% |
$42.624% |
$45.8 23% |
$56.8 41% |
Non-GAAP Operating Revenues*% Change vs. prior
year period |
$41.526% |
$42.216% |
$43.723% |
$47.022% |
$58.641% |
Non-GAAP variable profit margin* |
48% |
48% |
41% |
39% |
42% |
GAAP Net loss |
($7.9) |
($15.2) |
($34.8) |
($27.1) |
($47.5) |
Adjusted EBITDA* |
($11.3) |
($12.6) |
($18.3) |
($28.5) |
($27.5) |
*See reconciliation of the non-GAAP measures at the end of the
press release.
Liquidity Summary:
$225 million of cash and cash equivalents, restricted cash, and
short-term investments as of September 30, 2022; the Company
additionally had $18 million of unused capacity on its existing
credit facilities as of September 30, 2022.
Fiscal Year 2022 Outlook:
“We are reiterating our guidance based on our 3Q22 performance
and the continued positive trends that we’re seeing in the
business,” said Kyle Beilman, Chief Financial Officer of Dave. “In
addition, building on the progress we made on burn late Q3, we’re
expecting a step function reduction in adjusted EBITDA losses in Q4
where we plan to deliver solid growth, continue to realize the
benefits of our margin-enhancing initiatives and moderate marketing
investment.” The Company is reiterating its guidance for fiscal
year 2022:
- Non-GAAP operating revenues between $200 million and $215
million
- Non-GAAP variable profit margin between 40% and 44%
Conference CallDave will host a conference call
and webcast to discuss third quarter 2022 financial results and
business operations updates today, Thursday, November 10, 2022,
at 5:30 pm ET. Hosting the call will be Jason Wilk,
Co-Founder and Chief Executive Officer, and Kyle Beilman,
Chief Financial Officer. The conference call will be webcast live
from the Company’s investor relations website
at https://investors.dave.com/. A replay and transcript will
be available on the investor relations website following the
call.
About DaveDave is on a mission to build
products that level the financial playing field. Dave’s financial
tools, including its debit card and spending account, help millions
of customers bank, budget, avoid overdraft fees and find work. For
more information, visit www.dave.com.
Forward-Looking StatementsThis press release
includes forward-looking statements, which are subject to the “safe
harbor” provisions of the U.S. Private Securities Litigation Reform
Act of 1995. These statements may be identified by words such as
“feel,” “believes,” expects,” “estimates,” “projects,” “intends,”
“should,” “is to be,” or the negative of such terms, or other
comparable terminology and include, among other things, the
quotations of our Chief Executive Officer and Chief Financial
Officer relating to Dave’s future performance, fiscal 2022
guidance, expected timing of meeting adjusted EBITDA profitability
and other statements about future events. Such forward-looking
statements are not guarantees of future performance and are subject
to risks and uncertainties, which could cause actual results to
differ materially from the forward-looking statements contained
herein due to many factors, including, but not limited to: the
ability of Dave to compete in its highly competitive industry; the
ability of Dave to keep pace with the rapid technological
developments in its industry and the larger financial services
industry; the ability of Dave to manage its growth as a public
company; disruptions to Dave’s operations as a result of becoming a
public company; the ability of Dave to remediate material
weaknesses in Dave’s internal controls over financial reporting and
maintain an effective system of internal control over financial
reporting; the ability of Dave to protect intellectual property and
trade secrets; changes in applicable laws or regulations and
extensive and evolving government regulations that impact
operations and business; the ability to attract or maintain a
qualified workforce; level of product service failures that could
lead Dave members to use competitors’ services; investigations,
claims, disputes, enforcement actions, litigation and/or other
regulatory or legal proceedings; the effects of the COVID-19
pandemic on Dave’s business; the possibility that Dave may be
adversely affected by other economic, business, and/or competitive
factors; and those factors discussed in Dave’s Annual Report on
Form 10-K filed with the Securities and Exchange Commission (the
“SEC”) on March 25, 2022 and subsequent Quarterly Reports on Form
10-Q under the heading “Risk Factors,” filed with the SEC and other
reports and documents Dave files from time to time with the SEC.
Any forward-looking statements speak only as of the date on which
they are made, and Dave undertakes no obligation to update any
forward-looking statement to reflect events or circumstances after
the date of this press release.
Non-GAAP Financial InformationThis press
release contains references to Adjusted EBITDA, non-GAAP operating
revenues, non-GAAP operating expenses, non-GAAP variable profit and
non-GAAP variable profit margin of Dave, which are adjusted from
results based on generally accepted accounting principles in the
United States (“GAAP”) and exclude certain expenses, gains and
losses. The Company defines and calculates Adjusted EBITDA as net
loss attributable to Dave before the impact of interest income or
expense, provision for income taxes, depreciation and amortization,
and adjusted to exclude legal settlement and litigation expenses,
other strategic financing and transaction expenses, stock-based
compensation expense, and certain other non-core items. The Company
defines and calculates non-GAAP operating revenues as operating
revenues, net excluding direct loan origination costs and ATM fees.
The Company defines and calculates non-GAAP operating expenses as
operating expenses excluding non-variable operating expenses. The
Company defines non-variable operating expenses as all advertising
and marketing operating expenses, compensation and benefits
operating expenses, and certain operating expenses (legal, rent,
technology/infrastructure, depreciation, amortization, charitable
contributions, other operating expenses, upfront Member account
activation costs and upfront Dave Banking expenses). The Company
defines and calculates non-GAAP variable profit as non-GAAP
operating revenues excluding non-GAAP operating expenses. The
Company defines and calculates non-GAAP variable profit margin as
non-GAAP variable profit as a percent of non-GAAP operating
revenues.
These non-GAAP financial measures are provided to enhance the
user’s understanding of our prospects for the future and the
historical performance for the context of the investor. The
Company’s management team uses these non-GAAP financial measures in
assessing performance, as well as in planning and forecasting
future periods. These non-GAAP financial measures are not computed
according to GAAP and the methods the Company uses to compute them
may differ from the methods used by other companies. Non-GAAP
financial measures are supplemental, should not be considered a
substitute for financial information presented in accordance with
GAAP and should be read only in conjunction with our consolidated
financial statements prepared in accordance with GAAP.
Refer to the section further below for a reconciliation of these
non-GAAP financial measures to their most directly comparable GAAP
measures for the three and nine months ended September 30, 2022 and
2021.
Dave defines Net New Members as the number of new Members who
join the Dave platform in a given period by connecting an existing
bank account to the Dave service or by opening a new Dave Banking
account, net of the number of accounts deleted by Members or closed
by the Company in the same period. Total Members is defined as the
number of unique Members that have either connected an existing
bank account to the Dave service or have opened a Dave Banking
account, less the number of accounts deleted by Members or closed
by Dave, as measured at the end of a period. The number of Monthly
Transacting Members represents the unique number of Members who
have made a funding, spending, ExtraCash or subscription
transaction within a particular month, measured as the average over
a given period. Transactions Per Monthly Transacting Member
measures the average number of transactions initiated per Monthly
Transacting Member in each month, measured as the average over a
given period.
DaveMediapress@dave.com
InvestorsDaveIR@icrinc.com
DAVE INC.
AND SUBSIDIARIES |
|
CONSOLIDATED
STATEMENTS OF OPERATIONS |
|
(in millions) |
|
(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended September 30, |
|
For the Nine Months Ended September 30, |
|
|
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
|
|
|
|
|
|
|
|
|
|
|
Operating revenues: |
|
|
|
|
|
|
|
|
|
Service based revenue, net |
|
$ |
52.8 |
|
|
$ |
37.3 |
|
|
$ |
135.1 |
|
|
$ |
104.1 |
|
|
Transaction based revenue, net |
|
|
4.0 |
|
|
|
2.9 |
|
|
|
10.1 |
|
|
|
7.8 |
|
|
Total operating revenues, net |
|
|
56.8 |
|
|
|
40.2 |
|
|
|
145.2 |
|
|
|
111.9 |
|
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
Provision for unrecoverable advances |
|
|
18.4 |
|
|
|
10.8 |
|
|
|
46.0 |
|
|
|
21.7 |
|
|
Processing and servicing fees |
|
|
9.5 |
|
|
|
6.2 |
|
|
|
23.6 |
|
|
|
16.9 |
|
|
Advertising and marketing |
|
|
24.1 |
|
|
|
12.9 |
|
|
|
57.1 |
|
|
|
38.8 |
|
|
Compensation and benefits |
|
|
24.3 |
|
|
|
15.4 |
|
|
|
81.3 |
|
|
|
34.7 |
|
|
Other operating expenses |
|
|
18.4 |
|
|
|
10.6 |
|
|
|
50.8 |
|
|
|
32.0 |
|
|
Total operating expenses |
|
|
94.7 |
|
|
|
55.9 |
|
|
|
258.8 |
|
|
|
144.1 |
|
|
Other (income) expenses: |
|
|
|
|
|
|
|
|
|
Interest income |
|
|
(1.2 |
) |
|
|
(0.5 |
) |
|
|
(1.8 |
) |
|
|
(0.6 |
) |
|
Interest expense |
|
|
2.5 |
|
|
|
0.8 |
|
|
|
6.2 |
|
|
|
1.4 |
|
|
Legal settlement and litigation expenses |
|
|
6.8 |
|
|
|
0.3 |
|
|
|
6.8 |
|
|
|
1.0 |
|
|
Other strategic financing and transactional expenses |
|
|
2.2 |
|
|
|
— |
|
|
|
5.0 |
|
|
|
0.3 |
|
|
Gain on extinguishment of liability |
|
|
— |
|
|
|
— |
|
|
|
(4.3 |
) |
|
|
— |
|
|
Changes in fair value of earnout liabilities |
|
|
— |
|
|
|
— |
|
|
|
(9.6 |
) |
|
|
— |
|
|
Changes in fair value of derivative asset on loans to
stockholders |
|
|
— |
|
|
|
(9.0 |
) |
|
|
5.6 |
|
|
|
(33.0 |
) |
|
Changes in fair value of warrant liabilities |
|
|
(0.7 |
) |
|
|
0.6 |
|
|
|
(14.2 |
) |
|
|
3.5 |
|
|
Total other expenses (income), net |
|
|
9.6 |
|
|
|
(7.8 |
) |
|
|
(6.3 |
) |
|
|
(27.4 |
) |
|
Net
loss before provision (benefit) for income taxes |
|
|
(47.5 |
) |
|
|
(7.9 |
) |
|
|
(107.3 |
) |
|
|
(4.8 |
) |
|
Provision (benefit) for income taxes |
|
|
— |
|
|
|
— |
|
|
|
0.1 |
|
|
|
— |
|
|
Net
loss |
|
$ |
(47.5 |
) |
|
$ |
(7.9 |
) |
|
$ |
(107.4 |
) |
|
$ |
(4.8 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DAVE INC.
AND SUBSIDIARIES |
|
RECONCILIATION OF OPERATING REVENUES, NET TO NON-GAAP
OPERATING REVENUES |
|
(in millions) |
|
(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended September 30, |
|
For the Nine Months Ended September 30, |
|
|
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
|
|
|
|
|
|
|
|
|
|
|
Operating revenues, net |
|
$ |
56.8 |
|
|
$ |
40.2 |
|
|
$ |
145.2 |
|
|
$ |
111.9 |
|
|
ExtraCash origination and ATM-related fees |
|
|
1.8 |
|
|
|
1.3 |
|
|
|
4.1 |
|
|
|
3.5 |
|
|
Non-GAAP operating revenues |
|
$ |
58.6 |
|
|
$ |
41.5 |
|
|
$ |
149.3 |
|
|
$ |
115.4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RECONCILIATION OF OPERATING EXPENSES TO NON-GAAP OPERATING
EXPENSES |
|
(in millions) |
|
(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended September 30, |
|
For the Nine Months Ended September 30, |
|
|
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses |
|
$ |
94.7 |
|
|
$ |
55.9 |
|
|
$ |
258.8 |
|
|
$ |
144.1 |
|
|
Non-variable operating expenses |
|
|
(60.8 |
) |
|
|
(34.2 |
) |
|
|
(170.4 |
) |
|
|
(92.6 |
) |
|
Non-GAAP operating expenses |
|
$ |
33.9 |
|
|
$ |
21.7 |
|
|
$ |
88.4 |
|
|
$ |
51.5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CALCULATION
OF NON-GAAP VARIABLE PROFIT |
|
(in millions) |
|
(unaudited) |
|
|
|
|
|
|
|
|
|
For the Three Months Ended September 30, |
|
For the Nine Months Ended September 30, |
|
|
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP operating revenues |
|
$ |
58.6 |
|
|
$ |
41.5 |
|
|
$ |
149.3 |
|
|
$ |
115.4 |
|
|
Non-GAAP variable operating expenses |
|
|
(33.9 |
) |
|
|
(21.7 |
) |
|
|
(88.4 |
) |
|
|
(51.5 |
) |
|
Non-GAAP variable profit |
|
$ |
24.7 |
|
|
$ |
19.8 |
|
|
$ |
60.9 |
|
|
$ |
63.9 |
|
|
Non-GAAP variable profit margin |
|
|
42 |
% |
|
|
48 |
% |
|
|
41 |
% |
|
|
55 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DAVE INC.
AND SUBSIDIARIES |
|
RECONCILIATION OF NET LOSS TO ADJUSTED EBITDA |
|
(in millions) |
|
(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended September 30, |
|
For the Nine Months Ended September 30, |
|
|
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
|
|
|
|
|
|
|
|
|
|
|
Net
loss |
|
$ |
(47.5 |
) |
|
$ |
(7.9 |
) |
|
$ |
(107.4 |
) |
|
$ |
(4.8 |
) |
|
Interest expense, net |
|
|
1.3 |
|
|
|
0.3 |
|
|
|
4.4 |
|
|
|
0.8 |
|
|
Provision (benefit) for income taxes |
|
|
— |
|
|
|
— |
|
|
|
0.1 |
|
|
|
— |
|
|
Depreciation and amortization |
|
|
2.4 |
|
|
|
0.8 |
|
|
|
5.1 |
|
|
|
2.0 |
|
|
Stock-based compensation |
|
|
8.0 |
|
|
|
3.6 |
|
|
|
34.1 |
|
|
|
6.3 |
|
|
Legal settlement and litigation expenses |
|
|
6.8 |
|
|
|
0.3 |
|
|
|
6.8 |
|
|
|
1.0 |
|
|
Other strategic financing and transactional expenses |
|
|
2.2 |
|
|
|
— |
|
|
|
5.0 |
|
|
|
0.3 |
|
|
Gain on extinguishment of liability |
|
|
— |
|
|
|
— |
|
|
|
(4.3 |
) |
|
|
— |
|
|
Changes in fair value of earnout liabilities |
|
|
— |
|
|
|
— |
|
|
|
(9.6 |
) |
|
|
— |
|
|
Changes in fair value of derivative asset on loans to
stockholders |
|
|
— |
|
|
|
(9.0 |
) |
|
|
5.6 |
|
|
|
(33.0 |
) |
|
Changes in fair value of warrant liabilities |
|
|
(0.7 |
) |
|
|
0.6 |
|
|
|
(14.2 |
) |
|
|
3.5 |
|
|
Adjusted EBITDA |
|
$ |
(27.5 |
) |
|
$ |
(11.3 |
) |
|
$ |
(74.4 |
) |
|
$ |
(23.9 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DAVE INC.
AND SUBSIDIARIES |
|
|
|
|
|
LIQUIDITY
AND CAPITAL RESOURCES |
|
|
|
|
|
(in millions) |
|
|
|
|
|
(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September
30, |
|
December
31, |
|
|
|
|
|
|
|
|
2022 |
|
|
|
2021 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash, cash
equivalents and restricted cash |
|
$ |
39.3 |
|
|
$ |
32.4 |
|
|
|
|
|
|
Marketable
securities |
|
|
— |
|
|
|
8.2 |
|
|
|
|
|
|
Short-term
investments |
|
|
185.3 |
|
|
|
— |
|
|
|
|
|
|
Working
capital |
|
|
259.1 |
|
|
|
31.6 |
|
|
|
|
|
|
Total
stockholders’ equity |
|
|
123.2 |
|
|
|
38.7 |
|
|
|
|
|
|
Dave (NASDAQ:DAVEW)
Historical Stock Chart
From Jun 2024 to Jul 2024
Dave (NASDAQ:DAVEW)
Historical Stock Chart
From Jul 2023 to Jul 2024