Investing analyses

# DAVE — Earnings Review Q4 FY25 (Atlas)

> Date: 2026-04-06
> Quarter: Q4 FY25 (Dec-2025) | Call Date: 2026-03-02
> Market cap: ~$2.4B | EV: ~$2.4B | EV/TTM Rev: 4.4x | Revenue growth: 62.4% YoY
> Share price: ~$173 | Diluted shares: 14.4M

## Verdict

DAVE delivered an exceptional Q4 that capped the strongest year in the company's history — $554M revenue (+60%), $227M EBITDA (41% margin), four consecutive guidance raises, and a 30% full-year beat versus initial guidance. The stock trades at 4.4x TTM revenue and ~12x run-rate adjusted earnings while growing 60%+, making it one of the cheapest high-growth names I have seen. FY26 guidance of $700M midpoint (+26%) looks intentionally conservative given the beat-and-raise pattern. The DOJ/FTC lawsuit is the primary risk, but the fee restructuring that resolved the alleged conduct is already live and driving record monetization. Conviction: 4.

## Qualification Gate

| Criterion | Threshold | DAVE | Status |
|-----------|-----------|------|--------|
| Revenue YoY growth | >30% (>40% preferred) | 62.4% | PASS |
| Gross margin | >60% (>70% preferred) | 74% Non-GAAP | PASS |
| Revenue per quarter | >$50M | $163.7M | PASS |
| Data availability | 4+ quarters | 16 quarters | PASS |
| Share dilution | <10% annual | -1.4% (declining) | PASS |
| GAAP profitability | Improving or positive | $66.0M net income Q4 | PASS |

All six criteria passed. Notably, shares are *shrinking*, not diluting — the $300M buyback authorization (expanded from $125M) plus the $200M convertible notes used partly for buybacks signal aggressive capital return.

## Six-Factor Score

| Factor | Rating | Detail |
|--------|--------|--------|
| Growth | Strong | 62.4% YoY Q4; three consecutive 60%+ quarters. FY25 revenue +60% to $554M. |
| Trajectory | Flat (elevated) | YoY: 25% -> 31% -> 41% -> 38% -> 47% -> 65% -> 63% -> 62%. Accelerated through FY24 into FY25, now sustaining 60%+ for three quarters. Not decelerating yet at current level. |
| Margins | Hig

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# DAVE — Q4 FY25 Earnings Review

**Date:** 2026-04-01 | **Quarter:** Q4 FY25 (Dec-2025) | **Reported:** 2026-03-02
**Prior WSM Thesis:** None — First analysis (initiating coverage)
**Verdict: Strong Buy. The cheapest 60% grower with 45% EBITDA margins in the growth universe. Every green flag in my framework is lit. The $175M zero-coupon convert + aggressive buyback is the cherry on top.**

---

## Prior Beliefs

- No prior thesis on DAVE — first analysis
- Sceptical of neobank/fintech names from 2021-2022 vintage (UPST destroyed me)
- Expected DAVE to be a low-quality EWA lender with credit risk
- Assumed small TAM and consumer lending headwinds

## Updated Beliefs

- **DAVE is NOT a typical neobank.** The CashAI underwriting engine is a genuine compounding moat. 8-10 day book turnover means faster model iteration than any credit card or instalment lender
- **Unit economics are self-reinforcing.** Every incremental member adds training data, improving CashAI, lowering losses, expanding origination sizes, and compressing GP payback. This is the flywheel I look for
- **Management has earned trust through relentless execution.** 4 consecutive FY25 guide raises, 30% revenue beat vs initial guide, CFO explicitly stating conservative guidance philosophy
- **Valuation is absurdly cheap.** 14x adj P/E on 60% growth with expanding margins. PEG of 0.55. This is mispriced
- **$175M zero-coupon convert (March 2026) is an incremental positive.** Free money, used for buybacks at current price, capped call limits dilution to above $421. Management is putting capital behind their conviction

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## The Numbers

### Revenue Trajectory — QoQ Grid (Years Across, Quarters Down)

| | FY22 QoQ | FY23 QoQ | FY24 QoQ | FY25 QoQ | Trend |
|---|---|---|---|---|---|
| **Q1** | 3.4% | -1.3% | 0.7% | **7.1%** | Accelerating (seasonally weakest Q) |
| **Q2** | 7.5% | 3.9% | 8.8% | **22.0%** | Accelerating (fee structure tailwind) |
| **Q3** | 24.0% | 7.5% | 15.5% | **14.3%** | Stable (normalis

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# DAVE — Q4 FY25 Earnings Review

> Analyst: Bear (PaulWBryant / Drew)
> Date: 2026-04-06
> Quarter: Q4 FY25 (Dec-2025)
> Call Date: March 2, 2026

---

## Prior Beliefs

I haven't written about Dave specifically, but applying my framework to what I know heading into Q4:

1. **Revenue:** Expected ~$160M for Q4, given the Q3 run-rate of $150.7M and management's tightened FY guide of $544-547M (implying $160-165M Q4). Revenue growth should be in the low-to-mid 60s% YoY based on the trajectory.
2. **EBITDA:** Expected 40-42% margins, continuing the progression from 39% in Q3. Absolute EBITDA of $65-70M.
3. **Credit quality:** Expected DPD to remain around 2.0-2.3%, consistent with guidance of sub-2.1%.
4. **MTMs:** Expected ~2.8-2.9M, continuing mid-to-high-teens growth.
5. **FY26 guidance:** Expected material deceleration — the growth algorithm of mid-teens MTM + low double-digit ARPU implies ~30% organic growth baseline.

---

## Updated Beliefs — Q4 FY25 Results vs. Expectations

| Metric | Prior Belief | Actual | Verdict |
|--------|-------------|--------|---------|
| Revenue | ~$160M | $163.7M (+62.4% YoY) | Beat — in line with high end |
| Adj EBITDA | $65-70M / 40-42% margin | $72.9M / 44.5% | Beat — margin expansion surprised |
| DPD (28-day) | ~2.0-2.3% | 1.89% | Better — improved 26bps QoQ |
| MTMs | 2.8-2.9M | 2.93M (+19% YoY) | In line — accelerating trend held |
| Originations | ~$2.0B | $2.2B (+50% YoY) | Beat — $200M sequential add |
| FY26 Guide | ~$650-700M / ~30% growth | $690-710M (+25-28%) | In line — 26% midpoint growth |
| FY26 EBITDA Guide | — | $290-305M (~42.5% margin) | Solid — margin expansion continues |
| FY26 EPS Guide | — | $14.00-$15.00 | Strong — ~$14.50 at ~14.4M shares |

**Overall:** The quarter exceeded expectations on almost every metric. The margin expansion to 44.5% EBITDA was the biggest surprise — I would not have expected 550bps of sequential improvement in a single quarter.

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## Financial Table — FY25 Quarterly Progressio

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# DAVE — Q4 FY25 Earnings Review

**Date:** 2026-04-06 | **Quarter:** Q4 FY25 (Dec-2025) | **Reported:** 2026-03-02
**Prior Saul Thesis:** None — First look
**Verdict: This is a blowout quarter from a company I'd never looked at before, and I have to tell you — the numbers are just spectacular. 62% revenue growth, 44.5% EBITDA margins, SBC declining, share count declining, and they beat their initial full-year guidance by 30%!!! That's just an amazing result.**

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## The Numbers — Let's Just Look at the Revenue

This is what matters. Let me put the table up:

| | Q1_FY24 | Q2_FY24 | Q3_FY24 | Q4_FY24 | Q1_FY25 | Q2_FY25 | Q3_FY25 | Q4_FY25 |
|---|---|---|---|---|---|---|---|---|
| Revenue ($m) | 73.6 | 80.1 | 92.5 | 100.8 | 108.0 | 131.8 | 150.7 | **163.7** |
| YoY % | 25% | 31% | 41% | 38% | **47%** | **64%** | **63%** | **62%** |
| QoQ % | 0.7% | 8.8% | 15.5% | 9.0% | 7.1% | 22.0% | 14.3% | 8.6% |
| Non-GAAP GM % | 67.8% | 65.0% | 69.0% | 72.0% | 77.0% | 70.0% | 69.0% | **74.0%** |
| GAAP Op Margin | 7.3% | 7.1% | 2.8% | 20.8% | 32.6% | 31.1% | 30.5% | **39.4%** |
| Adj EBITDA ($m) | 13.2 | 15.2 | 24.7 | 33.4 | 44.2 | 50.9 | 58.7 | **72.9** |
| EBITDA Margin % | 17.9% | 19.0% | 26.7% | 33.1% | 40.9% | 38.6% | 39.0% | **44.5%** |
| MTMs (M) | — | — | 2.40 | 2.50 | 2.50 | 2.60 | 2.77 | **2.93** |
| Originations ($B) | — | — | 1.40 | 1.50 | 1.50 | 1.80 | 2.00 | **2.20** |
| 28-day DPD % | — | — | 1.78% | 1.66% | 1.50% | 2.40% | 2.33% | **1.89%** |
| SBC ($m) | 6.1 | 7.7 | 13.4 | 10.1 | 7.5 | 8.3 | 7.2 | **6.9** |
| Diluted Shares (M) | 13.2 | 13.5 | 13.9 | 14.6 | 14.6 | 14.6 | 14.5 | **14.4** |

Now look at that table and tell me this company isn't executing at an extraordinary level! Revenue went from 25% YoY growth two years ago to three consecutive quarters of 62-64%!!! That's not just fast growth — that's **accelerating** growth at scale. Revenue more than doubled in two years, from $73.6m to $163.7m in the December quarter.

And the full year? $554.2 million 

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