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What changed in Dave Inc./DE's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Dave Inc./DE's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+754 added−640 removedSource: 10-K (2026-03-02) vs 10-K (2025-03-04)

Top changes in Dave Inc./DE's 2025 10-K

754 paragraphs added · 640 removed · 451 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

72 edited+42 added−53 removed46 unchanged
Biggest changeThis allows us to responsibly serve a broader audience, including Members deemed high-risk by legacy institutions, while maintaining strong unit economics. • Broad Application of Artificial Intelligence & Machine Learning: AI and machine learning are embedded across our platform and are designed to enhance multiple areas of our business: o Underwriting & Credit Decisioning: CashAI adapts and refines risk models based on real-time transaction data, enabling personalized credit limits and high approval rates while minimizing risk exposure. o Fraud Detection & Prevention: Our AI-powered fraud mitigation system detects and prevents fraudulent activity in real-time by analyzing behavioral patterns and transaction anomalies to create user-level controls. o Automated Member Support: Our AI chatbot, DaveGPT, enables efficient, self-service resolution for a broad range of customer inquiries, further reducing operational costs. o Income & Expense Prediction: Our technology predicts upcoming cash flows to power both CashAI and customer-facing budgeting features. • Data Advantage & Proprietary Machine Learning Infrastructure: Over the past five years, Dave has processed more than 118 million credit transactions, continuously refining our models and deepening our insights into consumer financial behavior.
Biggest changeBroad Application of AI and Machine Learning AI and machine learning are embedded across our platform: • Fraud Detection and Prevention: Our AI-powered fraud mitigation system analyzes behavioral patterns and transaction anomalies in real-time, creating user-level controls that detect and prevent fraudulent activity before losses occur. • Automated Member Support: DaveGPT, our AI-powered chatbot, enables efficient self-service resolution for a broad range of Member inquiries, improving response times while reducing operational costs. • Income and Expense Prediction: Our technology predicts upcoming cash flows to power both CashAI underwriting decisions and customer-facing budgeting features within the Dave app.
The nature and kind of this impact will also depend on and our, and our competitors’, ability to meet and comply with standards established by the CFPB’s designated standard-setting body. In October 2024, industry trade associations filed a lawsuit against the CFPB alleging the agency exceeded its statutory authority and asking the court to vacate the rule.
The nature and kind of this impact will also depend on our, and our competitors’, ability to meet and comply with standards established by the CFPB’s designated standard-setting body. In October 2024, industry trade associations filed a lawsuit against the CFPB alleging the agency exceeded its statutory authority and asking the court to vacate the rule.
See “ Risk Factors—Our business is subject to extensive regulation and oversight in a variety of areas under federal, state and local laws, and is subject to regulatory investigations and consumer litigation. ” In addition, we may become subject to additional legal or regulatory requirements we are not subject to today if laws or regulations change in the jurisdictions in which we operate, or if we were to release new products or services.
See “ Risk Factors—Our business is subject to extensive regulation 9 and oversight in a variety of areas under federal, state and local laws, and is subject to regulatory investigations and consumer litigation. ” In addition, we may become subject to additional legal or regulatory requirements we are not subject to today if laws or regulations change in the jurisdictions in which we operate, or if we were to release new products or services.
In December 2024, the CFPB finalized revisions to these rules eliminating an exemption to TILA and Regulation Z that had previously been available for bank overdrafts, which may affect our partner bank as the originator of our ExtraCash overdrafts and may result in operational and compliance challenges and new litigation risks and scrutiny by federal and state regulators.
In December 2024, the CFPB finalized revisions to these rules eliminating an exemption to TILA and Regulation Z that had previously been available for bank overdrafts, which may affect our partner banks as the originator of our ExtraCash overdrafts and may result in operational and compliance challenges and new litigation risks and scrutiny by federal and state regulators.
Although we take steps to protect our intellectual property and proprietary rights, we cannot be certain that the steps we have taken will be sufficient or effective to prevent the unauthorized access, use, copying, or the reverse engineering of our technology and other proprietary information, including by third parties who may use our technology or other proprietary information to develop services that compete with ours.
Although we take steps to protect our intellectual property and proprietary rights, we 14 cannot be certain that the steps we have taken will be sufficient or effective to prevent the unauthorized access, use, copying, or the reverse engineering of our technology and other proprietary information, including by third parties who may use our technology or other proprietary information to develop services that compete with ours.
The final rule also requires data providers holding a consumer account to establish a developer interface satisfying certain data security specifications and other standards, through which the data provider can receive requests for, and provide, specific types of data covered by 14 the rule in electronic, usable form to authorized third parties, including data aggregators.
The final rule also requires data providers holding a consumer account to establish a developer interface satisfying certain data security specifications and other standards, through which the data provider can receive requests for, and provide, specific types of data covered by the rule in electronic, usable form to authorized third parties, including data aggregators.
Whether a particular act or practice violates these laws or the prohibition against UDAPs frequently involves a highly subjective and/or fact-specific judgment. • Federal Marketing Laws. The Restore Online Shoppers’ Confidence Act (“ROSCA”), as well as the FTC’s Rule Concerning Recurring Subscriptions and Other Negative Option Programs, regulate subscriptions and other recurring on-line transactions.
Whether a particular act or practice violates these laws or the prohibition against UDAPs frequently involves a highly subjective and/or fact-specific judgment. 10 • Federal Marketing Laws. The Restore Online Shoppers’ Confidence Act (“ROSCA”), as well as the FTC’s Rule Concerning Recurring Subscriptions and Other Negative Option Programs, regulate subscriptions and other recurring on-line transactions.
Additionally, the MLA prohibits creditors from requiring covered borrowers to waive rights to legal recourse, submit to arbitration, or pay a prepayment penalty or fee. • Gramm-Leach-Bliley Act. The Gramm-Leach-Bliley Act (“GLBA”) imposes limitations on financial institutions’ disclosure of nonpublic personal information about a consumer to nonaffiliated 12 third parties.
Additionally, the MLA prohibits creditors from requiring covered borrowers to waive rights to legal recourse, submit to arbitration, or pay a prepayment penalty or fee. • Gramm-Leach-Bliley Act. The Gramm-Leach-Bliley Act (“GLBA”) imposes limitations on financial institutions’ disclosure of nonpublic personal information about a consumer to nonaffiliated third parties.
With expensive brick-and-mortar bank branch networks, antiquated technology, large employee bases, and inefficient customer acquisition strategies, legacy institutions have significant costs to serve their customers, which drives the high price that customers have to pay for access to their services.
With expensive brick-and-mortar branch networks, antiquated technology, large employee bases, and inefficient customer acquisition strategies, legacy institutions have significant costs to serve their customers, which drives the high price that customers have to pay for access to their services.
Additionally, in July 2024, the CFPB proposed an interpretive rule on paycheck advance and earned wage access, a model which Dave was originally founded on but transitioned away from beginning in 2022. 11 • Equal Credit Opportunity Act.
Additionally, in July 2024, the CFPB proposed an interpretive rule on paycheck advance and earned wage access, a model which Dave was originally founded on but transitioned away from beginning in 2022. • Equal Credit Opportunity Act.
This aspect of our business is subject to numerous privacy, cybersecurity, and other laws and regulations in the United States, including the federal GLBA and various state laws such as the California Consumer Privacy Act (“CCPA”).
This aspect of our business is subject to numerous privacy, cybersecurity, and other laws and regulations in the United States, including the federal 13 GLBA and various state laws such as the California Consumer Privacy Act (“CCPA”).
The Fair Credit Reporting Act (“FCRA”) and its implementing regulations, including Regulation V, is intended to promote the accuracy, fairness and privacy of information in the files of consumer reporting agencies.
The Fair Credit Reporting Act (“FCRA”) and its implementing regulations, including Regulation V, is intended to promote the accuracy, fairness and privacy of 11 information in the files of consumer reporting agencies.
We also believe these trends underscore a growing need for better financial solutions and illustrate the depth of our total addressable market (“TAM”), which we estimate to be approximately 180 million Americans that do not have access to affordable and effective banking solutions. We believe that these high costs are the result of the cost structure of incumbents.
We also believe these trends underscore a growing need for better financial solutions and illustrate the depth of our total addressable market (“TAM”), which we estimate to be approximately 185 million Americans that do not have access to affordable and effective banking solutions. We believe these high costs are the result of the cost structure of incumbents.
While we are not a “debt collector” under the FDCPA, which the statute defines as a person who regularly collects or attempts to collect, directly or indirectly, debts owed or due, or asserted to be owed or due, to another, we may use professional external debt collection agents to collect delinquent ExtraCash advances. • Military Lending Act.
While we are not a “debt collector” under the FDCPA, which the statute defines as a person who regularly collects or attempts to collect, directly or indirectly, debts owed or due, or asserted to be owed or due, to another, we may explore the use of professional external debt collection agents to collect delinquent ExtraCash advances. • Military Lending Act.
In October 2024, the CFPB finalized a rule under the Dodd-Frank Act, which would require a covered entity, including us and our bank partner, to, among other things, make available to a consumer, upon request, information in the covered entity’s control or possession concerning the consumer financial product or service that the consumer obtained from the covered entity.
In October 2024, the CFPB finalized a rule under the Dodd-Frank Act, which would require a covered entity, including us and our bank partners, to, among other things, make available to a consumer, upon request, information in the covered entity’s control or possession concerning the consumer financial product or service that the consumer obtained from the covered entity.
ITEM 1. BUSI NESS Unless otherwise noted or the context otherwise requires, the disclosures in this Item 1 refer to Dave Inc. and its consolidated subsidiaries following the consummation of the Business Combination .
ITEM 1. BUSI NESS Unless otherwise noted or the context otherwise requires, the disclosures in this Item 1 refer to Dave Inc. and its consolidated subsidiaries following the consummation of the Business Combination . Company Overview Dave Inc.
Regulation of our bank partnership model Pursuant to our partnership with Evolve, we offer our Members Federal Deposit Insurance Corporation (“FDIC”)-insured, non-interest-bearing deposit accounts (including the ExtraCash account), interest bearing deposit accounts and debit cards that Members can use to access their account balances. These deposit accounts and debit cards are provided by Evolve.
Regulation of our bank partnership model Pursuant to our partnerships with Evolve and Coastal, we offer our Members Federal Deposit Insurance Corporation (“FDIC”)-insured, non-interest-bearing deposit accounts (including the ExtraCash account), interest bearing deposit accounts and debit cards that Members can use to access their account balances. These deposit accounts and debit cards are provided by our bank partners.
New Laws and Regulations. Various federal and state regulatory agencies in the United States continue to examine a wide variety of issues that are applicable to us and may impact our business. These issues include consumer protection, marketing, cybersecurity, privacy, electronic transfers, state licensing, and the regulation of overdraft products.
Various federal and state regulatory agencies in the United States continue to examine a wide variety of issues that are applicable to us and may impact our business. These issues include consumer protection, marketing, cybersecurity, privacy, electronic transfers, state licensing, and the regulation of overdraft products.
For example, with respect to our ExtraCash product offered through Evolve, certain state laws may, if applicable, regulate the charges or fees that can be assessed and how settlements are obtained from our Members.
For example, with respect to our ExtraCash product offered through our bank partners, certain state laws may, if applicable, regulate the charges or fees that can be assessed and how settlements are obtained from our Members.
FHN research estimates there is approximately $38 billion of fees paid annually for access to basic checking services, including account maintenance fees, overdraft fees and ATM fees and that financially vulnerable and coping populations pay over $200 billion in annual fees and interest for short-term credit.
FHN research estimates there is approximately $43 billion of fees paid annually for access to basic checking services, including account maintenance fees, overdraft fees and ATM fees and that financially vulnerable and coping populations pay over $225 billion in annual fees and interest for short-term credit.
Bank Secrecy Act and Anti-Money Laundering. Given our involvement in payments, banking transactions, and our arrangements with Evolve, we are subject to compliance obligations related to U.S. anti-money laundering (“AML”) laws and regulations. We have developed and currently operate an AML program designed to prevent our products from being used to facilitate money laundering, terrorist financing, and other financial crimes.
Given our involvement in payments, banking transactions, and our arrangements with our partner banks, we are subject to compliance obligations related to U.S. anti-money laundering (“AML”) laws and regulations. We have developed and currently operate an AML program designed to prevent our products from being used to facilitate money laundering, terrorist financing, and other financial crimes.
Additionally, as a result of our partnership with Evolve, which provides ExtraCash via an overdraft account, deposit accounts and debit cards to our Members, we are also subject to regulation by bank regulators with supervisory authority over Evolve. Ensuring ongoing compliance with these laws and regulations imposes significant burdens on our business operations.
Additionally, as a result of our bank partnerships, which provide ExtraCash via an overdraft account, deposit accounts and debit cards to our Members, we are also subject to regulation by bank regulators with supervisory authority over our bank partners. Ensuring ongoing compliance with these laws and regulations imposes significant burdens on our business operations.
Under the terms of our agreement with Evolve, as well as the agreements between our Members and Evolve, each Member that chooses to open a deposit account has a deposit account at Evolve and a debit card issued by Evolve.
Under the terms of our agreements with our bank partners, as well as the agreements between our Members and our bank partners, each Member that chooses to open a deposit account has a deposit account at a bank partner and a debit card issued by a bank partner.
TISA and Regulation DD apply to the demand deposit accounts opened by our Members at Evolve . • Electronic Fund Transfer Act .
TISA and Regulation DD apply to the demand deposit accounts opened by our Members with our partner banks . • Electronic Fund Transfer Act .
Under the terms of the BSA, the Company's responsibilities include, among others, customer service, maintaining the technology and other aspects of the program that do not constitute banking or money transmission, and maintaining ledger accounting of funds held in each deposit account and other records required by Evolve or by law necessary to ensure "pass through" FDIC insurance coverage.
Under the BSA, Dave is responsible for customer service, maintaining the technology platform and other aspects of the program that do not constitute banking or money transmission, and maintaining ledger accounting of funds held in each deposit account and such other records required by Evolve or by law necessary to ensure FDIC pass-through insurance coverage.
In addition, if we are found to have engaged in activities subject to licensure for which we lack the requisite license, or in activities that are otherwise deemed to be in violation of lending laws, the relevant authority may impose fines, impose restrictions on our operations in the relevant state or locality, or seek other remedies for activities conducted in the state. 10 U.S. federal consumer protection requirements Here we summarize several of the material federal consumer protection and other laws applicable to our business.
In addition, if we are found to have engaged in activities subject to licensure for which we lack the requisite license, or in activities that are otherwise deemed to be in violation of lending laws, the relevant authority may impose fines, impose restrictions on our operations in the relevant state or locality, or seek other remedies for activities conducted in the state.
Our Quarterly Business Reviews now serve as pivotal moments for senior leaders to analyze key performance indicators, align on priorities for the upcoming quarter, and address strategic opportunities. These efforts have fostered greater accountability, more predictable business outcomes, stronger cross-functional collaboration, and a clearer understanding of how every team member contributes to our collective goals.
Our Weekly and Quarterly Business Reviews serve as pivotal moments for senior leaders to analyze key performance indicators, align on priorities, and address strategic opportunities. These efforts have fostered greater accountability, stronger cross-functional collaboration, and a clearer understanding of how every team member contributes to our collective goals. We have also invested meaningfully in people leadership.
We believe these insights are supported by a Dave study of our Members which reveals that traditional financial institutions charge consumers between $350-$400 of fees annually for access to basic checking services.
We believe these insights are supported by external data which reveals that traditional financial institutions charge consumers between $300-$400 of fees annually for access to basic checking services.
As such, our partnership with Evolve is subject to the supervision and enforcement authority of the Federal Reserve, Evolve’s primary regulator, the FDIC and Evolve's state banking regulator, the Arkansas State Bank Department.
As such, our partnerships with Evolve and Coastal are subject to the supervision and enforcement authority of the Federal Reserve, our bank partners' primary regulator, the FDIC, Evolve's state banking regulator, the Arkansas State Bank Department and Coastal's state banking regulator, the Washington Department of Financial Institutions.
Banks can also conduct risk assessments to assess controls for mitigating risk relating to specific third-party arrangements, engage in due diligence of third-party relationships, set appropriate contractual relationships, and establish monitoring routines to identify risks.
Banks can manage risk through policies and procedures governing organizational structures, lines of reporting, expertise and staffing, internal controls and audit functions. Banks can also conduct risk assessments to assess controls for mitigating risk relating to specific third-party arrangements, engage in due diligence of third-party relationships, set appropriate contractual relationships, and establish monitoring routines to identify risks.
Dave Checking Dave Checking is a digital demand deposit account offered through our bank partner with premium features, no account minimums or corresponding fees, and FDIC pass-through insurance eligibility that protects Members from the failure of our bank partner.
Dave Checking Dave Checking is a digital demand deposit account offered through our bank partners with premium features, no account minimums or corresponding fees, and Federal Deposit Insurance Corporation ("FDIC") pass-through insurance.
Regulatory Environment We operate in a complex regulatory environment consisting of U.S. federal and state laws that is rapidly evolving. These laws cover most aspects of our business and include laws, regulations, rules and guidance relating to, among other things, consumer finance and protection, privacy and data protection, anti-money laundering and know your customer requirements, banking, and payments.
These laws cover most aspects of our business and include laws, regulations, rules and guidance relating to, among other things, consumer finance and protection, privacy and data protection, anti-money laundering and know your customer requirements, banking, and payments.
With respect to these deposit accounts and debit cards, we act as the program manager and service provider to Evolve to provide customer support and technology features to Members using their Evolve accounts through our platform. Many laws and regulations that apply directly to Evolve indirectly impact us (and our products) as Evolve’s service provider.
With respect to these deposit accounts 12 and debit cards, we act as the program manager and service provider to our bank partner to provide customer support and technology features to Members using their Evolve or Coastal accounts through our platform.
Galileo also maintains cardholder information, implements certain fraud control processes and procedures, and provides related services in connection 8 with the ExtraCash and Dave Checking accounts and debit cards. In January 2023, we executed an amended agreement with Galileo that significantly reduced the fees that we pay to Galileo for these services.
Under this agreement, Galileo processes all transactions for ExtraCash, Dave Checking accounts, and Dave Debit Cards, and handles corresponding payments, adjustments, and settlement. Galileo also maintains cardholder information and implements certain fraud control processes and procedures. In January 2023, we executed an amended agreement with Galileo that significantly reduced processing fees.
Key products and features include: ExtraCash ExtraCash is a 0% interest overdraft product offered through our bank partner that provides Members access to up to $500 of credit to bridge liquidity gaps between paychecks. Through our proprietary artificial intelligence (“AI”)-powered underwriting system CashAI, we analyze a Member’s checking account transaction data to determine eligibility and offer amount.
ExtraCash ExtraCash is our flagship overdraft product, offered through our bank partners, that provides Members with up to $500 of credit in the form of a discretionary overdraft to bridge liquidity gaps between paychecks. Using our proprietary AI-powered underwriting system, CashAI, we analyze a Member's checking account transaction data to determine eligibility and set the bank's credit approval amount.
We, as well our partner bank that issues our debit card, are required to comply with the appropriate National Automated Clearing House Association (“NACHA”), bylaws, operating rules, and agreements, as well as card network rules and guidelines. NACHA operating rules further imposes maximum tolerances on the volume of ACH transfers that may be returned as unauthorized or for other reasons.
We, as well as each partner bank that issues our debit card, are required to comply with the appropriate National Automated Clearing House Association (“NACHA”), bylaws, operating rules, and agreements, as well as card network rules and guidelines.
We are subject to regulation by the Consumer Financial Protection Bureau (“CFPB”), which oversees compliance with and enforces federal consumer financial protection laws. The CFPB directly and significantly influences the regulation of consumer financial products and services, including the products and services we provide.
We must comply with various federal consumer protection regimes, both pursuant to the financial products and services we provide directly and as a service provider to Evolve. We are subject to regulation by the Consumer Financial Protection Bureau (“CFPB”), which oversees compliance with and enforces federal consumer financial protection laws.
We believe other market participants do not adequately meet the needs of an estimated approximately 180 million Americans who make up our target market. We believe our ease of access, speed-to-value, data-driven approach and powerful flywheel will allow us to continue to efficiently scale and generate strong returns.
We believe other market participants do not adequately meet the needs of the approximately 185 million Americans living paycheck to paycheck who make up our target market. Our ease of access, speed-to-value, data-driven approach, and efficient unit economics position us to continue scaling while generating attractive returns.
We believe that factors such as the technological and creative skills of our personnel and frequent enhancements to our network are also essential to establishing and maintaining our technology leadership position.
We believe that factors such as the technological and creative skills of our personnel and frequent enhancements to our network are also essential to establishing and maintaining our technology leadership position. See the section titled “ Risk Factors—Risks Related to Our Business and Industry ” for a more comprehensive description of risks related to our intellectual property and proprietary rights.
This process is entirely automated, does not require a credit check and does not rely on FICO or credit bureau data for decisioning. When an ExtraCash transaction is initiated, we schedule the settlement date based on the Member’s forecasted next paycheck or deposit date.
This fully automated process requires no credit check and does not rely on FICO or credit bureau data. Once an ExtraCash transaction is initiated, settlement is scheduled based on the Member's forecasted next paycheck or deposit date. In February 2025, we completed the transition to a simplified, transparent fee structure.
We also facilitate the electronic transfer of funds requested by our Members between their deposit accounts with our partner bank and their accounts at other financial institutions. Additional new products and services that we offer may also impose additional obligations on us to comply with NACHA and card network obligations related to preventing fraud, money laundering, and IT security breaches.
Additional new products and services that we offer may also impose additional obligations on us to comply with NACHA and card network obligations related to preventing fraud, money laundering, and IT security breaches. Bank Secrecy Act and Anti-Money Laundering.
Alongside market-competitive pay, we also offer a 401(k) match and access to a dedicated financial advisor, helping to ensure that every employee has the tools they need to plan for their future with confidence. As a fintech company, we are no strangers to navigating the unknown.
Compensation and Benefits Recognizing that financial wellness is core to our mission, we have made meaningful investments in compensation and benefits. Alongside market-competitive pay, we offer a 401(k) match and access to a dedicated financial advisor, helping ensure that every employee has the tools to plan for their future with confidence.
This market includes both young and financially challenged individuals who have trouble managing cash flow, have minimal savings, regularly overdraft, and pay high fees for access to financial services.
A December 2025 Report by PYMNTS also found that 67% of U.S. consumers were living paycheck to paycheck, up from 57% in 2021. This market includes both young and financially challenged individuals who have trouble managing cash flow, have minimal savings, regularly overdraft, and pay high fees for access to financial services.
These laws and regulations may be enforced by various state banking and consumer protection agencies, state attorneys general, the CFPB, the FTC and private litigants, among others. Card Association and Payment Network Rules. The bylaws and agreements between clearing house participants and bankcard companies impose specific responsibilities and liabilities for issuers of debit cards.
Card Association and Payment Network Rules. The bylaws and agreements between clearing house participants and bankcard companies impose specific responsibilities and liabilities for issuers of debit cards.
The CFPB has substantial power to regulate such products and services and the banks and non-bank entities that provide them, as well as their respective third-party service providers. This power includes rule making and enforcement authority in enumerated areas of federal law such as truth in lending, credit discrimination, electronic fund transfers and truth in savings.
This power includes rule making and enforcement authority in enumerated areas of federal law such as truth in lending, credit discrimination, electronic fund transfers and truth in savings.
Dave Checking accounts also include a physical Dave branded debit Mastercard (“Dave Card”) that can be used for everyday purchases and spending transactions as well as at any of the approximately 40,000 MoneyPass ATM network locations to make no-fee withdrawals at these in-network ATMs.
Members can open a Dave Checking account in minutes through our mobile application, add funds, and begin spending using a virtual or physical Dave branded debit Mastercard ("Dave Debit Card"). The Dave Debit Card can be used for everyday purchases as well as no-fee withdrawals at approximately 40,000 MoneyPass ATM network locations.
The guidance states that sound third-party risk management takes into account the level of risk, complexity, and size of the bank and the nature of the third-party relationship. In July 2024, these agencies also released a joint statement on banks’ arrangements with third parties to deliver bank deposit products and services.
In July 2024, these agencies also released a joint statement on banks’ arrangements with third parties to deliver bank deposit products and services. The joint statement cautions that operational and compliance risks arise when banks hand over substantial control of key functions to a third party.
Competitive Landscape Consumer financial services is a large, fragmented, and competitive market, and we compete in varying degrees with a range of existing providers of consumer-focused banking, lending, commerce and other financial products. Our competitors are generally large, well-capitalized financial services companies.
Competitive Landscape Consumer financial services is a large, fragmented, and competitive market. We compete in varying degrees with a range of providers across banking, lending, and other consumer financial products. Many of our current and potential competitors have longer operating histories, significantly greater financial, technical, and marketing resources, larger customer bases, and greater brand recognition.
According to the Financial Health Network (“FHN”) in 2024, approximately 180 million Americans are classified as financially “coping” or “vulnerable” representing over 70% of the U.S. population, up from 66% in 2021. A December 2024 report by PYMNTS also found that 65% of U.S. consumers were living paycheck to paycheck, up from 60% a year earlier.
Market Opportunity The U.S. financial system has historically failed to address the needs of the millions of Americans living paycheck to paycheck. According to the Financial Health Network (“FHN”) in 2025, approximately 185 million Americans are classified as financially “coping” or “vulnerable” representing 69% of the U.S. population, up from 66% in 2021.
Through this structural advantage, we are able to provide increased access to banking and credit products at lower costs, resulting in a much stronger value proposition to our Members. 4 Our Platform and Products We strive to deliver a seamless and intuitive Member experience across our product suite through the Dave mobile application.
By leveraging world-class technology and the power of data and AI, we have dramatically reduced the costs to serve customers in this market. Through this structural advantage, we are able to provide increased access to banking and credit products at lower costs, resulting in a much stronger value proposition to our Members.
We expect the same regulatory considerations to apply to this new bank partnership. 13 Other regulatory requirements In addition to the requirements described above, we are subject to and work to comply with other state and federal laws and regulations applicable to consumer financial products and services.
Other regulatory requirements In addition to the requirements described above, we are subject to and work to comply with other state and federal laws and regulations applicable to consumer financial products and services. These laws and regulations may be enforced by various state banking and consumer protection agencies, state attorneys general, the CFPB, the FTC and private litigants, among others.
Many states and localities have laws and regulations that are similar to the federal laws described, but the degree and nature of such laws and regulations vary from jurisdiction to jurisdiction. We must comply with various federal consumer protection regimes, both pursuant to the financial products and services we provide directly and as a service provider to Evolve.
U.S. federal consumer protection requirements Here we summarize several of the material federal consumer protection and other laws applicable to our business. Many states and localities have laws and regulations that are similar to the federal laws described, but the degree and nature of such laws and regulations vary from jurisdiction to jurisdiction.
We have engineered a purpose-driven platform designed to deliver on our mission, making a significant impact across the stakeholder groups we serve. Since our inception, more than 16 million Members have signed up for the Dave app, with over 12 million having used at least one of our products.
Since inception, over 19 million Members have signed up for the Dave app, with over 14 million having used at least one of our products.
Through our mobile-first platform, we deliver innovative financial products designed to help underserved consumers manage their money more effectively. Our mission is to level the financial playing field by providing intuitive, transparent, and accessible solutions that empower our Members to navigate life’s financial challenges with confidence.
Goliath, we set out to challenge legacy banking by leveraging technology to expand financial access and improve consumer financial health. Our mission is to level the financial playing field by providing intuitive, transparent, and accessible solutions that empower our Members to navigate life's financial challenges with confidence.
We have created a data-driven technology platform designed to deliver rapid, accurate, and Member-centric financial products that we believe provide us with sustainable competitive advantages.
Technology and Competitive Advantages Dave is a technology company at its core. We have built a data-driven platform that combines advanced AI and machine learning, real-time analytics, and seamless integration with external financial networks to deliver rapid, accurate, and Member-centric financial products.
By weaving this leadership philosophy into every stage of the employee journey, we are building a community of high-performing leaders who inspire their teams to drive our mission forward. Our strategic commitment to being a virtual first company continues to bear fruit. With team members in over 30 states, we have expanded our talent pool by removing geographic constraints.
Virtual-First Model Our strategic commitment to being a virtual-first company continues to drive results. With team members across more than 30 states, we have expanded our talent pool by removing geographic constraints.
We believe that this shift has not only broadened our team but also reduced voluntary turnover, which now is below the median rates of our peer set for 9 2024. The flexibility of remote work has boosted productivity while keeping our team size steady.
We believe this approach has broadened access to top talent, reduced voluntary turnover to below median rates for our peer group, and boosted productivity while keeping team size efficient.
In addition, laws and regulations that through expectations placed on Evolve by its regulators may indirectly affect us through requirements placed on us by Evolve to satisfy regulatory requirements. For example, the Federal Reserve, the FDIC and the Office of the Comptroller of the Currency have issued final guidance on managing risks associated with third-party relationships.
In addition, laws and regulations that through expectations placed on Evolve and Coastal by their respective regulators may indirectly affect us through requirements placed on us by our bank partners to satisfy regulatory requirements.
Building a company and culture that employees are proud of—and would recommend to their closest friends—is a continuous journey. To stay grounded in our team’s experience, we conduct engagement surveys, giving team members a confidential platform to share their feedback. These insights shape department-specific OKRs that address challenges and drive engagement.
Employee Engagement We conduct regular engagement surveys, providing team members a confidential platform to share feedback. These insights shape Company initiatives that address challenges and drive continuous improvement. With consistent 85%+ participation rates, our team trusts that their voices are heard and acted upon.
Customer funds are either held by Evolve in the customer deposit or sub-deposit accounts, or, where a customer has authorized a deposit or withdrawal, the funds are in transit through standard payment systems. Customer funds are eligible for FDIC insurance when held by Evolve, a member of the FDIC, in accordance with FDIC rules and regulations.
Under these arrangements, customer funds are held by our partner banks in deposit or sub-deposit accounts and are eligible for FDIC insurance up to the standard maximum deposit insurance amount in accordance with FDIC rules and regulations. Customer funds are not held by Dave or any third-party processor. Evolve Bank & Trust.
To balance this virtual model, we host bi-weekly company-wide all-hands meetings, encourage team offsites, host annual company-wide gatherings to foster connection, and provide co-working stipends to give employees the freedom to choose where they work best. Recognizing that financial wellness is core to Dave’s business, we have made meaningful investments in our compensation and benefits programs.
To maintain connection and collaboration, we host bi-weekly company-wide all-hands meetings, encourage team offsites, convene for annual company-wide gatherings, and provide co-working stipends that give employees flexibility in choosing where they work best. Leadership and Performance Management We have deeply integrated the OKR (Objectives and Key Results) framework into our culture, inspired by the practices of high-performing technology companies.
Our SEC filings are available to the public over the internet at the SEC’s website at www.sec.gov. Our SEC filings are also available free of charge on the Investor Relations portion of our website at dave.com as soon as reasonably practicable after they are filed with or furnished to the SEC.
Available Information Our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and any amendments to these reports are available free of charge on our investor relations website at investors.dave.com as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC.
However, attracting and retaining top talent requires more than a compelling mission. That is why we have made meaningful strides in becoming a truly exceptional place to work. We have deeply integrated the OKR (Objectives and Key Results) framework into our culture and ways of working, inspired by the best practices of high-performing technology companies.
However, attracting and retaining top talent requires more than a compelling mission, which is why we have made meaningful investments in becoming an exceptional place to work. Dave has earned multiple Best Place to Work recognitions from Built In over the past several years, reflecting our ongoing investment in becoming an exceptional workplace.
Additionally, our proprietary Machine Learning Platform enables our team to develop, train, test, and deploy new AI models with minimal engineering support, which enables rapid innovation and iteration in response to market dynamics. • Scalable & Agile Infrastructure: Dave’s cloud-native architecture and proprietary banking integrations provide significant scalability and flexibility.
This architecture provides significant advantages: • Cost efficiency: AI-powered automation and digital-only operations significantly reduce our cost to serve, enabling competitive pricing for Members. • Scalability: Our infrastructure supports Member growth without proportional cost increases. • Multi-bank flexibility: Proprietary integrations allow us to work with multiple sponsor banks, reducing concentration risk and enabling operational resilience. • Rapid innovation: Our proprietary Machine Learning Platform enables our team to develop, train, and deploy new AI models with minimal engineering support, accelerating product iteration in response to market dynamics.
Exceeding those tolerances may result in limitations being imposed on our ability to initiate ACH transactions. Many transfers of funds in connection with the provision and repayment of our ExtraCash overdrafts are performed by electronic fund transfers, including ACH transfers.
Many transfers of funds in connection with the provision and settlement of our ExtraCash overdrafts are performed by electronic fund transfers, including ACH transfers. We also facilitate the electronic transfer of funds requested by our Members between their deposit accounts with our partner banks and their accounts at other financial institutions.
Our partnership with Evolve allows us to offer ExtraCash as well as other deposit accounts and debit cards while complying with various federal, state, and other laws. Evolve also sponsors access to debit networks and ACH for payment transactions, funding transactions and associated settlement of funds.
We are party to a Bank Services Agreement ("BSA") with Evolve Bank & Trust ("Evolve"), under which Evolve issues and maintains deposit accounts, and sponsors access to debit networks and ACH for payment transactions, funding transactions, and associated settlement of funds.
We believe we can continue to make improvements to the ExtraCash value proposition that unlock transacting Member growth through stronger conversion and retention and ARPU expansion by growing average originations per Member. Increase adoption of the Dave Card : cross-selling Members into the Dave Card represents an attractive opportunity to drive both increased ARPU and average customer lifetimes.
Deepen Relationships Through the Dave Debit Card. Cross-selling Members into the Dave Debit Card represents an attractive opportunity to drive both increased ARPU and average customer lifetimes. Dave Debit Card actives generate approximately 1.7x higher average monthly ARPU than non-Dave Debit Card actives, with stronger retention profiles.
The Budget tool leverages historical bank account data to help Members understand both recurring and commonly occurring charges, helping Members understand potential upcoming transactions that might impact their balance. Budget also notifies Members when there is a chance of an overdraft. Side Hustle Side Hustle is a streamlined job application portal for Dave Members to find supplemental or temporary work.
Personal Financial Management We offer a suite of personal financial management tools to help Members improve their financial health: • Budget: Utilizes historical bank account data to identify recurring charges, enabling Members to anticipate upcoming transactions and receive timely notifications when there is a risk of an overdraft. • Goals: A savings tool that allows Members to set aside money for short- or long-term goals, track progress, and automate savings. • Side Hustle: A streamlined job application portal for Members to find supplemental or temporary "gig economy," part-time, seasonal, remote, and other flexible employment opportunities.
As we continue to scale and diversify our business, we remain focused on building and nurturing top-tier leadership. Talent and Culture Every day, our nimble and innovative team comes together in an effort to level the financial playing field. This shared mission—empowering millions of current and future Members—fuels our passion and purpose.
None of our employees are represented by a labor union or covered by a collective bargaining agreement. Our Culture and Mission Every day, our team comes together to level the financial playing field—empowering millions of Members to take control of their financial lives. This shared mission fuels our passion and purpose.
The larger our transacting Member base becomes, we expect the better our systems are able to identify responsible customers and the more Members we can acquire and approve, creating a powerful flywheel. We believe we have among the strongest user acquisition engines in the industry, driven by our data driven marketing strategy and strong value proposition.
The 5 larger our transacting Member base becomes, the better our systems are able to identify responsible customers, creating a powerful flywheel. Engage Members Through ExtraCash. We are focused on establishing ExtraCash as the best short-term credit product in the market.
Dave Checking offers security controls such as multi-factor authentication, contactless payment, instant card lock and protection against unauthorized purchases if cards are lost or stolen. 5 Dave Checking revenues are primarily driven by merchant interchange, incentives from Mastercard, interest on deposits paid by our partner banks, and other ancillary fees paid by customers (e.g. out of network ATM fees, instant withdrawal fees).
Revenues are primarily driven by merchant interchange, Mastercard incentives, interest on deposits paid by our partner banks, and other ancillary fees.
We plan to add features and additional value propositions associated with Dave Card usage that we believe will create stronger motivation for usage, further supporting our growth objectives. 6 Leverage our data advantage and technology to build new products: The capabilities we have established in cashflow underwriting through CashAI, engineering, risk and fraud management, payments, and bank sponsor relationships, among others, provide us a unique foundation to launch additional products in the future.
Dave Debit Card actives have approximately 11 times the average monthly transaction volume of non-Dave Debit Card actives. Launch New Products. We believe the capabilities we have established in cashflow underwriting, engineering, risk and fraud management, payments, and bank sponsor relationships provide a strong foundation to launch additional products. We are developing and expect to launch new products in 2026.
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Company Overview Dave was launched in 2017 to provide a faster, more transparent, and lower-cost alternative to traditional financial institutions, particularly for those living paycheck to paycheck. Inspired by the story of David vs. Goliath, we set out to challenge legacy banking by leveraging technology to expand financial access and improve consumer financial health.
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("Dave," the "Company," "we," "us," or "our") is one of the nation's leading neobanks, providing a mobile-first financial services platform designed to help everyday Americans manage their money more effectively.
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We have provided Members with more than $15 billion in ExtraCash, offering critical liquidity when they need it most. To further support our communities, we have donated approximately $23 million to charity and important causes since inception. Customers value our products, as demonstrated by more than 700,000 App Store reviews with an average 4.8-star rating as of February 2025.
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We serve millions of Members who are often underserved by traditional financial institutions, offering them access to short-term liquidity, fee-free banking, and financial management tools at a fraction of the cost of incumbents. Founded in 2017 and inspired by the story of David vs.
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Our business model is built on transparency and customer alignment and building relationships with our Members that drive positive outcomes for both them and our business. At the core of our success is a world-class team dedicated to delivering on our mission.
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Our flagship product, ExtraCash, provides Members with up to $500 of short-term credit (in the form of discretionary overdraft through a bank partner) to bridge liquidity gaps between paychecks, without interest, late fees, or credit checks.
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Dave has been recognized by Built In as a Best Place to Work for five consecutive years, reinforcing our commitment to both our Members and employees. Market Opportunity The U.S. financial system has historically failed to address the needs of the millions of Americans who are living paycheck to paycheck.
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We use our proprietary AI-powered underwriting engine, CashAI, to evaluate each Member's cash flow in real-time, enabling us to extend credit responsibly while maintaining strong unit economics. To date, we have provided Members with over $22 billion in ExtraCash, offering critical liquidity when they need it most.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeIn addition, if the prices we charge for our products and services are unacceptable to our Members, our operating results will be harmed. • Use of artificial intelligence in our operations and product offerings could result in reputational or competitive harm, legal or regulatory liability and adverse impacts on our results of operations. • We may not be able to scale our business on a timely basis to meet our Members’ growing needs, and if we are not able to grow efficiently, our operating results could be harmed. • We currently rely on a single bank partner, and if our present or any future key banking relationships are terminated and we are not able to secure or successfully migrate client portfolios to a new bank partner or partners, or our bank partner becomes subject to regulatory restrictions or other operational disruptions, our business would be adversely affected. • We depend upon several third-party service providers to process our transactions and provide other important services for our business.
Biggest changeIn addition, if the prices we charge for our products and services are unacceptable to our Members, our operating results will be harmed. • Use of AI in our operations and product offerings could result in reputational or competitive harm, legal or regulatory liability and adverse impacts on our results of operations. • We may not be able to scale our business on a timely basis to meet our Members’ growing needs, and if we are not able to grow efficiently, our operating results could be harmed. • We rely on two bank partners, but intend to eventually rely on one bank partner.
Further, negative publicity arising our Members not benefiting from pass-through deposit insurance in the event of a failure of our partner bank could be damaging to our reputation and may adversely impact use of our products and services, including our platform, and adversely affect our ability to attract new Members and business partners.
Further, negative publicity arising from our Members not benefiting from pass-through deposit insurance in the event of a failure of a partner bank could be damaging to our reputation and may adversely impact use of our products and services, including our platform, and adversely affect our ability to attract new Members and business partners.
Our rapid growth also makes it difficult to evaluate our future prospects and may increase the risk that we will not continue to be successful. • If we are unable to acquire new Members and retain our current Members or sell additional functionality and services to them, our revenue growth will be adversely affected. • Fraudulent and other illegal activity involving our products and services could lead to reputational damage to us, cause us to incur financial losses, reduce the use of our platform and services and may adversely affect our financial position and results of operations. • We receive funds from, and transfer funds to, our Members daily, which in the aggregate comprise substantial sums, and are subject to the risk of errors, which could result in financial losses, damage to our reputation, or loss of trust in our brand, which would harm our business and financial results. • Cyberattacks and other security breaches or disruptions suffered by us or third parties upon which we rely could have a materially adverse effect on our business, harm our reputation and expose us to public scrutiny and liability. 17 • Dave has historically incurred losses in the operation of its business.
Our rapid growth also makes it difficult to evaluate our future prospects and may increase the risk that we will not continue to be successful. • If we are unable to acquire new Members and retain our current Members or sell additional functionality and services to them, our revenue growth will be adversely affected. • Fraudulent and other illegal activity involving our products and services could lead to reputational damage to us, cause us to incur financial losses, reduce the use of our platform and services and may adversely affect our financial position and results of operations. • We receive funds from, and transfer funds to, our Members daily, which in the aggregate comprise substantial sums, and are subject to the risk of errors, which could result in financial losses, damage to our reputation, or loss of trust in our brand, which would harm our business and financial results. • Cyberattacks and other security breaches or disruptions suffered by us or third parties upon which we rely could have a materially adverse effect on our business, harm our reputation and expose us to public scrutiny and liability. • Dave has historically incurred losses in the operation of its business.
Our business and prospects should be considered in light of the risks and significant challenges we face as a new entrant in our industry, including, among other things, with respect to our ability to: • build a well-recognized, trusted and respected brand; • establish and expand our Member base; • successfully market our products and services; • properly price our services and successfully anticipate the usage of such services by our Members; • improve and maintain our operational efficiency; • maintain a reliable, secure, high-performance and scalable technology infrastructure; • predict our future revenues and appropriately budget our expenses; • attract, retain and motivate talented employees; • anticipate trends that may emerge and affect our business; • anticipate and adapt to changing market conditions, including technological developments and changes in competitive landscape; and • navigate an evolving and complex regulatory environment.
Our business and prospects should be considered in light of the risks and significant challenges we face as a new entrant in our industry, including, among other things, with respect to our ability to: • build a well-recognized, trusted and respected brand; • establish and expand our Member base; • successfully market our products and services; • properly price our services and successfully anticipate the usage of such services by our Members; • improve and maintain our operational efficiency; 32 • maintain a reliable, secure, high-performance and scalable technology infrastructure; • predict our future revenues and appropriately budget our expenses; • attract, retain and motivate talented employees; • anticipate trends that may emerge and affect our business; • anticipate and adapt to changing market conditions, including technological developments and changes in competitive landscape; and • navigate an evolving and complex regulatory environment.
Our amended and restated certificate of incorporation provides that, unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware is the sole and exclusive forum for (i) any derivative action or proceeding brought on behalf of us, (ii) any action asserting a claim of breach of a duty (including any fiduciary duty) owed by any of our current or former directors, officers, stockholders, employees or agents to us or our stockholders, (iii) any action asserting a claim against us or any of our current or former directors, officers, stockholders, employees or agents arising out of or relating to any provision of the DGCL or our amended and restated certificate of incorporation or our bylaws, (iv) any action or proceeding to interpret, apply, enforce or determine the validity of our amended and restated certificate of incorporation or our bylaws; (v) any action or proceeding as to which the Delaware General Corporation Law confers jurisdiction to the Court of Chancery of the State of Delaware; and (vi) any action asserting a claim against us or any of our current or former directors, officers, stockholders, employees or agents governed by the internal affairs doctrine of the State of Delaware.
Our amended and restated certificate of incorporation provides that, unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware is the sole and exclusive forum for (i) any derivative action or proceeding brought on behalf of us, (ii) any action asserting a claim of breach of a duty (including any fiduciary duty) owed by any of our current or former directors, officers, stockholders, employees or 46 agents to us or our stockholders, (iii) any action asserting a claim against us or any of our current or former directors, officers, stockholders, employees or agents arising out of or relating to any provision of the DGCL or our amended and restated certificate of incorporation or our bylaws, (iv) any action or proceeding to interpret, apply, enforce or determine the validity of our amended and restated certificate of incorporation or our bylaws; (v) any action or proceeding as to which the Delaware General Corporation Law confers jurisdiction to the Court of Chancery of the State of Delaware; and (vi) any action asserting a claim against us or any of our current or former directors, officers, stockholders, employees or agents governed by the internal affairs doctrine of the State of Delaware.
On August 21, 2024, the FTC staff sent the Company a proposed consent order and draft complaint, alleging that the Company had violated Section 5(a) of the Federal Trade Commission Act (“FTC Act”) which prohibits “unfair or deceptive acts or practices in or affecting commerce” and certain provisions of the Restore Online Shoppers’ Confidence Act related to the Company’s platform and offering of the ExtraCash Product (the “Complaint”), and advising that it would recommend the filing of an enforcement action if the Company did not settle the FTC’s claims.
On August 21, 2024, the FTC staff sent the Company a proposed consent order and draft complaint, alleging that the Company had violated Section 5(a) of the Federal Trade Commission Act (“FTC Act”) which prohibits “unfair or 36 deceptive acts or practices in or affecting commerce” and certain provisions of the Restore Online Shoppers’ Confidence Act related to the Company’s platform and offering of the ExtraCash Product (the “Complaint”), and advising that it would recommend the filing of an enforcement action if the Company did not settle the FTC’s claims.
If a court or a state or federal enforcement agency were to determine that Dave—rather than its bank partner—is the “true lender” for ExtraCash overdrafts, and that for this reason (or any other reason) our business is thus subject to and in violation of certain consumer finance laws and regulations, it could materially adversely affect our business and subject us to fines, damages, injunctive relief (including required modification or discontinuation of our business in certain areas), and other penalties or consequences, and render void or enforceable in whole or in part transactions originated through a bank partner.
If a court or a state or federal enforcement agency were to determine that Dave—rather than its bank partner—is the equivalent of the “true lender” for ExtraCash overdrafts, and that for this reason (or any other reason) our business is thus subject to and in violation of certain consumer finance laws and regulations, it could materially adversely affect our business and subject us to fines, damages, injunctive relief (including required modification or discontinuation of our business in certain areas), and other penalties or consequences, and render void or enforceable in whole or in part transactions originated through a bank partner.
These factors include: • actual or anticipated fluctuations in operating results; • failure to meet or exceed financial estimates and projections of the investment community or that Dave provides to the public; 46 • issuance of new or updated research or reports by securities analysts or changed recommendations for the industry in general; • announcements of significant acquisitions, strategic partnerships, joint ventures, collaborations or capital commitments; • operating and share price performance of other companies in the industry or related markets; • the timing and magnitude of investments in the growth of the business; • actual or anticipated changes in laws and regulations; • investigations, claims, disputes, enforcement actions, litigation and/or other regulatory or legal proceedings, including with respect to the DOJ's Amended Complaint; • additions or departures of key management or other personnel; • increased labor costs; • disputes or other developments related to intellectual property or other proprietary rights, including litigation; • the ability to market new and enhanced solutions on a timely basis; • sales of substantial amounts of the Dave Class A Common Stock by Dave’s directors, executive officers or significant stockholders or the perception that such sales could occur; • limited liquidity and trading volumes in the Dave Class A Common Stock; • changes in capital structure, including future issuances of securities or the incurrence of debt; and • general economic, political and market conditions, including fluctuating interest rates.
These factors include: • actual or anticipated fluctuations in operating results; • failure to meet or exceed financial estimates and projections of the investment community or that Dave provides to the public; • issuance of new or updated research or reports by securities analysts or changed recommendations for the industry in general; • announcements of significant acquisitions, strategic partnerships, joint ventures, collaborations or capital commitments; • operating and share price performance of other companies in the industry or related markets; • the timing and magnitude of investments in the growth of the business; 45 • actual or anticipated changes in laws and regulations; • investigations, claims, disputes, enforcement actions, litigation and/or other regulatory or legal proceedings, including with respect to the DOJ's Amended Complaint; • additions or departures of key management or other personnel; • increased labor costs; • disputes or other developments related to intellectual property or other proprietary rights, including litigation; • the ability to market new and enhanced solutions on a timely basis; • sales of substantial amounts of the Dave Class A Common Stock by Dave’s directors, executive officers or significant stockholders or the perception that such sales could occur; • limited liquidity and trading volumes in the Dave Class A Common Stock; • changes in capital structure, including future issuances of securities or the incurrence of debt; and • general economic, political and market conditions, including fluctuating interest rates.
Our business depends on our employees, contractors and third-party service providers to facilitate the operation of our business and process a large number of increasingly complex transactions, and if any of our employees, contractors or third-party service providers provide unsatisfactory service or take, convert or misuse funds, documents or data (including Member and/or internal documents or data), make an error, or fail to follow protocol (including when interacting with Members), we could lose Members, harm our reputation, be liable for damages, be subject to repurchase obligations and be subject to complaints, regulatory actions and penalties.
Our business depends on our employees, contractors and third-party service providers to facilitate the operation of our business and process a large number of increasingly complex transactions, and if any of our employees, contractors or third-party service providers provide unsatisfactory service or take, convert or misuse funds, documents or data (including Member and/or internal documents or data), make an error, or fail to follow protocol (including when interacting with Members), we could lose Members, harm our reputation, be liable for damages, be subject to repurchase obligations and be subject to complaints, litigation, regulatory actions and penalties.
Any perceived or actual breach of security, regardless of how it occurs or the extent of the breach, could have a significant impact on our reputation as a trusted brand, cause us to lose existing partners or Members, prevent us from obtaining new partners and Members, require us to expend significant funds to remedy problems caused by breaches and implement measures to prevent further breaches, and expose us to legal risk and potential liability including from governmental or 29 regulatory investigations, class action litigation and other lawsuits.
Any perceived or actual breach of security, regardless of how it occurs or the extent of the breach, could have a significant impact on our reputation as a trusted brand, cause us to lose existing partners or Members, prevent us from obtaining new partners and Members, require us to expend significant funds to remedy problems caused by breaches and implement measures to prevent further breaches, and expose us to legal risk and potential liability including from governmental or regulatory investigations, class action litigation and other lawsuits.
In addition, a number of participants in the consumer finance industry have been the subject of putative class action lawsuits; state attorney general actions and other state regulatory actions; federal regulatory enforcement actions, including actions relating to alleged unfair, deceptive, or abusive acts or practices; violations of state licensing and 45 lending laws, including state interest rate limits; actions alleging discrimination on the basis of race, ethnicity, gender, or other prohibited bases; and allegations of noncompliance with various state and federal laws and regulations relating to originating and servicing consumer finance loans.
In addition, a number of participants in the consumer finance industry have been the subject of putative class action lawsuits; state attorney general actions and other state regulatory actions; federal regulatory enforcement actions, including actions relating to alleged unfair, deceptive, or abusive acts or practices; violations of state licensing and lending laws, including state interest rate limits; actions alleging discrimination on the basis of race, ethnicity, gender, or other prohibited bases; and allegations of noncompliance with various state and federal laws and regulations relating to originating and servicing consumer finance loans.
These initiatives, or similar actions by federal and state regulators, may increase compliance costs associated with our business or impact our relationships with our current partner bank or any future partner bank, limit our ability to offer our Members deposit accounts through “for-benefit-of” arrangements with our partner bank, or restrict the availability or marketing of pass-through deposit insurance for such accounts, which could adversely impact use of our products and services, including our platform, and adversely affect our ability to attract new Members and business partners.
These initiatives, or similar actions by federal and state regulators, may increase compliance costs associated with our business or impact our relationships with our current partner banks or any future partner bank, limit our ability to offer our Members deposit accounts through “for-benefit-of” arrangements with our partner banks, or restrict the availability or marketing of pass-through deposit insurance for such accounts, which could adversely impact use of our products and services, including our platform, and adversely affect our ability to attract new Members and business partners.
Any damage to, or failure of, third party computer network 24 systems or data centers generally, or those of our vendors (including as a result of disruptions at our third-party data center hosting facilities and cloud providers), or an improper action by our employees, agents or third-party vendors, could result in interruptions in our services, causing Members and other partners to become dissatisfied with our products and services or subject us to potential financial losses.
Any damage to, or failure of, third party computer network systems or data centers generally, or those of our vendors (including as a result of disruptions at our third-party data center hosting facilities and cloud providers), or an improper action by our employees, agents or third-party vendors, could result in interruptions in our services, causing Members and other partners to become dissatisfied with our products and services or subject us to potential financial losses.
Any real or perceived errors, failures, bugs, or defects in the software may not be found until our Members use our platform and could result in outages or degraded quality of service on our platform that could adversely impact our business, as well as cause negative publicity, loss of or delay in market acceptance of our products and services, and harm to our brand or weakening of our competitive position.
Any real or perceived errors, failures, bugs, or defects in the software may not be found until our Members use our platform and could result in outages or degraded quality of service on our platform that could adversely impact our 27 business, as well as cause negative publicity, loss of or delay in market acceptance of our products and services, and harm to our brand or weakening of our competitive position.
This may require us to expend substantial resources, discontinue certain products, or cease providing services to a certain Members, which would negatively affect our business, financial condition, and operating results. In addition, the increased attention focused upon liability issues as a result of lawsuits and legislative proposals could harm our reputation or otherwise adversely affect the growth of our business.
This may require us to expend substantial resources, discontinue certain products, or cease providing services to certain Members, which would negatively affect our business, 43 financial condition, and operating results. In addition, the increased attention focused upon liability issues as a result of lawsuits and legislative proposals could harm our reputation or otherwise adversely affect the growth of our business.
Actual events involving limited liquidity, defaults, non-performance or other adverse developments that affect financial institutions, transactional counterparties or other companies in the financial services industry or the financial services industry generally, or concerns or rumors about any events of these kinds or other similar risks, have in the past and may in the future lead to market-wide liquidity problems and adversely affect our financial condition and results of operations.
Actual events involving limited liquidity, defaults, non-performance or other adverse developments that affect financial institutions, transactional counterparties or other companies in the financial services industry or the 34 financial services industry generally, or concerns or rumors about any events of these kinds or other similar risks, have in the past and may in the future lead to market-wide liquidity problems and adversely affect our financial condition and results of operations.
In particular, legal proceedings brought under state consumer protection statutes or under several of the various federal consumer financial services statutes subject to the jurisdiction of the CFPB and FTC may result in a separate fine for each violation of the statute, which, particularly in the case of class action lawsuits, could result in damages in excess of the amounts we earned from the underlying activities.
In particular, legal proceedings brought under state consumer protection statutes or under several of the various federal consumer financial services statutes subject to the 44 jurisdiction of the CFPB and FTC may result in a separate fine for each violation of the statute, which, particularly in the case of class action lawsuits, could result in damages in excess of the amounts we earned from the underlying activities.
Furthermore, other characteristics of ExtraCash overdrafts may increase the risk of default or fraud and there are few restrictions on the uses that may be made of ExtraCash overdrafts by borrowers, which may result in increased levels of credit consumption. These factors may reduce the amounts received from ExtraCash receivables and adversely affect our operating results and financial condition.
Furthermore, other characteristics of ExtraCash overdrafts may increase the risk of default or fraud and there are few restrictions on the uses that may be made of ExtraCash overdrafts by borrowers, which may result in increased levels of credit consumption. These factors may 18 reduce the amounts received from ExtraCash receivables and adversely affect our operating results and financial condition.
Our fraud detection and risk control mechanisms may not prevent all fraudulent or illegal activity, and the regulations and payment network rules may become more onerous, causing additional losses for us. To the extent we incur losses from disputed transactions, our business, results of operations and financial condition could be materially and adversely affected.
Our fraud detection and risk control mechanisms may not prevent all fraudulent or illegal activity, and the regulations and payment network rules may become more onerous, causing additional losses for us. To the extent we incur 26 losses from disputed transactions, our business, results of operations and financial condition could be materially and adversely affected.
As a result of plans to expand Dave’s business operations, including to jurisdictions in which tax laws may not be favorable, its obligations may change or fluctuate, become significantly more complex or become subject to greater risk of examination by taxing authorities, any of which could adversely affect Dave’s after-tax profitability and financial results.
As a result of plans to expand Dave’s business operations, including to jurisdictions in which tax laws may not be favorable, its obligations may change or fluctuate, become significantly more complex or become subject to 47 greater risk of examination by taxing authorities, any of which could adversely affect Dave’s after-tax profitability and financial results.
If we fail to comply with the applicable requirements relating to deposit insurance, our Members could be harmed in the event of a failure of our bank partner and we could be subject to enforcement actions, claims from third 22 parties, including our Members, and suffer economic and reputational harm that could have an adverse effect on our business.
If we fail to comply with the applicable requirements relating to deposit insurance, our Members could be harmed in the event of a failure of our bank partner and we could be subject to enforcement actions, claims from third parties, including our Members, and suffer economic and reputational harm that could have an adverse effect on our business.
Regulators have broad discretion with respect to the interpretation, implementation, and enforcement of these laws and regulations, 37 including through enforcement actions that could subject us to civil money penalties, Member remediation, increased compliance costs, and limits or prohibitions on our ability to offer certain products or services or to engage in certain activities.
Regulators have broad discretion with respect to the interpretation, implementation, and enforcement of these laws and regulations, including through enforcement actions that could subject us to civil money penalties, Member remediation, increased compliance costs, and limits or prohibitions on our ability to offer certain products or services or to engage in certain activities.
We have also recently received an inquiry from the Maryland banking regulator regarding licensure and the State Regulatory Changes, and a subpoena from the Maryland Attorney General requesting information regarding any earned wage access and related products that we offer in the state of Maryland, including information relating to marketing practices, fees, our bank partnership, and other issues.
We have also received an inquiry from the Maryland banking regulator regarding licensure and the State Regulatory Changes, and a subpoena from the Maryland Attorney General requesting information regarding any earned wage access and related products that we offer in the state of Maryland, including information relating to marketing practices, fees, our bank partnership, and other issues.
Many existing and potential competitors are entities substantially larger in size and more established, including with greater resources, highly diversified revenues and significantly more brand awareness than ours. As such, many of 18 our competitors can leverage their size, robust networks, financial wherewithal, brand awareness, pricing power and technological assets to compete with us.
Many existing and potential competitors are entities substantially larger in size and more established, including with greater resources, highly diversified revenues and significantly more brand awareness than ours. As such, many of our competitors can leverage their size, robust networks, financial wherewithal, brand awareness, pricing power and technological assets to compete with us.
The financial services industry continues to be highly regulated and subject to new laws or regulations in many jurisdictions, including the U.S. states in which we operate, which could restrict the products and services we offer, impose additional compliance costs on us, render our current operations unprofitable or even prohibit our current or future operations.
The financial services industry continues to be highly regulated and subject to new laws or regulations in many jurisdictions, including the U.S. states and localities in which we operate, which could restrict the products and services we offer, impose additional compliance costs on us, render our current operations unprofitable or even prohibit our current or future operations.
It is unclear whether these or similar changes will be enacted and, if enacted, how 48 soon any such changes could take effect. The passage of any legislation as a result of these proposals and other similar changes in U.S. federal income tax laws could adversely affect Dave’s business and future profitability.
It is unclear whether these or similar changes will be enacted and, if enacted, how soon any such changes could take effect. The passage of any legislation as a result of these proposals and other similar changes in U.S. federal income tax laws could adversely affect Dave’s business and future profitability.
Accordingly, we could be adversely impacted to the extent our third-party vendors fail to comply with legal requirements applicable to the particular products or services being offered. 23 In some cases, third-party vendors are the sole source, or one of a limited number of sources, of the services they provide to us.
Accordingly, we could be adversely impacted to the extent our third-party vendors fail to comply with legal requirements applicable to the particular products or services being offered. In some cases, third-party vendors are the sole source, or one of a limited number of sources, of the services they provide to us.
High profile fraudulent activity or significant increases in fraudulent activity could also lead to regulatory intervention, negative 27 publicity and the erosion of trust from our Members, which could negatively impact our results of operations, brand and reputation, and require us to take steps to reduce fraud risk, which could increase our costs.
High profile fraudulent activity or significant increases in fraudulent activity could also lead to regulatory intervention, negative publicity and the erosion of trust from our Members, which could negatively impact our results of operations, brand and reputation, and require us to take steps to reduce fraud risk, which could increase our costs.
If Dave identifies additional material weaknesses in the future or otherwise fails to maintain effective internal control over financial reporting, it may not be able to accurately or timely report its financial condition or results of operations, which may adversely affect Dave’s business and share price.
If Dave identifies material weaknesses in the future or otherwise fails to maintain effective internal control over financial reporting, it may not be able to accurately or timely report its financial condition or results of operations, which may adversely affect Dave’s business and share price.
In June 2024, Evolve became subject to a consent order issued by its primary regulator, the Board of Governors of the Federal Reserve System (“Federal Reserve Board”), that imposes restrictions on Evolve’s operations and risk management practices. The recent bankruptcy of Synapse Financial Technologies, Inc.
In June 2024, Evolve became subject to a consent order issued by its primary regulator, the Board of Governors of the Federal Reserve System (“Federal Reserve Board”), that imposes restrictions on Evolve’s operations and risk management practices. The bankruptcy of Synapse Financial Technologies, Inc.
Further, in some cases, regardless of fault, it may be less time-consuming or costly to settle these matters, which may require us to implement certain changes to our business practices, provide remediation to certain individuals or make a settlement payment to a given party or regulatory body.
Further, in some cases, regardless of fault, it may be less time-consuming or costly to settle these matters, which may require us to implement certain changes 37 to our business practices, provide remediation to certain individuals or make a settlement payment to a given party or regulatory body.
Our Members may not view ExtraCash overdrafts facilitated through our platform as having the same significance as other credit obligations arising under more traditional circumstances. ExtraCash overdrafts facilitated through our platform are not secured by any collateral, not guaranteed or insured by any third party, and not backed by any governmental authority in any way.
Our Members may not view ExtraCash overdrafts facilitated through our platform as having the same significance as other obligations arising under more traditional circumstances. ExtraCash overdrafts facilitated through our platform are not secured by any collateral, not guaranteed or insured by any third party, and not backed by any governmental authority in any way.
Even if we are successful 21 in these efforts to scale our business, they will be expensive and complex, and require the dedication of significant management time and attention. We could also face inefficiencies or service disruptions as a result of our efforts to scale our internal infrastructure.
Even if we are successful in these efforts to scale our business, they will be expensive and complex, and require the dedication of significant management time and attention. We could also face inefficiencies or service disruptions as a result of our efforts to scale our internal infrastructure.
Such conditions are also likely to affect the ability and willingness of 36 consumers to pay amounts owed under ExtraCash overdrafts facilitated through our platform, each of which would have an adverse effect on our business, results of operations, financial condition, and future prospects.
Such conditions are also likely to affect the ability and willingness of consumers to pay amounts owed under ExtraCash overdrafts facilitated through our platform, each of which would have an adverse effect on our business, results of operations, financial condition, and future prospects.
Pursuant to the Investor Rights Agreement, certain holders are entitled to, among other things, certain registration rights, including the demand of up to three underwritten offerings and customary piggyback registration rights. 51 Further, pursuant to the Subscription Agreements, we are also required to register additional shares of Dave Class A Common Stock.
Pursuant to the Investor Rights Agreement, certain holders are entitled to, among other things, certain registration rights, including the demand of up to three underwritten offerings and customary piggyback registration rights. Further, pursuant to the Subscription Agreements, we are also required to register additional shares of Dave Class A Common Stock.
If accounting standards change or if our estimates or assumptions relating to our critical accounting policies prove to be incorrect, our results of operations and financial condition could be adversely affected. 49 Our financial statements are subject to the application of GAAP, which is also subject to varying interpretations over time.
If accounting standards change or if our estimates or assumptions relating to our critical accounting policies prove to be incorrect, our results of operations and financial condition could be adversely affected. Our financial statements are subject to the application of GAAP, which is also subject to varying interpretations over time.
We also cannot be certain that our insurance coverage will be adequate for data handling or data security liabilities actually incurred, that insurance will continue to be available to us on economically reasonable terms, or at all, or that any 30 insurer will not deny coverage as to any future claim.
We also cannot be certain that our insurance coverage will be adequate for data handling or data security liabilities actually incurred, that insurance will continue to be available to us on economically reasonable terms, or at all, or that any insurer will not deny coverage as to any future claim.
Federal or state regulators may also subject us to increased compliance, legal and operational costs, and could subject our business model to scrutiny and otherwise increase our regulatory requirements, which may require us to expend substantial resources, discontinue certain products, or adversely affect our ability to expand our business.
Federal or state regulators may also subject us to increased compliance, legal and operational 40 costs, and could subject our business model to scrutiny and otherwise increase our regulatory requirements, which may require us to expend substantial resources, discontinue certain products, or adversely affect our ability to expand our business.
Such laws and regulations include the Truth in Lending Act, Equal Credit Opportunity Act, Fair Credit Reporting Act, Restore Online Shoppers’ Confidence Act, the FTC’s Rule Concerning Recurring Subscriptions and Other Negative Option Programs, the Consumer Financial Protection Act, the Truth in Savings Act, Electronic Fund Transfer Act, Telephone Consumer Protection Act, Controlling the Assault of Non-Solicited Pornography And Marketing Act, Gramm-Leach-Bliley Act, the CFPB’s Payday, Vehicle Title, and Certain High-Cost Installment Loans Rule, Military Lending Act, Servicemembers Civil Relief Act, prohibitions against unfair, deceptive, and abusive acts and practices, regulations implementing the statutes described above and similar state and local laws and regulations, and other laws and regulations relating to consumer credit, fair lending and banking, overdraft services, funds availability, privacy and data protection, open banking and making available consumer financial data (including Section 1033 of the Consumer Financial Protection Act), artificial intelligence, sales and cancellation practices, terms and conditions in agreements for consumer financial products or services including unilateral changes by the provider, licensure and registration, and other topics.
Such laws and regulations include the Truth in Lending Act, Equal Credit Opportunity Act, Fair Credit Reporting Act, Restore Online Shoppers’ Confidence Act, the FTC’s Rule Concerning Recurring Subscriptions and Other Negative Option Programs, the Consumer Financial Protection Act, the Truth in Savings Act, Electronic Fund Transfer Act, Telephone Consumer Protection Act, Controlling the Assault of Non-Solicited Pornography And Marketing Act, Gramm-Leach-Bliley Act, the CFPB’s Payday, Vehicle Title, and Certain High-Cost Installment Loans Rule, Military Lending Act, Servicemembers Civil Relief Act, prohibitions against unfair, deceptive, and abusive acts and practices, regulations implementing the statutes described above and similar state and local laws and regulations, and other laws and regulations relating to consumer credit, fair lending and banking, overdraft services, funds availability, privacy and data protection, open banking and making available consumer financial data (including Section 1033 of the Consumer Financial Protection Act), AI, sales and cancellation practices, terms and conditions in agreements for consumer financial products or services including unilateral changes by the provider, licensure and registration, and other topics.
Any of these occurrences could result in our diminished ability to operate our business, potential liability to Members, inability to attract future Members, reputational damage, regulatory intervention, enforcement action and financial harm, which could negatively impact our business, financial condition and results of operations.
Any of these occurrences could result in our diminished ability to operate our business, potential liability to Members, inability to attract future Members, reputational damage, regulatory intervention, litigation, enforcement action and financial harm, which could negatively impact our business, financial condition and results of operations.
See “Cautionary Note Regarding Forward-Looking Statements.” 16 Unless otherwise noted or the context otherwise requires, the disclosures in this Item 1A refer to Dave Inc. and its consolidated subsidiaries following the consummation of the Business Combination.
See “Cautionary Note Regarding Forward-Looking Statements.” Unless otherwise noted or the context otherwise requires, the disclosures in this Item 1A refer to Dave Inc. and its consolidated subsidiaries following the consummation of the Business Combination.
Additionally, our use of third-party vendors is subject to increasingly demanding regulatory requirements and oversight by our regulators. Regulations require us to perform due diligence and ongoing monitoring of, and 33 exercise certain controls over, our third-party vendors and other ongoing third-party business relationships.
Additionally, our use of third-party vendors is subject to increasingly demanding regulatory requirements and oversight by our regulators. Regulations require us to perform due diligence and ongoing monitoring of, and exercise certain controls over, our third-party vendors and other ongoing third-party business relationships.
If we fail to adequately protect our proprietary rights, our competitive position could be impaired and we may lose valuable assets, generate less revenue and incur costly litigation to protect our rights. Our success is dependent, in part, upon protecting our proprietary technology and rights.
If we fail to adequately protect our proprietary rights, our competitive position could be impaired and we may lose valuable assets, generate less revenue and incur costly litigation to protect our rights. 33 Our success is dependent, in part, upon protecting our proprietary technology and rights.
If the pass-through insurance requirements are not satisfied due to operational failures by us or a third-party service provider, including our partner bank, there would be less deposit insurance coverage with respect to funds that we place on behalf of our Members at our partner bank; our Members could be harmed in the event of a failure of our bank partner; and we could be subject to enforcement actions, claims from third parties, including our consumers, and suffer economic harm that could have an adverse effect on our business.
If the pass-through insurance requirements are not satisfied due to operational failures by us or a third-party service provider, including our partner banks, there would be less deposit insurance coverage with respect to funds that we place on behalf of our Members at our partner banks; our Members could be harmed in the event of a failure of our bank partners; and we could be subject to enforcement actions, claims from third parties, including our consumers, and suffer economic harm that could have an adverse effect on our business.
For example, the recent bankruptcy of Synapse has affected the ability of customers of financial technology companies that used Synapse as a service provider to access funds placed at Synapse’s partner banks, including Evolve, for a number of months.
For example, the bankruptcy of Synapse has affected the ability of customers of financial technology companies that used Synapse as a service provider to access funds placed at Synapse’s partner banks, including Evolve, for a number of months.
Those changes are beyond our control but could adversely affect our results of operations and financial condition. Additionally, the preparation of our financial statements in conformity with GAAP requires estimates and assumptions that affect the amounts reported and disclosed in our financial statements.
Those changes are beyond our control but could adversely affect our results of operations and financial condition. 48 Additionally, the preparation of our financial statements in conformity with GAAP requires estimates and assumptions that affect the amounts reported and disclosed in our financial statements.
In addition, state licensing requirements may evolve over time, including, in particular, recent trends in legislation seeking to impose licensing requirements and regulation of parties engaged in the business of offering “earned wage access” products to consumers.
In addition, state 41 licensing requirements may evolve over time, including, in particular, recent trends in legislation seeking to impose licensing requirements and regulation of parties engaged in the business of offering “earned wage access” products to consumers.
Changes in the laws, regulations and enforcement priorities applicable to our business, or 39 changes in the way existing laws and regulations are interpreted and applied to us, could have a material impact on our business model, operations and financial position.
Changes in the laws, regulations and enforcement priorities applicable to our business, or changes in the way existing laws and regulations are interpreted and applied to us, could have a material impact on our business model, operations and financial position.
Our “terms of use” for the Dave App as well as the Evolve agreements related to the ExtraCash and deposit accounts include arbitration clauses, and any future bank partner agreements related to the ExtraCash and deposit accounts are also expected to include arbitration clauses.
Our “terms of use” for the Dave App as well as the Evolve and Coastal agreements related to the ExtraCash and deposit accounts include arbitration clauses, and any future bank partner agreements related to the ExtraCash and deposit accounts are also expected to include arbitration clauses.
We have been and may in the future also be subject to investigations and potential enforcement actions that may be brought by state regulatory authorities, state attorneys general or other state enforcement authorities and other governmental agencies.
We have been and may in the future also be subject to investigations and potential enforcement actions that may be brought by state regulatory authorities, state attorneys general or other state or local enforcement authorities and other governmental agencies.
These risks are discussed more fully below and include, but are not limited to, risks related to: • The industries in which we operate are highly competitive, which could adversely affect our results of operations. • ExtraCash exposes us to credit risk of our Members and if our underwriting criteria for ExtraCash is not sufficient to mitigate against this risk, or if the data we use to underwrite is inaccurate or incomplete, our financial condition and operating results could be adversely affected if a substantial number of our Members fail to repay the ExtraCash overdraft they receive. • If we are unable to keep pace with the rapid technological developments in our industry and the larger financial services industry necessary to continue providing our Members with new and innovative products and services, the use of our platform and other products and services could decline.
These risks are discussed more fully below and include, but are not limited to, risks related to: • The industries in which we operate are highly competitive, which could adversely affect our results of operations. • ExtraCash exposes us to credit risk of our Members and if our underwriting criteria for ExtraCash is not sufficient to mitigate against this risk, or if the data used to underwrite is inaccurate or incomplete, our 15 financial condition and operating results could be adversely affected if a substantial number of our Members fail to repay the ExtraCash overdraft they receive. • If we are unable to keep pace with the rapid technological and AI-related developments in our industry and the larger financial services industry necessary to continue providing our Members with new and innovative products and services, the use of our platform and other products and services could decline.
This case ultimately settled, with Elevate agreeing to charge rates only up to 24% and to refund consumers who were charged rates over what is allowed under Washington, DC law.
This case ultimately settled, with Elevate agreeing to 39 charge rates only up to 24% and to refund consumers who were charged rates over what is allowed under Washington, DC law.
A Member’s ability and willingness to repay their ExtraCash overdrafts can be negatively impacted by increases in their payment obligations to other lenders under 19 mortgage, credit card, and other loans.
A Member’s ability and willingness to repay their ExtraCash overdrafts can be negatively impacted by increases in their payment obligations to other lenders under mortgage, credit card, and other loans.
Transitioning Members’ accounts from one bank partner to another, including the anticipated transition from Evolve to Coastal Community Bank, raises the risk of financial losses as a result of operational errors, including but not limited to, loss or disclosure of Member data and records, software defects, service disruption, employee misconduct, security breaches, or other similar actions or errors as well as from disputes or negotiations with an existing or prospective bank partner.
Transitioning Members’ accounts from one bank partner to another, including the transition from Evolve to Coastal, raises the risk of financial losses as a result of operational errors, including but not limited to, loss or disclosure of Member data and records, software defects, service disruption, employee misconduct, security breaches, or other similar actions or errors as well as from disputes or negotiations with an existing or prospective bank partner.
Sustained or repeated system failures could reduce the attractiveness of our products and services, and result in Member attrition, thereby reducing operating revenue and harming our results of operations.
Sustained or repeated system failures could reduce the attractiveness of our products and services, and result in Member attrition, thereby reducing operating revenue 23 and harming our results of operations.
These initiatives and the uncertainty of the federal and state regulatory environments around bank partnership programs 41 may increase compliance and operational costs associated with our business or impact our relationships with our current partner bank or any future partner bank and mean that our efforts to launch products and services through bank partners may not ultimately be successful, or may be restricted or challenged by legislation or regulatory action.
These initiatives and the uncertainty of the federal and state regulatory environments around bank partnership programs may increase compliance and operational costs associated with our business or impact our relationships with our current partner banks or any future partner bank and mean that our efforts to launch products and services through bank partners may not ultimately be successful, or may be restricted or challenged by legislation or regulatory action.
If the legal structure underlying our relationship with our partner bank were to be successfully challenged or otherwise restricted, we would need to find an alternative bank relationship.
If the legal structure underlying our relationship with our partner banks were to be successfully challenged or otherwise restricted, we would need to find an alternative bank relationship.
Risks Relating to our Indebtedness 52 Servicing our debt requires a significant amount of cash, and we may not have sufficient cash flow from our business to pay our substantial debt.
Risks Relating to our Indebtedness Servicing our debt requires a significant amount of cash, and we may not have sufficient cash flow from our business to pay our substantial debt.
To the extent we change the pricing of our Dave Banking Product, we might find it more difficult to acquire new Members, to maintain or grow Dave banking debit card usage and to retain existing Members. As a result, our total operating revenues, operating results, prospects for future growth and overall business could be materially and adversely affected.
To the extent we change the pricing of our Dave banking products, we might find it more difficult to acquire new Members, to maintain or grow Dave banking debit card usage and to retain existing Members. As a result, our total operating revenues, operating results, prospects for future growth and overall business could be materially and adversely affected.
In addition, our agreements with certain partners and service providers may require us to notify them in the event of certain types of security breaches.
In addition, our agreements with certain partners and service 28 providers may require us to notify them in the event of certain types of security breaches.
For example, in the third quarter of 2024, the FDIC issued proposed rules that, if finalized as proposed, would (i) expand the scope of deposits that constitute “brokered deposits,” potentially limiting the ability of our bank partner to accept Members’ deposits without those deposits being considered brokered and therefore disincentivizing partnership with us; and (ii) establish new recordkeeping requirements for “custodial deposit accounts with transactional features,” potentially including deposit accounts offered to our Members by our bank partner, which could greatly increase our compliance and operational costs associated with the partnership.
For example, in 2024, the FDIC issued proposed rules that, if finalized as proposed, would (i) expand the scope of deposits that constitute “brokered deposits,” potentially limiting the ability of our bank partner to accept Members’ deposits without those deposits being considered brokered and therefore disincentivizing partnership with us; and (ii) establish new recordkeeping requirements for “custodial deposit accounts with transactional features,” potentially including deposit accounts offered to our Members by our bank partners, which could greatly increase our compliance and operational costs associated with the partnership.
In addition, data provided by third-party sources is a component of our credit decision making and this data may contain inaccuracies. This may result in the inability to either approve otherwise qualified applicants or rejected otherwise unqualified applicants through our platform or accurately analyze credit data, which may adversely impact our business and negatively impact our reputation.
In addition, data provided by third-party sources is a component of our credit decision making and this data may contain inaccuracies. This may result in the inability to either approve otherwise qualified applicants or reject otherwise unqualified applicants through our platform or accurately analyze credit data, which may adversely impact our business and negatively impact our reputation.
We have in the past and may in the future become subject to legal proceedings and claims that arise in the ordinary course of business, such as claims brought by our Members in connection with commercial disputes, employment claims made by our current or former employees, or claims for reimbursement following misappropriation of Member data.
We have in the past and may in the future become subject to legal proceedings and claims that arise in the ordinary course of business, such as claims brought by our Members, claims brought in connection with commercial disputes, employment claims made by our current or former employees, claims for reimbursement following misappropriation of Member data, or any other legal claims or disputes brought in connection with our business.
If we are unable to find a replacement financial institution to provide the services we receive from our bank partner, we would not be able to offer ExtraCash, service our deposit accounts, debit cards and other services, which would have a material adverse effect on our business, financial condition and results of operations.
If we are unable to find a replacement financial institution to provide the services we receive from our bank partners, we would not be able to offer ExtraCash, service our deposit accounts, debit cards and other services, which would have a material adverse effect on our business, financial condition and results of operations.
Information security risks in the financial services industry continue to increase generally, in part because of new technologies, the use of the Internet and telecommunications technologies (including mobile devices) to conduct financial and other business transactions and the increased sophistication and activities of organized criminals, perpetrators of fraud, hackers, terrorists and other malicious third parties.
Information security risks in the financial services industry continue to increase generally, in part because of new technologies (including the development of AI), the use of the Internet and telecommunications technologies (including mobile devices) to conduct financial and other business transactions and the increased sophistication and activities of organized criminals, perpetrators of fraud, hackers, terrorists and other malicious third parties.
These agreements and corresponding regulations and supervisory expectations governing banks and financial institutions may give Evolve or Coastal Community Bank substantial discretion in approving certain aspects of our business practices, including our application and qualification procedures for Members and require us to comply with certain legal requirements.
These agreements and corresponding regulations and supervisory expectations governing banks and financial institutions may give Evolve or Coastal substantial discretion in approving certain aspects of our business practices, including our application and qualification procedures for Members and require us to comply with certain legal requirements.
If the regulatory pass-through insurance requirements are satisfied, each of our Members’ interest in deposits that we place on their behalf at our partner bank is separately insured up to the statutory deposit insurance limit, currently $250,000 for deposits held in each deposit ownership category.
If the regulatory pass-through insurance requirements are satisfied, each of our Members’ interest in deposits that we place on their behalf at our partner banks is separately insured up to the statutory deposit insurance limit, currently $250,000 for deposits held in each deposit ownership category.
We may compete with others in the market who may in the future provide offerings similar to ours, particularly companies who may provide money management, lending and other services though a platform similar to our platform. These and other competitors in the banking and financial technology industries are introducing innovative products and services that may compete with ours.
We may compete with others in the market who may in the future provide offerings similar to ours, particularly companies who may provide money management, lending and other services through a platform similar to our platform. These and other competitors in the banking and financial technology industries are introducing innovative products and services that may compete with ours.
To address the challenges we face with respect to fraudulent activity of the nature outlined above and other fraudulent activities, we have implemented risk control mechanisms that have made it more difficult for all Members, including legitimate Members, to obtain and use our Dave Banking Product.
To address the challenges we face with respect to fraudulent activity of the nature outlined above and other fraudulent activities, we have implemented risk control mechanisms that have made it more difficult for all Members, including legitimate Members, to obtain and use our Dave banking products.
The ExtraCash product exposes us to financial losses if Members do not repay the ExtraCash overdraft. The timing and volume of repayments have a significant impact on our financial results and cash flows. If a large number of Members do not repay ExtraCash overdrafts, our financial condition and operating results would be adversely affected.
The ExtraCash product exposes us to financial losses if Members do not repay the ExtraCash overdraft. The timing and volume of settlements have a significant impact on our financial results and cash flows. If a large number of Members do not repay ExtraCash overdrafts, our financial condition and operating results would be adversely affected.
To date, our operations have been supported by primarily through cash receipts from services and transaction based revenues, equity financings, borrowings under the Debt Facility, issuances of 31 convertible notes and funds received as a result of the business combination.
To date, our operations have been supported primarily through cash receipts from services and transaction based revenues, equity financings, borrowings under the Debt Facility, issuances of convertible notes and funds received as a result of the business combination.
The performance of ExtraCash is significantly dependent on our ability to develop and deploy effective models, with oversight by our bank partner, to evaluate an applicant’s credit profile and likelihood of default based on a variety of factors and originate ExtraCash overdrafts.
The performance of ExtraCash is significantly dependent on our ability to develop and deploy effective models, with oversight by our bank partners, to evaluate an applicant’s credit profile and likelihood of default based on a variety of factors and originate ExtraCash overdrafts.
If the proposed rulemaking or a similar rulemaking is adopted, it may increase the operational costs and difficulty in placing our Member’s funds at our partner bank and could result in operating difficulties, liabilities and expenses that harm our business.
If the proposed rulemaking or a similar rulemaking is adopted, it may increase the operational costs and difficulty in placing our Member’s funds at our partner banks and could result in operating difficulties, liabilities and expenses that harm our business.
Our credit loss allowance is an estimate, and if actual repayment defaults are materially greater than our credit loss allowance, or more generally, if our forecasts are not accurate, our financial position, liquidity and results of operations could be materially adversely affected.
Our credit loss allowance is an estimate, and if actual settlement defaults are materially greater than our credit loss allowance, or more generally, if our forecasts are not accurate, our financial position, liquidity and results of operations could be materially adversely affected.
We believe it is likely that our risk control mechanisms may continue to adversely affect the growth of our Dave Banking Product for the foreseeable future and, as a result, negatively impact our operating revenues.
We believe it is likely that our risk control mechanisms may continue to adversely affect the growth of our Dave banking products for the foreseeable future and, as a result, negatively impact our operating revenues.
We expect interchange revenues from fees charged to merchants by card networks for processing a debit or credit payment to represent a significant percentage of our total operating revenues as adoption of our Dave Banking Product increases.
We expect interchange revenues from fees charged to merchants by card networks for processing a debit or credit payment to represent a significant percentage of our total operating revenues as adoption of our Dave banking products increases.
Furthermore, our financial results could be adversely affected if our costs associated with using our bank partner materially change or if any penalty or claim for damages is imposed as a result of our breach of our agreements with our bank partner.
Furthermore, our financial results could be adversely affected if our costs associated with using our bank partners materially change or if any penalty or claim for damages is imposed as a result of our breach of our agreements with our bank partners.
If this were to occur, it is possible that we would have to change our pricing strategies or reduce our prices, which could harm our revenue, gross profits, and operating results. Use of artificial intelligence in our operations and product offerings could result in reputational or competitive harm, legal or regulatory liability and adverse impacts on our results of operations.
If this were to occur, it is possible that we would have to change our pricing strategies or reduce our prices, which could harm our revenue, gross profits, and operating results. Use of AI in our operations and product offerings could result in reputational or competitive harm, legal or regulatory liability and adverse impacts on our results of operations.
The terms and conditions of products originated through a bank partner, including ExtraCash, are based on the overdraft lending authority of the bank partner, which is exempt under federal preemption law from certain state 40 consumer finance laws, and the non-applicability of certain state consumer finance laws including state licensing and usury restrictions.
The terms and conditions of products originated through a bank partner, including ExtraCash, are based on the overdraft origination authority of the bank partner, which is exempt under federal preemption law from certain state consumer finance laws, and the non-applicability of certain state consumer finance laws including state licensing and usury restrictions.
We also generate revenue by charging Members a fixed monthly rate for membership to our platform and from our Dave Banking Product through interchange and out-of-network ATM fees, as well as from our job portal service through referral fees from partner companies.
We also generate revenue by charging Members a fixed monthly rate for membership to our platform and from our Dave banking products through interchange and out-of-network ATM fees, as well as from our job portal service through referral fees from 19 partner companies.

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Item 2. Properties

Properties — owned and leased real estate

1 edited+1 added−1 removed0 unchanged
Biggest changeItem 2. Propert ies. We operate out of our headquarters in Los Angeles, California. We maintain two sublease agreements for approximately 9,000 square feet located in Los Angeles, California. The subleases for the Los Angeles spaces are scheduled to expire in December 2025 and October 2028, respectively. Item 3. Legal Pr oceedings.
Biggest changeItem 2. Propert ies. We operate out of our headquarters in Los Angeles, California. We maintain a sublease agreement for approximately 3,500 square feet of office space in Los Angeles. This sublease expires in October 2028. One sublease expired in December 2025; we renewed this sublease in the first quarter of 2026 for approximately 5,300 square feet.
Removed
See Note 12, ”Commitments and Contingencies,” to our consolidated financial statements included in this report for information regarding legal proceedings in which we are involved. Item 4. Mine Safety Disclosures. Not applicable. 55 PART II
Added
We believe our current facilities are adequate for our present needs and that suitable additional or substitute space will be available as needed to accommodate any future expansion of our operations.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

2 edited+8 added−1 removed3 unchanged
Biggest changeWe do not anticipate declaring any cash dividends to holders of our Dave Class A Common Stock in the foreseeable future. Sales of Unregistered Securities On January 29, 2024, the Company repurchased the $105.5 million outstanding balance of the convertible note as of December 31, 2023 for $71.0 million.
Biggest changeWe do not anticipate declaring any cash dividends to holders of our Dave Class A Common Stock in the foreseeable future. Sales of Unregistered Securities None.
Holders of Record As of December 31, 2024, there were 55 holders of record of Dave Class A common stock, one holder of record of our Class V common stock and 17 holders of record of the public warrants.
Holders of Record As of December 31, 2025, there were 30 holders of record of Dave Class A common stock, one holder of record of our Class V common stock and 10 holders of record of the public warrants.
Removed
Refer to Note 9 Convertible Note in the notes to our consolidated financial statements for the year ended December 31, 2024 contained in this Annual Report on Form 10-K. Issuer Purchases of Equity Securities None. Item 6. [Reserved] 56
Added
Issuer Purchases of Equity Securities Period (a) Total Number of Class A Shares Purchased (b) Average Price Paid per Class A Share (c) Total Number of Class A Shares Purchased as Part of Publicly Announced Plans or Programs (d) Maximum Dollar Value of Class A Shares that May Yet Be Purchased Under the Plans or Program (in millions)* March 1 – March 31, 2025 81,370 $ 84.69 81,370 $ 43.1 August 1 – August 31, 2025 132,155 $ 189.15 132,155 $ 18.1 November 1 – November 30, 2025 60,965 $ 194.20 60,965 $ 113.2 Total 274,490 274,490 * On March 7, 2025, the Board of Directors authorized a share repurchase program of up to $50.0 million (the "March Repurchase Plan").
Added
Through August 2025, we repurchased 213,525 shares of our Class A common stock for approximately $31.9 million under the March Repurchase Plan. On August 12, 2025, the Board authorized a new share repurchase program of up to $125.0 million, which replaced the March Repurchase Plan (the "August Repurchase Plan").
Added
During the fourth quarter of 2025, we repurchased an additional 60,965 shares of our Class A common stock for approximately $11.8 million. As of December 31, 2025, approximately $113.2 million remained available under the repurchase authorization. See Note 21, “Treasury Shares,” to the consolidated financial statements included elsewhere in this report.
Added
Dave Shareholder Return Performance Graph 55 The following graph compares the cumulative total return on our common stock with the cumulative total returns of the Russell 2000 Index and the S&P Software & Services Select Industry Index.
Added
The graph covers the period from January 6, 2022, the date our common stock commenced trading on The Nasdaq Global Market following the completion of our business combination, through December 31, 2025.
Added
The graph assumes an initial investment of $100 at the market close on January 6, 2022 in Dave Inc. common stock, the Russell 2000 Index, and the S&P Software & Services Select Industry Index, with reinvestment of all dividends. No cash dividends have been declared or paid on our common stock.
Added
The stock price performance shown in this graph is not necessarily indicative of future stock price performance.
Added
Index/Company 1/6/2022 12/30/2022 12/29/2023 12/31/2024 12/31/2025 Dave Inc. $ 100.00 $ 3.40 $ 3.07 $ 31.84 $ 81.11 Russell 2000 Index $ 100.00 $ 80.96 $ 94.67 $ 105.59 $ 119.11 S&P Software & Services Select Industry Index $ 100.00 $ 69.46 $ 96.26 $ 120.79 $ 119.60 Item 6. [Reserved] 56

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeThe increase of $4.9 million, or 7%, was primarily attributable to the following: • an increase in legal fees of $3.5 million primarily due to ongoing litigation, settlement, compliance, employment and general corporate related matters; • an increase in depreciation and amortization of $2.1 million, primarily due to increased internally developed capitalized costs, and depreciation related to leasehold improvements and equipment purchases; • an increase in certain expenses related to our checking product of $1.8 million, primarily attributable to processing fees, card fees and fraud related costs associated with the growth in Members and the number of transactions processed; and • an increase in technology & infrastructure expenses of $0.5 million, primarily due to increased costs to support the growth of our business and development of new products and features; offset by a 63 • a decrease in insurance related costs of $1.1 million, primarily related to reductions in director and officer insurance premiums; • a decrease in charitable contribution expenses of $0.9 million, primarily due to decreased amounts pledged to charitable meal donations related to Members' tips; and • a decrease in administrative expenses of $1.1 million, primarily due to reductions in investor and public relations fees, accounting related fees, bank service charges and other administrative expenses.
Biggest changeThe increase of $2.0 million, or 6%, was primarily attributable to the following: • an increase in legal fees of $3.5 million primarily due to ongoing litigation, settlement, compliance, employment and general corporate related matters; • an increase in depreciation and amortization of $2.1 million, primarily due to increased internally developed capitalized costs, and depreciation related to leasehold improvements and equipment purchases; • an increase in administrative expenses of $0.2 million, primarily due to higher sales tax expense; offset by • a decrease in contractor and consulting fees of $1.8 million due to the average increase in employee headcount and corresponding reduction in external support for IT security, finance, marketing, design and customer service resources; • a decrease in insurance related costs of $1.1 million, primarily related to reductions in director and officer insurance premiums; and • a decrease in charitable contribution expenses of $0.9 million, primarily due to decreased amounts pledged to charitable meal donations related to Members' tips.
Other (income) expense For the Year Ended Change (in thousands, except for percentages) December 31, $ % 2024 2023 2024/2023 2024/2023 Interest income $ (2,984 ) $ (5,295 ) $ 2,311 -44 % Interest expense 7,989 11,774 (3,785 ) -32 % Gain on extinguishment of convertible debt (33,442 ) - (33,442 ) -100 % Changes in fair value of earnout liabilities 965 (22 ) 987 -4486 % Changes in fair value of public and private warrant liabilities 1,729 (260 ) 1,989 -765 % Total $ (25,743 ) $ 6,197 $ (31,940 ) -515 % Interest income — Interest income totaled $3.0 million for the year ended December 31, 2024, compared to $5.3 million for the year ended December 31, 2023.
Other (income) expense 68 For the Year Ended Change (in thousands, except for percentages) December 31, $ % 2024 2023 2024/2023 2024/2023 Interest income $ (2,984 ) $ (5,295 ) $ 2,311 -44 % Interest expense 7,989 11,774 (3,785 ) -32 % Gain on extinguishment of convertible debt (33,442 ) - (33,442 ) -100 % Changes in fair value of earnout liabilities 965 (22 ) 987 -4486 % Changes in fair value of public and private warrant liabilities 1,729 (260 ) 1,989 -765 % Total $ (25,743 ) $ 6,197 $ (31,940 ) -515 % Interest income — Interest income totaled $3.0 million for the year ended December 31, 2024, compared to $5.3 million for the year ended December 31, 2023.
Cash Flows From Financing Activities During the year ended December 31, 2024, net cash used in financing activities was $71.0 million, which primarily consisted of the $72.3 million paydown of the convertible note with FTX Ventures Ltd. and associated costs, offset by $1.3 million in proceeds from the issuance of common stock for stock option exercises.
During the year ended December 31, 2024, net cash used in financing activities was $71.0 million, which primarily consisted of the $72.3 million paydown of the convertible note with FTX Ventures Ltd. and associated costs, offset by $1.3 million in proceeds from the issuance of common stock for stock option exercises.
Our computation of Adjusted EBITDA may not be comparable to other similarly titled measures computed by other companies, because all companies may not calculate Adjusted EBITDA in the same fashion. Because of these limitations, Adjusted EBITDA should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP.
Our computation of Adjusted EBITDA (loss) may not be comparable to other similarly titled measures computed by other companies, because not all companies calculate Adjusted EBITDA (loss) in the same fashion. Because of these limitations, Adjusted EBITDA (loss) should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP.
Changes to the allowance have a direct impact on the provision for credit losses in the consolidated statement 59 of operations. We consider ExtraCash receivables, aged more than 120 days or which become uncollectible based on information available to us as impaired.
Changes to the allowance have a direct impact on the provision for credit losses in the consolidated statement of operations. We consider ExtraCash receivables aged more than 120 days or which become uncollectible based on information available to us as impaired.
We believe that the use of Adjusted EBITDA provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing our financial measures with those of comparable companies, which may present similar non-GAAP financial measures to investors.
We believe that the use of Adjusted EBITDA (loss) provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing our financial measures with those of comparable companies, which may present similar non-GAAP financial measures to investors.
Processing and Servicing Costs Processing and servicing fees consist of fees paid to our processing partners for the recovery of ExtraCash, optional tips, optional express processing fees, overdraft service fees and subscriptions. These expenses also include fees paid for services to connect Members’ bank accounts to our application.
Processing and servicing costs Processing and servicing costs consist of fees paid to our processing partners for the recovery of ExtraCash, optional processing fees, optional tips, overdraft service fees and subscriptions. These expenses also include costs paid for services to connect Members’ bank accounts to our application.
Historical loss and collections rates utilized in the calculation of the provision for credit losses improved slightly as compared to historical rates due to continued improvement in historical collections performance. Any changes to our historical loss and collections experience directly affect the historical loss rates utilized in the calculation of the 62 allowance for credit losses.
Historical loss and collections rates utilized in the calculation of the provision for credit losses improved slightly as compared to historical rates due to continued improvement in historical collections performance. Any changes to our historical loss and collections experience directly affect the historical loss rates utilized in the calculation of the allowance for credit losses.
Changes in fair value of earnout liability —Changes in fair value of earnout liabilities totaled an expense of $1.0 million for the year ended December 31, 2024, compared to a benefit of $0.02 million for the year ended December 31, 2024.
Changes in fair value of earnout liability —Changes in fair value of earnout liabilities totaled an expense of $1.0 million for the year ended December 31, 2024, compared to a benefit of $0.02 million for the year ended December 31, 2023.
We believe that the accounting estimates discussed below are critical to understanding our historical and future performance, as these estimates relate to the more significant areas involving management’s judgments and estimates. Please refer to Note 2 in our accompanying consolidated financial statements for the years ended December 31, 2024 and 2023 included in this Annual Report on Form 10-K.
We believe that the accounting estimates discussed below are critical to understanding our historical and future performance, as these estimates relate to the more significant areas involving management’s judgments and estimates. Please refer to Note 2 in our accompanying consolidated financial statements for the years ended December 31, 2025 and 2024 included in this Annual Report on Form 10-K.
The increase was primarily attributable to interchange revenue earned from the growth in Members engaging with our Checking Product and card spend of $1.9 billion for the year ended December 31, 2024, an increase of 40%, from $1.4 billion for the year ended December 31, 2023, in addition to increases in fees earned from Members' funding and withdrawal-related transactions, offset by an increase of $1.2 million in interest due to Members.
The increase was primarily attributable to interchange revenue earned from the growth in Members engaging with our Checking Products and card spend of $1.9 billion for the year ended December 31, 2024, an increase of 40%, from $1.4 billion for the year ended December 31, 2023, in addition to increases in fees earned from Members' funding and withdrawal-related transactions, offset by an increase of $1.2 million in interest due to Members.
In assessing such adjustments, we primarily evaluate current economic conditions, expectations of near-term economic trends and changes in customer payment terms and collection trends.
In assessing such adjustments, we primarily 74 evaluate current economic conditions, expectations of near-term economic trends and changes in customer payment terms and collection trends.
During the year ended December 31, 2023, net cash provided by financing activities was $0.02 million, which primarily consisted of payments of $0.01 million for fractional shares that resulted from our reserve stock spilt and $0.03 million in proceeds from the issuance of common stock for stock option exercises.
During the year ended December 31, 2023, net cash provided by financing activities was $0.02 million, which primarily consisted of payments of $0.01 million for fractional shares that resulted from our reverse stock spilt and $0.03 million in proceeds from the issuance of common stock for stock option exercises.
Operating expenses We classify our operating expenses into the following five categories: Provision for Credit Losses The provision for credit losses primarily consists of an allowance for expected credit losses at a level estimated to be adequate to absorb credit losses inherent in the outstanding ExtraCash receivables, inclusive of outstanding processing fees and tips along with outstanding amounts aged over 120 days or which become uncollectible based on information available to us during the period.
Operating Expenses We classify our operating expenses into the following six categories: Provision for credit losses The provision for credit losses primarily consists of an allowance for expected credit losses at a level estimated to be adequate to absorb credit losses inherent in the outstanding ExtraCash receivables, inclusive of outstanding processing and overdraft service fees and tips, along with outstanding amounts aged over 120 days or which become uncollectible based on information available to us during the period.
The increase of $1.5 million, or 5%, was primarily driven by an increase in process transaction volume year over year, offset by technology enhancements made to our ExtraCash payments structure along with discounts and cost savings due to rebates and price reductions from our processors.
The increase of $1.2 million, or 4%, was primarily driven by an increase in process transaction volume year over year, offset by technology enhancements made to our ExtraCash payments structure along with discounts and cost savings due to rebates and price reductions from our processors.
We have estimated $2.0 million and $1.3 million of uncertain tax positions as of December 31, 2024 and 2023, respectively, related to state income taxes and federal and state research and development tax credits. We are subject to income tax in jurisdictions in which we operate, including the United States.
We have estimated $3.3 million and $2.0 million of uncertain tax positions as of December 31, 2025 and 2024, respectively, related to state income taxes and federal and state research and development tax credits. We are subject to income tax in jurisdictions in which we operate, including the United States.
The decrease of $3.5 million, or 7%, was primarily attributable to reductions in our non-media marketing spend including our brand refresh, efficiencies achieved by partnering with new marketing agencies, and optimizing our promotion strategy. We also improved the efficiency of our media investment by reallocating marketing spend to more efficient channels via improved measurement, tracking and attribution.
The decrease of $3.2 million, or 6%, was primarily attributable to reductions in our non-media marketing spend including our brand refresh, efficiencies achieved by partnering with new marketing agencies, and optimizing our promotion strategy. We also improved the efficiency of our media investment by reallocating marketing spend to more efficient channels via improved measurement, tracking and attribution.
The increase was primarily attributable to the repurchase of the $105.7 million outstanding balance of the convertible note with FTX Ventures Ltd. for $71.0 million in January 2024. The gain was reduced by unamortized debt issuance costs of $0.03 million at the extinguishment date and third-party costs totaling $1.3 million in conjunction with the settlement of the convertible note.
The decrease was attributable to the repurchase of the $105.7 million outstanding balance of the convertible note with FTX Ventures Ltd. for $71.0 million in January 2024. The gain was reduced by unamortized debt issuance costs of $0.03 million at 64 the extinguishment date and third-party costs totaling $1.3 million in conjunction with the settlement of the convertible note.
However, you should be aware that, when evaluating Adjusted EBITDA, we may incur future expenses similar to those excluded when calculating these measures. In addition, our presentation of these measures should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items.
However, you should be aware that when evaluating Adjusted EBITDA (loss), we may incur future expenses similar to those excluded when calculating this measure. In addition, our presentation of this measure should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items.
We reported cash flows provided by operating activities of $125.1 million for the year ended December 31, 2024 and cash flows provided by operating activities of $33.8 million for the year ended December 31, 2023.
We reported cash flows provided by operating activities of $290.0 million for the year ended December 31, 2025, cash flows provided by operating activities of $125.1 million for the year ended December 31, 2024 and cash flows provided by operating activities of $33.8 million for the year ended December 31, 2023.
Provision for income taxes 64 For the Year Ended Change (in thousands, except for percentages) December 31, $ % 2024 2023 2024/2023 2024/2023 Provision for income taxes 2,481 120 2,361 1968 % Total $ 2,481 $ 120 $ 2,361 1968 % Provision for income taxes for the year ended December 31, 2024 increased by approximately $2.4 million compared to the year ended December 31, 2023.
Provision for income taxes For the Year Ended Change (in thousands, except for percentages) December 31, $ % 2024 2023 2024/2023 2024/2023 Provision for income taxes 2,481 120 2,361 1968 % Total $ 2,481 $ 120 $ 2,361 1968 % Provision for income taxes for the year ended December 31, 2024 increased by approximately $2.4 million, or 1,968%, compared to the year ended December 31, 2023.
Provision for income taxes Provision for income taxes consists of the federal and state corporate income taxes accrued on income resulting from the sale of our services. 60 Results of Operations Comparison of the Years Ended December 31, 2024 and 2023 Operating revenues For the Year Ended Change (in thousands, except for percentages) December 31, $ % 2024 2023 2024/2023 2024/2023 Service based revenue, net Processing fees, net $ 218,802 $ 152,490 $ 66,312 43 % Tips 67,563 56,945 10,618 19 % Subscriptions 24,599 21,483 3,116 15 % Other 462 1,323 (861 ) -65 % Transaction based revenue, net 35,650 26,852 8,798 33 % Total $ 347,076 $ 259,093 $ 87,983 34 % Service based revenue, net— Processing fees, net Processing fees, net of processor costs associated with ExtraCash originations, for the year ended December 31, 2024 were $218.8 million, an increase of $66.3 million, or 43%, from $152.5 million for the year ended December 31, 2023.
Comparison of the Years Ended December 31, 2024 and 2023 Operating revenues For the Year Ended Change (in thousands, except for percentages) December 31, $ % 2024 2023 2024/2023 2024/2023 Service based revenue, net Processing and service fees, net $ 218,802 $ 152,490 $ 66,312 43 % Tips 67,563 56,945 10,618 19 % Subscriptions 24,599 21,483 3,116 15 % Other 462 1,323 (861 ) -65 % Transaction based revenue, net 35,650 26,852 8,798 33 % Total $ 347,076 $ 259,093 $ 87,983 34 % Service based revenue, net— Processing fees, net 65 Processing fees, net of processor costs associated with ExtraCash originations, for the year ended December 31, 2024 were $218.8 million, an increase of $66.3 million, or 43%, from $152.5 million for the year ended December 31, 2023.
Cash Flows Summary (in thousands) For the Year Ended December 31, Total cash provided by (used in): 2024 2023 Operating activities $ 125,137 $ 33,754 Investing activities (45,843 ) (14,375 ) Financing activities (70,995 ) 22 Net increase in cash and cash equivalents and restricted cash $ 8,299 $ 19,401 Cash Flows From Operating Activities We recorded net income of $57.9 million for the year ended December 31, 2024, and a net loss of $48.5 million for the year ended December 31, 2023.
Cash Flows Summary 72 (in thousands) For the Years Ended December 31, Total cash provided by (used in): 2025 2024 2023 Operating activities $ 290,023 $ 125,137 $ 33,754 Investing activities (202,748 ) (45,843 ) (14,375 ) Financing activities (56,288 ) (70,995 ) 22 Net increase in cash and cash equivalents and restricted cash $ 30,987 $ 8,299 $ 19,401 Cash Flows From Operating Activities We recorded net income of $195.9 million for the year ended December 31, 2025, net income of $57.9 million for the year ended December 31, 2024 and a net loss of $48.5 million for the year ended December 31, 2023.
These changes were offset primarily by a decrease in prepaid income taxes of 0.7 million, a decrease in prepaid expenses and other current assets of $3.3 million and an increase in accrued expenses of $1.7 million. Cash Flows From Investing Activities During the year ended December 31, 2024, net cash used in investing activities was $45.8 million.
These uses were partially offset by a decrease in prepaid income taxes of $0.7 million, a decrease in prepaid expenses and other current assets of $3.3 million, and an increase in accrued expenses of $1.7 million. Cash Flows From Investing Activities During the year ended December 31, 2025, net cash used in investing activities was $202.7 million.
Excluding non-cash impacts, changes in cash flows from operations included an increase in receivables related to revenue from ExtraCash receivables of $4.1 million, a decrease in accounts payable of $5.9 million, a decrease in legal settlement accrual of $6.1 million, and a decrease in other current liabilities of $0.5 million.
Excluding non-cash items, changes in operating assets and liabilities included net uses of cash from an increase in receivables related to revenue from ExtraCash of $4.1 million, a decrease in accounts payable of $5.9 million, a decrease in legal settlement accrual of $6.1 million, and a decrease in other current liabilities of $0.5 million.
Other operating expenses —Other operating expenses totaled $75.5 million for the year ended December 31, 2024, compared to $70.7 million for the year ended December 31, 2023.
Other operating expenses —Other operating expenses totaled $33.5 million for the year ended December 31, 2024, compared to $31.5 million for the year ended December 31, 2023.
Processing and service costs —Processing and servicing costs totaled $30.4 million for the year ended December 31, 2024, compared to $28.9 million for the year ended December 31, 2023.
Processing and servicing costs —Processing and servicing costs totaled $29.4 million for the year ended December 31, 2024, compared to $28.1 million for the year ended December 31, 2023.
We believe that the non-GAAP financial information may be helpful in assessing our operating performance and facilitates an alternative comparison among fiscal periods. The non-GAAP financial measure is not, and should not be viewed as, a substitute for GAAP reporting measures.
We use the following non-GAAP measure to evaluate our ongoing operations and for internal planning and forecasting purposes. We believe that the non-GAAP financial information may be helpful in assessing our operating performance and facilitates an alternative comparison among fiscal periods. The non-GAAP financial measure is not, and should not be viewed as, a substitute for GAAP reporting measures.
Subsequent recoveries, if any, of Member ExtraCash receivables, written-off are recorded as a reduction to ExtraCash receivables, resulting in a reduction to the allowance for credit losses and a corresponding reduction to the provision for credit losses in the consolidated statements of operations when collected.
All impaired ExtraCash receivables are deemed uncollectible and subsequently written off and are a direct reduction to the allowance for credit losses. Subsequent recoveries, if any, of ExtraCash receivables written-off are recorded as a reduction to the provision for credit losses in the consolidated statements of operations when collected.
The increase of $12.1 million, or 13%, was primarily attributable to the following: • an increase in stock-based compensation of $10.7 million, primarily due to the vesting of certain performance-based restricted stock units during the year ended December 31, 2024 compared to the year ended December 31, 2023, offset by a reduction in stock-based compensation expense related to stock options granted in prior years that have fully vested; • an increase in payroll and related costs of $1.8 million, primarily due to average headcount and salary increases and bonuses; offset by • a decrease in contractor and consulting fees of $0.4 million due to the average increase in employee headcount and corresponding reduction in external support for IT security, finance, marketing, design and customer service resources.
The increase of $12.5 million, or 13%, was primarily attributable to the following: • an increase in stock-based compensation of $10.7 million, primarily due to the vesting of certain performance-based restricted stock units during the year ended December 31, 2024 compared to the year ended December 31, 2023, offset by a reduction in stock-based compensation expense related to stock options granted in prior years that have fully vested; and • an increase in payroll and related costs of $1.8 million, primarily due to average headcount and salary increases and bonuses.
We have provided Members with more than $15 billion in ExtraCash, offering critical liquidity when they need it most. To further support our communities, we have donated approximately $23 million to charity and important causes since inception. Customers value our products, as demonstrated by more than 700,000 App Store reviews with an average 4.8-star rating as of February 2025.
We have provided Members with over $22 billion in ExtraCash, offering critical liquidity when they need it most, and have donated over $25 million to charity and important causes. Customers value our products, as demonstrated by more than 750,000 App Store reviews with an average 4.8-star rating.
Subscriptions Subscriptions for the year ended December 31, 2024 were $24.6 million, an increase of $3.1 million, or 15%, from $21.5 million for the year ended December 31, 2023.
Subscriptions Subscriptions for the year ended December 31, 2024 were $24.6 million, an increase of $3.1 million, or 15%, from $21.5 million for the year ended December 31, 2023. The increase was primarily attributable to an increase in paying Members on our platform.
We may use cash to acquire businesses and technologies. The nature of these potential transactions, however, makes it difficult to predict the amount and timing of such cash requirements.
We will continue to evaluate and disclose the nature and impact of this arrangement as the transition progresses. Additionally, we may use cash to acquire businesses and technologies. The nature of these potential transactions, however, makes it difficult to predict the amount and timing of such cash requirements.
For U.S. income tax purposes, we are taxed as a Subchapter C corporation. We recognize deferred taxes for temporary differences between the basis of assets and liabilities for financial statement and income tax purposes. We recorded a valuation allowance against our deferred tax assets, net of deferred tax liabilities, at December 31, 2024 and December 31, 2023.
For U.S. income tax purposes, we are taxed as a Subchapter C corporation. We recognize deferred taxes for temporary differences between the basis of assets and liabilities for financial statement and income tax purposes. The Company regularly assesses the need for a valuation allowance against its deferred tax assets each quarter.
The increase was primarily attributable to an increase in paying Members on our platform. 61 Other Other revenue for the year ended December 31, 2024 was $0.5 million, a decrease of $0.9 million, or 65% from $1.3 million for the year ended December 31, 2023.
Other Other revenue for the year ended December 31, 2024 was $0.5 million, a decrease of $0.9 million, or 65% from $1.3 million for the year ended December 31, 2023. The decrease was primarily attributable to lower revenues resulting from the elimination of our Legacy Rewards product in 2023.
Compensation and benefits —Compensation and benefits expenses totaled $107.0 million for the year ended December 31, 2024, compared to $94.9 million for the year ended December 31, 2023.
Compensation and benefits —Compensation and benefits expenses totaled $105.8 million for the year ended December 31, 2024, compared to $93.3 million for the year ended December 31, 2023.
The decrease was primarily attributable to lower revenues resulting from the elimination of our Legacy Rewards product in 2023. Transaction based revenue, net Transaction based revenue, net for the year ended December 31, 2024 was $35.7 million, an increase of $8.8 million, or 33%, from $26.9 million, for the year ended December 31, 2023.
Transaction based revenue, net Transaction based revenue, net for the year ended December 31, 2024 was $35.7 million, an increase of $8.8 million, or 33%, from $26.9 million, for the year ended December 31, 2023.
Based upon management’s assessment of all available evidence, we have concluded that it is more-likely-than-not that the deferred tax assets, net of deferred tax liabilities, will not be realized.
We recorded a valuation allowance against our deferred tax assets, net of deferred tax liabilities, at December 31, 2024. Based upon management’s assessment of all available evidence at December 31, 2024, we concluded that it was more-likely-than-not that the deferred tax assets, net of deferred tax liabilities, will not be realized.
The reconciliation of net income (loss) to Adjusted EBITDA below should be reviewed, and no single financial measure should be relied upon to evaluate our business. 65 The following table reconciles net income (loss) to Adjusted EBITDA for the years ended December 31, 2024 and 2023: For the Year Ended (in thousands) December 31, 2024 2023 Net income (loss) $ 57,873 $ (48,517 ) Interest expense, net 5,005 6,479 Provision for income taxes 2,481 120 Depreciation and amortization 7,540 5,450 Stock-based compensation 37,327 26,674 Legal settlement and litigation accrual 7,000 - Gain on extinguishment of convertible debt (33,442 ) - Changes in fair value of earnout liabilities 965 (22 ) Changes in fair value of public and private warrant liabilities 1,729 (260 ) Adjusted EBITDA (loss) $ 86,478 $ (10,076 ) Liquidity and Capital Resources In the past, we have financed our operations primarily from cash receipts from service and transaction-based revenues, equity financings, borrowings under the Debt Facility, issuances of convertible notes and funds received as a result of the business combination.
The following table reconciles net income (loss) to Adjusted EBITDA (loss) for the years ended December 31, 2025, 2024 and 2023: For the Year Ended (in thousands) December 31, 2025 2024 2023 Net income (loss) $ 195,865 $ 57,873 $ (48,517 ) Interest expense, net 5,447 5,005 6,479 Provision (benefit) for income taxes (27,838 ) 2,481 120 Depreciation and amortization 6,975 7,540 5,450 Stock-based compensation 29,896 37,327 26,674 Discretionary income (1,300 ) - - Legal settlement and litigation expenses 4,500 7,000 - Gain on extinguishment of convertible debt - (33,442 ) - Changes in fair value of earnout liabilities 3,285 965 (22 ) Changes in fair value of public and private warrant liabilities 9,864 1,729 (260 ) Adjusted EBITDA (loss) $ 226,694 $ 86,478 $ (10,076 ) Liquidity and Capital Resources We have historically financed our operations through cash generated from operations, equity financings, borrowings under our credit facility, and proceeds from the Business Combination.
Advertising and marketing —Advertising and marketing expenses totaled $44.9 million for the year ended December 31, 2024, compared to $48.4 million for the year ended December 31, 2023.
Advertising and activation costs —Advertising and activation costs totaled $53.4 million for the year ended December 31, 2024, compared to $56.7 million for the year ended December 31, 2023.
While our significant accounting estimates are described in the notes to our consolidated financial statements, we believe that the following accounting estimates require a greater degree of judgment and complexity and are the most critical to understanding our financial condition and historical and future results of operations. 68 Allowance for Credit Losses ExtraCash receivables from contracts with Members as of the balance sheet dates are recorded at their original receivable amounts reduced by an allowance for expected credit losses.
While our significant accounting estimates are described in the notes to our consolidated financial statements, we believe that the following accounting estimates require a greater degree of judgment and complexity and are the most critical to understanding our financial condition and historical and future results of operations.
Transaction based revenue, net Transaction based revenue, net primarily consists of interchange and ATM revenues from our Checking Product, net of interchange and ATM-related fees, fees earned from funding and withdrawal-related transactions, volume support from a certain co-branded agreement, fees earned related to the Rewards Product for Members who make debit card spending transactions at participating merchants and deposit referral fees and are recognized at the point in time the transactions occur, as the performance obligations are satisfied and the variable consideration is not constrained.
Also included in transaction based revenue are fees earned from funding and withdrawal-related transactions, maintenance fees on inactive accounts, volume support from a certain co-branded agreement and deposit referral fees that are recognized at the point in time the transactions occur, as the performance obligations are satisfied and the variable consideration is not constrained.
This increase was primarily due to a significant increase in income for the year ended December 31, 2024 compared to the year ended December 31, 2023, including a nonrecurring gain on extinguishment of convertible debt of $33.4 million.
This increase was primarily due to a significant increase in income for the year ended December 31, 2024 compared to the year ended December 31, 2023, including a non-recurring gain on extinguishment of convertible debt of $33.4 million. 69 Non-GAAP Financial Measures In addition to our results determined in accordance with GAAP, we believe the following non-GAAP measure is useful in evaluating our operational performance.
Costs associated with technology and infrastructure (third-party SaaS), depreciation and amortization of property and equipment and intangible assets, legal fees, rent, office related expenses, public relations costs, professional services fees, travel and entertainment, and insurance vary based upon our investment in infrastructure, business development, risk management and internal controls and are generally not correlated with our operating revenues or other transaction metrics.
Other Operating Expenses Other operating expenses primarily include charitable commitments, depreciation and amortization of property and equipment and intangible assets, legal fees and settlements, rent, sales tax-related costs, office expenses, public relations, professional services, travel and entertainment, and insurance. These costs generally reflect our investments in infrastructure, business development, risk management, and internal controls.
Net cash provided by operating activities for the year ended December 31, 2024 included net income of $57.9 million, and excluding non-cash impacts, included an increase in prepaid expenses and other current assets of $8.2 million and an increase in receivables related to revenue from ExtraCash of $6.2 million.
Excluding non-cash items, changes in operating assets and liabilities were a net use of cash, driven by an increase in prepaid expenses and other current assets of $8.2 million and an increase in receivables related to revenue from ExtraCash of $6.2 million.
During the year ended December 31, 2024, cash provided by operating activities increased compared to the year ended December 31, 2023 due to decreases in the provision for credit losses, processing costs, marketing and compensation and benefits across the organization.
During the year ended December 31, 2023, net cash provided by operating activities was $33.8 million, an increase compared to the year ended December 31, 2022, primarily driven by improved operating results, including a lower net loss, reduced provision for credit losses, and decreases in processing costs, marketing expenses, and compensation and benefits.
Service based revenue, net also consists of lead generation fees from our Side Hustle advertising partners and revenue share from our surveys partner.
Operating Revenues Service based revenue, net Service based revenue, net primarily consists of processing fees, optional tips, overdraft service fees and subscriptions charged to Members, net of processor-related costs associated with ExtraCash disbursements. Service based revenue, net also consists of lead generation fees from our Side Hustle advertising partners and revenue share from our surveys partner.
Except for processing and servicing fees associated with ExtraCash originations which are recorded net against revenue, all other processing and service fees are expensed as incurred. Advertising and Marketing Advertising and marketing expenses consist primarily of fees we pay to our advertising and marketing platform partners.
Except for processing and servicing costs associated with ExtraCash originations which are recorded net against revenue, all other processing and service costs are expensed as incurred. Financial network and transaction costs Financial network and transaction costs primarily consist of program management fees, card network association fees, payment processing costs, losses related to Member-disputed transactions, bank card fees and fraud-related losses.
Adjusted EBITDA “Adjusted EBITDA” is defined as net income (loss) adjusted for interest expense, net, provision for income taxes, depreciation and amortization, stock-based compensation and other discretionary items determined by management. Adjusted EBITDA is intended as a supplemental measure of our performance that is neither required by, nor presented in accordance with, GAAP.
Adjusted EBITDA (loss) is intended as a supplemental measure of our performance that is neither required by, nor presented in accordance with, GAAP.
These changes were offset by an increase in accrued expenses of $4.1 million, an increase in legal settlement accrual of $3.8 million, an increase in non-current liabilities of $2.9 million, an increase in accounts payable of $1.3 million, an increase in other current liabilities of $0.3 million and a decrease in prepaid income taxes of $0.1 million. 67 During the year ended December 31, 2023, cash provided by operating activities increased compared to the year ended December 31, 2022 due to decreases in the provision for credit losses, processing costs, marketing and compensation and benefits across the organization.
These uses were partially offset by an increase in accrued expenses of $4.1 million, an increase in legal settlement accrual of $3.8 million, an increase in non-current liabilities of $2.9 million, an increase in accounts payable of $1.3 million, an increase in other current liabilities of $0.3 million, and a decrease in prepaid income taxes of $0.1 million.
Comparability of Financial Information Our future results of operations and financial position may not be comparable to historical results as a result of the consummation of the Business Combination.
By leveraging technology and AI, we have dramatically reduced our cost to serve, enabling us to provide banking and credit products at lower costs with a stronger value proposition. Comparability of Financial Information Our future results of operations and financial position may not be comparable to historical results as a result of the consummation of the Business Combination.
Other (income) expenses Other (income) expenses consist of interest income, interest expense, gain on extinguishment of convertible debt, earnout liabilities fair value adjustments and changes in fair value of warrant liabilities.
As such, they may fluctuate based on strategic priorities and are not always directly correlated with revenue or transaction volume. Other (Income) Expenses Other (income) expenses consist of interest income, interest expense, gain on extinguishment of debt, changes in fair value of earnout liabilities and changes in fair value of warrant liabilities.
We compensate for these limitations by relying primarily on our GAAP results and using Adjusted EBITDA on a supplemental basis.
We compensate for these limitations by relying primarily on our GAAP results and using Adjusted EBITDA (loss) on a supplemental basis. You should review the reconciliation of net income to Adjusted EBITDA (loss) below, and no single financial measure should be relied upon to evaluate our business.
Key Factors Affecting Operating Results Our future operating results and cash flows are dependent upon a number of opportunities, challenges and other factors, including Member growth and activity, product expansion, competition, industry trends and general economic conditions.
Key Factors Affecting Operating Results Our future operating results and cash flows depend on Member growth and activity, product expansion, competition, industry trends, and general economic conditions. Member Acquisition and Engagement Revenue growth depends on efficiently acquiring new Members and driving product cross-sell.
The amount and timing of our future funding requirements, if any, will depend on many factors, including the pace and results of our product development efforts. No assurances can be provided that additional funding will be available at terms acceptable to us, if at all.
The amount and timing of any future funding requirements will depend on many factors, including operating performance, growth initiatives, and market conditions. We may from time to time seek to raise additional capital through equity or debt financings. There can be no assurance that additional financing will be available on terms acceptable to us, or at all.
Operating expenses For the Year Ended Change (in thousands, except for percentages) December 31, $ % 2024 2023 2024/2023 2024/2023 Provision for credit losses $ 54,626 $ 58,386 $ (3,760 ) -6 % Processing and servicing costs 30,377 28,926 1,451 5 % Advertising and marketing 44,904 48,392 (3,488 ) -7 % Compensation and benefits 107,028 94,910 12,118 13 % Other operating expenses 75,530 70,679 4,851 7 % Total $ 312,465 $ 301,293 $ 11,172 4 % Provision for credit losses —The provision for credit losses totaled $54.6 million for the year ended December 31, 2024, compared to $58.4 million for the year ended December 31, 2023.
Operating expenses 66 For the Year Ended Change (in thousands, except for percentages) December 31, $ % 2024 2023 2024/2023 2024/2023 Provision for credit losses $ 54,626 $ 58,386 $ (3,760 ) -6 % Processing and servicing costs 29,361 28,124 1,237 4 % Financial network and transaction costs 24,726 22,687 2,039 9 % Advertising and activation costs 53,446 56,662 (3,216 ) -6 % Compensation and benefits 105,760 93,303 12,457 13 % Technology and infrastructure 11,011 10,583 428 4 % Other operating expenses 33,535 31,548 1,987 6 % Total $ 312,465 $ 301,293 $ 11,172 4 % Provision for credit losses —The provision for credit losses totaled $54.6 million for the year ended December 31, 2024, compared to $58.4 million for the year ended December 31, 2023.
In the near term, we expect to continue to generate ExtraCash originations relying primarily on our balance sheet cash and Debt Facility, as needed. Interest payments on term loan borrowings under the Debt Facility are required to be made on a monthly basis. At December 31, 2024, $75.0 million of term loans under the Debt Facility were outstanding.
Debt Facility We maintain a credit facility (the "Debt Facility") with Victory Park Management, LLC ("VPC" or "Agent"). At December 31, 2025, $75.0 million of term loans under the Debt Facility were outstanding. Interest payments on term loan borrowings are required on a monthly basis.
We believe that our cash on hand should be sufficient to meet our working capital and capital expenditure requirements and fund our operations for a period of at least 12 months from the date of this report. We may raise additional capital through private or public equity or debt financings.
Assessment of Liquidity We believe that our existing cash and cash equivalents, together with cash generated from operations and available borrowings under the Debt Facility, will be sufficient to meet our working capital requirements, capital expenditure needs, and fund our operations for at least twelve months from the date of this Annual Report on Form 10-K and for the foreseeable future.
Compensation and Benefits Compensation and benefits expenses represent the compensation, inclusive of stock-based compensation and benefits, that we provide to our employees and the payments we make to third-party contractors. While we have an in-house customer service function, we employ third-party contractors to conduct call center operations and handle routine customer service inquiries and support.
While we have an in-house customer service function, we employ third-party contractors to conduct call center operations and manage routine customer service inquiries and support. Technology and infrastructure 60 Technology and infrastructure costs are associated with third-party Software-as-a-Service (“SaaS”) solutions, including cloud-based platforms that support the development, maintenance, scalability, and security of our products and internal systems.
We also believe these trends underscore a growing need for better financial solutions and illustrate the depth of our total addressable market (“TAM”), which we estimate to be approximately 180 million Americans that do not have access to affordable and effective banking solutions. 57 We believe that these high costs are the result of the cost structure of incumbents.
We estimate our total addressable market to be approximately 185 million Americans who do not have access to affordable and effective banking solutions. We believe these high costs reflect the cost structure of incumbents. Legacy institutions with brick-and-mortar networks, antiquated technology, and inefficient customer acquisition strategies have significant costs to serve, which they pass on to customers.
Through our mobile-first platform, we deliver innovative financial products designed to help underserved consumers manage their money more effectively. Our mission is to level the financial playing field by providing intuitive, transparent, and accessible solutions that empower our Members to navigate life’s financial challenges with confidence.
Our mission is to level the financial playing field by providing intuitive, transparent, and accessible solutions that empower our Members to navigate life's financial challenges with confidence. Since inception, over 19 million Members have signed up for the Dave app, with over 14 million having used at least one of our products.
For more information about our basis of presentation, refer to Note 2 in the accompanying consolidated financial statements of Dave included in this report. Service based revenue, net Service based revenue, net primarily consists of optional express processing fees, optional tips, overdraft service fees and subscriptions charged to Members, net of processor-related costs associated with ExtraCash disbursements.
For more information about our basis of presentation, refer to Note 2 in the accompanying consolidated financial statements of Dave included in this report. During the second quarter of 2025, we revised the presentation of certain items within our consolidated statement of operations.
We also believe that demand for ExtraCash may increase in periods of higher unemployment as consumers seek additional sources of liquidity to help them meet their financial obligations. Key Components of Statements of Operations Basis of presentation Currently, we conduct business through one operating segment which constitutes a single reportable segment.
As of February 25, 2026, approximately $113.2 million remained available under the existing program. Key Components of Statements of Operations Basis of Presentation Currently, we conduct business through one operating segment which constitutes a single reportable segment.
Overview Company Overview Dave was launched in 2017 to provide a faster, more transparent, and lower-cost alternative to traditional financial institutions, particularly for those living paycheck to paycheck. Inspired by the story of David vs. Goliath, we set out to challenge legacy banking by leveraging technology to expand financial access and improve consumer financial health.
Overview Company Overview Dave was founded in 2017 to provide a faster, more transparent, and lower-cost alternative to traditional financial institutions for Americans living paycheck to paycheck. Through our mobile-first platform, we deliver innovative financial products designed to help underserved consumers manage their money more effectively.
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On January 5, 2023, the Board of Directors approved an amendment to the Company’s certificate of incorporation to complete a 1-for-32 reverse stock split effective January 5, 2023. The effects of the reverse stock split have been reflected in the consolidated financial statements and the footnotes.
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Dave has earned multiple Best Place to Work recognitions from Built In over the past several years, reflecting our ongoing investment in becoming an exceptional workplace. Market Opportunity According to the Financial Health Network in 2025, approximately 185 million Americans, representing 69% of the U.S. population, are classified as financially "coping" or "vulnerable," up from 66% in 2021.
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We have engineered a purpose-driven platform designed to deliver on our mission, making a significant impact across the stakeholder groups we serve. Since our inception, more than 16 million Members have signed up for the Dave app, with over 12 million having used at least one of our products.
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A December 2025 PYMNTS report found that 67% of U.S. consumers were living paycheck to paycheck, up from 57% in 2021. This population pays approximately $43 billion annually in basic checking fees and over $225 billion in annual fees and interest for short-term credit, according to FHN research.
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Our business model is built on transparency and customer alignment and building relationships with our Members that drive positive outcomes for both them and our business. At the core of our success is a world-class team dedicated to delivering on our mission.
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In fiscal year 2025, customer acquisition cost remained stable at approximately $19 while payback periods have improved to under four months, our fastest on record, reflecting our focus on directing acquisition spend toward the highest return opportunities. 57 ARPU expansion is primarily driven by ExtraCash volume and the adoption of Dave Checking by Members.
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Dave has been recognized by Built In as a Best Place to Work for five consecutive years, reinforcing our commitment to both our Members and employees. Market Opportunity The U.S. financial system has historically failed to address the needs of the millions of Americans who are living paycheck to paycheck.
Added
Dave Debit Card actives generate approximately 1.7x higher monthly ARPU than non-card users and 11 times the average monthly transaction volume, indicating materially higher engagement and lifetime value. Dave Debit Card spend reached $534 million in the fourth quarter of 2025, a 17% increase year-over-year.
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According to the Financial Health Network (“FHN”) in 2024, approximately 180 million Americans are classified as financially “coping” or “vulnerable” representing over 70% of the U.S. population, up from 66% in 2021. A December 2024 report by PYMNTS also found that 65% of U.S. consumers were living paycheck to paycheck, up from 60% a year earlier.
Added
Our mid-2025 subscription fee increase from $1 to $3 improved customer lifetime value without materially affecting conversion or retention. Subscription revenue grew 92% year-over-year in the fourth quarter of 2025. Credit Performance ExtraCash profitability depends on approving creditworthy Members while maintaining disciplined delinquency and write-off rates. In fiscal year 2025, approval rates reached all-time highs, improving conversion efficiency.
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This market includes both young and financially challenged individuals who have trouble managing cash flow, have minimal savings, regularly overdraft, and pay high fees for access to financial services.
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In February 2025, we completed the transition to a simplified fee structure with a mandatory 5% overdraft service fee (including a $5 minimum), enhancing unit economics and monetization. In September 2025, we deployed CashAI v5.5, which nearly doubles the feature set of prior versions. Early results demonstrate improved risk ranking, higher average approval amounts, and lower delinquency rates.
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FHN research estimates there is approximately $38 billion of fees paid annually for access to basic checking services, including account maintenance fees, overdraft fees and ATM fees and that financially vulnerable and coping populations pay over $200 billion in annual fees and interest for short-term credit.
Added
CashAI has leveraged insights from over 180 million ExtraCash originations, a proprietary cash flow dataset that we believe provides a structural advantage in real-time credit decisioning. The short average term of ExtraCash (approximately 11 days) creates rapid feedback loops, enabling iterative model refinement. Economic conditions, particularly unemployment and consumer spending, materially influence Members' settlement capacity.
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We believe these insights are supported by a Dave study of our Members which reveals that traditional financial institutions charge consumers between $350-$400 of fees annually for access to basic checking services.
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Our real-time underwriting continuously evaluates transaction-level data to detect changes in income, spending, and employment. However, severe economic deterioration could materially increase delinquencies and write-offs despite model refinements. Funding and Interest Rate Sensitivity ExtraCash receivables funding costs are a material operating expense.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeLegal Services: The law firm of Mitchell Sandler LLC, of which the Company's director Andrea Mitchell is a partner, provided legal services to the Company, which totaled $ 1.3 million for the year ended December 31, 2024 . 107 Note 18 Income Taxes The components of income tax (benefit) expense for the years ended December 31, 2024, and 2023 were as follows (dollars in thousands): 2024 2023 Current: Federal $ 1,244 $ - State 1,237 120 Total current 2,481 120 Deferred: Federal - - State - - Total deferred - - Provision for (benefit from) income taxes $ 2,481 $ 120 A reconciliation between the Company’s federal statutory tax rate and its effective tax rate for the years ended December 31, 2024 and 2023 is as follows: 2024 2023 Federal statutory tax rate 21.0 % 21.0 % State taxes, net of federal benefit 5.8 % 23.3 % Non-deductible excess compensation 5.3 % - 2.4 % Warrant liability 0.6 % 0.1 % Earnout liability 0.3 % 0.0 % Stock-based compensation - 6.5 % - 9.1 % Other 1.2 % - 1.0 % Research and development tax credit - federal - 8.2 % 5.6 % Return to provision - 0.6 % 3.9 % Change in valuation allowance - 14.9 % - 41.6 % Effective tax rate 4.0 % - 0.2 % 108 The major components of the Company’s deferred tax assets and liabilities as of December 31, 2024 and 2023, consists of the following (dollars in thousands): 2024 2023 Deferred tax assets: Net operating loss carryforward $ 13,653 $ 32,616 Allowance for credit losses 6,530 5,839 Research and development tax credit 10,477 9,453 Accrued expenses 2,857 1,777 Accrued compensation 1,267 891 Lease liability 159 242 Stock-based compensation 1,102 926 Excess interest expense carryforward - 3,304 Section 174 research and development expenditures 21,721 11,664 Other 1,881 1,863 Total deferred tax assets 59,647 68,575 Deferred tax liabilities: Prepaid expenses ( 756 ) ( 529 ) Other ( 233 ) ( 529 ) Total deferred tax liabilities ( 989 ) ( 1,058 ) Total net deferred tax assets before valuation allowance 58,658 67,517 Less: valuation allowance ( 58,658 ) ( 67,517 ) Total net deferred taxes $ - $ - As of December 31, 2024 , the Company had $ 32.7 million of federal and $ 86.7 million of combined state net operating loss (“NOL”) carryforwards available to offset future taxable income.
Biggest changeIncome taxes paid (net of refunds) for the years ended December 31, 2025, 2024 and 2023 were as follows (in thousands): 2025 2024 2023 Federal $ 3,939 $ 2 $ - States (a) 1,642 ( 111 ) ( 586 ) Total $ 5,581 $ ( 109 ) $ ( 586 ) (a) Some jurisdictions met the 5% disaggregation threshold; however, the related amounts were immaterial 116 The major components of the Company’s deferred tax assets and liabilities as of December 31, 2025 and 2024, consists of the following (in thousands): 2025 2024 Deferred tax assets: Net operating loss carryforward $ 6,019 $ 13,653 Allowance for credit losses 9,328 6,530 Research and development tax credit 12,194 10,477 Accrued expenses 2,302 2,857 Accrued compensation 1,187 1,267 Lease liability 50 159 Stock-based compensation 1,455 1,102 Section 174 research and development expenditures - 21,721 Other 2,806 1,881 Total deferred tax assets 35,341 59,647 Deferred tax liabilities: Prepaid expenses ( 892 ) ( 756 ) Section 174 research and development expenditures ( 61 ) - Other ( 203 ) ( 233 ) Total deferred tax liabilities ( 1,156 ) ( 989 ) Total net deferred tax assets before valuation allowance 34,185 58,658 Less: valuation allowance - ( 58,658 ) Total net deferred taxes $ 34,185 $ - As of December 31, 2025 , the Company had no federal net operating loss carryforwards and $ 70.7 million of combined state net operating loss (“NOL”) carryforwards available to offset future taxable income.
No other terms of the repriced stock options were modified, and the repriced stock options will continue to vest according to their original vesting schedules and will retain their original expiration dates.
No other terms of the repriced stock options were modified, and the repriced stock options will continue to vest according to their original vesting schedules and will retain their original expiration dates.
Dave, Inc. and Jason Wilk (filed December 30, 2024 in the United States District Court for the Central District of California) In January 2023, the Company received a Civil Investigative Demand from the Federal Trade Commission (the “FTC”) staff seeking information in connection with the sale, offering, advertising, marketing or other promotion of cash advance products and online financial services.
Dave, Inc. and Jason Wilk (filed December 30, 2024 in the United States District Court for the Central District of California) 105 In January 2023, the Company received a Civil Investigative Demand from the Federal Trade Commission (the “FTC”) staff seeking information in connection with the sale, offering, advertising, marketing or other promotion of cash advance products and online financial services.
The 50,000 performance-based RSUs were subject to vesting as of December 31, 2024 and will be 105 considered vested and subsequently issued based upon the achievement of the remaining service requirement as outlined in the award agreements. Performance-Based Restricted Stock Units: The Company grants performance-based RSUs to certain executives and employees as part of its long-term incentive plan.
The 50,000 performance-based RSUs were subject to vesting as of December 31, 2024 and will be considered vested and subsequently issued based upon the achievement of the remaining service requirement as outlined in the award agreements. Performance-Based Restricted Stock Units: The Company grants performance-based RSUs to certain executives and employees as part of its long-term incentive plan.
The determination of the reportable segment is based on the nature of the Company’s products and services, as well as the financial performance, on a consolidated entity-wide basis, that are regularly reviewed by the CODM to guide resource allocation and assess performance. The Company’s operations, all of which are located in the United States, collectively support this single-segment structure.
The determination of the reportable segment is based on the nature of the Company’s products and services, as well as the financial performance, on a consolidated entity-wide basis, that are regularly reviewed by the CODM to guide resource allocation and assess performance. 118 The Company’s operations, all of which are located in the United States, collectively support this single-segment structure.
Asset-Backed Securities The fair value of these asset-backed securities is estimated by independent pricing services who use computerized valuation formulas to calculate current values. These securities are generally categorized in Level 2 of the fair value hierarchy or in Level 3 when market-based transaction activity is unavailable and significant unobservable inputs are used.
Asset-Backed Securities 108 The fair value of these asset-backed securities is estimated by independent pricing services who use computerized valuation formulas to calculate current values. These securities are generally categorized in Level 2 of the fair value hierarchy or in Level 3 when market-based transaction activity is unavailable and significant unobservable inputs are used.
The Company continually fulfills its obligation to each Member over the subscription term. The series of distinct services represents a single 82 performance obligation that is satisfied over time. The Company recognizes revenue ratably as the Member receives and consumes the benefits of the platform throughout the monthly contract period.
The Company continually fulfills its obligation to each Member over the subscription term. The series of distinct services represents a single performance obligation that is satisfied over time. The Company recognizes revenue ratably as the Member receives and consumes the benefits of the platform throughout the monthly contract period.
Note 9 Convertible Note On March 21, 2022, the Company entered into a Convertible Note Purchase Agreement (“Note Purchase Agreement”) with FTX Ventures Ltd., (the “Purchaser”) owner of FTX US (“FTX”), providing for the purchase and sale of a convertible note in the initial principal amount of $ 100.0 million (the “Note”).
Note 9 Convertible Note On March 21, 2022, the Company entered into a Convertible Note Purchase Agreement (“Note Purchase Agreement”) with FTX Ventures Ltd., (the “Purchaser”) owner of FTX US (“FTX”), providing for the purchase and sale of a 102 convertible note in the initial principal amount of $ 100.0 million (the “Note”).
The fair value of the RSUs that vest based solely on a service condition is equal to the estimated fair value of the Company’s Class A common stock on the grant date. This compensation 86 cost is recognized on a straight-line basis over the requisite service period for the entire award.
The fair value of the RSUs that vest based solely on a service condition is equal to the estimated fair value of the Company’s Class A common stock on the grant date. This compensation cost is recognized on a straight-line basis over the requisite service period for the entire award.
No Member individually contributed to 10 % or more of the Company’s revenues for the years ended December 31, 2024 and 2023. For further information regarding the Company’s products, services, and the accounting policies applied to its reportable segment, refer to Note 2 Significant Accounting Policies.
No Member individually contributed to 10 % or more of the Company’s revenues for the years ended December 31, 2025, 2024 and 2023. For further information regarding the Company’s products, services, and the accounting policies applied to its reportable segment, refer to Note 2 Significant Accounting Policies.
The Note bore interest at a rate of 3.00 % 94 per year (compounded semiannually), payable semi-annually in arrears on June 30th and December 31st of each year. Interest may be paid in-kind or in cash, at the Company’s option.
The Note bore interest at a rate of 3.00 % per year (compounded semiannually), payable semi-annually in arrears on June 30th and December 31st of each year. Interest may be paid in-kind or in cash, at the Company’s option.
Performance-Based Restricted Stock Unit Awards: Performance-based RSUs are valued on the grant date and the compensation cost is recognized over the requisite service period if and when the Company concludes it is probable that the performance metrics will be satisfied.
Performance-Based Restricted Stock Unit Awards: 94 Performance-based RSUs are valued on the grant date and the compensation cost is recognized over the requisite service period if and when the Company concludes it is probable that the performance metrics will be satisfied.
ATM fees earned from the Member’s usage of out-of-network reduced by related ATM transaction costs during the years ended December 31, 2024 and 2023 , were $ 3.1 million and $ 2.6 million, respectively.
ATM fees earned from the Member’s usage of out-of-network, reduced by related ATM transaction costs during the years ended December 31, 2025, 2024, and 2023 , were $ 2.3 million, $ 3.1 million, and $ 2.6 million, respectively.
Under this method, deferred tax assets and liabilities are based on the differences between the financial statement and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse.
Under this method, deferred tax assets and liabilities are based on the differences between the consolidated financial statement and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse.
If any impairment indicators are present, the Company will perform a recoverability test by comparing the sum of the estimated undiscounted cash flows attributed to the asset group to their 84 carrying value.
If any impairment indicators are present, the Company will perform a recoverability test by comparing the sum of the estimated undiscounted cash flows attributed to the asset group to their carrying value.
If based on the results of the recoverability test, no impairment is indicated as the remaining undiscounted cash flows exceed the carrying value of the software asset group, the carrying value of the asset group as of the assessment date is deemed fully recoverable.
If 92 based on the results of the recoverability test, no impairment is indicated as the remaining undiscounted cash flows exceed the carrying value of the software asset group, the carrying value of the asset group as of the assessment date is deemed fully recoverable.
The RSUs will be expensed monthly over the derived service period unless vesting conditions for a particular tranche are met, at which point all remaining compensation charges will be expensed in the period in which the vesting conditions were met.
The RSUs will be expensed monthly over the derived service period unless vesting conditions for a particular tranche are met, at which point all remaining compensation charges will be expensed in the period in which the vesting 113 conditions were met.
The following table presents the key inputs and assumptions used to value the RSUs modified during the quarter ended June 30, 2024: Remaining term 3.7 years Risk-free interest rate 4.7 % Expected volatility 71.7 % During the quarter ended September 30, 2024, the Company's Board of Directors approved a modification to the price targets in the market conditions and the addition of alternative performance conditions for 50,000 unvested RSUs and during the quarter the Company achieved the performance conditions.
The following table presents the key inputs and assumptions used to value the RSUs modified during the quarter ended June 30, 2024: Remaining term 3.7 years Risk-free interest rate 4.7 % Expected volatility 71.7 % During the third quarter of 2024, the Company's Board of Directors approved a modification to the price targets in the market conditions and the addition of alternative performance conditions for 50,000 unvested RSUs and during the quarter the Company achieved the performance conditions.
The key performance measure used by the CODM to make key operating decisions is consolidated net income (loss), as reported in the Consolidated Statement of Operations.
The key performance measure used by the CODM to make key operating decisions is consolidated net income, as reported in the Consolidated Statement of Operations.
The underlying money market instruments are primarily comprised of certificates of deposit and financial company asset backed commercial paper. Investments Investments consist of corporate bonds and notes, asset backed securities, and government securities and are classified as “available-for-sale,” as the sale of such securities may be required prior to maturity to implement the Company’s strategies.
The underlying money market instruments are primarily comprised of certificates of deposit and financial company asset backed commercial paper. Investments Investments consist of corporate bonds and notes, asset backed securities, and government securities and are classified as “available-for-sale” as the sale of such securities may be required prior to maturity to implement the Company’s strategies.
The Company earns interchange fees from Members spend on Dave-branded debit cards, which are reduced by interchange-related costs payable to fulfillment partners. Interchange revenue is remitted by merchants and represents a percentage of the underlying transaction value processed through a payment network.
The Company earns interchange fees from Members' spend on Dave-branded debit cards, which are reduced by interchange-related costs payable to fulfillment partners. Interchange revenue is remitted by merchants and represents a percentage of the underlying transaction value processed through a payment network.
The Company filed a registration statement covering the shares of Class A Common Stock issuable upon exercise of the Public Warrants and the Private Warrants.
The Company has filed a registration statement covering the shares of Class A common stock issuable upon exercise of the Public Warrants and the Private Warrants.
The fair value measurements for the securities are based upon the quoted prices of similar items in active markets multiplied by the number of securities owned. Investments: The following describes the valuation techniques used by the Company to measure the fair value of investments held as of December 31, 2024 and December 31, 2023. U.S.
The fair value measurements for the securities are based upon the quoted prices of similar items in active markets multiplied by the number of securities owned. Investments: The following describes the valuation techniques used by the Company to measure the fair value of investments held as of December 31, 2025 and December 31, 2024. U.S.
The fair value of investments is determined by quoted prices in active markets with unrealized gains and losses (other than credit related impairment) reported as a separate component of other comprehensive income (loss). For securities with unrealized losses, any credit related portion of the loss is recognized in earnings.
The fair value of investments is determined by quoted prices in active markets with unrealized gains and losses, net of tax (other than credit related impairment) reported as a separate component of other comprehensive income (loss). For securities with unrealized losses, any credit related portion of the loss is recognized in earnings.
Other costs are expensed as incurred and included within other operating expenses in the consolidated statements of operations. Capitalized costs for the years ended December 31, 2024 and 2023 , were $ 7.3 million and $ 7.6 million, respectively.
Other costs are expensed as incurred and included within other operating expenses in the consolidated statements of operations. Capitalized costs for the years ended December 31, 2025, 2024, and 2023 , were $ 6.5 million, $ 7.3 million, and $ 7.6 million, respectively.
Based upon the way the CODM reviews financial information and makes operating decisions and considering that the CODM reviews financial information on a consolidated basis for purposes of allocating resources and evaluating financial performance, the operations of the Company constitutes a single operating segment and reportable segment.
Based upon the way the CODM reviews financial information and makes operating decisions and considering that the CODM reviews financial information on a consolidated basis for purposes of allocating resources and evaluating financial performance, the operations of the Company constitute a single operating segment and reportable segment.
In November 2023, the Company extended the sublease for five more years ending October 98 2028. Under the terms of the sublease, the current monthly rent is $ 0.006 million, subject to an annual escalation of 4 %. All leases were classified as operating and operating lease expenses are presented within Other operating expenses in the consolidated statements of operations.
In November 2023, the Company extended the sublease for five more years ending October 2028. Under the terms of the sublease, the current monthly rent is $ 0.007 million, subject to an annual escalation of 4 %. All leases were classified as operating and operating lease expenses are presented within Other operating expenses in the consolidated statements of operations.
The Company recognized $ 37.3 million and $ 26.7 million of stock-based compensation expense arising from stock options, restricted stock unit grants and performance-based restricted stock unit grants which is recorded as a component of compensation and benefits in the consolidated statements of operations for the years ended December 31, 2024 and 2023, respectively.
The Company recognized $ 29.9 million, $ 37.3 million and $ 26.7 million of stock-based compensation expense arising from stock options, restricted stock unit grants and performance-based restricted stock unit grants which is recorded as a component of compensation and benefits in the consolidated statements of operations for the years ended December 31, 2025, 2024 and 2023, respectively.
The Company recognized insignificant amounts of interest expense as a component of income tax expense during the years ended December 31, 2024 and 2023. The income tax related accrued interest amounts were also insignificant as of December 31, 2024 and 2023, respectively.
The Company recognized insignificant amounts of interest expense as a component of income tax expense during the years ended December 31, 2025 and 2024. The income tax related accrued interest amounts were also insignificant as of December 31, 2025 and 2024, respectively.
The following table presents selected financial information with respect to the Company’s single operating and reportable segment for the years ended December 31, 2024 and 2023: 110 Dave Inc.
The following table presents selected financial information with respect to the Company’s single operating and reportable segment for the years ended December 31, 2025, 2024 and 2023: Dave Inc.
Note 13 Leases In January 2019, the Company entered into a lease agreement with PCJW Properties LLC (“PCJW”) for office space located in Los Angeles, California. The lease term is seven years , beginning January 1, 2019 and ending December 31, 2025. Monthly rent is $ 0.02 million, subject to an annual escalation of 5 %.
Note 13 Leases In January 2019, the Company entered into a lease agreement with PCJW Properties LLC (“PCJW”) for office space located in Los Angeles, California. The lease term was seven years , beginning January 1, 2019 and ended December 31, 2025. Monthly rent was $ 0.02 million, subject to an annual escalation of 5 %.
This measure to assess overall financial performance, identify areas for operation improvement, resource allocation and the allocation of budget between the provision for credit losses, processing and servicing costs, advertising and marketing, compensation and benefits and other operating expenses. This measure helps to ensure alignment with the Company’s long-term financial objectives and supports consistent evaluation across all business activities.
This measure is used to assess overall financial performance, identify areas for operation improvement and resource allocation and allocate budget between the provision for credit losses, processing and servicing costs, advertising and marketing, compensation and benefits and other operating expenses. This measure helps to ensure alignment with the Company’s long-term financial objectives and supports consistent evaluation across all business activities.
Basic net income (loss) attributable to holders of Common Stock per share is calculated by dividing net income (loss) attributable to holders of Common Stock by the weighted-average number of shares outstanding.
Basic net income (loss) attributable to holders of Common Stock per share is calculated by dividing net income (loss) attributable to holders of Common Stock by the weighted-average number of shares outstanding, exclusive of Treasury shares.
Note 21 Subsequent Events Subsequent events are events or transactions that occur after the consolidated balance sheet date, but before the consolidated financial statements are available to be issued.
Note 22 Subsequent Events Subsequent events are events or transactions that occur after the consolidated balance sheet date, but before the consolidated financial statements are available to be issued.
Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model. Concentration of Risk Financial instruments, which potentially subject the Company to concentrations of credit risk, principally consist of cash and cash equivalents, restricted cash, ExtraCash receivables, and accounts receivable.
Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model. Concentration of Risk Financial instruments, which potentially subject the Company to concentrations of credit risk, principally consist of cash and cash equivalents, restricted cash, ExtraCash receivables, and accounts recei vable.
Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of Dave Inc. and subsidiaries (the "Company") as of December 31, 2024 and 2023, the related consolidated statements of operations, comprehensive income (loss), stockholders’ equity, and cash flows, for each of the two years in the period ended December 31, 2024, and the related notes (collectively referred to as the "financial statements").
Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of Dave Inc. and subsidiaries (the "Company") as of December 31, 2025 and 2024, the related consolidated statements of operations, comprehensive income (loss), stockholders’ equity, and cash flows, for each of the three years in the period ended December 31, 2025, and the related notes (collectively referred to as the "financial statements").
A roll-forward of the Level 3 Founder Holder Earnout Shares liability is as follows (in thousands): Opening value at January 1, 2024 $ 31 Change in fair value during the period 965 Ending value at December 31, 2024 $ 996 The Company used a Monte Carlo Simulation Method to determine the fair value of the Founder Holder Earnout Shares liability.
A roll-forward of the Level 3 Founder Holder Earnout Shares liability is as follows (in thousands): Opening value at January 1, 2024 $ 31 Change in fair value during the period 965 Ending value at December 31, 2024 996 Change in fair value during the period 3,285 Ending value at December 31, 2025 $ 4,281 The Company used a Monte Carlo Simulation Method to determine the fair value of the Founder Holder Earnout Shares liability.
Transaction Based Revenue, Net: Transaction based revenue, net primarily consists of interchange and ATM revenues from the Company’s Checking Product, net of certain interchange and ATM-related fees, fees earned from funding and withdrawal-related transactions, volume support from a certain co-branded agreement, fees earned related to the Rewards Product for Members who make debit card spending transactions at participating merchants and deposit referrals and are recognized at the point in time the transactions occur, as the performance obligations are satisfied and the variable consideration is not constrained.
Transaction Based Revenue, Net: 90 Transaction based revenue, net primarily consists of interchange and ATM revenues from the Company’s Checking Products, net of certain interchange and ATM-related fees, fees earned from funding and withdrawal-related transactions of Member's funds, volume support from a certain co-branded agreement, dormant account fees, fees earned related to the Rewards Product for Members who make debit card spending transactions at participating merchants and deposit referrals and are recognized at the point in time the transactions occur, as the performance obligations are satisfied and the variable consideration is not constrained.
In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2024, in conformity with accounting principles generally accepted in the United States of America.
In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America.
At December 31, 2024 , total estimated unrecognized stock-based compensation cost related to nonvested performance-based RSUs was approximately $ 4.9 million, which is expected to be recognized over a weighted-average period of 1.5 years. 106 Note 17 Related-Party Transactions Leasing Arrangements: For each of the years ended December 31, 2024 and 2023 , the Company paid $ 0.4 million under lease agreements with PCJW, which is controlled by the Company's founders (including the Company's CEO) for general office space in Los Angeles, California.
At December 31, 2025 , total estimated unrecognized stock-based compensation cost related to nonvested performance-based RSUs was approximately $ 11.6 million, which is expected to be recognized over a weighted-average period of 1.4 years. 114 Note 17 Related-Party Transactions Leasing Arrangements: For each of the years ended December 31, 2025, 2024, and 2023, the Company paid $ 0.4 million under lease agreements with PCJW, which is controlled by the Company's founders (including the Company's CEO) for general office space in Los Angeles, California.
The Company has estimated $ 2.0 million and $ 1.3 million of uncertain tax positions as of December 31, 2024 and 2023, respectively, related to state income taxes. and federal and state research and development tax credits.
The Company has estimated $ 3.3 million and $ 2.0 million of uncertain tax positions as of December 31, 2025 and 2024, respectively, related to state income taxes, and federal and state research and development tax credits.
Unrealized losses on the available-for-sale investment securities as of December 31, 2024 and December 31, 2023 are primarily the result of increases in interest rates as a significant portion of the investments were purchased prior to the 91 Federal reserve commenced interest rate increases in 2022.
Unrealized losses on the available-for-sale investment securities as of December 31, 2024 were primarily the result of increases in interest rates as a significant portion of the investments were purchased prior to the Federal reserve commenced interest rate increases in 2022.
A roll-forward of the Level 3 private warrant liability is as follows (in thousands): Opening value at January 1, 2024 $ 105 Change in fair value during the period 811 Ending value at December 31, 2024 $ 916 The Company used a Black-Scholes option pricing model to determine the fair value of the private warrant liability.
A roll-forward of the Level 3 private warrant liability is as follows (in thousands): Opening value at January 1, 2024 $ 105 Change in fair value during the period 811 Ending value at December 31, 2024 916 Change in fair value during the period 4,663 Ending value at December 31, 2025 $ 5,579 The Company used a Black-Scholes option pricing model to determine the fair value of the private warrant liability.
The Company is subject to examination by taxing authorities in the jurisdictions in which it files tax returns, including federal, California, and various other state jurisdictions. The federal statute of limitations remains open for the tax periods December 31, 2021 and thereafter.
The Company is subject to examination by taxing authorities in the jurisdictions in which it files tax returns, including federal, California, and various other state jurisdictions. The federal statute of limitations remains open for the tax years December 31, 2022 and thereafter.
Accrued interest of $ 0.09 million and $ 0.8 million is included in investments within the consolidated balance sheets for the years ended December 31, 2024 and December 31, 2023, respectively.
Accrued interest of $ 0 and $ 0.09 million is included in investments within the consolidated balance sheets for the years ended December 31, 2025 and 2024, respectively.
A roll-forward of the Level 1 public warrant liability is as follows (dollars in thousands): Opening value at January 1, 2024 $ 97 Change in fair value during the period 919 Ending value at December 31, 2024 $ 1,016 100 Private Warrants: As discussed further in Note 10, Warrant Liabilities, in January 2022, upon completion of the Business Combination, private warrants were automatically converted to warrants to purchase Common Stock of the Company.
A roll-forward of the Level 1 public warrant liability is as follows (in thousands): Opening value at January 1, 2024 $ 97 Change in fair value during the period 919 Ending value at December 31, 2024 1,016 Change in fair value during the period 5,201 Ending value at December 31, 2025 $ 6,217 Private Warrants: As discussed further in Note 10, Warrant Liabilities, in January 2022, upon completion of the Business Combination, private warrants were automatically converted to warrants to purchase Common Stock of the Company.
The following is a schedule of future minimum rental payments as of December 31, 2024, under Company’s sublease for the properties located in Los Angeles, California signed with PCJW (in thousands): Year Related-Party Commitment 2025 386 2026 79 2027 83 2028 72 Total minimum lease payments $ 620 Less: imputed interest ( 66 ) Total lease liabilities $ 554 The related-party components of the lease right-of-use assets, lease liabilities, short-term, and lease liabilities, long-term are presented as part of the right-of-use asset and lease liability on the consolidated balance sheets.
The following is a schedule of future minimum rental payments as of December 31, 2025, under Company’s sublease for the properties located in Los Angeles, California signed with PCJW (in thousands): Year Related-Party Commitment 2026 79 2027 83 2028 72 Total minimum lease payments $ 234 Less: imputed interest ( 30 ) Total lease liabilities $ 204 The related-party components of the lease right-of-use assets, lease liabilities, both short-term, and long-term, are presented as part of the right-of-use asset and lease liability on the consolidated balance sheets.
The unrecognized tax benefits of $ 0.8 million as of December 31, 2024, would, if recognized, affect the effective tax rate. Although it is possible that the amount of 109 unrecognized tax benefits with respect to the uncertain tax positions will increase or decrease in the next 12 months, the Company does not expect material changes.
The unrecognized tax benefits of $ 3.3 million as of December 31, 2025, would, if recognized, affect the effective tax rate. Although it is possible that the amount of unrecognized tax benefits with respect to the uncertain tax positions will increase or decrease in the next 12 months, the Company does not expect material changes.
The Public Warrants are exercisable, provided that the Company continues to have an effective registration statement under the Securities Act covering the shares of Class A Common Stock issuable upon exercise of the Public Warrants and a current prospectus relating to them is available (or the Company permits holders to exercise their Public Warrants on a cashless basis and such cashless exercise is exempt from registration under the Securities Act).
The Public Warrants are exercisable provided that the Company has an effective registration statement under the Securities Act covering the shares of Class A common stock issuable upon exercise and a current prospectus relating to such shares is available, or, alternatively, that the Company permits holders to exercise their Public Warrants on a cashless basis in a transaction exempt from registration under the Securities Act.
During the quarter ended March 31, 2023, th e Company granted 629,454 RSUs to certain employees in six tranches. Each of the six tranches contain service and market conditions. The market conditions relate to the achievement of 104 certain specified price targets.
During the first quarter of 2023, th e Company granted 629,454 RSUs to certain employees in six tranches. Each of the six tranches contain service and market conditions. The market conditions relate to the achievement of certain specified price targets.
As of December 31, 2024, the Company was not in compliance with a specific debt covenant under its existing Debt Facility. In particular, a breach existed relating to the Minimum Receivable Loan-to-Value ("LTV Ratio"), which exceeded the allowable limits set forth in the covenant.
As of June 30, 2025, the Company was not in compliance with a specific covenant under its existing Debt Facility. In particular, a breach existed relating to the Minimum Receivable Loan-to-Value ("LTV Ratio"), which exceeded the allowable limits set forth in the covenant.
The following table presents the assumptions used to value the private warrant liability for the year ended December 31, 2024: Exercise price $ 368 Expected volatility 66.9 % Risk-free interest rate 4.25 % Remaining term 2.01 years Dividend yield 0 % Earnout Shares Liability: As part of the recapitalization and business combination in January 2022, 49,563 shares of C lass A Common Stock held by founders of VPCC are subject to forfeiture if the vesting condition is not met over the five year term following the Closing Date (“Founder Holder Earnout Shares”).
The following table presents the assumptions used to value the private warrant liability for the year ended December 31, 2025: Exercise price $ 368 Expected volatility 73.34 % Risk-free interest rate 3.48 % Remaining term 1.01 years Dividend yield 0 % 109 Earnout Shares Liability: As part of the recapitalization and business combination in January 2022, 49,563 shares of C lass A Common Stock held by founders of VPCC are subject to forfeiture if the vesting condition is not met over the five year term following the Closing Date (“Founder Holder Earnout Shares”).
There can be no assurance that the Company will be successful in the litigation, and the Company may incur a loss in excess of the amount accrued. The defense or resolution of this matter could involve significant monetary costs and have a material impact on the Company’s business, financial results and operations.
There can be no assurance that the Company will be successful in these or other matters, and the Company may incur a 106 loss in excess of the amount accrued. The defense or resolution of these or other matters could involve significant monetary costs and have a material impact on the Company’s business, financial results and operations.
Redemption of Public Warrants when the price per share of Class A Common Stock equals or exceeds $ 576.00 : Once the Public Warrants become exercisable, the Company may redeem the outstanding Public Warrants for cash: • in whole and not in part; • at a price of $ 0.01 per warrant; • upon a minimum of 30 days prior written notice of redemption; and if, and only if, the closing price of Class A Common Stock equals or exceeds $ 576.00 per share (as adjusted) for any 20 trading days within a 30 -trading day period ending on the third trading day prior to the date on which the Company sends the notice of redemption to the warrant holders.
Once the Public Warrants become exercisable, the Company may redeem all (but not less than all) of the outstanding Public Warrants for cash at a price of $ 0.01 per warrant, upon at least 30 days’ prior written notice, if, and only if, the closing price of the Class A common stock equals or exceeds $ 576.00 per share (as adjusted) for any 20 trading days within a 30 ‑trading‑day period ending on the third trading day prior to the date on which the Company sends the notice of redemption to warrant holders.
No impairment charges were recognized related to long-lived assets for the years ended December 31, 2024 and 2023. Amortization expense related to change in useful life of a certain definite-lived intangible asset for the year ended December 31, 2024 was $ 0.8 million.
Amortization expense related to change in useful life of a certain definite-lived intangible asset for the year ended December 31, 2025, 2024, and 2023 was $ 0.6 million, $ 0.8 million and 0.3 million, respectively. No impairment charges were recognized related to long-lived assets for the yea rs ended December 31, 2025, 2024 and 2023 .
The following table sets forth the computation of the Company’s basic and diluted net income (loss) per share attributable to holders of common stock ( in thousands, except share data ): For the Year ended December 31, 2024 2023 Numerator Net income (loss) attributed to common stockholders—basic and diluted $ 57,873 $ ( 48,517 ) Denominator Weighted-average shares of common stock—basic 12,520,789 11,934,699 Dilutive effect of stock options 298,088 - Dilutive effect of RSU 1,003,705 - Weighted-average shares of common stock—diluted 13,822,582 11,934,699 Net income (loss) per share Basic $ 4.62 $ ( 4.07 ) Diluted $ 4.19 $ ( 4.07 ) The following potentially dilutive shares were excluded from the computation of diluted net income (loss) per share for the periods presented because including them would have been antidilutive: For the Year ended December 31, 2024 2023 Equity incentive awards 475,520 2,493,468 Convertible debt - 312,500 Total 475,520 2,805,968 The Company also excluded 11,444,235 public and private warrants and 49,563 earnout shares that were potentially dilutive from the computation of diluted net income (loss) for the years ended December 31, 2024 and 2023 , respectively, as including them would have been antidilutive.
The following table sets forth the computation of the Company’s basic and diluted net income (loss) per share attributable to holders of common stock ( in thousands, except share data ): For the Years Ended December 31, 2025 2024 2023 Numerator Net income (loss) attributed to common stockholders—basic and diluted $ 195,865 $ 57,873 $ ( 48,517 ) Denominator Weighted-average shares of common stock—basic 13,366,072 12,520,789 11,934,699 Dilutive effect of stock options 195,188 298,088 - Dilutive effect of RSU 919,443 1,003,705 - Weighted-average shares of common stock—diluted 14,480,703 13,822,582 11,934,699 Net income (loss) per share Basic $ 14.65 $ 4.62 $ ( 4.07 ) Diluted $ 13.53 $ 4.19 $ ( 4.07 ) The following potentially dilutive shares were excluded from the computation of diluted net income (loss) per share for the periods presented because including them would have been antidilutive: For the Years Ended December 31, 2025 2024 2023 Equity incentive awards 458,850 475,520 2,493,468 Convertible debt - - 312,500 Total 458,850 475,520 2,805,968 The Company also exclude d 11,444,235 public and private warrants and 49,563 earno ut shares that were potentially dilutive from the computation of diluted net income (loss) for the years ended December 31, 2025 and 2024, respectively, as including them would have been antidilutive.
For accounting purposes, the Company treats tips as an adjustment of yield to ExtraCash and are recognized over the average expected contractual term of its ExtraCash receivables. Subscriptions The Company accounts for subscriptions in accordance with ASC 606, Revenue from Contracts with Customers (“ASC 606”).
For accounting purposes, tips are treated as an adjustment of yield to ExtraCash and are recognized over the average expected contractual term of its ExtraCash receivables. The Company discontinued optional tips from its business model in February 2025. Subscriptions The Company accounts for subscriptions in accordance with ASC 606, Revenue from Contracts with Customers (“ASC 606”).
Additionally, a total of 160,453 performance-based RSUs were subject to vesting as of December 31, 2024 and will be considered vested and subsequently issued to participants based upon the achievement of the remaining service requirements as outlined in the award agreements.
A total of 291,512 performance-based RSUs were subject to vesting as of December 31, 2025 and will be considered vested and subsequently issued to participants based upon the achievement of the remaining service requirements as outlined in the award agreements.
A reconciliation of the Company’s gross unrecognized tax benefits as of December 31, 2024 and 2023 is as follows (dollars in thousands): 2024 2023 Balance at beginning of year $ 1,325 $ 849 Increases to prior positions 95 - Decreases to prior positions - - Increases for current year positions 606 476 Balance at end of year $ 2,026 $ 1,325 As of December 31, 2024, the Company had $ 2.0 million of gross unrecognized tax benefits related to state income taxes and federal and state research and development tax credits.
A reconciliation of the Company’s gross unrecognized tax benefits as of December 31, 2025 and 2024 is as follows (in thousands): 117 2025 2024 Balance at beginning of year $ 2,026 $ 1,325 Increases to prior positions 57 95 Decreases to prior positions - - Increases for current year positions 1,189 606 Balance at end of year $ 3,272 $ 2,026 As of December 31, 2025 , the Company had $ 3.3 million of gross unrecognized tax benefits related to state income taxes and federal and state research and development tax credits.
The Company’s accounting policy is to perform annual reviews of capitalized internally developed software projects to determine whether any impairment indicators are present as of December 31, or whenever a change in circumstances suggests an impairment indicator is present.
Internally developed software is amortized over its estimated useful life of 3 years. The Company’s accounting policy is to perform annual reviews of capitalized internally developed software projects to determine whether any impairment indicators are present as of December 31, or whenever a change in circumstances suggests an impairment indicator is present.
Processing fees are accounted for as non-refundable loan origination fees and are recognized as revenues over the average expected contractual term of its ExtraCash transactions. Costs incurred by the Company to originate ExtraCash are treated as direct loan origination costs. These direct loan origination costs are netted against ExtraCash-related income over the average expected contractual term of an ExtraCash.
For accounting purposes, these fees are considered non-refundable origination fees and are recognized as revenue over the average expected contractual term of the related ExtraCash transactions. Costs incurred by the Company to originate ExtraCash are treated as direct loan origination costs. These direct loan origination costs are netted against ExtraCash-related income over the average expected contractual term of an ExtraCash.
Note 6 Property and Equipment, Net Property and equipment, net consisted of the following (in thousands): December 31, 2024 December 31, 2023 Computer equipment $ 1,094 $ 1,133 Leasehold improvements 1,189 1,178 Furniture and fixtures 92 93 Total property and equipment 2,375 2,404 Less: accumulated depreciation ( 1,671 ) ( 1,286 ) Property and equipment, net $ 704 $ 1,118 Depreciation expense for the years ended December 31, 2024 and 2023 , was approximately $ 0.7 million and $ 0.6 million, respectively.
Note 6 Property and Equipment, Net Property and equipment, net consisted of the following (in thousands): December 31, 2025 December 31, 2024 Computer equipment $ 1,367 $ 1,094 Leasehold improvements 1,193 1,189 Furniture and fixtures 92 92 Total property and equipment 2,652 2,375 Less: accumulated depreciation ( 2,178 ) ( 1,671 ) Property and equipment, net $ 474 $ 704 Depreciation expense for the years ended December 31, 2025, 2024, and 2023 was approximately $ 0.5 million, $ 0.7 million and $ 0.6 million, respectively.
Direct origination costs recognized as a reduction of ExtraCash-related income during the years ended December 31, 2024 and 2023 , were $ 3.5 million and $ 3.3 million, respectively. Tips The Company encourages, but does not contractually require its Members who receive ExtraCash to leave a discretionary tip.
Direct origination costs recognized as a reduction of ExtraCash-related income during the years ended December 31, 2025, 2024, and 2023 , were $ 6.0 million, $ 3.5 million, and $ 3.3 million, respectively. Tips Prior to the second quarter of 2025, the Company encouraged, but did not contractually require, its Members who receive ExtraCash to leave a discretionary tip.
The Company’s leasing activities are as follows (in thousands): For the Year Ended December 31, 2024 2023 Operating lease cost $ 347 $ 331 Short-term lease cost - - Total lease cost $ 347 $ 331 For the Year Ended December 31, 2024 2023 Other information: Cash paid for operating leases $ 369 $ 351 Weighted-average remaining lease term - operating lease 2.32 2.98 Weighted-average discount rate - operating lease 10 % 10 % The future minimum lease payments as of December 31, 2024, were as follows (in thousands): Year Related-Party Commitment 2025 $ 386 2026 79 2027 83 2028 72 Total minimum lease payments $ 620 Less: imputed interest ( 66 ) Total lease liabilities $ 554 Note 14 Fair Value of Financial Instruments The following are the major categories of assets and liabilities measured at fair value on a recurring basis as of December 31, 2024 and 2023, using quoted prices in active markets for identical assets (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3) (in thousands): December 31, 2024 Level 1 Level 2 Level 3 Total Assets Marketable securities $ 97 $ — $ — $ 97 Investments — 40,473 — 40,473 Total assets $ 97 $ 40,473 $ — $ 40,570 Liabilities Warrant liabilities - public warrants $ 1,016 $ — $ — $ 1,016 Warrant liabilities - private warrants — — 916 916 Earnout liabilities — — 996 996 Total liabilities $ 1,016 $ — $ 1,912 $ 2,928 The Company had no assets and liabilities measured at fair value on a non-recurring basis as of December 31, 2024 and 2023. 99 The Company also has financial instruments not measured at fair value.
The Company’s leasing activities are as follows (in thousands): For the Year Ended, 2025 2024 Operating lease cost $ 348 $ 347 Short-term lease cost - - Total lease cost $ 348 $ 347 For the Year Ended, 2025 2024 Other information: Cash paid for operating leases $ 386 $ 369 Weighted-average remaining lease term - operating lease 2.84 2.32 Weighted-average discount rate - operating lease 10 % 10 % The future minimum lease payments as of December 31, 2025, were as follows (in thousands): Year Related-Party Commitment 2026 79 2027 83 2028 72 Total minimum lease payments $ 234 Less: imputed interest $ ( 30 ) Total lease liabilities $ 204 Note 14 Fair Value of Financial Instruments The following are the major categories of assets and liabilities measured at fair value on a recurring basis as of December 31, 2025 and 2024, using quoted prices in active markets for identical assets (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3) (in thousands): 107 December 31, 2025 Level 1 Level 2 Level 3 Total Assets Investments $ — $ 40,788 $ — $ 40,788 Total assets $ — $ 40,788 $ — $ 40,788 Liabilities Warrant liabilities - public warrants $ 6,217 $ — $ — $ 6,217 Warrant liabilities - private warrants — — 5,579 5,579 Earnout liabilities — — 4,281 4,281 Total liabilities $ 6,217 $ — $ 9,860 $ 16,077 December 31, 2024 Level 1 Level 2 Level 3 Total Assets Marketable securities $ 97 $ — $ — $ 97 Investments — 40,473 — 40,473 Total assets $ 97 $ 40,473 $ — $ 40,570 Liabilities Warrant liabilities - public warrants $ 1,016 $ — $ — $ 1,016 Warrant liabilities - private warrants — — 916 916 Earnout liabilities — — 996 996 Total liabilities $ 1,016 $ — $ 1,912 $ 2,928 The Company had no assets and liabilities measured at fair value on a non-recurring basis as of December 31, 2025 and 2024.
We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB.
If the Company calls the Public Warrants for redemption, management will have the option to require all holders that wish to exercise the Public Warrants to do so on a “cashless basis,” as described in the warrant agreement.
If the Company calls the Public Warrants for redemption, management may require all holders that wish to exercise to do so on a cashless basis, as described in the warrant agreement.
Consolidated Statements of Comprehensive Income (Loss ) (in thousands) For the Year Ended December 31, 2024 2023 Net income (loss) $ 57,873 $ ( 48,517 ) Other comprehensive gain (loss): Unrealized gain (loss) on available-for-sale securities ( 428 ) 2,324 Comprehensive income (loss) $ 57,445 $ ( 46,193 ) See accompanying notes to the consolidated financial statements. 76 Dave Inc.
Consolidated Statements of Comprehensive Income (Loss ) (in thousands) For the Years Ended December 31, 2025 2024 2023 Net income (loss) $ 195,865 $ 57,873 $ ( 48,517 ) Other comprehensive gain (loss): Unrealized gain (loss) on available-for-sale securities, net of tax 153 ( 428 ) 2,324 Comprehensive income (loss) $ 196,018 $ 57,445 $ ( 46,193 ) See accompanying notes to the consolidated financial statements. 84 Dave Inc.
The Company has evaluated cash (Level 1), restricted cash (Level 1), accounts payable (Level 2), accrued expenses (Level 2) and ExtraCash receivables (Level 3) and believes the carrying value approximates the fair value due to the short-term nature of these balances. The fair value of the debt facility (Level 2) approximates its carrying value.
The Company also has financial instruments not measured at fair value. The Company has evaluated cash (Level 1), restricted cash (Level 1), accounts payable (Level 2), accrued expenses (Level 2) and ExtraCash receivables (Level 3) and believes the carrying value approximates the fair value due to the short-term nature of these balances.
Marketable Securities: The Company evaluated the quoted market prices in active markets for its marketable securities and has classified its securities as Level 1. The Company’s investments in marketable securities are exposed to price fluctuations.
The fair value of the debt facility (Level 2) approximates its carrying value. Marketable Securities: The Company evaluated the quoted market prices in active markets for its marketable securities and has classified its securities as Level 1. The Company’s investments in marketable securities are exposed to price fluctuations.
Consolidated Statement of Stockhol ders’ Equity (in thousands, except share data) Common stock Class A Class V Additional paid-in capital Accumulated other comprehensive income (loss) Accumulated deficit Total stockholders’ equity Shares Amount Shares Amount Balance at January 1, 2023 10,284,657 $ 1 1,514,082 $ - $ 270,037 $ ( 1,675 ) $ ( 161,803 ) $ 106,560 Issuance of Class A common stock in connection with stock plans 349,516 - - - 34 - - 34 Payment for fractional shares after reverse stock split ( 12 ) ( 12 ) Stock-based compensation - - - - 26,674 - - 26,674 Unrealized gain on available-for-sale securities - - - - - 2,324 - 2,324 Net loss - - - - - - ( 48,517 ) ( 48,517 ) Balance at December 31, 2023 10,634,173 $ 1 1,514,082 $ - $ 296,733 $ 649 $ ( 210,320 ) $ 87,063 Issuance of Class A common stock in connection with stock plans 867,792 - - - 1,266 - - 1,266 Stock-based compensation - - - - 37,327 - - 37,327 Unrealized loss on available-for-sale securities - - - - - ( 428 ) - ( 428 ) Net income - - - - - - 57,873 57,873 Balance at December 31, 2024 11,501,965 1 1,514,082 - 335,326 - 221 ( 152,447 ) 183,101 See accompanying notes to the consolidated financial statements. 77 Dave Inc.
Consolidated Statement of Stockhol ders’ Equity (in thousands, except share data) Common stock Class A Class V Additional paid-in capital Treasury shares Accumulated other comprehensive (loss) income Retained earnings (accumulated deficit) Total stockholders’ equity Shares Amount Shares Amount Balance at January 1, 2023 10,284,657 $ 1 1,514,082 $ - $ 270,037 $ - $ - $ ( 1,675 ) $ ( 161,803 ) $ 106,560 Issuance of Class A common stock in connection with stock plans 349,516 - - - 34 - - - 34 Payment for fractional shares after reverse stock split - - - - ( 12 ) - - - ( 12 ) Stock-based compensation - - - - 26,674 - - - 26,674 Unrealized gain on available-for-sale securities - - - - - - 2,324 - 2,324 Net loss - - - - - - - ( 48,517 ) ( 48,517 ) Balance at January 1, 2024 10,634,173 $ 1 1,514,082 $ - $ 296,733 $ - $ - $ 649 $ ( 210,320 ) $ 87,063 Issuance of Class A common stock in connection with stock plans 867,792 - - - 1,266 - - - 1,266 Stock-based compensation - - - - 37,327 - - - 37,327 Unrealized loss on available-for-sale securities - - - - - - ( 428 ) - ( 428 ) Net income - - - - - - - 57,873 57,873 Balance at January 1, 2025 11,501,965 $ 1 1,514,082 $ - $ 335,326 $ - $ - $ 221 $ ( 152,447 ) $ 183,101 Issuance of Class A common stock in connection with stock plans 941,384 - - - 761 - - - 761 Shares withheld related to net share settlement ( 132,312 ) - - - ( 13,319 ) - - - ( 13,319 ) Repurchase of Class A common stock ( 274,490 ) - - - - ( 43,730 ) - - ( 43,730 ) Conversion of Class V common stock to Class A common stock 200,000 - ( 200,000 ) - - - - - - Stock-based compensation - - - - 29,896 - - - 29,896 Unrealized gain on available-for-sale securities - - - - - - 153 - 153 Net income - - - - - - - 195,865 195,865 Balance at December 31, 2025 12,236,547 $ 1 1,314,082 $ - $ 352,664 - $ ( 43,730 ) $ 374 $ 43,418 $ 352,727 See accompanying notes to the consolidated financial statements. 85 Dave Inc.
Consolidated Statemen ts of Cash Flows (in thousands) For the Year Ended December 31, 2024 2023 Operating activities Net income (loss) $ 57,873 $ ( 48,517 ) Adjustments to reconcile net income (loss) to net cash used in operating activities: Depreciation and amortization 7,681 5,544 Provision for credit losses 54,626 58,386 Changes in fair value of earnout liabilities 965 ( 22 ) Changes in fair value of public and private warrant liabilities 1,729 ( 260 ) Gain on extinguishment of convertible debt ( 33,442 ) - Stock-based compensation 37,327 26,674 Non-cash interest 251 3,114 Non-cash lease expense ( 21 ) ( 20 ) Changes in fair value of marketable securities and investments ( 16 ) 44 Changes in operating assets and liabilities: ExtraCash receivables, service based revenue ( 6,160 ) ( 4,082 ) Prepaid income taxes 148 683 Prepaid expenses and other current assets ( 8,157 ) 3,311 Accounts payable 1,282 ( 5,935 ) Accrued expenses 4,082 1,661 Legal settlement accrual 3,775 ( 6,120 ) Other current liabilities 267 ( 446 ) Other non-current liabilities 2,904 5 Other non-current assets 23 ( 266 ) Net cash provided by operating activities 125,137 33,754 Investing activities Payments for internally developed software costs ( 7,300 ) ( 7,895 ) Purchase of property and equipment ( 262 ) ( 688 ) Net originations and collections of ExtraCash receivables ( 111,477 ) ( 62,967 ) Purchase of investments ( 111,311 ) ( 120,016 ) Sale and maturity of investments 183,652 177,863 Purchase of marketable securities ( 59,274 ) ( 34,399 ) Sale of marketable securities 60,129 33,727 Net cash used in investing activities ( 45,843 ) ( 14,375 ) Financing activities Payment for fractional shares on reverse stock split - ( 12 ) Proceeds from issuance of common stock for stock option exercises 1,266 34 Payment of costs for extinguishment of convertible debt ( 1,261 ) - Repayment of borrowings on convertible debt, long-term ( 71,000 ) - Net cash (used in) provided by financing activities ( 70,995 ) 22 Net increase in cash and cash equivalents and restricted cash 8,299 19,401 Cash and cash equivalents and restricted cash, beginning of the period 43,078 23,677 Cash and cash equivalents and restricted cash, end of the period $ 51,377 $ 43,078 78 Supplemental disclosure of non-cash investing and financing activities: Property and equipment purchases in accounts payable and accrued liabilities $ - $ 2 Operating lease right of use assets recognized $ - $ 298 Operating lease liabilities recognized $ - $ 298 Supplemental disclosure of cash paid for: Income taxes $ ( 109 ) $ ( 586 ) Interest $ 7,652 $ 8,630 The following table provides a reconciliation of cash and cash equivalents, and restricted cash reported within the consolidated balance sheets with the same as shown in the consolidated statement of cash flows Cash and cash equivalents $ 49,718 $ 41,759 Restricted cash 1,659 1,319 Total cash, cash equivalents, and restricted cash, end of the period $ 51,377 $ 43,078 See accompanying notes to the consolidated financial statements. 79 Note 1 Organization and N ature of Business Company Overview Dave ("the Company") was launched in 2017 to provide a faster, more transparent, and lower-cost alternative to traditional financial institutions, particularly for those living paycheck to paycheck.
Consolidated Statemen ts of Cash Flows (in thousands) For the Years Ended December 31, 2025 2024 2023 Operating activities Net income (loss) $ 195,865 $ 57,873 $ ( 48,517 ) Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 7,131 7,681 5,544 Provision for credit losses 91,040 54,626 58,386 Changes in fair value of earnout liabilities 3,285 965 ( 22 ) Changes in fair value of public and private warrant liabilities 9,864 1,729 ( 260 ) Gain on extinguishment of convertible debt - ( 33,442 ) - Stock-based compensation 29,896 37,327 26,674 Deferred income taxes ( 34,185 ) - - Non-cash interest - 251 3,114 Non-cash lease expense ( 38 ) ( 21 ) ( 20 ) Changes in fair value of marketable securities and investments 76 ( 16 ) 44 Changes in operating assets and liabilities: ExtraCash receivables, service based revenue ( 16,657 ) ( 6,160 ) ( 4,082 ) Prepaid income taxes - 148 683 Prepaid expenses and other current assets ( 1,943 ) ( 8,157 ) 3,311 Accounts payable 1,591 1,282 ( 5,935 ) Accrued expenses ( 2,009 ) 4,082 1,661 Legal settlement accrual 733 3,775 ( 6,120 ) Other current liabilities 3,908 267 ( 446 ) Other non-current liabilities 1,443 2,904 5 Other non-current assets 23 23 ( 266 ) Net cash provided by operating activities 290,023 125,137 33,754 Investing activities Payments for internally developed software costs ( 6,457 ) ( 7,300 ) ( 7,895 ) Purchase of property and equipment ( 317 ) ( 262 ) ( 688 ) Net originations, purchases and collections of ExtraCash receivables ( 195,833 ) ( 111,477 ) ( 62,967 ) Purchase of investments ( 190,012 ) ( 111,311 ) ( 120,016 ) Sale and maturity of investments 189,774 183,652 177,863 Purchase of marketable securities ( 3 ) ( 59,274 ) ( 34,399 ) Sale of marketable securities 100 60,129 33,727 Net cash used in investing activities ( 202,748 ) ( 45,843 ) ( 14,375 ) Financing activities Repurchases of Class A common stock ( 43,730 ) - - Payment for fractional shares on reverse stock split - - ( 12 ) Proceeds from issuance of common stock for stock option exercises 761 1,266 34 Payment of taxes for shares withheld related to net share settlement ( 13,319 ) - - Payment of costs for extinguishment of convertible debt - ( 1,261 ) - Repayment of borrowings on convertible debt, long-term - ( 71,000 ) - Net cash (used in) provided by financing activities ( 56,288 ) ( 70,995 ) 22 Net increase in cash and cash equivalents and restricted cash 30,987 8,299 19,401 Cash and cash equivalents and restricted cash, beginning of the year 51,377 43,078 23,677 Cash and cash equivalents and restricted cash, end of the year $ 82,364 $ 51,377 $ 43,078 86 Supplemental disclosure of non-cash investing and financing activities: Property and equipment purchases in accounts payable and accrued liabilities $ - $ - $ 2 Operating lease right of use assets recognized $ - $ - $ 298 Operating lease liabilities recognized $ - $ - $ 298 Supplemental disclosure of cash paid (received) for: Income taxes $ 5,581 $ ( 109 ) $ ( 586 ) Interest $ 6,933 $ 7,652 $ 8,630 The following table provides a reconciliation of cash and cash equivalents, and restricted cash reported within the consolidated balance sheets with the same as shown in the consolidated statement of cash flows Cash and cash equivalents $ 80,523 $ 49,718 $ 41,759 Restricted cash 1,841 1,659 1,319 Total cash, cash equivalents, and restricted cash, end of the year $ 82,364 $ 51,377 $ 43,078 See accompanying notes to the consolidated financial statements. 87 Note 1 Organization and N ature of Business Organization Dave Inc.
When the Company determines that an ExtraCash receivable is not collectible, or after 120 days from origination has passed, the uncollectible amount is written-off as a reduction to both the allowance and the gross asset balance.
When the Company determines that an ExtraCash receivable is not collectible, or after 120 days from origination has passed, the uncollectible amount is written-off as a reduction to both the allowance and the gross asset balance. Subsequent recoveries are recorded when received and are recorded as a recovery of the allowance for expected credit losses.
The Public Warrants and the Private Warrants have an exercise price of $ 368.00 per share, subject to adjustments and will expire five years after the completion of the Business Combination or earlier upon redemption or liquidation.
The Public Warrants and Private Warrants have an exercise price of $ 368.00 per share, subject to customary adjustments, and will expire on January 5, 2027 ( five years after the completion of the Business Combination), or earlier upon redemption or liquidation in accordance with their terms.
The Company’s policy is to recognize interest expense and penalties accrued on any unrecognized tax benefits as a component of income tax expense within the statement of operations. The Company recognized $ 0.036 million and $ 0.005 million of interest expense and penalties as a component of income tax expense during the year ended December 31, 2024 and 2023, respectively.
The Company’s policy is to recognize interest expense and penalties accrued on any unrecognized tax benefits as a component of income tax expense within the consolidated statement of operations. The Company recognized insignificant amounts of interest expense as a component of income tax expense within the consolidated statement of operations during the years ended December 31, 2025, 2024, and 2023.
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS Report of Independent Registered Public Accounting Firm (PCAOB Firm ID: 34 ) 72 Consolidated Balance Sheets as of December 31, 2024 and 2023 73 Consolidated Statements of Operations for the Years Ended December 31, 2024 and 2023 75 Consolidated Statements of Comprehensive Income (Loss) for the Years Ended December 31, 2024 and 2023 76 Consolidated Statements of Stockholders’ Equity for the Years Ended December 31, 2024 and 2023 77 Consolidated Statements of Cash Flows for the Years Ended December 31, 2024 and 202 3 78 Notes to Consolidated Financial Statements 80 71 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the shareholders and the Board of Directors of Dave Inc.
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS Report of Independent Registered Public Accounting Firm (PCAOB Firm ID: 34 ) 78 Consolidated Balance Sheets as of December 31, 2025 and 2024 81 Consolidated Statements of Operations for the Years Ended December 31, 2025, 2024 and 2023 83 Consolidated Statements of Comprehensive Income (Loss) for the Years Ended December 31, 2025, 2024 and 2023 84 Consolidated Statements of Stockholders’ Equity for the Years Ended December 31, 2025, 2024, and 2023 85 Consolidated Statements of Cash Flows for the Years Ended December 31, 2025, 2024 and 2023 86 Notes to Consolidated Financial Statements 88 77 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the shareholders and the Board of Directors of Dave Inc.
Allowance for Credit Losses ExtraCash receivables from contracts with Members as of the balance sheet dates are recorded at their original origination amounts, inclusive of outstanding processing fees and tips, and reduced by an allowance for expected credit losses.
The Company does not provide modifications to ExtraCash and does not charge late fees. Allowance for Credit Losses ExtraCash receivables from contracts with Members as of the balance sheet dates are recorded at their original origination or purchased amounts, inclusive of outstanding processing fees, overdraft service fees and tips , and reduced by an allowance for expected credit losses.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.
Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks.
The third-party costs are included in the reacquisition price and the gain on extinguishment of $ 33.4 million was calculated as the difference between the net carrying amount of debt and the reacquisition price.
The third-party costs are included in the reacquisition price and the gain on extinguishment of $ 33.4 million was calculated as the difference between the net carrying amount of debt and the reacquisition price. As of December 31, 2025 and December 31, 2024, no amounts remained outstanding under the Note.
The Company’s critical accounting estimates and assumptions are evaluated on an ongoing basis including those related to the: (i) Allowance for credit losses; and (ii) Income taxes.
The Company’s critical accounting estimates and assumptions are evaluated on an ongoing basis including those related to the: (i) Allowance for credit losses; and (ii) Income taxes. Actual results may differ from these estimates under different assumptions or conditions.
The following table presents the assumptions used to value the Founder Holder Earnout Shares liability for the year ended December 31, 2024: Exercise price $ 400 -$ 480 Expected volatility 73.4 % Risk-free interest rate 4.3 % Remaining term 2.01 years Dividend yield 0 % There were no other assets or liabilities that were required to be measured at fair value on a recurring basis as of December 31, 2024 and December 31, 2023 . 101 Note 15 Stockholders’ Equity As of December 31, 2024 , no shares of preferred stock were outstanding, and the Company has no present plans to issue any shares of preferred stock.
The following table presents the assumptions used to value the Founder Holder Earnout Shares liability for the year ended December 31, 2025: Exercise price $ 400 -$ 480 Expected volatility 69.7 % Risk-free interest rate 3.50 % Remaining term 1.01 years Dividend yield 0 % There were no other assets or liabilities that were required to be measured at fair value on a recurring basis as of December 31, 2025 and December 31, 2024 .

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