Chime Reports Q1 Revenue of $528mln, a 37% YoY Increase

Chime, a neobank fintech, reported Q1 revenue of $528 million, a 37% increase YoY. CEO Chris Britt attributed the growth to increased tax refund activity and re-engaged active members. Despite not being a bank, Chime's lack of brick-and-mortar locations is seen as a competitive advantage. The company serves 8.7 million active members, with 67% relying on Chime for their primary financial relationship. Net income was -$923 million, and diluted EPS was -$7.29, due to stock-based compensation expenses. Chime's stock fell 14% in trading.

Chime, a prominent neobank fintech, reported its first quarterly earnings as a publicly traded company, revealing a 37% year-over-year (YoY) increase in revenue to $528 million. The company attributed this growth to an acceleration in tax refund activity and an increase in re-engaged active members [2].

CEO Chris Britt highlighted that Chime's digital platform allows it to scale services efficiently without the need for substantial infrastructure investments. This advantage is particularly evident in the company's ability to serve 8.7 million active members, with 67% of them relying on Chime for their primary financial relationship [2].

Despite the impressive revenue growth, Chime's net income for the quarter was -$923 million, and diluted earnings per share (EPS) were -$7.29. These losses were primarily due to one-time stock-based compensation expenses and related payroll taxes resulting from the company's initial public offering (IPO) [2].

Chime's stock experienced a significant drop of 14% in trading following the earnings report. The company, however, remains optimistic about its future prospects, guided by expectations for full-year revenue between $2.135 billion and $2.155 billion, and adjusted EBITDA of $84 million to $94 million [1].

References:
[1] https://seekingalpha.com/news/4482531-chime-financial-shares-dip-after-inaugural-quarterly-earnings-after-ipo
[2] https://www.americanbanker.com/news/chime-reports-first-earnings-since-ipo