DAVE - Earnings call transcript Q2 2024

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Operator

Good morning, everyone, and thank you for participating in today's conference call to discuss Dave's financial results for the second quarter ended June 30, 2024.

Joining us today are Dave's CEO, Mr. Jason Wilk; and the company's CFO, Mr. Kyle Beilman. By now, everyone should have access to the second quarter 2024 earnings press release, which was issued yesterday. in Relations available website of is https://investors.dave.com. at release the section Investor Dave's The

call be will replay this addition, In also company's on available website. the webcast for

The comments filings from call Following to uncertainties are webcast as certain are of also statements Securities by not results on Do your well as undertakes reflected company's open XXXX. the could the the place All statements. being adjusted only SEC. required business. EBITDA that the comparable statements, remarks, in SEC no forward-looking any forward-looking Private forward-looking to actual of materially risks forward-looking this subject and measures the or as known the Reform are most management including and questions. financial been call to our supplemental with as of the and assumptions law, reliance date accordance to company's non-GAAP certain statements. Except we'll considered Certain subject measures Litigation made made under and uncertainties update of These described on conference are cause reconciled These differ time that risks performance rules. which directly to of statements revise measures and those measures, other for company Act statements these obligation in have are non-GAAP unknown GAAP call. undue this in forward-looking includes also time with presentation from to forward-looking

over Dave's I turn X-K Wilk. charts and in CEO, furnished the find Mr. would the SEC. to and call Jason reconciliation earnings Form information to important like the now release You'll to other press

begin. may You

Jason Wilk

everyone. Thank and you, morning, good

EBITDA. year-over-year the fifth for to expectations achieving accomplished in accelerating resulted ago consecutive XX% second consecutive year growth, profitability operating in continued period. to adjusted compared revenue expenses quarter which the growth reduce to another This quarter while delivering marks of This managing and revenue third we record materially improved our We quarter, of quarter. outperform the

strong the by in of Given the revenue monthly supported X.X adjusted million are guidance is year-to-date revision members. of further growth for bottom transacting upper end member increasing guidance raising EBITDA and This our continued and for remainder our base, which performance XXXX. we our outlook year, the reached

to Turning to I'd This growth the relationships strategy. Card. on members, about cash continued our deepening efficiently Dave new second extra executing acquiring quarter, progress more like in to our share them the includes through and engaging our

off pattern periods, quarter, at marketing XX% nearly marketing CAC $XX for we demand was we Our we XX% our to spend discuss to while commitment by growth. XX% extra expand investment. spend by as as the On detail period, profitable the investment. pursuit ago year I'll In up level this we in fewer moment. seasonal marketing reduce less capitalize This ramped more relative transaction with driven continue sequential by CAC basis, to X% our acquired the compared to second member paying as members to continue is base year to efficient in but when a acquisition ago member yet in a still of a year-over-year higher reducing of on marketing decrease cash optimize X% in ROI to monthly

impact we customer on As potential we closely its year, costs. navigate an election monitoring acquisition are

sustaining we'll member scale. nears levels efficient higher has environment nor or member return exceed for as at QX While confidence we remain in a to QX, thus investments didn't growth The observe have election QX, our hurdles. ensure acquisition our achieve our marketing of disciplined constructive to we in which remained internal far impacts adds in in

This primary entry focus our engagement has using product X.X member journey. while MTM is our results a members. to growing as greater of growth record extra The cash impressive strategy million XX% second yielded drive with the MTM pillar our of year-over-year to point

member member conversion, to Our member and retention efforts dormant new reactivation contributed this strengthen focused existing growth. meaningfully to

$XXX performance. highlights number the this believe velocity to XX members balance In to seasonally Cash serve Given XX% as quarter we our the equates portfolio continued scale grew and evaluating credit duration, been have to sequentially, year-over-year. underwriting capital-intensive since which million Americans delivered partner have have AI $X.X in everyday softer performance to market by we volume partner rate in base additional just capabilities growth tax well cash sponsor constructive progress. growth, We our of reaching refund QX. basis the improve consecutive over potential reflecting an season the improvement in sponsor discussions extra our growth delinquency origination a increase extra how and consistent is quarter. of receivables the expanding, cash sheet. strong where end. our XX% XX% our down out points compromising totaled X.XX%, the many updates This an in to material of given we growth the a diversify access as and expand for product solid last driven vast our average the for nature on us with Originations size liquidity qualified Dave member cash we we a third and banks for high disbursement relationships. effort accelerate of our opportunity our without to late QX, coming will demand report for banks trajectory. when and key amounts been at thus XX-day for originations period our year been enables billion. net back and Extra us another attractive product, These Despite AI and engine have year-over-year far, allows our quarter continued short without strong cash reputable to need credit

credit has model. strong to within far cash out expect throughout to in engine. performance of we used second We continue in new full this the which the AI rolled underwriting our the quarter's benefit QX, manage also risk new optimizes thus further part because remained underwriting which from data a model quarter, Credit

the strategy final to believe of Xx is to an drive pillar growth required Dave This trial quicker, member in Dave direct an Card for deeper to trust ARPU relationships deposits, through bank us our and engagement. relative Xx non-DT the trial is efficient foster transfer win way with offering to generate higher cash third Dave The extra more the is Card. important which We step cost-effective Card can users. building to to

data year-over-year out volume note, longer for member engagement There Please Dave card we in this Our Card to untapped are MTM to we XX% product. climbing to $XXX reporting be existing million in spending further elevate as no an continued average per incentivize can performance direct with potential second deposit spending quarter. strategically metric from as reach which strong is demonstrate the MTM, banking disclosure is sufficient our we our transaction believe calculated for also proxy on a adoption.

we a in cash in monetization efforts demand season, those yielded as cash, well team dedicated financial year-over-year on the second incumbent as combined lives positive refund XX% typically as during partly those and as seasonally have paycheck to from in ARPU. Card extra their remains strong ARPU increase engagement the extra improvements increased living ARPU paycheck. I extra growth X% our Americans had a majority journey experience to who as well am subscriptions of banking banks, Sequentially, lower extra proud Dave our Dave cash. tax of ARPU served which for quarter including members' impact by serving of cash Card and the and in Dave coming in to out early Our normalized QX both due

will everyday strategic look technology we solidify forward to drive on that, base our premier and as our to and member efficiency. and turn banking We With increasing Our our focus results. expanding for delivering customer Kyle through solution exceptional remains to as our the take position operational members over shareholders leveraging you a disruptive further Americans. Kyle? to financial value, call I Dave's value

Kyle Beilman

Thank good everyone. you, and morning,

and quarter, of further and new believe our AI-enabled during developed growth we we demonstrate key strength high engine metrics. where highlighted, Jason operating We all across represent scalability revenue results our watermarks to substantial remaining As and with disciplined business which the fixed most been underwriting base, accelerating continue by AI DaveGPT. cash our called internally cost achieved by second chatbot our has supported leverage our the

As recall, the guidance on our adjusted may EBITDA strong performance year you raised period. quarter we first full during based that in the

adjusted we of execute year-over-year the enabling EBITDA guidance continued once During second million, XX%. was reached QX full growth a ARPU XX% in raise $XX.X MTMs again the revenue XX% for by and fueled increase. year. quarter, us This representing to expansion well, to

increased our in boosted approximately due basis with engagement year-over-year increased XX% revenue, to the further, QX GAAP our as points utilization basis to marketing up XX% relative allowing increase New as improved a member profit reactivation $XX.X QX ARPU acquisition dollars cash base. million, Card. from margin representing remained retention last X,XXX year. to on Dave while Non-GAAP of and further go to stronger was variable a The both extra well efficient, MTM

optimizing us allowed reduce risk. we loss evaluating AI year. was in variable vendor generate also made improvements which We while performance the margins origination contract and variable per QX progress by our cash the this since unique the in credit The million experience rates sustained XXXX underwriting inception. Our believe the a margin we credit improvement and have of been the we resulting ingested to cash to costs to revenue by has engine, continues of we extra key advantage our loss performance renegotiated have XXX driven over Additionally, transactions and expand has increasing QX extra optimization of competitive continued in in portfolio last cash our largely processing payment bolstered

quarter Now second operating turning to expenses.

approximately time. XX% extra credit by provision grew to X% over $XX.X for decreasing that cash million, losses Our improved, originations year-over-year while

positive As cash fell X.X% in our a system. We the results to AI loss percentage from of year. prior these provisions the X.X% cash underwriting originations, of believe effectiveness the underscore extra

quarters to typically X which we far, to performance on causes which of credit are anticipate and Thursdays percentage our in receivables dollars as the cash the performance, for credit Jason next originations and losses settlements to highest we day QX strong As a are trough cash the causes end. of Extra calendar over going we dynamics weekend remained in which Fridays. extra QX, credit QX to to Typically, and in Mondays to and in our QX relative on which persist noted, cash balance related provision absolute on week Despite forward. increase days, receivables both expect on this the the to disbursements the due conviction have extra Tuesdays. highest cash extra the peak the Fridays,

quarter a correspondingly our those disbursement ends, uncollected cash our into credit for Given is that to purposes financial of delinquency after QX reserve will accounting the higher it's respectively, to charge-off important unrecoverable Tuesday, where extra paid that Monday understand and date. cash originations. in for in adjusting in likely QX drive off develops in and rate, Extra expect charged XX-day relative for or days even other growth a which they performance, the resulting at nature products higher continued a installments. cash in losses. are receivables and balance receivables a since Staying rate are XXX credit how remain for extra off instances revolving multiple on different of advances, on higher for higher receivables topic provision we expectation The for expected balances

that days for The XX-day which charge-offs. pull has For X.XX%, ultimate for the typically is was vintage rate example, more after point that the X.XX%, of vintage that we vintage quarterly XXXX. QX excludes into was recoveries rate the static charge-off recent most the disbursement double-digit of delinquency accounting developed XXX of same fully percentage generate since and quarterly or

in clarify as extra receivables, financial revolving $X.X make out for evolving track While paid big installments, our would performance to this misleading the principal gross are a our optimizing evaluating us gross servicing to repayment. or static reliable million pool help the economics. whereas balance, QX installment-based are case which credit persist multiple The way with increased credit products, receivables This the the all cash a management to year-over-year million the view ago more gross or fall within is approach receivables cash, which involves portfolio for extra are implies product used of that and that receivables Processing make remaining charge-offs those to assessing single of balance. continue the sense $X.X we year model repayment for be can in a to X% period. costs we single such may and believe compared risk balance, progress in and should relative which products,

marketing achieve another spend. of efficiency originations to the generating improved percentage able anticipate increased demand in of in the we growth to our million million were However, This volume, to QX origination and capitalize to that MTM compared decreased prior operating as and at efficiency year on $XX. to XX% X.X%, the XX% same investments. decrease We investments demonstrating in strong approximately costs reflected these to CAC marketing CAC levels our aspect over X.X% $XX.X is the returns from to year-over-year $XX period. attractive costs as LTV of a goals lower as Advertising XX% we're experiencing year-over-year those we're on increasing in period

compensation Now headcount. and looking at

in the year grew expenses to compensation-related by QX $XX.X million Our million $XX.X prior period. in from X%

operating second declined legal million the the XX% in from that Other model expense year ago in from $X.X XX%, to leverage the expenses in in made year settlement-related from to a have in we $XX the approximately due inherent quarter as expense a million to XX% million platform. operating decreased our period, the period. largely revenue, $XX.X ago percentage business compensation underscoring our technology investments However, further of resulting

certain onetime this business to improved other to $XX.X for Beginning or the EBITDA an million as fair $XX.X adjusted FTX as to XXXX expenses losses compared quarter. million $XX.X noncash modestly or GAAP second grew as adjusted of the loss adjusted gain started for million discounted the net EBITDA a quarter was stock-based which this income overall convertible the to well during the the period. changes $X.X income adjusts loss gains a net the of ago QX of liabilities million operating that of in $XX.X in compared the for GAAP quarter second Adjusted net for we quarter $XX.X impact, of year as income such million year, or $XX net in GAAP on first disclosing net Excluding of value loss an result during the of context, compensation, note net any With second repurchase our million prior period. income growth. loss year loss, to was XXXX. compared million adjusted

operating We this leverage. improvement revenue continue growth, expansion, combination to and to margin of a attribute efficiency, CAC improved

XX% QX. for from Our quarters has with adjusted X driven profitability execution consistent consecutive increase EBITDA a sequential

as EBITDA Looking as ahead, timing we make expect may trajectory quarter-end of in plan marketing profitability, investments increases moment to the half the continue losses to we though to ago. opportunistically the dynamics given the grow nonlinear be back a year, adjusted I and provision for credit mentioned

to turning sheet. the balance Now

the quarter XX, quarter. $XXX.X and at investments had million end restricted June in securities, of driven equivalents, extra approximately of as cash end in receivables of to decrease originations period. million last and to increase As of outstanding cash marketable $XX.X higher an cash The cash compared in cash the by was advanced due we

to on going million, as with think during to credit we to net full EBITDA our to compares year our this quarter, consecutive ample versus to $XX QX full QX our $X.X of end million. positioned the provided we the forward. $XX extra the $XX rely guidance growth $XX to at $XX to are We're underscores to of million. on original the $XX last positive, of guidance we quarter to about $XX.X our between million adjusted our continue $XX And the originations, start range outlook turning this approximately billion million we at year originations receivables important bottom of our of sheet $XXX million efficiency, the as end liquidity to profitability, And With raising the and a relative guidance growth million, success. volume origination regards the of second strong XX% balance end receivables year revenue our fund we for we back an facility. to the million guidance of velocity sheet, quarter million believe XX% of range with million by plan of credit a to grow sequentially. of it and we cash our the representing compared to extra are This guidance. million balance continued the balance full of It's to of the that, of remained for increase The to XXXX drawn well believe have and remains As year $XXX our conclude now given high Overall, to capital execute our our million we and the will during I on hand raising ability as net was facility our XXXX. portfolio. between duration our amount to Jason $XXX.X call. short believe cash balance cash Overall, quarter to continue second over to $X

Jason Wilk

Our continued new growth continue open for questions. our strong XXXX quarter this confident will to in team positive we the company. our achieve Operator, performance that can call milestones I'm beyond. and and trajectory the drive now reinforces of

Operator

[Operator first will coming question Devin Instructions] our be Ryan And Citizens from of JMP.

Devin Ryan

obviously, quarter, then be I XX% sequentially, in both extra cash was like the there higher really driven this this step-up quarter, XX% a looks but year-over-year. average second volume seasonal more nice it can So bump advances. originations and know in by up

with the up size color right great ability a base get So now broadly, advance trends average comfort then customer here? the and you're around to to and seeing take just the from little your more more higher

Kyle Beilman

we're demand just the we're overall about good I'd feeling really dynamics seeing. say, that overall,

seeing in ramp-up member marketing retention respect of think multiyear our favorable despite spend costs reactivation in sequentially. customer you see customers. can and acquisition at existing with also dormant the trends We're as really lows I to were

solid year. demand it's point a just second and this the of think really at the patterns lot going confidence looking So into the are gives of overall us half I

forward, and allows we In overall loss us feel that a ability well have quarter very to comfortable to the up as our both origination model as second in that there. to to there second to move We feel run of still Devin, rate rest therefore, because add going upside moving nature size half room think product. And size out real that to further terms high we're this there we of able quick, as year. is continue lower rolled average in new monetization through I do the to increase the the into and we ramp advanced of velocity lean that and the of that to performance, just the we're

you As cash actually flow average around people know, is days. the amount XX use

able to those models. we're test learn so new And and on

So rapidly to quickly lot that time providers of a a compared credit we season. traditional their can with to so gain long have to vintages wait confidence that

Devin Ryan

a then announced the in question And on CFPB July. proposal

to You out. how COPD, if talking like a Street positive. around see are really to position, release the you obviously But press the Journal large Wall the early for scenario that. be impact in so fees about all issued It a were hand, framework And feels one if have to and to industry. play on which I out could changes overdraft regulatory July, it we'll we your on was a there think an overdraft have plays banks the lower where there article have

in recent the color love then proposal, get more to marginal of on seem a the would I'd squeeze there. little a maybe space. players number So to it But

is pricing love some extent elasticity and disposal monetization of just of around there the think about to the at on maybe model, just front. levers any I that So the changes then to the your

and a on both on on there's now. think since I the business market lot touch for pack right maybe implications So proposals the the

Jason Wilk

of mentioning compared a account. how how out there, you're fees. sit proposed with that regulation, to a just lower By make checking And the on $XXX per supplement, first our cost So charge they think as spot bank. first we even have means a much to around our balance for our break calculation, it article to the specifically minimum overdraft basic on pointed Wall part bank given fees we about to time break operate, have just even the certain account. traditional really the Journal for a which Street overdraft up to lower Therefore, that it's cost to year references checking serve our good serve for in banks we on to amount major is cost in they a to much

in And if away were so have different overdraft up or be limited, significantly prices to go to areas. go

on have puts significant we And great continuing that still fees, think gross cost have lower have lower to as a in lean so yet advantage margins we us serve to in to today. our

our we're spent banks, that On did similar not I as the building feel we there and were unlicensed compliant business of fees. a subject were is we position is proposed to yes, statement that EWA, agree players up to the public. cheaper to very very don't that become time it leading this pass, an If that out role. could federally credit offer effective, And way squeeze to traditional it we to and in going significantly at our regulated product, a lot overdraft strongly yes, continuing believe a developing albeit regulated. issue are a some Dave if to overdraft we product in rule

Devin Ryan

that potentially just maybe the that you wouldn't levers other well elasticity I think world the plays in price here, just So that of model as the static. business too, the can And on around platform? overall there's stay

Kyle Beilman

here. Just to in jump

a standpoint. have have evolving we I pricing for we've And I that shown to the landscape, and shown offer. is from that evolve pay is given our we the results flexibility, we think willingness what what high what need that we're doing should a to there customers from think product

we just within regulatory call increased. size. that regardless And fact think operate of can to the happens X are broader just of to that the we past, continue what customers it, over also seen that trends the has ramp a effectively to we're up I landscape. points willing Monetization quarters gives lot what as that ARPA to And me the confidence we've that for offering. origination to pay So back point continue

Jason Wilk

we to and our fee Yes. continue discharge always a pressed there, like significantly model, the say lower fees today incumbent. should we move to banks structure, fee our do I just that could similar than to we to but can we which in would add with model the optionality on within mandatory be traditional

So either way, to flexibility ARPU think to lot we moving there's a pricing desired which our level, feel confident of reach in continue we very forward. the

Operator

will next Cantwell our from Seaport Research. of coming Jeff And question be

Jeffrey Cantwell

medium-term These are questions.

When revenue you above It what of but growth, on bit is to positive First, here, that thoughts the sustainable Second further EBITDA. how it, the below, was revenue very on XX% are expectation. this in also about out call second quarter we the adjusted came business remainder XX% can we thinking your a about quarter Can you're talk drill profitable EBITDA. little growth, is you're looks year. see XX talking adjusted expenses again, down, the like there?

call several sustainable how you of it is you adjusted EBITDA there? the callouts the and it, understand major terms in are next, positive us can quarters, think over help So what

Jason Wilk

in So I feel many years Jeff, our to to ability XX%-plus deliver confident continue and think quarters come. growth look, for to hopefully, very we

as at We company that XX-plus well. but and And levels trajectory quarter percent the CAC to for was the levels at very continue we continue hope can growth We're not to healthy supported feel that. these by our so XX% tremendous. committing a low the growth,

continued Kyle in EBITDA to trends on plan some company, the positive we think and do I to any mentioned positive company where marketing forward here on increased take advantage as script continue that there far that moving marketing a may capital. fluctuations additional as have in based may As that the maintain take we to EBITDA, to access to advantage demand. of overall, some the want of out EBITDA on be we But not

Jeffrey Cantwell

on the revenue forward. viewing in bank that going supposed optionally maintained about talk things to are profitability, your to be be Dave clearly and X just discuss how is in going first plan to are you order Evolve your

in Evolve. something contingency that about place change your finding over Maybe happen talk in on that bank to would comment with whether you can event any relationship. would time So new there's relationship partners plans the

Jason Wilk

Yes.

are approached very there. the report partner we ongoing in qualified at sponsor are note firms. our conversations attractive are are made opportunity established of partner There our negotiations. banks on that very compliance we be them are many that partner, when evaluating to we attractive bank back new call that noted that want And We this we've just risk for well second that these I we we'll to So because several an material have a point. a of and out think suited us of the and progress for programs, feel

Kyle Beilman

order And just say still to consent and impacted is with would business. some positive as Evolve happened our the there jump Nothing it challenges in what there, with that relationship facing the I also healthy. of just and our about other that they're

work team over continuing in close their there a and have partnership. to leadership positively are that relationship We with

really mitigation about bank has date. taking, capacity to risk the So business impacted been is we're any step in the a nothing that second just but

Jason Wilk

been recent These last add year. stemmed just that time. from some is quite reactionary would for I conversations from nothing the news. most the has And part mitigation the plan bank have risk This of

customer in paying reached noted up at we As of scale a right some case. decision the members, risk we've redundancy have X.X call, this just to point million for and the in significant set it's

Jeffrey Cantwell

Devin's over are Can is those follow-up for comment PIPs what your in question. color on It focus, like on the are in like areas on regulation, us out costs CFPB's then seems play focus. time? all-in your coming position and of again, terms areas just you the lastly, might into yourselves how that can ruling. some certain On a more give And thoughts about you

Jason Wilk

confident offering banks major overdraft They an feel also are we how program are set have. as an well. and program offering Look, within in similar the product we up to keep we completely the fees ability as overdraft our overdrafts optional, to as they're that

several So apply people way that last much approval such because of your has are in does pay firms seem have you time, on at afford ahead to that to condition have out when we actually the forcing an we they credit do because which seeing based optional can't. mostly There approved nothing regulation don't on some never business. great are a think fan there as piece to and shipping this can ruling your disappointing tipping various tipping We around on been that and for how that access of tipped customers, I'm people around or for the being and free disclose think aimed choose many to a tip they us. callout as state credit done when require it we customers is there activity, it is they a can which monetize is is you so

Operator

from Capital next Our of question Street Jacob be will coming Markets. Lake Stephan

Jacob Stephan

wanted effectiveness the the And you just said you're it seeing adds? to guys differently the obviously, here with costs. that any that you're that in start is impact doing not election. maybe out from customer customer acquisition I cost to see But what new

Jason Wilk

the Well, been the form we business. our since of trajectory of see of largest That's mouth. word acquisition positive beginning are continuing to in our a

word-of-mouth well also see were the company, we on distribution. our doing focused just We of very of across In channel couple a that digital in channels. we're the quite beginning

streaming, TV, affiliate. from everywhere are social search channels, all we Now the

us not for have stage. this very moving reduction given forward a of company our typical CAC, this of it's dollars, and distribution We confidence in of growth spend a which healthy seeing a marketing lot all at with is to

Jacob Stephan

us think elevated the could but marketing help here, increase. I in spend, maybe pointed the of of Kyle, we that you size magnitude out some kind And see maybe, QX

Kyle Beilman

marketing healthy XH trends But Yes. anything our rest hope wouldn't message haven't range, gross answer spend of think on the really to attractive saw around I'd there. overall, year a QX we're we X-month we're the expect just Look, in I overly is to that attractive, They're to question. as that work with quarterly decision-making relative payback point. just sequential with the calendar returns just the driving drive what XH. CAC last a guidance profit on the this periods the and least just to consistent helps more summer on dramatic, into maybe what at I spend. to I but over elevated from through level be marketing really or periods just X- ramping, our leaning specific provided we of basis basis as environment we on QX, the advantage demand say at taking your attractive that of LTV increasing the that to seeing, our go-to-market opportunity what's will

Jacob Stephan

here. Just the know there been but on Maybe color this I give us just plans. be more update in helpful. me on the the has a past, one pricing one last would updated subscriber focus for any some

Jason Wilk

We're It's in update. and a test the modeled a official not any important it's any our guide no full that evaluating results timeline rollout. firm for in upside. have of to it's still don't though So not note

to continuing we're So nothing test, but firm.

Operator

Barrington. And Gary from be coming Prestopino our will next of question

Gary Prestopino

of of terms a maybe improvement? Jason, seeing rate discuss couple you you're and there in Card what year-over-year cash here. questions extra Could Dave the of terms of to in the attach the sequentially out

Kyle Beilman

we opportunity this our increase that just quarters we've to relatively year further say, over rates And there, as Dave our card view that product rate against have direct the what volume But help don't disclose within drive consistent, the last been is development the attach this EC X further explicitly. is we of being to XX% attach I'd X to sent opportunity well some that there's drive of penetration last roughly seen MTM base. quarters. It's do adoption Card. as later Debit from the stacked deposit overall handful there we So which hope an over to

So there roughly the attach XX%. to more yes, rates performance strategy this hopefully, that are But year. some later on and come

Jason Wilk

that those we on Card when Dave customers. the do do customers does see retention up definitively And go to attach that

ways is there, strategy and playing our find we to more want get well out card to adopt to and deposit. then ultimately direct So people the

Gary Prestopino

obviously, And commensurate but up, retention should going well, correct? as is rise transaction

Jason Wilk

Transactions ARPU. overall and

lifetime opportunity for it's it to a So increases us really from after monetization as and a go tension standpoint. healthy value just both

again, have stacked some that and So that development optimistic about. later yes, product focused we're against year this something really on we're

Gary Prestopino

of Dave Could Card? paychecks progress direct to on you on also comment deposit your the

Jason Wilk

We of is direct to disclose that a us trial penetration. the good good metric against extra a doing on Card initial total and transaction drive higher a model Dave don't way there's to deposit room But cash that for We see run card feel still. ultimately, to how doing that to we're adding on growth percentage deposits monitoring you from up of see would be proxy monthly a Dave as direct keep to total just how in direct people we're deposit spend. Card

Gary Prestopino

you us benefiting know talk new but what going you're new where just underwriting directionally, I did, to you proof model lastly, about this model tell a talked directionally, not the about ratios. out of exactly your can are you points you? then that's rolling And loss improved

Jason Wilk

mean just Gary. XX-day rate Yes. shows it our loss think in up I I performance,

which As portfolio. the we you loss to economics drive drive those can see, continue the rates, ultimately down just of year-over-year,

both the as and as in both It's rates. we're average really by able So further equation revenue origination to rising XX-day charge-off in that per of model. ultimately, the XXX-day loss drive well the equation context reduction as rate, a there powerful sides the the of our optimizing

the to So the strategy as doing how effectiveness we're of team. and I'd of from execution the points point the those and proof the

Gary Prestopino

you've the I trying this. maybe idea what you at doing, is I'm of changed guess to to how us question, I asked give an what you're about Can focus tweaked the in Yes, get talk just of that? Ron. what's

Kyle Beilman

all that at better point share just us more the I say into more data points. portfolio. the split model, this risk willing to it's I'd new addition the just allow substantially say of points points I'd added within of We've just data that's into data we're the model. think is introduction overall the to just

Jason Wilk

to say, approach, I'd more the add model robust largely Sorry, comprehensive just a just the prior that. to It's same versions. and versus Gary,

Gary Prestopino

giving discussions were the the you rating in at with more think I who risk that then bites higher individuals extra testing you And credit parameters, have with apple cash. for

that I to working? tell starting X gain traction allowed little every bit think a or can is Is us of testing X you're how you weeks. that

Jason Wilk

Yes.

seeing initiative to customers of our is those a We're they but assets bit as levels use our credit proxy we've don't increased credit score our give highest-quality if that ARPU the additional data quite their giving working it and were on retention. period, customers So higher-- transaction paycheck an we to had here increased ongoing internal scoring and same well. within need a little on that based

that's to overall, origination just that been size Yes, I XXX% think origination Gary, per a average plan hopefully, a is impact rollout. the to what the be So do yet per We're not would to customer point, great higher by so revenue we expect it's average to well. up We strategy. the of driving and year. just, end as

from upside there. just So monetization a standpoint

Operator

the as program. this And today's a concludes question-and-answer have well session Everyone, as day. great

You disconnect. may now

Dave (DAVE) 6 Aug 242024 Q2 Earnings call transcript