Raises 2023 Guidance for Non-GAAP Revenue, Non-GAAP Variable Margin and Adjusted EBITDA, Implying Adjusted EBITDA Profitability in Q4 2023 at the Midpoint of the Range
Q3 GAAP Revenue up 7% Q/Q to
Q3 Net Loss Improves by 47% Q/Q; Adj. EBITDA Loss Improves 81% Q/Q to
“Last year we made the commitment to grow our way to profitability by focusing on expanding member lifetime value, increasing variable margins, and making disciplined investments in marketing, while driving operating leverage from our scalable cost structure,” said
“Our positive outlook for growth, combined with the sustainable improvements we’ve made to our business model, has us tracking well to achieve the critical milestone of turning Adjusted EBITDA profitable in the fourth quarter of this year, well ahead of expectations.”
Quarterly Financial Highlights ($ in millions)
3Q22 | 4Q22 | 1Q23 | 2Q23 | 3Q23 | |
GAAP Operating Revenues, Net | |||||
% Change vs. prior year period | 41% | 45% | 38% | 34% | 16% |
Non-GAAP Operating Revenues* | |||||
% Change vs. prior year period | 41% | 46% | 39% | 33% | 15% |
Non-GAAP Variable Profit* | |||||
% Change vs. prior year period | 24% | 26% | 91% | 78% | 51% |
Non-GAAP Variable Profit Margin* | 42% | 41% | 56% | 53% | 55% |
GAAP Net Loss | ( | ( | ( | ( | ( |
Adjusted EBITDA (Loss)* | ( | ( | ( | ( | ( |
*Non-GAAP measures. See reconciliation of the non-GAAP measures at the end of the press release.
Third Quarter 2023 Operating Highlights (vs. Q3 2022)
- New Members totaled 821,000 while customer acquisition cost decreased by 30%
- Monthly Transacting Members (“MTMs”) increased 6% to 1.9 million. Transactions per MTM increased 39% to 6.4
- ExtraCash originations increased 23% to
$932 million , while the 28-Day delinquency rate improved 165 basis points to 2.42% - Dave Debit Card spend increased 73% to
$341 million compared to$197 million - For a full review of the Company’s KPIs, please refer to the Company’s Q3 2023 Earnings Presentation which can be found here
Liquidity Summary
The Company had
Raising 2023 Financial Guidance
($MM) | Prior FY 2023 | New FY 2023 |
Non-GAAP Revenue* | ||
Year-Over-Year Growth | 11% - 23% | 22% - 24% |
Non-GAAP Variable Profit Margin* | 47% - 51% | 53% - 54% |
Year-Over-Year Improvement | 600bps - 1,000bps | 1,200 - 1,300bps |
Adjusted EBITDA* | ( | ( |
Year-Over-Year Improvement | 43% - 60% | 75% - 80% |
*Non-GAAP measures. See reconciliation of the non-GAAP measures at the end of the press release.
Dave CFO
“During the quarter, we finalized an amendment to our credit facility which provides more leverage, capacity, and term at a lower cost despite tighter capital markets conditions. This amendment is a direct reflection of our lender’s confidence in Dave’s unit economics and the strength of our business moving forward.”
Conference Call
The Company will host a conference call at
Date:
Time:
Dial-in registration link: here
Live webcast registration link: here
The conference call will also be available for replay in the Events section of the Company’s website, along with the transcript, at https://investors.dave.com.
If you have any difficulty registering for or connecting to the conference call, please contact Elevate IR at DAVE@elevate-ir.com.
About Dave
Dave (Nasdaq: DAVE) is a leading
Forward-Looking Statements
This press release includes forward-looking statements, which are subject to the “safe harbor” provisions of the
Non-GAAP Financial Information
This press release contains references to Adjusted EBITDA, non-GAAP operating revenues, non-GAAP variable operating expenses, non-GAAP variable profit and non-GAAP variable profit margin of Dave, which are non-GAAP financial measures that are adjusted from results based on generally accepted accounting principles in
These non-GAAP financial measures may be helpful to the user in assessing our operating performance and facilitate an alternative comparison among fiscal periods. The Company’s management team uses these non-GAAP financial measures in assessing performance, as well as in planning and forecasting future periods. The methods the Company uses to compute these non-GAAP financial measures may differ from the methods used by other companies. Non-GAAP financial measures are supplemental, should not be considered a substitute for financial information presented in accordance with GAAP and should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP.
Refer to the section further below for a reconciliation of these non-GAAP financial measures to their most directly comparable GAAP measures for the three and nine months ended
Certain Other Terms
Dave defines Net New Members as the number of new Members who join the Dave platform in a given period by connecting an existing bank account to the Dave service or by opening a new Dave Banking account, net of the number of accounts deleted by Members or closed by the Company in the same period. Total Members is defined as the number of unique Members that have either connected an existing bank account to the Dave service or have opened a Dave Banking account, less the number of accounts deleted by Members or closed by Dave, as measured at the end of a period. The number of Monthly Transacting Members represents the unique number of Members who have made a funding, spending, ExtraCash or subscription transaction within a particular month, measured as the average over a given period. Transactions Per Monthly Transacting Member measures the average number of transactions initiated per Monthly Transacting Member in each month, measured as the average over a given period.
Investor Relations Contact
Elevate IR
DAVE@elevate-ir.com
Media Contact
press@dave.com
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||
(in millions) | ||||||||||||||||
(unaudited) | ||||||||||||||||
For the Three Months Ended | For the Nine Months Ended | |||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||
Operating revenues: | ||||||||||||||||
Service based revenue, net | $ | 59.2 | $ | 52.8 | $ | 166.7 | $ | 135.1 | ||||||||
Transaction based revenue, net | 6.6 | 4.0 | 19.3 | 10.1 | ||||||||||||
Total operating revenues, net | 65.8 | 56.8 | 186.0 | 145.2 | ||||||||||||
Operating expenses: | ||||||||||||||||
Provision for credit losses | 16.0 | 18.4 | 43.9 | 46.0 | ||||||||||||
Processing and servicing costs | 7.1 | 9.5 | 21.4 | 23.6 | ||||||||||||
Advertising and marketing | 13.9 | 24.1 | 38.4 | 57.1 | ||||||||||||
Compensation and benefits | 23.1 | 24.3 | 71.4 | 81.3 | ||||||||||||
Other operating expenses | 16.3 | 18.4 | 54.8 | 50.8 | ||||||||||||
Total operating expenses | 76.4 | 94.7 | 229.9 | 258.8 | ||||||||||||
Other (income) expenses: | ||||||||||||||||
Interest expense, net | 1.7 | 1.3 | 5.0 | 4.4 | ||||||||||||
Legal settlement and litigation expenses | — | 6.8 | — | 6.8 | ||||||||||||
Other strategic financing and transactional expenses | — | 2.2 | — | 5.0 | ||||||||||||
Changes in fair value of earnout liabilities | — | — | — | (9.6 | ) | |||||||||||
Gain on extinguishment of liability | — | — | — | (4.3 | ) | |||||||||||
Changes in fair value of derivative asset on loans to stockholders | — | — | — | 5.6 | ||||||||||||
Changes in fair value of public and private warrant liabilities | (0.2 | ) | (0.7 | ) | (0.2 | ) | (14.2 | ) | ||||||||
Total other expense (income), net | 1.5 | 9.6 | 4.8 | (6.3 | ) | |||||||||||
Net loss before provision for income taxes | (12.1 | ) | (47.5 | ) | (48.7 | ) | (107.3 | ) | ||||||||
Provision for income taxes | — | — | — | 0.1 | ||||||||||||
Net loss | $ | (12.1 | ) | $ | (47.5 | ) | $ | (48.7 | ) | $ | (107.4 | ) | ||||
RECONCILIATION OF OPERATING REVENUES, NET TO NON-GAAP OPERATING REVENUES | ||||||||||||||||
(in millions) | ||||||||||||||||
(unaudited) | ||||||||||||||||
For the Three Months Ended | For the Nine Months Ended | |||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||
Operating revenues, net | $ | 65.8 | $ | 56.8 | $ | 186.0 | $ | 145.2 | ||||||||
ExtraCash origination and ATM-related costs | 1.5 | 1.8 | 4.4 | 4.1 | ||||||||||||
Non-GAAP operating revenues | $ | 67.3 | $ | 58.6 | $ | 190.4 | $ | 149.3 | ||||||||
RECONCILIATION OF OPERATING EXPENSES TO NON-GAAP OPERATING EXPENSES | ||||||||||||||||
(in millions) | ||||||||||||||||
(unaudited) | ||||||||||||||||
For the Three Months Ended | For the Nine Months Ended | |||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||
Operating expenses | $ | 76.4 | $ | 94.7 | $ | 229.9 | $ | 258.8 | ||||||||
Non-variable operating expenses | (46.4 | ) | (60.8 | ) | (143.8 | ) | (171.3 | ) | ||||||||
Non-GAAP variable operating expenses | $ | 30.0 | $ | 33.9 | $ | 86.1 | $ | 87.5 | ||||||||
CALCULATION OF NON-GAAP VARIABLE PROFIT | ||||||||||||||||
(in millions) | ||||||||||||||||
(unaudited) | ||||||||||||||||
For the Three Months Ended | For the Nine Months Ended | |||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||
Non-GAAP operating revenues | $ | 67.3 | $ | 58.6 | $ | 190.4 | $ | 149.3 | ||||||||
Non-GAAP variable operating expenses | (30.0 | ) | (33.9 | ) | (86.1 | ) | (87.5 | ) | ||||||||
Non-GAAP variable profit | $ | 37.3 | $ | 24.7 | $ | 104.3 | $ | 61.8 | ||||||||
Non-GAAP variable profit margin | 55 | % | 42 | % | 55 | % | 41 | % | ||||||||
RECONCILIATION OF NET LOSS TO ADJUSTED EBITDA | ||||||||||||||||
(in millions) | ||||||||||||||||
(unaudited) | ||||||||||||||||
For the Three Months Ended | For the Nine Months Ended | |||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||
Net loss | $ | (12.1 | ) | $ | (47.5 | ) | $ | (48.7 | ) | $ | (107.4 | ) | ||||
Interest expense, net | 1.7 | 1.3 | 5.0 | 4.4 | ||||||||||||
Provision for income taxes | — | — | — | 0.1 | ||||||||||||
Depreciation and amortization | 1.4 | 2.4 | 3.7 | 5.1 | ||||||||||||
Stock-based compensation | 6.7 | 8.0 | 20.1 | 34.1 | ||||||||||||
Legal settlement and litigation expenses | — | 6.8 | — | 6.8 | ||||||||||||
Other strategic financing and transactional expenses | — | 2.2 | — | 5.0 | ||||||||||||
Changes in fair value of earnout liabilities | — | — | — | (9.6 | ) | |||||||||||
Gain on extinguishment of liability | — | — | — | (4.3 | ) | |||||||||||
Changes in fair value of derivative asset on loans to stockholders | — | — | — | 5.6 | ||||||||||||
Changes in fair value of public and private warrant liabilities | (0.2 | ) | (0.7 | ) | (0.2 | ) | (14.2 | ) | ||||||||
Adjusted EBITDA | $ | (2.5 | ) | $ | (27.5 | ) | $ | (20.1 | ) | $ | (74.4 | ) |
LIQUIDITY AND CAPITAL RESOURCES | ||||||||
(in millions) | ||||||||
(unaudited) | ||||||||
2023 | 2022 | |||||||
Cash, cash equivalents and restricted cash | $ | 44.8 | $ | 23.7 | ||||
Marketable securities | 1.6 | 0.3 | ||||||
Short-term investments | 124.6 | 168.8 | ||||||
Working capital | 243.5 | 272.2 | ||||||
Total stockholders’ equity | 79.2 | 106.6 |
Source:
2023 GlobeNewswire, Inc., source