What changed in this filing

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Item 2. Management’s Discussion and Analysis

2025-11-10 compared with 2025-08-11 · 108 added, 92 removed, 303 unchanged (40% of the section changed)

3 unchanged sentences

This discussion contains forward-looking statements that involve risks and uncertainties.

Factors that could cause or contribute to such differences include those identified below and those discussed elsewhere, particularly in the sections titled “Risk Factors” and “Special Note Regarding Forward-Looking Statements.” Financial data as of and for the three and six months ended June 30, 2025 and 2024 has been derived from our unaudited condensed consolidated financial statements appearing at the beginning of this Quarterly Report on Form 10-Q.

Factors that could cause or contribute to such differences include those identified below and those discussed elsewhere, particularly in the sections titled “Risk Factors” and “Special Note Regarding Forward-Looking Statements.” Financial data as of and for the three and nine months ended September 30, 2025 and 2024 has been derived from our unaudited condensed consolidated financial statements appearing at the beginning of this Quarterly Report on Form 10-Q.

Our historical results are not necessarily indicative of the results that may be expected for any period in the future.

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Through our direct relationships with FDIC-insured bank partners, we deliver products that address the most critical financial needs of everyday people across spending, saving, accessing liquidity, and building credit, all while avoiding punitive fees.

Through our broad suite of products, we have built trusted relationships with 8.7 million Active Members as of June 30, 2025.

Through our broad suite of products, we have built trusted relationships with 9.1 million Active Members as of September 30, 2025.

The majority of our Active Members rely on Chime to serve as their primary financial relationship, which we believe are the most valuable relationships in consumer financial services.

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We received net proceeds from the IPO of $770.6 million after deducting underwriting discounts and offering costs.

In connection with the IPO, 32,182,289 shares of our Class A common stock owned by Christopher Britt, our co-founder, Chief Executive Officer and Chair, and Ryan King, our co-founder and a member of our board of directors (our “Co-Founders”) and their related entities were exchanged for an equivalent number of shares of Class B common stock.

In the second quarter of 2025, we recognized a total of $928.1 million in stock-based compensation expense and related payroll taxes, of which $885.8 million was stock-based compensation expense associated with RSUs, including $10.6 million related to performance-based and $4.2 million related to market-based PSUs, as a result of the satisfaction of the liquidity-based vesting condition upon the effective date of the Registration Statement on Form S-1 filed in connection with our IPO.

To meet the related tax withholding requirements for RSUs settled, we withheld 11,948,867 of the 25,352,450 shares of Class A common stock issuable to holders of vested RSUs.

Based on the IPO price of $27.00 per share, the tax withholding obligation was $322.6 million, which was paid within the quarter.

In connection with the IPO, 32,182,289 shares of our Class A common stock owned by Christopher Britt, our co-founder, Chief Executive Officer and Chairman, and Ryan King, our co-founder and a member of our board of directors (our “Co-Founders”) and their related entities were exchanged for an equivalent number of shares of Class B common stock.

Key Metrics and Non-GAAP Financial Measures

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Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(in millions) 2025 2024 2025 2024

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Three Months Ended

September 30,

(in millions, except for Average Revenue per Active Member) 2025 2024

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Non-GAAP Financial Measures

To supplement our consolidated financial statements prepared and presented in accordance with GAAP, we use certain non-GAAP financial measures, as described below, to facilitate analysis of our financial trends and for internal planning and forecasting purposes.

To supplement our condensed consolidated financial statements prepared and presented in accordance with GAAP, we use certain non-GAAP financial measures, as described below, to facilitate analysis of our financial trends and for internal planning and forecasting purposes.

We use transaction profit, transaction margin, adjusted EBITDA, and adjusted EBITDA margin in conjunction with GAAP measures to evaluate our operating performance, formulate business plans, prepare budgets and forecasts, and make strategic decisions, including those relating to operating expenses and the allocation of internal resources.

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Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(in thousands, except percentages) 2025 2024 2025 2024

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We have increased our adjusted EBITDA margin as a result of Active Member and Purchase Volume growth, realized operating leverage through increased scale, and from efficiently managing our operating costs.

The following table presents a reconciliation of net income (loss) to adjusted EBITDA for each of the periods indicated:

The following table presents a reconciliation of net loss to adjusted EBITDA for each of the periods indicated:

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(in thousands, except percentages) 2025 2024 2025 2024

Net income (loss) $ (923,376) $ 385 $ (910,437) $ 16,288

Net loss $ (54,722) $ (22,026) $ (965,159) $ (5,738)

Net margin (10) % (5) % (61) % — %

3 unchanged sentences

(10,268) (10,817) (21,837) (31,230)

Provision (benefit) for income taxes (1,047) 78 505 (284)

Provision for income taxes

280 2,199 785 1,915

Stock-based compensation expense and related payroll tax

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Stock-based charitable contribution expense

11,168 — 11,168 —

Adjusted EBITDA $ 28,757 $ (13,613) $ 69,851 $ 4,923

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We earn platform-related revenue from other products offered to our members that provide additional convenience, financial management tools, and access to liquidity.

These products include access to ATMs, MyPay, high yield savings, third-party partnerships, SpotMe, and cash deposits.

These products include access to ATMs, MyPay, outbound instant transfers, high yield savings, third-party partnerships, SpotMe, and cash deposits.

We offer our members access to over 45,000 fee-free ATMs.

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For the off-balance sheet MyPay receivables that are retained by either of the bank partners, we recognize revenue based on the instant transfer fee, net of fees paid to bank partners, at an amount that approximates fair value.

We also offer our members the ability to instantly transfer funds from their Chime account to an external account at a fixed rate.

The Company is the principal in these arrangements, as it controls the transfer service before it is provided to the member.

In partnership with its bank partners, card networks, and processors, the Company's performance obligation is to authorize and make funds instantly available in the member's external designated account.

Revenue is recognized at a point in time on a gross basis when the transfer of funds is completed.

Fees are remitted to the Company through its bank partners, generally collected monthly in arrears.

We offer our members access to high yield savings accounts with no minimum deposit requirements.

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These third-party processor costs are generally equal to a fixed amount per transaction coupled with a large-volume discount factor.

Transaction processing and bank partner costs also include hosting and software costs, including the amortization of internal-use software, related to ChimeCore, our proprietary payment processor and ledger that launched in 2024, and the internal-use software supporting the MyPay product and others.

Our third-party processor, which processed transactions and provided a ledger for member accounts prior to the launch of ChimeCore, continues to do so for member accounts not yet migrated to ChimeCore .

Transaction processing and bank partner costs also include hosting, processing, and software costs, including the amortization of

internal-use software, related to ChimeCore, our proprietary payment processor and ledger that launched in 2024, and the internal-use software supporting the MyPay product and others.

Our third-party processor, which processed transactions and provided a ledger for member accounts prior to the launch of ChimeCore, continued to do so for member accounts not yet migrated to ChimeCore through September 30, 2025.

Additionally, transaction processing and bank partner costs include payments to bank partners, including fees paid for serving as our card issuing bank and for card network sponsorship.

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Card and ATM Network Expenses, Net of Incentives

We pay card and ATM networks for providing the worldwide networks through which card payment and ATM transactions are authorized, processed, and settled.

We pay card and ATM networks for providing the worldwide networks through which card payment, ATM transactions, and other money movements are authorized, processed, and settled.

These fees are generally based on the Purchase Volume and the total number of transactions in the period, and vary by network and transaction type.

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Following the launch of MyPay in 2024, our transaction and risk losses have increased.

In absolute dollars, we expect that transaction and risk losses will fluctuate from period to period in the near term and increase in the long term compared to the second quarter of 2025.

As a percentage of revenue, we expect that transaction and risk losses will fluctuate from period to period in the near term and in the long term compared to the second quarter of 2025.

In absolute dollars, we expect that transaction and risk losses will fluctuate from period to period in the near term and increase in the long term compared to the third quarter of 2025.

As a percentage of revenue, we expect that transaction and risk losses will fluctuate from period to period in the near term and in the long term compared to the third quarter of 2025.

Member Support and Operations

Member support and operations expenses include the costs of the third-party vendors we use for certain member support and loss prevention services, the costs of physical debit and credit card issuance, software to help manage member interactions, and member onboarding and account verification expenses.

Member support and operations expenses include the costs of the third-party vendors we use for certain member support and loss prevention services, the costs of physical card issuance, software to help manage member interactions, and member onboarding and account verification expenses.

Member support and operations also includes personnel-related expenses including salaries, employee benefit costs, and stock-based compensation for employees engaged in member support, risk, and operations functions, and allocated overhead.

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Other income, net primarily includes interest income, which consists of interest and dividends earned on our cash and cash equivalents and marketable securities.

Provision (Benefit) for Income Taxes

The provision (benefit) for income taxes consists primarily of income taxes in certain federal, state, local, and foreign jurisdictions in which we conduct business.

Provision for Income Taxes

The provision for income taxes consists primarily of income taxes in certain federal, state, local, and foreign jurisdictions in which we conduct business.

Our effective tax rate will vary depending on the relative proportion of foreign to domestic income, use of tax credits, changes in the valuation of our deferred tax assets and liabilities, and changes in tax laws.

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Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(in thousands, except share and per share amounts) 2025 2024 2025 2024

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Total operating expenses 538,828 398,999 2,379,684 1,081,643

Income (loss) from operations

Loss from operations

(64,710) (30,644) (986,211) (35,053)

Other income, net 10,268 10,817 21,837 31,230

Income (loss) before income taxes

(924,423) 463 (909,932) 16,004

Provision (benefit) for income taxes (1,047) 78 505 (284)

Net income (loss)

Loss before income taxes

(54,442) (19,827) (964,374) (3,823)

Undistributed earnings attributable to preferred stockholders

Provision for income taxes

280 2,199 785 1,915

Net income (loss) attributable to common stockholders

$ (54,722) $ (22,026) $ (965,159) $ (5,738)

Net income (loss) per share attributable to common stockholders, basic and diluted

Net loss per share attributable to common stockholders, basic and diluted

$ (0.15) $ (0.34) $ (5.10) $ (0.09)

Weighted average number of shares outstanding used to compute net income (loss) per share attributable to common stockholders, basic and diluted

Weighted average number of shares outstanding used to compute net loss per share attributable to common stockholders, basic and diluted

371,829,972 65,149,191 189,227,164 64,757,159

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Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(in thousands) 2025 2024 2025 2024

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Total depreciation and amortization $ 7,514 $ 6,897 $ 22,183 $ 18,248

(2) Amounts include stock-based compensation as follows:

(2) Amounts include stock-based compensation and related payroll taxes as follows:

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(in thousands) 2025 2024 2025 2024

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General and administrative 31,383 4,467 256,626 9,232

Total stock-based compensation expense $ 910,147 $ 6,419 $ 918,843 $ 11,594

Comparison of the three and six months ended June 30, 2025 and June 30, 2024

Total stock-based compensation expense and related payroll tax

$ 85,953 $ 10,134 $ 1,022,711 $ 21,728

Comparison of the three and nine months ended September 30, 2025 and September 30, 2024

Three Months Ended

June 30, Change Change Six Months Ended

June 30, Change Change

September 30, Change Change Nine Months Ended

September 30, Change Change

(in thousands, except percentages) 2025 2024 ($) % 2025 2024 ($) %

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Total revenue $ 543,519 $ 421,871 $ 121,648 29 % $ 1,590,412 $ 1,198,057 $ 392,355 33 %

Total revenue for the three and six months ended June 30, 2025 increased by $143.9 million, or 37% and $270.7 million, or 35%, year over year, primarily driven by the growth of our total Active Members and the associated increase in Purchase Volume as well as the launch of MyPay.

Total revenue for the three and nine months ended September 30, 2025 increased by $121.6 million, or 29%, and $392.4 million, or 33%, year over year, primarily driven by the growth of our total Active Members and the associated increase in Purchase Volume as well as the launch of MyPay.

Payments revenue

Payments revenue increased by $58.1 million, or 19%, and $116.1 million, or 19%, for the three and six months ended June 30, 2025 compared to the same period in 2024.

For the three months ended June 30, 2025, this increase reflected a $42.7 million, or 19%, increase in revenue from interchange-based fees from debit card transactions and a $15.5 million, or 18%, increase in revenue from interchange-based fees from credit card transactions compared to the same period in 2024.

The increase in payments revenue was driven by a $4.8 billion, or 18%, increase in Purchase Volume for the three months ended June 30, 2025 compared to the same period in 2024.

For the three months ended June 30, 2025 and 2024, interchange-based fees from debit card transactions represented 50% and 57% of revenue, with debit card transactions representing 84% of Purchase Volume in both periods.

For the three months ended June 30, 2025 and 2024, interchange-based fees from credit card transactions represented 20% and 23% of revenue, with credit card transactions representing 16% of Purchase Volume in both periods.

For the six months ended June 30, 2025, this increase reflected an $85.3 million, or 19%, increase in revenue from interchange-based fees from debit card transactions and a $30.9 million, or 17%, increase in revenue from interchange-based fees from credit card transactions compared to the same period in 2024.

The increase in payments revenue was driven by a $10.2 billion, or 18%, increase in Purchase Volume for the six months ended June 30, 2025 compared to the same period in 2024.

For the six months ended June 30, 2025 and 2024, interchange-based fees from debit card transactions represented 51% and 58% of revenue, with debit card transactions representing 84% of Purchase Volume in both periods.

For the six months ended June 30, 2025 and 2024, interchange-based fees from credit card transactions represented 20% and 23% of revenue, with credit card transactions representing 16% of Purchase Volume in both periods.

The increase in Purchase Volume was driven, in part, by a 1.6 million, or 23%, increase in Active Members as of June 30, 2025 compared to June 30, 2024.

Payments revenue increased by $50.9 million, or 16%, and $167.0 million, or 18%, for the three and nine months ended September 30, 2025 compared to the same period in 2024.

For the three months ended September 30, 2025, this increase reflected a $34.7 million, or 15%, increase in revenue from interchange-based fees from debit card transactions and a $16.2 million, or 19%, increase in revenue from interchange-based fees from credit card transactions compared to the same period in 2024.

The increase in payments revenue was driven by a $4.3 billion, or 15%, increase in Purchase Volume for the three months ended September 30, 2025 compared to the same period in 2024.

For the three months ended September 30, 2025 and 2024, interchange-based fees from debit card transactions represented 48% and 53% of revenue, with debit card transactions representing 84% of Purchase Volume in both periods.

For the three months ended September 30, 2025 and 2024, interchange-based fees from credit card transactions represented 19% and 21% of revenue, with credit card transactions representing 16% of Purchase Volume in both periods.

For the nine months ended September 30, 2025, this increase reflected a $120.0 million, or 18%, increase in revenue from interchange-based fees from debit card transactions and a $47.0 million, or 18%, increase in revenue from interchange-based fees from credit card transactions compared to the same period in 2024.

The increase in payments revenue was driven by a $14.5 billion, or 17%, increase in Purchase Volume for the nine months ended September 30, 2025 compared to the same period in 2024.

For the nine months ended September 30, 2025 and 2024, interchange-based fees from debit card transactions represented 50% and 56% of revenue, with debit card transactions representing 84% of Purchase Volume in both periods.

For the nine months ended September 30, 2025 and 2024, interchange-based fees from credit card transactions represented 20% and 22% of revenue, with credit card transactions representing 16% of Purchase Volume in both periods.

The increase in Purchase Volume was driven, in part, by a 1.6 million, or 21%, increase in Active Members as of September 30, 2025 compared to September 30, 2024.

Increasing the number of Active Members on our platform helps drive Purchase Volume, which increases the interchange-based fees generated and the payments revenue that we recognize.

Platform-related revenue

Platform-related revenue for the three and six months ended June 30, 2025 increased $85.8 million, or 113%, and $154.6 million, or 102%, year over year.

For the three and six months ended June 30, 2025, the increase was primarily driven by a $69.1 million and $125.8 million increase year over year from the full launch of MyPay in July 2024.

Platform-related revenue for the three and nine months ended September 30, 2025 increased $70.7 million, or 65%, and $225.3 million, or 86%, year over year.

For the three and nine months ended September 30, 2025, the increase was primarily driven by a $47.4 million and $173.2 million increase year over year from the full launch of MyPay in July 2024.

Additionally, we recognized $11.1 million and $22.7 million in revenue for outbound instant transfer fees, which launched in the first quarter of 2025, in the three and nine months ended September 30, 2025.

Cost of revenue

Three Months Ended

June 30, Change Change Six Months Ended

June 30, Change Change

September 30, Change Change Nine Months Ended

September 30, Change Change

(in thousands, except percentages) 2025 2024 ($) % 2025 2024 ($) %

Cost of revenue $ 69,401 $ 53,516 $ 15,885 30 % $ 196,939 $ 151,467 $ 45,472 30 %

Cost of revenue for the three months ended June 30, 2025 increased $16.6 million, or 33%, year over year driven by a $10.0 million increase in card and ATM network expenses, net of incentives, and a $6.6 million increase in transaction processing and bank partner costs, both primarily driven by the increase in Active Members and related increase in Purchase Volume, and an increased level of activity from existing members engaging more frequently with our products.

Cost of revenue for the six months ended June 30, 2025 increased $29.6 million, or 30%, year over year driven by a $15.0 million increase in card and ATM network expenses, net of incentives, and a $14.6 million increase in transaction processing and bank partner costs, both primarily driven by the increase in Active Members and related increase in Purchase Volume, and an increased level of activity from existing members engaging more frequently with our products.

Cost of revenue for the three months ended September 30, 2025 increased $15.9 million, or 30%, year over year driven by a $9.3 million increase in card and ATM network expenses, net of incentives, and a $6.6 million increase in transaction processing and bank partner costs, both primarily driven by the increase in Active Members and related increase in Purchase Volume, and an increased level of activity from existing members engaging more frequently with our products.

Cost of revenue for the nine months ended September 30, 2025 increased $45.5 million, or 30%, year over year driven by a $24.3 million increase in card and ATM network expenses, net of incentives, and a $21.2 million increase in transaction processing and bank partner costs, both primarily driven by the increase in Active Members and related increase in Purchase Volume, and an increased level of activity from existing members engaging more frequently with our products.

Additionally, the increase in transaction processing and bank partner costs included a $3.3 million increase in the amortization of internal-use software relating to revenue generating platforms such as ChimeCore and MyPay.

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Three Months Ended

June 30, Change Change Six Months Ended

June 30, Change Change

September 30, Change Change Nine Months Ended

September 30, Change Change

(in thousands, except percentages) 2025 2024 ($) % 2025 2024 ($) %

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Total operating expenses $ 538,828 $ 398,999 $ 139,829 35 % $ 2,379,684 $ 1,081,643 $ 1,298,041 120 %

Operating expenses increased by $1,048.5 million, or 306%, and $1,158.2 million, or 170%, for the three and six months ended June 30, 2025 compared to the three and six months ended June 30, 2024 driven by the following changes:

Operating expenses increased by $139.8 million, or 35%, and $1,298.0 million, or 120%, for the three and nine months ended September 30, 2025 compared to the three and nine months ended September 30, 2024 driven by the following changes:

Transaction and risk losses

Transaction and risk losses for the three and six months ended June 30, 2025 increased $63.2 million, or 181%, and $136.4 million, or 192%, year over year.

The increase was driven by the full launch of MyPay, which contributed $49.3 million and $103.5 million for the three and six months ended June 30, 2025.

Additionally, losses related to SpotMe and other member negative balances increased by $5.0 million in the three months ended June 30, 2025 as a result of higher SpotMe volume driven by the growth in Active Members and increased $18.1 million in the six months ended June 30, 2025 due to higher SpotMe volume and isolated fraud incidents in the first quarter of 2025, when compared to the same periods in 2024.

Transaction and risk losses for the three months ended September 30, 2025 increased $41.9 million, or 76%, year over year.

The increase was driven by a $24.8 million increase in losses related to MyPay as the product continues to scale, a $5.7 million increase in transaction dispute losses, and an increase of $3.9 million in losses related to SpotMe and other member negative balances as a result of higher SpotMe volume driven by the growth in Active Members.

Transaction and risk losses for the nine months ended September 30, 2025 increased by $178.2 million, or 141%, year over year driven by the full launch of MyPay in July 2024, which contributed $128.3 million, and an increase of $22.1 million in losses related to SpotMe and other member negative balances due to higher SpotMe volume and isolated fraud incidents in the first quarter of 2025, when compared to the same periods in 2024.

Member support and operations

Member support and operations expenses for the three and six months ended June 30, 2025 increased by $133.3 million, or 191%, and $143.8 million, or 104%, year over year driven by an increase in stock-based compensation and related payroll tax of $121.6 million in the three months ended June 30, 2025 as the liquidity-based vesting condition for certain stock-based awards was met upon our IPO.

Member support and operations expenses for the three and nine months ended September 30, 2025 increased by $13.6 million, or 19%, and $157.4 million, or 76%, year over year driven by an increase in stock-based compensation and related payroll tax of $9.4 million and $131.0 million in the three and nine months ended September 30, 2025 as the liquidity-based vesting condition for certain stock-based awards was met upon our IPO in the second quarter of 2025.

Additionally, there was an increase of $1.8 million and $10.4 million in the three and nine months ended September 30, 2025 due to physical card production and fulfillment costs due to the increased volume of cards issued.

Sales and marketing

Sales and marketing expenses for the three and six months ended June 30, 2025 increased by $67.0 million, or 57%, and $82.5 million, or 35%, year over year driven by an increase in stock-based compensation and related payroll tax of $43.1 million in the three months ended June 30, 2025 as the liquidity-based vesting condition for certain stock-based awards was met upon our IPO.

Additionally, there was an increase of $20.3 million and $34.0 million in marketing and promotional activities in the three and six months ended June 30, 2025 compared to the prior year.

Sales and marketing expenses for the three months ended September 30, 2025 increased by $10.5 million, or 7%, year over year driven by an increase in stock-based compensation and related payroll tax of $3.7 million in the three months ended September 30, 2025 as the liquidity-based vesting condition for certain stock-based awards was met upon our IPO in the second quarter of 2025.

Additionally, there was an increase of $3.1 million in marketing and promotional activities and an increase of $2.1 million in personnel-related expenses primarily attributable to increased headcount in the three months ended September 30, 2025 compared to the prior year.

Sales and marketing for the nine months ended September 30, 2025 increased by $93.0 million, or 25%, year over year driven by an increase in stock-based compensation and related payroll tax of $47.0 million in the nine months ended September 30, 2025 as the liquidity-based vesting condition for certain stock-based awards was met upon our IPO.

Additionally, there was an increase of $37.2 million in marketing and promotional activities in the nine months ended September 30, 2025 compared to the prior year.

Technology and development

Technology and development expenses for the three and six months ended June 30, 2025 increased by $546.4 million, or 725%, and $549.3 million, or 365%, year over year driven by an increase in stock-based compensation and related payroll tax of $537.5 million in the three months ended June 30, 2025 as the liquidity-based vesting condition for certain stock-based awards was met upon our IPO.

Technology and development expenses for the three and nine months ended September 30, 2025 increased by $43.5 million, or 54%, and $592.9 million, or 257%, year over year primarily driven by an increase in stock-based compensation and related payroll tax of $35.9 million in the three months ended September 30, 2025 and $575.5 million in the nine months ended September 30, 2025 as the liquidity-based vesting condition for certain stock-based awards was met upon our IPO in the second quarter of 2025.

General and administrative

General and administrative expenses for the three and six months ended June 30, 2025 increased by $238.0 million, or 572%, and $246.0 million, or 304%, year over year, primarily driven by an increase in stock-based compensation and related payroll tax of $219.4 million in the three months ended June 30, 2025 as the liquidity-based vesting condition for certain stock-based awards was met upon our IPO.

General and administrative expenses for the three and nine months ended September 30, 2025 increased by $29.9 million, or 64%, and $275.9 million, or 216%, year over year, primarily driven by an increase in stock-based compensation and related payroll tax of $26.9 million in the three months ended September 30, 2025 and $247.4 million in the nine months ended September 30, 2025 as the liquidity-based vesting condition for certain stock-based awards was met upon our IPO in the second quarter of 2025.

Other income, net

Three Months Ended

June 30, Change Change Six Months Ended

June 30, Change Change

September 30, Change Change Nine Months Ended

September 30, Change Change

(in thousands, except percentages) 2025 2024 ($) % 2025 2024 ($) %

Other income, net $ 10,268 $ 10,817 $ (549) (5) % $ 21,837 $ 31,230 $ (9,393) (30) %

Other income, net for the three and six months ended June 30, 2025 decreased by $3.7 million, or 37%, and decreased by $8.8 million, or 43%, year over year, primarily attributable to a decrease in interest income due to lower average balance totals and reduced yields on corporate cash and cash equivalents and marketable securities.

Other income, net for the three months ended September 30, 2025 decreased by $0.5 million, or 5%, year over year, primarily attributable to letter of credit fees and unused commitment fees related to the revolving credit agreement entered into in March 2025.

Other income, net for the nine months ended September 30, 2025 decreased by $9.4 million, or 30%, year over year, primarily attributable to a decrease of $6.1 million in interest income due to lower average balance totals and reduced yields on corporate cash and cash equivalents and marketable securities and an increase of $1.2 million in letter of credit fees and unused commitment fees related to the revolving credit agreement entered into in March 2025.

Liquidity and Capital Resources

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Since inception, prior to our IPO, we have financed our operations primarily through the net proceeds we have received from the issuances of preferred stock and our revenue.

As of June 30, 2025, our principal sources of liquidity were our cash and cash equivalents of $868.3 million and investments in marketable securities of $225.1 million.

As of September 30, 2025, our principal sources of liquidity were our cash and cash equivalents of $445.0 million and investments in marketable securities of $633.7 million.

On June 13, 2025, we closed our IPO of our Class A common stock.

The total net proceeds received were approximately $770.6 million after deducting underwriting discounts, commissions and offering expenses payable by us.

As of June 30, 2025, we had $443.6 million in borrowing capacity under our revolving credit facility.

Refer to Note 10 - Indebtedness within the notes to our consolidated financial statements in this Quarterly Report for further information.

As of September 30, 2025, we had $443.6 million in borrowing capacity under our revolving credit facility.

Refer to Note 10 - Indebtedness within the notes to our condensed consolidated financial statements in this Quarterly Report for further information.

Our bank partners also retain accounts and receivables related to Chime-branded credit and liquidity products on their balance sheet, and pursuant to the Bancorp MSA, Bancorp committed to retain certain receivables on its balance sheet in an amount, not to exceed, on an aggregate basis, 200% of its tier 1 capital, with such amount in connection with liquidity products excluding Credit Builder not to exceed 125% of its tier 1 capital (each as measured on the last day of each calendar quarter).

Bancorp’s tier 1 capital includes common shareholders’ equity, certain qualifying perpetual preferred stock and minority interests in equity accounts of consolidated subsidiaries, less intangibles.

Based on Bancorp’s tier 1 capital as of June 30, 2025, the amount of this commitment would have been approximately $1.9 billion (with such amount in connection with liquidity products excluding Credit Builder not to exceed approximately $1.2 billion).

Based on Bancorp’s tier 1 capital as of September 30, 2025, the amount of this commitment would have been approximately $1.7 billion (with such amount in connection with liquidity products excluding Credit Builder not to exceed approximately $1.1 billion).

Bancorp has the right to limit originations under this commitment in the event the forecasted performance of the liquidity products offered under this commitment is expected to result in significant unrecoverable losses.

Specifically, Bancorp has the right to limit originations under this commitment during periods when a specified threshold is projected to be exceeded relating to the forecasted ratio of (i) projected losses less projected revenue from the liquidity products offered under this commitment to (ii) the sum of our cash, our marketable securities, and certain assets held at Bancorp.

In November 2025, our board of directors approved a share repurchase program with authorization to purchase up to $200.0 million of our Class A common stock at management’s discretion.

Repurchases may be made from time to time through open market purchases, privately negotiated transactions or other means, subject to market conditions, applicable legal requirements, and other relevant factors.

Open market purchases may be structured to occur in accordance with the requirements of Rule 10b-18 of the Exchange Act.

We may also, from time to time, enter into Rule 10b5-1 plans to facilitate repurchases of our Class A common stock under this authorization.

The timing and actual number of shares repurchased may depend on a variety of factors, including legal requirements, price, and economic and market conditions.

The program does not obligate us to repurchase any particular amount of Class A common stock and may be suspended or discontinued at any time at our discretion without prior notice, subject to all applicable securities laws.

We believe that our current available cash and cash equivalents and investments in marketable securities will be sufficient to meet our working capital needs for at least the next twelve months.

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The following table shows the generation and use of cash for the periods indicated:

Six Months Ended

Nine Months Ended

September 30,

(in thousands) 2025 2024

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Cash Flows from Operating Activities

Cash provided by operating activities was $2.7 million for the six months ended June 30, 2025, which consisted of net loss of $910.4 million and an increase in working capital of $151.1 million, offset by non-cash adjustments of $1,064.3 million.

Our net loss and non-cash adjustments were driven by $918.8 million in stock-based compensation expense, as the liquidity-based vesting condition for certain equity awards was met in connection with our IPO.

The increase in working capital of $151.1 million was primarily driven by a $93.3 million decrease in accrued and other liabilities attributable to the payment of the annual bonus, realized losses on accrued transaction disputes, and the timing of vendor invoices .

In addition, there was an increase in product collateral of $31.3 million and settlements of our product obligation of $19.0 million.

Cash provided by operating activities was $70.8 million for the six months ended June 30, 2024, which consisted of net income of $16.3 million and non-cash adjustments of $75.0 million, offset by an increase in working capital of $20.4 million.

Non-cash adjustments of $75.0 million primarily reflect amounts relating to transaction and risk loss, which include the change in fair value of our product obligation, provision for transaction dispute losses, and provision for credit losses, as well as amounts relating to stock-based compensation and depreciation and amortization.

The increase in working capital of $20.4 million was primarily due to $28.3 million in settlements of our product obligation and an increase of $25.0 million in product collateral, offset by an increase in accrued and other liabilities of $30.5 million primarily attributable to upfront incentives received from card networks in the first quarter of 2024 and partially offset by realized transaction dispute losses.

Cash provided by operating activities was $20.2 million for the nine months ended September 30, 2025, compared to $45.9 million in the nine months ended September 30, 2024.

The decrease of $25.7 million in cash provided by operating activities consists of a $959.4 million increase in net loss, a decrease of $132.3 million in changes in working capital, and offset by an increase of $1,066.1 million in non-cash adjustments.

The decrease of $132.3 million in changes in working capital for the nine months ended September 30, 2025 compared to the prior year was driven by upfront incentives received from card networks in the first quarter of 2024, an increase in the annual bonus paid, increases in realized transaction dispute losses, and the timing of vendor invoices.

The increase of $1,066.1 million in non-cash adjustments for the nine months ended September 30, 2025 compared to the prior year was primarily driven by a $981.9 million increase in stock-based compensation expense as the liquidity-based vesting condition for certain equity awards was met in connection with our IPO in the second quarter of 2025.

Additionally, there was a $50.2 million increase in provision for credit losses for the nine months ended September 30, 2025 compared to the same period in 2024 driven by the launch of MyPay in July 2024.

Cash Flows from Investing Activities

Cash provided by investing activities was $79.1 million for the six months ended June 30, 2025, primarily due to $2,311.6 million in repayments of loans held for investment, $256.5 million from sales of marketable securities and $123.2 million in proceeds from maturities of marketable securities, offset by $2,368.2 million in purchases of loans held for investment and $234.1 million in purchases of marketable securities.

Cash used in investing activities was $5.2 million for the six months ended June 30, 2024, primarily due to $289.5 million in purchases of marketable securities, $54.7 million in purchases of loans held for investment, and $11.0 million related to a business acquisition, offset by $306.9 million in proceeds from maturities of marketable securities and $30.6 million in repayments of loans held for investment.

Cash used by investing activities was $344.5 million for the nine months ended September 30, 2025, primarily due to $3,616.9 million in purchases of loans held for investment and $665.3 million in purchases of marketable securities, offset by $3,547.7 million in repayments of loans held for investment, $256.5 million from sales of marketable securities and $147.2 million in proceeds from maturities of marketable securities.

Cash used in investing activities was $4.8 million for the nine months ended September 30, 2024, primarily due to $735.2 million in purchases of loans held for investment, $361.2 million in purchases of marketable securities, and $11.0 million related to a business acquisition, offset by $649.7 million in repayments of loans held for investment and $436.2 million in proceeds from maturities of marketable securities.

Cash Flows from Financing Activities

For the six months ended June 30, 2025, cash provided by financing activities was $449.9 million, primarily due to $772.6 million from the issuance of common stock in connection with our IPO, net of offering costs paid, partially offset by taxes paid related to the net share settlement of restricted stock units of $322.6 million

For the six months ended June 30, 2024, cash provided by financing activities was $7.0 thousand, consisting of $0.6 million in proceeds from the exercise of stock options, nearly entirely offset by repurchases of common stock.

For the nine months ended September 30, 2025, cash provided by financing activities was $433.0 million, primarily due to $771.2 million from the issuance of common stock in connection with our IPO, net of offering costs paid, partially offset by taxes paid related to the net share settlement of restricted stock units of $348.1 million.

For the nine months ended September 30, 2024, cash used by financing activities was $43.0 thousand, consisting of $1.0 million in repurchases of common stock, nearly entirely offset by proceeds from the exercise of stock options.

We calculate our fully diluted share count on an unweighted basis taking our total outstanding share count in addition to unexercised stock options, outstanding restricted stock units, outstanding PSUs, shares reserved for charitable donations and warrants to purchase common stock.

As of June 30, 2025, our fully diluted share count was as follows:

As of September 30, 2025, our fully diluted share count was as follows:

Class A and B common stock issued and outstanding 374,417,665

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Shares reserved for charitable donations 2,889,173

Common stock warrants outstanding 787,840

Total fully diluted share count 439,920,313

For further information see Note 11, “Redeemable Convertible Preferred Stock, Common Stock, and Stockholders’ Equity (Deficit)" and Note 13, “Net Income (Loss) Per Share” included in this Quarterly Report on Form 10-Q in “Notes to Condensed Consolidated Financial Statements”.

As of June 30, 2025, we had future minimum operating lease payments under non-cancelable leases of $182.6 million related to leases we have recognized on our consolidated balance sheet and leases that have been executed but not yet commenced, which are due over the following 6.9 years.

For further information see Note 11, “Redeemable Convertible Preferred Stock, Common Stock, and Stockholders’ Equity (Deficit)" and Note 13, “Net Loss Per Share” included in this Quarterly Report on Form 10-Q in “Notes to Condensed Consolidated Financial Statements”.

As of September 30, 2025, we had future minimum operating lease payments under non-cancelable leases of $177.6 million related to leases we have recognized on our consolidated balance sheet which are due over a weighted average period of 8.4 years.

Of the non-cancelable lease payments, $5.0 million is payable in the remainder of 2025.

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Our non-cancellable purchase commitments are primarily related to our cloud infrastructure services and third-party payment processor.

As of June 30, 2025, we had non-cancellable purchase obligations of $294.9 million, with $104.0 million to be paid in the remainder of 2025 and the remaining amounts thereafter.

As of September 30, 2025, we had non-cancellable purchase obligations of $267.1 million, with $51.8 million to be paid in the remainder of 2025 and the remaining amounts thereafter.

Critical Accounting Policies and Estimates

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis