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Is CashAI the Engine Powering Dave's Fintech Momentum?
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Key Takeaways
Dave posts $2B in ExtraCash originations in Q3, up 49% y/y.
CashAI v5.5 drives lower delinquency rates, with September metrics showing notable dips.
Dave reports record Q3 revenues of $150.8M and raises the full-year guidance across key metrics.
Dave Inc.’s (DAVE - Free Report) proprietary underwriting engine, CashAI, is an AI-backed tool utilized to assess credit risk and eligibility. This technology is instrumental in improving ExtraCash originations' size and delinquency rates.
In the third quarter of 2025, Dave registered $2 billion in Extracash originations, up 49% year over year. This was not a one-off event, as the metric has improved across the past few quarters, evidenced by 46% year-over-year growth in the first quarter and 51% in the second one.
Dave’s average 28-day delinquency rate dipped 7 basis points (bps) sequentially to 2.33% in the third quarter of 2025, which is a positive sign. What is more impressive is that in September, the metric was 2.19% due to the new CashAI v5.5. During the last reported quarter’s earnings call, management announced the introduction of 28-day days past due, a metric which has shown early improvements as evidenced by an 11 bps dip sequentially to 2.15% and the same stood at 2.04% in September. It clearly reflects CashAI v5.5’s prowess in managing credit risks.
Banking on these improvements, DAVE witnessed record revenues of $150.8 million in the third quarter of 2025, surging 63% year over year. Better customer conversion facilitated by CashAI resulted in holding customer acquisition costs at $19 in the past two quarters. This is partly responsible for solidifying the profitability picture, wherein adjusted net income rose a whopping 193% year over year in the third quarter of 2025 and grew 34.8% sequentially.
Dave’s current financial stance is flattering; however, we must look beyond this performance to ascertain whether CashAI can continue to support its trajectory.
Going by the guidance, we see that management is highly optimistic about Dave’s revenue generation, which is expected to hover at $544-$547 million compared with the preceding quarter’s view of $505-$515 million. On a similar note, adjusted EBITDA is expected to be $215-$218 million compared with $180-$190 million, as provided in the previous quarter. This strategic confidence, laced with CashAI v5.5’s early sign of success at mitigating credit risks and its demonstrated influence in catering to customer demands, compels us to expect this AI-driven tool to continue delivering favorable outcomes for the company.
DAVE’s Price Performance, Valuation & Estimates
Dave’s stock has skyrocketed 131% in the past year, significantly outperforming the 7.9% rally of its industry. The stock has outperformed its industry peer First Advantage Corporation’s (FA - Free Report) 31.7% dip and Futu Holdings’ (FUTU - Free Report) 101.3% surge during the same timeframe.
1-Year Share Price Performance
Image Source: Zacks Investment Research
From a valuation standpoint, DAVE trades at a 12-month forward price-to-earnings ratio of 14.56, lower than the industry’s 25.27. Dave appears expensive when compared with First Advantage’s 10.75, while being cheaper than Futu Holdings’ 17.15.
P/E - F12M
Image Source: Zacks Investment Research
Dave has a Value Score of D, while First Advantage and Futu Holdings carry a Value Score of B and C, respectively.
The Zacks Consensus Estimate for Dave’s earnings for 2025 and 2026 has risen 24.7% and 12%, respectively, over the past 60 days.
Image: Bigstock
Is CashAI the Engine Powering Dave's Fintech Momentum?
Key Takeaways
Dave Inc.’s (DAVE - Free Report) proprietary underwriting engine, CashAI, is an AI-backed tool utilized to assess credit risk and eligibility. This technology is instrumental in improving ExtraCash originations' size and delinquency rates.
In the third quarter of 2025, Dave registered $2 billion in Extracash originations, up 49% year over year. This was not a one-off event, as the metric has improved across the past few quarters, evidenced by 46% year-over-year growth in the first quarter and 51% in the second one.
Dave’s average 28-day delinquency rate dipped 7 basis points (bps) sequentially to 2.33% in the third quarter of 2025, which is a positive sign. What is more impressive is that in September, the metric was 2.19% due to the new CashAI v5.5. During the last reported quarter’s earnings call, management announced the introduction of 28-day days past due, a metric which has shown early improvements as evidenced by an 11 bps dip sequentially to 2.15% and the same stood at 2.04% in September. It clearly reflects CashAI v5.5’s prowess in managing credit risks.
Banking on these improvements, DAVE witnessed record revenues of $150.8 million in the third quarter of 2025, surging 63% year over year. Better customer conversion facilitated by CashAI resulted in holding customer acquisition costs at $19 in the past two quarters. This is partly responsible for solidifying the profitability picture, wherein adjusted net income rose a whopping 193% year over year in the third quarter of 2025 and grew 34.8% sequentially.
Dave’s current financial stance is flattering; however, we must look beyond this performance to ascertain whether CashAI can continue to support its trajectory.
Going by the guidance, we see that management is highly optimistic about Dave’s revenue generation, which is expected to hover at $544-$547 million compared with the preceding quarter’s view of $505-$515 million. On a similar note, adjusted EBITDA is expected to be $215-$218 million compared with $180-$190 million, as provided in the previous quarter. This strategic confidence, laced with CashAI v5.5’s early sign of success at mitigating credit risks and its demonstrated influence in catering to customer demands, compels us to expect this AI-driven tool to continue delivering favorable outcomes for the company.
DAVE’s Price Performance, Valuation & Estimates
Dave’s stock has skyrocketed 131% in the past year, significantly outperforming the 7.9% rally of its industry. The stock has outperformed its industry peer First Advantage Corporation’s (FA - Free Report) 31.7% dip and Futu Holdings’ (FUTU - Free Report) 101.3% surge during the same timeframe.
1-Year Share Price Performance
From a valuation standpoint, DAVE trades at a 12-month forward price-to-earnings ratio of 14.56, lower than the industry’s 25.27. Dave appears expensive when compared with First Advantage’s 10.75, while being cheaper than Futu Holdings’ 17.15.
P/E - F12M
Dave has a Value Score of D, while First Advantage and Futu Holdings carry a Value Score of B and C, respectively.
The Zacks Consensus Estimate for Dave’s earnings for 2025 and 2026 has risen 24.7% and 12%, respectively, over the past 60 days.
DAVE currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.