Q1 2025 Dave Inc Earnings Call
Good morning everyone, and thank you for participating in today's conference call to discuss Dave's financial results for the first quarter and did March 31st, 2025.
Speaker Change: Joining us today are Dave, CEO , Mr. Jason Wilk, and the company CFO , Mr. Kyle Beilman. By now, everyone should have access to the first quarter 2025 earnings press release, which was issued this morning.
Speaker Change: The release is available in the Investors Relations section of Dave's website at investors.dave.com. In addition, this call will be available for webcast replay on the company's website following management remarks will open the call to answer your questions.
Speaker Change: Certain comments made during this conference call and webcast are considered forward-looking statements under the private
Securities, Litigation Reform Act of 1995 1995
Speaker Change: These forward-looking statements are subject to certain known and unknown risks and uncertainties as well as assumptions that could cause actual results to differ materially from those reflected in these forward-looking statements.
Speaker Change: These forward-looking statements are also subject to other risks and uncertainties that are described from time to time in the company's filings with the SEC. Do not place undue reliance on any forward-looking statements.
Speaker Change: which are made only as of the date of this call, except as required by law, the company undertakes no obligation to revise or update any forward-looking statements.
Speaker Change: You'll find reconciliation tables and other important information in the earnings press release and form 8k furnished by to to the SEC.
Speaker Change: I would now like to turn the call over to Dave's CEO , Mr. Jason Wilk. Please go ahead.
Thank you and good morning, everyone.
Speaker Change: Building on the success of last year's results, we are pleased to report another record setting first quarter of which outperformed expectations across key areas of our business.
Speaker Change: Topline Brode exited on a year-over-year basis to its highest medal since 2021 thanks in large part to the strong double-digit gains in RQ and multi-transacting members.
Speaker Change: Joseph Iba to growth accelerated 235% to 44.2 million, representing a year-over-year increase of 31 million, which is the largest dollar increase in our company's history.
Speaker Change: This increase is mostly due to the operating numbers we continue to achieve on our fixed cost base, as well as a variable margin expansion we continue to generate from cash AI credit performance improvements.
Speaker Change: Given our results and momentum we have in our business, we are raising our full year 2025 guidance for both revenue and adjusted EBITDA. This is the seventh consecutive quarter we have either raised or exceeded our guidance.
Speaker Change: Before turning to our strategic growth tillers, I want to provide an update on our recent transition to the new fee structure for extra cash. As a reminder, on February 19th, we fully transition to a new fee structure consisting of a flat 5% fee on all extra cash transactions with a $5 minimum and a $15 cap, removing optional tips, as well as additional transfer fees to Dave checking.
Speaker Change: Consistent with the testing we performed at the end of last year and into early this year results have been better than expected with this change we've unlocked enhanced member lifetime value through improvements in conversion retention and monetization among new and existing members.
Speaker Change: Approximately 60% of total originations were on the new FEMA model in Q1, so we will receive the full benefit of the change in Q2 onwards.
Speaker Change: Turning now into our three strategic growth pillars, a fishing member acquisition, enhanced member engagement through extra cash, and deepening relationships with the bearded Dave
Speaker Change: Starting with our first strategic growth teller of efficient memory acquisition.
Speaker Change: We continue to efficiently acquire members of scale, reflecting the power of our credit first value proposition and its synergies with our banking product suite. In Q1, total members grew 15% year-of-year, ending the first quarter at 12.4 million members.
Speaker Change: Tak in the first quarter increased 13% year of a year as a result of strategic refinements in our marketing approach.
Speaker Change: This recalibration is also closely tied to the higher member lifetime value we are observing following the transition to our new theme model.
Speaker Change: Based on these factors, the return on our Q on marketing investments is expected to outpace that of prior periods. Importantly, our outlook for new number of growth remains strong, and we expect to continue to achieve strong LTV to crack returns at scale moving forward.
Speaker Change: Our second strategic pillar centers around continuing to strengthen engagement with our members through credit.
Speaker Change: Extra CAST remains the key entry point for building long-term relationships with our members by addressing what is typically their primary need, short-term liquidity for gas groceries and bills.
Speaker Change: Our multi-transacting member base continues to grow with MTMs up 13% year of a year and 3% sequentially to a record 2.5 million.
Speaker Change: This growth was favorably impacted by a higher new member conversion and dormant member reactivation in addition to continued strength and member attention.
Speaker Change: We saw strong engagement with extra cash originations exceeding 1.5 billion, representing an increase of 46% year-over-year and 3% sequentially.
Speaker Change: We believe this sustained growth, particularly during a seasonally soft recorder, is a testament to the effectiveness of our Cache AI underwriting engine and new fee model.
Speaker Change: The average size of an extra-cathill origination in Q1 expanded 21% year-over-year to 192.
Speaker Change: In March, which is the first full month operating under our new V model, the average extra cast size was just over $200, which we believe both well for resignation volumes and corresponding monetization in Q2 and going forward.
Speaker Change: Turning to credit performance, our 28-day delinquency rate improves 33 basis points or 18% year-over-year to 1.5% over which time extra cash originations expanded 46% as I mentioned.
Speaker Change: We believe this performance underscores the continued strength and scalability of our proprietary cash AI underriding engine and the inherent advantages of our extra cash product structure.
Speaker Change: Jeffrey Cash's short duration has allowed us to originate over 136 million transactions in inception, enabling continuous and dynamic credit risk evaluation.
Speaker Change: We've been leading the product's primary use cases covering essential needs such as gas, groceries, and red, further enhanced its resiliency across macroeconomic cycles.
Speaker Change: Combined with extra cash, a short repayment cycle, this creates a rapid feedback loop for optimizing underwriting.
Speaker Change: This agile framework gives a strong confidence in our ability to manage credit risk across the range of economic scenarios.
Speaker Change: In contrast, our short cycle model and real-time risk identification enables us to adapt underwriting dynamically a structural advantage that could provide a tailwind for Dave and a stress macro when there are fewer credit alternatives for consumers in the market.
Speaker Change: That was the previously highlighted tax refund season is typically the strongest period of credit performance as a result of the additional liquidity tax refunds provide to our members
Speaker Change: As such, we expect our 28-day delinquency rate to normalize throughout the rest of the year.
Speaker Change: Cassie Isaacs, a sophisticated tool that allows us to manage the linkancy and loss rates with considerable precision and optimize credit performance in order to maximize variable
Speaker Change: The third and final pillar of our growth strategy focuses on depicting member relationships by enhancing engagement with Dave Carr. Our strategy leverages the power of our market leading extra cash offering to build deeper, long-term banking relationships with our members.
Speaker Change: Part spending increased to a record of 488 million, up 24% year-of-year and 7% sequentially.
Speaker Change: This growth was primarily driven by the growth in M.T.M.s as well as the seasonal spending supported provided by SACS refunds.
Speaker Change: Between the growing uses of the Dave card and the continuum of momentum we are seeing an extra cash, we expanded RPU by 29% year-of-year. This is our seventh consecutive quarter of double-digit RPU expansion on a year-of-year basis and the fastest-based growth since early 2022.
Speaker Change: Much of this improvement in Q1 is attributable to the higher average revenue per origination, which came in at approximately $11.40, up 26% year of a year and 12% sequentially due largely to the impact from our new fee model driving higher extra cash approval limits.
Speaker Change: In March, which was the first full month operating under our new theme model, average revenue per origination was over $13, which we believed both well for monetization and Q2 and beyond.
Speaker Change: Riching gears a bit. I'd like to provide an update on a strategic partnership with Coastal Community Bank, which will take over support of Dave's extra cash and banking products from our current partner.
Speaker Change: We've been busy planning the transition process and expect to begin onboarding new customers to the Coastal platform in early Q3, with existing customers beginning to transition later this year.
Speaker Change: We believe coastal scale, experience, and strong compliance and risk-managing capabilities will best serve our members in our business as we continue to live on our growth and profitability objectives.
Speaker Change: The partnership is expected to also strengthen Dave's ability to launch a new next generation product aligned with our mission of loving the playing field for everyday Americans.
Speaker Change: Before turning the call for Kyle, I want to briefly touch on the litigation with the Department of Justice as we discuss at our last earnings fall on February 28th, we thought our motion to dismiss the lawsuit.
Speaker Change: Outline what we believe to be the technical deficiencies in the DOJ's amended complaint. We now expect a ruling on this motion in Q3 of this year. We remain confident in our legal position and are prepared to vigorously defend ourselves throughout the legal process.
Speaker Change: Going forward, we remain well positioned to execute against our strategic initiatives that we believe will unlock the full-earning potential of our business model.
Speaker Change: Q1 represented another step function change in our profitable growth trajectory attributed to solid performance across the business and amplified by the early success of our new
Speaker Change: I want to thank our team for their tireless dedication to delivering outstanding values for our members and shareholders.
Speaker Change: With that, I'll now turn the call over to Kyle to discuss our detailed financial results. Kyle?
Thank you, and good morning, everyone.
Speaker Change: Building on the momentum from last year, our first quarter results set new records across nearly all key operating and financial metrics, further underscoring the strength and scalability of our business model.
Speaker Change: We continue to demonstrate substantial operating leverage by accelerating revenue growth through increased R2 and transacting member growth while maintaining discipline cost control.
Speaker Change: In Q1, Total Revenue reached a record high, 108 million, representing year-over-year growth of 47%.
Speaker Change: This was driven by a 13% increase in MTMs and a 29% lift in R2, reflecting increase member engagement and stronger monetization.
Speaker Change: During the first quarter, non-gat variable profit grew 67% year-over-year, to 83.4 million, with variable margin reaching 77%, up nearly 950 basis points year-over-year.
Speaker Change: This improvement was primarily driven by reduced provision expense as a percentage of revenue, reflecting significant credit performance improvements delivered by CacheI.
Speaker Change: I'm going optimization of payment processing costs and renegotiations of key vendor contracts contributed as well.
Speaker Change: Looking ahead, we anticipate credit performance will normalize following the seasonally strong first quarter, with variable margins expected to be in the upper 60s to low 70s range for the remainder of the year.
Now, turning the operating expenses.
Speaker Change: Our provision for credit losses increased by 7% year-over-year to 10.6 million, primarily due to increased origination volumes.
Speaker Change: which rose by 46%, partially offset by continued enhancements in credit risk management.
Speaker Change: As a percentage of originations, our provision for credit losses declined to 0.69% from 0.94% in the same quarter last year.
Speaker Change: We believe this proprietary training data set paired with Cache AI has allowed us to build a mode and flywheel for our business.
Speaker Change: With more training data, we're better able to identify and segment good risk, thereby maximizing approval and offer amounts for our members that are differentiated from competitors.
Speaker Change: On a sequential basis, our provision for credit losses improves 36% due to the favorable repayment trends we experience in the first quarter as a result of tax refund season.
Speaker Change: We observed higher tax refunds per member in Q1, relative to Q1 of last year, which was a driver of lower charge-offs and stronger recoveries than we anticipated.
Speaker Change: Going forward, we anticipate provision for credit losses as a percentage of originations will trend upward over the remainder of the year.
Speaker Change: This expectation primarily reflects the normalization coming out of tax refund season.
Speaker Change: We expect provision expense as a percentage of originations to reach its high point in Q3 since that quarter ends on a Tuesday, which is typically the interweek peak for receivables balances.
Speaker Change: Processing and servicing costs decrease 8% year over year to 7.1 million driven primarily by efficiency of gain from two significant vendor contracts renegotiated last year.
Speaker Change: We also benefited from the scale economies inherent in most of our processing vendor contracts.
Speaker Change: As a percentage of extra cash origination volume, these costs improved to 0.5% from 0.7% in Q1 of last year.
Advertising and marketing expenses increased 13% year-over-year to 10.3 million.
Speaker Change: We expect to opportunistically expand marketing investment over the remainder of the year with a moderate step-up in spend during the summer months to capitalize on the higher levels of demand for extra cash during that period.
Speaker Change: Compensation-related expenses increase 12% year-over-year to 27.5 million, primarily driven by stock-based compensation tied to performance-based restricted stock units and payroll taxes triggered by the vesting of these awards during the quarter.
Speaker Change: Excluding stock-based compensation, compensation as a percentage of revenue felled in 19% from 25% a year ago, highlighting the inherent operating leverage provided by our technology platform and scalable cost structure.
Speaker Change: GapNet income declined to 28.8 million from 34.2 million in Q1 of last year due to the 33 million dollar non-recurring gain from the discounted convertible note repurchased during the first quarter of 2024.
Speaker Change: Our year-to-date effective tax rate was approximately 15 percent and we estimate our 2025 annual effective tax rate to range between 21 percent and 23 percent.
Speaker Change: Adjusted net income, excluding non-recurring items, stock-based compensation, and non-cash liabilities increased nearly 350% to $36.3 million from $8.1 million in the year ago period.
Speaker Change: Similarly, adjusted EBITDA reached $44.2 million, more than tripling the $13.2 million generated in Q1 of last year, driven by our revenue growth, variable margin expansion, and operating leverage, with flow through from revenue growth to EBITDA growth of more than 90%.
Now, turning to the balance sheet.
Speaker Change: Our overall liquidity remains strong. As of quarter end, we had approximately 89.7 million of cash and cash equivalent marketable securities, investments and restricted cash compared to 91.9 million as of the end of 2024.
Speaker Change: This decrease was primarily driven by two factors. First, we invested over 20 million of cash to reduce our share count through share repurchases and the RSU net settlement transaction we discussed on our last poll.
Speaker Change: Second, net receivables grew by roughly 19 million quarter over quarter, which we chose to self-fund with existing cash, as we believe it represents an attractive use of capital at this time.
Speaker Change: As a whole, we invested upwards of $40 million of balance sheet cash in these two areas. We'll total cash, cash equivalence investments with down just over 2 million versus prior quarter end.
Speaker Change: I bring this up to highlight the significant amount of free cash flow that we're generating and our high conversion of earnings to free cash flow.
Speaker Change: Additionally, as of quarter end, we had approximately 100 million of borrowing capacity under our credit facility, resulting from our decision to use balance sheet cash to fund portfolio growth over the past several years.
Speaker Change: We have the ongoing ability to tap this source of capital, providing us with additional flexibility to pursue capital allocation opportunities such as M&A and capital return to drive value creation.
Speaker Change: On the topic of capital return, and March, our Board of Directors authorized a $50 million share repurchase program, reflecting our confidence in the company's financial strength, long-term growth trajectory, and expanding free cash flow profile.
Speaker Change: We view this program as a strategic capital allocation tool and a compelling way to drive shareholder value.
Speaker Change: We began executing against this program in March, repurchasing approximately $7 million of
Finally, Turning the Guidance [inaudible]
Speaker Change: For the full year of 2025, we are raising our revenue outlook to a range of 460 to 475 million representing 33% to 37% growth year-over-year and a 42.5 million dollar increase at the midpoint compared to our prior guidance.
Speaker Change: We're also raising our adjusted EBITDA guidance to 155 to 165 million, reflecting approximately 79 to 91% growth versus 2024 and a $45 million increase from our previous outlook.
Speaker Change: In closing, our strong momentum and positive results underscore the central role we play in our members' financial lives.
Speaker Change: We remain confident in our strategy, encouraged by the demand for our products, and energized by the opportunities ahead. We look forward to continue to deliver meaningful value to both our members and shareholders throughout 2025 and beyond.
and with that.
Speaker Change: We can now open up the line for questions. Thank you.
Speaker Change: If at any time your question has been addressed and you would like to withdraw your question, please press star and then two.
Speaker Change: Our first question comes from Devin Ryan, Whip Citizens, please go ahead.
Hey Jason, it's Kyle, good morning, how are you?
Speaker Change: Hey, good morning, Devin. How are you? Hey, Devin. How are you? I'm doing great. Yeah, really impressive results here. I want to start with a two-part question on extra cash. It's a 12.4 members today.
Speaker Change: It's more than doubled over the past three years. I've heard the positive outlook on bedrock acquisition.
Speaker Change: As we think about kind of where this product specifically is going, can you give us an update on your thoughts of where you are on market share of people that are likely or would potentially consider a product like extra cash and then
Speaker Change: You know, I'm not sure if there's a good way to frame this, but on average, you know, is the advances go up in size? Is there a point where that will lead to fewer advances per member? So you need kind of hit a tipping point there where maybe it becomes a drag. I don't know, but I'm just curious on both of those things.
Speaker Change: So on the first question I'd say, we're at 2.5 million mTMs in this coin. We feel the man is still massive of that half of America, roughly 150 million mTMs.
Speaker Change: Effectively, it's still due on your next paycheck date, and so all we're doing is, I think, with the increase, giving people more flexibility of how they can utilize extra cash, they can use it more for things like rent or for larger purchases versus our previous limits from lower. So, tended to only be used for gas and groceries.
Speaker Change: As far as where we go from here, we do believe our members aspire for more duration on extra cash. So, that's where sort of new products could enter the market for us, which we're excited to talk about at Future Force.
Speaker Change: Sure, it's faster and cheaper to access credit using our own card, but we do plan to spend more resources on that product to find new ways to drive further across attach and ultimately more direct deposit.
Royal: Got it okay Royal appreciate it guys and congrats on the great quarter.
Speaker Change: Thanks, a lot and the next question comes from Joseph Vathy with Canaccord. Please go ahead, hey, guys. Good morning terrific results. Congrats is there any have you I mean I know, it's a little early on the new Pri.
Speaker Change: Doug have a tax season effect to it you've seen any correlation between the new price structure.
Speaker Change: And credit performance is you know there's a new price structure, you know have any effect on that that you can see and then a quick follow up after that.
Speaker Change: Thanks for joining Joe This is Kyle to answer the question about the relationship between credit performance and and our new pricing model. We just haven't seen any changes there in terms of like something like adverse selection or anything like that that might have occurred.
Speaker Change: Standpoint, and I think the upside on the size for origination as well as the average revenue per origination speak to the business benefit So credit performance in Q1 hit an all time low and we've been a really good about managing credit.
Speaker Change: Here, that's great. That's great feedback and then you know I mean, the guide looks great and you know an impressive increase there if we kind of double click on that a little bit more you know should we assume.
Speaker Change: Or is the guy assuming you know further arpoo increases are you really just holding the line on the run rate on the newer guide and then I guess any kind of changes to MTM growth that we should be thinking about moving forward. Thanks a lot.
Speaker Change: Certainly we would expect to continue to grow MTM throughout the year I think naturally we'll get some benefit on the ARPU side, just by virtue of having a full quarter's benefit in Q2 onward on the new pricing structure, so that should support.
Speaker Change: Expansion from here as well, but we're going to continue to focus on the other ARPU levers at our disposal, namely kind of continuing to pull good risk up the limit spectrum by increasing offer amounts and that should drive overall monetization.
Speaker Change: Both on the M T M's and RPU side, feeling like there's opportunities to continue to kind of pull levers on on both eyes dimensions sure. That's great. Congrats guys really good results.
Speaker Change: Thanks, So much and the next question comes from Hal Gotes with B. Riley. Please go ahead, hey, good morning, guys terrific results. Thank you very much on that you mentioned a reengagement of any.
Hal Gotes: I'm actually always have a few are you are you seeing like you know kind of celebration of that and then what are the thoughts on you know these average origination sizes are getting larger and are you.
Hal Gotes: A different kind of customer now maybe has higher WTO income or is it just that the cash AI is granting through repeat borrowing you know people promoted themselves to hire amounts if they wish to take them wonderful though.
Hal Gotes: So I'd say no changes on the reactivation of customers I mean, we're doing a great job there per usual, but nothing out of the ordinary I would say how sort of business as usual as far as the original amounts going up it.
Hal Gotes: We have a significant amount of our base is repeat customers and so the longer time on book, we will increase limits there, but I'd say, we are doing a better job of offering better credit for new customers as well and that's also supported by the new fee structure, allowing us to have.
Hal Gotes: With the new monetization, so I'd say, it's a combination of of those things I'd say lastly, I touched on this a little bit the script, but yeah. We're just saying our credit class of how short duration, how fast the repayment cycles are just puts us in a different category than a longer doro.
Hal Gotes: Do you think of your AI model allows for slightly higher you know initial first time advances to people. The user experiences goes up is like imagine if you only grab someone 30 or 40 Bucks you're like what did that didn't do me a whole lot Oh yeah.
Hal Gotes: Absolutely correlation between better first time limit and better first time conversion excellent okay excellent.
Hal Gotes: Yeah, Yeah, I mean, that's why the you know the increased limits is such a business and customer win win right as we move people up the limit curve even for first time customers. You know just the the value proposition increases, we obviously as a business benefit from that Inc.
Hal Gotes: And so yeah. It's just it's just a win win and that's where I feel like you know I made some remarks about this and and the script as well where we've just built this you know positive flywheel for the business as we continue to improve on credit performance and have more training data because we can just offer.
Hal Gotes: Amounts, which is just a better value proposition for our customer. So you definitely seeing the benefits of that play play out yeah last one I'll need on coastal you know opportunity to do a little bit longer duration, you mentioned that on the Q4 call is those.
Speaker Change: Julia 2026 event or can we see the first.
Hal Gotes: Roll out of those and later in the year I don't think you'll hear a talk about results until next year. Okay.
Hal Gotes: And the next question comes from Jacob Steven with Lake Street Capital Markets. Please go ahead, Hey, guys. I. Appreciate you taking the questions and I'll Echo the congratulations on the great quarter.
Jacob Steven: I just wanted to touch on the customer acquisition cost up $2 sequentially. Maybe you could kind of highlight you know what are you doing differently you know why the increase from before.
Speaker Change: Jacob get to hear from you. We are very focused on channel optimization and continue to drive our channels based on just LTB and so if you look at our capped LTV. Our ratios are have never been better from that perspective as LTT.
Speaker Change: Yeah, and maybe you could just kind of touch on what some of those channels are that you're you're actually seeing a better return on.
Speaker Change: Nothing really to share there, although any point to a little more spending towards iOS devices versus Android seeing some some better conversion lifetime value there at a little higher CAC.
Speaker Change: Okay interesting maybe last one for me then the Dave credit product I know you guys have talked about that in the past maybe any update on that do you expect kind of a later launch this year or maybe that's pushed out till 26.
Speaker Change: I'd say, we're still targeting friends and family for a later this year and we'll hopefully talk about some results starting next year.
Jeff Cantwell: Okay got it appreciate the questions. Good luck. Thanks, so much and the next question comes from Jeff Cantwell with Seaport Research. Please go ahead.
Jeff Cantwell: Thank you first of all congrats on the results can you be drilled down a little more about it yeah card what what do you see from customers right now on that for it looks like you see greater engagement on that product spend volumes were up there by 24%.
Jeff Cantwell: There's a lot of traction how are you thinking about that of a balance of the year, maybe just on a related note irpus now 171 that was up 29% do you mind just walk us through the puts and takes there as far as growth. If you think about balancing driving new member acquisition against also this.
Jeff Cantwell: I'm keeping immeng.
Speaker Change: Yeah, sorry, the first question was around date card and what exactly.
Speaker Change: I'm, just trying to get a sense of what you're seeing in terms of traction and and how you're thinking about that going forward over to balance of the year in terms of growth.
Speaker Change: Yeah as I mentioned the first question. We we are seeing just really nice organic synergy between extra cash in the Dave car, we're not really doing a lot there historically on incentives to drive that adoption other than the fact, it's faster and cheaper to access extra cash with the Dave card.
Speaker Change: Some ideas right now around rewards to drive further incentives as we do have increased margin with the new fee structure and so excited to see how we can play around with the further incentives to get more adoption, there and ultimately direct deposit, but as you pointed out nice growth nearly 500 million.
Speaker Change: It's still excited about that product opportunity.
Speaker Change: Got it and maybe can you describe some thoughts on artu as well. That's 171 I was up 29, just walk in puts and takes there you're thinking about the remainder of the year look I'd say, that's margie driven by the new structure.
Speaker Change: It's a more durable monetization than our previous model of instant transfer fees and tips, especially as customer stay longer on book, we had not an insignificant amount of customers that work no longer tipping and no longer using the insome transfer feature and therefore moving people to the structure.
Speaker Change: Ability to forecast the business and it's it's really showing its teeth and the higher ARPU growth and as Kyle pointed out we only had the new fee model rolled out for 60% of the base and so Q2 will be our first quarter of 100% rollout on the fee. So we should expect to see furtherex.
Speaker Change: Yeah, No just add to that as we continue to try and drive further adoption of the Dave card among the base that's another lever for ARPU expansion.
Speaker Change: And then you know outside of that the other levers that I I talked about which is continued sort of optimization of the of cash AI to move people up the limit spectrum to hire average origination sizes also a tailwind and a lever for our extension.
Speaker Change: Get about our ability to continue to make improvements there, especially in light of the new fee model as Jason alluded to the great thing about the new structure is that we're fully incentivized from a modelization standpoint to take incremental risk.
Speaker Change: Serve because we're getting paid for that for those incremental risk dollars. So you know, it's again kind of a nice alignment of the business and customer.
Speaker Change: Got it great. Thanks, very much congratulation results.
Speaker Change: And the next question comes from Gary Prestapino with Barrington. Please go ahead.
Gary Prestapino: Good morning, Jason Kyle How're, you guys doing [laughter].
Speaker Change: Doing well how are you Oh, just great. Thanks, Hey.
Speaker Change: Couple of questions your first of all.
Speaker Change: You know Jason you did mention something about repeat users of the product and I think you're allowed to.
Gary Prestapino: Extra cash originations per month is that correct or am I wrong. There that's correct well I guess I said just to like clarify Gary it could be higher if you're on a weekly pay sickle. So it really is line to the Paycycle you know most people do get paid every two weeks, but we do have you know.
Gary Prestapino: She gets paid weekly and so they would be able to use extra cash more than twice okay.
Speaker Change: What I'm getting at here is with your 2.5 million.
Speaker Change: Monthly transaction members is it I'm trying to get an idea of like say the lifetime value of the account and all that how many of those people that are on there you know do multiple transactions.
Speaker Change: On extra cash and the Dave card and have really done multiple transactions over a six month period, I guess, what I'm getting out of that you know are you seeing in your at least the majority of your monthly transaction member basis, maybe.
Speaker Change: Correct as more or less their bank a standard bank product versus you know using a traditional brick and mortar bank.
Speaker Change: I would say, we talk about our direct deposit penetration like the true customers that would think of David as our primary account still you know sub 10%, but if you think about the customers that are taking extra cash a couple of times per month, they're spending it on their gas and groceries. We're.
Speaker Change: They're sort of essential spending and that's a we think a big win and a good sign of us taking more market share away from the larger banks. Okay. And then just to add maybe a little bit of color there Gary in terms of the Rep U.
Speaker Change: And the type of engagement that we see amongst the base you know call. It between 97 and 98% of dollar value originations go to repeat customers and you given month or quarter and that number is continues to go up and up as.
Speaker Change: All base continues this season.
Speaker Change: And so you know amongst that kind of 97% to 98% you know many of those customers are the the median have transacted with Dave on extra cash you know 20 to 30 times and so just a strong sort of rep.
Speaker Change: I'd say rarely significant type of relationship that we have with these customers and we're seeing them. All the time. So has us feeling really good about sort of the proximity that we have to these users and our ability to kind of cross all them things over time just.
Speaker Change: Yes.
Speaker Change: Okay. That's helpful. And then just on your guidance in terms of what you've given here are are you contemplating some increases for product development, adding people anything of that nature.
Speaker Change: As we go forward throughout the year.
Speaker Change: Yes, you know as I mentioned in my remarks, we are going to be making some very disciplined investments in product development and data capabilities throughout the year. I mean these are not you know large numbers I think you know, we but we are continuing to add.
Speaker Change: To support you know strategy and in key initiatives. Additionally, we do plan to ramp marketing spend over the subsequent quarters, which you know if you look at Q1 over Q1 of last year I think is a good indication of where market.
Speaker Change: Okay. Thank you very much.
Speaker Change: This concludes our question and answer session. The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.