Earnings Call Transcript
Chime Financial, Inc. (CHYM)
Earnings Call Transcript - CHYM Q4 2025
Operator, Operator
Good afternoon. Welcome to Chime's Fourth Quarter Fiscal 2025 Earnings Call. As a reminder, this conference call is being recorded, and a replay of this call will be available on our Investor Relations website for a reasonable period of time after the call. I'd like to turn the call over to David Pearce, Vice President of Investor Relations and Capital Markets. Thank you. You may begin.
David Pearce, Vice President of Investor Relations and Capital Markets
Good afternoon, everyone, and thank you for joining us for Chime's Fourth Quarter 2025 Earnings Conference Call. Joining me today are Chris Britt, our Co-Founder and CEO; and Matt Newcomb, our CFO. Mark Troughton, our President, will participate in the Q&A. As a reminder, we will disclose non-GAAP financial measures on this call. Definitions and reconciliations between our GAAP and non-GAAP results can be found in our earnings release in our earnings presentation posted on our IR website at investors.chime.com. We will also make forward-looking statements on this call, including statements about our business, future outlook, and goals. Such statements are subject to known and unknown risks and uncertainties that could cause our actual results to differ materially from those described. Many of those risks and uncertainties are described in our SEC filings, including our Form 10-Q filed on November 10, 2025. Forward-looking statements represent our beliefs and assumptions only as of the date such statements are made. We disclaim any obligation to update any forward-looking statements, except as required by law. With that, I'll hand it over to Chris.
Christopher Britt, Co-Founder and CEO
Thanks, David, and thank you all for joining us. I'm proud to report another strong quarter. In Q4, we again delivered results that exceeded our guidance, closing out a momentous year. But before I get into the details, I want to reflect on 2025 and preview plans for a year of acceleration in 2026. Despite headlines of a pressured consumer, we continue to see stability, consistent with what we reported last quarter. Member spending remained healthy in Q4 and with steady growth across both discretionary and nondiscretionary categories among our tenured cohorts and across all income levels. We're seeing higher average deposit balances and consistent use of our liquidity products with lower losses, including all-time low loss rates on MyPay, and importantly, no signs of increasing job loss within our member base. Our business is rooted in primary account relationships and everyday, largely nondiscretionary spending. So we're built for resilience. In times of uncertainty, our value proposition becomes even more compelling. Fee-free access to liquidity, payroll on-demand, high-yield savings, credit building, tools that help members build financial stability. In 2025, we delivered 31% revenue growth with strong operating leverage, including a 12-point year-over-year improvement in adjusted EBITDA margin to 10% in the fourth quarter. In Q4, we also added approximately 500,000 net new active members, bringing our total to 9.5 million. In 2025, our biggest unlock was ChimeCore, our homegrown transaction processor and ledger. We're now 100% on our own tech stack after completing a multiyear migration in Q4. ChimeCore strengthens our cost advantage with a cost to serve of roughly 1/3 of large banks and 1/5 of regional banks. ChimeCore also reduces transaction processing costs by an estimated 60%, supporting our long-term gross margin target of 90%. But the bigger impact for us is velocity; owing our own tech stack enables us to innovate faster and deliver the lowest cost products to our members. That unique advantage powered our 2025 product launches extending our lead over traditional banks and fintechs as the most rewarding place for mainstream America to bank. For example, Chime Card, our new secured cash-back credit card and first product built entirely on ChimeCore. Direct depositors earn 1.5% cash back on everyday spending, a 3% savings rate, which is 7x the national average, fee-free overdrafts, early access to pay, free credit building that increases average scores up to 70 points, and access to a free ATM network that's larger than the 3 biggest banks combined, all at no cost. No other company offers this breadth of services for everyday consumers, and we deliver it with an over 70% transaction margin. Chime Card is already resonating at the top of the funnel and driving strong engagement. Over half of members in our new cohorts are adopting it, and those members are using it for over 70% of their Chime spend. This has resulted in credit spend as a percent of overall purchase volume increasing to 21% in December, up from 16% in September. As a reminder, spending on Chime Card earns us nearly 2x the take rate of our debit card serving as a multiyear tailwind to revenue growth. MyPay, our on-demand payroll product, had a standout year. We scaled MyPay to over $400 million in revenue run rate in Q4, while generating transaction margin of nearly 60%, only 1 year after launch. We began 2025 with MyPay loss rates of 1.7%. And in Q4, we reached our steady-state loss rate target of 1%, significantly faster than planned. With losses stabilized and a new variable pricing model in place, we can now scale both access and profitability. We're focused on making MyPay available to more members with higher limits and on driving growth in transaction profit dollars while maintaining MyPay as the low-cost product in the market. We also launched Chime Workplace, our employer financial wellness offering, bringing Chime into the enterprise channel with MyPay at Work. We saw early traction in 2025, onboarding our first customers and channel partners, and we entered 2026 with strong momentum and a growing pipeline. More broadly, our progress across liquidity products showcases our structural repayment advantage that comes from deep primary account relationships and enables low cost, low credit risk liquidity offerings. Across SpotMe, MyPay, and Instant Loans, we exited the year at over $40 billion in annualized origination volume. In 2025, we also cemented our position as the primary bank account of choice for mainstream America. In terms of brand consideration, Chime is now #1 for online banking among Americans earning up to $100,000 a year based on third-party survey data. In 2026, NerdWallet named Chime the Best Checking Account and Best Online Banking Experience. And last year, TIME's National Consumer survey recognized us as the #1 brand in banking. Our marketing isn't just driving awareness, but also primary account intent. Recently, J.D. Power named Chime the leader in U.S. checking account openings, ahead of all other financial institutions. They estimate that 13% of all new checking accounts opened in the U.S. were at Chime, nearly 50% more than the #2 brand on the list, Chase, and above a long tail of other U.S. banking and fintech brands. Our momentum in 2025, combined with the launch of ChimeCore, sets the foundation for accelerating product velocity in 2026. This year, we're focused on 3 priorities to advance our growth agenda. First, we're going to extend our lead as the best financial partner for everyday consumers. In the coming weeks, we'll launch a new premium membership tier with an even more rewarding value proposition for our most engaged and higher-earning members, including those making more than $100,000 a year. It will deliver higher savings rates, exclusive perks, and even better rewards, all fee-free while maintaining our advantaged unit economics. We're also expanding our product suite to meet the needs of our fastest-growing segment. Members earning $75,000 a year and more by introducing new value propositions to address more complex needs, deepen engagement, and drive long-term growth and profitability. For example, we'll launch joint accounts as well as teen accounts and custodial accounts, so members can more easily manage shared family finances. This summer, we'll be expanding into investing, automated and self-directed, and we will support Tax Refund Accounts. These offerings provide members with new and accessible ways to build wealth. With tax season underway, we're increasing awareness of Tax Refund Accounts among millions of eligible everyday Americans, broadening access and participation at scale. That translated into strong early traction with tens of thousands of members initiating enrollment through tax filing with Chime in the first week alone. Our second priority is accelerating momentum in our enterprise channel. Chime is transforming the direct-to-employer earned wage access industry by delivering a full suite of financial tools and pay on demand for free for employers and employees. We've seen a strong response from the market, including a growing roster of employer partners and channel partnerships like Workday and UKG. Our offering is resonating with employees. Among early cohorts, adoption is high, and these members are transacting more and retaining better than new cohorts in our direct-to-consumer channel. In 2026, our focus is scale. Expanding to more employers and building enterprise into an evergreen customer acquisition channel. We're off to a strong start, and we recently announced several new employer partners and expect additional announcements in the very near future. And finally, we'll continue to deeply embed AI across Chime and into the member experience. A lot has been written about the financial literacy gap in our country, and it's real. More than half of U.S. adults lack basic financial knowledge. And even when people are educated, they often lack the tools, the support, and consistency needed to take action and turn good intentions into lasting financial progress. That's why we're excited to expand our consumer AI offering. Chime's relationship with our members is fundamentally different than most fintechs. The majority of our members rely on Chime as their primary account, and our average member engages with us 5 times per day. We sit at the center of our members' financial lives, and that depth of engagement allows us to not just provide insights but to take intelligent real-time action with and on behalf of our members. In Q2, we'll launch the next generation of our consumer AI offering, Jade. With the vision of delivering an always-on financial copilot embedded in-app, providing personalized guidance that helps members take action automatically and make smarter financial decisions. We're currently testing Jade with employees, which gives us valuable feedback ahead of launch. With Jade, we'll move from reactive tools to more proactive financial management, helping members spend smarter, save more, pay bills on time, borrow responsibly, and build long-term wealth, transforming the way mainstream consumers manage their finances. Beyond Jade, AI is already transforming how we operate. Over the past 3 years, we've reduced our cost to serve by nearly 30% and increased our ARPAM by 23%, all while improving customer satisfaction levels. AI has driven step-change efficiency across customer support, reduced fraud rates by 30% since 2023, and meaningfully increased internal productivity. We boosted developer throughput cut code review times and more than doubled marketing creative output while reducing production costs. In disputes, automation has reduced time to decision by 30% while maintaining over 99% accuracy, delivering faster, high-quality resolutions for our members. This is the leverage of a technology-first financial services company embracing AI at scale, grounded in relentless member obsession. We innovate faster, deliver better experiences, and operate at a fraction of the cost of legacy players. This allows us to deliver more value to our members, and these advantages compound as we grow. Last year, we generated nearly $2.2 billion in revenue with approximately 1,500 employees. As we shared on our last call, we expect to continue to scale without needing to add headcount. I'll now turn it over to Matt to cover Q4 and our 2026 outlook.
Matthew Newcomb, CFO
Thanks, Chris. Q4 capped off a landmark year for Chime, our shareholders, and our financial position. We went public, strengthened our balance sheet, and continued to drive strong financial results. In 2025, we delivered 31% revenue growth and significant operating leverage, growing our adjusted EBITDA margin by 12 percentage points year-over-year in Q4, each ahead of our guidance. We expect to maintain this momentum in 2026 with a clear line of sight to strong growth and further operating leverage, including GAAP profitability for the balance of the year, an important milestone that we expect to achieve ahead of previous internal expectations. But first, let's discuss Q4. Our third consecutive quarter of strong results as a public company when we again exceeded our prior guidance on both top and bottom lines. We grew revenue by 25% year-over-year and transaction profit by 31% year-over-year in Q4, compounding growth even as we fully lapped 2024's launch of MyPay. We've done this by continuing to execute across multiple dimensions of growth: active members, average revenue per active member (ARPAM), and transaction margin. In Q4, we added approximately 500,000 net new active members quarter-over-quarter and 1.5 million year-over-year. Of course, our actives aren't just any actives. They're deeply engaged, a result of our relentless focus on serving our members in a primary account capacity. Our average active member transacts with us 55 times per month; that is very different from other fintechs with single-point solutions whose comparable metric is often in single digits. We have a fundamentally different customer relationship. Primary accounts drive consistent and resilient top-of-wallet spend, provide us with an underwriting advantage through our privileged repayment position, and give us a unique opportunity to cross-sell and deepen engagement even further over time. This results in consistent, durable, and long-lasting member cohorts. Our oldest cohorts are now nearly a decade old and are generating more transaction profit now than they did pre-COVID, and that's net of churn. And our cohort performance is getting even better. Building on our success in H1 with our early engagement initiatives, which made it easier to get started with Chime, in Q4, we improved the quality of our new cohorts in several other areas. First, in Q4, we saw a record high number of new members convert to direct deposit. Second, we continue to grow engagement. Our new cohorts are attaching to more products faster, including with many of the products we launched and scaled in 2025, like our new Chime Card, MyPay, Outbound Instant Transfer and Instant Loans. Members using 6 or more products each month now make up 15% of our actives, up from 5% 2 years ago. Finally, fueled by these increasing levels of product attach, we've also grown monetization. This is particularly true in our newest cohorts; we are seeing members do more of their spending on Chime Card, compared to prior cohorts that transacted more on debit. Chime Card earns us approximately 175 basis points on purchase volume, compared to under 100 basis points on debit. Taken together, we've strengthened the quality of our new member cohorts while continuing to acquire at attractive customer acquisition costs (CAC), yielding 5 to 6 quarter transaction profit payback periods, and lifetime value to customer acquisition costs (LTV to CAC) of over 8x. In Q4, overall ARPAM increased 5% year-over-year and 21% over 2 years to $257, driven by the strength in both payments and platform-related revenue. Our tenured cohorts have reached ARPAM of nearly $400. In terms of transaction volumes, we continue to see very steady spend trends consistent with a resilient consumer. Combined purchase and outbound instant transfer volumes grew 16% in Q4, fueling payments and outbound instant transfer revenue growth of 21% year-over-year, an acceleration from Q3, driven by higher take rates on Chime Card and outbound instant transfer. Platform-related revenue increased 47% year-over-year or 37% year-over-year, excluding outbound instant transfer. One additional contributor to ARPAM growth is Instant Loans, our up to $1,000 installment loan product with terms of 3 to 12 months. Instant Loans complement our short-term liquidity product offerings to meet our members' larger, more episodic liquidity needs. We originated approximately $400 million of Instant Loans in 2025, and as of Q4, 10% of active members had an open loan. We expect Instant Loans to scale further in 2026, and like we demonstrated with SpotMe and MyPay, unit economics improve significantly as the portfolio matures. We've seen as much as 50% lower loss rates for repeat borrowers compared to first-time borrowers. In Q4, we increased transaction margin to 72%, up from 69% in Q3, a result of delivering on 2 critical strategic priorities that we committed to as part of our IPO last summer: completing our ChimeCore migration and reducing MyPay loss rate to 1%. In addition to the velocity and innovation benefits that ChimeCore unlocks, the final stage of our migration also drove a 200 basis point increase in our gross margin, helping us close in on our long-term target of 90%. This improvement alongside our faster-than-expected progress to our 1% steady-state loss rate target on MyPay, helped us grow annualized transaction profit to $1.7 billion in Q4, up 31% year-over-year. Finally, alongside our strong growth, we continued to drive operating leverage with $57 million of adjusted EBITDA in Q4. In Q4, non-GAAP operating expenses as a percent of revenue fell 9 percentage points year-over-year. Our adjusted EBITDA margin growth accelerated further with a 12 percentage point improvement year-over-year in Q4, the largest margin improvement of any quarter in 2025. In our first call as a public company, we committed to delivering an uptick in profitability in the back half of 2025, and that's exactly what we did. The 57% incremental adjusted EBITDA margin we delivered in Q4 exceeded our initial guidance as well as the higher bar we set for ourselves on our last call. So meaningful progress last year, but we're even more excited about the opportunity ahead. We believe we're extremely well-positioned entering 2026 with a number of tailwinds that will support both continued strong top line growth, even faster transaction profit growth, and further bottom line margin expansion this year. First, we're the market leader in account openings and the #1 brand in banking. In 2026, we expect to continue delivering steady and predictable growth in our core business, powered by a growing member base and their resilience everyday nondiscretionary spending. Second, we have several strong top line tailwinds exiting 2025, including Chime Card driving higher take rates, a new variable MyPay pricing model unlocking further scale and higher monetization. In our Instant Loans products ramping across our member base with strengthening unit economics. Third, our new products and go-to-market priorities that Chris outlined, including new premium membership tiers, investment accounts, joint accounts, and Chime Enterprise will set the stage for continued growth in 2026 and in years to come. Finally, we'll do all of this without needing to grow our headcount, thanks to efficiencies from ChimeCore and our ongoing AI initiatives. Turning to our guide. In Q1, we expect revenue between $627 million and $637 million, resulting in year-over-year revenue growth between 21% and 23%. We expect adjusted EBITDA between $90 million and $95 million and adjusted EBITDA margin of 14% to 15%. For full year 2026, we expect revenue between $2.63 billion and $2.67 billion, resulting in year-over-year revenue growth between 20% and 22%, and adjusted EBITDA between $380 million and $400 million. An adjusted EBITDA margin between 14% and 15%. This represents 8 to 9 points of margin expansion year-over-year and an incremental adjusted EBITDA margin of over 55%. As mentioned previously, we expect to be GAAP profitable for the balance of the year. There are a few things to keep in mind about our Q1 and full year outlook. First, we have a seasonal business; specifically, Q1 is tax refund season, but we like to call it the most wonderful time of the year. Each Q1, with the increased activity resulting from members receiving their tax refunds, we see seasonally higher purchase volume, ARPAM, transaction margin, and net new active member additions. And in each Q2, we see a normalization of these seasonal trends, with significantly fewer net new active member additions than in other quarters and lower sequential purchase volume, payments revenue, and transaction margin. This Q1, we also expect to benefit from larger-than-usual tax refunds resulting from the One Big Beautiful Bill Act, which would magnify the seasonality. It's still early. We haven't yet hit the peak of tax season, and the timing of this year's refunds are a bit later than in the years prior. That said, so far, refunds are tracking higher, in line with our expectations. More broadly, for the full year, we will continue making progress across our growth framework, active members, ARPAM, and transaction margin. As the market share leader in new account openings, we expect to maintain strong momentum in net new active member additions this year. For the full year, our goal is to add approximately 1.4 million net new actives at attractive ROI, building on the increasingly strong cohort quality we saw in Q4. We will also continue to drive ARPAM growth as we scale Chime Card, MyPay, and Instant Loans, helping us grow LTVs and reinforce our strong cohort quality. Finally, we expect transaction margins to remain consistent with Q4 2025 levels as we realize the ongoing benefits of lower transaction processing costs from our ChimeCore migration. From an operating expense perspective, as Chris noted, we're excited about our road map this year and plan to invest in sales and marketing behind our new product launches, particularly in Q2 when we plan to launch our new premium membership tier. With that, I will open it up to Q&A.
Operator, Operator
Our first question comes from Tien-Tsin Huang from JPMorgan.
Tien-Tsin Huang, Analyst
Great results for you guys. I want to ask a couple of member questions, if that's okay. Just curious, and thanks for the outlook and all the details that you gave. I know there's been a lot of talk in the past about widening the product funnel. I'm just curious if you're getting the member behavior reaction that you're looking for from those actions and how you might do that differently in '26 versus '25 in terms of member growth focus? I heard, Chris, you talked about the premium tiering and the new strategy there. I think that's great. I'm curious, are you solving for new member growth there or higher engagement retention, that kind of thing as you're thinking about the outlook in '26 and beyond?
Christopher Britt, Co-Founder and CEO
Thanks, Tien-Tsin. Yes, maybe just as a setup and a reminder for folks on the call. A little over a year ago, we kicked off a series of initiatives to try to make the top of the funnel even wider, if you will. So we did things like made it easier to fund the Chime Account, to get access to certain features like credit building and our Outbound Instant Transfer feature right out of the gate. I think there's no question that this has been a positive development for our top-of-the-funnel numbers, and you can see it in the results. In the prepared remarks, we talked about the J.D. Power survey that showed Chime is opening up more checking accounts than any player in the industry, 50% higher than the #2 player, Chase. Going forward, we intend to continue to be the market leader in terms of new checking account openings. We're excited about the new product innovations that we'll be rolling out in some of these new channels that I'm sure we'll talk about more on the call to ignite our growth. We're going to do that while continuing to manage towards increasing levels of profitability. We're also seeing that these new cohorts that we're bringing in are delivering high-quality members into the fold, and maybe Matt can talk to what we're seeing on that front.
Matthew Newcomb, CFO
Thanks Chris. Yes, I agree. We are pleased with the overall pace of new active members. However, what excites us most is the quality of these new active groups, which continues to improve. We have been setting record highs in the number of new members who have converted to direct deposit, and our early engagement initiatives have contributed to this success. We are significantly enhancing engagement and increasing monetization, particularly among our newest cohorts who are adopting the Chime Card at a strong rate. We are confident in our progress, which is reflected in our cohort metrics. Our transaction profit payback periods have strengthened to 5 to 6 quarters, supporting a long-term lifetime value to customer acquisition cost ratio of over 8 times. At the enterprise level, strong cohort performance is leading to substantial growth in profitability, which we are balancing with our goals. Overall, we feel positive not only about the quantity but also importantly about the quality of our active member growth as we enter the year.
Christopher Britt, Co-Founder and CEO
And maybe just a follow-up on the other questions you asked, Tien-Tsin. I don't think we would do much in the way of anything different. We really like this opportunity to have more active members in the mix and have them have a relationship with Chime because we know that the point in someone's life that they make a conversion to direct deposit is different. It might be the result of a life change or a new job. So the more people that we can have relationships with so that we're in the mix at that moment of time, we think that's a great place to be. As it relates to the question about the new product membership tiering, that's really just based on our analysis of our member base and the fact that we can see we're growing among our higher income level members. We're growing that at a nice clip. We want to make sure that we have products and services that really deliver great value to them. So that's what you should expect to see in new tiers: members who give us more of their direct deposit are going to get even more rewarding experience using Chime as their primary bank account. Yes, I guess it's intended to open up that segment of the market even further and make sure that we are giving ourselves the best chance of retaining those higher income numbers as well.
Tien-Tsin Huang, Analyst
Like Chris, anything to call out on the competitive landscape, thinking about what you're seeing from your peers? And is that impacting member behavior at all? I'm especially curious as we go into tax season if you're seeing any change in customer acquisition strategy from the group?
Christopher Britt, Co-Founder and CEO
I believe, as Matt mentioned, tax season is always a strong period for us. Our tax preparation service is receiving significant engagement. Even though it’s early in the season, we are already observing many tax refunds being deposited in accounts. Many individuals are signing up for Tax Refund Accounts and initiating that process along with their tax filings, which is very promising. I think this is a positive trend for our nation, especially for the everyday consumers we cater to. We are consistently monitoring the competition. Most primary checking account relationships in the U.S. are held by large banks, and we continue to perform better compared to them. We are also keeping an eye on other fintech companies that are entering the market segment where we have achieved some success. Therefore, while we are observant, we feel very confident about our current position.
Operator, Operator
We'll move next to James Faucette with Morgan Stanley.
James Faucette, Analyst
I appreciate all the color here. I wanted to ask you just on kind of the activity levels and continuing to add users at a pretty good clip. I’m wondering how we should think about that in context of your efforts to really ungate more products to more of your customers? What you're learning from that process? How we should expect refinement during '26? And I guess, really what we're kind of looking at is - is there a possibility that we could even see some acceleration from a pretty consistent rate of member growth?
Christopher Britt, Co-Founder and CEO
Right. Thanks for the question, James. Like we said, we feel really good about the efforts and the impact of opening up the top of the funnel, and Matt sort of shared some of the highlights. Our payback periods on our customer acquisition are as good as they've been in a really long time and getting better. So we feel like these early engagement initiatives are absolutely playing out well for us. We don't anticipate any major changes to them. We're constantly trying to figure out ways to make it even easier to fund an account and to get engaged, to get access to services that are appealing to you. We're going to continue to innovate and test services that allow our members to gain access to trial, temporarily getting access to higher-level tiers if you're not quite qualified for it yet. So we think there are lots of ways to give people a taste of all the benefits of Chime, so that when they have that life moment when it's time to convert a primary banking account relationship, we’re hopefully on that consideration set for them. At the same time, we're seeing huge success building a brand, not just awareness of the brand, but building a brand that is trusted and stands for really a new way to manage your money. It's authentically helpful and easy and in most cases, free.
James Faucette, Analyst
Yes, makes a lot of sense. And then I wanted to touch quickly on credit. Credit mix seems to be improving nicely, especially following the Chime Card relaunch. Any color there? In particular, how has customer response been to rewards on the secured card? Are you seeing incremental spend per user or other things? And I'm just wondering if and how this may tie into some of the plans you have to be attractive even to consumers that are making above $100,000 a year?
Matthew Newcomb, CFO
Thanks, James, for the question, this is Matt. Yes, we're really thrilled about the early progress on Chime Card. Again, that's our new secured rewards credit card. We do think this is going to be a multiyear growth tailwind for us. I think you know this card earns up nearly 2x the take rate versus debit. So it's a really exciting opportunity for us to continue to improve our unit economics. If you just take a look at credit mix as a percentage of purchase volume, you saw that increase from 16% when we launched the card in September to 21% in December. So a 30% increase just in the past few months. In particular, we're really seeing very strong adoption among our newest cohorts. Our newest cohorts over half of them are spending with the Chime Card. Those that do adopt it are using it for over 70% of their Chime spend. On your question, these members are spending more than members who've not adopted Chime Card. So net-net, we're seeing really strong credit mix for these new cohorts. The credit mix of new cohorts specifically is close to 50%. On a go-forward basis, we think there's a lot of opportunity to continue to drive this higher, including through this year's product road map and specifically our new premium membership tier, where we're going to offer even better rewards and exclusive perks while maintaining very similar take rates overall.
Operator, Operator
We'll move next to Andrew Jeffrey with William Blair.
Andrew Jeffrey, Analyst
Great to see things play out as anticipated in the business. I thought I might drill down a little bit into Instant Loans because it feels like that product is moving a little bit more front and center for Chime? And it's an area where we've spent a lot of time and are very bullish, just broadly speaking, short-term consumer liquidity products, which are so much better than alternatives in the market, of course, Instant Loans and MyPay included. Could you just sort of frame up for us how the credit performance is in that particular product, what the growth opportunity is? And maybe just your perspective on how this suite of liquidity products really enhances consumer value as I think there's some confusion or some pushback in the market about fairness and implied APRs and all the kind of stuff that folks don't like about payday loans and credit revolving credit. So kind of a far-reaching question, but I'd just love to get some perspective on your products, in particular, in our overall view.
Mark Troughton, President
Yes, sure. This is Mark. Just to frame Instant Loan. Instant Loan is an installment loan product that, as Matt indicated earlier, our members use for their larger, more episodic needs. Unlike MyPay or SpotMe, which tend to be intrapay period liquidity, this is longer duration. It's anything from 3 months up to a year, we're testing right now. And right now, we're looking at limits anywhere between $300 and $1,000. It's really used for sort of larger, longer-term liquidity requirements amongst our members. This is something we've been testing and you guys have heard us talking about this. We've been testing this for some time now and really refining the risk models and making sure we have this really solid. We're very excited about the performance in '25. We did $200 million of originations, and we reached a 10% product attach rate by the end of Q4. Like all our lending products, Instant Loan is only available to our direct deposit members, who have been with us for a period of time. This is a product where we're actually able to use the privileged data we have in terms of their behavior and our privileged position at the top of the repayment stack to manage the risk here and therefore, actually offer rates that are unmatched for these members in the market. Like any lending product here, what tends to happen is as you start off and certainly with your first-time loans, you tend to have higher losses. What we've really seen here, as Matt has indicated, is as much as a 50% reduction in our repeat loans. We expect the loan performance on Instant Loan to mirror the trajectory that we've seen with SpotMe and MyPay over the years, so it's now at the point where it really is ready to scale. You started seeing some of that in Q4, and you will see that throughout '26. It has become a growth platform for us that we think is going to be a much more meaningful contributor to transaction profit over time. Having said that, these are riskier loans; they're longer duration, higher limits. You're not going to see the sort of attach rates that you would see with something like MyPay. If you were to look at the APRs on a product like this, this is well within the sort of lending 36% APR cap. So this is not a payday loan or even some of the more creative products out there. In fact, it's such a great product that this is actually our highest Net Promoter Score (NPS) product that we have today in our portfolio. We're really, really excited about its prospects for '26.
Andrew Jeffrey, Analyst
Yes. It sounds that way. Just to be clear, Matt, will Instant Loans be transaction profit margin accretive in '26 or comparable to the rest of the company, I guess, the way to ask the question?
Matthew Newcomb, CFO
Yes. We do expect this to be a contributor to transaction profit dollars, particularly as we exit the year.
Andrew Jeffrey, Analyst
But perhaps lower margin with the opportunity for going forward?
Matthew Newcomb, CFO
Yes. Look, I think from a marketing perspective, it will look different than other parts of our liquidity products, but this is also, as Mark mentioned, something that will continue to improve over time as our portfolio matures, as the portfolio shifts to more repeat borrowers for longer duration. Again, very similar playbook that we saw with SpotMe and MyPay, where unit economics just get better and better over time.
Operator, Operator
We'll take our next question from Will Nance with Goldman Sachs.
William Nance, Analyst
I wanted to focus on the comments regarding the new variable pricing model for MyPay. It's impressive to see the margin profile improved and losses reduced to 1%. Can you share your expectations on how this new pricing model will affect both ARPU and transaction margins starting in the first quarter? Additionally, can you provide more details on the plan to expand access? In light of potentially higher revenue from increased pricing, is there an opportunity to accept higher losses in order to widen access? How do you envision that affecting the bottom line and overall margins? I’m interested in your thoughts on these different factors.
Christopher Britt, Co-Founder and CEO
Thanks, Will. Yes, just to tee this up a bit, I think we're really excited about the tailwind that we have with MyPay from a revenue perspective going into '26 here. We think it's one of many tailwinds that we have. We talked about Chime Card adoption, Instant Loans, but we are excited about some of these changes, both on the revenue side, but also in terms of opening up availability to more folks. Maybe I'll pass it over to Mark since he oversees that part of the business.
Mark Troughton, President
Thanks, Chris. Yes, as we mentioned in the prepared remarks, MyPay was a major success for us in '25, generating $400 million in revenue, with a transaction profit margin of nearly 60% by the end of Q4. This was achieved in the first year of its introduction as a lending product, which we are very pleased about. Initially, MyPay was launched with a fixed fee pricing model. It was free if you received your advance after 24 hours, and a $2 fixed fee for immediate advances. However, we quickly realized that this fixed fee was limiting our ability to scale the product and provide larger limits to more customers at a faster pace. We transitioned to a variable pricing model, which will enable us to utilize this as a growth platform and scale MyPay over time. This change began in Q4 of last year and was completed in January of this year. You may have already noticed an increase in MyPay yield in Q4 compared to Q3. More growth is anticipated in Q1 and beyond. That said, it's still early days. Regarding the recent pricing changes, we have not yet seen a full calendar month of results. This is aligning with our expectations, and we are excited about its impact. While we will not provide specific guidance on MyPay for 2026, it is included in our overall revenue and EBITDA guidance for the year. In response to the second part of your question, we believe there are opportunities to optimize MyPay beyond maintaining a 1% loss rate, improving it from both a net experience and transaction profit standpoint. This will become a strong growth platform for us moving forward, and we will continue to focus on offering the lowest cost product in the market.
William Nance, Analyst
That's great. Appreciate that color. And then just on the user growth, obviously, pretty strong this quarter, and I hear the commentary on your expectations for the full year. I'm just wondering if you could talk a little bit about the trajectory of Chime Enterprise over time with some of the partners, and it sounds like more to announce in the near future. How are you thinking about when Chime Enterprise could be a more meaningful contributor to the user growth? Is that something we could see as we progress through the year?
Mark Troughton, President
Sure. I'll continue with that one. In terms of an enterprise, we continue to be really excited, and there's a reason that it's one of our priorities for 2026 as Chris outlined upfront. We're seeing the value proposition resonating really well with employers. It's a broader suite rather than just wage access, totally free from very expensive offerings out there. Any employer that we speak to really has a solid installed base of prime members, which gives us a strong differentiator. You started to see that manifesting itself in this steady drumbeat of employers that we've been announcing, and we just announced another few partners earlier this week. It is a new go-to-market motion for us, and it does take longer than ramping up our consumer channel. But we have a solid pipeline. We expect to be making some more announcements here in the near future. We're not giving specific guidance related to adds from enterprise, but again, those are included in our overall guidance. One piece of data I can share is that we are seeing strong adoption, but we’re also seeing higher monetization and greater retention on our enterprise members than in our direct-to-consumer channel. This is something we continue to be excited about.
Operator, Operator
We'll take our next question from Jeff Cantwell with Seaport Research.
Jeffrey Cantwell, Analyst
I wanted to ask one on your LTV, the CAC. I want to ask if you can drill into that customer acquisition cost side of the equation. Can you maybe talk about what the trend is right now? Because you added 500,000 active members this quarter just really strong. So I'm curious whether you made any changes in terms of how you acquire customers? And then related to that, can you maybe unpack or help us understand what's driving that LTV to CAC, you're highlighting in the deck? Is that more of the impact of new spending on the new products and the penetration is driving LTV higher? Or how should we be thinking about LTV versus CAC?
Christopher Britt, Co-Founder and CEO
Yes, thanks for the question, Jeff. What I would say first on the new customer acquisition side is that we continue to see very consistent trends. Over 50% of new actives continue to come to Chime via organic and member-driven channels like referrals; that continues to be a star of our show. We've actually made some gains on the CAC side year-over-year. CAC for the full year in 2025 is actually down about 10% relative to the prior year. A lot of the early engagement initiatives that Chris mentioned earlier about making it easier to get started with Chime were big contributors to that. We're doing really well, I think, about the overall trajectory on CAC. Probably even more so, are we feeling good about the LTV gains that we're seeing. That I think is probably the primary driver here of the strong prints on overall LTV to CAC of north of 8x. A few of the contributors to that have been the overall step-up in transaction margin resulting from our ChimeCore migration. That's driven a step-up. An additional benefit has certainly been on MyPay's loss rate improvement. You've seen that build into our transaction margin as well. And then third, again, particularly among our new cohorts, Chime Card is resonating really well, where new cohorts are seeing close to 50% credit mix. Of course, credit earns nearly 2x the take rate compared to debit. So yes, I guess, in summary, we're mentioning strong progress on both sides, both CAC and LTV.
Jeffrey Cantwell, Analyst
I appreciate it. I want to ask you about ARPAM. As you're thinking about 2026, do you mind just telling us what is the right growth assumptions you have for ARPAM. It seems like you have, I'm hearing you, it has good product momentum right now across Instant Loans and MyPay and others. Maybe just talk about that and what you see as some more immediate drivers impacting ARPAM over the course of 2026?
Mark Troughton, President
Yes. I think, Jeff, a lot of the similar drivers that I've mentioned will flow through to 2026 as well from an ARPAM perspective. So Chime Card, I think, is probably a great one to start with, again, for 2x the take rate. This new MyPay pricing and monetization model that we have will also be a contributor to ARPAM growth we expect this year, and Instant Loans as well is a third contributor to ARPAM growth this year. So multiple exciting tailwinds of products that we've already launched and are really scaling. Beyond that, we're also very excited about the new product road map that Chris mentioned, again, across new membership tiers, investing products, joint accounts, and others.
Operator, Operator
We'll move next to Adam Frisch with Evercore ISI.
Adam Frisch, Analyst
Really nice update here and execution. I want to hit operating leverage for a sec. Obviously, a lot of the algorithm depends on growth on the top line, but are the cost levers still the same heading into the next few years? If you could talk about maybe the top few biggest levers is core at the top of the list? Or has a lot of that been realized? Where is that leverage going to come from? Then on MyPay, losses reached 100 basis points. Is there still room to improve further? Or is this the level that you want as the right balance between growth and loss?
Christopher Britt, Co-Founder and CEO
Yes, thanks for the question, Adam. The high-level answer here is, yes, we do continue to expect a continued trajectory of strong operating leverage. You've seen that across every part of our base, and you should expect to continue to see that across every part of our OpEx base this year. As you mentioned in the remarks, now that we have ChimeCore behind us, and of course, as a result of our ongoing AI initiatives. We can just do more. We can move faster. We can innovate more quickly, and be more nimble. That's allowing us to get more done without needing to grow our headcount. We are excited about continued operating leverage, again, across the business.
Mark Troughton, President
Yes, Adam, your hypothesis is correct. We will observe improvements in our loss rates as we continue lending to the same individuals because we need to become more efficient, and we are already seeing significant enhancements in our loss rates. We also benefit from having older, more experienced members with more loans, which naturally decreases loss rates for MyPay over time. We plan to reinvest some of those improvements in the growth of MyPay to enhance attachment and adoption rates, increase limits, and optimize overall transaction profit from MyPay. I believe you will see somewhat higher results in the future, but this increase will be more than offset by an increase in revenue.
Operator, Operator
We'll take our next question from Sanjay Sakhrani with KBW.
Sanjay Sakhrani, Analyst
I just want to follow up on some of the questions that were asked for. Maybe just one on the strong uptake on the new products and initiatives, including the fact that you have stronger tax refunds this year. I'm just curious, as we think about what's embedded in the assumptions that you guys have, how much of that have you sort of factored in?
Christopher Britt, Co-Founder and CEO
Yes, thanks for the question, Sanjay. We are, as I mentioned, expecting an outsized tax season this year as a result of the One Big Beautiful Bill Act. We haven't yet seen the peak of tax season. The timing of refunds are a bit later this year than we've seen in years past. But again, we do expect the magnitude to be higher. So far, we are seeing that they are higher. If you take a look at the average tax refund as of the end of last week, it was up double digits compared to the average tax refund at the same time last year. We have more to go, more data to see here in the next few weeks. But so far, that's what we're seeing. What we're seeing so far is embedded into our guidance.
Operator, Operator
We'll move next to Darrin Peller with Wolfe Research.
Darrin Peller, Analyst
Some of my questions were asked, but I want to hone in a little bit more on the products, the product velocity you guys have been putting out. Obviously, it was very strong with MyPay this year. When we think about the new products that will contribute in your view, the most in '26 incrementally above and beyond the pricing and the MyPay dynamic beyond that, what are you most excited about in the year ahead? I guess, related to that also on the Chime Enterprise or workplace, it sounds like it's going really well in terms of users, partners to add, and employers to add. But is that incorporated in the 1.4 million of new users? I would hope that would actually be somewhat additive versus last year where I think you did about 1.5 million. Just how should we think about that too?
Christopher Britt, Co-Founder and CEO
Thanks for the question. When we look out over the course of this year and what product initiatives we're most excited about having an impact in terms of revenue for the business, I think clearly, the continued adoption of Chime Card is going to be a major tailwind for the business. We're seeing it at the top of the funnel. We're also seeing more and more of our existing installed active debit card using member base take this card as well. I think when we launch this next new premium tier, we believe that it’s also going to continue to drive even more adoption of this core secured credit card and drive even more spend through that product category, which is going to be really helpful to the business.
Mark Troughton, President
In terms of the enterprise, I think as we indicated earlier, those we're not going to give specific guidance related to enterprise ads. Those are included in our overall guidance. But this is a new business. So we're obviously going to be conservative in terms of what we're putting forward with respect to enterprise.
Operator, Operator
At this time, we've reached our allotted time for questions. I'll now turn the call back over to Chris for any additional or closing remarks.
Christopher Britt, Co-Founder and CEO
Great. Thank you all for joining me today, and thanks to the Chime team for incredible execution. We look forward to spending more time with you all soon.
Operator, Operator
Thank you. This brings us to the end of today's meeting. We appreciate your time and participation. You may now disconnect.