Here's How Dave's ARPU Gains 36% Y/Y While Managing Steady CAC

Dave Inc. DAVE displayed the durability of its growth algorithm, as evidenced by a 36% year-over-year hike in Average Revenue Per User (ARPU) in 2025. It is really striking how the company managed to maintain a steady increment in its customer acquisition costs (CAC) over the past few quarters. In the fourth quarter of 2025, Dave’s CAC was at $20, which witnessed a marginal hike from the preceding quarter’s $19.

This lofty growth in ARPU was a combined effect of underwriting enhancements via CashAI v5.5, disciplined pricing and solid product engagement. The improved CashAI v5.5 aided Dave in registering a 20% year-over-year increment in its average ExtraCash origination size in the fourth quarter of 2025.

While such hefty growth could have been incurred at the expense of heightened credit risks, the AI underwriting model was successful at recording 1.89% in the 28-day past due rate, a 12% improvement from the year-ago quarter’s actual. It allowed the company to ensure higher transactions were made with lower losses.

Dave was successful at improving ARPU by boosting Dave Debit Card adoption, with spend climbing 17% year over year to $534 million in the fourth quarter of 2025. Dave’s payback periods improved from a month to under four months despite higher marketing investment.

Dave highlights the company’s focus on customer acquisition expenditure toward customers who can generate the highest gross profit. The decoupling of CAC from top-line growth implies a better competitive moat, backed by solid unit economics than rapid marketing spends.

DAVE’s Price Performance, Valuation & Estimates

Dave has skyrocketed 179.9% in the past year, significantly outperforming the 37.8% rally of its industry. The stock has outperformed its industry peer, First Advantage Corporation’s FA 14.1% dip and Futu Holdings’ FUTU 104.6% surge during the same timeframe.

1-Year Share Price Performance

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From a valuation standpoint, DAVE trades at a 12-month forward price-to-earnings ratio of 14.75, higher than First Advantage’s 9.28 and Futu Holdings’ 13.16.

P/E - F12M

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Dave has a Value Score of C, while First Advantage and Futu Holdings carry a Value Score of B and F, respectively.

The Zacks Consensus Estimate for Dave’s 2026 and 2027 earnings has risen 3.7% and 3.5%, respectively, over the past 60 days.

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DAVE currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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