Chime Finally Turns Profitable—But Risks Remain

Summary

Chime Financial NASDAQ: CHYM is now something many digital banks never become. It is profitable. On the surface, that’s a big deal. The company showed in the first quarter strong revenue growth, expanding margins, and aggressive buybacks. Chime is a fintech startup that can earn money rather than just burn it. Now, Chime needs to show whether the profit is durable enough to justify investing.Get Chime Financial alerts:Sign Up Profits Finally Reach the Bottom LineChime’s story is no longer about potential but execution. Chime Financial Today$18.01 +0.62 (+3.58%) As of 11:00 AM Eastern This is a fair market value price provided by Massive. Learn more.52-Week Range$16.17▼$44.94Price Target$31.65 The company reported genuine income in the first quarter—its first profitable quarter since going public. The app-based neobank reported $53 million in GAAP net income for the year’s first three months on revenue of $647 million, up 25% from a year earlier. On a per-share basis, the company reported 13 cents, well above the 3 cents expected. And while earnings per share are expected to be strong this year, models for 2027 predict a real jump to as high as 84 cents. These results and the positive outlook are a welcome turnaround. As recently as the fourth quarter of 2025, the company still posted a net loss of $45 million on revenue of $596 million. The business was already attractive, but spending got in the way. In fact, the company’s gross margin was already an impressive 89%, and the transaction margin, meaning how much money Chime kept after paying for its core banking services, sat at 72%. The problem was that marketing spending, technology investment, and overhead were eating the profits before they could reach the bottom line. The fix came mostly with technology. While marketing and tech spending stayed relatively level, the company moved much of its processing in-house and pushed hard into artificial intelligence for software development and customer support. General an...