Which Fintech Disruptor Offers More Growth Potential Now?
6 Mins Read
Both SoFi Technologies SOFI and Dave Inc. DAVE are innovative fintech companies offering digital banking services and financial products via mobile-first platforms. They operate as neobanks, providing lending and banking services to underserved or digitally savvy audiences.
SOFI is a well-established digital financial services company. Dave, on the other hand, is a newer, leaner player focused on short-term, interest-free cash advances and budgeting tools.
SOFI isn’t playing defense in the crowded fintech arena; it’s going full throttle on scale and innovation to fuel profitability and dominate the next phase of financial services. The company’s second-quarter 2025 results underscore a company firing on multiple cylinders, scaling membership, diversifying revenues, expanding margins and enhancing profitability. Its raised guidance for the full year signals confidence in the business model and the strategic investments underpinning future growth.
Second-quarter adjusted earnings came in at 8 cents per share, beating the Zacks Consensus Estimate by 33.3% and more than doubling from the same period a year earlier. Revenues reached $858.2 million, surpassing estimates by 6.6% and growing 43.4% year over year. Management emphasized that this surge was powered by both a swelling customer base and an expanding product portfolio.
The company added a record 850,000 new members during the quarter, taking total membership to 11.7 million, a 34% annual increase. Product adoption was equally strong, with 1.3 million new products added, representing 34% year-over-year growth to over 17 million products in total. Notably, 35% of new products were opened by existing members, underscoring effective cross-selling strategies.
The diversification of revenue streams continues to take shape. Total fee-based revenue reached $378 million, up 72% year over year, driven by origination fees, referral fees, interchange revenues and brokerage fees. Annualized, SoFi now generates more than $1.5 billion in fee-based income, reducing reliance on interest-based earnings and aligning with a capital-light growth model.
Second quarter adjusted EBITDA climbed 80.6% year over year to $249.1 million, representing a 29% margin, an improvement of 600 basis points. The incremental EBITDA margin stood at 43%, highlighting operating leverage despite the company’s continued investment in long-term expansion. Net income for the quarter was $97 million, translating to an 11% net margin.
Given the strong first half, SoFi has raised its 2025 guidance. The company now expects adjusted net revenues of approximately $3.375 billion, $65 million above the prior top-end forecast and implying about 30% annual growth. Adjusted EBITDA is projected at $960 million, above the earlier $875-$895 million range, with a margin of 28%.
EPS is now anticipated to be 31 cents, surpassing both prior guidance of 27-28 cents and the current consensus mark of 28 cents. GAAP net income guidance has been increased to $370 million from the previous $320-$330 million range.
In operational terms, SoFi expects to add at least 3 million new members in 2025, representing roughly 30% year-over-year growth, and increase tangible book value by about $640 million. Management’s confidence in its growth prospects is underpinned by product innovation, brand strengthening, and the expansion of both fee-based revenues and its technology platform.
Dave’s expanding membership base has been a major contributor to its strong financial performance in the second quarter of 2025. Monthly Transacting Members reached 2.6 million, reflecting a 16% increase from the prior-year quarter. This growth represents the addition of 722,000 new members, achieved at an average acquisition cost of $19 per customer.
Customer activity has also been robust, highlighted by a 51% surge in ExtraCash originations and a 27% increase in Dave Debit Card usage during the quarter. Together with its refined monetization strategy, this consistent membership growth translated into a 64% year-over-year rise in revenues and a remarkable 236% jump in adjusted EBITDA, strengthening confidence in the company’s growth trajectory.
However, external economic pressures remain a challenge. The recent shift in international tariffs pushed consumer prices up by 2.7% in July compared to last year. Rising inflation reduces disposable income, especially for individuals living paycheck to paycheck, and raises the probability of higher consumer borrowing. This, in turn, elevates delinquency risks. In Q2 2025, Dave’s 28-day delinquency rate came in at 2.4%, up from 2% a year earlier, an increase that, while modest, is concerning.
Competition further complicates the landscape. Fintech peers like OppFi and Upstart Holdings provide comparable services, while traditional banks are intensifying the rivalry with small-dollar loans and overdraft protection offerings. Since Dave’s core appeal lies in helping customers avoid bank fees, these moves from banks add significant pressure.
To maintain its edge, Dave will need to continue investing aggressively. But balancing these investments with the pursuit of profitability will remain a difficult act—one that could test the company’s ability to sustain its current pace of expansion.
The Zacks Consensus Estimate for Dave’s 2025 sales is set at $512.4 million, indicating a 47.6% year-over-year increase. The consensus estimate for EPS is $9.72, indicating an 85.5% rise compared to the previous year. In the past 60 days, one estimate for 2025 has moved upward, with no downward revisions.
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The Zacks Consensus Estimate for SOFI’s 2025 sales is $3.4 billion, indicating more than 30% year-over-year growth. The consensus estimate for EPS stands at 31 cents, indicating more than 100% increase from last year. In the past 60 days, six estimates for 2025 have moved upward, with no downward revisions.
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SOFI is currently trading at a forward 12-month P/E ratio of 53.56X, higher than the 12-month median of 45.11X. DAVE is trading at 18.05X, significantly lower than the 12-month median of 31.45X.
When comparing Dave and SoFi, both show impressive growth, but SoFi emerges as the stronger long-term winner. While Dave’s lean model and surging ExtraCash adoption highlight rapid expansion, its smaller scale, rising delinquency rates, and competitive threats pose challenges. SoFi, on the other hand, demonstrates balanced, diversified growth with scaling membership, expanding product adoption and accelerating profitability. Its raised 2025 guidance, robust fee-based revenues, and strong EPS momentum reinforce its leadership in digital finance. Despite a richer valuation, SoFi’s scale, brand strength, and proven execution give it more durable growth potential.
SOFI currently carries a Zacks Rank #2 (Buy), while DAVE carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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