Chime’s IPO Was a Middle Finger to Jamie Dimon… But I’m Gonna Rain on Their Parade

You’d think that between Trump’s obsession with tariffs and Jerome Powell locking interest rates in a panic room with a “Do Not Disturb Until Recession” sign on the door, the IPO market would be anemic whispering sweet nothings to Cathie Wood and reminiscing about the glory days of 2021 SPAC mania. Nope. Instead, we’ve got fintechs doing their best Hot Girl Summer impression. The latest to walk down Wall Street’s runway in heels and an SEC filing is Chime (aka the online bank for people who hate banks). And let’s just say… she popped off in a “you go girl” kind of way.

Yesterday, Chime made its public debut on the Nasdaq and instantly reminded investors what a good old fashioned IPO pop feels like. Priced at $27, already above its expected range, Chime stock jumped 37% to close at $37.11, hitting a peak of $44.94 at one point. It raised about $700 million in fresh cash, with early investors cashing out another $165 million. All in all, Chime walked away with a market cap of $13.5 billion, or $16 billion depending on which share count you believe. Yes, that’s a comedown from its $25 billion venture-backed peak in 2021, but so is your crypto portfolio… let’s not throw stones.

Think of Chime like if Venmo and your broke friend from college had a baby and raised it to never charge overdraft fees. Founded in 2012, Chime grew by giving Americans earning under $100k a modern, no-BS banking alternative. The company makes money the old-fashioned fintech way: interchange fees. When you swipe your Chime card, a tiny percentage goes to Chime. That’s it. 72% of their revenue is just royalties (Mr. Wonderful’s probably having a wet dream about the IPO as we speak). As analyst Dan Dolev put it: “I’m surprised by how unsophisticated that business model is.” Same, Dan. But it’s working.

Revenue last quarter hit $518.7 million, up 32% YoY. Net income came in at $12.9 million (down a bit), but adjusted profitability was $25 million. And get this… 8.6 million monthly active users, with most customers using Chime as their primary bank. (And before you call that “cute,” they’re now the 6th largest debit card issuer in the U.S. by purchase volume. Sit down, Wells Fargo.)

Oh, and get this… Between 2022 and 2024, Chime lost $1.4 billion in the name of “marketing.” Think the usual: Super Bowl ads, influencer campaigns, and probably a few too many subway posters. Retention, though, was above 90% once people set up direct deposit. Meaning if they hook you, you’re likely staying. Not to rain on their parade or anything, but there’s still a big problem: fraud and transaction losses are creeping up, jumping from 9% to 21% of revenue YoY. That’s… a lot.

CEO Chris Britt says they’re focused on innovation, maybe even launching an unsecured credit card eventually (in other words: more revenue, more risk). He’s also playing the anti-Jamie Dimon card, claiming big banks literally lose money on the working class. “75% of Americans earn under $100k,” Britt says. “We serve them profitably. Banks don’t.” (Translation: we’re the Costco of banking, and JPMorgan is charging $7.50 for a bottled water.

Chime isn’t alone. Circle and eToro have also recently gone public and performed well. So clearly modern finance and crypto is a theme here. This IPO was a litmus test for the whole fintech sector. And based on yesterday’s reaction? Fintech is the place to be.

If things keep trending this way, Klarna, Gemini, and the rest of the fintech bench might just start warming up for their own Wall Street walk of fame. Chime just proved that the IPO market can thrive even in a world of 5.5% interest rates and trade war reruns. If the company keeps its fraud problem under control and keeps swiping its way to growth, this stock could have some long legs.

At the time of publishing this article, Stocks.News doesn’t hold positions in companies mentioned in the article.