CHYM, Chime Financial Inc.

Will it survive?

• Can it pay its interest? —
  No meaningful interest burden
  Little or no interest expense reported
  What this means

  Little or no interest expense reported, the business isn't leaning on lenders to operate.

• How heavy is the debt, net of cash? +$466M
  Net cash, debt-free
  Cash $466M − debt $0
  What this means

  Cash and short-term investments exceed every dollar of debt by $466M, on net the company owes nothing, and can act from strength when others can't. Net debt is the leverage figure that matters: the cash is already set against the debt. Strategic or illiquid investments aren't counted here.

• How long is cash tied up? -11d
  Negative, funded by others
  DSO 43 + DIO 0 − DPO 54 days
  What this means

  Days cash is tied up between paying suppliers and collecting from customers. A negative cycle is a quiet moat: suppliers and customers fund the operation (Buffett's “float”), the company grows on other people's money. (Little or no inventory, a services / asset-light model, so the inventory leg is ~0.)

Is it a good business?

• Return on invested capital —
  Not enough data
  Industry peers: median 25%
  What this means

  The filing data didn't include the inputs for this check.

• Owner-earnings margin 2%
  Thin through the cycle
  3-yr median margin, range -13%–4%; latest $33M = operating cash $53M − maintenance capex $20M
  Industry peers: median 15%
  What this means

  What an owner could take out without starving the business: operating cash less the maintenance capital it must spend to hold its position — Buffett's owner earnings. That's 2% of revenue this year, a 2% median across 3 years. Treating stock comp as the real expense it is (less $1.1B of SBC) leaves ($1.0B).

• Are earnings backed by cash? $53M
  Loss, but cash-generative
  Net income ($1.0B) · cash from operations $53M
  What this means

  The company reported a net loss, so a conversion ratio isn't meaningful. What matters then is whether operations still threw off cash, here, they did.

How is the cash used?

• Where do the earnings go? 236%
  Returned more than it generated
  Dividends + buybacks $78M ÷ Owner Earnings $33M — this fiscal year
  What this means

  The company returned more than it generated: against $33M of Owner Earnings, $78M (236%) went back to shareholders, $0 dividends, $78M buybacks — the excess came from the balance sheet or borrowing, not the year's operations. But the buybacks barely exceed stock issued to employees ($1.1B SBC), net of dilution, little was truly returned. Sustained, that pattern draws down cash or adds debt; the net-debt line above shows where it stands.

• Investing or harvesting? 0.66×
  Harvesting
  Capex $20M ÷ depreciation & amortization as filed $30M
  What this means

  Descriptive, not a grade. Above ~1× means investing faster than assets wear out (growth, or, sustained for years, today's earnings carrying less depreciation than tomorrow's will). Below means spending less than it's wearing out (efficiency, or a melting asset base). The ratio won't tell you which; the filings will.

The promise and the pay packet

• What does winning a customer cost? 29%
  Modest selling cost
  Selling and marketing $635M ÷ revenue $2.2B
  What this means

  Sales and marketing as a share of revenue, kept apart from administrative overhead because it answers a different question: how much a business must spend to win the next customer. A company whose product pulls customers in spends little here and keeps the difference; one that must buy its growth is running to stand still, and the spending has to keep rising for revenue to keep rising. Read it beside the growth rate, not alone.

• Is the buyback buying ownership, or mopping up? 49.0%
  Stock pay, share count unread
  Stock compensation $1.1B (fiscal 2025), 49.0% of revenue · repurchases $78M · the share count is not comparable across these years (a split or a first listing sits in the record), so the drift is withheld
  What this means

  Stock handed to employees is a real cost paid in the owner's own currency: it is charged against profit, but the shares it creates are permanent. Many companies repurchase stock at the same time, which looks like a return of capital and often is not — if the count barely moves, the cash merely cancelled the pay packet and bought the owner nothing. The three states worth telling apart are a count genuinely shrinking, a count standing still despite large repurchases, and a count rising because the issuance was never offset at all.

Graham’s defensive tests · 2 of 2 met

Graham’s numerical criteria for the defensive investor (The Intelligent Investor, ch. 14), run on the filings. A floor of safety, not a buy signal; many fine modern businesses fail his strictest liquidity rules by design.

• Adequate size Pass
  Revenue ≥ $2B · $2.2B
  What this means

  Big enough to weather a storm. Graham's 1972 floor was ~$100M of sales (≈ $700M today); we use a $2B revenue line as a conservative modern stand-in.

• Strong liquidity Pass
  Current ratio ≥ 2× · 4.53×
  What this means

  Current assets at least twice current liabilities, near-term bills covered without touching the business. Strict by design: many cash-rich modern firms run leaner and miss it, holding their cushion in longer-dated securities.

• Moderate price —
  P/E ≤ 15 and P/E × P/B ≤ 22.5 · decided by the price
  What this means

  Graham's valuation gate, the wall he kept between a sound business and a sound investment. Three-year average earnings are $-1.08/share (latest year $-2.65), the averaged base the calculator's gate runs on, and book value is $3.68/share. Enter a price in “What the price implies” just below for the P/E, P/B, and whether it clears. But this is the rule Buffett outgrew: there's no hard P/E law, and a wonderful business can deserve a far richer multiple if the thesis holds, treat it as the bargain-hunter's floor, not a verdict on the price.