Heat a large Dutch oven over medium heat. Add the chopped bacon and cook for 6-8 minutes until crispy. Use a slotted spoon to transfer the crispy bacon to a paper towel-lined plate, leaving about 2 tablespoons of rendered bacon drippings in the pot.

Add the diced onion to the warm bacon drippings and sauté for 4 minutes until translucent. Stir in the minced garlic and dried thyme, cooking for 1 minute until fragrant.

Sprinkle the flour over the onions and stir constantly for 1 minute to cook off the raw flour taste.

Slowly pour in the chicken broth while whisking to prevent lumps. Add the frozen diced hashbrowns and black pepper. Bring to a boil, then reduce heat to medium-low, cover, and simmer for 12-15 minutes until the potatoes are fork-tender.

Use a potato masher to mash about one-third of the potatoes right in the pot to naturally thicken the soup while keeping plenty of tender chunks.

Reduce heat to low. Stir in the cubed cream cheese, 1 1/2 cups of shredded sharp cheddar, and half of the cooked bacon until melted and velvety smooth.

Ladle into warm bowls and top with a swirl of sour cream, the remaining cheddar cheese, crispy bacon bits, and fresh green chives.