Nubank sees 42% increase in net profit for the second quarter

Nubank’s Strong Performance and Future Growth

SÃO PAULO – NU Holdings, the parent company of Brazilian digital bank Nubank, saw a notable rise of 42% on a foreign exchange neutral basis on Thursday, with its shares climbing over 8% after the market closed.

With a client base nearing 123 million in Brazil, Nubank reported a net income of $637 million for the fourth quarter covering April to June. Their revenue reached $3.7 billion, reflecting a 40% increase from last year, and they’ve been expanding into markets like Colombia and Mexico.

Guiller Marrago, the Chief Financial Officer, mentioned that while profit growth would continue to be fueled by operational leverage and revenue increases, the underlying drivers are beginning to shift.

“For the past few years, most of our growth came from acquiring new customers. However, moving forward, we anticipate that a significant portion of Brazil’s revenue growth will stem from strengthening relationships with those existing customers,” Lago stated.

Nubank’s annual stock return ratio stands at a profitable 28%, aligning with reported figures.

Analysts at Citi described Nubank’s latest quarter as robust, noting that net profits are on the rise and have outperformed expectations.

The bank’s shares saw an increase of 8.3% in after-hours trading in New York.

Additionally, Nubank’s total loan portfolio grew by 8% since the first quarter, reaching $27.3 billion. This is largely attributed to a rise in personal loans, predominantly based on outstanding credit card debts.

The early default ratio decreased to 4.4%, down 0.3 percentage points from the first quarter, but the ratio of loans overdue by 90 days or longer slightly increased to 6.6%, reflecting a minor rise of 0.1 percentage points compared to the same timeframe, as Nubank indicated this is indicative of short-term delinquency trends and seasonal variations.

“We plan to continue our strong expansion of original unsecured loans throughout 2025 and 2026, as long as we monitor the quality of assets in our portfolio,” Lago mentioned during a conference call with analysts.