Nu Holdings Ltd. Reports First Quarter 2025 Financial Results

Nu Holdings Ltd. (NYSE:NU) ("Nu" or the "Company"), one of the largest digital financial services platforms in the world, released its First Quarter 2025 financial results today. Financial results are expressed in U.S. dollars and are presented in accordance with International Financial Reporting Standards (IFRS). The full earnings release has been made available on the Company's Investor Relations website at www.investors.nu, as well as the details of the Earnings Conference Call Nu will hold today at 6:00 pm Eastern time/7:00 pm Brasilia time.

"Starting 2025 strong, Nubank reached 118.6 million customers, adding over 4 million in a single quarter, showcasing its powerful platform scalability across Brazil, Mexico, and Colombia. This growth is driven by deepening customer engagement: 98.7 million monthly active users and an activity rate exceeding 83%. Revenues surged 40% year-over-year (FXN) to $3.2 billion, driven by a 62% expansion in the interest-earning portfolio. In Brazil, nearly 30% of adults consider Nu their primary bank, confirming significant market share gains and value delivery. With disciplined boldness, we're capitalizing on vast growth opportunities by responsibly expanding, strategically reinvesting, and scaling our proven flywheel model. We are confident that by continuously enhancing our offerings and market position, Nubank will capitalize on the long runway of growth ahead of us and deliver enduring value to both customers and shareholders," says David Vélez, founder and CEO of Nubank.

Q1'25 Results Snapshot

Below are the Q1'25 performance highlights of Nu Holdings Ltd.:

Operating Highlights:

• Customer growth: Nu added 4.3 million customers in Q1'25, driving a 19% year-over-year (YoY) increase of 19.3 million, reaching a total of 118.6 million customers globally by March 31, 2025. Of that total, 104.6 million are in Brazil, 11 million in Mexico, and Colombia nearly reached 3 million customers, maintaining its positive momentum following the launch of the Nu Cuenta product. This expansion reinforces Nu's position as one of the world's largest and fastest-growing digital financial services platforms. In Brazil, Nu is the third-largest financial institution by number of customers, according to the Brazilian Central Bank.
• Engagement and activity rates: Monthly Average Revenue per Active Customer (ARPAC) grew 5% sequentially and 17% YoY on an FX-neutral basis¹ (FXN) to $11.2 in Q1'25, with mature cohorts reaching almost $26, underscoring the strong long-term monetization potential of our model. Monthly activity rate² is at 83.2%.
• Low-cost operating platform: Monthly Average Cost to Serve Per Active Customer remained below the dollar level, at $0.7 per customer, a 4%YoY reduction and a decline of 12% QoQ on FXN, driven by disciplined execution and seasonally lower transaction volumes, particularly in credit cards. The company's efficiency ratio improved to 24.7%, a sequential improvement of 520 basis points (bps) sequentially and more than 740 bps YoY. This quarter's ratio includes a one-off impact of $47 million related to the remeasurement of a specific item within our deferred tax assets. Excluding this effect, the efficiency ratio would have been 26.7%, still a 320 basis-point improvement QoQ.
• Asset Quality³: Nu's leading indicator of asset quality, the 15-90 NPL ratio, rose 60 bps to 4.7%, in line with expectations and slightly below the historical seasonal increase of 70bps. This reflects the continued strength of our underwriting and disciplined risk management. 90+ NPL decreased by 50 bps to 6.5%, outperforming historical trends. This improvement is consistent with the lower early-stage delinquency levels observed in prior quarters, as 90+ NPLs lag 15-90 by 1 to 3 quarters.

Financial Highlights:

• Net & Adjusted Income: Net Income increased 74% YoY FXN to $557.2 million, compared to $378.8 million in Q1'24, and annualized ROE was 27%, while Adjusted Net Income⁴ increased to $606.5 million, from $442.7 million in Q1'24. Nu is achieving these strong levels of profitability and efficiency, despite holding over $4.3 billion in excess capital across our geographies and at the holding company, placing Nu among the most profitable financial services companies globally.
• Revenue: Nu's Q1'25 revenues increased 40% YoY FXN, to another record of $3.2 billion. This sustained growth underscores the scalability of our platform and the strength of our unit economics.
• Gross Profit: Nu's gross profit totaled $1.3 billion in Q1'25, down 3% FXN sequentially, and up 32% YoY on FXN. This sequential decline, and the corresponding reduction in gross profit margin to 40.6%, was primarily driven by higher credit loss allowances and increased interest expenses in Brazil, reflecting the rise in the SELIC rate, which we haven't yet fully repriced across the portfolio. Additionally, the expansion of our deposit base in Mexico, while strategically important, added further pressure on gross profit margins in the short term.
• Liquidity: Deposits increased 48% YoY FXN to $31.6 billion, while the cost of funding was 90% of the blended interbank rates for the quarter. Total receivables across Nu's credit card and loan portfolios expanded 40% YoY FXN and 8% quarter-over-quarter (QoQ) FXN to $24.1 billion, while its total Interest-Earning Portfolio (IEP) increased 62% YoY FXN to $13.8 billion on March 31, 2025.
• Net interest income: Increased 34% YoY and 5% QoQ on FXN, reaching a new all-time high of $1.8 billion. The net interest margin (NIM) declined 20 bps sequentially to 17.5% as expected and driven by deliberate strategic choices to optimize for long-term growth. Nu Holdings' risk-adjusted NIM declined to 8.2%. This compression mirrors the temporary pressure we also saw in nominal NIM, reflecting our conscious decisions on deposit pricing in new geographies and the strategic pace of asset growth.

Business highlights

• Performance and Growth in Brazil: In Brazil, the customer base reached 104.6 million by March 31, 2025, serving nearly 59% of Brazil's adult population, with 85% of them actively using our platform, and among those, close to 60% use Nu as their primary bank.
• Ramp up unsecured loans in Brazil: Over the past few quarters, we've significantly ramped up originations in unsecured loans, reaching a record R$17.3 billion in Q1'25, all while maintaining NPL formation levels stable and under control. This performance reflects the strength of our credit models, the consistent discipline of our execution, and our ability to scale with quality, without compromising resilience. And with the unit economics of this product often delivering ROEs above triple digits, it's also one of the most attractive growth opportunities in our portfolio.
• Mexico: Reached 11 million customers in Mexico, up 67% YoY. Deposits grew 18% FXN QoQ to $5.4 billion. In April, Nu Mexico achieved a historic milestone obtaining regulatory approval for its banking license. It unlocks new product capabilities, strengthens our ability to scale deposits, and reinforces our long-term mission to drive financial inclusion.
• Colombia: Colombia nearly reached 3 million customers, and deposits increased 30% FXN QoQ to $1.8 billion in Q1'25.

Footnotes

¹ FX neutral measures were calculated to present what such measures in preceding periods/years would have been had exchange rates remained stable from these preceding periods/years until the date of the Company's more recent financial information.

² Activity rate is defined as monthly active customers divided by the total number of customers as of a specific date.

³ Brazil Only

⁴ Adjusted Net Income is a non-IFRS measure calculated using Net Income adjusted for expenses related to Nu's share-based compensation as well as the hedge accounting and tax effects related to these items, among others. For more information, please see "Non-IFRS Financial Measures and Reconciliations – Adjusted Net Income Reconciliation".

Note on forward-looking statements and non-IFRS financial measures

This release speaks at the date hereof and the Company is under no obligation to update or keep current the information contained in this presentation. Any information expressed herein is subject to change without notice. Any market or other third-party data included in this presentation has been obtained by the Company from third-party sources. While the Company has compiled and extracted the market data, it can provide no assurances of the accuracy and completeness of such information and takes no responsibility for such data.

This release contains forward-looking statements. All statements other than statements of historical fact contained in this presentation may be forward-looking statements and include, but are not limited to, statements regarding the Company's intent, belief or current expectations. These forward-looking statements are subject to risks and uncertainties, and may include, among others, financial forecasts and estimates based on assumptions or statements regarding plans, objectives and expectations. Although the Company believes that these estimates and forward-looking statements are based upon reasonable assumptions, they are subject to several risks and uncertainties and are made in light of information currently available, and actual results may differ materially from those expressed or implied in the forward-looking statements due to various factors, including those risks and uncertainties included under the captions "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in the prospectus dated December 8, 2021 filed with the Securities and Exchange Commission pursuant to Rule 424(b) under the Securities Act of 1933, as amended, and in the Annual Report on Form 20-F for the year ended December 31, 2024, which was filed with the Securities and Exchange Commission on April 16, 2025. The Company, its advisers and each of their respective directors, officers and employees disclaim any obligation to update the Company's view of such risks and uncertainties or to publicly announce the result of any revision to the forward-looking statements made herein, except where it would be required to do so under applicable law. The forward-looking statements can be identified, in certain cases, through the use of words such as "believe," "may," "might," "can," "could," "is designed to," "will," "aim," "estimate," "continue," "anticipate," "intend," "expect," "forecast", "plan", "predict", "potential", "aspiration," "should," "purpose," "belief," and similar, or variations of, or the negative of such words and expressions.

The financial information in this document includes forecasts, projections and other predictive statements that represent the Company's assumptions and expectations in light of currently available information. These forecasts, projections and other predictive statements are based on the Company's expectations and are subject to variables and uncertainties. The Company's actual performance results may differ. Consequently, no guarantee is presented or implied as to the accuracy of specific forecasts, projections or predictive statements contained herein, and undue reliance should not be placed on the forward-looking statements in this presentation, which are inherently uncertain.

In addition to IFRS financials, this presentation includes certain summarized, non-audited or non-IFRS financial information. These summarized, non-audited or non-IFRS financial measures are in addition to, and not a substitute for or superior to, measures of financial performance prepared in accordance with IFRS. References in this presentation to "R$" refer to the Brazilian Real, the official currency of Brazil.

About Nu

Nu is one of the largest digital financial services platforms in the world, serving more than 118 million customers across Brazil, Mexico, and Colombia. The company has been leading an industry transformation by leveraging data and proprietary technology to develop innovative products and services. Guided by its mission to fight complexity and empower people, Nu caters to customers' complete financial journey, promoting financial access and advancement with responsible lending and transparency. The company is powered by an efficient and scalable business model that combines low cost to serve with growing returns. Nu's impact has been recognized in multiple awards, including Time 100 Companies, Fast Company's Most Innovative Companies, and Forbes World's Best Banks.

For more information, please visit https://international.nubank.com.br/about/.

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