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Business News/ News / Nubank Posts Record Revenue, Profit Beats Expectations
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Nubank Posts Record Revenue, Profit Beats Expectations

Nu Holdings Ltd., the parent of Brazil-based digital bank Nubank, reported record revenue in the first quarter while acknowledging that its growth is coming with a higher delinquency rate.

Nubank Posts Record Revenue, Profit Beats ExpectationsPremium
Nubank Posts Record Revenue, Profit Beats Expectations

(Bloomberg) -- Nu Holdings Ltd., the parent of Brazil-based digital bank Nubank, reported record revenue in the first quarter while acknowledging that its growth is coming with a higher delinquency rate.

Nubank, one of the world’s largest digital banks, had revenue of $2.7 billion in the three-month period through March, it said in a statement Tuesday. 

The firm reported $378.8 million in net income compared with an average estimate of $357.3 million in a Bloomberg survey of analysts. Earnings per share came in just short of estimates.

Non-performing loan rates rose in the quarter to 5% from 4.4% in the year-earlier period for loans of 15 to 90 days and to 6.3% from 5.5% for loans of more than 90 days. 

Shares, which were up more than 38% year-to-date, traded 1.3% higher post-market.

Launched in Brazil in 2013, the company has quickly grown to one of the largest financial institutions in the country with about 92 million clients as it has expanded its offering from credit cards to an investment platform, insurance policies and more.

It’s now trying to replicate that same success in Mexico, Latin America’s second-biggest economy, and in Colombia.

“We printed a 23% return-on-equity for Nu Holdings, among best-in-class financial institutions in Latin America, even though our holding company continues to be over-capitalized and our operations in Mexico and Colombia are still in the early phases of getting to profitability," founder and Chief Executive Officer David Velez said in the statement.

Nubank added 5.5 million customers in the quarter. Since the quarter ended, Nubank crossed the key metric of 100 million customers across its three geographies of Brazil, Mexico and Colombia, the company said earlier this month. 

Mexico represents a huge opportunity for fintechs looking to tap into the population of 130 million people where cash remains king and many people lack access to traditional banking channels.

--With assistance from Leda Alvim.

More stories like this are available on bloomberg.com

©2024 Bloomberg L.P.

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Published: 15 May 2024, 03:05 AM IST
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