Nu reached 100 million customers this month and has just released yet another quarter of strong financial results. Revenues grew to $2.7 billion in Q1’24, with ARPAC reaching $11.4. Cost to serve remained stable and below the dollar level, contributing to a record net income of $379 million and ROE of 23%. 

Also in this issue: S&P upgrades Nu Financeira S.A.’s global and local ratings; Forbes ranks Nu #1 in its list of World’s Best Banks, both in Brazil and Mexico; and more.

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Nu posted another quarter of record-breaking financial results, with revenue growth to $2.7 billion and net income to $379 million. After the end of the quarter, the company reached 100 million customers, becoming the first digital banking platform to reach this milestone outside of Asia, and kept the cost to serve stable and below the dollar level while increasing ARPAC to $11.4. 

Nu Holdings printed a 23% return-on-equity, among best-in-class financial institutions in Latin America, even though it continues to be over-capitalized and with the operations in Mexico and Colombia still in the early phases of getting to profitability. The operations of these new markets are showing more accelerated results in number of customers, deposits, revenue, and market share of credit card purchase volume than Brazil in a comparable time frame.

Q1’24 Results Highlights:
Financial

• Global revenues: $2.7 billion
• Net Income: $379 million
• Annualized ROE: 23%
• Interest-earning portfolio: $9.7 billion (86% growth YoY FXN)
• Total deposits: $24.3 billion
  • Loan-to-deposit ratio: 40%

Operational and business

• Customers – 99.3 million (surpassing 100 million in May, after the end of the quarter
  • 5.5 million added in the quarter 
• ARPAC: $11.4
• Cost to Serve per Active Customer: $0.9 
• Activity rate: 83.2% 
• Consumer finance asset quality in Brazil – 5.0% for 15-90 NPL ratio (broadly in line with expectations) | 6.3% for 90+NPL

Corporate information

Celebration. Founder and CEO David Vélez reflected on the "once-unattainable" 100 million customers target and how Nu’s customer-centricity will continue to take us further in an event at the São Paulo headquarters. Nu’s management team welcomed around 80 journalists, content creators, and customers from Brazil, Mexico, and Colombia for four days of content on the company’s journey and long-term plans. Customers shared the impact Nu had in their lives in a mini-documentary that premiered at the event.

In case you missed it. David deep-dived into how customer-centricity is key in achieving Nu’s long-term goals in the latest episode of the Nu Videocast.

S&P upgrade. S&P Global Ratings upgraded Nu Financeira S.A. to ‘BB’ on the global scale and to investment grade ‘brAAA’ on the national scale, at the cap of Brazilian Sovereign rating. This is the agency’s second upgrade assigned to Nu Financeira in less than one year. Additionally, Moody's improved the Outlook of Nu Financeira to Positive from Stable, and its global Ba2 rating was affirmed, as well as Nu Holdings' Ba3.

Awards and recognitions. For the sixth year in a row, Nu stands among Forbes’ World’s Best Banks. This time, the publication surveyed over 49.000 people and placed us at #1 in both Brazil and Mexico. In the past month, we have also been listed in other rankings as the strongest brand and among the most valuable and influential brands in the country.

Impact beyond inclusion. Nubank and Mastercard released a study that illustrates the path to financial health for millions of Brazilians. The research highlights that, after gaining access to credit, 60% of Nu’s customers moved from financial access to actual usage of financial products in 24 months and 40% within 12 months, regardless of income level.

Benefits package. Nubank+ is our new benefits package, with cashback on credit card purchases and free withdrawals. It also includes a partnership with Max, providing access to their streaming platform at no extra cost for the first year. As part of the partnership, Nu is bringing the “Game of Thrones & House of the Dragon Experience” to Brazil.

Payroll loan portability. Customers can now transfer their SIAPE and INSS payroll loans from other financial institutions to Nu. Our transparent, fully digital tool enables easy loan transfers at lower rates, starting at 1.40% per month.

Secured limit increase. Nubank now offers Nu Limite Garantido to business customers, allowing them to increase their credit card limit using investments as collateral. With this feature, entrepreneurs can leverage funds in Money Boxes to boost their credit limit, providing flexibility and financial planning tools.

Cajitas Mexico. Nu Mexico launched a new option to encourage long-term savings, allowing customers to "freeze" funds in Cajitas (Money Boxes) to earn fixed annual interest rates as high as 15%. 

Nu is on its path to becoming one of the largest consumer platforms in Latin America, said David Vélez during the media event in São Paulo. Executives spoke about the secret behind our success, and the fundamental role of having a customer-centric culture. The 100 million customers represent only 1.25% of the world’s population, and financial services are the biggest profit pool in the world, reinforcing the wide avenue of possibilities ahead.

Our digital business model allows us to deliver better products at lower costs for the company and consumers, bringing in even more customers and further engaging existing ones. David explained our growth flywheel in an interview with CNBC and detailed how it’s scalable.

Mexico is Nu’s top priority for 2024, and our metrics in the country are beating those from Brazil when comparing the same period. Nu surpassed 7 million customers there and has just announced a new investment option with higher yields. In Colombia, we continue to grow at an accelerated pace, having reached one million customers. 

Of the 5 billion Pix transactions made in Brazil each month, 29% come from Nu accounts. Colombian outlet La República writes about how Pix revolutionized payments in Brazil, with Nu at the forefront.

In an interview with Neofeed, Cris Junqueira discussed our investments in Mexico and the opportunities for international expansion. In the "Como você fez isso?" podcast, she discussed her career and Nubank's success.
 

Guilherme Lago, CFO, shared with IR Magazine the challenges and learnings he gathered throughout his career. He also talked to Euromoney about the uniqueness of our business model and how it has helped to expand access to credit in Latin America. 

During the Web Summit Rio de Janeiro, Nu's CTO Vitor Olivier spoke about how Nubank is focused on being AI-first to improve customer experience, optimize internal processes, and offer more personalized and efficient solutions.
 

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