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Table of Contents
a. Demand
Nu beat non-IFRS revenue estimates by 7% and beat IFRS revenue estimates by 2.6%. Note that IFRS stands for International Financial Reporting Standards. It’s the international version of GAAP.
The company missed deposit estimates by 1%. This was largely related to another sequential decline in Mexico as shown below.
For its first few years there, Nu offered especially high savings yields to build a critical base of deposits as a needed prerequisite for expanding into all of the credit offerings it wanted to provide. Now that it has gotten there and obtained the scale needed to support its other ambitions, the team is shifting some of the focus to monetization instead of maximum deposit pursuit aggression. The associated account yield reduction is leading to some taking their deposits elsewhere. But that was expected and the degree of this behavior has been what they assumed it would be. It's a concession they're willing to make in exchange for a 3-point reduction in cost of deposits.
Nu met net new customer estimates. They added 3 million new customers in Brazil compared to Q1 to reach 118 million. That marks a modest acceleration compared to their average during the previous 3 quarters, which is especially impressive given its Brazilian customer base is already massive. The company also added about 800K in Mexico since last quarter, which is a modest deceleration compared to recent quarters given Nu’s decision to lower deposit yields and pursue higher quality business.
Finally, while many criticize the methodology NU uses in terms of what is considered a customer, their active customer rate continues to be among the best in class and just crossed 86% in Brazil (its largest market by far) for the very first time.
b. Profits & IFRS margins
- Beat 40% GPM estimate by 150 basis points (bps; 1 basis point = 0.01%). A lot more on gross margin and risk-adjusted net interest margin (NIM) in the credit data section.
- On an FX neutral (FXN) basis, gross profit outgrew revenue by 4 points Y/Y.
- Beat net income estimate by 11.7%.
- Net income rose by 66% Y/Y & at a 3-year compounded annual growth rate (CAGR) of 68%.
NU’s efficiency ratio is its operating expenses divided by revenue, with lower being better. They got some temporary, timing-related help in Q1 2026 that led to the metric being 17.6%. It reverted to 19.5% this Q, which is still nearly 2 points better than its 21.3% result last year. This is despite investing about 1 point of incremental OpEx into USA expansion right now and, generally speaking, favoring more growth and global dominance over near-term margin optimization. As leadership says on the call, this quarter shows they can do both.
c. Balance Sheet & Credit Data
Balance Sheet Data: