Shares of Nu Holdings Ltd., widely known as Nubank, experienced a decline after the company reported its first-quarter earnings for 2025. Despite impressive growth in revenue and net income, lower-than-expected gross profits led to a slide in the company’s stock.
Nubank, one of the largest digital banks globally, saw its shares slide after reporting its earnings for the first quarter of 2025. Despite significant growth in revenue and net income, gross profits fell short of expectations due to higher credit loss allowances and increased interest expenses.
For the quarter ending March 31, Nubank posted revenue of $3.2 billion, exceeding the median estimate of $3.1 billion. Net income for the quarter reached $557.2 million, marking a 74% year-over-year increase. The company’s deposits and loan book also grew beyond analysts’ expectations.
However, Nubank’s gross profit came in below projections, which the company attributed to increased costs, particularly related to credit losses and higher interest expenses. Despite this, the bank added 4.3 million new customers during the quarter, bringing its total customer base to 118.6 million, spread across Brazil, Mexico, and Colombia.
In a statement, CFO Guilherme Lago highlighted that over the past four quarters, Nubank had added more customers than the top five incumbent banks in Brazil combined, underscoring the success of its customer acquisition strategy.
The bank’s loan book expanded to $24.1 billion, while deposits reached $31.6 billion. Of these deposits, $5.4 billion came from Mexico, where Nubank’s customer count grew to 11 million during the quarter. The company often offers higher interest rates on deposits to attract and retain customers.
Nubank is particularly focusing on growing its unsecured loans in Brazil, where the personal loan market holds significant potential for expansion. Lago stated that the company’s credit card market share is already large, and now, focusing on personal loans is the primary growth opportunity.
Despite the decline in stock price after the earnings report, Nubank remains a leading competitor to Itau Unibanco in the Latin American financial sector. As the company continues to grow, its expansion strategy is expected to play a crucial role in its future financial performance.
