Nu Holdings Ltd., One of the largest digital financial services platforms in the world, released its financial results for the second quarter of 2022 on Monday.
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“We had another very strong quarter, with growth and profitability in our business. We posted record revenues and are making great strides in becoming a multi-product, multi-country platform. Our largest operation, Brazil, is now profitable, posting a profit net of US$13 million in the first half of 2022, driven by customer growth to 65 million, and our ability to launch and cross-sell new products We are the fourth largest credit card player, almost a a quarter of all PIX operations go through our digital accounts (NuContas), and we are leaders in the investment segment with 5 million active clients.We are diversifying and scaling with crypto, insurance, SME products and personal loans. Internationally, we are now the #1 issuer of new credit cards in Mexico and Colombia, where we just received approval for our license to continue go with the expansion”, said David Vélez, founder and CEO.
OUTSTANDING OPERATIONAL RESULTS
• Customer growth: Nu added 5.7mn clients in the quarter, reaching a total of 65.3mn clients in Brazil, Mexico and Colombia. This represents YoY growth of 57%, reinforcing Nu’s position as one of the world’s largest digital banking platforms.
• Participation and activity rates: The average revenue per active customer, Average Revenue per Active Customer (ARPAC), increased to $7.8 dollars, growing 105% on a FX neutral (FXN)1 basis. The activity rate reached a new historic record, growing to 80%. Nu has become the primary bank for more than 55% of monthly active customers who have been with the company for more than a year.
• Low cost operating platform: The average monthly cost of service per active client reached $0.8 dollars, remaining flat year-over-year and FXN.
• Asset quality: Leading indicators remained stable and asset quality continued its post-pandemic normalization: 15-90 NPLs remained stable at 3.7% while 90+ reached 4.1% online with expectations.
OUTSTANDING FINANCIAL RESULTS
• Income: Total revenue for the second quarter of 2022 reached a new record of $1.2 billion, rising 230% year-on-year FXN, driven by continued effective cross-selling of its broad portfolio of financial products.
• Gross profit: It reached a total of $363.5 million in the second quarter of 2022, increasing 109% year-on-year FXN. Gross profit margin was 31% in the second quarter of 2022.
• Adjusted net income: Nu reported adjusted net income of $17 million in the second quarter of 2022.
• Capital: As of June 30, 2022, Nu continued to show a strong capital position with NuFin’s adjusted capital reaching $3.9 billion, of which 79% was cash and cash equivalents.
HIGHLIGHTED BUSINESS RESULTS
• Customer base growth: Ehe number of Brazilian clients increased 51% year-on-year to 62.3 million, now representing 36% of the country’s adult population, and our SME client base grew 150% YoY to 2 .0 million. This positions Nu as the fifth largest financial institution in Brazil in terms of number of clients. Purchase volume reached $20 billion in the second quarter, with FXN growing 94% year-on-year, positioning Nu as the fourth largest card player in Brazil this quarter (in terms of purchase volume).
• Multiproduct Platform: During the quarter, the main products -Credit Cards, NuConta and Personal Loans- reached 29 million, 45 million and 4 million active clients, respectively. Insurance, launched last year, reached more than 700,000 active clients, NuInvest, Nu’s investment platform, has reached more than 5 million active clients and NuCripto reached 1 million clients in July 2022, only 3 weeks after its release.
• Profitability in Brazil: NuBrasil, the company’s main market, achieved net income in the first half of 2022 of $13.0 million, a very important milestone. The profitability of our main products – Credit Cards, Personal Loans and NuConta – has allowed us to reinvest those profits in the introduction of adjacent verticals in Brazil, while supporting our expansion in Mexico and Colombia.
• International expantion: In Mexico, our second largest market, Nu’s customer base increased 6x year over year to 2.7 million, consolidating the Company’s position as the number 1 issuer of new credit cards in the country. In Colombia, Nu has become the fastest growing credit card issuer, reaching 314,000 clients in the quarter. Together, these two countries added 700,000 unique customers, maintaining an NPS of around 90 in both markets.
BRIEFCASE
