Net income reached a record $894.8 million in Q4 2025, up 50% year-on-year, while return on equity hit an all-time high of 33% — ten percentage points above Itaú’s 23% — as the digital bank extended its streak of consecutive quarterly records.
Revenue surged 45% to $4.9 billion on the back of $15 monthly ARPAC, a 40% expansion in the credit portfolio to $32.7 billion, and an efficiency ratio that fell below 20% for the first time, while cost to serve held at just $0.80 per active customer.
Management flagged 2026 as an “investment year” that will pressure efficiency ratios near-term, as Nubank pursues a U.S. national bank charter, accelerates AI deployment, and prepares its Mexico subsidiary for full banking operations — a strategic pivot that has made NU the worst-performing LatAm financial stock year-to-date despite record fundamentals.
What Happened in Nubank Q4 2025
What Happened
Nubank (NYSE: NU / B3: ROXO34) reported its fourth-quarter and full-year 2025 results on February 25, delivering the highest quarterly net income in its history. The digital bank earned $894.8 million in the period, up 50% from the year-ago quarter, while full-year net income reached $2.87 billion — a 46% increase over 2024’s $1.97 billion.
Quarterly revenue hit $4.9 billion, up 45% year-on-year, as the platform added 4 million customers in Q4 alone, closing 2025 with 131 million users globally. For the full year, Nubank added 17 million net new customers, a 15% increase, cementing its status as the largest private financial institution in Brazil by customer count according to the Central Bank.
The stock closed the regular session at $16.67 on the NYSE, up 0.85% on the day. Following the earnings release, shares initially gained in after-hours trading before giving back those gains — falling 2.10% to $16.30 in extended trading. The BDR (ROXO34) last traded at around R$14.17 on B3. Despite consecutive record quarters, NU has been the worst-performing LatAm financial stock in 2026, declining roughly 3% year-to-date as investors weigh AI disruption risks against the company’s fundamentals.
Key Drivers Behind Nubank Q4 2025 Results
Key Drivers
Engagement and Monetization
Monthly average revenue per active customer (ARPAC) reached $15 in Q4, up 27% year-on-year and 9% sequentially, with mature cohorts generating roughly $25 per month. The monthly activity rate held at 83%, unchanged from prior quarters, demonstrating that the platform retains engagement even as it scales into newer, lower-ARPAC geographies.
CFO Guilherme Lago attributed the profit growth to three compounding forces: a larger customer base, rising revenue per active user, and stable cost to serve. This combination produces what management calls structural operating leverage — each new dollar of revenue carries disproportionately to the bottom line.
Credit and Balance Sheet
The total credit portfolio expanded 40% year-on-year and 11% quarter-on-quarter to $32.7 billion, while the total interest-earning portfolio (IEP) grew 47% to $18.5 billion. Total deposits reached $41.9 billion, up 29% year-on-year, with cost of funding holding at 87% of interbank rates — a competitive edge underpinned by Nu’s deposit base of 131 million retail accounts.
Net interest income climbed to $2.8 billion, a new all-time high and a 13% sequential increase. The risk-adjusted net interest margin came in at 10.5%, down 30 basis points from Q3 but up 60 basis points year-on-year. Management noted that NIM would have been broadly stable quarter-on-quarter absent a one-time $25 million contribution to Prosofipo, a sector-wide deposit protection fund that all Mexican Sofipos are required to support.
Operating Efficiency
The efficiency ratio declined to 19.9%, down from 20.3% in Q3 and 29.9% a year earlier — representing a full 10 percentage-point improvement in just twelve months. Monthly average cost to serve per active customer remained at $0.80, unchanged year-on-year despite significant growth in the customer base.
Gross profit rose to $1.96 billion, up 38% year-on-year and 7% sequentially. For the full year, gross profit totaled $6.6 billion, a 32% increase from 2024’s $5.0 billion. The combination of rising revenue per customer and flat unit costs has produced a widening margin structure that management calls the defining characteristic of Nu’s business model.
Financial Detail for Nubank Q4 2025
Financial Detail
Asset Quality
The 15-to-90-day NPL ratio in Brazil fell 20 basis points quarter-on-quarter to 4.1%, benefiting from the seasonal effects of the 13th-salary payments in Q4. This metric has now declined for three consecutive quarters from the 4.7% peak in Q1 2025. The 90+ day NPL ratio decreased 10 basis points to 6.6%, also improving sequentially.
Management introduced consolidated NPL metrics this quarter to reflect the platform’s multi-product, multi-geography scale. Given Brazil’s dominant share of the credit portfolio, consolidated trends continue to track the Brazilian book closely. Underwriting remains anchored by the proprietary nuFormer AI model, which has allowed the company to expand credit limits for qualifying borrowers without loosening its overall risk posture.
Quarterly Earnings Progression
Nubank’s earnings trajectory through 2025 shows accelerating momentum: Q1 net income of $557 million (27% ROE), Q2 at $637 million (28% ROE), Q3 at $783 million (31% ROE), and Q4 at $895 million (33% ROE). Each quarter set a new record, and the Q4 result exceeded the prior quarter by $112 million — the largest sequential dollar increase of the year. Adjusted ROE reached 35% in Q4, reflecting efficient capital deployment despite holding over $4.3 billion in excess capital across geographies.
Full-Year 2025 Summary
Full-year revenue reached $16.3 billion, up 45% from $11.5 billion in 2024. Net income totaled $2.87 billion, a 46% increase from $1.97 billion the prior year. The annual gross profit rose to $6.6 billion from $5.0 billion, while the efficiency ratio improved through every quarter — from 24.7% in Q1 to 19.9% in Q4. Customer additions of 17 million represented the company’s strongest year of organic growth since its founding in 2013.
Management Signals from Nubank Q4 2025 Earnings
CEO David Vélez framed 2026 as an inflection year in which the company transitions from a Latin American leader to a global digital banking platform. He emphasized that recent results reflect deliberate priorities and disciplined execution, not one-off tailwinds, and that the company remains focused on winning in its core markets while building long-term global capabilities.
CFO Lago was explicit that 2026 will be an “investment year.” The company is laying operational foundations for U.S. entry, accelerating AI adoption, and building next-generation infrastructure. He acknowledged that these deliberate investments will put upward pressure on the efficiency ratio near-term, but said the structural drivers of operating leverage — revenue growth, scale, and disciplined cost management — remain intact.
Lago also introduced a new Managerial P&L framework to improve transparency as the company scales across multiple products, segments, and countries. The new disclosure, fully reconciled to IFRS, is designed to provide clearer visibility into how margins and value creation evolve as each business line matures.
What to Watch Next for Nubank
Watch Next
The U.S. bank charter is the most consequential catalyst on the horizon. Nubank received conditional OCC approval on January 30, 2026, and must now obtain FDIC and Federal Reserve sign-offs, fully capitalize the institution within 12 months, and open the bank within 18 months. The U.S. entity — Nubank, N.A. — will be led by co-founder Cristina Junqueira, who has relocated to the United States, with former Central Bank of Brazil president Roberto Campos Neto as board chairman and ex-Acting Comptroller Brian Brooks as a director.
Mexico is approaching a critical threshold. The subsidiary received authorization to organize as a bank in April 2025 and is awaiting final operational approval, which management expects in 2026. Nubank already serves roughly 15% of Mexico’s adult population and is the largest Sofipo in the country. A full banking license would unlock deposit-taking and lending products that could materially expand ARPAC in the country.
In Brazil, Nubank is pursuing a domestic banking license to comply with Joint Resolution No. 17 from the Central Bank and National Monetary Council, which standardizes brand naming across regulated entities. The company’s brand and visual identity will remain unchanged, but the new license aligns its legal structure with its operational scale.
On the product side, the Mercedes-AMG PETRONAS F1 partnership, announced ahead of the 2026 season, signals Nubank’s intent to build global brand recognition beyond Latin America. The multi-year deal provides exposure to F1’s premium audience across key target markets, including the United States and Europe.
Nubank Key Figures Q4 2025
| Metric | Q4 2025 | Q3 2025 | Q4 2024 |
|---|---|---|---|
| Revenue | $4.9B | $4.2B | $3.4B |
| Net Income | $894.8M | $783.0M | $552.6M |
| ROE | 33% | 31% | 29% |
| Gross Profit | $1.96B | $1.81B | $1.42B |
| ARPAC (Monthly) | $15.0 | $13.4 | $11.1 |
| Efficiency Ratio | 19.9% | 20.3% | 29.9% |
| Credit Portfolio | $32.7B | $30.4B | $23.4B |
| Total Deposits | $41.9B | $38.8B | $28.9B |
| NPL 15-90 (Brazil) | 4.1% | 4.2% | 4.1% |
| NPL 90+ | 6.6% | 6.8% | 7.0% |
| Customers (Global) | 131M | 127M | 114M |
| Risk-adj. NIM | 10.5% | 9.9% | 9.5% |
Analyst Sentiment on Nubank
| Broker | Rating | Price Target |
|---|---|---|
| Goldman Sachs | Buy | $21.00 |
| Itaú BBA | Outperform | $20.00 |
| Morgan Stanley | Overweight | $18.00 |
| Rothschild Redburn | Buy | $18.00 |
| BofA Securities | Neutral | $18.00 |
| Consensus (16 analysts) | Strong Buy | $20.00 |
Risks Facing Nubank
Risks
The AI disruption narrative is the most immediate market risk. Nubank’s stock has underperformed all major LatAm financial peers year-to-date in 2026, not on fundamental deterioration but on fears that AI commoditizes the digital banking advantages — low cost to serve, data-driven underwriting, and personalized customer engagement — that form Nu’s competitive moat. Itaú BBA has pushed back on this thesis, arguing that Nubank is actually the main beneficiary of AI in the LatAm financial sector given its tech-native infrastructure, but the market has yet to re-rate the stock accordingly.
Execution risk around the U.S. expansion is substantial. Entering the American banking market means competing against entrenched incumbents with deep regulatory experience, navigating a complex multi-agency approval process, and building a brand from scratch in a market where Nubank has no name recognition. The costs of establishing U.S. hubs in four cities and capitalizing a de novo bank will pressure near-term profitability, while the revenue payoff is years away.
Credit cycle sensitivity remains a structural concern. The credit portfolio grew 40% in Q4 while NPLs improved, but Brazil’s Selic rate remains elevated and consumer over-indebtedness is at historic highs. A turn in the domestic credit cycle could force provisions upward and compress the risk-adjusted NIM that has been steadily expanding. The 90+ NPL ratio at 6.6% is notably higher than traditional bank peers, even if the trajectory is improving.
Currency risk is embedded in the company’s geographic structure. Nubank reports in U.S. dollars but generates the majority of its revenue in Brazilian reais and Mexican pesos. BRL depreciation against the dollar mechanically reduces reported revenue and earnings, as seen in 2024 when FX effects masked some of the underlying operational strength. With Brazil’s fiscal outlook still uncertain, further currency weakness remains a possibility.
Sector Context for Nubank Q4 2025
Nubank’s 33% ROE now decisively surpasses Itaú Unibanco’s 23% for Q4 2025 — a milestone that inverts the traditional hierarchy of Brazilian banking returns. The gap is all the more striking because Itaú’s return profile benefits from a mature, fully diversified franchise, while Nu is still in its growth phase with over $4.3 billion in excess capital that compresses its equity denominator. As Nu deploys that capital into the U.S. and Mexico, the ROE premium over incumbents will face downward pressure even if earnings continue to grow.
The broader competitive landscape is shifting in Nu’s favor. The company is now the largest private financial institution in Brazil by customer count, per Central Bank data, surpassing Itaú, Bradesco, and Santander. In Mexico, the 15% adult population penetration makes Nu a formidable challenger to BBVA Mexico and Banorte, which have spent decades building their branch networks. Colombia remains earlier-stage but is approaching 4 million customers.
The market is pricing Nu at roughly 31x trailing earnings — a premium to traditional Brazilian banks trading at 5–8x, but a discount to the stock’s own all-time high multiple. With 16 of 16 covering analysts rating the stock a Buy and a consensus target near $20, the Street sees roughly 20% upside from current levels. The disconnect between record operating performance and the worst YTD stock performance among LatAm financials creates a setup where the next catalyst — U.S. charter progress, Mexico banking license activation, or a sentiment shift on AI — could trigger a sharp re-rating.