Nu Holdings Ltd. - Q2 2025 Financial Summary
Business Context and Reporting Period
This Form 6-K filing presents the unaudited interim condensed consolidated financial statements for Nu Holdings Ltd. for the three and six-month periods ended June 30, 2025. The report was reviewed by KPMG Auditores Independentes Ltda. Nu operates as a digital financial services provider with significant subsidiaries in Brazil (Nu Pagamentos, Nu Financeira, Nu Investimentos), Mexico (Nu Mexico Financiera), and Colombia (Nu Colombia). Notably, Nu Mexico Financiera received regulatory approval in April 2025 to begin converting into a bank.
Key Financial Metrics (Six Months Ended June 30, 2025)
| Metric | Value (USD) |
|---|---|
| Total Revenue | $6,916,159 |
| Net Income | $1,194,195 |
| Net Income Attributable to Shareholders | $1,194,041 |
| Earnings Per Share (Diluted) | $0.2439 |
| Gross Profit | $2,867,431 |
| Cash and Cash Equivalents | $13,269,017 |
| Total Assets | $62,730,144 |
| Total Liabilities | $53,154,028 |
| Total Equity | $9,576,116 |
| Operating Cash Flow | $3,640,032 |
Material Changes vs. Prior Period
- Revenue Growth: Total revenue increased by 23.8% year-over-year (from $5.58B to $6.92B) for the six-month period, driven by higher interest income and fee/commission income.
- Profitability: Net income rose by 37.9% year-over-year (from $866M to $1.19B). Profit before taxes increased from $1.30B to $1.67B.
- Expense Trends: Credit loss allowance expenses increased by 24.9% to $1.99B, reflecting portfolio growth. Marketing expenses rose 17.8% to $111M.
- Balance Sheet Expansion: Total assets grew 25.6% to $62.7B. Deposits increased significantly by 27.0% to $36.6B, serving as a primary funding source. Credit card receivables grew 24.1% to $15.1B.
- Currency Impact: Significant positive currency translation adjustments of $682.6M contributed to Other Comprehensive Income (OCI), contrasting with a loss of $492.4M in the prior year period.
Outlook, Risks, and Contingencies
- Regulatory Milestone: Nu Mexico Financiera is transitioning to a bank license, enabling an expanded portfolio of credit and financial products in Mexico.
- Taxation: A Provisional Measure (MP No. 1,303/25) proposes increasing the Social Contribution on Net Profit (CSLL) rate from 15% to 20% for credit and financing companies starting October 1, 2025. Management does not expect a significant impact on the current period but notes it is pending congressional review.
- Credit Risk: The Expected Credit Loss (ECL) allowance for credit cards and loans totaled $4.32B. Management monitors macroeconomic scenarios (upside, base, downside) to gauge probability weights. The coverage ratio for credit card receivables is 17.2%.
- Liquidity: The Group maintains a robust liquidity position with $13.3B in cash and equivalents. Funding is primarily sourced from deposits (90% of funding sources mature within 12 months).
- Legal Contingencies: Provisions for lawsuits and administrative proceedings total $27.9M, primarily related to civil risks ($20.6M). Additional possible losses are estimated at $13.3M.
Investor Verification Checklist
- Credit Quality: Verify the trend in the credit loss allowance coverage ratio (currently 17.2% for cards) against the growth in gross receivables.
- Deposit Stability: Assess the composition of deposits (RDB vs. Electronic Money) and the cost of funds relative to the Brazilian CDI rate.
- Regulatory Capital: Confirm the Capital Adequacy Ratio (CAR) for the Brazilian prudential conglomerate (15.9%) and Mexico (15.4%) remain above local minimums.
- FX Sensitivity: Monitor the impact of currency translation on equity, given the significant exposure to BRL, MXN, and COP.
- Tax Legislation: Track the status of the proposed CSLL rate increase in Brazil and its potential impact on future net margins.