Nu Holdings Ltd. · NYSE:NU
Nu — Q4 2024 Earnings Presentation
46 slides from Nu's earnings presentation, Feb 20, 2025
Slide 1: Q4 2024 Earnings Presentation
Q4 2024 Earnings Presentation Feb 20, 2025 Fourth Quarter 2024 Results 1
Slide 2: Welcome
Jörg Friedemann Welcome Investor Relations Officer Fourth Quarter 2024 Results 2
Slide 3: Presenting executives
David Vélez Youssef Lahrech Guilherme Lago Jag Duggal Founder, Chief President and Chief Financial Officer Chief Product Officer Executive Officer and Chief Operating Chairman Officer Fourth Quarter 2024 Results 3
Slide 4: Disclaimer
Disclaimer This presentation speaks at the date hereof and the Company is under no obligation to update or keep current the information contained in this presentation. Any information expressed herein is subject to change without notice. Any market or other third- party data included in this present
Slide 5: Continued Growth of One of the World's Largest Digital Banking Platforms
Continued Growth of One of the World's Largest Digital Banking Platforms 2024 Main Highlights Customers (MM) 114 110 114.2MM Customers 94.9MM Active Customers 105 99 +20.4M YoY from 93.9MM +22% YoY from 78.0MM 94 58% of Adult Population of Brazil 83% Monthly Activity Rate 89 84 79 US$28.9BN Total De
Slide 6: Profitability Momentum Continues: 2024FY Nu Holdings ROE at 28%
Profitability Momentum Continues: 2024FY Nu Holdings ROE at 28%, Despite Significant Excess Capital Financial Performance (US$MM) Metrics Q4’23 Q1’24 Q2’24 Q3’24 Q4’24 2023FY 2024FY Revenues 2,405 2,736 2,849 2,943 2,989 8,029 11,517 YoY FXN 57% 64% 65% 56% 50% 62% 58% Gross Profit 1,143 1,182 1,359
Slide 7: Our Performance in 2024 Against Our Company Priorities
Our Performance in 2024 Against Our Company Priorities Ramp up Secured Lending Progress High Income and Money Platform becoming Win in Mexico in Brazil Supercore in Brazil a reality • 10MM Customers in 2024, +91% • US$1.4BN Portfolio, +615% YoY • 688K Ultravioleta (UV) • Over 1.0MM Customers activel
Slide 8: Q4'24 Results
Q4'24 Results Fourth Quarter 2024 Results 8
Slide 9: Strong Customer Acquisition and Solid Activity Rate
Strong Customer Acquisition and Solid Activity Rate Customers YoY: +22% Customers (MM) Active Customers YoY: +22% Active Customers 78.0 82.6 87.2 91.7 94.9 (MM) 109.7 114.2 104.5 99.3 93.9 Activity Rate (%) 83.4% 83.6% 83.1% 83.2% 83.1% Q4'23 Q1'24 Q2'24 Q3'24 Q4'24 Fourth Quarter 2024 Results 9 Not
Slide 10: Compounding Effect of More Engagement and More Cross-sell Driving ARPAC Expansion
Compounding Effect of More Engagement and More Cross-sell Driving Ongoing ARPAC Expansion Active Customers Using NuAccount Number of Products Per Monthly ARPAC by Quarterly Cohort as their Primary Banking Account (%) Active Customer (US$ | FX Neutral) US$ month/ Avg. monthly ARPAC of US$10.7/month w
Slide 11: Sustained Revenue Growth Fueled by Customer Acquisition and ARPAC Expansion
Sustained Revenue Growth Fueled by Customer Acquisition and ARPAC Expansion Monthly ARPAC (US$) Revenues (US$MM) YoY: 23% YoY: 50% FXN FXN 9% 6% 8% 11.4 FXN 2% 5% 8% 2,943 FXN 2,989 FXN 11.2 FXN 11.0 FXN 2,849 FXN 10.6 10.7 2,736 12% FXN 2,405 FXN 15% Q4'23 Q1'24 Q2'24 Q3'24 Q4'24 Q4'23 Q1'24 Q2'24
Slide 12: Strong Performance for Both Credit Card and Lending Portfolios
Strong Performance for Both Credit Card and Lending Portfolios, with Lending Gaining More Relevance Over Time Total Portfolio (US$BN) Total Portfolio (%) Lending Credit Cards YoY: 45% Lending Credit Cards FXN Credit Card: 28% FXN Lending: 110% FXN 20.9 20% 23% 24% 8% 7% 13% 20.7 27% 29% 12% FXN 19.6
Slide 13: Interest Earning Portfolio over Total Portfolio Consistently Outperforms the Market
Interest Earning Portfolio over Total Portfolio Consistently Outperforms the Market as Nu Expands Financial Products and Features Credit Card IEP Evolution Nu Interest Earning Installments Balance Nu Revolving Balance Nu Non-Interest Earning Balance (% of Total Receivables – Brazil Only) Market Inte
Slide 14: Sustained Sequential Growth in Secured and Unsecured Loan Origination
Sustained Sequential Growth in Secured and Unsecured Loan Origination Originations (R$BN) YoY: 84% Brazil Only BRL Unsecured Lending Secured Lending 16% BRL 18.4 22% BRL 15.9 12% 2.8 BRL 6% 23% BRL 12.3 BRL 13.0 39% BRL 2.5 16% 15.6 Credit 6% BRL Yield BRL 1.8 13.4 (%) 10.0 70% BRL 1.7 6% 20% BRL 10
Slide 15: Robust Deposit Franchise Fueled By Volume Growth
Robust Deposit Franchise Fueled By Volume Growth and Cost of Deposits Aligned with Nu’s Strategy in New Geos Deposits (US$BN) YoY: 55% Brazil FXN Mexico 28.9 16% Colombia 9% FXN 28.3 FXN 0.9 1.3 25.2 16% 55% 23.7 6% FXN 24.3 FXN 0.2 299% FXN 3.9 FXN 4.5 61% 20% Cost of 1.0 2.3 FXN 3.3 27% FXN Deposi
Slide 16: Net Interest Income Expansion Driven by Growth in Interest Earning Portfolio
Net Interest Income Expansion Driven by Growth in Interest Earning Portfolio NII (US$MM) & NIM (%) YoY: 57% FXN 1,718.1 4% FXN 1,712.8 9% FXN 1,745.7 1,619.5 14% FXN 1,345.7 21% FXN NIM (%) 19.5% 19.8% 18.3% 18.4% 17.7% Q4'23 Q1'24 Q2'24 Q3'24 Q4'24 Note 1: ‘NII’ stands for Net Interest Income and i
Slide 17: Low Cost to Serve Underscores Operating Leverage Potential
Low Cost to Serve Underscores Operating Leverage Potential Cost to Serve per Active Customer (US$) YoY: 11% FXN 0% 8% 0.9 0.9 0.9 FXN FXN -15% FXN 0.8 21% FXN 0.8 -10% FXN 14% adjusted FXN adjusted Q4'23 Q1'24 Q2'24 Q3'24 Q4'24 Note 1: Amounts are presented in US dollars and growth rates on an FX Ne
Slide 18: Sustained Gross Profit Growth, Despite FX Headwinds
Sustained Gross Profit Growth, Despite FX Headwinds Gross Profit (US$MM) YoY: 44% FXN 1,359.4 3% FXN 1,348.6 8% FXN 1,363.4 23% 1,143.2 4% FXN 1,181.6 FXN Gross Profit Margin (%) 47.5% 47.7% 45.8% 45.6% 43.2% Q4'23 Q1'24 Q2'24 Q3'24 Q4'24 Fourth Quarter 2024 Results 18 Note 1: Amounts are presented
Slide 19: Strong Track Record of Driving Operating Leverage as Business Scales
Strong Track Record of Driving Operating Leverage as Business Scales Efficiency 91.6% NII + F&C (US$MM) Costs (US$MM) Efficiency Ratio 10% 2,241.3 75.8% 2,183.5 4% 2,182.2 FXN 2,075.2 13% FXN 72.7% 72.3% 16% FXN 1,799.3 FXN 13% 65.6% FXN 12% 1,599.1 16% FXN 1,415.2 58.2% 11% FXN 55.1% FXN 1,178.5 1,
Slide 20: Sustained Growth in Both Net Income and Adjusted Net Income
Sustained Growth in Both Net Income and Adjusted Net Income Adjusted Net Income YoY: Net Income (US$MM) +87% FXN Adj. Net Income (MM) 395.8 442.7 562.5 592.2 610.1 Adj. Net Income Margin (%) 17% 16% 20% 20% 20% YoY: 85% FXN 18% 553.4 7% FXN 552.6 487.3 FXN Net Income Margin 38% (%) FXN 360.9 6% FXN
Slide 21: Q4'24 Credit Underwriting
Q4'24 Credit Underwriting Fourth Quarter 2024 Results 21
Slide 22: Delinquency Ratios Tracking Expectations
Delinquency Ratios Tracking Expectations 15-90 NPLs 90+ NPLs Brazil Consumer Credit Portfolio Brazil Consumer Credit Portfolio 7.2% 7.0% 6.2% 6.1% 7.0% 5.9% 5.6% 5.5% 6.3% 6.1% 5.0% 5.0% 5.1% 5.1% 5.2% 5.2% 4.4% 4.5% 5.1% 5.1% 5.0% 4.2% 4.3% 4.9% 5.0% 4.7% 3.7% 4.4% 4.5% 3.4% 4.2% 4.1% 4.1% 4.1% 3.1
Slide 23: NPL Ratios Over IEP Balance Imply Stable Credit Risk
NPL Ratios Over IEP Balance Imply Stable Credit Risk Through the Product Cycle 15-90 NPLs Over IEP Balance 90+ NPLs Over IEP Balance Brazil Consumer IEP Brazil Consumer IEP 36.8% 35.5% 28.8% 25.4% 19.9% 15.1% 14.3% 14.1% 13.0% 13.6% 12.9% 13.8% 12.8% 12.1% 15.6% 12.1% 10.7% 10.4% 10.2% 14.1% 13.9% 1
Slide 24: Frictionless Renegotiation Experience Helps Limit Impact on Risk
Frictionless Renegotiation Experience Helps Limit Impact on Risk Renegotiated Balance (US$BN) Coverage Ratio & NPLs of Renegotiated Balance (%) Brazil Credit Portfolio % Renegotiated Before 15 Days Overdue 50% Coverage Ratio 90+ NPLs 43 0. 0% 11.3% 11.3% 403.5% % Renegotiated Between 15 & 90 Days Ov
Slide 25: Risk-Adjusted NIM Performance Reflecting Portfolio Growth
Risk-Adjusted NIM Performance Reflecting Portfolio Growth and Reduction in Cost of Risk Credit Loss Allowance (US$MM) & Risk Adj. NIM (%) 830.7 6% 12% 804.4 759.8 FXN 774.1 FXN -2% FXN 41% Risk Adj. 592.5 FXN NIM (%) 11.0% 10.2% 10.1% 9.5% 9.5% Q4'23 Q1'24 Q2'24 Q3'24 Q4'24 Note 1: ‘CLA’ stands for
Slide 26: Superior Credit Underwriting Across Risk Scores for Credit Cards
Nu has Shown Superior Credit Underwriting Across Risk Scores for Credit Cards NPL 90+ By Risk Band Nu Defined by Risk Score Market 2 to 200 201 to 400 401 to 500 46.4% 49.7% 26.7% 29.2% 7.2% 5.8% 31.9% 18.3% 27.5% 14.2% 3.3% 2.2% Jan 23 Sep 24 Jan 23 Sep 24 Jan 23 Sep 24 501 to 600 601 to 700 701 to
Slide 27: Wrapping Up
Wrapping Up Fourth Quarter 2024 Results 27
Slide 28: Looking Ahead: Three Act Strategy
Looking Ahead Three Act Strategy Act I: Building the Largest and Most Loved Retail Banking Franchise in LatAm Act II: Expand Beyond Financial Services Act III: A Global AI-Driven Digital Banking Model Fourth Quarter 2024 Results 28 Source: Nu.
Slide 29: Q&A
Q&A Fourth Quarter 2024 Results 29
Slide 30: Appendix
appendix Fourth Quarter 2024 Results 30
Slide 31: Purchase Volume Growth Remains Strong YoY
Purchase Volume Growth Remains Strong YoY Purchase Volume (US$BN) Purchase Volume per Customer (US$) $400 Prepaid/Debit Cards YoY: 20% FXN US$ month/ For constant risk mix analysis, please refer to Adj. Purchase Volume slide customer Credit Cards FXN $350 Credit Card: 20% FXN Prepaid/Debit Card: 18%
Slide 32: Consistent Growth and ARPAC Acceleration Across All Cohorts
Consistent Growth and ARPAC Acceleration Across All Cohorts Adjusted By Constant Risk Mix Adj. Purchase Volume (US$) Adj. ARPAC (US$) per Customer $25 $450 FXN US$ FXN US$ month/ Brazil Only month/ Brazil Only customer customer $400 $20 $350 $300 $15 $250 $200 $10 Q1’17 2017 Q1’17 2017 $150 $100 $5
Slide 33: Comfortable Capital and Liquidity Positions
Comfortable Capital and Liquidity Positions Capital Position (US$Bn) Liquidity Position (US$Bn) Nu Holdings Cash & Equivalents 6.3 LDR 28.9 Capital Excess 39% Capital Requirement 2.2 4.1 2.15x 2.1 2.1 11.2 2.0 2.0 Capital in our Geos Nu Holdings Interest Earning Portfolio Total Deposits Fourth Quart
Slide 34: Formation Ratios Tracking Expectations
Formation Ratios Tracking Expectations NPL Formation Stage 3 Formation Brazil Consumer Credit Portfolio Brazil Consumer Credit Portfolio 3.9% 3.5% 3.4% 4.2% 3.0% 3.2% 3.2% 3.3% 3.7% 3.6% 3.6% 2.9% 2.9% 2.9% 3.0%3.0% 3.4% 3.4%3.3%3.4% 2.5% 2.6% 2.6% 3.1%3.2% 3.1% 2.9% 2.7% 2.6% 1.9%2.0%1.9% 2.1% 2.5%
Slide 35: Coverage Ratios Reflect NPL Dynamics
Coverage Ratios Reflect NPL Dynamics Coverage Ratio Over Total Balance Coverage Ratio Over NPL 90+ Brazil Consumer Credit Portfolio Brazil Consumer Credit Portfolio 15.3% 14.8% 14.9% 14.4% 13.7% 262.6% 263.9% 257.5% 13.5% 12.6% 242.5% 235.2% 222.2% 229.1% 11.6% 10.9% 213.3% 211.9% 238.0% 10.6% 199.0
Slide 36: Portfolio Growth Main Factor of Provision Balance Increase
Portfolio Growth Continues to be the Main Factor of Provision Balance Increase Provisions Bridge (US$MM, FXN) (204) 476 318400% 291200% 3,184 2,912 0% 0% Q3'24 ECL Growth Other Q4'24 ECL Note 1: The information presented is for Nu Holdings and includes both credit card and lending provision balance.
Slide 37: Loan Portfolio (FX Neutral) (1/2)
Loan Portfolio (FX Neutral) (1/2) Steady Credit Book Expansion Total Portfolio (FXN US$BN) YoY: 45% Lending FXN Credit Card IEP Lending: 110% FXN Credit Card IEP: 46% FXN Credit Card non-IEP Credit Card non-IEP: 20% FXN 13% FXN 20.7 7% 8% FXN 18.4 FXN 17.2 22% 11% 15.9 19% FXN FXN 6.1 FXN 14.3 17% 5
Slide 38: Loan Portfolio (FX Neutral) (2/2)
Loan Portfolio (FX Neutral) (2/2) Steady Credit Book Expansion Total Portfolio (FXN US$BN) YoY: 45% Lending FXN Credit Card IEP Lending: 110% FXN Credit Card IEP: 46% FXN Credit Card non-IEP Credit Card non-IEP: 20% FXN 13% FXN 20.7 7% 8% FXN 18.4 FXN 17.2 22% 11% 15.9 19% FXN FXN 6.1 FXN 14.3 17% 5
Slide 39: Non-IFRS Financial Measures and Reconciliations
Non-IFRS Financial Measures and Reconciliations This presentation includes financial measures defined as “non-IFRS financial measures” by the SEC, including: Adjusted Net Income and certain FX Neutral measures and provides reconciliations to the most directly comparable IFRS financial measure. A non
Slide 40: Non-IFRS Financial Measures and Reconciliations
Non-IFRS Financial Measures and Reconciliations Adjusted Net Income As reported As reported Nu Holdings - Consolidated For the three months ended December 31, For the year ended December 31, Adjusted Net Income (US$ million) 2024 2023 2024 2023 Profit attributable to shareholders of the parent compa
Slide 41: Non-IFRS Financial Measures and Reconciliations
Non-IFRS Financial Measures and Reconciliations Q4’22 and FY22 Metrics adjusted by the CSA cancellation Nu Holdings - Consolidated December 31, 2022 As presented in the financial CSA termination As presented in the earnings US$ million statements adjustment presentation Net income (loss) – for the t
Slide 42: Non-IFRS Financial Measures and Reconciliations
Non-IFRS Financial Measures and Reconciliations Equity and Annualized ROE/Adjusted ROE US$ million Reconciliation - ROE Nu Holdings - Consolidated Q4'23 Q1’24 Q2’24 Q3’24 Q4’24 FY23 FY24 Total equity at the end of the period/year 6,406.4 6,802.7 6,923.4 7,644.3 7,647.1 6,406.4 7,644.3 Net Income for
Slide 43: Non-IFRS Financial Measures and Reconciliations
Non-IFRS Financial Measures and Reconciliations FX Neutral measures are prepared and presented to eliminate the effect of foreign exchange, or “FX,” volatility between the comparison periods, allowing management and investors to evaluate financial performance despite variations in foreign currency e
Slide 44: Non-IFRS Financial Measures and Reconciliations
Non-IFRS Financial Measures and Reconciliations FX Rates - On a monthly basis, Nu translates its subsidiaries figures from their individual functional currency into Nu Holdings functional currency, the U.S. Dollars ("US$"), following the requirements of IAS 21 "The Effects of Changes in Foreign Exch
Slide 45: Non-IFRS Financial Measures and Reconciliations
Non-IFRS Financial Measures and Reconciliations As of August 31, 2024, income statement figures were divided by the average FX Rate of the month (R$ 5.5539, MXN 19.1871 and COP 4,070.7200 to US$ 1.00) and balance sheet figures were divided by the last price FX Rate of the month (R$ 5.6075, MXN 19.72
Slide 46: www.investors.nu investors@nubank.com.br
www.investors.nu investors@nubank.com.br Fourth Quarter 2024 Results 46