Nu Holdings passes 135M customers as Brazil and Mexico expansion accelerates

Nu Holdings now serves 135 million customers across Latin America, with record quarterly revenue of $5 billion and net income of $871 million.

Nu Holdings' branchless model is scaling faster than most digital-banking peers, but rapid unsecured lending is pushing provisions higher as the company prepares for a measured entry into the US market.

"Mexico reached IFRS profitability ahead of our internal plan, confirming the playbook we built in Brazil transfers to new markets," a company spokesperson said.

First-quarter net income rose 41% on an FX-neutral basis to a record $871 million, while the efficiency ratio fell to 17.6%. The credit portfolio expanded 40% to $37.2 billion, led by a 53% jump in unsecured lending. Early-stage delinquencies rose to 5% from 4.11% at year-end, which management attributed to seasonality and portfolio mix rather than deteriorating credit quality.

NU shares trade at 13.48 times forward earnings, a discount to SoFi Technologies at 24.53 times but a premium to StoneCo at 4.9 times. The valuation assumes continued execution in Mexico and measured entry into the US, where Nu received conditional approval for a national bank charter with a target 2027 launch.

Mexico Turns Profitable as Customer Base Reaches 15 Million

Nu's Mexican operation has grown from about 2 million customers four years ago to 15 million, capturing less than 1% of the profit pool in an underbanked market of more than 120 million people. Monthly average revenue per active customer across the group rose to about $16, while the activity rate held at 83%. The company's small-business banking unit in Brazil now serves about 5 million customers, many acquired by cross-selling to existing personal-banking users, creating a base for further growth in business cards and loans without large customer-acquisition spending.

Credit Growth Outpaces Provisions, but Delinquencies Bear Watching

Total credit exposure, including available card limits, rose 44% to $70.7 billion, with credit cards and unsecured loans making up 98% of new exposure. The risk-adjusted net interest margin declined to 9.5% from 10.5%, reflecting the shift toward higher-yield but riskier unsecured products. Earnings estimates for 2026 and 2027 imply year-over-year growth of 33.87% and 38.07%, respectively, though consensus has remained flat over the past 60 days as analysts weigh the growth trajectory against rising provisions.

NU shares have gained about 6.3% over the past month, outperforming SoFi's 1.1% rise and StoneCo's 3.8% gain. The company is using artificial intelligence to speed credit decisions — proprietary models assess individual loan requests in under one second — and to lower servicing costs, with AI-based financial tools already serving more than 15 million monthly active users. Engineering output increased more than 50% year over year, management said.

For investors, the question is whether Nu's Latin American scale and Mexico expansion can sustain above-average growth without a deterioration in asset quality. The stock's 13.48 times forward multiple prices in continued execution, leaving little room for error if delinquencies rise further or the US entry faces regulatory delays.

This article is for informational purposes only and does not constitute investment advice.