Nu (NYSE:NU) has reported a stellar performance for the fourth quarter of 2025, demonstrating substantial growth in its customer base, increased revenue per active customer (ARPAC), and record-breaking profitability. The company's strategic focus on core market development, preparation for U.S. market entry, and the extensive integration of artificial intelligence are set to drive its future trajectory.
In 2025, Nu experienced significant expansion, adding 17 million new customers and bringing its total to 131 million, maintaining an impressive 83% activity rate. This growth underscores the company's ability to attract and retain users across its diverse markets. The average revenue per active customer (ARPAC) saw a healthy increase, reaching $15, which represents a 9% quarter-over-quarter and 27% year-over-year surge. This upward trend highlights Nu’s successful efforts in deepening customer engagement and monetization across its platform. Despite these gains, CEO David Vélez noted that Nu’s ARPAC still lags behind established competitors, indicating ample room for further cross-selling and product diversification.
Financially, the fourth quarter was particularly strong for Nu. Under its newly implemented Managerial P&L framework, the company reported a robust revenue of $4.9 billion, marking a 45% increase year-over-year. Net income soared to $895 million, a 50% rise from the previous year, and the return on equity (ROE) hit a record 33%. The efficiency ratio also improved significantly, dropping to 19.9% for the first time, reflecting effective operational leverage where net revenues outpaced operating expenses. The total portfolio expanded by 40% year-over-year, reaching $32.7 billion, largely fueled by growth in credit cards and unsecured lending. Deposits also increased by 29% to $41.9 billion, supported by growth in Brazil, Mexico, and Colombia, alongside improved funding costs.
Looking ahead to 2026, Nu is set for an “inflection year” with a three-pronged strategy. Firstly, the company aims to solidify its position in core markets, with a primary focus on Brazil and Mexico. Securing a banking license in Mexico is identified as a critical step for unlocking the next phase of credit growth. Secondly, Nu is laying the groundwork for international expansion, including operational preparations for the U.S. market, following conditional approval for a national bank charter. Lastly, AI is envisioned as a “superpower,” with plans to expand the use cases of its nuFormer foundation model, which is already in production for credit decisioning in Brazil, and to advance towards an AI-powered personal banker concept.
Management has indicated that 2026 will be a period of significant investment, which may temporarily impact efficiency ratios. This includes anticipated costs from a return-to-office transition, increased hiring and computing investments for AI, and expenditures to support global expansion. Despite these short-term pressures, the long-term outlook remains positive, with a strong capital position of $8.9 billion and available funding of $38.8 billion, providing substantial headroom for scaling credit and optimizing the balance sheet. Nu’s commitment to innovation and customer-centric financial solutions positions it for continued success in the evolving fintech landscape.