Nu Holdings (NU) Shares Plunge 9% Following Strong Q4 Results

Key Takeaways

• Q4 net profit reached $894.8 million for Nu Holdings (NU), marking a 50% year-over-year increase
• Revenue climbed 45% to $4.86 billion while customer count expanded to 131 million throughout Brazil, Mexico, and Colombia
• Shares declined 9.55% on Feb. 26, finishing at $15.06 even after surpassing revenue projections
• Market participants expressed concern about rising operational costs and unclear margin outlook
• The company secured conditional OCC approval in January 2026 to operate a U.S. national bank

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On Feb. 25, 2026, Nu Holdings (NU) unveiled impressive fourth-quarter results for 2025, yet shares tumbled 9.55% the next trading session to settle at $15.06.

The market reaction surprised many observers, given the company’s robust performance metrics.

Quarterly net profit reached $894.8 million, representing a 50% jump from the $552.6 million recorded in Q4 2024. Total revenue climbed to $4.86 billion, reflecting 45% annual growth and exceeding Wall Street expectations of approximately $4.55 billion.

Nu Holdings Ltd., NU

The financial services company achieved a 33% return on equity while its efficiency ratio improved to 20%.

Customer acquisition remained strong with 17 million new users joining during the quarter. By year-end 2025, Nubank served 131 million customers throughout its three operating markets—Brazil, Mexico, and Colombia. This represented 15% annual growth and penetration of 62% among Brazilian adults.

Revenue per active customer (ARPAC) increased 27% year-over-year to $15, boosted by growth in credit products, float revenue, and fee-based services.

The company’s total loan book grew 40% to $32.7 billion. Delinquency rates for loans past 90 days improved slightly, declining 0.1 percentage points to 6.6%.

Market Concerns That Drove the Selloff

JPMorgan analysts observed that the profit beat stemmed primarily from a lower tax rate rather than core operational strength. This observation provided ammunition for skeptical investors.

The market also reacted negatively to management’s lack of specific forward-looking guidance on profitability margins, creating uncertainty about future performance.

Shares initially spiked 4% immediately following the earnings release, but momentum reversed sharply. By the Feb. 26 close, NU had fallen as much as 9.55%. After-hours trading showed continued weakness with shares hovering around $15.07.

CFO Guilherme Lago attributed the profit gains to expanding customer numbers, improved revenue per user, and controlled servicing costs. CEO David Vélez characterized 2025 as a “fantastic year” for the company.

Building a Presence in the United States

January 2026 brought significant news when Nubank obtained conditional OCC approval for a U.S. national bank charter—the first of three required regulatory clearances. The firm has a 12-month window to satisfy capitalization requirements.

Vélez recognized the challenging competitive landscape in U.S. banking but emphasized opportunities within targeted customer segments.

Looking ahead to 2026, leadership highlighted key strategic priorities: securing Mexico’s banking license, expanding services for small businesses and affluent customers, and integrating artificial intelligence throughout operations.

Wall Street sentiment remains largely positive. Analyst price targets for the next 12 months span from $18.05 to $22.00, suggesting potential gains of 20% to 46% from current trading levels. The majority of ratings are in Buy territory.

Shares have traded between $9.01 and $18.98 over the past 52 weeks, with the recent peak near $18.98 occurring in late January 2026. Current market capitalization stands between $78 billion and $80 billion.

The company’s next quarterly report is scheduled for May 14, 2026, covering first-quarter 2026 performance.

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