Nubank (NU) Soars 10% After Stellar Q2 2025 Earnings Beat Analysts’ Expectations

• Why Did Nubank’s Stock Jump 10% Today?
• Breaking Down Nubank’s Q2 Financials
• Analysts’ Take: Strong Results, Neutral Stance
• Mexico Expansion and Revenue Diversification
• Risks and Challenges Ahead
• FAQs About Nubank’s Q2 Performance

Nubank (NYSE: NU) shares surged 10.3% to $13.25 after reporting a stronger-than-expected Q2 2025 performance, with net income hitting $637 million (R$3.6 billion), up 11% QoQ. Analysts praised the results but maintained "neutral" ratings, citing valuation concerns. Key highlights include a 28% ROE, 11% growth in net interest income (NII), and controlled credit quality despite macroeconomic headwinds. Here’s a DEEP dive into the numbers and what experts are saying.

Why Did Nubank’s Stock Jump 10% Today?

Nubank’s Q2 2025 earnings report was a blockbuster, smashing estimates from major banks like Itaú BBA (by 12%) and Safra (by 6%). The fintech giant posted a net profit of $637 million, fueled by robust credit expansion (up 40% YoY) and a 28% return on equity—well above industry averages. Investors cheered the results, sending shares soaring 10.3% by midday trading. But analysts remain cautious, arguing the stock already prices in much of this growth.

Breaking Down Nubank’s Q2 Financials

The numbers tell a compelling story:

• Credit Portfolio: R$148.2 billion (+8% QoQ), with cards leading growth.
• Net Interest Margin (NIM): Expanded by 0.20 pp in Brazil, aided by lower funding costs.
• Efficiency Ratio: Rose to 28% due to higher marketing and stock-based compensation expenses.
• Customer Base: Reached 122.7 million (+4.2 million QoQ).

Analysts’ Take: Strong Results, Neutral Stance

Here’s the consensus from Wall Street’s top desks:

• Itaú BBA: Praised card revenue recovery and "solid" asset quality but flagged weak service revenue growth.
• Safra: Highlighted NIM upside but warned of overreliance on high-yield credit in a tough macro climate.
• XP Investimentos: Called results "solid" but said shares fairly value near-term prospects.

Mexico Expansion and Revenue Diversification

Nubank’s Mexican operations are gaining traction, complementing its Brazilian core. Management also emphasized cross-selling insurance and investment products—key to boosting average revenue per user (ARPU). As one BTCC analyst noted, "Their ability to monetize 122 million customers without sacrificing credit quality is impressive, but execution risks remain."

Risks and Challenges Ahead

Operational expenses jumped 24% YoY, and delinquency rates inched up slightly (though still manageable). The macro backdrop—high interest rates, inflationary pressures—could squeeze margins. As Safra’s team quipped, "Nubank’s flying high, but turbulence isn’t off the table."

FAQs About Nubank’s Q2 Performance

What drove Nubank’s earnings beat?

Higher net interest income (+11%), lower-than-expected provisions, and strong card revenue growth.

Why are analysts neutral despite good results?

Valuation concerns—the stock’s 2025 P/E of ~25x already reflects much of its growth potential.

Is Nubank’s Mexico expansion working?

Early signs are positive, but Brazil still contributes ~90% of revenue. Mexico’s contribution is growing steadily.