PagSeguro Digital Ltd. Q4 FY2025 earnings call

Ricardo Dutra mentioned the continued expansion of credit and banking businesses along with the reacceleration of acquiring volumes. TPV grew 10% quarter-over-quarter. The expanded credit portfolio reached BRL 50 billion, with loans, credit cards and working capital up 33% year-over-year. Deposits grew 13% year-over-year to BRL 40 billion. Total net revenue excluding interchange and card scheme fees increased 12% year-over-year. Non-GAAP net income grew 7.4% year-over-year. Carlos Mauad discussed the operational and commercial performance, including a customer-centric approach with cash-in reaching over BRL 90 billion, up 11% year-over-year. The credit portfolio was at BRL 4.6 billion, up 33% year-over-year. Gustavo Sechin talked about the consolidated financial results, with revenue growth outpacing TPV, banking revenue growth, operational leverage, and financial costs increasing but operating expenses decreasing.

In Q4, revenues reached BRL 13.4 billion, up 16% year-over-year. Banking revenues grew 51%, payments revenues grew 9%. The expanded credit portfolio reached BRL 50 billion. Deposits reached BRL 40 billion, growing 13% year-over-year. Total net revenue excluding interchange and card scheme fees increased 12% year-over-year to BRL 3.5 billion. Non-GAAP net income was BRL 678 million, 7.4% higher year-over-year.

2026 guidance includes a credit portfolio growth range of 25% to 35%, a gross profit growth outlook of 6% to 9%, diluted non-GAAP EPS expected to be in the range of 9% to 13%, and capital expenditure expected to be in the range of BRL 1.8 billion to BRL 2.0 billion. The full delivery of 2025 guidance gives confidence in 2026 perspectives.

Macro volatility, sharp increase in Brazilian interest rates in 2025, competition, and the impact of the regulatory tax framework on the capital structure.

Q: Mario Pierry asked about the gross profit guidance of 6% to 9% despite TPV growth.

A: Gustavo Sechin said it's due to macro uncertainty and the ramping up of the credit business consuming higher provisions.

Q: Guilherme Grespan asked about TPV recovery and EPS guidance.

A: Gustavo Sechin clarified that EPS guidance is not considering the share count from buyback, and Carlos Mauad talked about TPV recovery with operational enhancements.

Q: Arnon Shirazi asked about the NPL increase and CapEx.

A: Carlos Mauad said the NPL increase was due to a regulatory milestone and unsecured products, and CapEx reduction was due to reverse logistics and tap on phone.

Q: Kaio Prato asked about EPS and share-based compensation.

A: Gustavo Sechin said EPS is based on non-GAAP net income, and there's no acceleration in the share base.

Q: Tito Labarta asked about capital return.

A: Gustavo Sechin said they are using buyback and dividend tools, and the third buyback program is open.

Q: Daniel Vaz asked about the credit portfolio guidance and macro assumptions.

A: Carlos Mauad said the guidance includes macro uncertainty, and Ricardo da Silva talked about cohort stacking.

Q: Thiago Paura asked about TPV growth drivers.

A: Carlos Mauad said the focus is on SMBs, and Ricardo da Silva talked about the unique product combination.

Q: Neha Agarwala asked about TPV sustainability and tax rate.

A: Gustavo Sechin talked about the customer acquisition strategy, and Ricardo da Silva and Gustavo Sechin talked about tax rate expectations.