Loading...
01/11 03:37
Loading...
Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
The earnings call summary reveals strong financial performance with significant growth in client assets, net new money, and life insurance premiums. The share buyback program and expected revenue growth provide additional positive sentiment. Despite a 30% decrease in issuer services revenue, other segments like corporate revenues grew. The Q&A session reinforced management's confidence in achieving targets, with a focus on strategic investments and maintaining a strong capital position. Overall, these factors suggest a positive stock price movement, with the potential for increased dividends and buybacks further supporting this outlook.
Client Assets (AUM and AUA) BRL 1.9 trillion, a 17% growth year-over-year. Growth attributed to continuous efforts in evolving client journey experience and product offerings.
Active Clients 4.7 million clients, a 2% growth year-over-year. Growth attributed to efforts in client engagement and retention.
Gross Revenues BRL 4.7 billion, a 4% growth year-over-year. Growth driven by retail participation and fixed income products.
EBT (Earnings Before Taxes) BRL 1.3 billion, a 5% decrease year-over-year. Decrease due to positive impacts from overhead in the previous year, making this quarter not like-for-like.
Net Income BRL 1.321 billion, an 18% growth year-over-year. Growth attributed to higher profitability and operational efficiency.
Return on Equity (ROE) 24.4%, a 223 basis points expansion year-over-year. Growth driven by consistent profitability improvements.
Diluted EPS 22% growth year-over-year. Growth driven by share buyback program execution.
Retail Revenue BRL 3.6 billion, a 9% growth year-over-year. Growth driven by fixed income and retail new verticals such as global accounts and consortium.
Life Insurance Written Premiums 45% growth year-over-year. Growth attributed to early-stage penetration and high potential for expansion.
Retirement Plans Client Assets BRL 86 billion, a 15% growth year-over-year. Growth driven by sales force expansion and market penetration.
New Products Revenue (FX, Global Investments, Digital Account, Consortium) BRL 256 million, a 146% growth year-over-year. Growth attributed to traction in new product offerings.
Credit Card TPV BRL 12.4 billion, an 8% growth year-over-year. Growth attributed to new product launches targeting affluent and private banking clients.
Issuer Services Revenue BRL 268 million, a 30% decrease year-over-year. Decrease due to tough comparison with all-time high revenues in 2Q '24.
Corporate Revenues BRL 279 million, a 14% growth year-over-year. Growth supported by capacity to offer different solutions, mainly derivatives.
SG&A Expenses BRL 1.56 billion, a 10% growth year-over-year. Increase due to higher marketing and technology investments.
Net Margin 29.7%, a 320 basis points expansion year-over-year. Growth driven by higher secondary market activity and operational efficiency.
New verticals launched: XP launched new verticals to strengthen its investment portfolio, including banking, insurance, retirement plans, global account, FX, and consortium.
New products for affluent and private banking clients: New products were launched targeting affluent and private banking clients, with expectations for accelerated growth in credit card offerings.
Consortium growth: The consortium product, launched from scratch, is gaining traction and contributed to a 146% year-over-year revenue growth in new products.
Retail net new money: Retail net new money reached BRL 16 billion, while corporate and institutional net new money was negative at BRL -6 billion due to macroeconomic factors.
Market leadership in broker-dealer: XP became the leader in the local broker-dealer industry with a 17% market share.
Profitability and efficiency: Achieved a record net income of BRL 1.321 billion, an 18% year-over-year growth, and improved efficiency ratio by 161 basis points year-over-year.
SG&A expenses: SG&A expenses grew 10% year-over-year, driven by marketing and technology investments, while maintaining operational cost discipline.
Fee-based model expansion: XP is prepared to expand its fee-based model, which currently represents 5% of total client assets, aligning with trends in developed markets.
Capital management: XP plans to distribute dividends and execute share buyback programs, targeting over 50% of net income for 2025 and 2026.
Macroeconomic Environment: The current macroeconomic scenario has led to liquidity constraints for companies, resulting in withdrawals of investments to meet credit line reciprocity requirements. This has negatively impacted net new money from corporate and institutional clients.
Investment Banking Origination: The challenging environment has adversely affected investment banking origination activities, leading to lower volumes and revenues in this segment.
Tax Regulation Changes: Potential changes in tax rules could impact currently tax-exempt fixed income instruments, altering the dynamics of debt issuance and potentially reducing corporate clients' appetite for new issuances.
Competitive Pressures: Some players in the market have become more aggressive in pricing, particularly in the GCM segment, which has resulted in lower fees and increased competition.
Retail Net New Money: Lower tax-exempt volumes in GCM have impacted primary offerings allocation, reducing net new money from retail clients.
Operational Costs: Higher expenses in marketing and technology investments have contributed to a 10% increase in SG&A expenses year-over-year, which could pressure margins if revenue growth does not keep pace.
Elections and Volatility: Upcoming elections in Brazil are likely to increase market volatility, potentially reducing corporate clients' appetite for new debt issuances and impacting revenue growth.
Retail net new money: The company aims to achieve retail net new money averaging BRL 20 billion per quarter this year, supported by a better GCM pipeline for the second half of the year, new investment product offerings, and other initiatives.
Fee-based model: The company is prepared to serve clients with a fee-based model, which currently represents 5% of total client assets. This model is expected to grow, following trends observed in developed markets like the U.S., where it accounts for 50% of client assets.
Credit card growth: New products targeting affluent and private banking clients are expected to accelerate credit card growth in the coming years.
Insurance business: Life insurance written premiums posted 45% growth year-over-year. The company expects this business to continue growing at a fast pace due to its significant penetration potential.
Retirement plans: Client assets in retirement plans grew 15% year-over-year, reaching BRL 86 billion. The company plans to expand its sales force to increase its market share, which is currently mid-single digit, and penetrate the addressable market in the coming years.
New products: Products such as FX, global investments, digital accounts, and consortiums grew 146% year-over-year, with revenues reaching BRL 256 million this quarter. The consortium product, in particular, is gaining traction month by month.
Wholesale bank strategy: The company expects a solid pipeline for the next quarter, with opportunities to reaccelerate revenue growth. It plans to maintain its corporate securities book size and anticipates increased debt issuance by companies before potential tax rule changes.
Capital management: The company plans to distribute dividends and execute share buyback programs, with combined volumes above 50% of net income for 2025 and 2026. A share buyback program of BRL 1 billion is to be executed by next year, with potential new announcements based on the Board of Directors' decisions.
Dividend Distribution Plan: The company plans to distribute dividends as part of its capital management strategy. Combined with the share buyback program, the total distribution volume is expected to exceed 50% of net income for 2025 and 2026.
Share Buyback Program: The company has an ongoing share buyback program worth BRL 1 billion, which is set to be executed until next year. This program has contributed to a 22% year-over-year growth in diluted EPS, outpacing the 18% growth in net income.
The earnings call highlights strong growth in retail net new money, credit card, and insurance sectors, along with a robust shareholder return plan. The Q&A reveals management's optimism about Q4 performance and future guidance, despite some uncertainties in fixed income and expenses. The planned share buyback and dividend distribution further enhance the positive outlook, suggesting a potential stock price increase of 2% to 8% over the next two weeks.
The earnings call summary reveals strong financial performance with significant growth in client assets, net new money, and life insurance premiums. The share buyback program and expected revenue growth provide additional positive sentiment. Despite a 30% decrease in issuer services revenue, other segments like corporate revenues grew. The Q&A session reinforced management's confidence in achieving targets, with a focus on strategic investments and maintaining a strong capital position. Overall, these factors suggest a positive stock price movement, with the potential for increased dividends and buybacks further supporting this outlook.
The earnings call summary presents strong financial performance, with record high net income and robust growth in client assets and net new money. The new share buyback program further supports a positive outlook. Despite some regulatory and competitive risks, the optimistic guidance on ROE and capital generation, along with the management's commitment to efficiency, indicates a positive sentiment. The Q&A section revealed no major concerns, and management's cautious optimism about future performance supports a positive stock price reaction.
The company's financial performance is strong with record net income and significant growth across multiple metrics. The share buyback program and capital distribution plan are positive for shareholder returns. Despite some competitive pressures and economic challenges, management remains optimistic about future growth and efficiency. The Q&A revealed confidence in revenue growth and ROE improvement. Overall, the positive financial metrics and shareholder-focused strategies outweigh the concerns, leading to a positive sentiment.
All transcripts are sourced directly from the official live webcast or the company’s official investor relations website. We use the exact words spoken during the call with no paraphrasing of the core discussion.
Full verbatim transcripts are typically published within 4–12 hours after the call ends. Same-day availability is guaranteed for all S&P 500 and most mid-cap companies.
No material content is ever changed or summarized in the “Full Transcript” section. We only correct obvious spoken typos (e.g., “um”, “ah”, repeated 10 times”, or clear misspoken ticker symbols) and add speaker names/titles for readability. Every substantive sentence remains 100% as spoken.
When audio quality is poor or multiple speakers talk over each other, we mark the section instead of guessing. This ensures complete accuracy rather than introducing potential errors.
They are generated by a specialized financial-language model trained exclusively on 15+ years of earnings transcripts. The model extracts financial figures, guidance, and tone with 97%+ accuracy and is regularly validated against human analysts. The full raw transcript always remains available for verification.
