PAGS

Interested in PagSeguro Digital Ltd.? Here are five stocks we like better. PagSeguro maintained its full-year targets despite Brazil’s challenging macroeconomic environment. Q2 payment volume rose 3% year over year to BRL 133 billion, while recurring non-GAAP net income increased 2% to BRL 576 million. Customer engagement and credit growth accelerated: cash-active banking clients increased 27% to 5.7 million, and the credit portfolio expanded 31% to BRL 5.1 billion. Nonperforming loans over 90 days were 3.4%, below the 6.2% market average cited by management. Funding efficiency and shareholder returns remained priorities. Deposits grew 15% to nearly BRL 43 billion, funding costs declined for the ninth consecutive quarter, and the company returned about BRL 2 billion to shareholders over the past year through dividends and buybacks. PagSeguro Digital (NYSE:PAGS) reported second-quarter results marked by continued growth in banking engagement, credit balances and deposits, while management said it maintained its full-year targets despite a more challenging macroeconomic environment and elevated interest rates in Brazil. Total payment volume reached BRL 133 billion, up 3% from a year earlier, which Principal Executive Officer Ricardo Dutra said reinforced a gradual reacceleration trend. Net revenue and income excluding interchange fees totaled BRL 3.4 billion, up 2% year over year and 1% sequentially. Recurring non-GAAP net income rose 2% to BRL 576 million, while diluted non-GAAP earnings per share increased 10% to BRL 2.06. → Applied Materials Beat Everything but Wall Street’s Expectations for Margins “We continued to increase client engagement while expanding our multi-product ecosystem across payments, banking and credit,” Dutra said, adding that the company’s profitability remained resilient despite a difficult macroeconomic backdrop. Chief Executive Officer Carlos Mauad said PagBank continued to deepen its relationship with active customers through payments, banking and credit offerings. Cash-in volumes excluding acquiring-related inflows rose 23% year over year and 19% from the first quarter to nearly BRL 100 billion. → Texas Roadhouse and Brinker International Have the Recipe Rivals Are Missing Cash-active banking clients reached 5.7 million, an increase of 27% from the prior-year period. Bill payments and Pix transactions increased 12% year over year. Investment penetration among active clients increased to 28% from 23%, while insurance penetration rose to 16% from 11%. Credit-product penetration, excluding payroll clients, increased from 4% to 6%. Mauad said the broader adoption of financial products supports engagement, monetization and customer lifetime value. → AirJoule Technologies: Short Squeeze Setup Amid Rising Risks The company also highlighted product launches and planned rollouts, including Minizinha Voz, a payment terminal with an AI-powered sales assistant; cashback on international credit card transactions; private payroll loans; Pix Finance, an installment-payment solution; zero-fee investments; pension plans; collections-management tools; and insurance products. PagBank’s total credit portfolio reached BRL 5.1 billion, up 31% year over year. The company said growth was driven primarily by working-capital loans and credit cards. Working-capital balances grew 204% to BRL 600 million, while credit-card balances rose 35% to BRL 1.1 billion. Payroll loans and other credit products totaled BRL 3.4 billion, up 18%. Including financial operations linked to merchant prepayments, PagBank’s expanded credit portfolio was BRL 52.4 billion, up 9% year over year and 3% sequentially. Nonperforming loans more than 90 days past due stood at 3.4%, below the 6.2% Brazilian market average cited by management. Mauad said the company remains confident in its long-term credit strategy, even as macroeconomic conditions have become tougher than anticipated earlier in the year. Management said working-capital origination slowed during the second quarter because PagBank deployed a new credit model and waited to assess its initial loan cohorts. July production subsequently reached about BRL 80 million, above the second-quarter average and prior-quarter averages. The company said it had also begun originating private payroll loans outside its economic group, starting with higher-credit-quality borrowers. PagBank said it was not seeing deterioration across its credit products and did not identify a major impact from Brazil’s second Desenrola debt-renegotiation program. Total deposits reached nearly BRL 43 billion, up 15% from a year earlier, while total funding rose 10% to BRL 47 billion. More than 90% of deposits were generated on the company’s platform, according to management. Chief Financial Officer Gustavo Sechin said PagBank recorded its ninth consecutive quarter of funding-cost reductions as a percentage of CDI. Financial costs declined 5% from the first quarter, despite still-elevated Selic rates. He said the company expects more favorable comparisons in financial expenses during the second half, although its prior assumption for year-end Selic of about 12.5% is now closer to a range of 13.75% to 14%. Gross profit was approximately BRL 2 billion, up 3% year over year and 6% sequentially. Total losses increased 9% year over year, reflecting the expansion and changing mix of the credit portfolio. Operating expenses represented 25.9% of revenue and income excluding interchange fees. Management said it is pursuing additional efficiency through process redesign, automation, AI applications in customer service and back-office functions, and improved management of point-of-sale terminals. Sechin said the company aims to grow expenses below revenue growth, or at least below inflation, rather than forecasting an absolute expense reduction. PagBank’s annualized non-GAAP return on equity was 15.6%, up 30 basis points year over year. Its adjusted Basel ratio declined to 22.5% from 24.1% in the first quarter, moving closer to its long-term target range of 18% to 22%. Over the past 12 months, the company returned about BRL 2 billion to shareholders through dividends and buybacks. PagBank completed its third repurchase program during the first half, repurchasing more than BRL 307 million of shares. A third dividend tranche of $0.28 per common share is scheduled for payment on Sept. 30 to shareholders of record on Sept. 16. Sechin said the company currently favors dividends as a more predictable capital-return tool, while noting that buybacks could still be used in the future. Management said its 2026 EPS outlook does not assume additional repurchases this year. PagBank also announced the appointment of Enrique Fragata as chief operating officer. Mauad said Fragata’s experience in financial services would support the company’s focus on execution, efficiency and operational excellence. PagSeguro Digital Ltd. is a Brazil-based financial technology company that specializes in digital payment solutions for merchants and consumers. Through its online platform and a suite of physical point-of-sale devices, the company enables businesses of all sizes to accept credit and debit cards, process e-commerce transactions, and manage payments via QR codes and digital wallets. In addition to payment acceptance, PagSeguro offers prepaid accounts, funds transfers, and working-capital credit lines designed to support small and medium-sized enterprises. The company's product portfolio includes portable card readers, countertop terminals, and mobile point-of-sale devices that connect via Bluetooth or cellular networks. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "PagSeguro Digital Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Management attributed the 3% year-over-year TPV growth to a gradual reacceleration trend, supported by a broader financial services platform that has evolved beyond a payment-led ecosystem. The 31% year-over-year increase in the credit portfolio was primarily driven by the expansion of working capital and credit card offerings, which management views as central to their long-term monetization strategy. Banking engagement is deepening, evidenced by cash-in volumes reaching almost BRL 100 billion, a 23% year-over-year increase, which provides a low-cost funding foundation for credit growth. Management highlighted that 90% of total deposits are generated on-platform, reinforcing the strength of the digital ecosystem and providing nine consecutive quarters of funding cost reduction relative to the CDI. Operational discipline and financial cost efficiency were cited as key factors in protecting profitability despite a challenging macro environment with interest rates remaining higher than initially expected. The company is leveraging AI-powered tools and product innovations, such as the Minizinha Voz terminal and PIX Finance, to increase client lifetime value and cross-sell opportunities. Management maintained their 2026 guidance but acknowledged that performance will likely reach the bottom of the gross profit range due to elevated Selic rate levels and macroeconomic uncertainty. The credit strategy assumes continued rollout of new products like private payroll loans and PIX Finance, with July already showing a stronger run rate of approximately BRL 80 million in credit production. Capital allocation will prioritize dividends over share buybacks to provide a predictable return stream, targeting a Basel ratio between 18% and 22% over time. Future profitability is expected to benefit from easier year-over-year comparisons in financial costs during the second half of 2026, alongside ongoing operational leverage initiatives. Management remains committed to their 2029 strategic ambition, viewing current macro cycles as temporary hurdles that do not fundamentally alter their long-term growth trajectory. The macroeconomic environment, specifically the persistence of high Selic rates, is identified as a primary headwind creating pressure on business performance and financial costs. NPL90 stood at 3.4%, which management emphasized is well below the Brazilian market average of 6.2%, reflecting a prudent risk profile despite the shift toward unsecured products. The company completed a $200 million share buyback program in the first half of 2026, contributing to a 10% increase in diluted non-GAAP EPS through capital optimization. A new COO, Enrique Fragata, was appointed to strengthen focus on execution and operational excellence as the ecosystem continues to scale. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management expressed confidence in long-term goals, noting that their current NPL of 3.4% provides significant comfort to grow sustainably compared to the industry average of 6.2%. They clarified that while macro cycles and regulatory milestones may occur, the mission remains to scale credit through new product workarounds. The slight revenue dilution relative to TPV was attributed to product mix shifts driven by the World Cup and a tough year-over-year comparison following a massive repricing event in 2025. Management is focused on balancing growth with profitability rather than chasing volume at the expense of margins. Credit production has successfully moved outside the internal economic group, with the first few millions in outstanding credit already generated. Initial credit quality was described as 'perfect,' though management noted they started with top-tier clients and are still testing certain parts of the credit cycle. Dividends are preferred because they offer a more regular and predictable stream for investors compared to the limited effect and lack of predictability seen in recent buyback programs. Management confirmed that current EPS guidance does not contemplate additional buybacks for the remainder of the year.

PagSeguro Digital Ltd. (PAGS) came out with quarterly earnings of $0.41 per share, beating the Zacks Consensus Estimate of $0.4 per share. This compares to earnings of $0.34 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +2.50%. A quarter ago, it was expected that this company would post earnings of $0.4 per share when it actually produced earnings of $0.39, delivering a surprise of -2.5%. Over the last four quarters, the company has surpassed consensus EPS estimates three times. PagSeguro Digital, which belongs to the Zacks Financial Transaction Services industry, posted revenues of $1.01 billion for the quarter ended June 2026, missing the Zacks Consensus Estimate by 4.21%. This compares to year-ago revenues of $892.74 million. The company has not been able to beat consensus revenue estimates over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. PagSeguro Digital shares have lost about 7.8% since the beginning of the year versus the S&P 500's gain of 12.9%. While PagSeguro Digital has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for PagSeguro Digital was unfavorable. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #4 (Sell) for the stock. So, the shares are expected to underperform the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.41 on $1.06 billion in revenues for the coming quarter and $1.69 on $4.25 billion in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Financial Transaction Services is currently in the bottom 36% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. Klarna (KLAR), another stock in the same industry, has yet to report results for the quarter ended June 2026. The results are expected to be released on August 18. This Swedish buy now, pay later company is expected to post quarterly loss of $0.07 per share in its upcoming report, which represents a year-over-year change of +50%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. Klarna's revenues are expected to be $987.94 million, up 20% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report PagSeguro Digital Ltd. (PAGS) : Free Stock Analysis Report Klarna Group plc (KLAR) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Nayax (NYAX) came out with quarterly earnings of $0.14 per share, beating the Zacks Consensus Estimate of $0.09 per share. This compares to earnings of $0.16 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +55.56%. A quarter ago, it was expected that this financial technology company would post earnings of $0.08 per share when it actually produced earnings of $0.03, delivering a surprise of -62.5%. Over the last four quarters, the company has surpassed consensus EPS estimates two times. Nayax, which belongs to the Zacks Financial Transaction Services industry, posted revenues of $122.59 million for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 1.70%. This compares to year-ago revenues of $95.59 million. The company has topped consensus revenue estimates two times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Nayax shares have added about 36.5% since the beginning of the year versus the S&P 500's gain of 13.3%. While Nayax has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Nayax was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.24 on $134.9 million in revenues for the coming quarter and $0.73 on $515.05 million in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Financial Transaction Services is currently in the bottom 38% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. One other stock from the same industry, PagSeguro Digital Ltd. (PAGS), is yet to report results for the quarter ended June 2026. This company is expected to post quarterly earnings of $0.40 per share in its upcoming report, which represents a year-over-year change of +17.7%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. PagSeguro Digital Ltd.'s revenues are expected to be $1.05 billion, up 17.6% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Nayax Ltd. (NYAX) : Free Stock Analysis Report PagSeguro Digital Ltd. (PAGS) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

PagSeguro Digital Ltd. (PAGS) is expected to deliver a year-over-year increase in earnings on higher revenues when it reports results for the quarter ended June 2026. This widely-known consensus outlook gives a good sense of the company's earnings picture, but how the actual results compare to these estimates is a powerful factor that could impact its near-term stock price. The stock might move higher if these key numbers top expectations in the upcoming earnings report. On the other hand, if they miss, the stock may move lower. While management's discussion of business conditions on the earnings call will mostly determine the sustainability of the immediate price change and future earnings expectations, it's worth having a handicapping insight into the odds of a positive EPS surprise. This company is expected to post quarterly earnings of $0.40 per share in its upcoming report, which represents a year-over-year change of +17.7%. Revenues are expected to be $1.05 billion, up 17.6% from the year-ago quarter. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. This is essentially a reflection of how the covering analysts have collectively reassessed their initial estimates over this period. Investors should keep in mind that the direction of estimate revisions by each of the covering analysts may not always get reflected in the aggregate change. Price, Consensus and EPS Surprise Estimate revisions ahead of a company's earnings release offer clues to the business conditions for the period whose results are coming out. Our proprietary surprise prediction model -- the Zacks Earnings ESP (Expected Surprise Prediction) -- has this insight at its core. The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a more recent version of the Zacks Consensus EPS estimate. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier. Thus, a positive or negative Earnings ESP reading theoretically indicates the likely deviation of the actual earnings from the consensus estimate. However, the model's predictive power is significant for positive ESP readings only. A positive Earnings ESP is a strong predictor of an earnings beat, particularly when combined with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). Our research shows that stocks with this combination produce a positive surprise nearly 70% of the time, and a solid Zacks Rank actually increases the predictive power of Earnings ESP. Please note that a negative Earnings ESP reading is not indicative of an earnings miss. Our research shows that it is difficult to predict an earnings beat with any degree of confidence for stocks with negative Earnings ESP readings and/or Zacks Rank of 4 (Sell) or 5 (Strong Sell). For PagSeguro Digital, the Most Accurate Estimate is higher than the Zacks Consensus Estimate, suggesting that analysts have recently become bullish on the company's earnings prospects. This has resulted in an Earnings ESP of +1.86%. On the other hand, the stock currently carries a Zacks Rank of #4. So, this combination makes it difficult to conclusively predict that PagSeguro Digital will beat the consensus EPS estimate. Analysts often consider to what extent a company has been able to match consensus estimates in the past while calculating their estimates for its future earnings. So, it's worth taking a look at the surprise history for gauging its influence on the upcoming number. For the last reported quarter, it was expected that PagSeguro Digital would post earnings of $0.4 per share when it actually produced earnings of $0.39, delivering a surprise of -2.50%. Over the last four quarters, the company has beaten consensus EPS estimates three times. An earnings beat or miss may not be the sole basis for a stock moving higher or lower. Many stocks end up losing ground despite an earnings beat due to other factors that disappoint investors. Similarly, unforeseen catalysts help a number of stocks gain despite an earnings miss. That said, betting on stocks that are expected to beat earnings expectations does increase the odds of success. This is why it's worth checking a company's Earnings ESP and Zacks Rank ahead of its quarterly release. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported. PagSeguro Digital doesn't appear a compelling earnings-beat candidate. However, investors should pay attention to other factors too for betting on this stock or staying away from it ahead of its earnings release. Among the stocks in the Zacks Financial Transaction Services industry, Nayax (NYAX), is soon expected to post earnings of $0.09 per share for the quarter ended June 2026. This estimate indicates a year-over-year change of -43.8%. This quarter's revenue is expected to be $120.54 million, up 26.1% from the year-ago quarter. The consensus EPS estimate for Nayax has been revised 1.4% higher over the last 30 days to the current level. However, a higher Most Accurate Estimate has resulted in an Earnings ESP of +7.14%. This Earnings ESP, combined with its Zacks Rank #3 (Hold), suggests that Nayax will most likely beat the consensus EPS estimate. Over the last four quarters, the company surpassed consensus EPS estimates two times. Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report PagSeguro Digital Ltd. (PAGS) : Free Stock Analysis Report Nayax Ltd. (NYAX) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Remitly Global, Inc. (RELY) came out with quarterly earnings of $1.07 per share, beating the Zacks Consensus Estimate of $0.29 per share. This compares to earnings of $0.04 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +268.97%. A quarter ago, it was expected that this company would post earnings of $0.12 per share when it actually produced earnings of $0.23, delivering a surprise of +91.67%. Over the last four quarters, the company has surpassed consensus EPS estimates four times. Remitly Global, which belongs to the Zacks Financial Transaction Services industry, posted revenues of $495.16 million for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 2.19%. This compares to year-ago revenues of $411.85 million. The company has topped consensus revenue estimates four times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Remitly Global shares have added about 78.5% since the beginning of the year versus the S&P 500's gain of 13%. While Remitly Global has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Remitly Global was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.30 on $502.62 million in revenues for the coming quarter and $1.38 on $1.97 billion in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Financial Transaction Services is currently in the bottom 37% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. Another stock from the same industry, PagSeguro Digital Ltd. (PAGS), has yet to report results for the quarter ended June 2026. This company is expected to post quarterly earnings of $0.40 per share in its upcoming report, which represents a year-over-year change of +17.7%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. PagSeguro Digital Ltd.'s revenues are expected to be $1.05 billion, up 17.6% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Remitly Global, Inc. (RELY) : Free Stock Analysis Report PagSeguro Digital Ltd. (PAGS) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Evertec (EVTC) came out with quarterly earnings of $1.05 per share, beating the Zacks Consensus Estimate of $0.95 per share. This compares to earnings of $0.89 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +10.53%. A quarter ago, it was expected that this payment processing company would post earnings of $0.91 per share when it actually produced earnings of $0.9, delivering a surprise of -1.1%. Over the last four quarters, the company has surpassed consensus EPS estimates three times. Evertec, which belongs to the Zacks Financial Transaction Services industry, posted revenues of $274.82 million for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 4.12%. This compares to year-ago revenues of $229.61 million. The company has topped consensus revenue estimates three times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Evertec shares have added about 6.9% since the beginning of the year versus the S&P 500's gain of 11%. While Evertec has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Evertec was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.97 on $271.94 million in revenues for the coming quarter and $3.93 on $1.08 billion in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Financial Transaction Services is currently in the bottom 38% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. PagSeguro Digital Ltd. (PAGS), another stock in the same industry, has yet to report results for the quarter ended June 2026. This company is expected to post quarterly earnings of $0.40 per share in its upcoming report, which represents a year-over-year change of +17.7%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. PagSeguro Digital Ltd.'s revenues are expected to be $1.05 billion, up 17.6% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Evertec, Inc. (EVTC) : Free Stock Analysis Report PagSeguro Digital Ltd. (PAGS) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Image source: The Motley Fool. Tuesday, May 12, 2026 at 6 p.m. ET Chief Executive Officer — Ricardo da Silva Chief Executive Officer, PagBank — Carlos Mauad Chief Financial and Investor Relations Officer — Gustavo Bahia Sechin Ricardo da Silva: Good evening, everyone, and thank you for joining our first quarter 2026 earnings call. Starting on Slide 4, we summarize the main highlights of the quarter. This first quarter marks continued progress in the execution of our strategy with banking and credit acceleration and operating leverage translated into earnings expansion, even in a challenging macroeconomic and a high interest rate environment. Total payment volume reached BRL 128 billion, flat year-over-year, confirming a gradual reacceleration versus prior quarters. Our credit portfolio expanded to BRL 51 billion, up 11% year-over-year, driven mainly by a 36% increase in total loans. Growth was broad-based across all products with particular strength in working capital, which rose 190% year-over-year. Supporting this expansion, deposits reached BRL 42 billion in Q1, a 23% year-over-year increase. On the financial highlights, net revenue, excluding interchange fees, reached BRL 3.3 billion, 6.4% growth year-over-year, reflecting mainly credit acceleration and the overall banking performance. Recurring net income, non-GAAP reached BRL 575 million, a 4% increase, mainly impacted by the increase in financial expenses linked with the base interest rate of Brazil, but with positive impact from the operating leverage we delivered, which we'll see later in the presentation. Most importantly, diluted non-GAAP EPS increased 12% year-over-year, boosted by the capital optimization initiatives deployed. On the next slide, we highlight our long-term track record of consistent shareholder value creation, supported by a focus on profitability, disciplined growth and capital efficiency. Over the last 12 months, the company returned approximately BRL 2.4 billion to shareholders through dividends and share buybacks, translated into the last 12 months total yield of around 16%. Since our IPO in 2018, we have delivered GAAP diluted EPS growth of nearly 16% CAGR, underscoring a strong and consistent execution track record through multiple cycles, including periods of significant global disruption and macro volatility. Over this period, we have accomplished key strategic milestones that expanded our addressable market, improved the profitability and established a robust platform for sustainable earnings growth. With that, I will now turn it over to Carlos Mauad. Carlos Mauad: Thank you, Dutra, and good evening, everyone. In this section, we will take a look at the operational and commercial performance of our business units. Let me start on Slide 7, where we highlight our main growth opportunities. Here, we provide an overview of our ecosystem and the growth opportunities ahead. PagBank operates a fully integrated payment, banking and credit platform, serving individuals and micro, small and medium-sized businesses. The breadth of our platform supports strong engagement, cross-selling potential and large addressable market across payments, deposits, credit and financial services. As shown in the slide, there are significant opportunities for expansion as we explore new verticals. In several segments of our banking operations, our market share is currently below 1%, underscoring our confidence that we are still at the very early stage of our growth trajectory. This progress should be achieved through enhanced cross-selling and developing a broader and more diversified credit portfolio, all overseen with prudent management and a long-term perspective. On the next slide, we highlight some key metrics of the banking operation and our customer-centric approach, demonstrated by the increasing transactionality and engagement of our ecosystem. Cash-in volumes, excluding acquiring-related inflows reached BRL 81 billion, representing an 11% growth year-over-year with cash-in per active client growing 12% in the same period. This performance reflects stronger client engagement as demonstrated by the increased usage of our platform, higher volumes of bill payments and PIX transactions as well as an important increase in the penetration of our investment and insurance products across the active client base, signaling deeper relationships and improved monetization of our clients' transactionality. Collectively, these trends highlight how robust and complete our ecosystem is and the rising levels of customer engagements that we are achieving throughout our client base. On the next slide, let me turn to our credit portfolio evolution. Credit is not only our growth frontier, but also a strategic lever of engagement across our ecosystem. Total credit reached BRL 5 billion at the end of the quarter, growing 36% year-over-year, positioning us at the growth pace above the expected guidance for the year. When we include financial operations linked to merchant prepayment, we can see increased penetration of our instant settlement feature. Expanded credit portfolio totaled BRL 51 billion this quarter, 11% growth over the last 12 months despite stable volumes on acquiring. As it should be, growth remains broad-based across products with an important expansion in every channel, but clearly led by working capital loans, the main driver for credit portfolio this year, which expanded 191% year-over-year. Working capital already accounts for 10% of our total portfolio. Importantly, asset quality remains controlled with NPL indicators well below the Brazil banking system average. The growth trajectory reflects the evolution of our mix from a mostly secured to a more balanced portfolio as we gradually accelerate underwriting for unsecured products. On the next slide, I show you our funding structure and how we generate efficiency from a financial cost perspective. Total deposits reached BRL 42 billion, a 23% increase compared to last year with more than 90% sourced from our own platform, a clear example of how strong our ecosystem is and the increasing level of engagement that we get from our active client base and the relevance of our digital channels. When including other sources of funding such as related party deposits and borrowings, total funding reached almost BRL 47 billion in the period, 15% increase year-over-year. More importantly, our deposits APY reduced for the eighth straight quarter, a continuous 2-year trajectory of reducing funding cost as a percentage of the CDI. In the first quarter 2026, deposit APY reached 83.9% with a highlight to the average remuneration of our demand deposit, the checking account balance is below 4% (sic) [ 40% ] at 38.6%, a strong 10 points reduction year-over-year. Finally, as shown on the right side of the slide, our loan-to-fund ratio keeps improving from 114% last year to 109% this quarter as we continue to grow credit with caution and prioritize a well-balanced structure. Now I will hand it over to Gustavo to walk you through the financial highlights of the quarter. Gustavo, please. Gustavo Bahia Sechin: Thanks, Mauad. Hello, everyone, and thank you for joining us today. Let's focus now on our consolidated financial results. Starting on the next slide, we take a look at our revenue and gross profit. Total revenue and income, excluding interchange fees, reached BRL 3.3 billion this quarter, as you can see, growing 6.4% year-over-year, driven primarily by the banking and credit business expansion. Banking revenues grew 41% in the same period supported by credit expansion and the higher transactionality from our client base, leading to better fee generation. Gross profit totaled BRL 1.9 billion, up almost 1% year-over-year, with banking representing now approximately 31% of the total gross profit. As we had anticipated, 2026 has been proving to be a challenging year. In the first quarter, we still face significant pressure from rising financial costs, primarily reflecting the impact of the higher Brazilian basic interest rate. Starting in the second quarter, we expect this effect to be driven by additional cuts in the benchmark interest rate. Turning to the next slide, we detail our P&L and the cost dynamics for the quarter. As mentioned earlier, financial costs increased year-over-year due to the higher SELIC rate, which rose 1.9 points over the period. This effect was partially mitigated by the initiatives to reduce our funding costs, driving down our APY on deposits by 6.2 points year-over-year. Sequentially, financial costs decreased 2.6%, reflecting those initiatives. Total losses, which includes chargebacks from acquiring and expected credit loss provisions from the credit operation expanded [ 29% ] year-over-year, mainly reflecting the change in our credit portfolio mix and its overall expansion. Looking specifically at the acquiring side of the ecosystem, chargebacks decreased 15% year-over-year, capturing the improvements in our fraud prevention efforts. But the main highlight this quarter is our consistent ability to generate operational leverage. As you can see, our operational expenses declined as a percentage of revenue, improving by approximately 230 basis points year-over-year, demonstrating not only our cost discipline, but also how we keep exploring opportunities to improve efficiency, operating under a leaner structure and supported by the use of AI in core fronts such as client service. Looking ahead, we expect to keep driving this efficiency as operational leverage is a core pillar of value creation embedded in our full year guidance and long-term ambition. Moving on to the next slide. Our non-GAAP net income reached BRL 575 million in the quarter, representing 4% growth year-over-year. As a result, our EPS diluted increased 12%, supported by earnings growth, operating leverage and the reduction in the average share outstanding linked to the buyback execution in the quarter. On the right side of the slide, you can see that our return on average equity reached 15.8% this quarter, up roughly 80 basis points year-over-year. This represents another consecutive quarter of improvement driven by higher profitability and the initiatives we have deployed to strengthen capital efficiency as detailed on the next slide. Now moving on to the next slide. Let's focus on the initiatives that drive shareholder value and improve our capital structure. We keep advancing in our objective to improve our capital structure, pursuing a Basel index level between 18% to 22% in the next coming years. As a result, in the last 12 months, we have returned more than BRL 2.4 billion to shareholders through dividends and buybacks. As mentioned in previous calls, we believe it is important to use both tools to improve our capital structures as dividends offer stability and predictability, while buybacks provide tactical flexibility. In that sense, next June, we shall distribute an additional BRL 400 million in dividends, USD 0.26 per common share, in line with our commitment to distribute at least BRL 1.4 billion in dividend this year. As for our core equity Tier 1, given the initiatives deployed, our managerial base ratio stood at 24.1%, a more than 4-points decrease compared to last quarter, provide ample capacity to support continued credit expansion and shareholder return. Now moving to the next slide, let me update you on our guidance for 2026. As you know, this year, we aligned on our guidance with our 2029 ambition, reinforcing our commitment to the long-term strategy we are executing. Starting by credit portfolio, we ended the first quarter above the expected range, and we expect to keep delivering consistent growth throughout the year. Looking to the gross profit, the limited expansion we saw in the first quarter reflects the financial cost pressure driven by the higher SELIC rate. As we move into the second quarter and beyond, we expect these headwinds to fade, allowing our revenue growth initiatives and efficiency gains in financial expense to position gross profit growth squarely within our guidance range. As for shareholder value creation, we delivered a diluted non-GAAP earnings per share 12% higher than last year, positioning it close to the top of the expected range of the year, aligned with our road map of initiatives and operational efficiency we are driving across the company. And finally, while CapEx deployment naturally varies across quarters, the important point is that we are focused on delivering full year CapEx within our commitment. In summary, even in the face of macro and geopolitical headwinds, we executed effectively and delivered a solid and consistent quarter, positioning us well for our full year guidance. I will now turn the call back to Mauad for his final comments. Carlos Mauad: Thank you, Gustavo. Before we conclude, let's move to the next slide for a few closing remarks. We keep building momentum across our core growth engines. On top of the acquiring volumes reaccelerating, credit portfolio is scaling as planned at a robust pace, guided by disciplined risk management and prudent underwriting standards. This approach ensures the quality of our assets in a dynamic market environment. Additionally, our ongoing focus on operating efficiencies supported by AI helps us to navigate the macro scenario and maintain resilience in our earnings. Through rigorous cost management and the optimization of our process, we are able to adapt quickly, capture new opportunities and reinforce our financial stability. Looking ahead, with the gradual easing of the interest rate cycle, we anticipate a more favorable environment that should support increased lending activity and stimulate growth. We are confident to achieve our 2026 guidance, which outlines our commitment for growth, profitability and shareholder value as seen in the previous slide, supported by key strategic initiatives, which have been maturing steadily in the past quarters. Furthermore, as we advance towards the ambitious targets we shared with you for 2029, our focus remains on operational excellence, disciplined expansion and consistent value creation for all stakeholders. Thank you for your trust and partnership as we move forward together. Operator: Our first question comes from Kaio Prato with UBS. Kaio Penso Da Prato: I have 2, please. First, on the payment business. What can we expect in terms of the TPV growth going forward? We saw again better trends sequentially if we look year-on-year, but it is still contracted. So just wondering if we should expect this turning positive in the next quarter? And how do you see the competitive landscape? So this is the first. And then on the guidance, what should be the drivers for this acceleration on the gross profit expected going forward? So if this is mostly related to banking TPV recover or if this is more related to SELIC cuts potentially. So any sense of the relevance of these main KPIs for PAGS would be good going forward. Carlos Mauad: Hello, Kaio. This is Mauad. Thank you for your question. In terms of trends here for TPV growth, as we have been mentioning since third quarter of last year, the trend is to recover growth year-over-year. So we pretty much had minus 5% on the third quarter last year, something around minus 2% on the fourth quarter. Here, we are virtually flat on the first quarter. So the expectation is to be above the water line on the second quarter of this year and also on the second half with a higher acceleration. So again, this doesn't change the message that we sent to you guys on the call that we made to release the third quarter results of last year. To answer you about the gross profit trends, I'm going to pass the floor here to Gustavo. Gustavo Bahia Sechin: Hi, Kaio. How are you? Gustavo here. So try to answer your question related to the gross profit. I think that it's a mix. First, we could expect an expansion in our operation, both in payment and also in banking. It's important to remember that we -- as we have been talking, we are -- we passed the worst part of the cycle in the payment business, and we are just in the beginning of our journey of credit. So both will sustain and help the gross profit trend going forward. And additionally, it's important to highlight that we have harder comps in the first half of the year when we consider the pressure in terms of SELIC and the financial cost. So despite that, we were expecting a better trend in terms of SELIC cuts during the year, but we can expect that the second half of the year will be better than what we are seeing in the first Q and also what we expect in the second Q of the quarter -- the year. Operator: Our next question comes from Guilherme Grespan with JPMorgan. Guilherme Grespan: Two questions on my side as well. One is a follow-up on gross profit. Just on specifically the payments gross profit was a little bit a more sharp decline here. I try to calculate the yield like divided gross profit by TPV. The yield declined almost 60, 70 bps. In other words, gross profit was down minus 15 quarter-over-quarter, TPV minus 10. Just wanted to get a sense what is driving this compression of yield, if it's a pricing strategy? Or what is the moving parts behind this? And then the second question is just the decline in yields of the checking accounts. Very nice to see the average remuneration as a percent of CDI declining. Just want to understand if this is an intentional strategy and what we can expect forward or if it was related to calendar days and other effects? Gustavo Bahia Sechin: Hi, Grespan. Good to talk to you. So again, talking about the gross profit. As I said, I think -- and most important, I think that's very important to highlight that we are fully committed to deliver our guidance in terms of gross profit for the full year. And as we said in the beginning, the first half of the year should be more challenging than what we expect for the second half of the year. That's very important. I would say that those metrics that you were talking, I think that's not the best metric to follow the gross profit. Gross profit based on TPV, I would say that doesn't represent the business -- all components of the business that we have. So I would recommend that you use the gross profit and use the guidance as a reference and especially considering that we expect SELIC cuts during this year. And also, it will help to reduce the pressure of the financial costs. That's the main negative portion that are impacting our gross profit. And talking about the deposits, I would say that we are trying to mitigate the financial cost, again, the SELIC, the high SELIC that we are facing in different ways. As we implement -- last year, we implemented a very disciplined repricing policy. And at the same time, we implement some reduction in terms of the remuneration and yields that we paid in our CDs and in our checking accounts. So that's one of the initiatives that we implemented, and we are still identifying different blocks that we could address the pressures in terms of financial costs. So I don't -- I -- in other words, I don't say any pressures related to the seasonality, but I would say that's much more related to the strategic implementation in terms of remunerations. Ricardo da Silva: And when you think about gross profit -- Grespan, when you think about gross profit, when you see this 1% and the guidance is -- the bottom of the guidance is 6%, I would say we have a kind of hard comp here because in Q1 '25, average SELIC was around 13%, and this year was 15%. So it's kind of a hard comp in terms of financial expenses because interest rates started to increase in Brazil after Q1. So we're having this kind of hard comp from 13% SELIC last year versus 15% this year. Guilherme Grespan: That's clear, Dutra and Gustavo. Just a follow-up on the checking account. Does the quarter already reflect all the movements, meaning should rates be more or less what we see or there is still some carry-on effect to happen going forward? Carlos Mauad: There are other changes that we plan for the end of the first quarter. So we do -- we're going to have some reflects moving forward. And there are always some optimization under the product perspective that we are planning here and deploying throughout the year. So again, we should see that as a consistent movement over time, not as a point in time action. Operator: Our next question comes from Tito Labarta with Goldman Sachs. Daer Labarta: Sorry, not to harp on the point, but just going back on the gross profit guidance, and I understand things should improve from here and some of the drivers of that. But when the year started, I guess, expectations were rates would probably go to 12%, 12.5%. Now we're lucky if we get to 13%. So the outlook has changed a little bit. So do you expect any impact from that rates just coming down at a slower pace than initially expected? Could that have any impact on the guidance? And the second part is on the loan growth, right? I know it's early stages. You're showing very good growth, but we are seeing some incremental deterioration for the industry overall. So could that also limit your ability if the credit cycle gets worse? And I know your loan portfolio is much smaller than the system, but just to think there are some headwinds from when we initially started the year. So how do you factor in those headwinds to your ability to deliver on that guidance? Carlos Mauad: Hello, Tito, this is Mauad. Thank you for your question. In terms of the gross profit trend here, that's why when we send the guidance here, we have a range. So we know that in Brazil, there is many moving parts regarding the macro environment. So again, if the curve is not going to close down to 12.50% as we expected in the beginning of the year, we're going to work on the different levers that we have on the P&L to deliver the range of the guidance that we disclosed last call. Moving to your next question. Again, the credit cycle in Brazil is always -- we have to look forward to make sure that we are making the right movements here. But as you mentioned, we are in the very beginning of our credit outstanding evolution. So this is not a concern at this point. So we are scratching the surface. We are testing deeply the clusters in terms of credit that are more resilient to this macro environment. So again, it's not a concern on the short term. But of course, we have -- and we will have more sophisticated through the cycle variable on our models here to make sure that whenever we have a very relevant credit outstanding here, we can go through the cycles without having a material impact in terms of credit performance. Gustavo Bahia Sechin: And Tito, just to complement Mauad here, when we talk about gross profit and also about the loan growth, despite that we are seeing a reduction in terms of rates, much lower than what we were expecting. On the other side, we could see that the unemployment rate has been showing very strong resilience during this period. It helps a lot in terms of consumption and also in terms of transactionality of our customers inside our ecosystem. Daer Labarta: Great, that's very helpful. Maybe just one quick follow-up. Also just factoring in a little bit the competitive environment. I mean we saw ABECS numbers come out recently, showing industry growing around 8% or so. We've seen some of your largest competitors growing well north of 20%. How do you -- how is the competitive environment? Is it changing at all? Does that present any risk at all for you guys? Carlos Mauad: I think that on the SMB landscape, I think that we pretty much have the same competitive environment for the past 24 months, where we have pretty much us, Stone, Mercado Pago and CloudWalk playing at this level. When we see competitors growing like 20%, 25% TPV year-over-year, we are talking about a different cluster of customers here. We're talking about enterprise sub-acquirers. That's a different business than what we are running here. And again, we see the industry growth. We are happy that the industry is growing. And of course, as we have a more stable pricing environment at this point as long as we don't have to input the friction of increasing or repricing the take rates of our customers. So we restart to build vintage after vintage in terms of customer acquisition to make sure that we keep up with the market growth in terms of payments. Gustavo Bahia Sechin: And Tito, if I may add, I think that pricing rationale continue to prevail among the players in the industry. That's very important. And it adds when we consider the rationality in terms of pricing and competition and also when we consider that the industry is still growing in a healthy pace with a growth in terms of TPV and also a very important growth in terms of PIX in the industry above high single -- double digits in the industry. That's very important because it sustain the transactionality, it sustained the principality of the customers inside our ecosystem again. Ricardo da Silva: And Tito, just one more point, not related to this question, but the question that you made about credit, just to remember, it's important to highlight here on Slide 9. Even with this credit cycle changes in Brazil, our NPLs are pretty much stable and almost half of the industry. So still, we have the comfort to keep growing our credit portfolio because we have lower NPLs, almost half of the industry. We have excess of capital in our balance sheet. So we don't see any concerns to hurt our credit portfolio at this point. Operator: Our next question comes from Daniel Vaz with Safra. Daniel Vaz: Congrats on the results. I was looking specifically on your working capital origination in the presentation. You break it down in the quarters, and you have a gray bar for the future, right? Does that imply you're having enough good results and good vintages to increase your origination and working capital? What's the baseline? What's the expected level we should see for the monthly? I guess you were guiding in the past for like BRL 70 million monthly originations in the working capital. Are you comfortable enough to double that? Or any level that you would like to share with us? Carlos Mauad: Hello, Vaz. This is Mauad. Thank you again for your question. Yes, the gray bar kind of give you a soft guidance on what is coming up on the second quarter. So we're still quite confident on keeping growing the working capital origination quarter-over-quarter. Of course, there are many clusters that we are running tests to see where it's going to land in terms of credit performance before we roll out. And also, there are some product enhancements that we are developing at this point that can push another cycle of growth on our credit products here, especially on the working capital where we have a very strong right to it. So again, you're going to see growth quarter-over-quarter. And whenever we see the limits on it, you guys will have the information. Daniel Vaz: Good. And if you can share with us maybe the clusters you're having the most success or any types of maturity or any types of duration that this credit is going to have, it will be very, very good to hear as well. Carlos Mauad: Here, the clusters pretty much as input all the credit products. Here, we work in a range where you have like the best clusters, mainly they do not access credit because they do not have the need and the down part of this credit risk rank doesn't perform. So again, we work in this sweet spot where we have a good conversion, a good yield, and it has the potential to generate credit outstanding. So we are talking -- we are always talking in this range in terms of credit performance in the middle where we can optimize net credit margins. Gustavo Bahia Sechin: And also, Daniel, Gustavo here, I think that's very important to consider that we are focusing on our internal customer base at this point. Operator: Our next question comes from Arnon Shirazi with Citi. Arnon Shirazi: My question is also related to the credit. You reaffirmed the 2029 goal related to credit, have a BRL 25 billion portfolio, but we have been seeing some changes in regulation, including caps. I wonder if this impact growth appetite for the next years and also it should impact the overall results expected until '29. Carlos Mauad: Of course, thank you for your question. So of course, there are many change on regulations, caps, products moving around. But the same way, some opportunities get away, some new opportunities show up so we can build our credit outstanding. So it will be too soon for us to, for example, to anticipate any kind of impact on what was the recent moves on the INSS, the retiree payroll loans. We are also on the very beginning of our pilot here on the private companies' payroll loans that also has a huge potential on our customer database that's going to replace part of the volume that we lost on the FGTS factory receivables. So again, those moving parts is part of the management's problems here to solve it up and to make sure that we can deliver our long-term guidance. Operator: Our next question from Neha Agarwala with HSBC. Neha Agarwala: Good to see improvement in the trends for the TPV. Can you give us a bit more color regarding segmental information? How is the SMB segment doing, which -- MSMB, which is more of a core segment for you? Has that started to pick up again? And how is the competition in particularly that segment given that some of your competitors are trying to put more emphasis on that, adding more -- improving their customer service. So just some color on SMB would be very helpful. And how sustainable is the OpEx improvement that we have seen this quarter? Carlos Mauad: This is Mauad. Thank you for your question, Neha. Here on the SMB landscape, we didn't see like any major change on how those customers are behaving. Of course, we are always optimizing our service to this specific kind of customer, our pricing strategy on acquisition, the way we delivered our banking products to those customers to make sure that we have a very strong profitability coming out of these relationships. So again, we do not try to enter in this fight, only looking at price or the commodity products that the entire industry have, we try to bring our bundle offer here to make sure that we can monetize at the right level these SMBs relationships. So again, I think that we have the best product stack for these specific customers, and we are investing a lot in terms of product evolution to make sure that we deliver the best quality in terms of service provider to those customers. Gustavo Bahia Sechin: Neha, Gustavo here. Let me talk about the OpEx. I would say that we are just in the beginning in terms of the opportunities that we see in terms to continue generating operating leverage. You know that we have been consistently delivering some gains in terms of operating leverage, but I see that huge opportunities inside of the company. So it remains one of the main tools that we are going to work not only in 2026, but also in the long term. I can say that we are seeing opportunities both on nonoperational side and also in terms of customer experience, the use of AI to help us to gain productivity, to help us to gain a more deeper knowledge about our customer and how we can deploy those initiatives through the year. So I would say that we are just in the beginning of what we can generate in terms of operating leverage. Operator: Our next question comes from William Barranjard with Itaú BBA. William Buonsanti Barranjard: I have 2 quick ones. First, going back to credit, right, especially credit quality. Can you give us any color of how credit quality is doing, especially on the non-secured lines? I understand it's a new line, but if everything is going accordingly to what you were expecting, if things deteriorated a little bit lately or not? Just overall, your views here concentrated on the clean lines. And also, this is a very quick one regarding your other financial income, what drove the quarter-on-quarter growth was about 30%. So I just wanted to understand that. Carlos Mauad: Thank you for your question. This is Mauad. On our unsecured products, credit performance is coming at the right level in terms of profitability. The working capital product, it's a high-yield product here. So it's not a product that's going to optimize NPLs. It is a product that's going to optimize net credit margin. So again, nothing coming out of the guardrails that we have on the company's governance. The other unsecured product that you see growing that was on our credit outstanding slide. It is credit cards that grew something like 7% quarter-over-quarter. And in this specific product, as it has a longer payback here, we are being more conservative on the cutoffs on the credit performance. So that's a little bit of color on how we are dealing on managing the credit risk between those 2 main products that we have here on the unsecured line. Gustavo Bahia Sechin: William, Gustavo here. If you're talking about the other financial income, despite that we are seeing that increase on a quarter -- year-over-year perspective, there is no recurring item. I think that's much more related to the seasonality that we are seeing on the float side and then the SELIC rate than something different than that. Operator: Our next question comes from Antonio Ruette with Bank of America. Antonio Gregorin Ruette: So my question goes on the guidance. You are running about -- above or in line with the guidance for 2026. But as you mentioned, you reiterated the guidance -- the long-term guidance. This would imply an acceleration, right, particularly when we're talking about the loan growth. So my question here is, should we expect this acceleration in loan growth already in '27? Are you seeing what you should have been seeing to accelerate the loan growth in '27? And what should be the key lines here? And the same question here goes for the gross profit. Once we are past '26, what should be the main drivers here? Carlos Mauad: Hello, Ruette. This is Mauad. I'm going to pick the first part of your question here. So you're right. We're going to see a pickup in terms of growth in 2027 in credit, and I explain you why. There are 2 main factors here. First, part of the products that we already have on our portfolio here to offer our customers, it is an unsecured product. So due to the macro environment, the high level of interest rates at this point, we don't see the conditions to accelerate more than what we are showing at this point. And there is also a second factor here, which is the product development. Part of our products are not even in production yet. And part of our products are in pilot, as I mentioned here, the payroll loans that we are rolling out here for the employees of the company. And probably by the beginning of the second half of this year, we're going to go to the open market offering that to different employees of different companies. So again, those are the 2 main factors that explain why we will not see a growth higher than what we see on the CAGR for 2029, and we should expect on 2027 and on a higher growth in terms of credit outstanding. I'm going to pass here to Gustavo to answer the gross profit part of the question. Gustavo Bahia Sechin: Hi, Ruette. Gustavo here. Basically, when we consider our gross profit, our guidance in terms of -- long-term guidance in terms of gross profit, the financial cost and also the impact of the levels of SELIC that we have will, and during this year impact negatively in our numbers. But again, as we foresee that the reduction in rates will continue going forward, not only in 2026, but also '27, '28, it will have a positive effect in our gross profit. Remember that when we were before the beginning in terms of monetary tightening that we start back in October -- September, October 2024, we will run in terms of financial cost almost below the size that we were -- at least half what we were running the financial cost right now. So again, as we are seeing the reduction in rates, it will positively impact our gross profit. So that's one effect. And also in terms of growth in terms of credit, we are just in the beginning. So it will mature. It will contribute in terms of cross-sell, not only in terms of the banking, but also in terms of the cross-sell in the payment business by itself. Operator: Our next question comes from Marcelo Mizrahi with Bradesco. Marcelo Mizrahi: Congratulations on the results. My question -- I have 2 questions. So first one is regarding those new initiatives to reduce the cost of the funding of the company. So how big could be or if you can come back to the levels that we are before, reducing the size of the deposits compared to the total funding or now or not? Trying to understand this like a good tailwind to the cost of funding. First question is -- the second question is regarding the expenses. So we saw a very good number, so a reduction of the nominal expenses year-by-year. So my question is if it's possible to see during the year expenses growing less than inflation on the year-end. Gustavo Bahia Sechin: Hi, Mizrahi. Gustavo here. I will start for your -- to your second question. So I would say that you must consider that we have in terms of our expense, a mix between variable and fixed expense. So we have a very important component in terms of variable expense. So growing expense below inflation, for sure, that is a target we are always seeking, but it's a little bit hard to set as a reference in the short term. That's one point. But again, as I said in the previous question, we are just in the beginning in terms of how we can capture opportunities to generate operational leverage in different initiatives through the company. Talking about the funding cost, as Mauad said, I think that we are going to see some improvement in terms of the initiatives that we just implemented. But on the other side, I would say that those kind of initiatives has a strategic component that we prefer not to disclose at this point. Marcelo Mizrahi: Okay. But they are -- sorry to ask a follow-up here. So it's new ways of -- to improve the cost of funding. I mean, another strategy to improve the funding cost. Those are the strategies here. Gustavo Bahia Sechin: Yes, sure. Without compromising our deposits, of course, we don't want to decrease the cost and decrease the deposits. We're going to do both, decrease the cost while growing deposits. Carlos Mauad: Well, guys, this is the end of our call here. I would like to thank you all for your time and for all the questions that we had the opportunity to answer here. See you guys next time. Thank you very much. Operator: This concludes today's conference call. You may now disconnect, and have a nice evening. Before you buy stock in PagSeguro Digital, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and PagSeguro Digital wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. 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As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool recommends PagSeguro Digital. The Motley Fool has a disclosure policy. PagSeguro (PAGS) Q1 2026 Earnings Transcript was originally published by The Motley Fool

Nu Holdings (NYSE:NU), a Latin American digital banking and financial services provider, closed Monday at $12.29, up 0.78%. The stock moved as traders continued to reassess Nu’s recent record Q1 results against rising credit provisions and margin pressures. Investors are watching how profitability holds up as loan growth and digital banking expansion continue. Trading volume reached 59.4 million shares, nearly 11% above its three-month average of 53.3 million shares. Nu Holdings IPO'd in 2021 and has grown 19% since going public. S&P 500 slipped 0.07% to finish Monday’s session at 7,403, while the Nasdaq Composite fell 0.51% to close at 26,091. In digital banking and financial technology, peers were mixed: SoFi Technologies closed at $15.71, up 0.64%, while PagSeguro Digital ended at $9.18, up 3.61%. Nu’s stock dropped roughly 10% last week after it narrowly missed analysts’ expectations with its Q1 earnings. However, the company inched higher today, in part due to news that Coatue Management raised its Nu holdings from 29 million shares to 40 million in the latest quarter. Furthermore, while Nu’s earnings were slightly disappointing, the company’s long-term outlook remains impressive. In Q1, Nu: grew customers by 13% saw average revenue per active customer rise to $16 from $12 reached a record efficiency ratio of 18% raised its net income by 56% delivered steady credit quality Trading at 19 times earnings, Nu remains a promising growth stock in my eyes, despite its short-term focused earnings “miss.” Before you buy stock in Nu Holdings, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Nu Holdings wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $469,293!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,381,332!* Now, it’s worth noting Stock Advisor’s total average return is 993% — a market-crushing outperformance compared to 207% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors. See the 10 stocks » *Stock Advisor returns as of May 18, 2026. Josh Kohn-Lindquist has positions in Nu Holdings and SoFi Technologies. The Motley Fool has positions in and recommends Nu Holdings. The Motley Fool recommends PagSeguro Digital. The Motley Fool has a disclosure policy. Stock Market Today, May 18: Nu Holdings Rises After Record Q1 Results Ease Profitability Concerns was originally published by The Motley Fool