NU Stock Rises Overnight On Strong Q3 Results: CEO Says New Banking Status Makes Proposition ‘Even More Compelling’

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Nu’s gross revenue notched a record $6.3 billion in the quarter, up 37% year-over-year, beating Wall Street expectations.

Shares of Nu Holdings Ltd. (NU) climbed more than 3% in overnight trading late Thursday after the company's strong third-quarter (Q3) earnings results boosted investor optimism.

The quarter also marked the digital banking company's transition into a full bank in Mexico. Nu Mexico began operating as a full-service bank on Aug. 6, following final authorization from the National Banking and Securities Commission (CNBV).

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Nu's gross revenue notched a record $6.3 billion in the quarter, up 37% year-over-year, beating expectations of $5.94 billion, as per data from Fiscal.ai.

Gross profit rose 35% to $2.6 billion, with revenue from all three sources, i.e., credit, fees and float, notching higher growth year-over-year in absolute terms.

The company's credit portfolio grew 33% YoY to $41.6 billion. Credit cards grew 32% to $27.2 billion, unsecured lending notched 39% growth to $11 billion and secured lending came in at $3.4 billion, a 23% growth. Secured-loan originations reached a record in the quarter. Nu's asset quality also improved across the board.

"We continue to expand our credit portfolio, deliberately taking some additional risk when the expected returns justify it. What gives us confidence in this strategy is the strength of our underwriting and the resilience of our credit performance," Rob Livingston, Chief Financial Officer, said in a call with investors.

The third quarter marked Nu's first quarter as an official bank in Mexico. The company said that it added 870,000 customers in the quarter, adding that the "new banking status makes our proposition even more compelling."

In total, Nu reached 16.6 million customers in the country. The bank clocked a 16-fold increase in deposit insurance coverage from about $12,000 to $195,000 per customer.

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