Stoneco Stock Earnings Reports

Q1 2026 was broadly in line with the company’s expectations for a softer first half. Three main dynamics shaped the quarter: a challenging macro environment for smaller merchants, typical seasonality, and a credit portfolio that grew profitably but experienced higher-than-expected NPLs. Financial highlights: total revenue was BRL 3.6 billion (up 6% YoY), adjusted gross profit was BRL 1.5 billion (broadly stable), adjusted basic EPS BRL 2.19 (up 15% YoY driven by buybacks), and managerial capital ratio was 44% (elevated by Linx divestiture proceeds). Capital allocation: year-to-date distributions of BRL 3.6 billion (a 27% yield) including an extraordinary Linx-related dividend and ~BRL 0.6 billion in buybacks, with at least BRL 1.4 billion of buybacks remaining in 2026. Operational priorities for the rest of 2026: reaccelerate profitable TPV growth by reducing churn and simplifying bundles/pricing; grow credit with disciplined underwriting and more secured products; improve efficiency (including AI-driven initiatives); and increase client penetration of the unified app and ecosystem. Credit specifics: total credit portfolio BRL 3.2 billion (up 14% QoQ), credit revenue BRL 297 million (strong growth), but NPLs rose (15–90 days and >90 days), provisions of BRL 166 million in Q1 and cost of risk at 21.9%. Coverage ratio was 229%. Management has tightened underwriting, raised pricing, adjusted risk selection, deployed new models, reduced max ticket sizes in the dedicated desk, and begun disbursing secured working-capital products; early signs (March cohort) show improvement and management expects cost of risk to decline over time toward mid–high teens. Guidance: full-year 2026 guidance unchanged, weighted to the second half, but subject to interest-rate risk (current higher-for-longer rates are the main downside).