PagBank reports net revenue of R$4.9 billion and recurring net income of R$554 million in 1Q25

Rhea-AI Summary

PagBank (NYSE: PAGS) reported strong Q1 2025 financial results with net revenue of R$4.9 billion (up 13% YoY) and recurring net income of R$554 million (up 6% YoY). The company announced its first-ever dividend payment of USD 0.14 per share, payable on June 6, 2025, and plans to distribute approximately 10% of net income as annual dividends going forward.

Key highlights include: gross margin of R$1.9 billion (up 7% YoY), credit portfolio growth of 34% YoY to R$3.7 billion, and stable NPL rate of 2.3%. The company's total payment volume (TPV) reached R$129 billion (up 16% YoY), while total deposits grew 10.9% YoY to R$33.9 billion. PagBank also continued its share buyback program, repurchasing R$353 million in shares, and announced the cancellation of 24 million shares.

Positive

• Net revenue increased 13% YoY to R$4.9 billion
• Recurring net income grew 6% YoY to R$554 million
• Credit portfolio expanded 34% YoY while maintaining low NPL of 2.3% vs market average of 4.4%
• First dividend payment announced at USD 0.14 per share
• Total Payment Volume grew 16% YoY to R$129 billion
• ROE improved by 140 basis points YoY to 15%
• Active share buyback program with R$353 million in repurchases

Negative

• Higher interest rates (Selic) impacting operations
• Recurring net income growth (6%) lagging behind revenue growth (13%)
• Gross margin growth of 7% YoY showing some compression relative to revenue growth

Insights

Financial Analyst

PagBank shows solid Q1 growth with 13% revenue increase, improved profitability metrics, and announces its first-ever dividend payment.

PagBank delivered strong financial results in Q1 2025 despite challenging macroeconomic conditions. Net revenue reached R$4.9 billion, growing 13% year-over-year, while recurring net income hit R$554 million, up 6% YoY. The company's earnings per share increased impressively by 14% to R$1.72.

The company's credit portfolio expanded to R$3.7 billion, growing 34% YoY and 6% QoQ, while maintaining strong asset quality. About 85% of this portfolio is collateralized, and the 2.3% NPL ratio (loans 90+ days delinquent) significantly outperforms the broader market's 4.4% average. This demonstrates disciplined risk management even during portfolio expansion.

PagBank's customer base now exceeds 32 million, with 17.7 million actively engaged users. Total payment volume reached R$129 billion (16% YoY growth), and total deposits grew 10.9% to R$33.9 billion, showing strong operational momentum and customer trust.

The company's profitability metrics show improvement with gross margin increasing from 38% to 39% QoQ, and annualized ROE reaching 15% (up 140 basis points YoY). These results demonstrate effective margin management despite higher interest rates.

Most significantly, PagBank announced its first-ever dividend payment of approximately $0.14 per share (about R$250 million total), establishing a new annual dividend program targeting 10% of net income. The company also continues its share repurchase program (R$353 million since August 2024) and plans to cancel 24 million shares, indicating strong confidence in its financial position and commitment to shareholder returns.

The company announces its first dividend payment of approximately R$250 million (USD 0.14 per common share) and plans to distribute dividends annually

SÃO PAULO, May 14, 2025 /PRNewswire/ -- PagBank (NYSE: PAGS), a leading digital bank offering a comprehensive suite of financial services and payment solutions – always searching to make the financial lives of people and businesses easier – closed the first quarter of 2025 (1Q25) with growing results and improved profitability, despite a challenging macroeconomic environment. During the period, there was an increase in funds raised and expansion of our credit portfolio and deposits.

In the quarter, net revenue totaled R$4.9 billion, a 13% year-over-year increase, and gross margin reached R$1.9 billion, a 7% rise in the same period, reflecting the combined performance of the payment, banking, and credit business units. In the same period, recurring net income amounted to R$554 million, a 6% year-over-year increase, and earnings per share reached R$1.72, a 14% YoY increase – reaffirming our ability to grow and create value for shareholders.

The credit portfolio also expanded, reaching R$3.7 billion, a 34% rise compared to the previous year's first quarter and 6% quarter-over-quarter, maintaining a conservative profile, with approximately 85% of the portfolio backed by collateral. The delinquency rate over 90 days (NPL >90) remained stable at 2.3%, while the market average deteriorated to 4.4% in 1Q25.

"More than just a payment provider, more than a digital bank, we are partners in our clients' success. Our strategy and positioning are based on offering a complete, simple, secure, and accessible ecosystem built on three core pillars — payments, banking, and credit. Unsurprisingly, we now have a solid base of more than 32 million customers, with 17.7 million actively engaged in our ecosystem. We are constantly evolving, driving PagBank's growth and strengthening our leadership within the national financial system," said Alexandre Magnani, CEO of PagBank.

Financial margin and EPS grow despite higher interest rates

The growth in financial margin reflects the company's discipline and focus on profitability, along with active initiatives to offset the impact of the higher interest rates (Selic rate) average during the period.

As a result, the gross margin rose from 38% to 39% QoQ. Earnings per share (EPS) grew by more than 14% year-over-year, both in line with guidance, while return on equity (ROE) reached 15% on an annualized basis—a 140 basis points surge YoY—reflecting the company's capital discipline and commitment to value creation.

Total deposits reached R$ 33.9 billion, a 10.9% YoY rise, with a stable financial cost, demonstrating efficient fundraising even in a high-interest-rate environment. The total payment volume (TPV) processed reached R$129 billion, growing 16% over the previous year, and cash in—an important metric indicating banking client engagement—reached R$83 billion, up 26% YoY.

Since August 2024, the second share buyback program has been consistently executed, totaling over R$ 353 million in repurchased shares during the period, underscoring management's confidence in its growth strategy and its commitment to value generation for shareholders.

Additionally, PagBank announces the cancellation of approximately 24 million shares and informs that it will make its first dividend payment of USD 0.14 per share, to be paid on June 6, 2025 (ex-date on May 24, 2025). The company also plans to distribute, on an annual basis, dividends corresponding to approximately 10% of its net income , subject to market conditions and approval by the Board of Directors.

To access PagBank's 1Q25 financial statements, click here.

About PagBank 
PagBank promotes innovative solutions in financial services and means of payment, automating the process of buying, selling, and transferring to promote the business of any person or company simply and securely. PagBank, a company of the UOL Group - Brazil's Internet leader - acts as an issuer and acquirer, offering digital accounts and complete solutions for online and in-person payments (via mobile and POS devices).      
PagBank also offers a wide variety of payment methods, such as credit and prepaid cards, bank transfers, boleto payments, account balances, and more. PagBank (PagSeguro Internet Instituição de Pagamento S.A.) is regulated by the Central Bank of Brazil as a payment institution, issuer of electronic money, issuer of post-paid instruments, and acquirer, with partnerships with the leading card brands. Its parent company, PagSeguro Digital Ltd., is publicly traded in the United States (NYSE: PAGS) and regulated by the SEC (Securities and Exchange Commission). The distribution of mutual funds is carried out by BancoSeguro S.A., authorized by the Central Bank of Brazil, the Securities and Exchange Commission, and affiliated with ANBIMA.

PRESS OFFICE CONTACTS
XCOM - Agência de comunicação do PagBank
Isabelle Bonizzi / isabelle.bonizzi@xcom.net.br / (11) 96436-5456 
Sofia Andreassa/ sofia.andreassa@xcom.net.br/ (11) 99183-5814
Cláudio Monteiro / claudio.monteiro@xcom.net.br / (11) 98970-4477 
Deborah Slobodticov / deborah.slo@xcom.net.br / (11) 98829-7900 
Visit the PagBank Press Office 

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SOURCE PagBank

FAQ

What were PagBank's (PAGS) key financial results for Q1 2025?

PagBank reported net revenue of R$4.9 billion (up 13% YoY), recurring net income of R$554 million (up 6% YoY), and earnings per share of R$1.72 (up 14% YoY) in Q1 2025.

How much is PagBank's (PAGS) first dividend payment and when will it be paid?

PagBank announced its first dividend payment of USD 0.14 per share, to be paid on June 6, 2025, with an ex-date of May 24, 2025.

What is PagBank's (PAGS) credit portfolio performance in Q1 2025?

PagBank's credit portfolio grew 34% YoY to R$3.7 billion, with 85% backed by collateral and a stable NPL rate of 2.3%, compared to the market average of 4.4%.

How much did PagBank (PAGS) spend on share buybacks?

PagBank repurchased R$353 million in shares through its second buyback program since August 2024 and announced the cancellation of 24 million shares.

What is PagBank's (PAGS) future dividend policy?

PagBank plans to distribute annual dividends corresponding to approximately 10% of its net income, subject to market conditions and Board approval.