In January 2026, Nubank announced something that would have been unthinkable a decade ago: the fintech founded in 2013 had surpassed Bradesco to become Brazil's second largest financial institution by client count, with 112 million account holders. That figure represents 61% of Brazil's adult population.
The milestone is more than a statistic. It signals a structural shift in the country's financial system — with concrete implications for investors, consumers, and the broader market.
The numbers behind the rise
Fourth quarter 2025 results left little doubt about the strength of Nubank's trajectory. Revenue reached US$4.86 billion, up 45% year over year. Net income came in at US$783 million. Return on equity (ROE) hit 33%, the highest in the company's history.
Perhaps the most telling indicator of business model maturity is ARPAC — average revenue per active client — which rose to US$15, a 45% increase year on year. This means Nubank is not just adding customers: it is generating significantly more value from each existing relationship.
For context, traditional banks like Bradesco and Itaú long held that relationship depth was their competitive moat. The narrative was that digital bank clients were shallow — they opened accounts for the no-fee credit card but kept their traditional bank as their primary institution. The 2025 numbers challenge that narrative directly.
What joining Febraban means
In March 2026, Nubank was unanimously approved for membership in Febraban — the Brazilian Banking Federation, the industry's main trade association. The move is both symbolic and strategic.
For years, the relationship between fintechs and traditional banks was defined by tension. Nubank was at the center of public disputes with Febraban over interest rates and taxation. Joining the association as a full member marks a shift in posture: Nubank is moving from operating as an external disruptor to shaping the industry from within.
The Febraban membership is also linked to Nubank's pursuit of a full banking license, which would expand its ability to offer regulated credit products and financial services. The company maintains it has no plans to become a traditional bank, but the institutional trajectory points in an increasingly conventional direction.
Artificial intelligence as an operational differentiator
Part of the margin improvement recorded in Q4 2025 is directly tied to the use of artificial intelligence in credit analysis. A proprietary AI model is now applied to credit underwriting and pricing, allowing Nubank to expand its loan book while keeping delinquency in check.
This is significant because it addresses one of the persistent criticisms of the Nubank model: that rapid growth and credit portfolio health were fundamentally incompatible. The 2025 results suggest otherwise — and technology is the mechanism that made it possible.
The bank also made meaningful advances in two new segments: small and medium business banking (PJ), and the high-income segment, traditionally dominated by Itaú Private and BTG Pactual. These markets carry substantially higher average ticket sizes than Nubank's original customer base, which helps explain the sustained ARPAC growth.
The stock: opportunity or overhang?
Nubank's operational performance in 2025 was strong. The stock — ROXO34 on B3, NU on NYSE — underperformed the broader banking sector in 2026, at least through April.
Analysts interpret this divergence differently. BTG projects Nubank's profit will reach US$4 billion in 2026, more than double the 2025 result. BB Investimentos estimates the stock has 20% upside for the year, characterizing the current valuation as a rare entry window.
The argument is that the market is still pricing Nubank as a high-growth fintech, applying an uncertainty discount that no longer reflects the company's fundamentals. With a 33% ROE, an expanding credit book, and an AI-driven model validated at scale, the company's risk profile has materially changed.
That said, the thesis is not without risk. Nubank remains in a credit expansion phase, which exposes it directly to Brazil's macroeconomic cycle — interest rates, delinquency, and currency movements all affect results. Competition from traditional banks accelerating their own digital operations is also intensifying.
What Nubank's rise reveals about the market
The Nubank story is not just about one company. It reflects a systemic transformation in Brazilian finance.
Brazil has historically had one of the most concentrated banking systems in the world. For decades, five institutions — Itaú, Bradesco, Santander, Banco do Brasil, and Caixa Econômica Federal — controlled the vast majority of credit, deposits, and financial infrastructure. Fees were high, processes were bureaucratic, and access was uneven.
The entry of Nubank — alongside other digital players like Inter, PagBank, and C6 — forced an accelerated modernization across the sector. Traditional banks eliminated account maintenance fees, digitized processes, and reduced service friction. The Central Bank's launch of Pix instant payments in 2020 was in part a regulatory response to the competitive pressure created by these new entrants.
For Brazilian consumers, the outcome has been clearly positive: broader access, lower costs, and more options. For investors, the picture is more nuanced. Margin compression in basic banking services has pushed all players toward higher-value products — credit, investments, insurance — to sustain profitability.
A more competitive, more efficient industry
Nubank's rise to become Brazil's second largest bank validates a thesis that has been building for years: that technology, data, and user experience can generate competitive scale even in heavily regulated sectors with deep historical entry barriers.
The implications extend beyond banking. Other industries with a similar profile — health, insurance, education — are already facing or will face analogous processes of digital disruption: new entrants with lower operating costs, superior experience, and rapid growth forcing incumbents to adapt or lose relevance.
For investors tracking the Brazilian market, Nubank's trajectory is as much a macroeconomic signal as it is a corporate one. It suggests that Brazil can produce technology-driven companies with real scale and sound fundamentals — and that the country's financial sector is undergoing a deep, irreversible transformation.
The milestone of 112 million clients is a number. What it represents is the maturation of digital finance as the new default in one of the world's largest economies.
At Royal Binary, we track the market with disciplined operations and active risk management. To learn about our model and how we work, visit app.royalbinary.io.