Nu Holdings Ltd. (NU) shares plummeted 8.85% in Thursday's post-market session following the digital banking company's Q4 2024 earnings report that missed revenue estimates and raised concerns about its ability to sustain rapid growth profitably.
While Nu Holdings reported strong 22% year-over-year customer growth to 114.2 million, reaching the third-largest financial institution in Brazil, its revenue of $2.99 billion fell short of analysts' expectations of $3.29 billion. The revenue miss, despite in-line EPS of $0.11, sparked investor worries that Nu's breakneck expansion may be facing headwinds amid increasing competition and market saturation in Latin America's fintech space.
Additionally, comments from CEO David Vélez about scaling products and services globally while focusing on "sustainable growth" in current markets fueled concerns over potential execution risks. As Nu Holdings forges ahead with ambitious plans like entering Mexico and launching NuCel and NuTravel services, investors may be growing wary of the company's ability to profitably manage its multifaceted growth strategy.