Lojas Quero-Quero (LJQQ3) Q4 2025 earnings summary

Executive summary

• Gross revenue grew 3.8% year-over-year to R$3,172.3 million in 2025, with 21 new stores opened, ending the year with 586 stores across 497 cities; 27 stores renovated.

• Same-store sales declined 2% in Q4 2025 but improved sequentially; for the year, SSS declined 1.8% amid demand volatility and a more promotional retail environment.

• Digital and phygital sales reached a record 28% of total sales in Q4, up 3 percentage points year-over-year.

• Net income turned negative, with a net loss of R$161.9 million in 2025, mainly due to margin compression and operational deleveraging.

• Financial services and credit card segments outperformed, with credit card revenue up 16.5%, financial services revenue up 12%, and credit portfolio growth of 18% year-over-year; VerdeCard delinquency stable at 11.1%.

Financial highlights

• Net operating revenue increased 4.6% year-over-year to R$2,788.4 million.

• Gross margin for retail declined to 22.4% for 2025, with overall gross margin over net revenue at 32.4%, down 2.4 p.p. year-over-year.

• Adjusted EBITDA for Q4 was BRL 13.7 million, with full-year adjusted EBITDA at R$34.9 million, down 62.9% year-over-year.

• Net loss of R$161.9 million in 2025, with adjusted net loss at R$95.2 million.

• Net financial expenses rose 38.1% to R$167.0 million, driven by higher Selic rates.

Outlook and guidance

• Management expects interest rate reductions and expanded personal income tax exemption in 2026 to boost sales and credit demand, with a focus on cash flow, operational efficiency, and cautious expansion tied to cash generation and macroeconomic conditions.

• Positive sales momentum observed at the start of 2026, with January showing year-over-year growth.