StoneCo (STNE) Q4 2024 earnings summary

Executive summary

• Achieved strong 2024 results with adjusted net income of R$2.2bn (+41.3% YoY), exceeding guidance, and adjusted EPS of R$7.27 (+46.6% YoY), despite macroeconomic headwinds and a 55% share price decline.

• MSMB TPV grew 22% year-over-year to R$454bn, with retail deposits up 42% to R$8.7bn, both above guidance.

• Credit portfolio expanded nearly fourfold to R$1.2bn, surpassing the R$800m target.

• Adjusted Net Income and EPS saw significant year-over-year increases, despite a non-cash goodwill impairment in the Software segment.

• Strategic focus on MSMB sector, client engagement, and platform scalability drove results.

Financial highlights

• Total revenue for 2024 reached R$13.26bn (+10.0% YoY); 4Q24 revenue was R$3.61bn (+11.1% YoY).

• Adjusted gross profit for 2024 was R$6.19bn (+21.0% YoY); 4Q24 adjusted gross profit was R$1.70bn (+12.9% YoY).

• Adjusted EBT for 2024 was R$2.73bn (+39.8% YoY); 4Q24 adjusted EBT was R$778.1m (+21.9% YoY).

• Adjusted net margin for 4Q24 was 18.4%, up from 17.4% in 4Q23.

• Adjusted basic EPS for 4Q24 was R$2.26 (+25.8% YoY), driven by share buybacks.

Outlook and guidance

• 2025 guidance: adjusted gross profit above R$7.05bn (+14% YoY) and adjusted basic EPS above R$8.6 (+18% YoY), assuming SELIC at 15% and ~20% effective tax rate.

• 2027 guidance: MSMB TPV to surpass R$670bn (+14% CAGR), retail deposits above R$14bn (+17% CAGR), credit portfolio above R$5.5bn (+66% CAGR), adjusted gross profit above R$10.2bn (+18% CAGR), and adjusted basic EPS above R$15 (+27% CAGR).

• Long-term guidance expects retail deposits and credit portfolio growth to outpace TPV.

• Management expects a challenging 2025 due to higher projected long-term interest rates impacting economic activity.

• Expects a shift in retail deposit structure in 2025 with the roll-out of new time deposit products.