Revolut’s Profit Surge and Stake Shift: A Closer Look at the Numbers

Revolut, the UK-based fintech giant, has been in the headlines for its rapid growth, with reports claiming its profit soared to $1.5 billion as CEO Nikolay Storonsky increased his stake to over 25%. But dig into the data, and a more nuanced story emerges—one that separates revenue growth from profit milestones and clarifies Storonsky’s actual holdings. Here’s what investors need to know.

Profit: Revenue vs. Earnings

The oft-cited $1.5 billion figure appears to conflate revenue with profit. According to Revolut’s 2023 annual report, revenue hit $2.2 billion (up 95% from 2022), while profit before tax was $545 million. For 2024, industry analysts project profit before tax to reach $1 billion, nearly doubling the 2023 figure. This growth stems from customer expansion (45 million globally by mid-2024, targeting 50 million by year-end) and diversification into high-margin services like mortgages, crypto, and business banking.

The $1.5 billion claim likely misrepresents 2023 revenue, which hit $2.2 billion, with the profit portion still below that threshold. Revolut’s net profit margin of 19% (2023) underscores its operational efficiency but also highlights the gap between top-line growth and bottom-line results.

Storonsky’s Stake: A Partial Sale, Not a Stake Increase

The second headline—that Storonsky increased his stake to over 25%—is also misleading. While Storonsky remains Revolut’s largest shareholder (his exact stake isn’t publicly disclosed), recent reports indicate he is selling a “small portion” of his holdings as part of a secondary share sale. The proceeds, valued at “tens of hundreds of millions,” depend on Revolut’s valuation by new investors.

This sale doesn’t signal a loss of confidence but reflects a strategic move to monetize gains amid Revolut’s rising valuation (now $45 billion post-2024 secondary sale). Storonsky’s continued control aligns with his vision for Revolut as a “banktech” player, balancing regulatory compliance with agility in markets like the U.S., where it awaits a full banking license.

Valuation and Future Risks

Revolut’s $45 billion valuation, up 36% since 2021, reflects investor optimism about its path to profitability and global scale. Yet challenges loom:

1. Regulatory Hurdles: Securing a U.S. banking license remains uncertain, and stricter oversight in Europe could crimp margins.
2. Market Saturation: Competitors like Wise and N26 are intensifying price wars, potentially squeezing Revolut’s subscription revenue.
3. Profitability Sustainment: While 2024’s $1 billion profit target is achievable, maintaining growth amid rising costs (e.g., tech investments, compliance) will test execution.

Conclusion: A Fintech on the Move, but Not Without Speed Bumps

Revolut’s trajectory is undeniably compelling: a 95% revenue jump in 2023, a projected doubling of profit in 2024, and a customer base growing by millions annually. The $1.5 billion figure, however, misleads investors—it’s revenue, not profit, and Storonsky’s stake remains secure despite partial sales.

For investors, Revolut’s potential lies in its pivot from a transaction-focused app to a full-service bank. Its $45 billion valuation and plans for an IPO by 2026 suggest confidence, but success hinges on navigating regulatory minefields and sustaining margins in a crowded fintech landscape.

In short, Revolut is a star in the fintech constellation—but like any rising star, it faces the risk of burning out if it can’t keep its growth engines firing.

Final thought: Revolut’s story isn’t just about numbers—it’s about redefining banking. But numbers, when accurate, are where the real value lies.