XP Inc. Q2 Earnings and Revenue Beat May Boost Investment Outlook

XP Inc. reported Q2 2025 earnings with revenue of R$4.46 billion and net income of R$1.32 billion, both higher than the prior year. The company's diluted earnings per share increased to R$2.46, highlighting improved profitability. XP's stronger revenue and earnings growth may shape its investment narrative, with a focus on capturing emerging client wallets and accelerating net new money inflows while preserving margins.

XP Inc. (NASDAQ: XP) reported its second-quarter 2025 earnings, showcasing robust financial performance with revenue of R$4.67 billion and net income of R$1.32 billion, both higher than the prior year. The company's diluted earnings per share (EPS) increased to R$2.46, indicating improved profitability [2].

Key highlights from the quarterly results include:
- Revenue Growth: XP Inc. reported a 4% year-over-year (YoY) increase in revenue, reaching R$4.67 billion. This growth was driven by a 14% YoY increase in client assets, reaching R$1.4 trillion, and a 2% YoY growth in active clients to 4.7 million [2].
- Net Income Growth: The company's net income grew by 18% YoY to R$1.32 billion. This represents a significant improvement over the prior year's net income of R$1.12 billion [2].
- Profitability: XP Inc. maintained a net margin of 29.7%, up from the previous quarter and year-over-year growth of 320 basis points. This indicates the company's resilience and scalability in a challenging economic environment [2].
- Capital Management: The company's Common Equity Tier 1 (CET1) capital ratio rose to 18.5%, well above the Brazilian sector average of 12%. This demonstrates significant capital flexibility and supports robust shareholder returns [2].
- Client Growth: Active clients grew by 2% YoY and 1% quarter over quarter (QoQ), totaling 4.7 million in the second quarter of 2025. More than half of new asset inflows now come from internal advisers and the Registered Investment Adviser (RIA) model, highlighting channel diversification [2].

Looking ahead, XP Inc. reaffirmed its target of approximately 10% full-year revenue growth for 2025 and aims for an average of R$20 billion in retail net new money per quarter, subject to macroeconomic conditions. The company expects higher revenue acceleration in the second half of 2025 compared to the first half [2].

References:
[1] https://www.nasdaq.com/articles/xp-inc-reports-record-q2-profit
[2] https://www.ainvest.com/news/xp-q2-2025-unraveling-contradictions-capital-generation-dividends-growth-guidance-2508/
[3] https://www.businesswire.com/news/home/20250818037397/en/XP-Inc.-Reports-Second-Quarter-2025-Results