StoneCo 2025 Q1 Earnings Strong Performance as Net Income Rises 38.3%

StoneCo (STNE) reported its fiscal 2025 Q1 earnings on May 08th, 2025. StoneCo's Q1 results exceeded expectations, showcasing a substantial increase in both revenue and net income. The company's guidance for the upcoming quarter remains optimistic, aligning with market expectations. With continued growth in key financial metrics, stoneco is positioned for a promising fiscal year, reinforcing investor confidence. The leadership's strategic focus on expanding service offerings supports a positive outlook, aiming to maintain its competitive edge in the dynamic market landscape.

Revenue
The total revenue of StoneCo increased by 18.1% to $3.48 billion in 2025 Q1, up from $2.95 billion in 2024 Q1. Net revenue from transaction activities and other services reached $684.36 million, while subscription services and equipment rental generated $493.22 million. Financial income contributed significantly with $2.30 billion, alongside other financial income amounting to $189.31 million. Overall, StoneCo's total revenue and income tallied up to $3.67 billion.

Earnings/Net Income
StoneCo's EPS rose 52.1% to $1.84 in 2025 Q1 from $1.21 in 2024 Q1, marking continued earnings growth. Meanwhile, the company's profitability strengthened with net income of $516.75 million in 2025 Q1, marking 38.3% growth from $373.60 million in 2024 Q1. Remarkably, in 2025 Q1, the company set a new record high for fiscal Q1 net income, the highest in 8 years. The impressive EPS and net income growth indicate strong financial performance.

Post-Earnings Price Action Review
Investors following a strategy of purchasing StoneCo shares after a quarterly revenue drop and holding for 30 days found disappointing results over the past five years. This approach yielded a return of -19.47%, significantly underperforming the benchmark return of 92.56%. The strategy also presented high risks, as evidenced by a Sharpe ratio of -0.07 and a maximum drawdown of -91.62%. Such negative returns suggest the strategy was ineffective in generating profits or managing risk, highlighting the challenges of timing the market based on revenue fluctuations.

CEO Commentary
Thiago P. de Andrade, CEO of StoneCo, expressed satisfaction with the company's growth trajectory, highlighting strong revenue performance driven by increased adoption of their financial technology solutions. He acknowledged challenges in the competitive landscape but emphasized the commitment to strategic investments that enhance market positioning. Andrade noted the importance of innovation in driving customer engagement and satisfaction, fostering resilience amid market fluctuations. He conveyed optimism about future growth prospects, citing a solid customer base and a focus on expanding service offerings as key drivers for sustained performance.

Guidance
For the upcoming quarter, StoneCo expects revenue to reach approximately $675.52 million and EPS of $0.32. For the current fiscal year, the guidance targets $2.7 billion in revenues and an EPS of $1.38. The leadership is confident in achieving these targets, driven by ongoing optimization of operations and continued investment in technology and market expansion initiatives.

Additional News
StoneCo Ltd. recently announced a substantial $2 billion share buyback plan, demonstrating a commitment to enhancing shareholder value. This strategic move reflects the company's strong financial position and confidence in its future prospects. Additionally, StoneCo will host a conference call to discuss its first quarter 2025 financial results, providing insights into its performance and strategic initiatives. Investors can access the call via Zoom or by phone from various locations, including the U.S., Brazil, and the UK. A webcast replay will be available on StoneCo's investor relations website shortly after the call concludes.