XP Inc. (NASDAQ: XP) (“XP” or the “Company”), a leading
tech-enabled platform and a trusted pioneer in providing low-fee
financial products and services in Brazil, reported today its
financial results for the fourth quarter of 2024.
To our shareholders,
As we close out 2024, I want to begin this message by expressing
my gratitude to all our clients, employees, and investors for the
trust you have placed in XP Inc. over another year. We all know
that this was a period marked by economic challenges, but as an
entrepreneurial and resilient company, we faced each of them with
the certainty that we were doing what was necessary to evolve in
all aspects. Just as we have transformed the financial market over
the past two decades with a strong and unique culture, I believe
that this remains one of our greatest competitive advantages as we
continue to challenge the status quo and lead the changes we want
to see in the future.
I am proud to say that we have innovated by democratizing access
to high-quality investment products and providing exclusive
advisory services to Brazilian investors. Now, we want to go even
further and are starting a new revolution in how Brazilians manage
their financial lives. Our holistic financial planning approach
considers much more than just investments. We aim to help our
clients plan for their short- and long-term future, succession, tax
structuring, and all financial needs throughout different life
stages. This is how we envision our next steps—by delivering the
best and most customized advisory and service experience. And our
achievements and progress throughout 2024 show that we have
advanced on this path, utilizing the full strength of our
ecosystem.
As we continue down this path, I can assure you that we remain—
and will continue to remain—focused on sustainable and long-term
value creation for our shareholders, clients, and partners. Through
disciplined execution and intensity, we have strengthened our
competitive position, delivered solid revenue and profit growth,
while maintaining our DNA of operational efficiency and cost
control.
Highlights 2024
This year, we delivered solid operational results, growing our
key performance indicators. We closed 2024 with a 9% increase in
Client Assets, reaching R$1.2 trillion, and reinforced our
leadership as the largest and most qualified investment advisory
network in Brazil, with 18 thousand advisors. Our revenues grew by
15%, reaching R$18 billion, and our adjusted net income increased
by 17%, reaching R$4.5 billion, driven by a record efficiency ratio
of 34.7%. All the figures mentioned above are historical records,
achieved in a year of significant macroeconomic volatility,
demonstrating that our strategies for diversifying results through
new services and products have made us much more resilient.
Strategy
The strategic decisions made in recent years have transformed
XP. I am convinced that today we are a much more prepared,
efficient, and capable company, ready to fulfill our mission and
deliver sustainable long-term growth. Our strategy is clear and
focused on three key pillars, all centered on a culture of
quality, resulting in the creation of a company that provides
premium financial services, at scale, to our clients.
1. Leadership in Core Business To achieve market
leadership—our primary objective—we must maintain and expand our
competitive advantages, allowing us to continue growing across
different investor segments. Within this strategic pillar, our key
focus areas are:
A Differentiated Product Platform
We have made continuous investments in our investment platform,
with a strong focus on technology and innovation. In 2024, this
became even more evident. Our commitment to modernizing our
fixed-income platform resulted in the launch of new liquidity
products and private credit solutions, replicating banks’ ability
to offer tax-exempt with daily liquidity products. These
initiatives have driven daily fixed-income trades to approximately
40 thousand, representing a 38% CAGR since 2020, positioning us as
an increasingly unique market maker in Brazil.
Expansion and Diversification of Distribution
Channels
Our distribution ecosystem is now larger, more sophisticated,
and equipped with cutting-edge technology. Since 2020, we have
developed three new distribution channels—Internal Advisory,
Wealth Managers, and RIAs—which have gained relevance and are
beginning to show significant returns.
We ended 2024 with nearly 3,000 internal advisors and solidified
our leadership in the Wealth Services segment (Wealth Managers and
RIAs)—a highly scalable, technology-driven business. The quality of
our offering is an unmatched differentiator in the market. As a
result of these advances, approximately 60% of our retail
net inflows in 2024 came from these new channels, highlighting our
ability to grow and diversify revenue streams.
Smart Segmentation and Operational Efficiency
We redesigned our client segmentation framework, aligning
different customer profiles with tailored service models across
four key dimensions: advisory model, investment product offering,
banking products, and post-sale support.
Additionally, by better aligning value propositions with
specific customer segments, we have also been able to optimize
serving costs, which should lead to higher margins in the future.
We are just beginning to reap the benefits of this new structure,
but its importance in driving market share expansion across diverse
customer segments is already clear.
In this context, it is worth highlighting our Private segment,
where we have made significant investments in recent years and are
now starting to see the results. While segmentation played a key
role in this progress, there is still a significant opportunity to
unlock further potential. Today, our Private segment already
outperforms in net inflows and client satisfaction compared to
previous years. We are encouraged by the results of recent months
and are confident in an excellent 2025.
High-Value-Added Services
Segmentation also plays a key role in how we serve different
client profiles. We have customized our value proposition to
different needs: retail clients receive advisory services,
high-net-worth clients have access to Financial Planning, and
Private clients benefit from Wealth Planning.
Financial Planning is a fundamental pillar of our strategy. XP
is the only institution in Brazil to offer a comprehensive
Financial Planning solution for clients with assets above
R$300,000. This differentiation not only enhances client
satisfaction but also increases platform loyalty.
Initial results have been extremely positive. Clients utilizing
Financial Planning demonstrate higher engagement, with twice the
conversion rate in insurance purchases, an increase in retirement
plans conversion rate from 30% to 41%, and net inflows that are 43%
higher than those who do not use the service. We are at the
beginning of a new wave of transformation in the market—and we will
continue to lead it.
2. Retail Cross-Sell Starting from our clients’ needs, we
will expand our offer to serve their complete financial needs,
aiming to break the link of investors with the incumbent banks once
and for all.
The growth of our offering beyond investments has been a key
pillar of this strategy. Today, between 15% and 20% of our revenue
comes from non-investment-related products, boosting share of
wallet, customer satisfaction (NPS), and reducing churn. Despite
these advances, penetration of these products remains relatively
low within our client base, reinforcing our confidence in
accelerated growth potential for the coming years.
3. Wholesale We want to fully explore the synergy of a
Wholesale Bank offer with the investment universe, deepening our
relationship with the main economic groups in Brazil.
Our wholesale strategy is evolving rapidly, replicating the
successful model we built in retail, now tailored to serve Middle
Market and large corporate clients. Our competitive advantage lies
in the combination of high-quality products and a differentiated
service model, where we excel in quality, agility, client
proximity, and cost-efficient service.
Unlike traditional banks, our model is less capital-intensive.
We do not aim to accumulate assets but rather leverage our unique
distribution capabilities to serve companies more efficiently. This
approach allows us to operate with a higher payout ratio and ROE
than industry standards, consolidating XP as an innovative
alternative in the Wholesale Banking space.
Profitability Growth and New Corporate Structure
Throughout 2024, we communicated our progress on our corporate
reorganization, which was concluded in November 2024. This new
structure enhances our ability to deliver sustainable
capital returns to our shareholders, leveraging the increased
funding efficiency and higher leverage potential of Banco XP, which
benefits both our Retail and Wholesale businesses.
In 2024, we distributed 74% of our net income through dividends
and share buybacks, maintaining a disciplined approach that
balances capital returns with reinvestment opportunities for future
growth.
Looking ahead, EPS growth and ROE expansion will be key
indicators of value creation for our shareholders. We expect EPS
to grow at a faster rate than net income in the coming years,
primarily driven by our ongoing share repurchase programs.
Additionally, we believe that our current ROE does not yet
reflect the full return on our marginally deployed capital. We
continue to operate with excess capital, and we are still in the
early stages of expanding our margins toward the levels outlined in
our 2026 guidance.
Outlook for 2025
We believe that next year will provide another opportunity to
demonstrate the counter-cyclical strength of our business model.
The higher interest rate environment is expected to directly
support the growth of Client Assets, which remains the key revenue
driver for our main retail investment products. Additionally, we
anticipate another strong year for fixed income, along with further
market share expansion in strategic segments such as DCM.
Our new business verticals continue to outperform the broader
market, contributing to greater revenue diversification and
resilience. At the same time, we remain highly disciplined in
expense management, ensuring we can adapt to changes in the
economic cycle while preserving profitability.
We remain highly confident in delivering our 2026 guidance, as
outlined during our 2023 Investor Day, despite the evolving
macroeconomic environment.
Acknowledgments and Vision for the Future
I always say that a great legacy like ours is never built alone.
Every achievement and milestone we reach is a direct reflection of
the trust placed in our company and, above all, the dedication of
our people. Having a strong team, deeply rooted in our culture, and
sharing our ambitious vision has been essential since day one—and
it continues to make all the difference. I have no doubt that we
are on the right path, with the right people to achieve our
ambitions and continue growing and creating value for our
shareholders.
This year, I celebrated my 10-year anniversary at XP, and I can
personally attest to the power of our culture in shaping our
journey.
As we look ahead to 2025 and beyond, we see an immense
opportunity to go even further than we have before. We remain fully
confident in our strategy and increasingly committed to delivering
best-in-class services to our clients, while continuously investing
in our people and technologies to ensure our business scales with
efficiency and a relentless focus on client needs.
I have great confidence in our advisors, which has been
recognized as the best in the country for six consecutive years. We
continue evolving, ensuring we are where our clients need us to
be—listening, delivering better solutions, and supporting their
financial journey at every stage of life.
The future of XP Inc. is also the future of Brazil’s financial
market, and we will continue reinventing ourselves to transform the
industry and improve people’s lives.
Thiago Maffra,
CEO XP Inc
Summary
Operating Metrics (unaudited)
4Q24
4Q23
YoY
3Q24
QoQ
2024
2023
YoY
Total Client Assets (in R$
bn)
1,227
1,122
9%
1,213
1%
1,227
1,122
9%
Total Net Inflow (in R$ bn)
25
19
37%
31
-17%
103
105
-2%
Annualized Retail Take Rate
1.33%
1.27%
6 bps
1.33%
0 bps
1.29%
1.28%
1 bps
Active Clients (in '000s)
4,684
4,531
3%
4,659
1%
4,684
4,531
3%
Headcount (EoP)
7,442
6,669
12%
7,241
3%
7,442
6,669
12%
Total Advisors (in '000s)
18.2
17.2
5%
18.4
-1%
14.0
14.3
-2%
Retail DATs (in mn)
2.4
2.2
9%
2.3
5%
2.3
2.4
-4%
Retirement Plans Client Assets
(in R$ bn)
81
73
10%
78
3%
81
73
10%
Cards TPV (in R$ bn)
13.1
11.8
11%
12.0
9%
47.9
40.9
17%
Credit Portfolio (in R$ bn)
21.2
21.0
1%
20.1
6%
21.2
21.0
1%
Gross Written Premiums (in R$
mn)
401
293
37%
362
11%
1,317
914
44%
Financial Metrics1 (in R$ mn)
4Q24
4Q23
YoY
3Q24
QoQ
2024
2023
YoY
Gross revenue
4,725
4,309
10%
4,536
4%
18,035
15,726
15%
Retail
3,569
3,152
13%
3,494
2%
13,489
11,791
14%
Institutional
332
413
-20%
340
-2%
1,373
1,516
-9%
Corporate & Issuer
Services
599
508
18%
552
9%
2,289
1,576
45%
Other
224
236
-5%
150
49%
884
842
5%
Net Revenue
4,487
4,046
11%
4,319
4%
17,078
14,860
15%
Gross Profit
3,109
2,753
13%
2,940
6%
11,726
10,100
16%
Gross Margin
69.3%
68.1%
122 bps
68.1%
120 bps
68.7%
68.0%
69 bps
EBT
1,289
995
30%
1,212
6%
4,974
3,936
26%
EBT Margin
28.7%
24.6%
413 bps
28.1%
66 bps
29.1%
26.5%
263 bps
Adjusted Net Income1
1,210
1,040
16%
1,187
2%
4,544
3,899
17%
Adjusted Net Margin
27.0%
25.7%
126 bps
27.5%
-51 bps
26.6%
26.2%
37 bps
Adjusted Diluted EPS (in
R$)
2.23
1.88
19%
2.18
2%
8.28
7.16
16%
Adjusted ROAE2
23.4%
21.1%
230 bps
23.0%
40 bps
23.0%
21.4%
164 bps
Adjusted ROTE3
29.2%
25.6%
356 bps
28.4%
78 bps
28.7%
25.0%
376 bps
______________________________
1 – Please refer to the Non-GAAP
Financial Reconciliation for a detailed breakdown of these
adjustments.
2 – Annualized Return on Average
Equity.
3 – Annualized Return on Average
Tangible Equity. Tangible Equity excludes Intangibles and
Goodwill
Operating KPIs
1. INVESTMENTS
Client Assets and Net Inflow (in R$ billion)
Client Assets totaled R$1.2 trillion in 4Q24, up 9% YoY
and 1% QoQ. Year-over-year growth was driven by R$103
billion net inflow and R$2 billion of market
appreciation.
In 4Q24, Net Inflow was R$25 billion, and Retail Net
Inflow was R$20 billion, 21% lower QoQ, and 63% higher YoY.
Accumulated Retail Net Inflow for the full year of 2024 was R$81
billion, or 34% higher compared to 2023, excluding the effects
from inorganic Net Inflow from Modal’s Acquisition.
Active Clients (in ‘000s)
Active clients grew 3% YoY and 1% QoQ, totaling 4.7
million in 4Q24.
Total Advisors (in ‘000s)
Total Advisors connected to XP, including (1) IFAs, (2) XP
employees who offer advisory services, (3) Registered Investment
Advisors, consultants and wealth managers, among others. As of
4Q24, we had 18.2 thousand Total Advisors, an increase of 5%
YoY.
Retail Daily Average Trades (in million)
Retail DATs totaled 2.4 million in 4Q24, up 9% YoY and
down 5% QoQ. Retail DATs in 2024 was 2.3 million, 4% lower
YoY.
NPS
Our NPS, a widely known survey methodology used to measure
customer satisfaction, was 70 in 4Q24. Maintaining a high
NPS score remains a priority for XP since our business model is
built around client experience. The NPS calculation as of a given
date reflects the average scores in the prior six months.
2. RETIREMENT PLANS
Retirement Plans Client Assets (in R$ billion)
As per public data published by Susep, XPV&P’s individual’s
market share (PGBL and VGBL) was stable at 4.9%. Total Client
Assets were R$81 billion in 4Q24, up 10% YoY. Assets from
XPV&P, our proprietary insurer, grew 17% YoY, reaching R$66
billion.
3. CARDS
Cards TPV (in R$ billion)
In 4Q24, Total TPV was R$13.1 billion, a 11% growth YoY,
and 9% increase QoQ. For the full year of 2024, Total TPV was
R$47.9 billion, 17% higher compared to 2023.
Active Cards (in ‘000s)
Total Active Cards were 1.4 million in 4Q24, a
growth of 18% YoY and 3% QoQ, being 1.0 million Credit
Cards and 0.4 million Active Debit Cards.
4. CREDIT4
Credit Portfolio (in R$ billion)
Total Credit Portfolio reached R$21 billion as of 4Q24,
expanding 1% YoY and 6% QoQ. Currently, this Credit
Portfolio is 81% collateralized with Investments.
______________________________
4 - From 3Q22 onwards, the credit
portfolio is disclosed gross (versus previously net) of loan loss
provisions, also retroactively, not including Intercompany
transactions and Credit Card related loans and receivables
5. INSURANCE
Gross Written Premiums (in R$ million)
Gross written premiums (GWP) refer to the total amount of
premium income that XPs has written or sold during a particular
reporting period before deductions for provisions, reinsurance and
other expenses. This figure represents the total premiums that
customers have agreed to pay for life insurance policies issued by
the company, or sold by the company and issued by third-party
insurers, including both new policies and renewals. It is a crucial
metric for assessing the total business volume of an insurance
company or insurance broker within that period.
In the 4Q24, Gross Written Premiums grew 37% YoY and
11% QoQ.
Discussion of Financial Results
Total Gross Revenue1
Gross revenue reached R$4.7 billion in 4Q24, reflecting a
4% increase quarter-over-quarter (QoQ) and a 10% increase
year-over-year (YoY). For the full year 2024, gross revenue was
R$18.0 billion, up 15% YoY. Both quarterly and annual growth
were primarily driven by our Retail and Corporate & Issuer
Services.
Retail Revenue
(in R$ mn)
4Q24
4Q23
YoY
3Q24
QoQ
2024
2023
YoY
Retail Revenue
3,569
3,152
13%
3,494
2%
13,489
11,791
14%
Equities
1,001
1,180
-15%
1,059
-5%
4,303
4,444
-3%
Fixed Income
985
690
43%
938
5%
3,447
2,318
49%
Funds Platform
364
334
9%
354
3%
1,390
1,311
6%
Retirement Plans
103
94
10%
100
2%
396
365
8%
Cards
333
306
9%
302
10%
1,245
1,001
24%
Credit
81
46
79%
75
9%
266
180
48%
Insurance
58
46
27%
55
5%
210
149
41%
Other Retail
645
457
41%
611
6%
2,232
2,023
10%
Annualized Retail Take Rate
1.33%
1.27%
6 bps
1.33%
0 bps
1.29%
1.28%
1 bps
Retail revenue reached R$3,569 million in 4Q24, marking a
2% increase quarter-over-quarter (QoQ) and a 13% increase YoY. This
sequential growth was driven by another strong quarterly
performance in Fixed Income, which grew 5% QoQ, and the positive
seasonality of Cards revenue in 4Q24, which was 10% higher QoQ.
However, this was partially offset by a 5% decline in Equities
revenue.
Retail Revenue for 2024 was R$13,489 million,
representing a 14% growth YoY, primarily driven by:
- Fixed Income, which grew 49% supported by strong both
primary and secondary activity, reaching record high volumes.
- Cards, driven by a 17% growth in Total Payment Volume
(TPV).
- Other Retail, driven by FX transactions and Digital
Account growth.
Take Rate
Annualized Retail Take Rate was 1.33% in 4Q24, stable QoQ. In
2024, take rate was 1.29%, 1 bps higher YoY.
Institutional Revenue
Institutional revenue was R$332 million in 4Q24, down 2% QoQ and
20% YoY. For the full year 2024, Institutional Revenue was R$1,373
million, 9% lower than the previous year.
Corporate & Issuer Services Revenue
Corporate & Issuer Services revenue totaled R$599 million in
4Q24, up 9% QoQ and up 18% YoY, with another strong quarterly
contribution from DCM. For the full year of 2024, Corporate &
Issuer Services Revenue was R$2,289 million, 45% higher than
in 2023. This reinforces our strategy to diversify our revenue
stream through our Wholesale Bank demonstrates that XP is well
positioned to continue benefiting from DCM activity in Brazil.
Moreover, after the changes in our corporate structure we have now
a more competitive banking ecosystem for both Retail and Wholesale
activities.
Other Revenue
Other revenue was R$224 million in 4Q24, 49% higher QoQ and 5%
lower YoY. For the full year of 2024, Other revenue was R$2,232
million, 10% higher compared to 2023.
Costs of Goods Sold and Gross Margin1
Gross Margin was 69.3% in 4Q24 versus 68.1% in 4Q23 and 68.1% in
3Q24. Sequential increase in Gross Margin was mainly related to
revenue mix between products and channels in the quarter. For the
full year of 2024, Gross Margin was 68.7%, 69 bps higher than in
2023.
SG&A Expenses1
(in R$ mn)
4Q24
4Q23
YoY
3Q24
QoQ
2024
2023
YoY
Total SG&A
(1,577)
(1,553)
2%
(1,515)
4%
(5,927)
(5,391)
10%
People
(1,087)
(1,022)
6%
(984)
10%
(4,056)
(3,728)
9%
Salary and Taxes
(390)
(393)
-1%
(444)
-12%
(1,664)
(1,510)
10%
Bonuses
(582)
(462)
26%
(405)
44%
(1,844)
(1,705)
8%
Share Based Compensation
(115)
(166)
-31%
(135)
-15%
(548)
(513)
7%
Non-people
(490)
(532)
-8%
(530)
-8%
(1,871)
(1,663)
13%
LTM Compensation Ratio
23.7%
25.1%
-134 bps
24.0%
-24 bps
23.7%
25.1%
-134 bps
LTM Efficiency Ratio
34.7%
36.3%
-157 bps
35.5%
-78 bps
34.7%
36.3%
-157 bps
Headcount (EoP)
7,442
6,669
12%
7,241
3%
7,442
6,669
12%
SG&A expenses totaled R$1.6 billion in 4Q24,
4% higher QoQ, and 2% higher YoY. For the full year
of 2024, SG&A was R$5.9 billion, 10% higher compared to
2023.
Our last twelve months (LTM) compensation ratio5 in 4Q24 was
23.7%, an improvement from 25.1% in 4Q23 and from the 24.0%
in 3Q24. Also, our LTM efficiency ratio6 reached 34.7% in
4Q24, the lowest level since our IPO, reinforcing once again our
focus on cost discipline and efficient expenses management.
Earnings Before Taxes1
EBT was R$1,289 million in 4Q24, up 6% QoQ and up 30%
YoY. EBT Margin was 28.7%. Our EBT Margin was 66 bps lower
QoQ, and 413 bps higher YoY. For the full year of 2024, EBT was
R$4,974 million, up 26% YoY, and EBT Margin was
29.1%, 263 bps higher than in 2023.
Adjusted Net Income and Adjusted EPS1
In 4Q24, Adjusted Net Income reached a record R$1.2
billion, showing a 2% QoQ and a 16% rise YoY. Adjusted Basic
EPS was R$2.25, reflecting a 2% QoQ growth and an 18% YoY increase.
Adjusted diluted EPS was R$2.23 for the quarter, up 19% QoQ and 2%
YoY.
For the full year 2024, adjusted net income also hit a record
high of R$4.5 billion, marking a 17% YoY growth. Adjusted
Basic EPS was R$8.39, up 16% from the previous year, while Adjusted
diluted EPS was R$8.28, also 16% higher YoY.
______________________________
5 - Compensation ratio is calculated as
People SG&A (Salary and Taxes, Bonuses and Share Based
Compensation) divided by Net Revenue.
6 - Efficiency ratio is calculated as
SG&A ex-revenue from incentives from Tesouro Direto, B3, and
others divided by Net Revenue.
Adjusted ROTE1,7 and Adjusted ROAE1,8
We now present Return on Tangible Equity, which excludes
Intangibles and Goodwill. We believe this metric allows a more
meaningful comparison with our peers.
In 4Q24, annualized Adjusted ROTE7 was 29.2%, up 78 bps
QoQ and up 356 bps YoY. Our annualized Adjusted ROAE8 in 4Q24 was
23.4%, up 40 bps QoQ and up 230 bps YoY.
For the full year of 2024, our Adjusted ROTE7 was 28.7%, 376 bps
higher compared to 2023. Our Adjusted ROAE8 was 23.0%, or 164 bps
higher YoY.
Capital Management9
We are enhancing our financial disclosures to include key
capital management ratios, such as the BIS Ratio and Risk-Weighted
Assets (RWA). These metrics will replace the former Adjusted Gross
Financial Assets and Net Asset Value (NAV) metrics, which are no
longer insightful in reflecting our current business
activities.
In 4Q24, after our R$2.1 billion capital return through dividend
and share buybacks, our BIS Ratio was 17.7%, 376 bps lower
QoQ and 249 bps lower YoY. While our total RWA was R$105.8
billion, with a 12% increase QoQ and 35% increase YoY.
______________________________
7 – Annualized Return on Tangible Common
Equity, calculated as Annualized Net Income over Tangible Common
Equity, which excludes Intangibles and Goodwill, net of deferred
taxes.
8 – Annualized Return on Average
Equity.
9 – Managerial BIS Ratio is calculated
using the same methodology as the BIS Ratio for our Prudential
Conglomerate. However, it is based on the total assets and equity
of the entire group.
Other Information
Webcast and Conference Call Information
The Company will host a webcast to discuss its fourth quarter
financial results on Tuesday, February 18th, 2025, at 5:00 pm ET
(7:00 pm BRT). To participate in the earnings webcast please
subscribe at 4Q24 Earnings Web Meeting. The replay will be
available on XP’s investor relations website at
https://investors.xpinc.com/
Important Disclosure
In reviewing the information contained in this release, you are
agreeing to abide by the terms of this disclaimer. This information
is being made available to each recipient solely for its
information and is subject to amendment. This release is prepared
by XP Inc. (the “Company,” “we” or “our”), is solely for
informational purposes. This release does not constitute a
prospectus and does not constitute an offer to sell or the
solicitation of an offer to buy any securities. In addition, this
document and any materials distributed in connection with this
release are not directed to, or intended for distribution to or use
by, any person or entity that is a citizen or resident or located
in any locality, state, country or other jurisdiction where such
distribution, publication, availability or use would be contrary to
law or regulation or which would require any registration or
licensing within such jurisdiction.
This release was prepared by the Company. Neither the Company
nor any of its affiliates, officers, employees or agents, make any
representation or warranty, express or implied, in relation to the
fairness, reasonableness, adequacy, accuracy or completeness of the
information, statements or opinions, whichever their source,
contained in this release or any oral information provided in
connection herewith, or any data it generates and accept no
responsibility, obligation or liability (whether direct or
indirect, in contract, tort or otherwise) in relation to any of
such information. The information and opinions contained in this
release are provided as at the date of this release, are subject to
change without notice and do not purport to contain all information
that may be required to evaluate the Company. The information in
this release is in draft form and has not been independently
verified. The Company and its affiliates, officers, employees and
agents expressly disclaim any and all liability which may be based
on this release and any errors therein or omissions therefrom.
Neither the Company nor any of its affiliates, officers, employees
or agents makes any representation or warranty, express or implied,
as to the achievement or reasonableness of future projections,
management targets, estimates, prospects or returns, if any.
The information contained in this release does not purport to be
comprehensive and has not been subject to any independent audit or
review. Certain of the financial information as of and for the
periods ended of December 31, 2021 and December 31, 2020, 2019,
2018 and 2017 has been derived from audited financial statements
and all other financial information has been derived from unaudited
interim financial statements. A significant portion of the
information contained in this release is based on estimates or
expectations of the Company, and there can be no assurance that
these estimates or expectations are or will prove to be accurate.
The Company’s internal estimates have not been verified by an
external expert, and the Company cannot guarantee that a third
party using different methods to assemble, analyze or compute
market information and data would obtain or generate the same
results.
Statements in the release, including those regarding the
possible or assumed future or other performance of the Company or
its industry or other trend projections, constitute forward-looking
statements. These statements are generally identified by the use of
words such as “anticipate,” “believe,” “could,” “expect,” “should,”
“plan,” “intend,” “estimate” and “potential,” among others. By
their nature, forward-looking statements are necessarily subject to
a high degree of uncertainty and involve known and unknown risks,
uncertainties, assumptions and other factors because they relate to
events and depend on circumstances that will occur in the future
whether or not outside the control of the Company. Such factors may
cause actual results, performance or developments to differ
materially from those expressed or implied by such forward-looking
statements and there can be no assurance that such forward-looking
statements will prove to be correct. These risks and uncertainties
include factors relating to: (1) general economic, financial,
political, demographic and business conditions in Brazil, as well
as any other countries we may serve in the future and their impact
on our business; (2) fluctuations in interest, inflation and
exchange rates in Brazil and any other countries we may serve in
the future; (3) competition in the financial services industry; (4)
our ability to implement our business strategy; (5) our ability to
adapt to the rapid pace of technological changes in the financial
services industry; (6) the reliability, performance, functionality
and quality of our products and services and the investment
performance of investment funds managed by third parties or by our
asset managers; (7) the availability of government authorizations
on terms and conditions and within periods acceptable to us; (8)
our ability to continue attracting and retaining new
appropriately-skilled employees; (9) our capitalization and level
of indebtedness; (10) the interests of our controlling
shareholders; (11) changes in government regulations applicable to
the financial services industry in Brazil and elsewhere; (12) our
ability to compete and conduct our business in the future; (13) the
success of operating initiatives, including advertising and
promotional efforts and new product, service and concept
development by us and our competitors; (14) changes in consumer
demands regarding financial products, customer experience related
to investments and technological advances, and our ability to
innovate to respond to such changes; (15) changes in labor,
distribution and other operating costs; (16) our compliance with,
and changes to, government laws, regulations and tax matters that
currently apply to us; (17) other factors that may affect our
financial condition, liquidity and results of operations.
Accordingly, you should not place undue reliance on forward-looking
statements. The forward-looking statements included herein speak
only as at the date of this release and the Company does not
undertake any obligation to update these forward-looking
statements. Past performance does not guarantee or predict future
performance. Moreover, the Company and its affiliates, officers,
employees and agents do not undertake any obligation to review,
update or confirm expectations or estimates or to release any
revisions to any forward-looking statements to reflect events that
occur or circumstances that arise in relation to the content of the
release. You are cautioned not to unduly rely on such
forward-looking statements when evaluating the information
presented and we do not intend to update any of these
forward-looking statements.
Market data and industry information used throughout this
release are based on management’s knowledge of the industry and the
good faith estimates of management. The Company also relied, to the
extent available, upon management’s review of industry surveys and
publications and other publicly available information prepared by a
number of third-party sources. All of the market data and industry
information used in this release involves a number of assumptions
and limitations, and you are cautioned not to give undue weight to
such estimates. Although the Company believes that these sources
are reliable, there can be no assurance as to the accuracy or
completeness of this information, and the Company has not
independently verified this information.
The contents hereof should not be construed as investment,
legal, tax or other advice and you should consult your own advisers
as to legal, business, tax and other related matters concerning an
investment in the Company. The Company is not acting on your behalf
and does not regard you as a customer or a client. It will not be
responsible to you for providing protections afforded to clients or
for advising you on the relevant transaction.
This release includes Adjustments to Reported Net Income, which
is non-GAAP financial information. We believe that such information
is meaningful and useful in understanding the activities and
business metrics of the Company’s operations. We also believe that
these non-GAAP financial measures reflect an additional way of
viewing aspects of the Company’s business that, when viewed with
our International Financial Reporting Standards (“IFRS”) results,
as issued by the International Accounting Standards Board, provide
a more complete understanding of factors and trends affecting the
Company’s business. Further, investors regularly rely on non-GAAP
financial measures to assess operating performance and such
measures may highlight trends in the Company’s business that may
not otherwise be apparent when relying on financial measures
calculated in accordance with IFRS. We also believe that certain
non-GAAP financial measures are frequently used by securities
analysts, investors and other interested parties in the evaluation
of public companies in the Company’s industry, many of which
present these measures when reporting their results. The non-GAAP
financial information is presented for informational purposes and
to enhance understanding of the IFRS financial statements. The
non-GAAP measures should be considered in addition to results
prepared in accordance with IFRS, but not as a substitute for, or
superior to, IFRS results. As other companies may determine or
calculate this non-GAAP financial information differently, the
usefulness of these measures for comparative purposes is limited. A
reconciliation of such non-GAAP financial measures to the nearest
GAAP measure is included in this release.
For purposes of this release:
“Active Clients” means the total number of retail clients served
through our XP Investimentos, Rico, Clear, XP Investments and XP
Private (Europe) brands, with Client Assets above R$100.00 or that
have transacted at least once in the last thirty days. For purposes
of calculating this metric, if a client holds an account in more
than one of the aforementioned entities, such client will be
counted as one “active client” for each such account. For example,
if a client holds an account in each of XP Investimentos and Rico,
such client will count as two “active clients” for purposes of this
metric.
“Client Assets” means the market value of all client assets
invested through XP’s platform and that is related to reported
Retail Revenue, including equities, fixed income securities, mutual
funds (including those managed by XP Gestão de Recursos Ltda., XP
Advisory Gestão de Recursos Ltda. and XP Vista Asset Management
Ltda., as well as by third-party asset managers), pension funds
(including those from XP Vida e Previdência S.A., as well as by
third-party insurance companies), exchange traded funds, COEs
(Structured Notes), REITs, and uninvested cash balances (Float
Balances), among others. Although Client Assets includes custody
from Corporate Clients that generate Retail Revenue, it does not
include custody from institutional clients (asset managers, pension
funds and insurance companies).
Rounding
We have made rounding adjustments to some of the figures
included in this release. Accordingly, numerical figures shown as
totals in some tables may not be an arithmetic aggregation of the
figures that preceded them.
Unaudited Managerial Income Statement (in R$ mn)
Managerial Income Statement
4Q24
4Q23
YoY
3Q24
QoQ
2024
2023
YoY
Total Gross Revenue
4,725
4,309
10%
4,536
4%
18,035
15,726
15%
Retail
3,569
3,152
13%
3,494
2%
13,489
11,791
14%
Equities
1,001
1,180
-15%
1,059
-5%
4,303
4,444
-3%
Fixed Income
985
690
43%
938
5%
3,447
2,318
49%
Funds Platform
364
334
9%
354
3%
1,390
1,311
6%
Retirement Plans
103
94
10%
100
2%
396
365
8%
Cards
333
306
9%
302
10%
1,245
1,001
24%
Credit
81
46
79%
75
9%
266
180
48%
Insurance
58
46
27%
55
5%
210
149
41%
Other
645
457
41%
611
6%
2,232
2,023
10%
Institutional
332
413
-20%
340
-2%
1,373
1,516
-9%
Corporate & Issuer
Services
599
508
18%
552
9%
2,289
1,576
45%
Other
224
236
-5%
150
49%
884
842
5%
Net Revenue
4,487
4,046
11%
4,319
4%
17,078
14,860
15%
COGS
(1,378)
(1,292)
7%
(1,378)
0%
(5,352)
(4,760)
12%
Gross Profit
3,109
2,753
13%
2,940
6%
11,726
10,100
16%
Gross Margin
69.3%
68.1%
122 bps
68.1%
120 bps
68.7%
68.0%
69 bps
SG&A
(1,567)
(1,539)
2%
(1,454)
8%
(5,755)
(5,368)
7%
People
(1,087)
(1,022)
6%
(984)
10%
(4,056)
(3,728)
9%
Non-People
(480)
(517)
-7%
(470)
2%
(1,699)
(1,639)
4%
D&A
(60)
(82)
-28%
(72)
-17%
(265)
(252)
5%
Interest expense on debt
(196)
(167)
17%
(198)
-1%
(780)
(617)
26%
Share of profit in JV &
Associates
2
30
-92%
(3)
-72%
47
74
-36%
EBT
1,289
995
30%
1,212
6%
4,974
3,936
26%
EBT Margin
28.7%
24.6%
413 bps
28.1%
66 bps
29.1%
26.5%
263 bps
Tax Expense (Accounting)
(79)
45
-276%
(26)
206%
(430)
(37)
n.a.
Tax Expense (Tax
Withholding)10
(185)
(175)
6%
(154)
20%
(613)
(659)
-7%
Effective tax rate
(Normalized)
(17.9%)
(11.1%)
-678 bps
(13.2%)
-474 bps
(18.7%)
(15.1%)
-352 bps
Adjusted Net Income
1,210
1,040
16%
1,187
2%
4,544
3,899
17%
Adjusted Net Margin
27.0%
25.7%
126 bps
27.5%
-51 bps
26.6%
26.2%
37 bps
______________________________
10 - Tax adjustments are related to tax
withholding expenses that are recognized net in gross revenue.
Accounting Income Statement (in R$ mn)
Accounting Income Statement
4Q24
4Q23
YoY
3Q24
QoQ
2024
2023
YoY
Net revenue from services
rendered
1,912
1,881
2%
1,940
-1%
7.425
6.532
14%
Brokerage commission
522
485
8%
576
-9%
2.133
1.992
7%
Securities placement
540
687
-21%
570
-5%
1.743
1.628
7%
Management fees
444
414
7%
446
0%
2.285
1.979
15%
Insurance brokerage fee
58
48
20%
61
-4%
219
175
25%
Commission Fees
317
220
44%
211
50%
997
790
26%
Other services
218
214
2%
241
-10%
734
589
25%
Sales Tax and contributions on
Services
(186)
(187)
0%
(163)
15%
(687)
(622)
10%
Net income from financial
instruments at amortized cost
(887)
311
-386%
(861)
3%
(1.766)
1.573
-212%
Net income from financial
instruments at fair value through profit or loss
3,415
1,854
84%
3,239
5%
11.372
6.756
68%
Total revenue and
income
4,440
4,046
10%
4,319
3%
17.031
14.860
15%
Operating costs
(1,276)
(1,169)
9%
(1,332)
-4%
(5.063)
(4.399)
15%
Selling expenses
(41)
(59)
-30%
(43)
-3%
(149)
(169)
-12%
Administrative expenses
(1,528)
(1,547)
-1%
(1,565)
-2%
(6.001)
(5.461)
10%
Other operating revenues
(expenses), net
3
(14)
-122%
81
-96%
189
11
n.a.
Expected credit losses
(102)
(124)
-17%
(47)
120%
(288)
(361)
-20%
Interest expense on debt
(196)
(167)
17%
(198)
-1%
(780)
(617)
26%
Share of profit in JV &
Associates
2
30
-92%
(3)
-175%
47
74
-36%
Income before income
tax
1,301
995
31%
1,212
7%
4.986
3.936
27%
Income tax expense
(121)
45
-369%
(26)
n.a.
(471)
(37)
n.a.
Net income for the
period
1,181
1,040
14%
1,187
0%
4.515
3.899
16%
Balance Sheet (in R$ mn)
Assets
4Q24
3Q24
Cash
5,611
4,626
Financial assets
321,698
291,996
Fair value through profit or
loss
196,185
167,489
Securities
149,985
133,717
Derivative financial
instruments
46,200
33,773
Fair value through other
comprehensive income
50,880
50,552
Securities
50,880
50,552
Evaluated at amortized
cost
74,633
73,955
Securities
2,836
3,152
Securities purchased under
agreements to resell
22,057
26,153
Securities trading and
intermediation
6,499
2,934
Accounts receivable
779
958
Loan Operations
29,228
27,512
Other financial assets
13,233
13,246
Other assets
10,657
10,743
Recoverable taxes
453
523
Rights-of-use assets
313
347
Prepaid expenses
4,363
4,479
Other
5,528
5,394
Deferred tax assets
2,888
2,572
Investments in associates and
joint ventures
3,519
3,431
Property and equipment
450
435
Goodwill & Intangible
assets
2,634
2,596
Total Assets
347,457
316,400
Liabilities
4Q24
3Q24
Financial liabilities
257,965
228,018
Fair value through profit or
loss
55,301
51,216
Securities
15,253
18,602
Derivative financial
instruments
40,048
32,614
Evaluated at amortized
cost
202,664
176,802
Securities sold under repurchase
agreements
71,780
51,135
Securities trading and
intermediation
18,475
20,040
Financing instruments payable
95,248
90,589
Accounts payables
763
806
Borrowings
1,666
-
Other financial liabilities
14,731
14,231
Other liabilities
69,179
66,781
Social and statutory
obligations
1,311
751
Taxes and social security
obligations
418
508
Retirement plans liabilities
66,224
64,126
Provisions and contingent
liabilities
146
135
Other
1,080
1,262
Deferred tax
liabilities
265
243
Total Liabilities
327,410
295,042
Equity attributable to owners
of the Parent company
20,044
21,353
Issued capital
0
0
Capital reserve
20,940
18,401
Other comprehensive income
(674)
(265)
Treasury
(222)
(117)
Retained earnings
-
3,333
Non-controlling
interest
4
5
Total equity
20,047
21,358
Total liabilities and
equity
347,457
316,400
Reconciliation of Adjusted Net Income
Adjusted Net Income is a financial measure that reflects the
company’s net income, excluding certain non-recurring or non-cash
items that management believes do not reflect the company’s core
operating performance. In the current period, this includes
adjustments related to social charges and deferred tax assets
associated with Performance Stock Units (PSUs) that expired
unvested.
These adjustments exclude accounting charges that neither impact
cash flow nor reflect recurring earnings volatility. By removing
these effects, Adjusted Net Income provides a more accurate view of
the company’s underlying profitability.
Additionally, Adjusted Revenue (+R$47mm) and Adjusted SG&A
(-R$59mm) also resulted in an Adjusted EBT. These financial
measures exclude certain items that management believes are not
indicative of the company’s core operating performance. These
adjustments relate to one-off impacts from hedging social charges
associated with share-based compensation expenses.
By excluding these items, Adjusted Revenue and Adjusted Expenses
offer a more accurate representation of the company’s recurring
operating results, facilitating comparability across reporting
periods.
(in R$ mn)
4Q24
4Q23
YoY
3Q24
QoQ
2024
2023
YoY
Net Income
1,181
1,040
14%
1,187
-1%
4,515
3,899
16%
Hedge of Social Charges
47
-
-
-
-
47
-
-
Social Charges / Hedge of Social
Charges
(59)
-
-
-
-
(59)
-
-
Tax Expenses
41
-
-
-
-
41
-
-
Adjusted Net Income
1,210
1,040
16%
1,187
2%
4,544
3,899
17%
View source
version on businesswire.com: https://www.businesswire.com/news/home/20250218032943/en/
Investor Relations Contact ir@xpi.com.br
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