Stone doubles customer base and points to increased profitability in 2022

Rhea-AI Summary

StoneCo Ltd. (Nasdaq: STNE) reported an impressive 87% revenue growth in Q4 2021, totaling R$ 1.9 billion, and doubled its active customer base to 1.8 million. Despite increased financial expenses affecting margins, the company anticipates enhanced profitability in Q1 2022, with revenue projections of R$ 1.9 billion, an increase of 119%. The reorganization into Financial Services and Software segments aims to strengthen cross-selling opportunities. Adjusted earnings before taxes are expected to exceed R$ 140 million.

Positive

• Revenue grew 87% in Q4 2021 to R$ 1.9 billion.
• Active customer base increased to 1.8 million, up 2.3 times from 2020.
• Projected revenue for Q1 2022 is R$ 1.9 billion, an anticipated growth of 119%.
• Adjusted earnings before taxes expected to exceed R$ 140 million in Q1 2022.
• TPV for MSMEs projected to reach R$ 60 billion, an increase of up to 83%.
• Successful implementation of repricing strategy led to an increase in take rate from 1.71% to 2.02%.

Negative

• Margins were impacted by higher financial expenses.

Total revenue grew 87% in the period, to R$ 1.9 billion

Guidance for Q122 points to increasing profitability and total revenue

SÃO PAULO, March 18, 2022 /PRNewswire/ -- StoneCo Ltd. (Nasdaq: STNE) recorded growth acceleration in the 4^th quarter of 2021. Revenue grew by 87% compared to the last quarter of 2020, reaching R$ 1.9 billion. The Company invested in expanding its base and closed 2021 with 1.8 million active customers – 2.3 times more than in 2020.

Margin was impacted by higher financial expenses, and adjusted net income was R$ 34 million in the quarter. The company has successfully implemented its repricing strategy and expects to increase profitability in the first quarter of 2022.

"The fundamentals of the business remain solid. We are gaining customers, gaining market share and expanding our presence for the company's continued expansion", says Stone CEO Thiago Piau.

With the price revision, the take rate in Micro, Small and Medium Enterprises increased from 1.71% in Q421 to 2.02% in January – surpassing the 1.68% rate (ex-credit) in Q420. MSME TPV growth has already increased by more than 80% in January and February, pointing to a balance between growth and margin.

With investments in products and operations, the expectation is that total revenue will be close to R$ 1.9 billion in the first quarter, up 119%; and the TPV of MSMEs could reach R$ 60 billion, with an up to 83% increase. Adjusted earnings before taxes are expected to exceed R$ 140 million in Q122.

The last quarter of 2021 also saw growth in banking, which closed the year with 491,500 active customers and more than R$ 2 billion in deposits.

In Software, revenue rose by 16% over the last quarter of 2020, and revenue from core POS and ERP solutions increased by 26%. Linx reached 109,300 establishments with POS/ERP solutions, in an 11.7% increase in the quarter.

To provide greater focus on executing its strategies, Stone reorganized the company into two segments: Financial Services and Software. Each unit will have a dedicated COO, who will look for cross-selling and integration opportunities.

The company will continue to expand its customer base and is focused on relaunching the credit product, which is key to its mission of supporting Brazilian entrepreneurs.

View original content:https://www.prnewswire.com/news-releases/stone-doubles-customer-base-and-points-to-increased-profitability-in-2022-301505892.html

SOURCE Stone

FAQ

What was StoneCo's revenue growth in Q4 2021?

StoneCo reported a revenue growth of 87% in Q4 2021, reaching R$ 1.9 billion.

How many active customers did StoneCo have at the end of 2021?

StoneCo closed 2021 with 1.8 million active customers, 2.3 times more than in 2020.

What is the expected revenue for StoneCo in Q1 2022?

StoneCo expects total revenue in Q1 2022 to be around R$ 1.9 billion, marking a 119% increase.

What adjustment did StoneCo make to its take rate?

StoneCo's take rate increased from 1.71% in Q4 2021 to 2.02% in January 2022.

What are the projected earnings before taxes for StoneCo in Q1 2022?

Adjusted earnings before taxes for StoneCo are expected to exceed R$ 140 million in Q1 2022.