PagSeguro, the Brazilian company specializing in digital payment methods, recently announced its results for the fourth quarter of 2022, registering a net profit of $78 million — representing a 35% increase compared to the same period of the previous year.
The annual result reached $307 million, up 12% over 2021, meeting estimated guidance. This was the highest annual result in the company’s history.
“Our discipline in controlling costs, expenses, and investments has put us in a unique position to be one of the few profitable fintechs since the IPO and to close 2022 with a robust cash position, even with two years of pandemic and a significant interest rate hike cycle,” says Artur Schunck, CFO of PagBank PagSeguro, in a statement.
The Total Payment Volume (TPV) processed by the payments area of PagSeguro was $18 billion in the fourth quarter, an increase of 19% compared to the same period last year. In financial services, it processed $22 billion, up 68% year-on-year.
A more significant share in the Brazilian digital payments market
While the industry grew 25% in the period in Brazil, PagSeguro says it gained a 1.2% market share.
“We are the most complete digital bank in the country, operating in two business verticals: financial services and payment platform. Our product portfolio includes cards, credit offers, investments, insurance, Pix, bill and tax payments, automatic debit, and cell phone recharging, among others,” says Alexandre Magnani, CEO of PagBank PagSeguro, in a statement.
“We also have the largest payment acceptance network in Brazil, which includes offers for POS machines, online payments, Pix QR code, software solutions for business management, and cross-border payments. In addition, we invest in clear and massive communication in all media,” he concludes.
Growth boosted by credit portfolio
On the other hand, PagSeguro’s credit portfolio reached $519 million in the fourth quarter of 2022, a growth of 43% compared to the same quarter of 2021. According to the company, this growth was primarily supported by the launch of payroll loan products.
“Regarding the credit portfolio, we grew expressively in secured products, reaching 40% of the portfolio in 4Q22, with the products of payroll loans, Guarantee Fund for Employee’s anniversary withdraw and credit card with limits tied to account reserves or Bank Deposit Certificates from PagBank, a product developed in house and thought for our audience,” the executive added.
“In the last year, we were again able to balance growth with profitability, and we expect to accomplish the same feat in 2023. We are a Brazilian technology company serving Brazilians. We continue to develop and enhance our complete and integrated ecosystem, providing payment solutions and financial services to entrepreneurs and consumers in a simple, secure, and affordable way,” concludes PagBank PagSeguro’s CEO.
By December 2022, the company had 28 million customers, making it the second-largest digital bank in Brazil.
On Friday 3, after news of the fintech’s Q4 profit jump hit Wall Street, PagSeguro shares on the New York Stock Exchange were up 9.1% at $9.23 each. The company’s stock had come from a 14% decline in February and a 2.4% loss in March’s first two trading sessions.