PagSeguro Digital Ltd (PAGS) Q1 2025 Earnings Call Highlights: Record Payment Volume and ...

GuruFocus News

Wed, May 14, 2025, 6:00 PM 3 min read

Release Date: May 13, 2025

For the implicit transcript of the net call, delight notation to the full net telephone transcript.

• PagSeguro Digital Ltd (NYSE:PAGS) reported a beardown 4th with a 16% year-over-year maturation successful full outgo measurement (TPV), reaching a grounds 129 cardinal reais.

• The institution achieved a 13% year-over-year summation successful nett revenues, totaling 4.9 cardinal reais.

• PagSeguro Digital Ltd (NYSE:PAGS) announced the motorboat of a currency dividend of $0.14 per communal share, marking the archetypal dividend outgo successful the company's history.

• The banking segment's gross nett borderline reached 70%, marking its 5th consecutive 4th of maturation and present represents 22% of the full gross profit.

• The institution successfully reduced its outgo of funding, with the mean full deposit outgo decreasing by 700 ground points to 90% of the CDI.

• TPV maturation decelerated from 28% successful the erstwhile 4th to 16% year-over-year, partially owed to challenging comparisons and repricing strategies.

• The institution faced a 42% summation successful fiscal costs, driven by higher involvement rates and TPV growth, which required larger pre-payment volumes.

• Operating expenses decreased by lone 3% 4th implicit quarter, indicating constricted cost-cutting measures.

• There was a contraction successful deposits during the quarter, attributed to the higher outgo of accidental owed to the elevated involvement complaint environment.

• The institution acknowledged imaginable churn successful the MSMB conception owed to repricing, which could interaction aboriginal growth.

• Warning! GuruFocus has detected 6 Warning Signs with PAGS.

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Q: What explains the deceleration successful TPV maturation from 28% successful Q4 to 16% successful Q1? A: Ricardo Lutra, Principal Executive Officer, explained that the deceleration is partially owed to a hard examination with Q1 2024, which had higher volumes. The absorption remains connected winning MSMBs and online segments, with ample retail being much delicate to repricing owed to involvement complaint hikes. The institution is balancing maturation and profitability, with immoderate clients moving volumes to different companies owed to repricing.

Q: Why is the dividend organisation lone 10% of nett income, fixed the company's beardown superior position? A: Ricardo Lutra, Principal Executive Officer, stated that the 10% dividend is portion of a combined inaugural with stock buybacks. The institution has been assertive successful buybacks, purchasing implicit 1.1 cardinal reais successful shares implicit the past 12 months. The dividend percent is simply a starting constituent and could alteration successful the future.