Nu Holdings (NYSE:NU) opened Q1 2026 with total revenue of US$1.98 billion and basic EPS of US$0.18, setting a clear marker for its latest quarter at a share price of US$12.19. Over the past year, the company has seen revenue move from US$1.38 billion in Q1 2025 to US$1.98 billion in Q1 2026, while basic EPS moved from US$0.12 to US$0.18 over the same period, framing a steadily larger profit pool for shareholders. Taken together with trailing net income of US$3.18 billion and a reported net profit margin of 41.9%, this earnings update puts the focus squarely on how durable those margins look against the growth story.

See our full analysis for Nu Holdings.

With the latest figures on the table, the next step is to see how these results line up with the widely held narratives around Nu Holdings, both on the upside and around the key risks investors are watching.

41.9% net margin and US$3.2b trailing earnings

• On a trailing 12 month basis, Nu generated US$3.2b of net income (excluding extra items) on US$7.6b of revenue, which works out to a 41.9% net profit margin compared with 38.1% a year earlier in the dataset.
• Consensus narrative points to rising digital adoption and product expansion as long term drivers of topline and profit, yet the current 41.9% margin and US$0.66 of trailing EPS sit alongside expectations that margins shrink to around 18.4% in future. In other words, you are comparing very strong recent profitability with models that already assume this level does not last forever.
  • Analysts in the dataset expect earnings growth of about 19.9% a year and revenue growth of about 42.9% a year, which supports the idea of continued scale even as margins are modelled lower.
  • Earnings growth of 48% over the last year backs the view that Nu has converted its digital user growth into profits so far, but the assumed margin step down in the consensus narrative shows that not all of that strength is treated as permanent.

Loan book reaches US$37.2b with 7.9% bad loans

• At Q1 2026, total loans stood at US$37.2b and reported non performing loans were US$3.0b, which is 7.9% of the book and is flagged in the data as a high bad loan ratio.
• Bears focus on Nu’s push into mass market and less mature credit segments, and the 7.9% non performing loan ratio gives that concern something concrete to point to. At the same time, bears also acknowledge that diversified products and risk models could help manage credit cycles.
  • The loan book has grown from US$24.1b in Q1 2025 to US$37.2b in Q1 2026, while non performing loans increased from US$2.0b to US$3.0b over the same period, so credit quality is clearly a key swing factor for how investors read this growth.
  • Bearish narrative worries about higher loss allowances and compressed risk adjusted margins line up with this 7.9% bad loan ratio, but the presence of secured lending and AI based credit tools in the story shows there are also tools being used to try to contain those risks.

On a quarter where credit metrics sit in the spotlight, skeptics may want to see how their concerns stack up against detailed bear case arguments in the 🐻 Nu Holdings Bear Case.

P/E of 18.6x versus richer growth and margin story

• The stock is trading at about US$12.19 with a trailing P/E of 18.6x, above the 13.7x peer average and 11.1x for the US Banks industry in the dataset, while the provided DCF fair value is US$15.94 and the allowed analyst price target figure is US$19.54.
• Bulls argue that Nu’s growth profile justifies paying a higher multiple, and the combination of 48% trailing earnings growth, a 41.9% net margin, and forecasts of faster growth than the broader US market gives clear numerical backing to that argument even though the valuation premium versus peers is also very visible.
  • With earnings forecast in the data to grow around 19.9% a year and revenue about 42.9% a year, the bullish view sees the 18.6x P/E and share price below both US$15.94 DCF fair value and the US$19.54 target as a potential mismatch between price and the growth and margin profile.
  • At the same time, the higher P/E relative to banks at 11.1x means the stock already carries a premium, so bulls need to stay comfortable that earnings quality and growth rates implied by the trailing US$3.2b of net income can remain attractive over time.

If you want to see how bullish investors connect these growth rates, margins, and valuation gaps into a full story, check out the 🐂 Nu Holdings Bull Case

Next Steps

To see how these results tie into long-term growth, risks, and valuation, check out the full range of community narratives for Nu Holdings on Simply Wall St. Add the company to your watchlist or portfolio so you'll be alerted when the story evolves.

Seen enough to sense both optimism and concern around Nu Holdings, but still on the fence? Take a moment now to test the numbers, pressure check the assumptions, and weigh the 4 key rewards and 2 important warning signs.

See What Else Is Out There

High non performing loans at 7.9% and a premium 18.6x P/E versus banking peers indicate that credit risk and valuation are key weak spots for Nu.

If that mix of a richer multiple and elevated credit risk leaves you cautious, take a few minutes to hunt for steadier ideas with the 66 resilient stocks with low risk scores.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.