XP Inc. Class A Common Stock 2026 Q2 Earnings Call

Good evening, everyone. I'm Andre Parise, Investor Relations Officer at XP Inc. Welcome, and thank you for joining us for our second quarter 2026 earnings call. Today's presentation will be delivered by our CEO, Thiago Maffra, and our CFO, Gustavo Alejo. Right after the presentation, they will be both available for the Q&A session. To ask a question during Q&A, your questions in the order they are received. Live translation in Portuguese is available. You can enable it by clicking the button below. Before we begin, please take a moment to review the legal disclaimer on page 2 of today's presentation, which addresses forward-looking statements. The full presentation is available for download on our Investor Relations website, and you will find additional materials in the SEC Filings section of our IR website. Now I hand it over to Thiago Maffra.

Good evening, Maffra. Thank you, Andre.

Good evening, everyone, and thank you for joining our second quarter 2026 earnings call. I would like to begin by welcoming Gustavo Alejo, our new CFO. He joins us at an exciting time, just after the biggest EXPERT in our history, an event that showed how far we have come and how much further we aim to go. Now, let's dive into our second quarter 2026 numbers. Beginning with the key highlights of the quarter, client assets combining AUM and AOA reached BRL 2.2 trillion, representing a 17% year-over-year growth. We ended the period with 184,000 advisors, up 1% year over year, while our active client base totaled 4.8 million, a 1% increase year over year. Gross revenues amounted to BRL 5.1 billion this quarter, up 8% from the same period last year.

EBT advanced 15% to BRL 1.6 billion, while net income came to BRL 1.4 billion, rising 5% year over year. In terms of profitability, our ROE increased 80 basis points sequentially to 22.5%. Our capital ratio stood at a comfortable 20.3%, reflecting our ability to grow while maintaining disciplined capital and risk management. Also, our EPS grew 9% year over year, stronger than our net income growth, thanks to our capital management and payout strategy. The second quarter of 2026 was again marked by ongoing global geopolitical tensions and residual market volatility. While these headwinds materialized with less intensity than in the previous quarter, they still impacted our results, particularly through the widening of credit spreads and a reduction in primary DCM offerings. Without these effects, we would have achieved double-digit revenue growth with a low teens expansion year over year.

This demonstrates that despite the market volatility we faced in the first half of the year, our core businesses continued to perform well with resilient underlying momentum. Towards the end of the quarter, we began to see signs of normalization across markets, along with a gradual recovery in the fixed income pipeline. We expect this pipeline to materialize into primary offerings over the coming quarters, depending on the market dynamics. That said, depending on how these dynamics evolve, we continue to target double-digit growth throughout 2026, supported by stronger execution across key verticals and a more diversified revenue base. This quarter, we continued to launch products for both individuals and businesses, and our ecosystem is becoming more complete every day.

We have a clear ambition to be the investment leader in Brazil by 2033, but that leadership will come hand in hand with increasing completeness in everything we offer to our clients. This next growth phase is built on personalized service with a focus on financial, tax, and succession planning. Our goal is simple, to be our client's CFO, covering their full spectrum of financial service needs. Moving on to the next slide, let's take a look at client assets. During the second quarter of 2026, our total client assets, combined with assets under management from our asset management business and AOA from our fund administration business, totaled approximately BRL 2.2 trillion, representing 17% growth year-over-year. On the right side of this slide, you can see how net new money has evolved.

In the second quarter of 2026, we again met our soft target of BRL 20 billion in retail net new money, while corporate and institutional inflows came in at BRL 8 billion. Altogether, net new money amounted to BRL 28 billion for the period. While we posted positive results and met our soft guidance, we continue to navigate a challenging environment in 2026. We are constantly improving our investment platform and, as we have mentioned, enhancing the client experience through numerous initiatives. This combination reinforces our confidence in achieving our ambition of roughly BRL 20 billion in retail net new money per quarter on average. Related to that, it's worth mentioning that our NPS ended the second quarter at 66 points. As mentioned in our previous earnings call, we are on a consistent recovery path from the one-off events that impact us in former quarters.

This demonstrates the strength of our brand and the trust clients place in our platform, and it gives us an indication that we will return to historical levels over the next quarters. With that, let's now take a deeper dive into the strategic drivers that are shaping our next growth phase. Our comprehensive financial ecosystem is built around long-term relationships. We provide service and personalized advice with excellence across every aspect of our clients' financial lives, from investments to banking solutions. Many of our clients have needs well beyond investments, and our mission is to provide them with complete solutions. Under this model, the focus shifts from product distribution to building a personalized financial strategy for each investor. Looking ahead, we see the role of the investment advisor at XP undergoing a profound transformation.

The professional is no longer just an intermediary of financial products, but is taking on a role closer to that of a wealth consultant, broadly accompanying clients throughout their financial journey. Given this context, it's crucial to understand personal and family goals, such as retirement and long-term wealth building. The same client centricity logic that guides us on offerings from individuals also extends to our corporate clients. We have recently launched new initiatives targeting the business segment, always focused on delivering financial management solutions. We already have a very robust corporate segment, and now we are expanding our offering, particularly for small and medium-sized enterprise. As we have said over the past few quarters, XP is uniquely positioned for this new market environment.

We have the largest and most qualified advisor network in Brazil, along with a trusted brand and an innovative DNA, a combination that enables our tech lead scaling and keeps us ahead of the market. On the next slide, we share further details on our strategy. Across every client segment we serve, our ambition is to deepen relationships, enhance the completeness of our product offering, and fully meet all of our clients' financial needs. On the individuals side, our focus remains on investments. We continue to deepen our segmentation, offering a specific value proposition for each client layer. We were the first to address a latent market demand and offer a truly model-agnostic approach. Today, we have evolved this concept into a comprehensive wealth planning model, one that allows us to cover our clients across all their financial needs, from investment allocation to estate planning, succession, and beyond.

Under this model, the charging structure naturally aligns as a fee basis, which continues to gain traction. We already have slightly more than 26% of our clients' assets under this framework. On top of that, we are expanding our offshore investment capability and making continued progress on new product launch, including ETFs and managed portfolios, all fully aligned with our way of serving clients. At the same time, we are adding credit to a solution shelf that has already expanded meaningfully over the past few years, during which we introduced numerous innovations in banking and insurance. I would like to emphasize that this expansion is the continuation of a well-planned strategy, one that has been consistently executed over the years with the addition of services and solutions.

For businesses, the same logic holds true, and this is where we see the greatest opportunity since these companies and their founders have long been underserved by traditional players. We plan to change that by delivering a complete, modern, and a scalable offering. Just as we transformed the investment landscape for individuals, we are now about to do the same for businesses. We will introduce a new standard of high-quality advice, supported by technology and a complete range of products and services designed to tackle the real pain points of a market that has never been fully served. By advising these entrepreneurs with the same depth we bring to individuals, we can help them manage and allocate their cash flow more effectively to grow their businesses. We are now expanding and upgrading our commercial coverage while launching new features for businesses.

We recently announced a partnership for a POS device and a credit card geared toward small and medium-sized enterprise. These are natural extensions of our franchise and a continuation of our strategy that has been underway since 2019, when we obtained our banking license. Finally, I want to emphasize that we are executing this strategy with the utmost discipline, ensuring that every step we take remains firmly aligned with our capital ratios and conservative risk approach. With that, I will now hand the call over to Alejo to cover the financial section on the presentation.

Thank you, Maffra. It's a pleasure to be here with all of you today. I would like to begin by expressing my sincere appreciation for the warm welcome since joining XP. I'm thrilled to be part of this journey, and I'm looking forward to contributing to our next chapter of growth. Now, let me walk you through our financial performance for the quarter. Total gross revenue in this second quarter 2026 reached BRL 5.1 billion, up 8% year-over-year and 3% quarter-over-quarter. Retail growth in the quarter was driven by equities, funds platform, new verticals, and other retail, which expanded at a rapid pace year-over-year. The wholesale bank division also delivered consistent growth, led by solid performance of our corporate segments. Now, let's move on to retail revenue.