Inter & Co. Inc. Q1 Earnings Call Highlights

Key Points

• Strong profitability and revenue momentum: Inter reported nearly BRL 400 million in Q1 net income (BRL 1.6 billion annualized), with record metrics like ROE 15.5% and revenues up 37% YoY to BRL 4.3 billion, while NIM (disclosed as NIM 2.0) was 9.54% and management expects NIM to expand roughly 10–20 bps per quarter on average.
• Robust client and loan growth but rising credit costs: The bank reached 44 million clients with a ~60% activation spike and BRL 1.7 trillion payments run-rate (+25% YoY); the loan book neared BRL 50 billion (+33% YoY) across mortgages, payroll and cards, while NPLs rose to 5.1% and management now guides cost of risk closer to ~6% for the remainder of the year.
• Product and monetization push with AI launch: Inter introduced Seven, a multi-agent transactional AI tool aimed at driving conversational sales and transactions, as fee revenue and ARPAC climbed (fees +18% YoY, ARPAC BRL 34), even as expenses rose 20% and the efficiency ratio improved to a record-low 43.8%.

Inter & Co. Inc. NASDAQ: INTR executives used the company’s first-quarter 2026 earnings call to emphasize what Global CEO João Vitor Menin described as “a strong start of the year,” pointing to continued growth in the client base, payments volumes, and the loan book, alongside expanding profitability. The call also highlighted Inter’s latest product launch, a multi-agent artificial intelligence tool called Seven, and included detailed discussion with analysts on credit quality trends, cost of risk expectations, and the outlook for net interest margin (NIM).

Profitability and scale metrics

Menin said Inter’s “structural profitability is taking shape,” noting net income of “almost BRL 400 million” in the quarter, which he framed as a BRL 1.6 billion annualized run rate. CFO Santiago Stel later reported net income of BRL 395 million, with record profitability metrics including 15.5% return on equity (ROE) and 1.59% return on assets (ROA). He added that Inter introduced return on tangible equity as a new metric this quarter, at 19.5%.

Stel said gross revenues surpassed BRL 4.3 billion, up 37% year-over-year, while total net revenue rose 33% to BRL 2.4 billion. According to Stel, net interest margin (using what he called “NIM 2.0” as the primary disclosed metric going forward) was 9.54%, the “second best on record,” only 3 basis points below fourth-quarter 2025.

Client growth, engagement, and payments volume

Brazil CEO Alexandre Riccio said Inter reached 44 million total clients and posted its “highest quarterly jump in activation rate since 2024,” at nearly 60%. He said Inter is focused on increasing “principality” (becoming the primary bank for users) through cross-sell and higher monetization while keeping customer acquisition cost “deliberately disciplined.”

Riccio said client engagement translated into higher transaction volumes, with combined cards and Pix volume reaching a BRL 1.7 trillion run-rate in the quarter, a 25% year-over-year increase. He also stated that 8.5% of Pix transactions in Brazil “flow through Inter.”

Loan growth, mix, and asset quality discussion

Inter’s executives repeatedly pointed to continued credit growth. Menin cited a gross loan portfolio “scaled to more than BRL 50 billion,” while Stel said the loan portfolio “nearly reached BRL 50 billion,” up 33% year-over-year. Excluding the SME portfolio, Stel said growth would be 37% year-over-year.

Stel broke out growth by product, reporting:

• Mortgages up 42% year-over-year and home equity up 43%
• Payroll and personal loans up 38% year-over-year, with private payroll highlighted
• Credit cards up 27% year-over-year

Riccio said nearly 70% of the loan portfolio is secured with collateral, describing a strategy balanced across mortgages, payroll loans, and credit cards. He added that Inter’s private payroll loan portfolio reached BRL 2.5 billion with 600,000 active clients. He also said Inter’s credit card “reshaping” effort increased the share of interest-earning portfolios to over 25% from 21% last year, with revolving balances growing as clients were no longer “mandatorily moved to installments.”

On asset quality, Stel said non-performing loans (NPLs) rose to 5.1% from 4.7%, citing three drivers: macro pressures as system delinquency rises, first-quarter seasonality, and portfolio effects from growth in private payroll and credit card reshaping. He said NPL and Stage III formation were “stable” versus the prior quarter, while cost of risk increased as private payroll loans stayed on the books longer.

Guidance themes: cost of risk and NIM expectations

In the Q&A, Citi’s Gustavo Schroden questioned recurring deterioration in credit metrics and sought more detail on private payroll dynamics. Menin argued that Brazil’s tougher credit cycle can create opportunity for Inter due to what he described as a strong funding franchise and lower-cost digital distribution. He said that positioning should allow Inter to keep expanding, with emphasis on secured lending alongside controlled unsecured growth.

Stel said private payroll delinquency is behaving as expected for an early-stage product, and that Inter saw record originations after adding WhatsApp distribution. He described operational improvements, including the ability to move contracts when clients switch employers and smoother employer collections, and referenced additional potential enhancements tied to severance funds and FGTS collateralization.

Stel also addressed profitability and timing for the product, stating that at current delinquency levels, “the ROE of the product at the rates at which we are originating are around 30%.” He said the product’s “natural J-curve” involves upfront provisioning before interest income builds, and that Inter “passed the break-even point a quarter ago.” In follow-up, he said a typical cohort reaches break-even in “around two quarters or six months.”

Schroden also asked about Inter’s cost of risk outlook. Stel said the company now expects something “closer to 6%” for the remainder of the year, compared with prior expectations of 5% to 5.5%, attributing the shift to the current scenario and continued exposure to private payroll and credit card reshaping. In response to Goldman Sachs’ Tito Labarta, Stel said the NPL increase was “roughly half and half” seasonality versus internal factors, with private payroll growth and credit cards as the main internal contributors.

On NIM, BTG Pactual’s Ricardo Buchpiguel asked what to expect in coming quarters. Stel reiterated that Inter expects NIM to expand 10 to 20 basis points per quarter on average over time and said the first quarter’s near-flat quarter-over-quarter performance was driven largely by seasonality on the funding side, contrasting with the more favorable fourth quarter. He said Inter still expects further NIM expansion, “closer to around 10 basis points on average” in the quarter, and pointed to initiatives on the treasury front.

Fees, expenses, and new AI product launch

Stel said net fee revenue grew 18% year-over-year, and he linked fee generation to Inter’s ecosystem of “seven verticals and 180 products.” He reported net ARPAC of BRL 34, up 9% year-over-year, and margin per active client of BRL 21, up 15% year-over-year. He also said mature clients generate more than BRL 130 in gross ARPAC.

JPMorgan’s Yuri Fernandes questioned fee momentum, and Riccio acknowledged “pressure on fees” while noting positive highlights such as Intershop growing 30% year-over-year. Riccio said Inter expects interchange growth to improve from 16% over the last 12 months to “closer to 20%, +20%,” and said additional product launches—citing insurance as an example—could support growth. He also tied future fee opportunities to “Seven efforts” and what he described as “conversational sales.”

On expenses and efficiency, Bank of America’s Mario Pierry pressed management on personnel expense growth and why Inter’s efficiency ratio remains higher than peers. Stel had reported a record-low efficiency ratio of 43.8%, improving 170 basis points sequentially, while also saying expenses rose 20% year-over-year versus 33% revenue growth. Menin responded that Inter is “still a growth story” and highlighted that headcount remained around 4,000 employees while revenue doubled versus roughly 2.5 years ago, attributing that to higher revenue per employee and investments in more senior talent to strengthen underwriting, collections, and innovation.

Menin also used prepared remarks to announce Seven, which he described as a “multi-agent AI tool” and “fully transactional” platform. He said it can handle tasks such as investment guidance, Pix transfers via text, gift card purchases, and managing credit card installments, adding that Inter’s AI has evolved “from simply answering questions to actually getting things done.” Menin framed the company’s direction as part of what he called a “banking AI revolution,” drawing parallels to Inter’s earlier shift to a mobile-only digital bank.

Management repeatedly encouraged investors to attend Inter’s Owner’s Day event at Nasdaq on May 11, where executives said they plan to expand on strategy topics including client principality, credit penetration, monetization, and AI initiatives.

About Inter & Co. Inc. NASDAQ: INTR

Inter & Co, Inc Is a holding company, which engages in the provision of financial products and services. It operates through the following segments: Banking, Securities, Insurance Brokerage, Marketplace, Asset Management, Service, and Other. The Banking segment offers checking accounts cards, deposits, loans and advances, and other services through mobile application. The Securities segment is involved in the acquisition, sale and custody of securities, the structuring and distribution of securities in the capital market, and the provision of administration services to investment funds.

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