• Square (Block Inc.) for Brazilian small businesses
• A Brazilian version of Square

• Payment Processing Solutions: Provides physical POS terminals (card machines) and online payment gateways for businesses to accept various forms of payment.
• Digital Banking & Financial Services: Offers digital accounts, debit cards, prepaid cards, and other core banking functionalities tailored for merchants.
• Credit & Lending Solutions: Extends working capital loans and other credit facilities to small and medium-sized businesses.
• Business Management Software: Supplies integrated software solutions, including ERP and POS systems, to help merchants manage their operations efficiently.

StoneCo (STNE) primarily sells its payment processing, banking, and credit solutions to other businesses.

However, due to the nature of its business model, which focuses on serving a vast and fragmented market of small and medium-sized enterprises (SMEs) and individual entrepreneurs across Brazil, StoneCo does not have "major customers" in the traditional sense of a few large, identifiable companies contributing a significant portion of its revenue. Its strategy involves acquiring a large volume of diverse merchants rather than relying on a handful of large corporate clients.

Instead, StoneCo's customer base consists of a broad range of businesses. These business customers can be broadly categorized as:

• Small and Medium-sized Businesses (SMBs): This is StoneCo's core customer segment, encompassing a wide array of enterprises such as retail stores (e.g., clothing boutiques, supermarkets, pharmacies), service providers (e.g., hair salons, clinics, repair shops), restaurants, and other local businesses that require payment acceptance solutions (POS terminals, e-commerce gateways) and financial services like credit and digital banking.
• Micro-merchants and Individual Entrepreneurs: This category includes self-employed professionals, freelancers, street vendors, and very small businesses or independent contractors who utilize StoneCo's more basic payment solutions (like mobile POS devices) and digital financial tools.
• Integrated Platforms and Software Houses: While not direct end-customers in the same way as merchants, StoneCo also partners with and provides its payment infrastructure and APIs to other software companies and e-commerce platforms. These partners then integrate StoneCo's solutions into their offerings, effectively enabling their own merchant customers to use StoneCo's services.

• Amazon Web Services (AWS) - AMZN
• Microsoft Azure - MSFT

Pedro Zinner, Chief Executive Officer

Pedro Zinner became the CEO of StoneCo no later than March 31, 2023, succeeding Thiago Piau. Prior to joining StoneCo, he served as the CEO of Eneva, a prominent power-generation company in Brazil, from 2017 to November 2022. During his leadership at Eneva, the company experienced significant growth and efficiency improvements, with its installed capacity increasing by over 186% and its Return on Equity (ROE) rising from 1.5% to 17.3%. He brings over 25 years of management and leadership experience in strategy, risk management, and finance from his time at Eneva, BG Group, and Vale. He also served as a Board member of StoneCo before assuming the CEO role.

Mateus Scherer Schwening, Chief Financial Officer & Investor Relations Officer

Mateus Scherer Schwening was appointed Chief Financial Officer and Investor Relations Officer (IRO) effective July 1, 2023. He has been with StoneCo since 2015, contributing significantly in various finance capacities, including serving as Vice President of Finance since April 2022. As a partner at StoneCo, he was responsible for Treasury, Capital Allocation, and Strategic Projects related to new investments, mergers and acquisitions, and capital raises. Before his tenure at StoneCo, he worked as an equity analyst for Nucleo Capital from 2013 to 2015. He also held a position on StoneCo's Board of Directors from May 2021 through April 2022 and served on the Finance Committee.

Lia Machado de Matos, Chief Strategy and Marketing Officer

Lia Machado de Matos has been the Chief Strategy and Marketing Officer at Stone since April 2015. In this role, she is responsible for formulating the company's strategy and leading the execution of critical strategic initiatives, including the development of the Hub Strategy in 2015 and overseeing the migration process following the Elavon acquisition in 2016. Before joining StoneCo, she served as a Family Office Director at Varbra from 2012 to 2016. Her career also includes several positions at McKinsey & Company in Brazil from 2006 to 2012, where she was an Associate Principal (Associate Partner) and Engagement Manager, focusing on strategy, M&A, and organizational projects for various Brazilian and global companies. She holds a PhD in Physics from the Massachusetts Institute of Technology (2005) and a Bachelor's degree in Physics from Universidade Federal do Rio de Janeiro (1998).

Mauricio Luis Luchetti, Chairman Executive Board

Mauricio Luis Luchetti has served as the Chairman of the Executive Board of StoneCo since 2022.

Augusto Barbosa Estellita Lins, Senior Advisor

Augusto Barbosa Estellita Lins transitioned from his role as President to a part-time Senior Advisor for StoneCo on July 1, 2023. He was a key figure in developing the company's initial sales and operations strategies and fostering its client-centric culture.

Key Risks to StoneCo (STNE)

1. Macroeconomic and Political Uncertainty in Brazil: StoneCo is heavily exposed to Brazil's macroeconomic and political environment, which is characterized by high inflation, elevated interest rates, and political instability. These factors can erode consumer purchasing power, increase operating costs, and negatively impact the company's growth rate and stock price. Fluctuations in interest rates, specifically, directly affect StoneCo's financial expenses and the profitability of its credit offerings. Additionally, potential changes in tax regulations in Brazil present a looming external risk that could impact the company's financial performance.
2. Intense Competition: StoneCo operates in a highly competitive fintech landscape in Brazil, facing significant rivals such as MercadoLibre (Mercado Pago), PagSeguro, Cielo, and Nubank. This intense competition exerts pressure on pricing, potentially leading to slower growth in Total Payment Volume (TPV) and impacting the company's market share. Larger competitors could also leverage their scale to aggressively expand into StoneCo's core small and medium-sized enterprise (SME) segment, challenging its market position and credit-focused strategies.
3. Credit Business Risks: The expansion of StoneCo's credit portfolio introduces inherent risks related to credit quality and potential loan losses. The company previously experienced substantial losses in its loan portfolio in 2021 due to issues with the accuracy of Brazil's national registry data used for assessing borrower creditworthiness. While StoneCo has since implemented improvements in risk monitoring and underwriting, investors are advised to closely monitor its credit portfolio, especially given a recent slight uptick in non-performing loans.

The most prominent clear emerging threat for StoneCo (STNE) is the widespread and rapid adoption of Pix, Brazil's instant payment system launched by the Central Bank.

Pix enables direct, real-time bank-to-bank transfers and payments, bypassing traditional card networks and acquirers like StoneCo. This directly threatens StoneCo's primary revenue stream derived from transaction fees (MDR) on credit and debit card payments. Pix transactions generally have significantly lower costs for merchants compared to card transactions, making it an attractive alternative and potentially pressuring StoneCo's profitability as transaction volumes shift away from higher-margin card transactions.

StoneCo (STNE) operates primarily in Brazil, offering a comprehensive suite of financial technology solutions that include payments, digital banking, credit, and software solutions for micro, small, and medium-sized businesses (MSMBs).

The total addressable market (TAM) for StoneCo's offerings across payments, banking, credit, and software in Brazil was estimated at roughly BRL 100 billion in revenue opportunity during its 2023 Investor Day, with a target to reach this by 2027. StoneCo aims to target over 90% of this substantial TAM.

Addressable Market Sizes by Product/Service in Brazil:

• Payments:
  • The Brazil real-time payments market reached 5.2 billion payments in 2024 and is projected to grow to 18.5 billion payments by 2033, demonstrating a Compound Annual Growth Rate (CAGR) of 13.44% from 2025 to 2033.
  • In terms of value, the Brazil real-time payments market is valued at USD 2.67 billion in 2025 and is forecast to reach USD 4.97 billion by 2030, with a 12.51% CAGR.
  • The Brazil digital payment market was valued at USD 9,946.40 billion in 2024 and is expected to grow to USD 35,684.93 billion by 2032, at a CAGR of 33.64% from 2025 to 2032.
  • The Brazil cards and payments market size is estimated to grow at a CAGR of 14% from 2024 to 2030.
  • Brazil's digital commerce market recorded a transactional volume of USD 276.9 billion in 2023 and is expected to increase by 51% to reach USD 500 billion in 2026.
• Credit Solutions:
  • StoneCo currently holds a market share as low as <1% in the credit segment, highlighting significant expansion potential in the Brazilian market.
  • Brazil's credit card market's financing volume reached R$552.8 billion by mid-2024, marking a 10% increase over the same period in 2023.
  • The Brazil digital lending platform market generated revenue of USD 263.2 million in 2024 and is anticipated to reach USD 1,194.5 million by 2030, with a CAGR of 29.2% from 2025 to 2030.
  • Brazil's structured credit market saw private credit funds capture R$323.1 billion in net inflows during 2024.
• Software Solutions (including POS, ERP, CRM, E-commerce, OMS):
  • The Brazil software market generated USD 12,312.0 million in revenue in 2024 and is projected to reach USD 22,699.3 million by 2030, growing at a CAGR of 10.6% from 2025 to 2030.
  • The Brazilian software market recorded revenues of $22.7 billion in 2023.
  • The Brazil SaaS market size reached USD 6.91 billion in 2024 and is expected to grow to USD 23.54 billion by 2033, exhibiting a CAGR of 14.60% during 2025-2033.
  • The enterprise software market in Brazil is expected to reach a projected revenue of US$11,470.0 million by 2030, with a CAGR of 12.3% from 2025 to 2030.
• Digital Banking/Financial Services:
  • The Brazil Retail Banking Market was valued at USD 141.72 million in 2023 and is projected to reach USD 288.71 million by 2032, with an expected CAGR of 10.70%.

StoneCo (STNE) is expected to drive future revenue growth over the next 2-3 years through several key strategic initiatives and ongoing business momentum:

1. Growth in Micro, Small, and Medium-sized Businesses (MSMB) Payments and Client Base: StoneCo continues to focus on expanding its active client base and Total Payment Volume (TPV) within the MSMB segment. This core segment has consistently shown growth, with the payments client base increasing significantly year-over-year.
2. Expansion of Financial Services, particularly Banking and Credit Solutions: The company is strategically diversifying its offerings by expanding its banking solutions, evidenced by substantial increases in total retail deposits. Furthermore, StoneCo is growing its credit portfolio and offering solutions like working capital loans and short-term overdrafts, which are expected to contribute more to profitability as they mature.
3. Cross-selling Financial Services to Software Clients: StoneCo aims to leverage its existing software client base by cross-selling its financial services. This strategy focuses on integrating financial solutions, such as payments and credit, with its software offerings in key verticals like retail and gas stations, thereby enhancing client engagement and revenue per client.
4. Technological Investment and Delivery of Bundled Solutions: Continuous investment in technology infrastructure and development is central to enhancing StoneCo's platform and services. The company's focus on delivering comprehensive, bundled solutions aims to address diverse client needs, improve client engagement, and strengthen its market position.
5. Strategic Pricing and Enhanced Monetization (Take Rates): StoneCo has demonstrated an ability to increase its revenue through strategic pricing adjustments and higher take rates across its financial services. Optimizing the monetization of its services, particularly within the MSMB segment, is a continuous driver for revenue growth.

Share Repurchases

• StoneCo authorized a new share repurchase program of up to R$2 billion on November 21, 2024, replacing a previous R$1 billion program.
• Under the former R$1 billion program, StoneCo repurchased 13,202,939 shares for a total of US$178.3 million, at an average price of US$13.52 per share.
• In the first quarter of 2025, StoneCo executed R$843 million in share buybacks, contributing to a total of R$2.4 billion in repurchases over the preceding 12 months.

Share Issuance

• In 2020, StoneCo issued US$1 billion in new shares to help finance the acquisition of Linx.

Outbound Investments

• In 2020, StoneCo acquired Linx, a leading retail management software provider in Brazil, for BRL6.7 billion (US$1.2 billion). The transaction was completed on July 1, 2021.
• In 2021, the company acquired a 4.99% stake in the online bank Banco Inter for BRL2.5 billion (US$460 million).
• StoneCo sold its stake in Banco Inter in 2022 and is reportedly considering selling Linx, with a recent announcement of divesting software assets in July 2025.

Capital Expenditures

• StoneCo's capital expenditures coverage for fiscal years ending December 2020 to 2024 averaged 0.8x.
• Reported annual capital expenditures were approximately BRL208 million in 2020, BRL247 million in 2021, BRL138 million in 2022, and BRL230 million in 2023.
• In the first quarter of 2025, software capital expenditures as a percentage of EBITDA improved to 51%, indicating efficiency gains.