StoneCo: 3 Key Takeaways for Long-Term Investors

On its third quarter of 2026 earnings call, held on Nov. 12, 2026, StoneCo (NASDAQ:STNE) reduced its 2026 profitability guidance as persistent high interest rates squeezed small merchants across Brazil. Macroeconomic friction forces the payments processor to pivot toward guaranteed credit lines and tighter expense control to protect long-term returns. Three things management said stand out.

1. Management Suspended 2027 Outlook Amid High Interest Rates

Persistent inflation and elevated borrowing costs continue to strain small businesses, making future financial modeling unpredictable. Withdrawing medium-term targets allows the company to adapt to volatile macroeconomic shifts without anchoring to outdated projections.

On 2027, we are withdrawing the targets we communicated earlier this year. Interest rates remain a headwind, and the economic uncertainty we see today makes the macro outlook for next year volatile.
-- Mateus Scherer, Chief Executive Officer

2. Credit Strategy Shifts Toward Government-Secured Programs

Expanding credit to small merchants during an economic slowdown increases delinquency risks. Directing loan volume into government-guaranteed lines protects the balance sheet while preserving steady interest income.

We tightened our stance on the dedicated desk, where larger tickets call for more caution, and we directed more of our growth to government-backed programs. These lines carry a guarantee, and that lets us keep serving our clients in a tougher environment at healthy risk-adjusted returns.
-- Mateus Scherer, Chief Executive Officer

3. Simpler Product Structures Target Merchant Churn

Rapid product expansion created operational friction that to higher merchant churn. Streamlining pricing tiers and restructuring sales incentives prioritize long-term customer retention over short-term transaction fees.

As we expanded our range of products and services, our offers and our operation became harder for clients to navigate. Since then, we have been working to remove the complexity. We are making our offer simpler and our pricing more transparent.
-- Mateus Scherer, Chief Executive Officer

Looking Ahead

High borrowing costs and softening merchant sales continue to exert pressure on profitability, prompting leadership to tighten credit underwriting and focus on strict expense discipline. StoneCo relies on a growing deposit base and deep distribution networks to protect its market position during the economic slowdown. Executive leadership is closely monitoring credit model performance, merchant transaction growth, and operational efficiency across all business lines.

We are currently reviewing our credit models for a tougher macro backdrop, and that may weigh on the cost of risk for longer than we initially expected.
-- Diego Salgado, Chief Financial Officer and IRO

Long-term expansion hinges on transitioning simple payment-processing merchants into fully integrated banking clients. Management expects that deepening these layers of relationships will build a durable competitive moat across Brazil.

Our goal is to be the bank that entrepreneurs rely on to run and grow their businesses, and deepening our banking and credit relationships is how we get there.
-- Diego Salgado, Chief Financial Officer and IRO

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