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DLocal Limited (NASDAQ: DLO) reported second quarter results showing record transaction volumes and raised its full-year 2025 guidance for Total Payment Volume (TPV), revenue, gross profit and adjusted EBITDA.
By geography, Brazil and Mexico delivered strong results, with the fastest growth recorded in other regions, leading to further diversification. In Brazil, higher use of instalment payments and recovery of one-off processing costs supported performance. Argentina also contributed positively, offsetting lower foreign exchange spreads, while South Africa and other markets in Africa and Asia benefited from volume growth and reduced processing costs.
“We are pleased to report another quarter of solid growth and disciplined execution, with significant acceleration across our key financial metrics. These results are a testament to our high-growth, expanding margin, and healthy free cash flow business model, and they demonstrate the substantial value we provide to our merchants,” said Pedro Arnt, DLocal Chief Executive Officer.
TPV reached USD 9.2 billion in the three months to 30 June 2025, up 53% year-on-year and 14% higher than the first quarter. In constant currency terms, growth would have been 65%. Revenues rose 50% to USD 256.5 million compared with USD 171.3 million a year earlier.
Gross profit was USD 98.9 million, up 42% from the second quarter of 2024. Operating profit increased 85% to USD 55.8 million, while adjusted EBITDA rose 64% to USD 70.1 million, representing a margin of 27%. Adjusted EBITDA over gross profit increased for the fifth consecutive quarter, reaching 71%.
The company reported free cash flow of USD 48.4 million, more than doubling the USD 19 million recorded a year earlier. As at 30 June 2025, cash and cash equivalents stood at USD 476.9 million, including USD 253.8 million of corporate cash.
Revenue growth outpaced TPV growth in the quarter due to a greater share of pay-ins. The company noted a partial volume loss in Egypt after a large merchant implemented redundancies, combined with lower foreign exchange spreads following the local currency devaluation. In Latin America, retry costs in Chile and Colombia weighed on gross profit despite broader volume growth.
Net income for the quarter was USD 42.8 million, or USD 0.14 per diluted share, down 7% from USD 46.2 million a year earlier. DLocal said earnings were negatively affected by the devaluation of the Argentine peso on its bond portfolio. The company reduced its Argentine exposure by more than 80% and reallocated funds to U.S. Treasuries.
Guidance for the full year 2025 has been revised upwards, with TPV expected to grow 40% to 50%, revenue by 30% to 40%, gross profit by 27.5% to 37.5%, and adjusted EBITDA by 40% to 50% compared with 2024. The company highlighted risks including global macroeconomic conditions, changes in trade policy, fiscal shifts in Brazil, and potential currency devaluations in Argentina and Egypt.
