SAO PAULO (Reuters) -Nu Holdings ( NU ), which runs Brazilian digital lender Nubank, posted on Thursday a 42% increase in its net profit from a year earlier on a foreign exchange-neutral basis, causing its shares to jump more than 8% in after-hours trading.

The firm, which has nearly 123 million clients across Brazil - its main market - Colombia and Mexico, posted a $637 million second-quarter net profit for the April to June period. Revenue stood at $3.7 billion, up 40% year-on-year.

Chief Financial Officer Guilherme Lago told Reuters the profit increase was driven by operational leverage and revenue growth, but said the factors behind that growth are starting to change.

"If in the last three to five years a major part of our growth came from adding new customers, in the next three to five years a major part of our revenue growth in Brazil will come from deepening the relationship with these customers," Lago said.

Nubank's annualized return on equity, a gauge of profitability, came in at 28%, in line with the reported year-ago figure.

Nubank posted a "strong quarter," Citi analysts wrote, noting that net profit came in above expectations while net interest margin showed a recovery.

Shares in Nubank were up 8.3% in extended trade in New York.

The lender's total loan book grew 8% from the first quarter to $27.3 billion, as personal loans expanded within Nubank's overall portfolio, which is largely made up of outstanding credit card debt.

Meanwhile, the early default ratio stood at 4.4%, falling 0.3 percentage points from the first quarter. The over-90 day ratio reached 6.6%, up 0.1 percentage point in the same period, with Nubank saying it reflected both a rise in short-term delinquencies in the first quarter and a seasonal pattern.

"We will continue to grow unsecured lending originations fairly strongly throughout the remainder of 2025 and 2026 as long as it continues to see the asset quality numbers that we are seeing in our book," Lago said in a call with analysts.

"Until today... everything seems to be super on track," he added.