N26 reached
its first full year of net profitability in 2025, with revenue climbing past
€500 million as the German digital bank leaned on higher deposit income and a
larger base of paying customers.
The lender
posted group net income of €1.6 million for the year, a swing from a €42
million loss in 2024, according to figures the company released today (Thursday).
Revenue
rose 13% to €501.6 million, while gross profit grew 33% to €350.5 million. N26
attributed the wider gap between the two to lower direct costs and what it
called the operating leverage built into its platform, meaning revenue is
growing faster than the cost of serving each customer.
The result
lands during a period of upheaval at the top of the company. Mike Dargan, a
former UBS executive, took over as chief executive in
April, inheriting a
bank that had spent much of the prior year cycling through leadership changes
and regulatory friction.
Profit Milestone Rests on
a Thin Margin
The
headline profit is small set against the size of the business. Net income of
€1.6 million on €501.6 million in revenue works out to a margin of roughly
0.3%, leaving little cushion.
Most of the
improvement came from shrinking losses rather than a jump in earnings, with the
€43.6 million year-on-year swing driven by cost discipline and rising interest
income.
The
turnaround follows a rough stretch for the company’s valuation, which fell sharply from its 2021 peak as fintech funding cooled and
regulatory problems mounted.
Net
interest income, which covers treasury and lending activity, rose 49% to €166.3
million and supplied 47% of gross profit. Much of that rests on deposits, and
N26 has been courting balances with instant savings accounts paying up
to 4% across
European markets.
Net fee and
commission income increased 21% to €184.2 million, the remaining 53% of gross
profit, helped by subscription growth and card spending.
Revenue-relevant
customers, the subset N26 counts as generating income, grew 16% to 5.6 million.
Annual transaction volume rose 14% to €170.7 billion, and customer deposits
topped €10.5 billion.
|
Metric |
2024 |
2025 |
Change |
|
Revenue (€m) |
445.4 |
501.6 |
+13% |
|
Gross profit (€m) |
264.0 |
350.5 |
+33% |
|
Net fee |
152.5 |
184.2 |
+21% |
|
Net interest income (€m) |
111.6 |
166.3 |
+49% |
|
Net income/loss (€m) |
-42.0 |
1.6 |
n.m. |
|
Revenue-relevant customers (m) |
4.8 |
5.6 |
+16% |
Source: N26 management reporting framework
Two Accounting Frameworks,
Two Sets of Numbers
Thursday’s
figures come from a press release, not a full audited report, which N26 has yet
to publish. The numbers the company put front and center follow its own
management reporting framework, which it says aligns with IFRS principles.
Its audited
statutory accounts, prepared under German banking rules known as RechKredV,
tell a different story on the components. On that basis, N26 reported €191.3
million in net interest income and €176.9 million in net fee and commission
income, both diverging from the management figures.
Gross
revenue under RechKredV came to €498.1 million, just shy of the €501.6 million
the company led with.
Group net
income is identical under both frameworks, the company said.
Asked when
the complete accounts would appear, N26 told Finance Magnates it would publish
the audited statements “in line with the applicable statutory filing
deadlines” and make them available through official registers.
Revolut and Bunq Set the
Profitability Bar
N26’s
milestone arrives years after some European rivals crossed the same line, and
on a far smaller scale. Revolut, the region’s largest neobank, reported pretax profit of £1.7
billion for 2025
and net profit of £1.3 billion, its fifth straight profitable year, with a
customer base above 68 million.
The Dutch
challenger bunq has been in the black since 2023 and reached 20 million users in 2025, reporting 65% profit growth in its
most recent results. Both leaned on high interest rates to earn yield on
customer deposits, the same lever that lifted N26’s interest income.
Where N26
stands apart is its starting point. The bank spent years under a BaFin-imposed
cap that limited it to 50,000 new customers a month, a restriction tied to
anti-money-laundering failures that also drew a €9.2 million fine.
That
ceiling held back the customer growth rivals used to scale, and lifted only
shortly before fresh regulatory problems surfaced.
Regulators Still Watching
Closely
Profitability
has not closed the book on N26’s regulatory troubles. In 2025, BaFin imposed
fresh restrictions after an audit flagged weaknesses in
internal controls,
ordering the bank to hold extra capital, installing a special monitor for the
second time since 2021, and barring new mortgage lending in the Netherlands.
The
supervisory pressure came alongside a boardroom reshuffle. Co-founder Valentin
Stalf stepped down as co-chief executive in 2025 after disputes between the
founders and investors, clearing the path for Dargan’s arrival.
N26 has
been widening its product range to lift income per customer, adding stock and ETF trading and rolling out savings products
across Europe.
The company
said it plans to keep investing in banking, savings and investment offerings
while expanding its use of artificial intelligence in customer service and
internal operations.
Momentum Carries Into 2026
Early 2026
figures point to a stronger run. On a preliminary basis, N26 said it generated
net income of €9.8 million in the first quarter, on revenue of €130 million and
gross profit of €92 million, already well above the full-year 2025 profit.
Dargan said
the financial position gives the bank room “to reinvest heavily” in
new products. Chief Financial Officer Arnd Schwierholz said N26 would keep
“delivering sustainable growth while continuing to invest in products,
technology” and resilience.
N26
operates in 24 markets on a German banking license with a team of about 1,600.
Whether it can turn a slim first profit into something more durable will hinge
on keeping costs down while regulators keep watching.
N26 reached
its first full year of net profitability in 2025, with revenue climbing past
€500 million as the German digital bank leaned on higher deposit income and a
larger base of paying customers.
The lender
posted group net income of €1.6 million for the year, a swing from a €42
million loss in 2024, according to figures the company released today (Thursday).
Revenue
rose 13% to €501.6 million, while gross profit grew 33% to €350.5 million. N26
attributed the wider gap between the two to lower direct costs and what it
called the operating leverage built into its platform, meaning revenue is
growing faster than the cost of serving each customer.
The result
lands during a period of upheaval at the top of the company. Mike Dargan, a
former UBS executive, took over as chief executive in
April, inheriting a
bank that had spent much of the prior year cycling through leadership changes
and regulatory friction.
Profit Milestone Rests on
a Thin Margin
The
headline profit is small set against the size of the business. Net income of
€1.6 million on €501.6 million in revenue works out to a margin of roughly
0.3%, leaving little cushion.
Most of the
improvement came from shrinking losses rather than a jump in earnings, with the
€43.6 million year-on-year swing driven by cost discipline and rising interest
income.
The
turnaround follows a rough stretch for the company’s valuation, which fell sharply from its 2021 peak as fintech funding cooled and
regulatory problems mounted.
Net
interest income, which covers treasury and lending activity, rose 49% to €166.3
million and supplied 47% of gross profit. Much of that rests on deposits, and
N26 has been courting balances with instant savings accounts paying up
to 4% across
European markets.
Net fee and
commission income increased 21% to €184.2 million, the remaining 53% of gross
profit, helped by subscription growth and card spending.
Revenue-relevant
customers, the subset N26 counts as generating income, grew 16% to 5.6 million.
Annual transaction volume rose 14% to €170.7 billion, and customer deposits
topped €10.5 billion.
|
Metric |
2024 |
2025 |
Change |
|
Revenue (€m) |
445.4 |
501.6 |
+13% |
|
Gross profit (€m) |
264.0 |
350.5 |
+33% |
|
Net fee |
152.5 |
184.2 |
+21% |
|
Net interest income (€m) |
111.6 |
166.3 |
+49% |
|
Net income/loss (€m) |
-42.0 |
1.6 |
n.m. |
|
Revenue-relevant customers (m) |
4.8 |
5.6 |
+16% |
Source: N26 management reporting framework
Two Accounting Frameworks,
Two Sets of Numbers
Thursday’s
figures come from a press release, not a full audited report, which N26 has yet
to publish. The numbers the company put front and center follow its own
management reporting framework, which it says aligns with IFRS principles.
Its audited
statutory accounts, prepared under German banking rules known as RechKredV,
tell a different story on the components. On that basis, N26 reported €191.3
million in net interest income and €176.9 million in net fee and commission
income, both diverging from the management figures.
Gross
revenue under RechKredV came to €498.1 million, just shy of the €501.6 million
the company led with.
Group net
income is identical under both frameworks, the company said.
Asked when
the complete accounts would appear, N26 told Finance Magnates it would publish
the audited statements “in line with the applicable statutory filing
deadlines” and make them available through official registers.
Revolut and Bunq Set the
Profitability Bar
N26’s
milestone arrives years after some European rivals crossed the same line, and
on a far smaller scale. Revolut, the region’s largest neobank, reported pretax profit of £1.7
billion for 2025
and net profit of £1.3 billion, its fifth straight profitable year, with a
customer base above 68 million.
The Dutch
challenger bunq has been in the black since 2023 and reached 20 million users in 2025, reporting 65% profit growth in its
most recent results. Both leaned on high interest rates to earn yield on
customer deposits, the same lever that lifted N26’s interest income.
Where N26
stands apart is its starting point. The bank spent years under a BaFin-imposed
cap that limited it to 50,000 new customers a month, a restriction tied to
anti-money-laundering failures that also drew a €9.2 million fine.
That
ceiling held back the customer growth rivals used to scale, and lifted only
shortly before fresh regulatory problems surfaced.
Regulators Still Watching
Closely
Profitability
has not closed the book on N26’s regulatory troubles. In 2025, BaFin imposed
fresh restrictions after an audit flagged weaknesses in
internal controls,
ordering the bank to hold extra capital, installing a special monitor for the
second time since 2021, and barring new mortgage lending in the Netherlands.
The
supervisory pressure came alongside a boardroom reshuffle. Co-founder Valentin
Stalf stepped down as co-chief executive in 2025 after disputes between the
founders and investors, clearing the path for Dargan’s arrival.
N26 has
been widening its product range to lift income per customer, adding stock and ETF trading and rolling out savings products
across Europe.
The company
said it plans to keep investing in banking, savings and investment offerings
while expanding its use of artificial intelligence in customer service and
internal operations.
Momentum Carries Into 2026
Early 2026
figures point to a stronger run. On a preliminary basis, N26 said it generated
net income of €9.8 million in the first quarter, on revenue of €130 million and
gross profit of €92 million, already well above the full-year 2025 profit.
Dargan said
the financial position gives the bank room “to reinvest heavily” in
new products. Chief Financial Officer Arnd Schwierholz said N26 would keep
“delivering sustainable growth while continuing to invest in products,
technology” and resilience.
N26
operates in 24 markets on a German banking license with a team of about 1,600.
Whether it can turn a slim first profit into something more durable will hinge
on keeping costs down while regulators keep watching.