Author | Alex Immerman & Santiago Rodriguez
Compile | Deep Tide TechFlow
Original link:
https://www.techflowpost.com/en/article/30831
Overview: a16z dissects Revolut's 2025 annual report, revealing how a company achieved a 76% CAGR in mature financial markets. The numbers are astonishing, but what's even more intriguing is the growth logic behind it: not relying on interest margins for profit, ROE is 3-4 times that of traditional banks, and user NPS is more than double the industry average. When you put all this together, it’s no longer just a challenger bank story.
Full text as follows:
As a growth-stage investor, we often say that outstanding companies let their numbers do the talking. Revolut, as a UK company, is required to disclose annual financial data, and its numbers are outliers — to put it conservatively:
Revenue grew by 46%, reaching £4.5 billion;
Pre-tax profit grew by 57%, reaching £1.7 billion, with a profit margin of 38%;
Retail customer growth of 30%, adding 16 million by 2025;
Revolut has penetrated across Europe, with no single country contributing more than 25% of fee income;
Revenue is distributed across six business segments, with no single category exceeding 22%;
11 product lines each generated over £100 million in revenue.
Return on equity (ROE) reached 35%, a record level among peers (despite capital surplus).
Revolut continues to maintain rapid and efficient growth — its 'Rule of 75%' (revenue growth rate + net profit margin) ranks at the top tier among modern and mature financial institutions.
More importantly, we believe Revolut still has ample growth space in existing markets, both in terms of customer growth and monetization. Not to mention the new markets that may yet be tapped — Revolut has just applied for a U.S. banking license, demonstrating real global ambitions.
This is not your grandma's new bank. Revolut has the potential to become one of the largest banks in the world. There’s still a long way to go to get there, but we believe the foundation is already laid.
Enough chit-chat, let’s get to the point.
1. One of the fastest-growing financial institutions globally
Let's start with revenue. Revolut's revenue growth is staggering.
Alongside NU (Nubank), they stand in a league of their own compared to other players in the consumer fintech industry (see the chart below). Since breaking the $1 billion revenue mark in 2022, Revolut has achieved a staggering compound annual growth rate of 76% (70% when measured in GBP) over the next four years, making it one of the fastest-growing companies post the billion-dollar revenue threshold. This growth rate is particularly noteworthy given the maturity of the European consumer banking sector, unlike the developing markets where NU operates.
Chart: Revenue converted to USD at year-end exchange rates, NU revenue is net after deducting interest and expected credit losses (ECL), source: Revolut 2025 Annual Report
For a different reference: in 2022, Revolut's revenue compared to any of Robinhood, Affirm, Sofi, Adyen, Wise, or Chime was either less or about the same. Now, its revenue exceeds any of those well-known consumer fintech companies by 33% to nearly 3 times.
2. Breaking down Revolut's growth algorithm: Six horsepower running simultaneously
One key differentiator for Revolut is that it’s not just a one-trick pony anymore. It has multiple income drivers firing on all cylinders.
Revolut initially tackled a real pain point for Europeans: foreign exchange fees. With Revolut, Europeans traveling inside and outside the Eurozone no longer face payment delays or the 5% fees charged by banks when sending money abroad.
From once being a single product, regionally concentrated pain-point solution, Revolut has grown into a fully functional personal and business bank, now in Europe (Revolut's primary operation area) for every three new accounts opened, about one chooses Revolut:
Chart: The survey was conducted in key markets, using a sample of ordinary adults, who indicated where they opened accounts and the opening time for each account, source: a16z European Banking Survey, July 2025 (N = 3500)
One in five working-age people in Europe uses Revolut. The appeal of Revolut across the Eurozone reflects the speed of the company's product iterations and execution power, which is second to none.
Revolut has launched a complete suite of personal and business banking functions, driving growth across diverse European markets. Importantly, Revolut's product suite is increasingly attracting users in the Eurozone who weren’t initially concerned about the foreign exchange value proposition. We could say Revolut's platform is 'feature-complete' — but it keeps rolling out new features, which may actually understate it.
It's not just about the number of features and products, but also the quality of execution. Users love it. The company reported in 2024 that 65% of new users came through organic acquisition or referrals from existing users. Our research also shows that Revolut's user NPS is more than double the industry average.
Overall, the number of users is growing at a compound rate of 30%, reaching 68 million by the end of 2025.
Source: Revolut Annual Report
For a different frame of reference regarding 68 million users: JPMorgan — the largest bank globally outside of China — has about 85 million consumer clients (with over 70 million considered 'digitally active' users).
Admittedly, JPMorgan's total AUM puts it far above Revolut, but from a pure user coverage perspective, Revolut is no longer just a 'challenger'; it’s a real competitor. Revolut's user base exceeds the total of Sofi, Robinhood, Dave, and Chime combined.
A complete product suite not only continues to attract more customers but also creates an increasingly diversified revenue structure:
Source: Revolut Annual Report
The company publicly disclosed six main sources of revenue: interest income, card payments, subscriptions, and other income.
All six segments have seen year-on-year growth, with no single segment exceeding 22%.
The degree of business diversification even exceeds what this disclosure reflects, as there could be multiple sub-products under each revenue stream (for example, the wealth segment simultaneously includes public stocks and crypto assets). By 2025, 11 product lines will each generate over £100 million in revenue.
Importantly, 76% of revenue comes from fees, which has increased by over 4 percentage points compared to 2024, while interest income accounts for just under 22%. This is in stark contrast to mature banks that derive over 70% of their income from interest, and it's one of the reasons Revolut can achieve high ROE (return on equity, detailed later).
Not surprisingly, the diversified revenue structure has also brought about diversified ARPU growth.
Chart: ARPU is defined as product line revenue/average number of customers during the period, source: Revolut Annual Report
Since 2022, every disclosed revenue stream has shown growth, with overall ARPU increasing by about 65%, equating to an 18% annualized compound growth rate.
The importance of diversification lies in its support for sustained compounding and building resilience against risks. Any given year may see some product lines explode while others face headwinds (like last year's interest rate drops). However, overall, by continuously adding new products and core business to capture wallet share, strong ARPU growth remains attainable.
3. Top-notch efficiency
Revolut has demonstrated rapid user growth, strong product iteration speed, and diversified revenue; the efficiency we promised has also been delivered.
By 2025, Revolut aims for a revenue increase of 46% with a net profit margin of 29%, achieving a 'Rule of X' (growth rate + profit margin) of 75%. The 'Rule of 40' just won't cut it anymore!
Chart: 2025A data or current analyst forecast data for companies that have not yet published financial reports, bubble size represents total revenue for 2025, NU revenue is net after deducting interest and expected credit losses (ECL), source: public financial data obtained through CapIQ, a16z analysis
This combination of growth and efficiency places Revolut in a very rare position — achieving a Rule of 75% under a revenue scale exceeding $1 billion is historically quite rare.
In fact, considering that both Robinhood and Dave are expected to have growth rates below 30% next year, Revolut could soon find itself standing alone at the top of the podium.
Efficiency has become ingrained in Revolut's DNA. Self-developed banking infrastructure, highly organic growth, and strict cost control have combined to achieve a 29% net profit margin. Coupled with very few physical locations, Revolut now has a meaningful cost advantage over traditional banks, and this advantage will compound as scale continues to expand.
AI is further enhancing operational leverage. Take customer service, for example:
In 2024, Revolut's smart assistant chatbot reduced issue resolution time by 80%. In 2025, this improvement continues — retail resolution time drops by over 40%, and business resolution time drops by another 50%, while user NPS improves by nearly 12 percentage points year-on-year. Revolut's smart assistant can now resolve over 75% of customer inquiries.
This efficiency has allowed Revolut to achieve the highest ROE we've seen among fintech scale companies (and it continues to improve). We've previously discussed the importance of ROE in bank valuations, and Revolut is a prime example of scale efficiency.
Chart: ROE is defined as 2025 net income/average equity during the period, source: public financial data obtained through CapIQ
Revolut’s 35% ROE far exceeds that of other leading consumer fintech companies, being approximately 3-4 times that of mature banks. It’s worth noting that Revolut is in a 'capital surplus' state (i.e., reported equity exceeds the capital requirements set by banks), meaning its 'real' ROE could be even higher.
Very few can achieve such capital-efficient growth.
4. Ample growth space: ARPU × Number of users
Despite Revolut's impressive performance in 2025, we believe there is still a huge runway ahead. Returning to the company's core revenue growth algorithm (number of users × ARPU), both variables have significant room for growth.
There are still more users to acquire.
The company reported a user base of 68 million by the end of 2025. As mentioned, this is a significant number, but it’s still only about 15% of Europe's (excluding Russia) approximately 450 to 500 million adult population. This doesn't even consider Australia and Singapore (existing markets), Mexico and Brazil (new markets), the U.S. (just applied for a banking license), and many more areas waiting to be explored.
Revolut still has many potential users to acquire.
Moreover, the current user composition already indicates that the future won't be the same as the present. Unless something changes, Revolut's users tend to be younger and more digitally savvy — we believe this demographic represents the ultimate aspirations of the majority.
Chart: Surveyed markets include the UK, Ireland, France, Spain, Italy, Germany, and Poland, source: a16z European Banking Survey, February 2026 (N = 4200)
As Revolut continues to acquire a large proportion of first-time account holders (and persuades the older demographic that banking experiences can be pleasant), market share should continue to grow.
Importantly, our research shows that about 25% of Revolut users under 35 view Revolut as their main account. Just this alone, as this group ages, will have a profound impact on the future market share of banking in Europe.
ARPU has even more expansion potential
Another growth dimension, ARPU, has even more room to expand.
The wallet share transfer in financial services typically spans decades rather than years. Revolut continues to win user trust: main account users (by company standards) grew by 45%, exceeding an overall user growth of 30%.
The rapid growth of main account users is crucial, as in terms of ARPU, main account users are the jackpot: our research shows that traditional banking institutions can push their 'main account' share above 60% with mature customer relationships.
Revolut main account users self-report spending and saving on their main accounts to be about twice that of any other active accounts — and spending amounts increase with age.
In short, more (and increasingly mature) main account users can translate into higher ARPU, and if traditional banking experiences can serve as a reference, the ceiling for Revolut's continuously improving 'main account share' is quite high.
Another aspect of the growth in main account relationships is the untapped loan income opportunity Revolut has: as mentioned, currently, 76% of Revolut's revenue comes from fees, while a typical mature bank's proportion is around 30%; by the end of 2025, Revolut's loan-to-deposit ratio (LDR) is only about 6%, in contrast to mature banks typically being 70-90% or more (around 4% when calculated against total client balances). Loan balances are expected to grow about 2x by 2025 and can continue to compound for many years.
Of course, robust loan growth takes time. But if the ceiling set by traditional banks can serve as a reference, Revolut has ample opportunity to significantly expand ARPU by leveraging its balance sheet and providing better loan products to customers. For comparison, a rough estimate puts Barclays' UK consumer and business banking line's ARPU at around £435, roughly 6 times what Revolut's is today.
Here’s where Revolut currently stands in terms of coverage breadth (penetration) and depth (main account share):
Source: a16z European Banking Survey, February 2026 (N = 4200)
Revolut has ample runway to continue moving up and to the right (with Ireland's situation primarily upward), both by expanding its user base and by deepening more relationships into 'main accounts.' The latter should happen organically as the younger user base matures.
5. Conclusion: No longer just a challenger
The importance of Revolut's 2025 figures lies not just in their impressiveness, but because they paint a complete picture of a financial institution, not just a 'challenger' bank.
User growth remains exceptional, monetization capabilities continue to widen, main account adoption is on the rise, and even as the company continues to invest heavily and expand rapidly, profitability is improving. This combination is extremely rare in financial services (and indeed any industry).
There are still execution challenges ahead — especially in areas like lending, regulation, and entering new markets — but after reading this annual report, we feel the focus has shifted from 'Can Revolut become a scaled banking platform?' to 'How big can this platform get?'
The company's long-term goal is to 'have 100 million active users across 100 countries.' This journey is already underway.