Key Factors
- Capital One agreed to purchase Brex for $5.15 billion, about 50% money and 50% inventory, to develop its business-card platform.
- Shares fell about 6% after a This fall earnings miss and renewed give attention to credit score prices and expense progress.
- The deal displays fintech’s reset: strategic patrons, deposits that matter, and exit costs beneath the height.
Capital One is shopping for Brex, the corporate-card and spend-management firm based in 2017 by Brazilians Pedro Franceschi and Henrique Dubugras, in a deal valued at $5.15 billion.
The businesses count on to shut round mid-2026, topic to customary circumstances. Brex will function inside Capital One, with Franceschi set to stay CEO.
Capital One’s case is to lean much less on shopper cycles and extra on enterprise prospects. Brex brings software program that automates card controls, expense approvals, and funds.
Brex says greater than 25,000 corporations use its platform in 50-plus nations. Studies across the announcement put Brex-related deposits at roughly $13 billion.
Capital One earnings overshadow Brex deal
The market’s first response, nonetheless, centered on Capital One’s outcomes. On January 23, shares slid roughly 6% as buyers weighed the earnings launch.
For This fall 2025, Capital One reported adjusted earnings per share of $3.86, beneath the consensus estimate of $4.17, whereas income was $15.6 billion, barely above expectations.
Credit score and balance-sheet traces saved consideration on danger. The supply for credit score losses rose $1.4 billion to $4.1 billion, together with internet charge-offs of $3.8 billion and a $302 million enhance in loan-loss reserves.
Loans held for funding ended the interval at $453.6 billion, with credit-card loans at $279.6 billion. Deposits totaled $475.8 billion. Internet curiosity margin was 8.26%, down 10 foundation factors from the prior quarter.
Capital ended 2025 with a Basel III standardized CET1 ratio of 14.3%. Brex’s valuation provides one other layer. Its private-market peak was broadly cited close to $12.3 billion, making the $5.15 billion worth a pointy markdown.
Even so, deal protection framed the acquisition at about 3.5% of Capital One’s market worth. For Brazil’s tech story, the message is sober: world scale nonetheless wins, however markets now reward self-discipline over hype.
