Stone / StoneCo Profile: Pandemic Layoffs, Business Model, and Current Status

Category: merchant fintech
Pandemic-layoff role: Additional sourced company
Last updated: 2026-09-26

Founders, executives and investors

StoneCo's annual report names André Street and Eduardo Pontes as its two co-founders. Until 2022 they controlled the company through super-voting Class B shares held by HR Holdings; in November 2022 Brazil's Central Bank approved a restructuring in which Pontes converted his shares, leaving no shareholder with more than 50 percent of the votes. Street left the board in April 2024 and remained a reference shareholder. Thiago dos Santos Piau was chief executive in May 2020.

StoneCo's shares have traded on the Nasdaq Global Select Market since October 25, 2018. The holding company is registered in the Cayman Islands.

Business before the pandemic

Stone started by selling a simple card-payments service to small and medium businesses that, in its words, "were often ignored or underserved by the industry at the time." In 2017 it became the first non-bank company authorized by Brazil's Central Bank to operate as a card acquirer. It later launched a cheaper, digital-first brand, Ton, for micro-merchants. Total payment volume grew from R$83.4 billion in 2018 to R$209.9 billion in 2020.

What the pandemic changed

StoneCo's May 12, 2020 filing set out its response. About 90 percent of staff, including most salespeople, were working from home and signing up clients by phone and chat. Besides the relief and microloans, the company put R$5 million toward a temporary hospital in Rio de Janeiro and R$500,000 toward COVID-19 tests, and ran a public campaign asking Brazilians to buy from small local businesses. It reported "partial volume recovery in April and early May." The filing said the R$500,000 paid for 10,000 tests; the company's May 26 earnings release said 8,000. The filing attached a letter from Piau to Stone's staff.

The letter announced that 1,300 people, 20 percent of the staff, were leaving the company that day. By the end of March, Stone's May 26 release said, it had increased its headcount by "over 530 people." Piau wrote that the company had to resize a high-growth model in which "we have always hired more people than needed for the Company to operate in the immediate present." The letter said those leaving would keep their health plans for four more months, and severance cost R$15.2 million. Stone began hiring again in July. Its annual report counted 7,239 full-time employees at the end of 2020, against 5,938 a year earlier. Employee-benefits expense for 2020 was R$833.3 million, against R$576.4 million in 2019; profit sharing and annual bonuses came to R$90.0 million, against R$45.6 million.

The relief went through two of Stone's fees. Merchants pay Stone fixed monthly subscription fees, and they can take early payment on their card receivables, "less a prepayment fee." The May 26 release said Stone had "provided R$30 million in relief to our clients, including subscription exemptions and lower prepayment rates for the hardest-hit retailers." For a limited time, those merchants paid no subscription and less to get their card money early. Stone put those incentives at R$4.1 million in March and R$13.3 million in the second quarter. Its fourth-quarter release put 2020 fee exemptions at R$26 million. On the year-end call management said that, had it adjusted out the exemptions and R$15 million of donations, "which we didn’t, our adjusted net income would be close to R$1bn." On the first-quarter 2021 call it said higher credit provisions and "financial incentives to clients due to commerce restrictions imposed by Covid’s second wave" had cut results by R$116 million.

Brazil's emergency payments, which StoneCo's filings call "Coronavoucher," targeted "autonomous and informal workers and people without income." Stone took part in those transactions mainly through its integrated partners, and called them "debit-like" with lower take rates. Volume was R$2.0 billion in the second quarter of 2020, R$21.6 billion in the third and R$7.1 billion in the fourth. For the year it came to R$30.7 billion, 14.6 percent of R$209.9 billion in total payment volume. In 2021 it fell to R$3.4 billion, and the annual report put 2021 volume growth at 31.2 percent, or 51.8 percent without Coronavoucher.

By the end of 2020 Stone's credit portfolio had reached R$1.5 billion across nearly 90,000 clients, management said. The loans were backed by a "lock" on merchants' card receivables. In its second-quarter 2021 release Stone said malfunctioning receivables-registry providers had let merchants, "especially those more affected by lockdowns," shift transactions to other acquirers that "by-passed the collateral guarantees they had given to us." It also said its "underwriting capabilities and collection process still have to evolve." Stone temporarily stopped lending: it disbursed R$752.7 million in the first quarter of 2021, R$376.2 million in the second and R$0.8 million in July. On the August 30, 2021 call management said a fair-value markdown had cut that quarter's revenue by R$397 million, and that Stone had received "over 100%" of what it disbursed to its fourth-quarter 2019 and first-half 2020 cohorts. The annual report put 2021 credit revenue R$767.4 million lower on negative fair-value adjustments.

A putative securities class action was filed against StoneCo on November 19, 2021; the amended complaint, filed on August 7, 2022, alleges that StoneCo misrepresented "the risks and profitability of its credit product." On September 25, 2024 the court dismissed several categories of alleged misstatements. It let allegations about statements on "the selectivity of the credit scoring process over time and the effects of COVID-19 and Brazil’s new registry laws on delinquency rates" go forward and, in StoneCo's account, made "no determination as to the factual accuracy of the allegations." In its 2024 annual report StoneCo said the suit lacked merit. The lead plaintiff agreed to a settlement of R$145.3 million, R$96.6 million of it covered by insurers, and the court approved it on February 27, 2026. Some investors opted out and filed their own action in the Southern District of New York; StoneCo said in April 2026 that it had moved to dismiss it.

After the first shock

Stone moved to buy Linx, a Brazilian retail-software company, in 2020; the combination closed on July 1, 2021. It built a banking business at the end of 2020 and the start of 2021, and rebuilt its credit product "with a new team, new technology and new governance." Net results moved widely: a R$526.4 million net loss in 2022, including an R$853.1 million mark-to-market loss on its stake in Banco Inter; R$1.6 billion of net income in 2023; and a R$1.5 billion net loss in 2024, after a R$3.56 billion goodwill impairment on the software business.

Since 2025

StoneCo's annual report for 2024, filed on April 24, 2025, put its client base at 4.2 million. It had looked for a partner to run the software business, and by March 2025 had received several proposals, but "none of them met the intrinsic value of the asset." In the second quarter of 2025 it agreed to sell Linx Sistemas e Consultoria and some other software assets. The sale closed on February 27, 2026, and StoneCo's annual report for 2025 put the total received at R$3,272.2 million.

Founders, executives and investors

Business before the pandemic

What the pandemic changed

After the first shock

Since 2025

Sources