B3's New CEO Sets a Resilience-First Agenda as Recurring Revenues Prove Their Worth
B3's Q2 2026 earnings call showed a company leaning into diversification and new products even as a July technical failure, rising taxes, and an election cycle test its operational and financial mettle.
B3SA3.SA · Earnings Call · 2026-08-12
Leadership, Resilience, and the July 31 Incident
Christian Egan's first earnings call as CEO was less about a strategic overhaul and more about reaffirming a roadmap and setting a tone. His opening message was unambiguous: “My priority in the first month has been to listen.” — Christian Egan, Chief Executive Officer (CEO) · 2026-08-12 That listening tour included clients, employees, and regulators, and it underlined the idea that B3's structure is sound; execution is what matters. The real test came with the July 31 market opening failure. Egan acknowledged it directly, calling it a failure to meet the standard B3 demands of itself, and committed to a measurable improvement in operational resilience:
Operational resilience is the foundation of everything that B3 delivers and raising it in a continuous and measurable way is a priority of my tenure.
CFO Andre Milanez, fielding analyst questions, added that the mitigation steps are already underway and that this is unlikely to drive a meaningful step-up in spending—the company already invests roughly 10% of net revenues in product development and platform modernization. The keyword technical failure is not something any exchange wants on its tape, but the way this management has framed it—as a call to action rather than a one-off—signals a disciplined, prioritization-driven approach.
The Recurring Revenue Story Gains Traction
Amid the noise, the core financial narrative was reassuringly familiar: B3's business model is proving itself resilient. Total revenues grew 12% year-on-year to BRL 3.1 billion, despite a slowdown in procyclical revenue. The most striking number was the 17% growth in recurring revenues, which now account for about half of the total. Milanez explained the dynamic: “in the second quarter, the recurring part of the business growing around 17%, the cyclical part still growing in relation to last year, but much less than it did in the first quarter, a combined growth between derivatives and equities of 8%, allowing the company to deliver a top line growth of 12%.” — Andre Milanez, Chief Financial Officer (CFO) · 2026-08-12
This is a story shareholders heard before. In the prior quarter (Q1 2026), management stressed that the non-cyclical businesses could sustain double-digit growth. As they put it then, “we do believe that those businesses can continue to grow double digits” — Andre Milanez, Chief Financial Officer (CFO) · 2026-02-27. The consistency here is notable—the recurring revenues are not just a one-quarter phenomenon; they are becoming the anchor of the model. The equity market's deceleration (cash equities ADTV fell 20% year-on-year) and a flattish quarter-on-quarter trend in the "safer" lines were framed as seasonality and product timing, not structural slippage.
New Products: From Prediction Markets to Trade Receivables
B3's product pipeline was a centerpiece of the call. The launch of financial event contracts linked to GDP and inflation marks the company's official entry into prediction market. Milanez noted that institutional demand is already appearing for the inflation product, and while he cautioned that none of these will move the needle in the very near term, they collectively support a long-term growth narrative. The assisted production phase of the electronic trade receivables market is another key initiative, one Milanez flagged as a genuinely new business: “all of those, I think, are important initiatives that will contribute to future and sustainable growth for the company in the coming years.” — Andre Milanez, Chief Financial Officer (CFO) · 2026-08-12
This is a continuation of the strategy laid out in prior calls—Q1 2026 had management saying: "we are moving towards this agenda of prediction markets, digital options." The difference now is that the products are actually launching. The company also began testing its stablecoin, B3RL, and expanded assets eligible for RLP, underscoring its ambition to expand beyond the core exchange business.
Challenges: Taxes, Competition, and Election Season
The tax environment is a genuine headwind. Brazil's social contribution rate increased from 34% to 37% effective April 2026, and further increases are scheduled for 2028. Milanez acknowledged that the company is studying ways to mitigate the impact, including potential changes to legal entity structure, but he was clear that no near-term solution is on the table. The non-recurring interest on capital (IoC) is partially offsetting the hit this year—B3 announced BRL 1.1 billion in IoC, including BRL 750 million non-recurring—but that buffer will run out.
Competition also looms. The antitrust case regarding OTC and derivatives is still unresolved, and Milanez conceded that the recommendations are broad and could take up to a year to play out, though he downplayed any revenue impact. On the election front, he offered historical color: volumes typically dip about 20% during election years in the seasonally weak July period, but August has already seen a recovery. That pattern, combined with the new CEO's focus on client-centric technology, leaves the market with a clear sense of what B3 is trying to build: a more diversified, more resilient, and more innovative exchange, even if the near-term numbers remain volatile.