PagSeguro Digital : 2Q19 RESULTS WEBCAST SPEECH

2Q19 RESULTS

WEBCAST SPEECH

SUMÁRIO
RICARDO DUTRA | CHIEF EXECUTIVE OFFICER..............................................................................	3
LUIZ FRIAS | FOUNDER AND CHAIRMAN..........................................................................................	3
RICARDO DUTRA | CHIEF EXECUTIVE OFFICER..............................................................................	6
SLIDE 03 .............................................................................................................................................	6
SLIDE 04 .............................................................................................................................................	7
SLIDE 05 .............................................................................................................................................	7
SLIDE 06 .............................................................................................................................................	7
SLIDE 07 .............................................................................................................................................	8
SLIDE 08 .............................................................................................................................................	8
EDUARDO ALCARO | CHIEF FINANCIAL OFFICER..........................................................................	9
SLIDE 09 .............................................................................................................................................	9
SLIDE 10 .............................................................................................................................................	9
SLIDE 11 ...........................................................................................................................................	10
SLIDE 12 ...........................................................................................................................................	10
SLIDE 13 ...........................................................................................................................................	11
RICARDO DUTRA | CHIEF EXECUTIVE OFFICER............................................................................	12
SLIDE 14 ...........................................................................................................................................	12
SLIDE 15 ...........................................................................................................................................	12
SLIDE 16 ...........................................................................................................................................	13
SLIDE 17 ...........................................................................................................................................	13
SLIDE 18 ...........................................................................................................................................	13
SLIDE 19 ...........................................................................................................................................	13
SLIDE 20 ...........................................................................................................................................	14

2

RICARDO DUTRA | CHIEF EXECUTIVE OFFICER

Hello everyone and welcome to our second quarter results conference call. Tonight, I have here with me Eduardo Alcaro, our Chief Financial Officer, and André Cazotto, our Head of Investor Relations.

Before we get started, I would like to say a few words about competition. Although we have been watching aggressive competition constantly and poorly trying to replicate our business model, we continue to deliver strong results.

We would like to reiterate thatwe continue to focus on the longtail market taking advantage of being the first mover with the best and most complete digital banking ecosystem and by having unreplicable strengths, such as UOL online distribution.

We continue to operate in an untouched market. Still today, 80% of the new devices are sold for merchants that do not accept cards.We do not play the "zero-sum game". Competition does every day in their useless struggle. Our price fits alland isin the platform. And there is nonegotiation at the platform.

Therefore, we have delivered in this quarter the same consistent performance we have been delivering since our IPO:healthy net adds growth and stable take rates. In addition, we are now seeinghigher adoption of new banking products and services generating more engagement and adouble-digit growth in average spending per merchant year over year.

And before we go through the operational and financial metrics, I would like to play a 2-minute audio with Luiz Frias, our founderand chairman.

LUIZ FRIAS | FOUNDER AND CHAIRMAN

Hello everyone!

I would like to say a few words abouthow we see the banking Industry evolving in the next years andhow our company is uniquely prepared to surf this incredible wave that is transforming Banking as never seen before.

Amazingly we saw the Internet transforming several industries in the last 25 years. One of the first industries was music, followed by newspapers and magazines. Then the whole media reaching video entertainment. Today, almost all our economic activity has been impacted by the Internet. One of the last industries to resist was Banking. But now Banking is changing. The Internet is finally

transforming Banking.

3

To be competitive in this new Banking Era, companies must have a tech DNA, understand local needs and deal with local governments and local regulators. But most important, probably the unbeatable advantage, they must be the first mover. They must have the first mover scale advantage.

Scale is not only a fancy word in the Internet. It is also fundamental in Banking. Scale defines retail banking and retail has always been the core of Banking.

But while in the world of "search and social networks" scale is global, in retail Banking

scale is local. This is why after so many decades of globalization, retail Banking is still localin developed markets like America, Europe, and Japan as well as in emerging markets like Brazil. Global retail Banking is a tough business. Global scale does not apply to retail Banking. The scale that counts for retail is local. As an example, in Brazil, a global bank like HSBC didn't have a local scaleto compete against Itaú and Bradesco, the local banks.

We see digital retail banking through mobile and we believe to be likely to see some similarities between major Internet stories (like search and social networks) and the Banking Industry transformation to come.

Remember Google+? The dispute in the early social network market between the mighty "Goliath" Google trying to compete against the first mover "David" Facebook? Bingo, David beat Goliath! First mover wins.

PAGS is tech, PAGS is the first mover, and PAGS is local.

With that in mind we are pleased to share with you the beginning of a new banking strategy with PagBank, officially launched last May. We are also pleased to say that PAGShas reached a spectacular figure of 9.4 millionunique active users. These 9.4 millionunique active accounts are 4.7 millionunique active merchants plus 4.7 millionunique active accounts consisting of online buyers - using PAGSdigital wallet - and PagBankconsumers. Out of the 9.4 millionunique active accounts we have 1.4 million PagBankunique active users. All of them have at least one single transaction in the last 12 months in order to be considered active.

PagBankwas launched through a massive national online and offline marketing campaign to promote the new brand and its new products.

WithPagBank,our market is expanded by 14 times! It is 14 times larger than the

payments market. PagBank´soffering represents a real opportunity to cross sell additional products and to expand our relationship not only with the 4.7 millionmerchants, but also with our 4.7 millionunique online buyers and PagBankconsumers.

4

The9.4 million unique active users reinforce thatPAGS is today much more than a

Payments Company. Most importantly, it shows our leading position in digital Banking. We are the largest digital bank according to Google Trends and the largest prepaid card issuer.

We continue to believe that the digital banking revolution is disrupting the way Banking is offered. Digital,self-service,simple,price-transparentand affordablefinancial products are changing lives around the world. Including Brazil!

Brazil is a country with a reasonable telecom infrastructure (98% 3G coverage), a huge smartphone penetration and a massive internet usage (5th largest internet audience in the world). In addition, PagBankis leveraged by UOLonline distribution. UOLcovers 87% of the Brazilian Internet Audience. UOLis a relevant and exclusive ally to democratize and lead the digital revolution in financial services. Just like UOLdid for PagSeguroin payments.

There is a blue ocean of opportunities in financial services and a huge number of unbanked people willing to adopt digital solutions and new disruptive finance products.

We believe PagBankcan capture part of the total revenue pool that is 14xbigger than the payments market. And we believe we will continue to lead digital banking transformation in Brazil in years to come.

This strong momentum reflects our strong fundamentals.

PAGS is uniquely positioned because it was thefirst mover to create a business model and solution for the "long tail market" by offering adigital, simple, self-service,price-transparent, complete and affordable finance ecosystem and by havingUOL as anexclusive online distributor among other things.

Being the first mover, investing in people, R&D, products, distribution and branding in the last 13 years brings to PAGSa natural advantage.

Thank you for your time and now, I will turn the conference over to Ricardo.

5

RICARDO DUTRA | CHIEF EXECUTIVE OFFICER

Now, we start our presentation highlighting the great achievements of the quarter.

SLIDE 03

Starting with our solid results: Non-GAAPNet incometo reach 343 million reais, up 42% year over year,and 5% quarter over quarter, with a Net marginat 25%. Our Adjusted Net Revenuereached 1.3 billion reais, up 53% year over yearand our net take rateended at 3.23%, up 11 basis points quarter over quarter.

Moving to our Operating figures, we ended the quarter with 9.4 million active unique users, which means active merchants, active PagBankconsumers and online buyers using our wallets that did at least one single transaction in the past 12 months. Our TPVreached 26.8 billion reais, up 59%year over year, closing the quarter with 4.7 million active merchants,adding 1.2 millionwhen compared to the second quarter 2018.

Ouraverage spending per merchant in Q2 2019 reached5.9 thousand reais, up15% year over year. We believe the adoption of additional features through the digital account will be translated into higher stickiness and more transactions.Our goal is to be the merchants' final money

destination.

These figures reinforce not only that we are in the right path with a broad ecosystem, but also our execution capability.

Now moving to PagBank, we had 2.5 million downloadsin the quarter. Our customer average balancegrew 58%year over year, pointing that over time our active users see PAGSas their final money destination. We also ended the quarter with 1.4 million PagBank active users, which means merchants, online buyers and consumersadopting, at least, one additional product or feature beyond acquiring services, considering at least one transaction in the last twelve months.

Finally,PagSeguro has proven thatoperating and winning in the long tail requires an online and mobile approach that is totally different from the traditional acquiring business model and new competitors that were attracted to the market after our IPO.

We operate in a brand-new market that we created, and we still have a long way to go, constantly putting into practice our vision, to disrupt and democratize financial services through technology and innovation.

6

SLIDE 04

Moving to the next slide. We believe PAGS is well positioned and with a robust ecosystem that combines payments, lending, banking and software products to serve our more than 9.4 million active unique users and new customers we will acquire in the future.By upselling new products like credit, banking and software and expanding our approach to consumers, we will multiply our market. Considering the new initiatives already available for merchants and consumers, we estimate the revenue pool is almost 14x larger than payments market.

Being the first mover, having a robust and low-cost ecosystem, with 9.4 million unique active digital accounts, mobile first, strong brand, focus in user experience, the best rated financial services app on Google and Apple stores, and unreplicable online distribution through UOL, brings to PAGS a natural advantage to lead the market.

SLIDE 05

On slide 05, we start presenting some figures about the potential market. According to IBGE and Brazilian Central Bank, there are 68 million unbanked people in Brazil. Additionally, 28 million of thelow-incomepopulation do not have a bankand 57% of the population are interested in adopting digital banks.

Still,40% of the paychecks are paid in cash,65% of the bill payments are also made in cash and, finally,51% of the new bank accounts are opened just to receive payroll checks.

SLIDE 06

On slide 06,PAGS is leading the digital transformation and democratizing financial services.

Brazil already has a solid infrastructure, with 3G networkcovering 98%of the Brazilian population, while 96%already count with 4G coverage. And the smartphonepenetration in the country reached 71% of the Brazilian population.

When it comes to global internet figures, Brazil is one the most relevant countries, being the fifth largest country in number of internet users, fourth in time spent on internetand the second one in time spent in social media.

And when it comes to our relevant and unique positioning to capture this digital transformation, it is worth to remind that UOL has 87% internet audiencecoverage in the country, with 105 million

unique monthly users as of June 2019.

7

SLIDE 07

On the next slide, we present our outstanding and encouraging results. We ended the quarter with 1.4 million active users. It means merchants, online buyers using PAGS digital wallet and consumers that use at least on additional product or feature beyond acquiring.

Our PagBankapp was rated at 4.8 stars in Android and iOS, being the best rated app among payments and digital banks peers according to more than 600 thousand reviews and PagSegurois also the largest digital bank searched by Google.

We had58% increase in thedigital accounts average balance year over year, reflecting the higher adoption and usage of the new products; and according to internal survey with our clients,94% of the users would hire products and services offered byPagBank.

Additionally, we ended the quarter with over 2.5 million downloads, growing almost 200% year over year and 75 million logins on PagBankapp during the quarter, a record in our history.

Those initial figures indicate we are in the right path and we will keep enhancing our ecosystem in order to increasePagBank usage.

SLIDE 08

Moving to slide 08, we provide some additional color about our lending product, PAGS Capital.

We are gradually scaling the product to our best merchants, eligible according to their account history, TPV behavior and payment frequency. Since the beginning of the operations in May 2018, we reached 26 thousand lending contracts. In Q2 2019 we had 14 timesmore contracts than what we had in Q4 2018 and ended with a total credit portfolionet of losses of 132 million reais. So far, we are being careful with credit, however these initial results are encouraging, as we had very low level of delinquency. Credit is an important tool to create higher engagement with our merchant base and may generate additional revenues for the company in the future.

Now I would like to turn the conference over Eduardo.

8

EDUARDO ALCARO | CHIEF FINANCIAL OFFICER

Thanks Ricardo, and hello everyone!

SLIDE 09

On the next slide, before I start, I would like to mention that in the second quarter of 2019 we had a total of 20.1 million reaisof non-GAAP items related to our stock-basedlong-termincentive plan. In addition, I would like to remind you that in the next quarter we will have the vesting of the 4th grant of the initial stock-based plan like we had in the third quarter of 2018. Based on the current stock price, we estimate aone-timenet income market to market adjustment of approximately 50 million reais on the top of the quarterly recurrent provision. For more details, the reconciliation of these non-GAAP financial measures is presented in the last page of this webcast presentation.

On the top left of slide 9, our Adjusted Net Revenue, the sum of net revenues from transactions and financial income from installments reached 1,296 million reaisin this quarter, up 53%year over year and 13%quarter over quarter. We believe that these two operational revenue and income lines best represent our core business which grows at healthy high double-digit rates.

On the other hand, despite any mix effect, our MDR prices are public in our website and remained the same quarter over quarter having the benefit from additional products and services of our Digital accounts.

Moving to the top right, we have our main revenue streams, composed by transaction services, financial income from the installment prepayment and hardware sales.

In the second quarter of 2019, transaction and servicesrepresented 59%, financial income 37%, and hardware salesonly 5%over total net revenues that continue to trend down as expected.

On the chart below, we present our non-GAAPtotal costs and expensesthat decreased 0.4 percentage pointsyear over year, ending the second quarter at 3.4%over total TPV. Related to non- GAAP Administrative Expenses, over total TPV, reached 0.3%, flat when compared to one year ago.

SLIDE 10

On the next slide, we show our non-GAAPNet Incomegrowth. In the second quarter we reached 343 million reais, an increase of 101 million reaisand up 42%year over year. The non- GAAP Net Marginreached 25%, remaining stable even with higher hardware subsidies and new Marketing expenses related to the PagBank campaign in the quarter.

9

SLIDE 11

On slide 11, we have mapped thecurrent functionalities of our unique ecosystem broken

by Payments, Software and Banking features. You can see thatthere are four new features we launched after our first quarter earnings call and I will give more details about them in the next slides. On the superior block, there are features oriented to merchants. Instant payments and Sales app in the software column are the new ones.

Below, you can see our robust banking ecosystem. Credit and cash cards, as well as Payroll portability are the new launched features. We believe these banking features will enable us to attract, engage and monetize both merchants and consumers, helping us to improve our merchants´ loyalty and stickiness creating more and more engagement.

The total market of banking and credit is 14 times larger than the payments market, andPAGS is well positioned to reach this new market.

SLIDE 12

Moving forward to the next slide, we have our number of Total Unique Active Accounts.

Let me first remind you our criteria again, since this is the first time we are sharing this metric. These 9.4 million unique active accountsare 4.7 million unique active merchants, plus 4.7 million unique active accountsconsisting primarily of online buyers- using PAGS digital wallet - and new PagBank consumers. All of them have at least one single transaction in the last 12 months in order to be considered active.

It is important to remember that PAGSstarted its business as an online digital wallet provider before entering in the POS market back in 2013, so we have a large number of unique active online buyers holding our e-wallet for ecommerce purchases in our online check-outs, just like Paypal, generating TPV but not monetized as consumers, and now through PAGBANKwe will offer products and services for them, with the advantage of already having their purchase profile and this is the reason why we began to share this additional metric since our value proposition goes beyond merchants and acquiring services, and we are expanding our capabilities to a new pool of services and consequently users.As we mentioned earlier, from the 9.4 million total unique active accounts, 1.4 million are PagBank active users.

10

SLIDE 13

On slide 13, we have the evolution of our average spending per merchantthat reached 5.9 thousand reaisin Q2, a growth of 15%year over year. This strong and continued growth is explained by the higher adoption curve of our solution in our merchant base, which is an expected trend, higher engagement in our ecosystem being converted in more transactions and TPV. Just reminding what we said in the initial remarks, most of our merchants did not accept cards before joining PagSeguro. This is a blue ocean and a new market created by PagSeguroas we are not stealing clients from competition.

In the next chart, we have our number of Active merchants.

Just to explain the criteria we use internally: active merchants are those who made at least

one single transaction in the last twelve months.

We ended the second quarter reaching 4.7 millionactive merchants, adding more than 1.2 million new merchants in one year, representing an increase of 35%year over year. Quarter over quarter, we added 296 thousand new merchants.

On the charts below, we see our TPV.

Our total payment volume reached 26.8 billion reaisin the second quarter, an increase of almost 10 billion reais, up 59%year over year, and growing almost 10%quarter over quarter.

This growth is the result of a higher penetration of our ecosystem in the long tail combined with the trend of "cash to plastic" conversion that is still at the beginning in our merchant base with lots of room to grow in Brazil and having the upside of cross selling additional products and services to our clients with our PagBank initiative.

The Net take rate, which is the blended take rate net from transactions costs such as interchange, processing and cards scheme fees, reached 3.23%in Q2 2019, or 11 basis pointsup when compared to previous quarter.

Now I would like to turn the conference over to Ricardowho will talk about engagement metrics and new products.

11

RICARDO DUTRA | CHIEF EXECUTIVE OFFICER

Thanks Eduardo!

SLIDE 14

On slide 14, we show some of themost relevant engagement trends in our ecosystem. We believe engagement is one of the most relevant metrics to follow, once it will help the company to increase the switching cost, add more transactions and TPV and will enable future monetization and revenue diversification.

On the top of the chart, we have the number of active prepaid cardsthat increased 78%in 2Q19 when compared to 2Q18. According to Card Monitor, PAGS is the largest prepaid card issuer in Brazil. Additionally, we also have the volume of prepaid cardstop-ups, that increased 75%when compared to the same period in 2018.

In the chart below, we see the number of bill payment transactionsrose 719%since its launching back in the second quarter of 2018, reaching 1 million transactions in the quarter. Our mobile top upfeature is also ramping up, growing almost 400%percent when compared to 4Q18, when we launched it, and 84%growth quarter over quarter.

SLIDE 15

In the next slide, we have the evolution of our additional revenues growth, or revenues generated by new products in our ecosystem such as lending, cards, software and others, that grew 131%year over year.

Additionally, we have the evolution of our P2P transfers, that started to get traction and already grew 474%when compared to 4Q18 and 39%quarter over quarter.

On the chart below, we have also the customer average balancethat increased 58%year over year, showing that through new products and features more and more our merchants are seeing our digital account as their final money destination.

Finally, we see the evolution of new transaction methods like NFC. Our TPV through near field communicationor contactless increased 92%quarter over quarter. We believe that offering NFC and QR code acceptance in our terminals and in our wallet increases the value proposition to our customers.

12

SLIDE 16

On slide 16, we highlight our roadmap of productsalready delivered in the year. Being an independent company allows us to think exclusively on our clients' financial needs, by delivering growth and profitability simultaneously and offering a unique ecosystem through our digital account. With cash and credit cards and payroll portability, we expect to diversify our addressable market and start gaining penetration with the consumer vertical, besides our higher engagement on the merchant segment. Worth to say we will be very cautious in the credit offer as we know it is important to understand credit behavior so that we can manage delinquency accordingly.

SLIDE 17

On slide 17, we can see thestrength of our brand. PAGS is the first mover in this market and the fact it can access UOL audience, the third largest online audience in Brazil, only behind Google and Facebook, with more than 87% internet reach as of June 2019, to promote our products and solutions in the long tail market, helpedPAGS to reach a unique brand recognition. In the past twelve months, according to Google Trends, filtering by the Financials Category,we have on average approximately 6 times more searches than the second player. PAGS reached a level of branding awareness where the business has a "word of mouth" effect, and consequently, we have lower acquisition costs than our competitors.

SLIDE 18

On the slide 18, we show our new device, Minizinha Chip 2. An upgraded version of our entry level device, with a promotional price of 12 installments of 9.90 reais or 118.80 reais. This device is NFC enabled and comes with the usual sim card and larger screen, combined with a thinner hardware. It will offer a better user experience forself-employedsegment.

SLIDE 19

Moving to the next slide, we present our software solutions.

Through M&A transactions, we now have TILIX, an automated application that innovate the customer experience in paying bills. From Utilities to Tax bills, Tilix offers a simple and user-friendly interface to manage bill payments and will be fully integrated in our digital account app in the following months. We also have R2tech, a company acquired in 2017, that offers a streamline process of credit card transactions reconciliation. And finally, NetPOSthat provides ERP software to retail and foodservice segment.

13

Built for front and back office, with sales and management tools like inventory control, detailed reports, cash management and invoicing, NetPOS will be fully integrated with PAGS´s mPOS, POS and SmartPOS devices as well in our PAGS´s sales app. We had 84 thousand clients using our software products by the end of June 2019.

PAGS will continue to monitor possible M&A activities that can speed up the building of a more complete ecosystem.

SLIDE 20

Finally, on the next slide we show our new acquisition. After Tilix and NetPOS, Yamí is the

third software acquisition in the year.

Yamí is a back-office platform for ecommerce and marketplace, helping online merchant to run their businesses and is compatible with the major e-commerce SaaS platforms, such as VTEX and Oracle

Yamí provides a relevant product in Brazil for ecommerce exchanges and returns and it is the first PCI gateway specialized in payment splits.

Additionally, Yamí works with more than 100 fashion online stores, a segment where exchanges and returns are recurrent, which adds some complexity to transactions, requires split payments and so on.

Now we finish our presentation and we will start the Q&A session.

14