Morning to all, and thank you for waiting. Welcome to this earnings call for the Q3 of 2024 for the Grupo Casas Bahia. For those who need simultaneous translation, there is a tool available on the platform. Click on the Interpretation Globe on the lower part of your screen and choose your preferred language. For those who are listening to the call in English, mute the original audio in Portuguese by clicking Mute Original Audio. This video call is being recorded and will be made available on the company's investor relations website on the address RI Grupo Casas Bahia, where all of the material will be available. You can download the presentation as well on the chat icon in English as well. During the company's presentation, all participants will be muted. Then we will begin the questions and answers session.
We'd like to highlight that the information contained in this presentation and any statements made during this earnings call related to business perspectives, financial projections are based on premises and beliefs of the company, as well as information currently available. Future considerations are not guarantees of performance. They involve risks and uncertainties because they are in relation to future events, so they depend on circumstances that may or may not occur. Investors should understand that general economic and market conditions and other operational aspects may affect the future performance of the company and may result in different results than those presented here. Today, we have the presence of the executives of the company, Renato Franklin, CEO, Elcio Ito, CFO and IRO, and Gabriel Succar, Head of Investor Relations. I pass the floor to Mr. Renato Franklin.
Hello, good morning to all. Thank you, Rodrigo, and thank you everyone for your presence. We are here to talk about the results of the Q3 of 2024. I'll make a quick presentation on the main highlights, and then we'll open to questions to be able to get into the details that you would like more information on. First of all, I'd like to highlight that we are very satisfied with the results of the Q3. We had a very bold transformation process that we presented to the market in August. We had no pushback in relation to the direction. We were all very focused on the challenge of executing this plan, and we have been executing it very well. W e are presenting a sequential improvement of the operational margins. We were able to anticipate some leverages. We started growing in physical stores.
In the beginning, there was an impact of the removal of some categories that were not selling on physical stores and more on e-commerce. T he core sales are better in several categories, and we start seeing growth in physical store sales, which is more and more positive. There's also the growth of the credit. T he main core of the business is what I will talk about. A nother milestone is the increase of liquidity. T he operations, the profilation of the delivery of the plan, the business plan of the business, allowed us to access the credit market and improve the liquidity of the company slowly. W e will talk more about these drivers, and we will continue to evolve with the company and correct the capital structure.
One thing is going to help us do the other so that we can have a stable and sustainable future for expenses. T he Q3 in gross margin, we had a gain, a significant gain over the Q3 of 2023 that was impacted by the balance of 0 percentage point over 2024 and maintaining our commitment of constant evolution, a sequential improvement on the liquidity of the business, a large material gain over the Q3 of 2023, which was impacted by other structures, and now coming into 0.7 percentage point over 2024. Once again, our commitment of delivering gradual growth of the operational margins of the business. The growth of GMV in physical stores was 5% per year, same store sales 6.5%, and 3P growing in core.
Here it's important to highlight that we grew at this percentage not because of the migration of categories. Our 3P is a marketplace and specialized players. So domestic direct clients for furniture. This grows with accessories or HDI cables or SKUs that we have where we do not have a 3P because the commercial margin is better to have a 3P than a 1P. So it is growing, and we are seeing that it will grow a lot more and contribute to the strategy for 3P that will be beginning in 2025 to increase the fulfillment, increasing the level of services of the core items on our marketplace. Another point is credit. We reached BRL 3.1 billion , so a growth of BRL 150 million from the previous quarter. We maintained this growth.
There is a demand, and we are growing with clients that we already know and with a better network, improving the health of credit and a better marketplace and gradual improvement of the health of credit indicators. Besides these that I mentioned, we increased to BRL 3 billion of liquidity, and we also had unification of logistics operations of [inaudible] full. You know that we have a huge logistics operation for the company, and we created a brand for the second line of business, which has an important growth plan to consolidate us as a logistical national player for heavy and light goods for macro growth to take advantage of the existing structure for the company. Please go on to the next slide. Here is a quick comment on the brand. The brand Casas Bahia is very strong.
It's been top of mind for 19 consecutive years, but the second highlight is very important. It was the most remembered brand between all of the industries in all of the sector of the Southeast region. So if you ask for a brand for services or products, Casas Bahia is the most remembered brand in the Southeastern region. This shows the strength of our brand and the potential that we have for growth. After improving our operations, now we have a more lean structure, and we can capture operational leverages and correct the capital structure so we can unleash all of the potential for growth that this company has. Next slide, please. Talking about GMV, here we have a highlight of the priority of physical stores, as I commented, 6.5% of same store sales.
We see this number growing a bit more in the Q4 with a positive trend, and the online line is reducing since a few categories have left. We are increasing in the core. We will be reducing this drop so it can start contributing to growth again. Our priority is not GMV. Our priority is the margin of contribution. So the highlight here is we have corrected the margin of contribution of all of our channels of sales. Now all of the channels have positive contributions, and we can still see improvements for the margin of contribution of every channel. And obviously, as we increase the GMV principally in physical stores, this will contribute to the physical costs and increase the sales online for us to reach our plan for 2025 of having a profitable and healthy company. Next slide, please. Let's talk about credit of our core.
So the growth is very important. It contributes to the gross margin and to the results of the company. But two things are important to highlight. First of all, we will not run any credit risks. We will grow in the best network. So you can see that we've reached 9.4%. It went to 8.5% and 8.4%. So this shows that the trend of default is positive. PDD, which is done when we already issued the contract, we already provisioned it. It's also dropping, and it's performing the improvement in the mix of clients. It's important to highlight when the macro scenario is more restrictive with higher interest rates, the addressable market increases with clients that are even more positive. So we see a capacity of maintaining this rhythm of growth, improving the health of our credit structure even better.
When we look at the liquid losses, it's stable at 7%. This is what we have as a guidance, and it has been working in a very controlled manner. Production is record with a lot of growth. This is transformative because this shows the capacity for growth of the company, and we are very confident of demonstrating this. We have BRL 2 billion per quarter, and we will be performing another record in the quarter of 2023, where we already announced yesterday the availability of BRL 1 billion in credits for consumers for the month of November, which is Black Friday. This is being expanded for the whole month, which will increase the credit, maintaining selectivity in our default indicators in healthy credit levels, which will contribute to us having lower default rates. Next slide to talk about logistics. What is CB Full?
CB Full basically is that the company has large logistical services for our GMV that we manage. So we bought [JetLog]. This is already five million of our GMV. We are going to grow in our own GMV as well. And we brought CNT in the past in order to carry out fulfillment. These two businesses combined allow us to offer many kinds of logistical services, open last mile storage, and then e-commerce for clients. So here we have 25 clients in the last mile, 40 clients for storage, medium and large size clients. We already have one billion in the open sea of GMV here, and we already have coverage for the delivery of all of the municipalities in Brazil. This was very important. We wanted to do this before launching the new brand because we are launching the brand now.
What is our path, to improve and create a catalog so that we can sell this in a scalable way. We see a huge potential for growth without having to allocate more capital. CB Full will grow with its own cash flow, investing in the gains of operation. Since the structure already exists, it will contribute to dilute the structure that exists today and the costs of the Casas Bahia Group and bring a contribution with this service rendering that can contribute to the bottom line of the company. Of course, it's still delicate as a whole, but there will be a lot of growth. We expect to double it in 2025 so that it can be very relevant in the Brazilian logistics market. Next slide, please, to talk about fulfillment. The Full Cross is a new service that we launched.
We launched this pilot last year with a small project, and we closed and started operating in this player. There are a lot of small players and medium-sized players, and there are large players that are migrating 100% of their logistical model to Full Cross. What is Full Cross? Basically, traditional logistics industry discusses a sell-in, and when they close a deal, they deliver the product, and then I have to pay them in the decided-on terms. So then Full Cross is I segregate a space for the operation of the industry. The industry starts to rent their stock inside of my warehouse. So I'm providing warehouse services. I can also do this for other logistical operators inside of my warehouse. And we integrate the system in such a way that I have visibility of the stock. So I do not need to buy to sell.
I can make the sale possible online or on physical stores for clients to receive them in their houses or for them to pick it up, and I can leverage sales with more assortment because the stores can have more assortment. They can sell to other players. I leave that one CDN, and I can deliver to other clients, and when I sell, I buy from them and I deliver to clients, so this is going to be transformative for the industry of retail in Brazil because it will increase our working capital in the industry. We will see a sell-out per day, and we will be able to deliver on the next day what the sell-out was for the previous day. The objective line, because they both are concentrated on the sell-out here, we are concentrating on the cost of transportation, which drops.
Today you have to fight for the sell-in, and in the past, we had to deliver it all at the same time. This part is more complex. I need more trucks. Every day you have to have a truck delivering, and we're able to provide this in a more consistent way, as foreseen, and in a stable way. It's much more, i t's much more cheaper for stock, and it improves the disruption. If we deliver 4,000 products in a day, it's better than doing it one in a month. When you have to, when you do it in a month, the store can sell more because they don't have the lack of stock. If the store receives too much stock, then you're paying for that cost of capital.
So when we can adjust it on a daily rate, it's more agile to be able to correct demand situations, and we always have the correct stock and be more assertive with our stock. So we see this will be contributing to the correction of the company's capital structure and the improvement of the structure of the company's capital. Then below retail media, here we have numbers. We already talked about this tool when we launched an AI solution for relevant clients on the website. This is growing our gross revenue at 410%. The ROAS was growing at 24%, much more than marketplaces. So it's a very good business because you're at the end of the funnel for items that are core items, and we see a lot of potential here in the retail media in order to continue growing next year, at least doubling what we did this year.
Please go to the next slide. Now, in general, we have the credits growing in penetration in physical and digital arenas. We have financial solutions in general growing at 38% for financial service solutions. The 3P solution is growing at 24% and retail media growing in services and services growing at 38%. This is far from the potential. These are leverages that will make it possible for us to increase our gross margin. We believe that we have a large commercial sale and the growth will not bring additional discounts from the industry. It will be an increase of the participation in accessory services, and it will monetize our ecosystem and will allow us to have a company that is more profitable and sustainable in which we can begin the cycle of expansion after the end of 2025. Let's go to the next slide, please.
Next slide to talk about the transformational plan. The transformation plan continues to work well. We are still at 20% higher than the timing. I think this is a good business. We recovered lost time with the credit, so we had a fatigue that left in the beginning of 2024, and we were not able to increase, so the credit production was repressed in the Q1. We were working with less revenue than was forecast, and we were able to recover this growth, and we are going to recover growth in the year higher than we expected, so for 2025, we are within the plan, and we will be able to deliver the plan of 2025 in relation to credit. At which moment are we today? The investment of selections that we have, so we entered with AI. Pricing is already working.
We are already running at 80% of the online prices with AI. That has improved e-commerce margins and will allow us to have growth in e-commerce and we started tests in physical stores. This will also allow us to gain market share in physical stores. Physical stores are still in a pilot process, and the impact we'll see more in 2025. E-commerce will start showing its impacts in the Q4 of 2024. Obviously, the algorithm will be learning, and we will be learning with the algorithms as well and whatever we need to correct will bring constant evolution. The other is the digital solution of advanced analytics in the hands of salesmen, so the app that the sales representatives have for their stores, they have an AI to support them. What margins do they have?
And the sales reps are stimulated to work with online leads when they are with idle time to bring new clients to stores through online sales or through WhatsApp. This has been giving us very good returns. We increased 25% of productivity from our salespersons, and until the end of 2025, we will increase our sales and reduce SG&A and increase the sales in the WhatsApp channels of sales. So we already talked about retail media and 3P. So this is what we are doing in the transformational model. Now I'll pass the floor to Elcio to talk about the financial highlights.
Thank you, Renato. Good morning, everyone. As always, I would like to start talking about our discipline in the execution of the transformational plan we announced on the 10th of October of last year that we've always maintained the consistency of our discourse and the discipline of execution.
This has been our guidance since the beginning, and so for the leads or the financial highlights, the gross margin of 31.3%, an increase, a high increase in relation of last year, 8 percentage points. Obviously, last year, if you remember, we were focusing on reducing our old stock. We had to have huge discounts, and that impacted the margins of last year. That's why the operation was a bit unusual, but the relevant aspect is the sequential evolution in relation to the Q2 of this year with the increase of 0.9 percentage points in relation to SG&A. Our commitment to have a lean structure when we look at the first nine months of the year, there is an accumulated reduction of BRL 336 million.
Unlike in the past, when we would talk about BRL 350 or BRL 350 million per year, now we have an even higher value in relation to SG&A than what we estimated in the beginning of the plan. Combining the gross margin with SG&A, with discipline, led us to an EBITDA of 7.7% in the quarter. Once again, a sequential evolution in relation to the Q2, the fourth consecutive quarter of sequential improvements of our margin, even with the reduction of revenue. We've been talking about this for a long time of our strategy to focus in the core categories and profitability, cash flow, and even with the reduction of revenue, we've had improvement in margins. So preparation for Black Friday and Christmas, our stock is at BRL 470 million highs in relation to the previous quarter and the Q2 of this year.
Even then, we were able to advance in the monetization of taxes, and we closed the quarter with BRL 3.336 billion increase from the last quarter. The next slide tells us about, tells the story in numbers ever since the beginning of the transformation. So the focus of cash flow and profitability, we discontinued 36 categories in P and online, especially in B2B. We were able to close, we closed 16 stores that brought us the planned reduction in revenue, as the graph shows us on the higher left side of the slide. So the reduction of 3% during this quarter in comparison to the average of 14% from the previous quarter. So we have been observing a reduction of the total and increases in physical stores, as Renato already showed us previously. The lower left graph talks about SG&A, which we already commented on.
And on the second phase of the transformational plan, the focus is the growth of healthy revenue. So we have been talking about the expansion of physical stores and a trend of improvements for the Q4 and the focus on the online platform in a more assertive way. On the graphs, we see the sequential improvements within the gross margin and EBITDA margins reinforcing the aspects that Renato commented on. Besides the commercial execution, we have been advancing very strongly in services of credit and insurance, which has been improving gradually the structure of our margins. That was the beginning of the team. In the beginning of the plan, the risk was higher than expected. Now we are in a scenario, despite the macro scenario, maintaining the discipline of costs in which we are advancing in the increase of revenue. So the potential of operational leveraging.
So if we go to the next slide, we have the cash flow. The free cash flow is negative at BRL 70 million. It's important to highlight a few temporary events. So the first credit is BRL 700 million. It's a very positive vision for the company, not only because of the issues of the sale of merchandising, but it brings expressive improvements. So at the first moment, it even brings a negative impact of the result because of the initial production that is carried out, but also the increase of accounts receivable, increasing cash flow. And over the next weeks, we also have higher improvements in cash flow and also will be compensating over time. The second temporal aspect is related to seasonality, the increase of stocks in preparation for the Q4. Most of the increase of stock is compensated by accounts payable and integrality.
So there is the return of the working capital that occurs in the seasonality of the Q4. And the third important aspect, temporary impacts, is the monetization of tax credits in the quarter in net terms, BRL 17 million, even with the increase of stock. If there was none or if there was a maintenance of the stock levels, this monetization would be closer to BRL 300 million, as we have focused most of our attention on. So it's important to highlight that this leverage continues to be, we continue to be focused on this leverage. If we look at the last 12 months, we had a net monetization of BRL 1.5 million on this line. And finally, liquidity has closed at BRL 3.1 million. We already commented that we were able to increase the liquidity, which is not common when we observe the variations year over year.
We were able to advance and in a sequential way increase cash flow, so going into the Q4, that is favorable for the seasonality, but at the same time, planning and structuring the first compensation of a more challenging cash flow, as always, is the customer, so the cash flow is still an absolute priority for the company, and we're focusing on our objectives. Get back to you, Renato.
Well, great, thank you, Elcio, and now we can move on. I think we're getting to the key messages at this point in time, so first of all, the current moment, Black Friday, everyone was really concerned, but we were able to grow our stock. It's a really good stock level, just core items and new items.
We don't have like a huge backlog of sales of items that are going to hinder margins or good sale items and good depth, good quality. And so the teams are really engaged. We just boosted this with the Buy Now, Pay Later, the Crediário, and we can really unleash growth. Our limit for growth is really our selectivity in the rating, and we can reach BRL 1 million in November. This is a commitment. We're going to maximize sales, especially in the physical stores. Penetration with the Buy Now, Pay Later digitally now dropped a bit in Black Friday because of the high income consumers that really search for this a lot. And what's interesting is that the most searched items, we set up this model, and of course, here we're going to talk about Black, which is bringing even more profitability, right?
We have this unit where customers, we try to find what customers are most looking for on the internet, and we discount these items. This helps save and increase efficiency in marketing investments, and it gives me the capacity to invest more in pricing. I can reduce SG&A, add this to the price, and we maximize sales. It's working well. We're not going to have an exaggerated volume. It's going to be proportional, and the focus will be profitability, and we want to deliver the gradual improvement in our margins and improving the company, preparing the company for 2025 because we still have a lot to deliver when it comes to operations and profitability. Next, we'll get into our vision for 2025. We want to keep up the sequential improvement in the operational margins.
We want to continue with the Buy Now, Pay Later and increase this liquidity as well. So we also were able to have a re-rate when we grow our revenue, we're going to dilute our fixed costs more. So then the increase in margins we'll be delivering throughout our plan will obviously become a major revenue leverage. So you don't need to adjust structurally anymore to be able to adjust expenses. They were already adjusted, and the contribution margin is already higher. But the growth here in the revenue is going to lead to an important increase. So the Buy Now, Pay Later is working well. Everything's progressing well within the plan to have the funding with higher costs. And the impact that exists for this transformation plan is higher fundraising costs because interests are higher and spreads are a bit higher.
This will consume a bit more of our financial expenses. But our objective is to adjust this. Then, of course, you can change the funding pockets, and then afterwards, we'll still have some important levers, accelerating monetization of taxes and some assets, as Elcio already mentioned. Some of these assets we already had in our plan, and we postponed this monetization. The analysis is getting better. We can see that there's potential also to do some things in 2025 and operational adjustments as well. That will bring in benefits with more EBITDA margins and advances in the Full Cross. So with this, we can address this and finish with better leverage and really discuss the expansion plan. And then we'll present this strategic plan, and this is becoming more clear. And of course, keeping a leaner structure and increased operational efficiency.
So we're really prepared for the Q4, and we want to have a historical Black Friday and have a quarter that's going to be really important for this half of the transformational plan, showing the company and another trend, demonstrating what we could achieve with a lot more to do still, of course, but within the plan prepared so we can be convinced that by the end of 2025, we'll have another company with a lot of growth potential. I want to thank you all for your trust and for all of you guys with the apps downloaded and the active notifications. There's a lot to buy still, so thank you for that and we want to get into Q&A now so we can go deeper into certain points.
And so we have people raising their hand. Thank you, Elcio, and thank you, Renato. We're going to start off with the Q&A, and then good afternoon, everyone. The first question is from Pieter Santander. Pieter, you may proceed, please.
Hi, good afternoon, Renato, Elcio, and I said we have two questions. The first one is more focused on the pricing for the physical stores, and then it's clear you have the same story through the last few quarters and also the continuity in the beginning of the Q4. I just wanted to confirm this point if you still have this acceleration in the same stores, and also if you guys think this acceleration is more focused in the market or the share gains, and the second point is to explore a bit of the levers with the gross margin on our side. It really calls our attention to the growth of the financial revenues.
So in the Buy Now, Pay Later, what has been your guys' performance recently? And is there any relevant difference in the credit that's granted in physical stores and also digitally? Thank you so much.
Thank you, Pieter. Thank you for the questions. First, for the physical stores, same store sales, it's as planned, and this continues to grow. We're going to deliver growth upon the previous quarter that's greater. So Q4 versus Q4 is going to be better. October was pretty strong. The market was strong in October. And we start recovering shares. So when we look at the total share, since we eliminated some categories, we ended up kind of losing a bit of share, but this was recovered gradually in the Q3. But then in the Q4, we started reaching these similar levels.
And so we still have room for this to grow our share, getting back to what it was before. And we're kind of getting some tailwinds in some categories, especially as we grow as market conditions, recovering a bit of our market share in furniture. The market's growing a bit, and we're growing more than the market. We're gaining share and in other categories as well where we've kept our share, but we've been recovering a bit of the volume based on the market. So we see priorities in the physical store, but the dynamic pricing and adjustments also brought in some opportunities for e-commerce. In e-commerce, we have been working above two contribution points in margin. So if it's above two points, then growth starts generating value.
And so, some improvements in e-commerce will also bring in here to be able to contribute to the total GMV of the company. So, just very gradual and keeping up commitment with the bottom line. Gross margins, the financial results are really an important contribution, very relevant. And what's interesting is in the last batches, we were operating in line with what we were doing. And there's a bit of a cluster when you talk about the average rate. We have customers that are five and others that are 14. So, the profitability in the worst ratings are even a little better, but delinquency is a little worse. But when you grow more in the better rating, then our profitability is that the trend is that the profitability will drop a little bit, but the delinquency also improves a bit.
So this is for the growth of the delinquency of the Buy Now, Pay Later customers. We're going to see delinquency below 9% and net losses below 5%. So we're not going to face any risks by increasing the amplitude of the credit we're offering. We are willing to offer more installments or a smaller down payment for customers that have payment conditions that we know about and customers that are already company customers that know how to buy, and also the pre-approved credit granting, right, which is one of the best ratings we have as we work with this portfolio. And I think I answered both of your questions. Yeah, I just wanted to add on to this on financial solutions. Besides the Buy Now, Pay Later, we've been really expanding with this full package of financial solutions.
And so the sale of services, extended guarantees, and assembly install, this is all things we've been focusing a lot, right? From a ROIC perspective, you don't have allocated capital, and you have high margins, and that contributes significantly so that we can continue to advance in the gross margins. So there's still a lot of room in services.
Yeah, okay, thanks.
Thanks, Pieter. Thank you, Pieter. Our next question is from Felipe at Citibank. Felipe, you may proceed.
Hi there, team. On Citibank side, we want to understand the turnaround project when it comes to growth. You guys have done some significant work on the reduction of the stocks with lower margins, especially in 1P, but I want to understand how we can imagine the dynamic of the online for 2025. And here, is it the industry that's going to grow? How much do you expect the market to grow? Is it this demand from consumers? And I understand the idea is not to leave the core, but the second point is with the levers. So that was pretty clear in the quarter. And if you could show us a bit of your perspective for cash generation in 2025, that would be important. Thank you.
Well, thanks for the question. First of all, on growth, our priority is physical stores, right? Brick and mortars. So if we have limited capital, we want to use that in higher margin sales. E-com with the Buy Now, Pay Later is priority number two. So it's important. It can help us a little bit. Then we move on to the physical store without Buy Now, Pay Later. And then e-com, 3P is more profitable, and it doesn't require capital allocation.
So for this one, I don't have this limitation. 3P and e-commerce should probably continue to grow. And it also contributes to margin gain. So you get some good support in the gross margin. But when you look at the categories, this is valid to physical stores and also e-com. In physical stores with home appliances, that's been performing pretty well, and industry understands that it's going to continue to grow next year. But we have marginal gains, and this is especially for areas where we have a lot of space. I'm not going to give you too much details. But then for furniture, we have a lot of room. So for furniture, we're growing strongly above market levels. Furniture was kind of left aside for a while because it was less digital. 20% was online, 80% was physical. So there's still a lot of room for growth in furniture.
We were growing a lot this year, and we're going to continue to grow next year in furniture, which helps with the profitability penetration of our Buy Now, Pay Later program and also other services that help a lot with monetization, so it's something that really makes sense to us financially. Now, in the other categories, it's like growth according to the market. We don't expect to grow for the market when we're talking about technology, television, and cell phones because we have a deflation. We have an increase in our average screen size, and there's also the arrival of new suppliers for screens and cell phones, and that also helps us with our bargaining power to be able to work on some initiatives with investments from industry that can help capture a bit of the market.
But it's more like we're keeping up with the market leadership and competitive vantage point and contributing a bit more with the bottom line. So in e-com, there's an opportunity in these categories, which kind of gives us the possibility to work on our efficiency a bit more, then we can recover the previous share. And so now when we can recover the prior share, so there's some share gains, but they're recovering also what was the share in 2022 and 2023. So that's pretty much what we see to show you a bit of the dynamic when we discuss leverage. We haven't provided any guidance to the market, but we want to reach a positive cash flow. We want to finish the year at a whole other level, and the EBITDA needs to reach the end of the year with double digits. So this is the expected EBITDA growth.
In the Q4, we would have the company at a whole other level to be able to reach 26 with the conditions to operate in a sustainable manner with a free cash flow that covers the interest and generates value for shareholders.
Okay, guys, very clear. Thank you.
Thank you, Felipe. Our next question is from Alexandre Namioka at Morgan Stanley. Ale.
Hello, good afternoon, everyone, and thanks for taking my question. So just to focus a bit more on this point that you guys had mentioned on the market share gains for next year, I wanted to understand how much of investments would be necessary to accelerate the growth that you would need to work on in order to capture the additional share from industry. And the second question on my side is more like if you could help me understand the ecosystem side. It was really clear in the release. I think retail media is growing a lot, but if you could give us a little more color, maybe in regards to how much this is really like the advertising versus how much what's actually performance-related. Give us a little more details on the type of customers that are coming in through this type of service.
Okay. Well, first about market share, our CapEx should continue to be pretty similar to this year. So I don't really plan to increase investments in CapEx and marketing as well. So we're gaining efficiency, and when we look at this compared to the revenue, we see that there's a market share gain for a certain period of time. We were kind of getting the clusterization, right, and pricing, right?
But to be able to get this right, I had to eliminate some items and send in other items, which took a while because you have to operate with the entire cycle. Since we're having some capital discipline, I wasn't going to buy another product before I finished with the older products. So as we get the clusterization right in each region, this has brought in major growth in our sales, especially when it comes to physical stores or brick-and-mortar stores where the availability of products really brings in the sufficiency considering the strength of our brand. When we look at e-commerce, we still can't take on a GMV growth commitment, right? So we consider this commitment in the margins, but we see, and we do have a plan considering the opportunities for growth in GMV and e-commerce.
So for certain categories, we also reduced the assortment where the contribution margin was negative. And as we improve the efficiency, the conversion rates went up. With the same processes, we can optimize this from minus one to plus two, and that also allows me to buy more of this product and keep this positive contribution margin. But it's a test every day. We're really measuring hour by hour what's the investment, how much you brought in, what's the contribution margin. So we don't sell in a way that improves in one quarter, but structurally destroys the business. We want something that's sustainable, and if necessary, we'll give up on a bit of growth. But when we look at the strength of the brand and our share, we do imagine the possibility of this growth in e-commerce. In 3P, it's actually connected to the second question.
There is two main levers for the growth of 3P. One is we had to give a bit of focus, so we stopped negotiating and providing our space to certain items because we wanted to sell items in 1P. We didn't want to have competition there. But now we've got back to structure this, and especially for the core and SKUs. And then retail media is the way to invest and provide more visibility to these products. So most of retail media is for performance, and that's really related to 3P and 1P online sales. So this helps bring profitability and growth in 3P and in 1P online. Retail media for physical stores is starting, but it's still a small part. We want to do more in 2025 than we've done in 2024. And that's where in physical stores or brick-and-mortars, there's a lot of partners.
When we look at digital, we have hundreds of small players that sell in our marketplace, and we have the big suppliers and industry growing exponentially. With each one coming in, the ticket is greater, and that helps us. We've started to work on our joint business plan, and this has been already hired, but we have to have this execution challenge to be selling this every month and week, and they're going to help grow. Investments are already made, and it's already in our DNA. We have teams structured, and we don't have to increase the structure, but now we want to dilute this by delivering the business plan so that each area built can deliver this. If everyone delivers, then this will lead to growth of 1P, 2P, and 3P in physical stores, and we can even deliver more than what's in our business plan.
Because obviously, we've planned with some deviations in regards to the targets we had to be able to deliver this plan that can make the company be in a sustainable position and really discuss this expansion cycle. That's pretty much it within what I can discuss without giving any future guidance. I just want to reinforce the topic you mentioned on share gains and investments in marketing. I think our topic generally is efficiency and how we can, with the same amount we've invested this year, looking at the analytics and challenging the marketing teams, how we can have better productivity and efficiency for each Real we spend and which channel where we're going to place that. That's a significant granularity, right?
And then considering our focus in brick-and-mortar stores and digital, we also have a CRM system where we really focus on this and that's the leads we have through the cell phones of the salespeople. And we create this relationship that's really personal. It's not like an email we receive or spam, but this personal relationship with the sales team and customers. And you can see that this last installment of the Buy Now, Pay Later is expiring and maturing in a month from now. Don't you want to buy a new television or exchange a cell phone? And you bring this consumer in-house and you start performing this conversion. So there are many initiatives in this aspect, gaining share and advancing the revenue with more productivity.
And then we have many different levers we set here in the second phase to be able to advance more and more without having to have such a big spend that would maybe not be profitable.
Okay, perfect. Very clear. Thank you so much, guys.
Thank you, Alexandre. Well, now our next question is from Iago. Iago, you may proceed.
Hey, good morning, Renato, Elcio, and Gabriel. Thanks for the space, and I have three questions. The first one is about credit. So what you guys can tell us in regards to the provisions policy that you guys have. First of all, how much do you guys provision? And if something changed in regards to what it was before the restructuring, then the second question is about banQi. So I imagine that it's a part that's not explored that much.
Besides the main objective, which is paying the digital Buy Now, Pay Later, what would be the proposal for banQi, right? What else are you going to discuss to bring in value to this asset? Then the third and last question is about the scale of a 6x 1. You don't want to discuss the actual impact of this measure, but we've been questioning. We've received a lot of questions about this from investors. You guys have 33,000 employees. So can you guys give us some information of what would be the possible impact and how many of these employees work in this six days and rest one day regime that's being discussed in Parliament in Brazil?
Our provision is a methodology that's really conservative, even the Buy Now, Pay Later. That's an important point for everyone. When I grow in the Buy Now, Pay Later, then I give the impact that month because the provision is made based on that indicator that has a deviation that I have to recover later on. So maybe I consider this provision and then I recover this. So then when I reach the six months, we move this all to losses. So it's quite conservative in regards to the market.
So the Buy Now, Pay Later brings this negative impact in the bottom line. And then 14 months on average of the positive impact, which gives us major profitability. It's over 40%. So given the growth of the Buy Now, Pay Later, that helps us with this conservative provision model to guarantee our commitment, that is, to deliver our consistent evolution in the margin every quarter.
Because when I grow, I'm provisioning a bit of this in this quarter, and I'm also generating gains for the next quarter. So keeping up with this growth cycle helps us deliver our plans and conquer credibility in the market. When we talk about banQi, there's major potential. So we've been discussing this as the company has been gaining profitability, and there's a lot of people that want to explore this, right, Channel, either through personal loans, and we want to also set up an FIDC financial instrument. There's an interesting tier. There's health plans, many different proposals being discussed by our team. And there's also an alternative to implement bigger partnerships that we are planning to study as long as we can keep control over the Buy Now, Pay Later and do other things. So in the long term, this should be consolidated and structured.
Remember, this is a huge asset with monetization potential that could eliminate the debt or financial leverage of the company, but we are not interested in this in the short term. So yes, we do want to have investors and partners to explore all of this and maximize returns to the company and bring in more sales of services to the company in channels that are underdeveloped. But then there's some levers that are also a little more strategic as well. And that could maybe even bring in a reduction in the funding costs, but it's kind of early to start talking about this. But yes, it's in the umbrella of financial services. There's a banQi strategic plan, some discussions underway. These are all upsides.
We didn't price these yet, but they could bring in contributions that are transformational, especially when you consider the scalability of the company and potential for growth as well. So it's a real complex topic on the 6x1 discussion for labor laws. And people try to price things. At the end of the day, it's never what people think of. And so you make a huge effort to just discuss hypotheses. So we must wait on this, and at the right moment, we'll position ourselves. But I think the sales force, the variables are, the expenses are variable. You can manage them. And then depending on what it's like, you have to adjust structure. And when it's something for everyone, in the worst-case scenario, you have some pricing impacts. And that's life, right? So it's not something that we can control.
I think what our commitment is here is to improve the operational efficiency, adjust the capital structure, and have a sustainable and efficient company regardless of the macro scenario changes. We know how to operate in these changes, and we know how to profitize the company according to the scenarios we have.
Perfect, guys. Thanks for the answer.
Thank you, Iago. All right, our next question is from Nicolas at JP Morgan. Nicolas, you may proceed.
Hi, guys. Good afternoon. Thanks for taking my question. Still about the Buy Now, Pay Later. Renato, you talked about this in your initial conversation where you had maybe started a little slowly in the beginning of the year, but then that was reaccelerated in the second semester. I wanted to understand what the growth is like for the Buy Now, Pay Later. And it's interesting to see the penetration in 1P. I wanted to understand how you imagine this in the digital channel and also in the store. If you also imagine you guys would be low 30s, let's say.
Thanks, Nick, for the question. The Buy Now, Pay Later is important, and we've always had demand. It's just that we didn't have the funding to be able to grow this. As we deliver the, we started having funding. With this, with the conversations we've had with investors and banks, we do see support to keep this current growth pace. The demand we have could help us grow even a bit more. Growing like BRL 100 million per month is something we can achieve. If you look at this, we're reaching over BRL 800 million per month, eliminating the seasonality.
Maybe it could be a little bit bigger, so maybe BRL 100 million more per month, and we can grow gradually. Greater gains would be more risky. Once again, we're not here to take risks. We're here to increase gradually our profitability, our performance, and the growth in our sales. It's going to be a little softer and easier than our BRL 100 million per month. We're going to grow a bit less than the potential we believe in to keep this conservative approach in our credit availability, etc. That's what we're seeing for 2025. For digital, we have a spread in health and profitability that's similar with the physical stores. It's counterintuitive. Our expectation is that eventually it could be a little worse with delinquency, and then with that, maybe a little less profitable.
But the guys have been working on exceptional work, and they've been able to deliver the same profitability. But within this, we think that we could reach levels that are a lot higher than 30%. But in the short term, we won't have any sudden changes or shifts, and this increase will also be gradual. So we see the stores moving towards this, but it's going to take a little while for us to reach the 30. And time here is like more than a year. We're not going to finish 25% or 30% because we're going to do this gradually. And the store is growing. If the store was not growing, then they would go over the 30 easily. But since we understand that the physical stores will grow, then that also increases penetration compared to what we've seen here in 2024.
In digital, we also see that going beyond the 10%. We have seasonality. We have the consumer week in March, Black Friday. I'm not going to be disputing penetration, right? We want to do whatever we can do with profitability. We think that the high single digits or the low double digits are really good penetration between 9% and 10%, 11% penetration. That seems to be really healthy. We already have significant contributions, and that's the scenario that's most probable for 2025. In the long term, we do plan to increase both penetrations. I think that grows a lot is also leading to important contribution, which is the credit cards. Credit cards, we issued 50,000 per month. We went on to 100,000, 150,000, then maybe 200,000. For credit cards, they're really becoming like a big important business, right?
We have revenue of a ticket, and you receive a fee on the commissions, and you also increase the loyalty. So we want to increase penetration to bring in a big percentage of my revenue, which increases profitability, recurrence, my control. The CRM stocks as well provide important returns. And so they're paying the last installment. We already invite them to come to the store and try to buy another product. So that's where they already place this. And that provides more stability in our revenue, recurrence, loyalty, and that's really important for sustainable retail. I'm sorry if I went over time a bit here. Well, I just wanted to mention that in the short term, we'll have this movement with a lot of focus on this.
But in the mid to long term, it's an important lever, right, to see when we see the other regional players that you know really well, they have double the penetration. So of course, we're going to be building this over time with a lot of discipline. But the potential for growth in this portfolio, considering our brand and presence, is really big.
Okay, perfect. Thank you guys. Very clear.
Thank you. Thank you, Nicolas. Our next question is from Dani Eiger from XP Investimentos. Dani, you may proceed.
Hi guys. Thanks for taking my question. First, it's more of a top-down dynamic. We're seeing deterioration in the macro scenario, also the interests at higher levels. And so that also impacts the strategy more towards 2025. Is there something that you guys think we'll rely more on? We'll be more cautious about this. I wanted to understand your mindset. And so the levels are probably very healthy. And I wanted to understand if it makes sense to not expect more expansions from now on, and then the EBITDA expansion coming more from my operational leverage, but also maybe investing in competitive advantages considering the macro scenario to be able to sustain growth. So I think these are the two points on my side.
Great. So interesting, Dani. Both are related. So that increases the cost of capital and also the variable funding costs, right? So a lot of what we sell, we sell in installments free of interest. And so our pricing also considers the contribution margins for each of the products. So to be able to deliver the same contribution margins of that product with a higher interest, then you need to have a higher gross margin. And this gross margin could come from pricing.
It could come from the optimization of stocks. It could come from adding on services or the Buy Now, Pay Later. So these four levers really influence a lot when I look at the direction for 2025. Considering the macro scenario, we need to increase the gross margin or reduce our stock or do something else like that. What's the problem in the market dynamic, right? I see the gross margin per product, right, in each of the sales channels. The market sees us consolidate business. Of course, the gross margin for e-commerce is a lot smaller than individual physical stores. So if e-commerce responds more for this, that'll push the margins upwards. But then I won't have a problem with delivering the gross margins downwards, right? It's always a discussion with the concern of how the market's going to understand that the market really weighs in on this.
We can see this gradual improvement. So yes, I do see this improvement because this is offset with furniture that's growing a lot, and they bring in gross margin. But it's more of like a mix effect and the penetration effect of these services than the actual pricing. And everyone connects this gross margin to the pricing. And so once again, I said this back there. And when you explain this, you see everyone gets back to the gross margin and EBITDA because it's difficult, right? You'd have to provide a lot of granularity, open up and disclose the strategy so everyone can have the same comfort we have to increase the profits after income tax. So for gross margins, this is the level with gradual growth, very much influenced by the mix and channels, the merchandise. And so their gross margins are smaller.
And before that, why are we selling less before, right? Well, especially for physical stores, for example, because sometimes to have a better gross margin, you could sell the side that has profit. So I can't have something that keeps me from delivering this profit, right? So the gross margin is a medium indicator, an output that's maybe not the best. It's like a guide, but it's not one of the best guides. So I think we should continue to gain SG&A efficiency. As you mentioned, the operational leverage provides important contributions to the EBITDA, and that's really important. Sorry, we had a technical issue here with the sound. Okay, thank you for the question.
Thank you, Dani. Renato, we don't have any other questions, so we will pass it on to you for your final remarks.
Thank you, Gabriel. Final remarks, I think that would be the last slide. From the short-term vision, how do we see the company? We see the feedback and all the reports. We received this in the morning, and yesterday, everyone's kind of recognizing this operational efficiency and the important steps taken when it comes to reprofiling the debt with the expenses of financial expenses and interest rates that were really constituted in 2029, 2030. The grace period is still 2026. We gained a lot of time. Why is that? So we can have, and so I think the macro scenario is still challenging. We're going to see players that are kind of scaring the market a bit. We've done our homework, and the macro scenario should start getting a little better by the end of 2025.
We'll also have some important levers in our capital structure by the end of 2025. So we even have the possibility to convert the debt into equity, and that'll help with the transformation process. And we have important improvements as well to deliver this. So we understand that we're going to finish 2025 with a very different scenario to be able to reach this expansion cycle with a better capital structure. So I want to thank you for your support. It was fundamental. Today, we're more confident than where we were with the plan moving along well, the capacity for execution, the team's well set up, and we're really happy here with the team we've had to lead the business. So once again, we have a little more control now, more and more and more knowledge.
And so you'll see some opportunities that makes everyone more comfortable with the company as well. And so, and so the company is investing and the prespective is to have a bit of inflation. And so you have this before the increase. So, switching the air fryer, blender, et cetera. So, thank you all, and have a great afternoon. And our team is still available. Thank you all.