Press star one one again. Please be advised that today's conference is being recorded. I'll now like to hand the conference over to dLocal. Please go ahead.
Good afternoon, everyone, and thank you for joining the First Quarter 2025 Earnings Call today. If you have not seen the earnings release, a copy is posted in the financials section of the investor relations website. On the call today, you have Pedro Arnt, Chief Executive Officer; Jeffrey Brown, Interim Chief Financial Officer; and Mirele Aragao, Head of Investor Relations. A slide presentation has been provided to accompany the prepared remarks. This event is being broadcast live via webcast, and both the webcast and presentation may be accessed through dLocal's website at investor.dlocal.com. The recording will be available shortly after the event is concluded. Before proceeding, let me mention that any forward-looking statements included in the presentation or mentioned in this conference call are based on currently available information and dLocal's current assumptions, expectations, and projections about future events.
While the company believes that our assumptions, expectations, and projections are reasonable given currently available information, you are cautioned not to place undue reliance on those forward-looking statements. Actual results may differ materially from those included in dLocal's presentation or discussed in this conference call for a variety of reasons, including those described in the forward-looking statements and risk factors sections of dLocal's filings with the Securities and Exchange Commission, which are available on dLocal's investor relations website. Now, I will turn the conference over to dLocal. Thank you.
Thanks, everyone, for joining us today. Despite a more volatile global macroeconomic backdrop in 2025, the year has started broadly in line with our expectations. Building on the momentum of previous quarters, dLocal continues to demonstrate strong execution and to prove the resilience of our business model, once again achieving record highs across key financial and operational metrics, despite Q1 not benefiting from seasonal strength in e-commerce. We believe that consistent sequential growth is a confirmation of our company's ability to compound growth over extended periods of time, consequently delivering shareholder returns. Net retention rate of TPV reached an impressive 144%. This figure demonstrates the defensibility of our business with our merchant base. Additionally, we're encouraged by TPV that grew north of 50% for a second consecutive quarter, underscoring the success of our strategy and the increasing demand for our services.
These results reflect our continued commitment to innovation, customer satisfaction, and expanding our footprint throughout emerging markets. Furthermore, we continue to carry out strategic investments in technology and operations that are directly fueling the strong results of the quarter and building a robust foundation for sustained financial performance by strengthening our infrastructure, optimizing efficiency, expanding our service offerings, and elevating the quality of our service. Key accomplishments highlighted during the quarter include our TPV that reached the milestone of $8 billion, reflecting a 53% year-over-year growth or 72% in constant currency, and a 5% quarter-over-quarter increase in this volume. This performance has been driven by sustained expansion in cross-border payment volumes supported by Chile, Pakistan, Nigeria, Turkey, and Brazil, as well as robust growth across multiple verticals, with nodal contributions from sectors such as remittances, commerce, financial services, and streaming.
Revenue and gross profit hit record highs of $217 million and $85 million, respectively. As in previous quarters, we continue to see the strength of continued geographic diversification, with notable contribution from other LATAM markets during this quarter. While we do continue to invest in OpEx to support and accelerate our future growth trajectory, we are still driving operational efficiencies across the organization. The adjusted EBITDA to gross profit ratio for the quarter reached 68%, a slight improvement even when compared to the previous quarter, reflecting our ability to scale effectively. Despite ongoing investments, we've also continued to improve our revenue per head count over the last four quarters. Finally, we've generated strong cash flow, with free cash flow to net income conversion at 85%, reinforcing our commitment to a high-growth, expanding margin, and cash-generating financial model.
Now, moving on to our commercial update, I'd like to share some of the highlights from the quarter. You'll find additional detail in the accompanying slides. These results highlight our ability to maintain and strengthen these relationships over time, ultimately increasing our share of wallet with merchants. We continue to strengthen our partnership with Temu, enabling their customers to transact seamlessly across over 15 emerging markets in Africa, Asia, and Latin America. Our partnership with Zepz is ramping up across key markets, demonstrating strong growth in Latin America as well as in several African and Asian countries. We remain committed to supporting the merchants' global expansion efforts, launching operations in further markets in Africa, which further strengthen their global footprint. Another noteworthy partnership has been Rappi, which has been achieving significant growth in both Colombia and Argentina after a latest round of new feature deployments on their behalf.
On the technology front, our advancements were centered on leveraging automation and AI to drive operational efficiency and optimize performance across key areas. On the artificial intelligence front, the implementation of AI improved efficiency in customer experience and compliance monitoring by automating tasks and decisions previously handled manually. On the process automation front, automations have enhanced handling of chargebacks and refunds, substantially augmenting merchant win rate on chargebacks and accelerating refund flows. On integration efficiencies, a redesigned integration system has accelerated the setup process for new integrations, cutting down the time required to fully integrate with dLocal from days to just a few hours. We've also made interesting advances in our MCP server and LLM-friendly API documentation for integration to dLocal, aiming for a near future where simple prompts will allow our merchants' engineers to complete end-to-end integration with our systems through AI agents.
On the merchant settlement front, the implementation of an improved settlement system streamlined operations and greatly reduced the need for manual intervention in merchant settlements. These automation initiatives are beginning to deliver results. More importantly, this is not a side project. It's a core strategic imperative that will shape our future. Over the midterm, these results should deliver operational leverage and enhanced capabilities as we progressively integrate these technologies across the entire organization over the coming years. We anticipate these efforts will lead to a noticeable slowdown in midterm hiring growth, improved operational leverage, and ultimately a more robust and scalable business. Another key area of investment focuses on continuously optimizing performance to maximize conversion rates and TPV while delivering trusted and agile services to our merchants. During the first quarter, we enhanced our smart request strategies further.