Telefonica Brasil Reports Q2 2026 Results: Full Earnings Call Transcript

Telefonica Brasil (NYSE: VIV ) released second-quarter financial results and hosted an earnings call on Tuesday. Read the complete transcript below. This transcript is brought to you APIs. For real-time access to our entire catalog, please visit for a consultation.

6% and fixed revenues growing 6% driven by fiber and B2B operations. 8 billion reais. 5% increase compared to the previous year. 2 million homes.

6% increase in new business revenues. 6 billion reais, focusing on infrastructure enhancements. Management highlighted ongoing strategic initiatives, including the migration from concession to authorization, and emphasized their commitment to shareholder remuneration and sustainable growth. ESG initiatives were spotlighted, with achievements in environmental education, recycling programs, and recognition for governance practices.

Full Transcript OPERATOR Good morning, ladies and gentlemen. Welcome to Vivo's second quarter 2026 earnings call. br. The presentation will also be available for download.

This call is also available in Portuguese. To access, you can press the globe icon on the lower right side of your Zoom screen and then choose to enter the Portuguese Room. After that, select Mute Original Audio. We would like to inform that all attendees will only be listening to the conference during the presentation and then we will start the questions and answers section, when further instructions will be provided.

Before proceeding, we would like to clarify that any statements that may be made during this conference call regarding the Company's business prospects, operational and financial projections and goals are the beliefs and assumptions of Vivo's Executive Board and on the current information available to the company. These statements may involve risks and uncertainties as they relate to future events and therefore depend on circumstances that may or may not occur.

Investors should be aware of events related to the macroeconomic scenario, the industry, and other factors that could cause results to differ materially from those expressed in the respective forward-looking statements. Present at this conference we have Mr. Christian Gebara, CEO of the company; Mr. Rodrigo Monari, CFO and Investor Relations Officer; and Mr.

Joan Pedro Soares Carneiro, IR Director. Now I will turn the conference over to Mr. Joan Pedro Soares Carneiro, Investor Relations Director of Vivo. Mr.

Carneiro, you may begin your conference. Joan Pedro Soares Carneiro, Investor Relations Director Good morning, everyone, and welcome to Vivo's second quarter 2026 earnings call. Today our CEO, Christian Gebara, will present Vivo's ongoing execution in connectivity and new businesses, as well as share our key ESG highlights for the quarter. Then, Rodrigo Monari, our CFO, will give you more color on cost evolution, cash generation, profitability, and shareholder distribution.

Going forward with that, let me turn the call over to Christian. Christian Gebara, CEO Thank you, Zhuang. Good morning, everyone, and thank you for joining us today. Building on the positive performance from the beginning of the year, Vivo delivered another quarter of solid execution combining healthy operational and financial trends.

These numbers demonstrate the strength of our business model, the quality of our customer base, and the consistency of our strategy within a dynamic environment. Customer engagement remains at the center of our growth story. 9% year over year. 3% year over year, while our footprint expanded to 32 million homes passed.

These accomplishments reflect our sustained commercial momentum, supported by the attractiveness of our value proposition and customer recognition of the quality and differentiation we deliver. 6% year over year. 6%, while fixed revenues grew 6%, highlighting the improvement of fiber and the positive contribution of our B2B operations. Profitability continues to outpace revenue growth.

8%. 8 billion reais. 9 billion reais, underscoring the strength of our cash generation capabilities. Our operational excellence and financial discipline support attractive shareholder returns.

5% versus the same period last year, and remain fully committed to our shareholder remuneration guidance for this year. On slide 4, the benefits of our diversified ecosystem are becoming clearly evident, supporting growth across connectivity, digital services, and the sale of handsets and electronics. 6% year over year in the quarter, reflecting balanced contributions across our top line. 7%.

8% year over year, marking its highest annual evolution in five years. This performance reflects the success of our commercial initiatives and the growing relevance of Vivo as a destination for customer technology products. As our ecosystem expands, the quality and predictability of revenues keep improving. 8% of service revenues, extending a positive trend that has consistently strengthened over recent quarters.

This evolution further reinforces the resilience of our business model and the sustainability of our trajectory. Turning to slide 5, our mobile operation stands out through its ability to combine customer growth, monetization, and retention. 1%, reinforcing our leadership across multiple mobile segments. 1% year over year.

This performance confirms Vivo's competitiveness and the attractiveness of our offers. At the same time, we remain focused on successfully executing our more-for-more strategy. 5 reais, with postpaid churn at stable levels of only 1%. Notably, even after recent price adjustments, customer loyalty remained unchanged, reflecting our superior network and service excellence.

The evolution of 5G is an important part of the story. Today, nearly one-third of our mobile base, excluding machine-to-machine and dongles, uses 5G every day. As usage continues to ramp up, we are further enhancing customer experience while creating new opportunities to deepen engagement and support future revenue expansion. Overall, these results underscore the resilience and monetization potential of our mobile platform.

The combination of postpaid expansion, record ARPU, resilient churn levels, and growing 5G adoption demonstrates how Vivo is creating a solid foundation for ongoing profitable growth. On slide 6, we illustrate how scale, quality, and convergence underscore Vivo's ability to raise the bar in the fiber market. 2% year over year. Once again, convergence was the key driver of this performance.

4% compared to last year and further increasing its relevance within our fiber base. This reinforces a trend that we have seen for several quarters: customers increasingly demand integrated solutions that unite connectivity, convenience, and superior experience. Beyond growth, our customer base profile remains a clear differentiator. 4%, reaching historically low levels and reflecting the depth of our customer relationships as well as the trust in the services we deliver.

This high level of loyalty supports the long-term sustainability of our fiber business and contributes to stronger lifetime value generation. Commercial momentum also remained healthy throughout the period. FTTH net additions reached 213,000 accesses, 6% higher than a year ago. At the same time, we have continued to expand our footprint with both speed and discipline.

6%. This pattern of network expansion and rising penetration confirms that we are successfully converting infrastructure investments into profitable customer growth. Moving to slide 7, we continue to see the benefits of our strategy to expand beyond connectivity and build a distinguished ecosystem capable of serving a broader range of customer needs. This approach is translating into consistent growth and stronger monetization.

8% year over year. 6% versus last year. The sustainability of this growth is reflected in customer monetization. 5 reais per month, continuing the upward trend observed over the past several quarters.

As customers adopt more products and services within the Vivo platform, we strengthen engagement and deepen the relationship with our more than 56 million clients. New business endures as one of the most dynamic components of our portfolio. 8%. 4% of total revenues.

Innovation also remains an important differentiator. During the quarter we reinforced Vivo's position as a leading digital hub by introducing exclusive benefits related to Gemini AI and Google Cloud Storage for eligible customers. In addition, we expanded the attractiveness of our offers through partnerships such as YouTube Premium, providing customers with a richer digital experience and further increasing the relevance of our plans. Through tailored offerings, digital innovation, and a growing portfolio of services, we strengthen customer lifetime value and create new avenues for future expansion.

Turning to slide 8, our B2B business continues to demonstrate the strength of Vivo's strategy to evolve from a connectivity provider into a trusted technology partner for enterprises across multiple industries. 2% year over year. 8%. 2%, cybersecurity advanced 10%, and IoT and messaging grew 1% year over year.

What stands out is not only the performance itself but also the breadth of our capabilities. Today, enterprises seek partners capable of delivering tailored end-to-end solutions rather than isolated products. This trend continues to expand Vivo's opportunities across both private and public sectors. 4 million people.

Beyond enhancing connectivity, projects like this highlight Vivo's ability to develop customized initiatives that create value for customers and society. On slide 9, we highlight the continued advancement of our ESG agenda through initiatives that generate measurable impact and recognition from leading institutions. On the environmental front, we continue to expand programs that combine education, awareness, and circular economy principles.

Through the third edition of Vivo Recycling, aligned with Vivo's Volunteer Day, we promoted environmental education and electronic waste collection across 33 schools, benefiting approximately 32,000 students, teachers, and community members. As a result, the volume of materials collected increased 28% year over year, demonstrating growing engagement with responsible consumption and recycling practices. We also achieved important milestones in waste management and environmental stewardship through our certified recycling seal. One hundred percent of our packaging is now recyclable across all Brazilian states, exceeding our regional target by 66 percentage points.

In parallel, the Floresta Futuro Vivo progressed with the planting of its first seedlings and the engagement of local communities, reinforcing our commitment to biodiversity preservation. From a governance perspective, Vivo was awarded the Pro-Ética seal and achieved the maximum score in FTSE Russell's ESG assessment. These achievements were complemented by several recognitions, including being named the best ESG company in the sector by Izumi for the third consecutive year and ranking first in Top Companies in São Paulo. We also surpassed our 2025 gender and racial diversity targets under the UN Global Compact, Brazil's Ambition 2030 initiative.

With that, I would like to hand over to Rodrigo, who will walk you through our financial results. Rodrigo Monari (Chief Financial Officer) Thank you, thank you Christian, and good morning everyone. Turning to slide 10, our results continue to demonstrate the scalability of our business model, as disciplined cost management and evolving business mix translated into double-digit EBITDA expansion and further margin improvement. 3% year over year.

2% as a result of the performance in handset sales, digital solutions and new business revenues. These costs remain closely linked to commercial activity and ongoing diversification of our revenue mix. 2%. 7% year over year, supported by business growth and ongoing investments in customer experience and network quality.

2% year over year, highlighting our efforts to drive productivity and efficiency across the organization. Bad debt showed behavior consistent with our disciplined credit practices and the resilient quality of our customer base, remaining flat year over year in nominal terms and reducing as a percentage of gross revenue. We are also on track in our migration from concession to authorization plan, generating 202 million reais in proceeds from corporate sales in the quarter. Going forward, we expect to further advance in the value capture through these initiatives.

8%. This illustrates our ability to capture growth while preserving cost discipline and operational productivity. On slide 11, we stay focused on investing for future growth while sustaining efficiency and financial discipline. As we capture opportunities across mobile, fiber and digital services, we are steadily enhancing the infrastructure and capabilities that underpin our long-term competitiveness.

4% of revenues, slightly below the previous year. These investments were mainly focused on supporting growing fiber and expansion of 5G coverage, now present in 978 cities. This represents an increase of 325 cities compared to the same period last year, reaching more than 73% of the Brazilian population. As a result of our investment strategy, we are enhancing our returns and cash generation profile.

3% year over year and exceeding the pace of Capex expansion. This reflects our ability to combine network expansion with operational excellence, translating top-line growth and higher profitability into stronger cash flow. Moving to the next slide, we present the progress in profitability, cash flow and balance sheet management. 9%, delivering the strongest first half year-over-year evolution in three years.

These results reflect the consistent execution discussed throughout the presentation, supported by revenue growth above inflation, margin expansion and a greater contribution from more valuable revenue streams across our portfolio. Free cash flow has followed a positive trajectory since third quarter 25, reflecting our consistent ability to convert operating performance into cash. While quarterly results can be affected by temporal effects that distort year-over-year comparability, the underlying trend remains sound.