Telefonica Brasil (NYSE:VIV) executives highlighted what they called a “remarkable” 2025, citing revenue growth above inflation across key lines, rising profitability, and shareholder distributions that exceeded annual net income, during the company’s fourth-quarter and full-year 2025 earnings call.
2025 operating highlights: postpaid, fiber and 5G adoption
CEO Christian Gebara said mobile performance was led by postpaid, with accesses up 6.5% year-over-year to 70.8 million customers, representing 69% of the mobile base. Total mobile accesses ended 2025 at 103 million, up 0.7% year-over-year. Postpaid (including M2M and dongles) expanded 6.9% and surpassed 50 million customers for the first time, he said.
In fiber, Vivo closed 2025 with 7.8 million FTTH connections and a footprint of 31 million homes passed, after adding 1.9 million homes over the year. Take-up improved to 25.2%, while FTTH accesses grew 12% year-over-year. The company emphasized momentum in its convergence strategy: Vivo Total subscribers rose 41% year-over-year, and management said 62.7% of the FTTH base is converted to postpaid, with 43% through Vivo Total. Fiber churn declined to 1.4%, which management said was the lowest level in its history.
Revenue mix: handset rebound and “new businesses” growth
Gebara said fourth-quarter total revenue rose 7.1% year-over-year to BRL 15.6 billion, supported by both mobile and fixed services. Mobile service revenue increased 7%, while fixed services rose 5.4%, reflecting contributions from fiber and corporate solutions.
He added that postpaid and FTTH revenue grew 9% and 9.8%, respectively, in the quarter. The company also reported its strongest growth in handset and electronics revenue in three years, up nearly 14% year-over-year, which management attributed to a broader portfolio, seasonal offers, and strong consumer demand for electronics.
Management highlighted continued expansion in “new businesses,” with revenue up 27% over the last 12 months and representing 12.1% of total revenues, up 1.9 percentage points year-over-year. In B2C, new businesses grew 20.7% and accounted for 3.3% of total revenues, while total B2C revenues reached BRL 44.8 billion, up 5% year-over-year. The company said revenue per RGU increased to BRL 65.8.
Within B2C new businesses, Vivo cited growth of 18.1% in video and music OTTs, 36% in consumer electronics, and close to 70% in health and wellness. The company also said it approved an additional BRL 150 million for Vivo Ventures investments, focused on AI-driven initiatives, bringing total investment capacity to BRL 470 million. Gebara noted a partnership offering customers a complimentary 1-year subscription to Perplexity Pro.
B2B expansion led by digital services
In B2B, management reported 2025 revenue of BRL 13.5 billion, up 13.7% year-over-year. Digital B2B grew 29.5% and represented 8.8% of Vivo’s total revenues, while connectivity rose 5.4%.
Executives detailed year-over-year growth by digital B2B category:
- Cloud: +37.8%
- IoT and messaging: +25.9%
- Digital solutions: +22%
- Cybersecurity: +8.4%
Management said B2B increased its share of the revenue mix by 140 basis points year-over-year and characterized 2025 as the segment’s fastest annual expansion in recent years. In response to analyst questions, the company said penetration is improving across segments, with SMEs described as more challenging for digital services, though connectivity growth remains strong.
Profitability, cash generation, and capital returns
CFO David Melcon said fourth-quarter total cost was BRL 8.9 billion. Excluding concession migration effects, OpEx was essentially flat, up 0.4% year-over-year. Cost of services and goods sold increased 9.7%, which he said reflected higher contributions from B2B digital solutions, demand for OTT offerings, and a greater share of handsets and electronics. Operating costs grew 4.4%, led by a 6.4% increase in personnel expenses due to salary adjustments and higher headcount in strategic areas such as digital tech, while commercial and infrastructure costs declined 2.6% due to one-time items in the prior-year quarter.
Reported EBITDA rose 8.1% year-over-year in the fourth quarter. Excluding items related to concession migration in both periods, Melcon said EBITDA increased 17.7% year-over-year, with a 380-basis-point margin expansion to 42.3% (while reported EBITDA margin was 42.9%).
CapEx totaled BRL 9.3 billion in 2025, up 1.1% year-over-year, and CapEx-to-revenue declined to 15.6%. Operating cash flow before leases increased 13.4% to BRL 15.6 billion; after leases, operating cash flow rose 17.3% to BRL 10.1 billion, with a 17% margin. Melcon said the company remains focused on optimizing tower-related expenses and improving contract efficiency.
On profitability, the CFO said net income for 2025 reached BRL 6.2 billion, up 11.2% year-over-year. He also reported a net cash flow position of BRL 2.3 billion at year-end, compared with BRL 1.4 billion in 2024. Including IFRS 16, net debt was BRL 13.1 billion, or 0.5 times EBITDA. Free cash flow rose 11.4% to BRL 9.2 billion, with a free cash flow yield of 8.6% and free cash flow over revenues of 15.4%.
Management said shareholder distributions in 2025 totaled BRL 6.4 billion, a payout ratio of 103.4% of net income, aligning with its commitment to distribute at least 100% of annual net income. For 2026, the company announced BRL 7 billion of planned distributions, including BRL 4 billion from capital reduction to be paid in July and BRL 3 billion in interest on capital declared in 2025 to be paid in April, plus additional interest on capital declared in February to be paid before April 2027. The board also approved a new share buyback program of up to BRL 1 billion through February 2027.
Outlook themes: pricing actions, capex discipline, and consolidation talk
While the company said it is not providing CapEx guidance, executives reiterated a focus on improving CapEx intensity. On pricing, management discussed planned increases by segment, including price actions for postpaid and hybrid customers, fiber price increases (including one in January and another planned for June), and a planned April price increase for Vivo Total across the customer base, described as following inflation while adding data and services.
On fiber industry structure, Gebara described the market as fragmented and said Vivo’s fiber market share rose from 18.8% at the end of 2024 to 19.3% at the end of 2025. He said there is “room for consolidation,” though any potential M&A would depend on network quality, customer base, overlap with Vivo’s footprint, and price. He also said the company remains open to analyzing targets but has not reached agreements.
Executives also discussed the potential financial benefits from reduced depreciation and amortization beginning in the second quarter, and noted that after July 2026 certain legacy assets will be fully depreciated, which management said could improve profit before taxes by BRL 300 million, alongside potential benefits from lower interest rates if Brazil’s Selic declines.
About Telefonica Brasil (NYSE:VIV)
Telefônica Brasil SA, commonly marketed under the Vivo brand, is one of Brazil’s largest telecommunications providers, offering a broad range of consumer and enterprise communications services. The company’s core activities include mobile voice and data services, fixed-line telephony, broadband internet (including fiber-to-the-home), and pay-TV solutions. It also provides ICT and managed services for business customers, such as cloud, data center, connectivity, Internet of Things (IoT) and security solutions.
Vivo operates a nationwide network across Brazil and serves both individual consumers and corporate clients.
