Telefonica Brasil (NYSE:VIV) Announces Quarterly Earnings Results, Misses Expectations By $0.02 EPS

Key Points

• Telefonica Brasil missed EPS expectations in its quarterly report, posting $0.15 per share versus the $0.17 consensus, while revenue came in line at $2.98 billion.
• Operational performance was solid, with management highlighting 7.4% revenue growth, 8.9% EBITDA growth, and strong gains in postpaid customers, fiber connections, and ARPU.
• The company emphasized shareholder returns and balance-sheet strength, reaffirming at least BRL 7 billion of distributions for 2026, announcing a BRL 1 billion buyback, and reporting net debt/EBITDA of about 0.4x.

Telefonica Brasil (NYSE:VIV - Get Free Report) announced its quarterly earnings data on Monday. The Wireless communications provider reported $0.15 earnings per share (EPS) for the quarter, missing the consensus estimate of $0.17 by ($0.02), FiscalAI reports. The business had revenue of $2.98 billion during the quarter, compared to analysts' expectations of $2.98 billion. Telefonica Brasil had a return on equity of 9.15% and a net margin of 10.42%.

Here are the key takeaways from Telefonica Brasil's conference call:

• Strong financial performance: Total revenue rose 7.4% YoY, EBITDA grew 8.9% with a 40.2% margin, net income was up 19.2% to BRL 1.3bn, operating cash flow was BRL 4.2bn and free cash flow BRL 2.2bn.
• Customer and ARPU momentum: Postpaid accesses grew 6.9% to 72.1m (69.5% of mobile base), total mobile 103.7m, fiber connections reached 8.0m (homes passed 31.5m), with mobile ARPU at a record +5.7% and postpaid churn at 1.0%.
• Revenue mix shifting to higher‑value services: New business now represents 12.1% of revenues, B2B revenues rose 11.8% (digital B2B +23.8%), while consumer electronics and health offerings posted double‑digit growth, supporting diversification and higher monetization per customer.
• Capital allocation and balance sheet strength: Management reaffirmed at least BRL 7bn of distributions for 2026, launched a BRL 1bn buyback, and reported a stronger net cash position with net debt/EBITDA ~0.4x.
• Cost and execution risks: Cost of goods and services rose 12% (handset/electronics and new businesses), bad debt was ~2% (impacted by one B2B customer), and timing of copper asset sales and ongoing tower/lease negotiations create execution and timing uncertainties.

Telefonica Brasil Stock Down 4.7%

VIV stock traded down $0.73 during mid-day trading on Monday, hitting $14.87. The stock had a trading volume of 704,847 shares, compared to its average volume of 964,722. The company has a current ratio of 1.00, a quick ratio of 0.94 and a debt-to-equity ratio of 0.22. Telefonica Brasil has a 1-year low of $9.41 and a 1-year high of $17.25. The company has a fifty day moving average of $16.00 and a 200 day moving average of $14.13. The stock has a market capitalization of $24.18 billion, a price-to-earnings ratio of 21.24, a PEG ratio of 0.97 and a beta of 0.63.

Telefonica Brasil Dividend Announcement

The company also recently announced a dividend, which will be paid on Tuesday, July 21st. Shareholders of record on Friday, May 22nd will be given a $0.4562 dividend. The ex-dividend date of this dividend is Friday, May 22nd. Telefonica Brasil's dividend payout ratio is presently 65.71%.

Institutional Inflows and Outflows

Hedge funds have recently made changes to their positions in the stock. Arax Advisory Partners increased its holdings in shares of Telefonica Brasil by 54.4% during the 4th quarter. Arax Advisory Partners now owns 3,773 shares of the Wireless communications provider's stock valued at $45,000 after acquiring an additional 1,330 shares during the last quarter. Rhumbline Advisers increased its holdings in shares of Telefonica Brasil by 337.7% during the 1st quarter. Rhumbline Advisers now owns 4,233 shares of the Wireless communications provider's stock valued at $37,000 after acquiring an additional 3,266 shares during the last quarter. EverSource Wealth Advisors LLC increased its holdings in shares of Telefonica Brasil by 214.0% during the 2nd quarter. EverSource Wealth Advisors LLC now owns 4,766 shares of the Wireless communications provider's stock valued at $54,000 after acquiring an additional 3,248 shares during the last quarter. Advisors Asset Management Inc. acquired a new position in shares of Telefonica Brasil during the 1st quarter valued at about $52,000. Finally, AlTi Global Inc. acquired a new position in shares of Telefonica Brasil during the 4th quarter valued at about $130,000. Institutional investors and hedge funds own 5.16% of the company's stock.

Analyst Upgrades and Downgrades

VIV has been the subject of several research analyst reports. Barclays set a $16.50 price objective on Telefonica Brasil and gave the stock an "equal weight" rating in a research note on Friday, April 17th. Wall Street Zen raised Telefonica Brasil from a "buy" rating to a "strong-buy" rating in a research note on Sunday, January 11th. Bradesco Corretora downgraded Telefonica Brasil to a "neutral" rating in a research note on Tuesday, April 28th. Zacks Research raised Telefonica Brasil from a "hold" rating to a "strong-buy" rating in a research note on Monday, February 9th. Finally, New Street Research raised Telefonica Brasil from a "neutral" rating to a "buy" rating in a research note on Tuesday, April 7th. One equities research analyst has rated the stock with a Strong Buy rating, three have issued a Buy rating, four have assigned a Hold rating and three have assigned a Sell rating to the stock. Based on data from MarketBeat.com, the company presently has an average rating of "Hold" and an average price target of $14.08.

About Telefonica Brasil

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.

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