4Q24 Results: Telefônica Brasil S.A.

Rhea-AI Summary

Telefônica Brasil (VIV) reported strong Q4 2024 results with notable growth across key metrics. Net revenue increased by 7.7% YoY, driven by mobile postpaid revenue growth of 9.1% YoY. The postpaid customer base expanded 7.6% YoY to 66.5 million subscribers.

Fixed revenue grew 8.0% YoY, with FTTH revenue up 12.4% YoY. The company's fiber network now reaches 29.1 million homes (+11.2% YoY) with 7.0 million connected homes (+12.7% YoY). EBITDA grew 7.8% YoY with a 42.5% margin.

For full-year 2024, net income reached R$5,548 million (+10.3% YoY). The company distributed R$5,845 million to shareholders, representing a 22.1% YoY increase and a 105.3% payout ratio. Telefônica Brasil committed to maintaining distributions at or above 100% of net income for 2025 and 2026.

Positive

• Net revenue up 7.7% YoY
• Mobile postpaid revenue grew 9.1% YoY
• FTTH revenue increased 12.4% YoY
• Net income up 10.3% YoY to R$5,548M
• Shareholder distributions increased 22.1% YoY
• Record low churn rate of 0.99%
• EBITDA growth of 7.8% YoY

Negative

• Capex intensity decreased 0.8 p.p. YoY
• EBITDA margin flat at 42.5% YoY

Insights

Financial Analyst

Telefônica Brasil's Q4 2024 results demonstrate exceptional operational execution in a competitive telecom market. The 7.7% revenue growth significantly outpaces Brazil's GDP growth, indicating market share gains and successful monetization strategies. The company's postpaid mobile segment shows particular strength with 9.1% revenue growth and an industry-leading churn rate of 0.99% – remarkably low for telecom standards where 1.3-1.5% is typically considered good performance.

The company's strategic pivot toward higher-value services is yielding results, evidenced by the 21.1% growth in Corporate Data, ICT, and Digital Services. This diversification beyond traditional telecom services creates a more resilient revenue stream and higher-margin business mix. The fiber infrastructure expansion continues to be a key differentiator, with FTTH revenue growing 12.4% and connected homes increasing by 12.7% to 7 million.

The aggressive 5G rollout to 504 cities (nearly tripling year-over-year) positions Telefônica Brasil to capitalize on next-generation services and applications. This network now covers 61.3% of Brazil's population, creating a substantial competitive advantage in a market where digital adoption continues to accelerate.

Financial discipline is evident in the declining capital intensity ratio (Capex/Revenue) of 16.4% (-0.8 percentage points YoY), which helped drive the 11% increase in operating cash flow. This efficiency improvement, combined with strong top-line growth, demonstrates exceptional operational leverage.

The commitment to distribute ≥100% of net income through 2026 signals management's confidence in sustainable cash generation. While such high payout ratios might typically raise concerns about underinvestment, the declining capital intensity suggests the company has passed peak infrastructure investment cycles while maintaining growth momentum.

SÃO PAULO, Feb. 25, 2025 /PRNewswire/ --

Telefônica Brasil - (B3: VIVT3; NYSE: VIV) announces its results for 4Q24.

Strong operating performance led to robust net income growth and free cash flow generation.

R$ million	4Q24	4Q23	% Y-o-Y	2024	2023	% Y-o-Y
Net Operating Revenue	14,581	13,535	7.7	55,845	52,100	7.2
Mobile Services	9,201	8,602	7.0	36,022	33,216	8.4
FTTH	1,829	1,627	12.4	7,093	6,195	14.5
Corporate Data, ICT and Digital Services	1,346	1,111	21.1	4,735	4,307	9.9
Handsets and Electronics	1,177	1,042	13.0	3,730	3,453	8.0
Other Revenues¹	1,029	1,153	(10.7)	4,265	4,930	(13.5)
Total Costs	(8,383)	(7,783)	7.7	(32,965)	(30,782)	7.1
EBITDA	6,199	5,752	7.8	22,880	21,318	7.3
EBITDA Margin	42.5 %	42.5 %	0.0 p.p.	41.0 %	40.9 %	0.1 p.p.
EBITDA AL²	4,831	4,461	8.3	17,796	16,572	7.4
EBITDA AL Margin	33.1 %	33.0 %	0.2 p.p.	31.9 %	31.8 %	0.1 p.p.
Net Income	1,763	1,601	10.1	5,548	5,029	10.3
Earnings per Share (EPS)	1.08	0.97	11.5	3.38	3.03	11.3
CAPEX ex-IFRS 16	2,456	2,295	7.0	9,166	8,960	2.3
Operating Cash Flow (OpCF)	3,742	3,457	8.2	13,714	12,358	11.0
OpCF Margin	25.7 %	25.5 %	0.1 p.p.	24.6 %	23.7 %	0.8 p.p.
Operating Cash Flow AL (OpCF AL)	2,374	2,167	9.6	8,629	7,612	13.4
OpCF AL Margin	16.3 %	16.0 %	0.3 p.p.	15.5 %	14.6 %	0.8 p.p.
Free Cash Flow	1,080	592	82.4	8,219	8,148	0.9
Total Subscribers (Thousand)	116,050	113,001	2.7	116,050	113,001	2.7

^{1 – Other Revenues include Voice, xDSL, FTTC and IPTV. 2 – AL means After Leases.}

Net revenue grew (+7.7% YoY), driven by the strong performance of mobile postpaid revenue (+9.1% YoY). Postpaid's performance is related to the increase in customer base (+7.6% YoY), which totaled 66.5 million in the quarter, driven by migrations from prepaid and the addition of new customers, that contributed to the +1.6% YoY increase in postpaid ex-M2M and ex-dongles ARPU, to R$52.1, while churn stood at historically low levels, 0.99%.

Fixed revenue increased +8.0% YoY, driven by the FTTH (+12.4% YoY) and Corporate Data, ICT and Digital Services (+21.1% YoY) revenues. Our FTTH network reached 29.1 million homes passed (+11.2% YoY), with 7.0 million homes connected (+12.7% YoY).

EBITDA expanded +7.8% YoY, with a margin of 42.5%, flat when comparing to 4Q23. EBITDA AL expanded by +8.3% YoY, with a margin of 33.1% (+0.2 p.p. YoY).

In 2024, Capex totaled R$9,166 million (+2.3% YoY), equivalent to 16.4% of revenues (-0.8 p.p. YoY), reflecting a decrease in investment intensity. Investments were directed towards strengthening our 5G network, which is already present in 504 cities (+2.9x YoY), covering 61.3% of the Brazilian population, and expanding our fiber operation.

Operating Cash Flow for the year was R$13,714 million (+11.0% YoY), with a margin of 24.6% (+0.8 p.p. YoY) over net revenue.

Net income attributed to Telefônica Brasil reached R$5,548 million in 2024 (+10.3% YoY). The Company delivered on its guidance of shareholder remuneration paid in 2024, distributing R$5,845 million (vs R$4,786 million in 2023), a growth of +22.1% YoY, reflecting a payout over net income of 105.3%. For the years 2025 and 2026, the Company reaffirms its commitment to distribute an amount equal to or greater than 100% of net income for each fiscal year.

To download the complete version of the Company's earnings release, please visit our website: https://ri.telefonica.com.br/en 

View original content:https://www.prnewswire.com/news-releases/4q24-results-telefonica-brasil-sa-302385402.html

SOURCE Telefônica Brasil S.A.

FAQ

What was Telefônica Brasil's (VIV) revenue growth in Q4 2024?

Net revenue grew 7.7% year-over-year, driven by 9.1% growth in mobile postpaid revenue.

How many homes does Telefônica Brasil's FTTH network reach in Q4 2024?

The FTTH network reached 29.1 million homes passed (+11.2% YoY) with 7.0 million homes connected (+12.7% YoY).

What is VIV's dividend payout ratio for 2024?

The payout ratio was 105.3% of net income, with total shareholder distributions of R$5,845 million.

How much did Telefônica Brasil's net income grow in 2024?

Net income reached R$5,548 million, representing a 10.3% increase year-over-year.

What is Telefônica Brasil's 5G coverage in Brazil as of Q4 2024?

5G network is present in 504 cities, covering 61.3% of the Brazilian population.