Telefonica Brasil beats forecasts with 29% earnings surge

Telefonica Brasil (NYSE:VIV), operating under the Vivo brand, reported fourth-quarter earnings that significantly outpaced analyst projections, driven by a strategic shift toward premium postpaid and fiber-optic services.

The São Paulo-based telecommunications giant posted net income of $347.5 million, or 22 cents per share, for the quarter ending December 31, 2025.

The result beat the Zacks Investment Research consensus estimate of 17 cents per share by roughly 29%.

Revenue for the period reached $2.89 billion, a steady climb supported by Brazil's accelerating digital transformation.

For the full year 2025, the company reported a total profit of $1.1 billion, or 68 cents per share, on annual revenue of $10.67 billion.

The company’s performance was anchored by its "Vivo Total" convergence strategy, which bundles mobile and fiber services.

Postpaid mobile accesses grew 6.5% year-over-year to 70.8 million, while Fiber-to-the-Home (FTTH) connections jumped 12% to 7.8 million.

These high-value segments now represent a larger portion of the company’s total revenue mix, shielding it from the volatility of the prepaid market.

Alongside the earnings release, Telefonica Brasil’s board approved a new share buyback program for 2026–2027, totaling up to R$1 billion (approximately $200 million).

This initiative follows the successful completion of a 49.6 million share buyback in the previous cycle, underscoring management’s focus on capital allocation and shareholder returns.

While the company faces headwinds from Brazil's high-interest-rate environment and rising personal expenses—which grew 8.8% in 2025 due to wage adjustments—Vivo’s EBITDA margin expanded to 43.4%, reflecting disciplined cost management and the operational efficiency of its new AI-driven service platforms.