2Q26 Results: Telefonica Brasil S.A.

Rhea-AI Summary

Telefonica Brasil (NYSE: VIV) reported 2Q26 net operating revenue of R$15,757 million, up 7.6% YoY, driven by mobile services, FTTH and corporate data/ICT. EBITDA rose 10.9% YoY to R$6,581 million, with margin improving 1.3 p.p. to 41.8%, while EBITDA AL grew 11.6%.

Net income reached R$1,573 million, an increase of 17.0% YoY, and EPS was R$0.49, up 18.5%. Operating cash flow rose 14.3% YoY to R$3,992 million. Capex was R$2,589 million (16.4% of revenue). Shareholder remuneration paid in 7M26 totaled R$6,990 million (+31.6% YoY), and a share buyback of up to R$1.0 billion is authorized through February 2027.

Positive

• Net operating revenue R$15,757m in 2Q26, up 7.6% YoY
• EBITDA R$6,581m in 2Q26, up 10.9% YoY; margin 41.8%
• Net income R$1,573m in 2Q26, up 17.0% YoY
• Operating cash flow R$3,992m in 2Q26, up 14.3% YoY
• Earnings per share R$0.49 in 2Q26, up 18.5% YoY
• Shareholder remuneration R$6,990m in 7M26, up 31.6% YoY, plus R$1.0b buyback program

Negative

• Free cash flow R$2,661m in 2Q26, down 10.7% YoY
• Free cash flow 6M26 R$4,861m, down 4.8% YoY

News Explained

The company states a floor of at least 100% of FY2026 net income for shareholder distributions, alongside already-paid capital-reduction distributions.

The reported 2Q26 results add that Telefônica Brasil paid R$6,990.0 million in shareholder remuneration during the first seven months of 2026, including R$2,990.0 million of interest on capital declared in 2025 and R$4,000.0 million tied to a capital reduction.

The company also reports R$2,220.0 million of interest on capital declared by July 2026 and states a commitment to distribute at least 100% of FY2026 net income.

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Following this news, VIV has declined 6.26%, reflecting a notable negative market reaction. Our momentum scanner has triggered 33 alerts so far, indicating elevated trading interest and price volatility. The stock is currently trading at $13.17.

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Sao Paulo, Brazil--(Newsfile Corp. - July 28, 2026) - Telefônica Brasil (B3: VIVT3) (NYSE: VIV) announces its results for 2Q26.

Consistent Revenue and EBITDA performance drives +17.0% YoY growth in Net Income.

R$ million		2Q26			2Q25			% YoY			6M26			6M25			% YoY
Net Operating Revenue		15,757			14,645			7.6			31,214			29,035			7.5
Mobile Services		10,183			9,555			6.6			20,064			18,827			6.6
FTTH		2,147			1,940			10.7			4,223			3,839			10.0
Corporate Data, ICT and Digital Services		1,467			1,361			7.8			2,890			2,673			8.1
Handsets and Electronics		1,048			820			27.8			2,199			1,729			27.2
Other Revenues¹		913			969			(5.8	)		1,839			1,968			(6.5	)
Total Costs		(9,177	)		(8,712	)		5.3			(18,424	)		(17,399	)		5.9
EBITDA		6,581			5,933			10.9			12,790			11,637			9.9
EBITDA Margin		41.8%			40.5%			1.3 p.p.			41.0%			40.1%			0.9 p.p.
EBITDA AL²		5,139			4,607			11.6			9,939			8,983			10.6
EBITDA AL² Margin		32.6%			31.5%			1.2 p.p.			31.8%			30.9%			0.9 p.p.
Net Income³		1,573			1,344			17.0			2,834			2,403			17.9
Earnings per Share (EPS)4		0.49			0.42			18.5			0.89			0.74			19.6
CAPEX ex-IFRS 165		2,589			2,439			6.1			4,636			4,308			7.6
CAPEX ex-IFRS 165/Net Revenue		16.4%			16.7%			(0.2) p.p.			14.9%			14.8%			0.0 p.p.
Operating Cash Flow (OpCF)6		3,992			3,494			14.3			8,154			7,329			11.3
OpCF6 Margin		25.3%			23.9%			1.5 p.p.			26.1%			25.2%			0.9 p.p.
Operating Cash Flow AL (OpCF AL)7		2,551			2,168			17.7			5,303			4,676			13.4
OpCF AL7 Margin		16.2%			14.8%			1.4 p.p.			17.0%			16.1%			0.9 p.p.
Free Cash Flow		2,661			2,979			(10.7	)		4,861			5,103			(4.8	)
Total Accesses (Thousand)		118,809			116,190			2.3			118,809			116,190			2.3

 

1 - Other Revenues include Fixed Voice, xDSL, FTTC and IPTV. 2 - AL means After Leases. 3 - Net Income attributable to Telefônica Brasil. 4 - Earnings per Share (EPS) calculated based on net income attributable to Telefônica Brasil divided by the weighted average of outstanding shares in the period. EPS for 2025 was recalculated considering the effects of the Split and Reverse Stock Split effective on April 15, 2025. 5 - Does not include amounts related to IFRS 16 effects and licenses. 6 - Operating Cash Flow is equivalent to EBITDA less Capex ex-IFRS 16 and licenses. 7 -Operating Cash Flow AL is equivalent to EBITDA After Leases less Capex ex-IFRS 16 and licenses.

Net revenue reached R$15,757.4 million, increasing +7.6% YoY, supported by strong postpaid (+7.9% YoY) and FTTH revenues (+10.7% YoY), as well as the continued expansion of Corporate Data, ICT and Digital Services (+7.8% YoY). Human Postpaid remained a key growth driver, with +3.6 million net additions LTM, bringing the base to 52.4 million accesses (+7.3% YoY). ARPU increased to R$53.9 (+0.8% YoY), while churn remained at a historically low level of 1.0%.

Our Fiber business continued to deliver solid execution, with the footprint expanding to 32.0 million homes passed (+6.4% YoY) and homes connected reaching 8.2 million (+11.3% YoY) in 2Q26. This performance supported a +1.1 p.p. increase in take-up (25.6% in 2Q26), while ARPU increased +0.7% QoQ and churn fell to 1.4% during the quarter.

EBITDA registered double-digit growth, +10.9% YoY, the strongest performance since 3Q23, with a margin of 41.8%, +1.3 p.p. YoY. EBITDA AL increased +11.6% YoY, with margin expansion of +1.2 p.p. YoY to 32.6%.

Capex totaled R$2,588.5 million, up +6.1% YoY, lower than 1Q26 growth rate (+9.6% YoY), representing 16.4% of revenues, a reduction of -0.2 p.p. YoY. Investments remained focused on expanding and enhancing our network infrastructure, with 5G now available in 978 municipalities and our FTTH network reaching 453 cities.

Operating Cash Flow reached R$3,992.3 million, increasing +14.3% YoY, leading to a margin of 25.3% (+1.5 p.p. YoY). Net Income totaled R$1,572.5 million, rising +17.0% YoY.

Shareholder remuneration paid out in 7M26 reached R$6,990.0 million, surpassing the total amount distributed in 7M25 by +31.6%. This amount comprises R$2,990.0 million in interest on capital declared in 2025 and R$4,000.0 million related to capital reduction. In addition, as of July 2026, we had already declared R$2,220.0 million in interest on capital, representing an increase of +34.5% YoY in 7M26. Earlier this year, the Board of Directors approved a Share Buyback Program of up to R$1.0 billion, with repurchases authorized until February 2027. We remain firmly committed to distributing to shareholders at least 100% of FY2026 net income.

TELEFÔNICA BRASIL - Investor Relations
ir.br@telefonica.com

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

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/306906

FAQ

How did Telefonica Brasil (VIV) perform financially in 2Q26?

Telefonica Brasil reported higher revenue, EBITDA and net income in 2Q26. According to the company, net operating revenue rose 7.6% YoY to R$15,757 million and EBITDA increased 10.9% to R$6,581 million, while net income grew 17.0% to R$1,573 million.

What was Telefonica Brasil (VIV) net income and EPS in 2Q26?

Telefonica Brasil posted net income of R$1,573 million and EPS of R$0.49 in 2Q26. According to the company, net income grew 17.0% year over year and earnings per share increased 18.5% compared with 2Q25, reflecting improved profitability.

How did EBITDA and margins evolve for Telefonica Brasil (VIV) in 2Q26?

Telefonica Brasil’s EBITDA increased to R$6,581 million in 2Q26, with margin expansion. According to the company, EBITDA grew 10.9% year over year and the EBITDA margin improved by 1.3 percentage points, reaching 41.8%, supported by revenue growth and cost control.

What were Telefonica Brasil (VIV) 2Q26 free cash flow and operating cash flow?

Telefonica Brasil generated higher operating cash flow but lower free cash flow in 2Q26. According to the company, operating cash flow reached R$3,992 million, up 14.3% YoY, while free cash flow totaled R$2,661 million, representing a 10.7% year-over-year decline in the quarter.

How much did Telefonica Brasil (VIV) invest in Capex during 2Q26?

Telefonica Brasil reported Capex ex-IFRS 16 of R$2,589 million in 2Q26. According to the company, this represented 6.1% year-over-year growth and corresponded to 16.4% of net operating revenue, with investments focused on 5G expansion and FTTH network coverage.

What shareholder returns did Telefonica Brasil (VIV) provide in 7M26?

Telefonica Brasil paid significantly higher shareholder remuneration in the first seven months of 2026. According to the company, total payouts reached R$6,990 million, up 31.6% YoY, plus a share buyback program of up to R$1.0 billion authorized until February 2027.

What is Telefonica Brasil (VIV) policy for distributing 2026 net income?

Telefonica Brasil plans to distribute at least 100% of 2026 net income to shareholders. According to the company, this commitment complements remuneration already paid and declared in 7M26 and is supported by its cash generation, capital structure and approved share buyback program.