Q3 FY2026
Filed Nov 10, 2026Telefônica Brasil 3Q26: net revenue +7.2% YoY to R$16,022.7 million, EBITDA +10.0% to R$7,135.6 million, net income +30.1% to R$2,456.4 million
Net revenue, EBITDA, operating cash flow, free cash flow and net income all grew double digits or near it on a YoY basis as printed, EBITDA margin rose 1.1 p.p. to 44.5%, and capex fell 1.6% YoY. Offsetting points are higher gross debt, a larger net financial expense and a one-off gain from copper-related asset sales in other operating income.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Net revenue, 3Q26other | R$16.02B | – | +7.2% |
| Mobile Service Revenue (MSR), 3Q26other | R$10.44B | – | +7.4% |
| Net Fixed Revenue, 3Q26other | R$4.47B | – | +2.7% |
| EBITDA, 3Q26other | R$7.14B | – | +10.0% |
| EBITDA margin, 3Q26other | 44.5% | – | +1.1 p.p. |
| EBITDA AL (After Leases), 3Q26other | 35.5% margin | – | +1.2 p.p. (EBITDA AL rose +10.8% YoY) |
| Depreciation and amortization, 3Q26other | R$3.61B | -9.4% (decrease of R$372.5 million QoQ) | -2.9% (decrease of R$107.1 million YoY) |
| Net financial result, 3Q26other | net expense of R$748.9 million | – | +12.4% |
| Net income attributable to Telefônica Brasil (IFRS), 3Q26other | R$2.46B | – | +30.1% |
| Net income attributable to Telefônica Brasil (IFRS), 9M26other | R$5.29B | – | +23.3% |
| Other operating income (expenses), 3Q26 gainsother | R$366 million in gains | – | Other Operating Income (Expenses) +69.4% YoY |
| Operating Cash Flow (EBITDA less Capex ex-IFRS 16 and licenses), 3Q26other | R$4.57B | – | +17.8% |
| Operating Cash Flow margin, 3Q26other | 28.6% | – | +2.6 p.p. |
| Capex (ex-IFRS 16 and licenses), 3Q26other | R$2.56B | – | -1.6% |
| Capex as % of Net Revenue, 3Q26other | 16.0% | – | -1.4 p.p. |
| Free Cash Flow (ex-IFRS 16 and licenses), 3Q26other | R$2.43B | – | +37.7% |
| Free Cash Flow margin over net revenues, 3Q26other | 15.1% | – | +3.4 p.p. |
| Gross debt excluding IFRS 16 leases, 30 Sep 2026other | R$4.82B | – | +21.1% |
| Net cash position (ex-IFRS 16), 30 Sep 2026other | R$2.42B | – | – |
| Net debt including IFRS 16 leases, 30 Sep 2026other | R$13.76B | – | – |
| Postpaid accesses, 3Q26other | 74.7M | – | +7.1% |
| Postpaid ARPU (ex-M2M and dongles), 3Q26other | R$53.8 | – | +0.6% |
| Postpaid churn, 3Q26other | 1.0% | – | – |
| Total accesses, 3Q26other | 120.2M | – | +3.0% |
| Mobile accesses, 3Q26other | 106.4M | – | +3.4% (from +2.6% in 2Q26) |
| FTTH homes passed, 3Q26other | 32.4M | – | +6.4% |
| FTTH homes connected, 3Q26other | 8.4M | – | +10.8% |
| FTTH take-up rate, 3Q26other | 26.0% | – | +1.0 p.p. |
| Average monthly revenue per RGU (LTM), 3Q26other | R$69.8 | – | +8.0% |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Mobile Service Revenue (MSR)Company says growth partly reflects the Vivo Total revenue reallocation between mobile and fiber, and is supported by sustained demand for higher-value mobile services. Postpaid revenues grew +9.1% YoY and rose to 87.3% of MSR (+1.4 p.p. YoY). | R$10.44B | – | +7.4% |
| Net Fixed RevenueCompany says growth partly reflects the Vivo Total revenue reallocation between mobile and fiber, supported by FTTH revenues (+5.7% YoY) and Corporate Data, ICT and Digital Services (+4.9% YoY). | R$4.47B | – | +2.7% |
| FTTH revenuesGrowth in FTTH revenues cited as a driver of Net Fixed Revenue. The filing says Vivo Total accounted for 86.2% of FTTH additions in own stores in 3Q26. | not stated as an amount in the document | – | +5.7% |
| Corporate Data, ICT and Digital Services revenuesCompany describes solid growth from expansion of the digital services portfolio. | R$1.45B | – | +4.9% |
| Fixed Digital B2B revenuesCompany attributes growth to continued expansion of its digital services portfolio. | R$1.03B | – | +6.3% |
| Digital services revenues (B2B), LTM 3Q26Represents 8.9% of total revenue (+0.3 p.p. YoY). B2B represented 22.4% of Company revenues LTM 3Q26. | R$5.61B | – | +10.9% (LTM) |
| B2C Financial Services, LTM 3Q26Vivo Pay growth pillar covering credit, payment and protection. More than 48% of smartphones sold in stores in 3Q26 were bundled with insurance. | R$458M | – | +13.6% (LTM) |
| OTTs (B2C new business), LTM 3Q26Subscriber base of 4.8 million users, up +29.0% YoY. Company launched streaming bundles of up to six services from R$49.90. | R$965M | – | +30.5% (LTM) |
| Health & Wellness (Vale Saúde)Platform reached more than 620 thousand subscribers in LTM 3Q26. The filing does not give a YoY change for this revenue. | R$133M | – | – |
| Cost of services and products soldCompany attributes growth to expansion of digital services and cloud revenues, the Handsets & Consumer Electronics business and higher B2B equipment sales. Services costs +3.0% YoY (11.2% of revenues, -0.5 p.p.). Products sold costs +37.9% YoY (8.5% of revenues, +1.9 p.p.). | not stated as an amount in the document | – | +15.6% |
| Operating expensesCompany says flat YoY reflects higher personnel and G&A costs, largely offset by commercial and infrastructure efficiencies, concession benefits and gains from migration-related asset sales. Personnel +7.8% YoY (10.6% of revenues). Commercial & Infrastructure -0.9% YoY (22.4% of revenues). Provision for bad debt +1.8% YoY (2.5% of revenues). G&A +14.3% YoY (2.5% of revenues). | not stated as an amount in the document | – | 0.0% |
Capital returns
- Shareholder remuneration paid in 9M26: R$6,990.0 million, including R$2,990.0 million of interest on capital (IoC) declared in 2025 and R$4,000.0 million related to capital reduction. The Company describes this as up +9.6% compared to FY2025.
- On November 10, 2026, the Executive Board approved payment of the IoC declared in February 2026, R$325.0 million, to be paid on December 15, 2026. The Company says this brings total 2026 shareholder remuneration to R$7,315.0 million.
- R$3,195.0 million of IoC declared in 2026 has payment dates yet to be determined, subject to an April 30, 2027 deadline. The Company describes this as up +4.5% vs. FY2025.
- Share buyback: R$1,000.0 million still available under the plan.
- The Company reiterated its commitment to distribute at least 100% of FY26 net income to shareholders.
What drove it
- Company says revenue growth was driven by postpaid (+9.1% YoY), FTTH (+5.7% YoY) and Corporate Data, ICT and Digital Services (+4.9% YoY).
- Company says the Vivo Total one-off rebalancing of revenues between mobile and fiber partly reflects MSR and Net Fixed Revenue growth, with no impact on total service revenue according to the filing.
- Company attributes EBITDA growth to strong performance across the quarter, with margin expansion of +1.1 p.p. YoY to 44.5%.
- Other operating income benefited from R$366 million in gains, which the Company says mainly reflect copper-related asset sales (net of costs). The filing also cites lower tax recovery benefits versus the prior year.
- Company says D&A decreased mainly reflecting the completion of accelerated depreciation of legacy technologies, including copper-related assets.
- Company says the net financial expense increase was mainly driven by lower interest income, higher monetary adjustment expenses related to the FISTEL TFF liability and increased lease liabilities tied to network infrastructure.
- Company says the reversal of judicial deposits and lower tax payments supported free cash flow.
- Company attributes ARPU decline in fiber to the Vivo Total rebalancing. Churn in fiber was flat at 1.4% per the filing.
Concerns
- Gross debt rose 21.1% YoY to R$4,817.5 million. The filing attributes this mainly to the assumption of R$0.9 billion in FiBrasil debentures.
- Net financial result expense rose 12.4% YoY to R$748.9 million. The filing cites lower interest income, higher FISTEL TFF monetary adjustments and higher lease liabilities.
- Other operating income includes R$366 million of gains from copper-related asset sales, which are non-recurring in nature according to the filing's description of asset sales.
- Cost of services and products sold grew 15.6% YoY, with products sold costs up 37.9% YoY, which the filing links to handset sales and B2B equipment sales.
- Company notes that fiber ARPU decreased following the Vivo Total rebalancing.
- Personnel (+7.8% YoY) and G&A (+14.3% YoY) costs rose, which the filing attributes to salary inflation, cloud consumption and digital services expansion.
What to watch
- Payment of R$325.0 million IoC on December 15, 2026, and timing of the R$3,195.0 million IoC declared in 2026 ahead of the April 30, 2027 deadline.
- Whether the Company meets its commitment to distribute at least 100% of FY26 net income, with R$1,000.0 million buyback capacity remaining.
- Trajectory of gross debt after the FiBrasil debentures and the net financial expense trend.
- Sustainability of Other Operating Income now that the 3Q26 figure includes R$366 million of gains from copper-related asset sales.
- Trend of postpaid ARPU (+0.6% YoY) and fiber ARPU following the Vivo Total rebalancing.
- Cost of products sold growth (+37.9% YoY) and whether the handset and B2B equipment business continues to lift cost growth.
- The 3Q26 Results Call scheduled for November 11, 2026, at 11:00 a.m. Brasília time.
Balance sheet and cash flow
- Operating Cash Flow of R$4,574.6 million (+17.8% YoY), margin 28.6% (+2.6 p.p. YoY). The Company describes this as one of the highest OpCF margins on record.
- Free Cash Flow of R$2,426.3 million (+37.7% YoY). The Company says cash generation benefited from the reversal of judicial deposits and lower tax payments (-23.6% YoY), partly offset by higher working capital consumption.
- Net cash position (ex-IFRS 16) of R$2,420.4 million at September 30, 2026. Including IFRS 16 leases, net debt totaled R$13,760.8 million.
- Gross debt excluding IFRS 16 leases of R$4,817.5 million (+21.1% YoY). The Company says this is primarily driven by the assumption of R$0.9 billion in FiBrasil debentures following the merger of FiBrasil into the Company.
- Of gross debt, 99% is in local currency and 1% in foreign currency. The Company states its FX exposure is fully hedged through derivatives.
- The Company notes FISTEL TFF fees for 2020 to 2026 totaling R$7.5 billion are not included in debt.
Analysis
Telefônica Brasil reported 3Q26 results under IFRS with net revenue of R$16,022.7 million, up 7.2% YoY. Growth was led by postpaid revenue (+9.1% YoY), which rose to 87.3% of Mobile Service Revenue, and by FTTH revenue (+5.7% YoY). The Company states that part of the growth in mobile and fixed revenue reflects a one-off rebalancing of Vivo Total revenues between mobile and fiber, and it says this had no effect on total service revenue. Operating volumes also grew: total accesses reached 120.2 million (+3.0% YoY), mobile accesses accelerated to +3.4% from +2.6% in 2Q26, and homes connected reached 8.4 million (+10.8% YoY).
EBITDA rose 10.0% YoY to R$7,135.6 million, with margin of 44.5%, up 1.1 p.p. Cost lines are mixed. Cost of services and products sold rose 15.6% YoY, driven by a 37.9% increase in products sold, which the filing links to handset sales and higher B2B equipment sales. Operating expenses were flat YoY at 0.0%. Commercial and infrastructure costs fell 0.9%, while personnel rose 7.8% and G&A rose 14.3%. Other operating income of R$366 million, which the Company says mainly reflects copper-related asset sales, supported the result, and the filing also notes lower tax recovery benefits than in the prior year.
Net income attributable to Telefônica Brasil was R$2,456.4 million, up 30.1% YoY, and R$5,290.0 million for 9M26, up 23.3%. The Company attributes the quarterly increase to revenue growth, EBITDA expansion and lower D&A, which fell 2.9% YoY as legacy copper-related assets completed accelerated depreciation. Net financial expense rose 12.4% to R$748.9 million, which the filing attributes to lower interest income, higher FISTEL TFF monetary adjustments and higher lease liabilities.
Cash generation and capital allocation were strong. Capex fell 1.6% YoY to R$2,561.0 million, or 16.0% of net revenue (-1.4 p.p.). Operating cash flow rose 17.8% to R$4,574.6 million, and free cash flow rose 37.7% to R$2,426.3 million, which the Company partly attributes to the reversal of judicial deposits and lower tax payments. Shareholder remuneration paid in 9M26 was R$6,990.0 million. The Company says total 2026 remuneration will reach R$7,315.0 million once the R$325.0 million IoC is paid on December 15, 2026, and it reaffirmed a commitment to distribute at least 100% of FY26 net income.
Balance sheet leverage rose at the gross level. Gross debt excluding IFRS 16 reached R$4,817.5 million (+21.1% YoY), which the filing primarily attributes to R$0.9 billion of FiBrasil debentures assumed in the merger. The Company still reports a net cash position of R$2,420.4 million excluding IFRS 16 leases, and net debt including leases of R$13,760.8 million. The filing does not provide an operating guidance range for 2026, so this read cannot assess the guide against prior expectations.
Not in the filing
stated, not guessed- Prior-year and prior-quarter absolute values for most metrics (net revenue, EBITDA, net income, OCF, FCF, capex, D&A and others) are not printed in the document; only percentage changes are given.
- Amounts for cost of services and products sold, personnel, commercial and infrastructure, provision for bad debt, G&A and total operating expenses are not printed; only percentage changes and percentages of revenue are given.
- Postpaid revenue amount in R$ is not printed; only its YoY change (+9.1%) and share of MSR (87.3%).
- FTTH revenue amount in R$ is not printed; only its YoY change (+5.7%).
- Fixed Voice, xDSL, FTTC and IPTV (Other Fixed Revenues) amounts are not printed.
- Income statement table, balance sheet table and operating indicators tables are referenced but their figures are not present in the extracted text.
- No operating guidance figures (revenue, margin, opex, tax rate) for 2026 or later are printed; only shareholder remuneration commitments.
- No prior-year net financial result or interest, tax and income tax lines in absolute terms are printed.
- Share price performance (base 100 chart) is shown without a printed reaction figure for the day of release.
- Health & Wellness revenue period (LTM or quarter) and YoY change are not explicitly printed.
- No named executive quotes are present in the extracted text; the only named individual is the signatory, João Pedro Carneiro, Investor Relations Director.
- Nominal EBITDA AL absolute amount is not printed.
Written by an AI language model from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure is checked against the filing text, and a metric the filing does not print, or whose value, prior period and change do not add up, is dropped from the metrics. The model can still misread a table, in the metrics or in the text, so check a number in the filing before you rely on it. Consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.