Telefônica Brasil's Q1 2025: Unraveling Key Contradictions in Strategy, Pricing, and Investment

Prepaid customer migration strategy, fiber ARPU growth dynamics, M&A strategy and fibers expansion, back book price increases, and CapEx intensity and management are the key contradictions discussed in Telefônica Brasil S.A.'s latest 2025Q1 earnings call.



Revenue and Profitability Growth:
- Telefônica Brasil S.A. (Vivo) reported total revenues of BRL14.4 billion for Q1 2025, with mobile service revenue growing by 6.5% and fixed revenues expanding by 6.2%.
- This growth was driven by strong demand for postpaid and fiber services and the positive impact of digital service offerings.

Postpaid and Fiber Service Expansion:
- Vivo's postpaid service reached over 67 million customers, achieving a year-over-year growth of 7.7%, while fiber services increased their customer base by 12.9%.
- The expansion was due to successful up-selling initiatives and the company's continued investment in 5G technology, leading to increased customer loyalty and reduced churn.

Digital Service and B2B Growth:
- Vivo's digital services generated over BRL43 billion in revenues in the last 12 months, with B2B revenues amounting to BRL12.3 billion, representing 22% of their business.
- This growth was attributed to the integration of new businesses like accessories and cloud services, expanding customer offerings and market positioning.

ESG and Sustainability Initiatives:
- Vivo was recognized as the leading Brazilian company in the Dow Jones Best-in-Class Index and ranked sixth among Telcos globally for its ESG practices.
- Initiatives such as the Futuro Vivo platform and Raízes Vivas campaign demonstrate the company's commitment to environmental protection and social responsibility.