Telefonica Brasil SA Q4 FY2024 earnings call

Key Points from Christian Gebara - 2024 results: 66.5 million postpaid access (+7.6% growth), fiber homes connected +12.7% to 7 million, total customers over 116 million. Total revenues up 7.7% in Q4, mobile up 7%, fixed up 8%. EBITDA up 7.8% YOY. Invested BRL9.2B in 2024, operating cash flow BRL13.7B (+11% YOY). Paid BRL5.8B to shareholders, remuneration up 22% YOY. - Revenue mix shift: Postpaid, fiber, and B2B digital services drive growth. Mobile postpaid revenues up 9.1% in Q4, fixed revenues up 8% (highest annual growth). B2B digital services over 10% of total revenues. - ESG actions: Joined Dow Jones Best-in-Class World Index, Vivo Recicle collected 37 tonnes (3x last year), San Telefonica Vivo invested BRL50M, 50% of internships to Black talent. ### Key Points from David Melcon - OpEx: Total OpEx up 7.7%, cost of services/goods sold up 11% due to digital services growth. Cost of operations up 5.7%, reversal of provisions impacted EBITDA. - CapEx: BRL9.2B in 2024, CapEx over sales 16.4%, operating cash flow BRL13.7B (+11% YOY). Net income BRL5.5B (+10.3% YOY), EPS BRL3.38 (+11% YOY). - Shareholder remuneration: BRL5.8B paid in 2024 (+22% YOY), committed BRL4.5B for 2025, share buyback program BRL1.75B until Feb 2026. - Fixed voice migration: Self-composition agreement reached, moving from concession to authorization, will start capturing benefits, free up properties, sell copper, reduce costs.

Mobile segment: Ended 2024 representing 65% of total revenues. Postpaid revenues grew 9.1% in Q4, with postpaid access reaching 66.5 million in 2024 (+7.6% growth). Mobile base grew 3.3% YOY to over 102 million access. Fixed segment: Fixed revenues grew 8% in Q4, the highest annual growth for this segment. Fibers homes connected grew 12.7% in Q4 to 7 million, with FTTH growing 12.4% and data, ICT, and digital services up 21.1%. B2B digital services: Grew over 20% in 2024, with cloud solutions close to BRL 2 billion, up 32.6% YOY. New businesses combining B2B and B2C services represent over 10% of total revenues.

2024: Met guidance of 105% of net income to shareholders. ### 2025-2026: Committed to payout at least 100% of net income. Share buyback program BRL1.75B until Feb 2026. Reverse stock split and forward stock split approved to improve share liquidity.

• Macroeconomic factors, industry competition, and regulatory changes affecting migration and costs. - Risks related to execution of fixed voice migration process, including timing and impact on cash flow.

Q: Leonardo Olmos from UBS asked about dividends for 2025.

A: David Melcon said 2025 payout committed to 100% of net income, with capital reduction, interest, and share buybacks.

Q: Camila Koga from Bradesco BBI asked about mobile service revenue quarter-over-quarter slight decrease.

A: Christian Gebara explained prepaid softness, migration efforts, price increases starting in April.

Q: Bernardo Guttmann from XP asked about margin and copper/real estate sale speed.

A: Christian Gebara and David Melcon discussed margin trends, copper/real estate sale plans.

Q: Felipe Cheng from Santander asked about B2B revenues and customer migration.

A: Christian Gebara and David Melcon talked about B2B growth, customer migration timeline.

Q: Marcelo Santos from JPMorgan asked about concession migration margin and tools.

A: Christian Gebara and David Melcon explained migration tools and margin impact.

Q: Vitor Tomita from Goldman Sachs asked about commercial spend and fiber ARPU.

A: Christian Gebara and David Melcon discussed commercial spend trends and fiber ARPU factors.

Q: Lucca Brendim from Bank of America asked about copper extraction and prepaid pricing.

A: Christian Gebara addressed copper extraction and prepaid price plans.

Q: Phani Kanumuri from HSBC asked about CapEx and migration impact on FCF.

A: David Melcon and Christian Gebara discussed CapEx and FCF from migration.