Vivo has a profit of R $ 942 million and grows in fiber optics | Telecommunications

THE Telefônica Brasil released the financial results for the 1st quarter of 2021: the owner of the Alive recorded stable revenue, but suffered an 18% drop in net income. The company celebrates the addition of mobile phone, fiber optic and IPTV customers, while wiping the copper access base. The company also announced the new Vida V service, which will have medical consultations via telemedicine and wellness programs.

Vivo had a drop in profit during the 1st quarter of 2021 (Image: Felipe Ventura / Tecnoblog)

Check out the main indicators for the 1st quarter of 2021 and the comparison with the same period of the previous year:

Indicator 1st quarter of 2021 1st quarter of 2020 Difference
Net operating revenue R $ 10.84 billion R $ 10.82 billion + 0.2%
Net profit R $ 942 million R $ 1.15 billion -18.3%
Investments R $ 1.94 billion R $ 1.64 billion + 18%
Number of customers (total accesses) 95.8 million 93.08 million + 2.9%

Vivo says that the reduction in profit is a reflection of the increase in depreciation and financial expenses, which were partially offset by lower taxes.

Vivo loses market share in postpaid

The mobile segment accounted for R $ 7.14 billion of all net operating revenue, which means that the cell phone business is the most important for Vivo’s finances. Revenue was stable in comparison with the previous year, increasing only in the prepaid segment (+ 4%).

Vivo ended the quarter with 79.6 million mobile lines, representing an annual growth of 6.6%. Postpaid accounts for 57.7% of cellular contracts, and the company celebrates that the Vivo Easy digital plan more than doubled in comparison with the same period of the previous year, although it does not disclose how many customers use the service.

Still on postpaid, Vivo continues to lead the segment, but lost 2% of the market to other operators. Claro had the best performance in the period and grew 19.4% in invoice contracts, which have higher monthly expenses with cellular services in comparison with prepaid.

Tele also says that more than 80% of the prepaid customer base use the Vivo Turbo offer, which has weekly or biweekly recurrence and guarantees a higher amount of recharges and predictability in revenue.

Vivo ended the month of March with the presence of cellular services in 4,470 municipalities, of which 3,839 were covered with 4G, 4,637 with 3G and 3,892 with 2G.

Vivo has a drop in fixed revenue, but grows in optical fiber

Vivo had a drop of 1.4% in net revenue from fixed services, driven by disconnections of old copper technologies (ADSL). The operator reduced its fixed accesses by 12% and reached the mark of 16.1 million contracts.

Vivo Fibra (Image: Lucas Braga / Tecnoblog)

Vivo Fibra has growth in the 1st quarter of 2021 (Image: Lucas Braga / Tecnoblog)

In newer technologies, Vivo grew 6.1% in customers, but the jump was positive only in terms of pay TV and fiber optic accesses. Over the past year, the operator disconnected 901 thousand FTTC internet accesses, used in areas of the old GVT where fiber does not reach the customer’s home.

During the quarter, Vivo Fibra internet reached 10 new cities and expanded the capacity to serve an additional 387 thousand homes (home passed). In total, the operator’s optical network reaches 276 municipalities and 16.3 million households.

It is worth remembering that Vivo closed an agreement with a Canadian fund to create the neutral provider FiBrasil, which will be responsible for a fiber optic network for 5.5 million homes in four years. The new company will focus on medium-sized cities outside the state of São Paulo, and other operators will be able to rent this infrastructure.

Vivo bets on health and finance platform

Vivo also announced the creation of Vida V, which will be a health and wellness marketplace. The first partner company is Teladoc Health, which will offer medical consultations via telemedicine.

Vida V must also offer wellness and health programs, pharmacy discounts and other benefits. The platform can be used by Vivo customers and non-customers, with a launching date for June.

In April, Vivo relaunched its Vivo Pay digital wallet with Pix support, payment slips, prepaid virtual card and internet prepaid bonus. The service can also be used by non-customers of the operator and replaces the old Vivo Recarga.

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