Vivo has a profit of R$1.31 billion and increases the goal for the expansion of optical fiber – Telecommunications – Tecnoblog

A Telefonica Brasil released the financial results for the 3rd quarter of 2021. Vivo had a profit of R$ 1.31 billion, which represents a growth of 8.5% in the annual comparison. The operator achieved a good performance with the increase of mobile telephony customers and revised the goal for expansion of the optical fiber network.

Vivo store in São Paulo (Image: Felipe Ventura/Tecnoblog) (Image: Felipe Ventura / Tecnoblog)

Vivo – Financial results for the 3rd quarter of 2021

See Vivo’s main financial indicators for the 3rd quarter of 2021 and the comparison with the same period in 2020:

Indicator 3rd quarter of 2021 3rd quarter of 2020 Difference
Net operating revenue BRL 11.03 billion BRL 10.79 billion +2,2%
Net profit BRL 1.31 billion BRL 1.21 billion +8,5%
Capex (investments) BRL 2.15 billion BRL 1.80 billion +19,3%
Number of customers (total accesses) 94.42 million 93.71 million +4%

Vivo increases postpaid and prepaid mobile customers

The mobile segment is sovereign in generating revenue for Vivo. It was responsible for R$ 7.39 billion in sales, an increase of 3.2% compared to the same period of the previous year.

Vivo managed to grow its mobile access base to 82.2 million lines, representing an annual increase of 7.2%. The biggest growth was in the postpaid segment (which also includes control), with a net addition of 9.4%. This category of services is the most important for operators, since the average monthly expense per user is usually significantly higher than for prepaid.

Despite the increase in lines and revenue, Vivo reduced the average monthly expense per user. On average, the operator’s customers pay R$ 27.8 per month with cellular services (-2.4%).

The operator ended the quarter with cellular coverage in 4,991 municipalities, of which 4,169 have 4G technology.

Vivo Fibra has a 39.2% growth in customers

Considering the entire fixed segment, Vivo ended the quarter with 15.17 million accesses, down 10.8% year-on-year. The negative disconnection balance represents old technology accesses, such as fixed voice, broadband with xDSL technology and pay TV via satellite.

The landscape changes when it comes to newer technologies. Vivo had a 7.4% increase in FTTx customers, which include accesses with optical fiber to the customer’s home (FTTH) and metallic pair (xDSL) from the former GVT.

Of the 5.43 million FTTx customers, about 4.35 million receive fiber optics indoors. This modality had an annual growth of 39.2%. The technology also allows pay TV via IPTV, and there are 918 thousand contracts for this service (+7.4%).

In the annual accumulated, Vivo highlights that it had more net additions of fiber in the first nine months of 2021 compared to the whole of last year. There are 978,000 new Vivo Fibra customers, who spend an average of R$90.2 per month on the broadband service.

Vivo wants fiber in 29 million addresses by 2024

During the presentation of results, Vivo disclosed that there was a 60% reduction in the costs of construction of the fiber optic network. In 2019, the operator spent BRL 400 for each covered household (home passed); the figure dropped to R$160 in the third quarter of 2021.

Live Fiber
Vivo Fiber (Image: Lucas Braga / Tecnoblog)

With the cost reduction, Vivo revised its fiber optic network growth target by 20%, without increasing the amount for investments. If the proposal is fulfilled, the Vivo Fibra service should be available for contracting in 29 million Brazilian addresses by the end of 2024.

The goal includes expansions by Vivo itself and by neutral networks, such as Fibrasil. With this, Vivo should be closer to Oi: the neutral company V.tal, used by the competitor, plans to offer optical fiber to 32 million homes by the end of 2025.

Anyway, the revised numbers are still insufficient to reach Claro. The leader in the fixed internet sector has a network that reaches 34.3 million homes with coaxial cable technology, in addition to 2.8 million with pure optical fiber.

Currently, Vivo Fibra’s coverage reaches 18.3 million homes in 309 Brazilian cities. The operator is the leader in the FTTH segment, while Oi ranks 2nd with around 14.5% of the market.

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