TIM SA Q1 FY2025 earnings call

• Mobile revenues grew 6.2% y-o-y led by post-pay growth. EBITDA grew 6.7% y-o-y with margin expansion. - Operational leakage flow saw double-digit expansion to R1 billion. - Launched updated Meu TIM app with user growth. - Boosting Sao Paolo presence via 360° customer experience, network modernization, and go-to-market revamp. - B2B utilities vertical focused with new partnerships. - Service revenues grew 5.6% y-o-y. - Postpaid segment had ~14% y-o-y growth, driving revenue dynamics. - Network modernization in Sao Paolo led to 40% coverage/capacity increase and 15% energy consumption reduction. - Digital ecosystem expanded with new energy sector initiatives, e.g., pilot with Electrobras and Toppen.

Mobile revenues increased by 6.2% year-over-year, driven by strong post-pay growth. EBITDA grew by 6.7% yearly with margin expansion. Service revenues started the year at a solid pace, growing 5.6% year-over-year. The postpaid segment was the main driver, with close to 14% yearly growth. Mobile ARPU improved due to effective customer monetization strategies. B2B IoT initiatives showed substantial growth in contracted revenues, particularly in agribusiness, logistics, and utilities. The digital ecosystem continued to expand with growth in customer registrations and transaction volumes. Mobile revenues contribution: ~70% from postpaid lines, which make up 50% of the base.

• Committed to meeting annual guidance. - Postpaid to be main growth engine for mobile service revenue in coming quarters. - Aim to slow down the decrease in prepaid segment going forward.

• Volatile external environment. - Prepaid segment facing challenges due to market trends (e.g., migration to postpaid and market demand constraints). - Lease payments impacted by inflation, with focus on mitigating via renegotiations, decommissioning, and partnerships. - Competitive pressure from new and regional operators like Resonet.

Q: Related to mobile growth, prepaid performance and cost levers.

A: Alberto noted postpaid is main growth driver, prepaid suffering with a plan of offer, communication, and channel tactics; Andrea discussed cost efficiency program and lease mitigation initiatives.

Q: On mobile growth, postpaid price increases and future trends.

A: Alberto explained postpaid growth drivers including price adjustment, migration, and future slowdown in growth; Marcelo clarified on price increase timing and future dynamics.

Q: Follow-up on ARPU, revenue guidance.

A: Alberto said ARPU has growth drivers and dilutive factors, committed to annual guidance with postpaid as main growth engine.

Q: On leasing payments and working capital.

A: Andrea discussed lease payment management via negotiation, decommissioning, and partnerships; on working capital, seasonality and ongoing initiatives.

Q: On pricing dynamics and TIM Live.

A: Alberto said front book price upgrades coming; on TIM Live, market competition, copper fade, and inorganic assessment for the business.