Vasta Platform Limited Q2 FY2025 earnings call

Growth in Core and Complementary Solutions

• Second quarter 2025 total net revenue up 21.8% to BRL 358 million; subscription revenue up 15% to BRL 320 million; non-subscription revenue up 98% to BRL 29 million.

Free Cash Flow Strength

• Second quarter 2025 free cash flow BRL 80 million, a 108% increase y-o-y. 2025 sales cycle to date free cash flow BRL 224 million, a 147% increase y-o-y.

Start-Anglo Bilingual School Expansion

• Implemented 5 new operating units in 2025, with 7 units in operation; over 50 contracts signed, expecting 8 new units in 2026.

Innovation Efforts

• Introducing AI tools for personalized learning and individualized education plans (IEP) to support inclusive practice.

In the second quarter of 2025, total net revenue increased by 21.8% to BRL 358 million. Subscription revenue was BRL 320 million in Q2 2025, a 15% increase compared to Q2 2024. Non-subscription revenue jumped 98% to BRL 29 million in Q2 2025 due to seasonal delivery of books. For the 2025 sales cycle to date, subscription revenue reached BRL 1.340 billion, a 16% increase y-o-y, contributing 90% of total revenue. Non-subscription revenue was BRL 98 million, a 11% increase y-o-y. The Government (B2G) segment had Q2 2025 revenue of BRL 9 million, with year-to-date new customers totaling BRL 14 million. The 2025 sales cycle to date net revenue was BRL 1.488 billion, a 14% increase compared to the same period in 2024.

Commercial Cycle Outlook

• Positive outlook for complementary products with over 20% growth in 2025 and expected continuation. Expect at least 1 new state in B2G by year-end.

Start-Anglo Timeline

• Expect 8 new operating units for Start-Anglo in 2026, with remaining units in 2027-2028.

EBITDA Margin Expectation

• Anticipate Q4 2025 EBITDA margins slightly above 30% due to growth and positive revenue recognition trends.

• Credit scenario challenges: Provisions for doubtful accounts still foresee difficulty, especially for school-related mainstream brands.
• Competitive Environment: Market is competitive, but the company is advancing with its strong portfolio.

Q: Comment on the commercial cycle, competitive environment, core vs complementary, and B2G outlook during election year.

A: The commercial cycle for 2026 is positive with strong demand for complementary products. Market is competitive but the company is progressing. B2G has 10 new customers year-to-date, with expectations of at least 1 new state by year-end.

Q: Discuss EBITDA margin, provisioning levels, and B2G second half outlook.

A: EBITDA margin helped by premium products and growth; provisioning expected to continue improving. B2G second half has Pará second semester orders and new municipalities, with positive growth outlook.

Q: Inquire about Start-Anglo contract operations and non-subscription revenue drivers.

A: Over 50 new contracts for Start-Anglo; expect 8 new units in 2026. Non-subscription revenue driven by tuitions from flagship schools and growth in Anglo prep courses.