A.History and Development of the Company
General
We were incorporated on May 22, 1998, as a corporation (sociedade anônima) organized under the laws of the Federative Republic of Brazil, as a result of the restructuring and privatization of Telecomunicações Brasileiras S.A. and its operating subsidiaries, or Telebrás, which monopolized the provision of public telecommunications services in virtually all areas of Brazil prior to 1998. We were incorporated under the name Telesp Participações S.A. and after subsequent reorganizations, we were named Telecomunicações de São Paulo S.A. – TELESP. After our merger with Vivo Participações in October 2011, we changed our corporate name to Telefônica Brasil S.A.
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On September 18, 2014, we entered into a stock purchase agreement with Vivendi S.A. to acquire all of the shares of GVT Participações S.A., or GVT, the controlling shareholder of Global Village Telecom S.A., or Operating GVT, which was approved by our board of directors on the same date. Pursuant to Brazilian law, the transaction required approval by both ANATEL and CADE. On December 22, 2014, ANATEL approved the transaction and imposed certain obligations, that included (1) the maintenance of current GVT services and plans within the same geographic scope in which GVT previously operated, requiring, in addition, that the successor company expand its operations to at least ten new municipalities within three years beginning on January 26, 2015; and (2) the waiver of the STFC license held by GVT within 18 months of ANATEL’s decisions, since the same economic group cannot hold more than one STFC license in the same geographic area. Telefônica has satisfied both obligations. On March 25, 2015, CADE provisionally approved the GVT acquisition, subject to a series of obligations imposed to prevent any undesired concentration effects of the merger. Such obligations require that we:
•Maintain, for at least three years, the current geographical coverage for STFC, SCM and SeAC services;
•Maintain, for at least three years, the current average broadband speed for GVT’s customers on a nationwide basis. The reference as of December 2014 was 15.1 Mbps;
•Maintain, for at least three years, the current average broadband speed for GVT’s customers in São Paulo. The reference as of December 2014 was 18.25 Mbps; and
•Do not exchange, directly or indirectly, classified information, strategic or competitively sensitive information with any other company or between management and representative responsible for subsidiaries of Vivendi group, the Telefónica group and the Telecom Italia group related to its operations in the Brazilian market.
In November 2015, ANATEL consented to our corporate reorganization involving Telefônica Brasil S.A., GVT Participações S.A. and its subsidiaries. The approval was subject to certain conditions such as the end of overlap licenses of STFC, SCM and SeAC within 18 months and the obligation to present a list of all assets from the companies incorporated in our STFC (Sector 31, Region III) concession area, confirming the absence of reversible assets burdened judicially (by means of a negative certificate), or in case of attachment, present the appropriate requests for replacement. On March 14, 2016, the corporate reorganization was approved by our board of directors and was completed on April 1, 2016, after the approval by an extraordinary shareholders' meeting of the relevant companies.
On July 3, 2017, Telefônica Data S.A., or TData, a wholly-owned subsidiary of the Company, acquired all the shares of capital stock of Terra Networks Brasil Ltda., or Terra, from SP Telecom, one of the controlling shareholders of the Company. The purpose of the Terra Networks Transaction was to expand and integrate our offering of digital services, in order to provide additional value to our customer base and TData’s. Effective as from December 1, 2018, TData was merged into the Company as part of a corporate restructuring. See “—Historical Background—Restructuring Involving TData” for more information.
In March 2020, the Company expressed interest in acquiring, jointly with TIM S.A. and Claro S.A., part of the UPI mobile assets of Oi S.A., an acquisition that would reach its closing on April 20, 2022. On that date, all the shares of Garliava RJ Infraestrutura e Redes de Telecomunicações S.A. were acquired by the Company.
We are registered with the CVM as a publicly held company and our stock is traded on the B3 under the ticker “VIVT3”. We are also registered with the SEC in the United States and our ADSs are traded on the NYSE under the ticker “VIV” (formerly “TSP”). Our headquarters are located at Avenida Engenheiro Luis Carlos Berrini, 1376, 04571-936, São Paulo, SP, Brazil. Our e-mail is [email protected] and our website is https://ri.telefonica.com.br/en. The information on our website is not included or incorporated by reference in this annual report on Form 20-F.
As of December 31, 2025, we had 3,195,606,352 outstanding common shares (excluding treasury shares), with no par value per share. As of December 31, 2025, our shareholders’ equity amounted to R$69.0 billion as presented in our audited consolidated financial statements included elsewhere in this annual report.
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Historical Background
Corporate Restructuring Involving the Company and Vivo Participações
On July 28, 2010, our parent company, Telefónica, reached an initial agreement with Portugal Telecom for the acquisition of 50% of the share capital of Brasilcel, N.V., or Brasilcel. As a result of this transaction, Telefónica held 100% of Brasilcel’s share capital. At the time, Brasilcel held approximately 60% of Vivo Participações’ share capital. On December 21, 2010, Brasilcel was incorporated into Telefónica.
Due to the acquisition of control of Vivo Participações, on February 16, 2011, Telefónica, through its subsidiary SP Telecom, launched a public offer for the common shares of Vivo Participações (its only voting shares) held by minority shareholders. As a result of the public offer, on March 18, 2011, SP Telecom acquired 10,634,722 common shares of Vivo Participações, representing 2.66% of its shares, resulting in the Telefónica group’s participation of 62.1% of Vivo Participações.
On December 27, 2010, the boards of Directors of Vivo Participações and Telefônica Brasil approved the terms and conditions of a corporate restructuring, which provided for the merger of the shares issued by Vivo Participações in Telefônica Brasil. The corporate restructuring was approved by ANATEL on March 24, 2011, and on April 27, 2011, the shareholders of Vivo Participações and Telefônica Brasil approved the merger of the shares issued by Vivo Participações in Telefónica. On June 14, 2011, the board of directors of both companies approved a second corporate restructuring, in which Vivo Participações became our wholly-owned subsidiary. The terms and conditions of the second corporate restructuring were unanimously approved by the shareholders of both companies on October 3, 2011. Vivo Participações was incorporated into us, and the holders of Vivo Participações’ merged shares received new shares of the company.
Due to the merger of Vivo Participações into us, our capital was increased by R$31.2 billion, reflecting the economic value of the shares issued as a result of the merger. The merger did not change the identity of the controlling shareholders of the companies.
In addition, as a result of this merger, on July 6, 2011, Vivo Participações submitted a statement to the SEC to cancel the registration of its American Depositary Shares, or ADS, program, since all its ADSs were converted into ADSs of Telefônica Brasil. The SEC approved the deregistration on July 7, 2011.
A third stage of the corporate restructuring was approved by ANATEL on August 16, 2011. On October 3, 2011, our shareholders approved the merger of Vivo Participações in the USA and Telefônica Brasil absorbed the assets of Vivo Participações, extinguishing Vivo Participações, which simplified and further rationalized our cost structures. On the same date, we changed our telecommunications name from Telecomunicações de São Paulo S.A. – TELESP to Telefônica Brasil S.A., to reflect our national operations. On October 18, 2011, ANATEL approved the transfer of the authorization for the provision of SMP services in the state of Minas Gerais from Vivo Participações to Vivo.
As a result of this name change, the ticker symbols for our shares were also changed from October 6, 2011 (including), from TLPP3, for common shares, and TLPP4, for preferred shares, to VIVT3 and VIVT4, respectively, with the subsequent change of our trading name to TELEF BRASIL. Our ticker symbol for ADRs on the NYSE was changed to VIV, from TSP.
Acquisition of GVT
On September 18, 2014, we signed a share purchase agreement with Vivendi and some of its subsidiaries, or collectively, Vivendi, and with GVTPar, Telefónica, S.A. and GVT Operacional, under which we agreed to buy all shares of GVTPar, the controlling shareholder of GVT. This acquisition was approved by our board of directors on September 18, 2014.
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As consideration for the acquisition, we agreed to pay a portion of the price in cash, and a portion in the form of our common and preferred shares, as follows: (1) €4,663,000,000 to be paid in cash on the closing date, as adjusted under the terms of the share purchase agreement, and (2) our common and preferred shares in the amount of 12% of our total capital after the capital increase contemplated in the share purchase agreement and the merger of GVTPar shares in us. The full consideration was paid upon completion of (A) a capital increase, the proceeds of which were used to pay the cash consideration described in (1) above, and (B) the merger of GVTPar shares in us.
On December 22, 2014, ANATEL approved the transaction and imposed certain obligations, which we believe did not compromise the terms of the acquisition of GVT or its value. On March 25, 2015, CADE’s administrative court approved the transaction on the basis of certain confidential commitments offered by us and Vivendi S.A. Commitments include the execution of two merger control agreements: the first between CADE and the second between CADE and Vivendi S.A.
On March 25, 2015, our board of directors approved the public offering of shares, including shares in the form of ADSs, in accordance with a capital increase of R$15,812,000,038.03, by issuing 121,711,240 common shares, at the price of R$38.47 and 236,803,588 preferred shares, at the price of R$47.00, as well as 6,282,660 preferred shares according to the exercise of the excessive allotment option. On May 28, 2015, our shareholders approved the ratification of the Share Purchase Agreement and Other Agreements, signed by the Company, as Buyer, and Vivendi S.A. and its subsidiaries, Société d’Investissements et de Gestion 108 SAS and Société d’Investissements et de Gestion 72 S.A., as Sellers, for which all shares issued by GVTPar, a shareholder of Global Village Telecom S.A., were acquired by us.
Therefore, as provided for in the share purchase agreement, we paid a portion of GVT’s spot acquisition price with cash, receiving shares of GVTPar and GVT Operator, and another portion in shares, to FrHolding108 as a result of the merger of GVTPar’s shares in us, representing 12% of our share capital after the merger.
On June 24, 2015, the transaction for the exchange of shares between Telefónica and Société d’Investissements et de Gestion 108 SAS, a company controlled by Vivendi S.A. was completed, through which FrHolding108 transferred to Telefónica 76,656,559 shares representing 4.5% of our share capital, including 68,597,306 common shares representing 12% of this class of shares and 8,059,253 preferred shares representing 0.72% of this class of shares, in exchange for 1,110,000,000 shares representing 8.2% of the common shares of Telecom Italia, S.p.A., previously held by Telco TE, S.p.A., a subsidiary of Telefónica.
On July 29, 2015, Vivendi S.A. sold 67.9 million preferred shares, representing 4% of our share capital. On the same day, Telefónica S.A. announced that it had signed an agreement with Vivendi’s subsidiary, Société d’Investissements et de Gestion 108 SAS, through which Telefónica undertook to deliver 46.0 million of its treasury shares, representing 0.95% of its share capital, in exchange for 58.4 million preferred shares of Telefônica Brasil S.A., (received by Société d’Investissements et de Gestion 108 SAS. in the context of the acquisition of GVT Participações, S.A.). On September 16, 2015, the stock exchange was completed. Consequently, Telefónica S.A.’s interest in the Company increased 5.2% in relation to the total preferred shares of the Company and 3.5% in relation to the company’s total capital. On the other hand, SIG108’s shareholding in the Company was reduced by the same proportion. Therefore, as of that date, SIG108 has no interest in the Company.
On March 14, 2016, our board of directors approved a corporate restructuring to simplify our organizational structure. In the previous corporate structure, GVT Participações S.A. (“GVTPart”) was 100% owned by Telefônica Brasil. On the date of the merger, GVT was divided and its net assets were transferred in part to GVTPart and partly to POP. GVT’s share of equity related to assets, rights and obligations related to telecommunications activities was transferred to GVTPart and other installments, related to assets, rights and obligations related to other non-telecommunications activities, were transferred to POP. GVTPart was later merged into Telefônica Brasil. The corporate restructuring did not result in an increase in capital or a change in the company’s shareholders’ participation and was ratified by an extraordinary general meeting on April 1, 2016.
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Acquisition of Telefônica Transporte e Logística Ltda. by TData
On October 28, 2015, TData, as a buyer, and Telefónica Gestión de Servicios Compartidos España S.A., as a seller, signed a Share Purchase agreement that resulted in the acquisition of Telefónica Transporte e Logística Ltda., a Brazilian-based company that, among other activities, provides logistics services.
Acquisition of Terra by TData
On July 3, 2017, we announced that our wholly-owned subsidiary, TData, acquired all shares in the share capital of Terra Networks Brasil S.A. (“Terra”) from SP Telecom, one of our controlling shareholders (the “Transaction”). Terra is a provider of digital services (own and third-party services of value added (“VAS”) and carrier billing, as well as mobile channels for sales and relationships) and advertising. The goal of the Transaction was to expand and integrate our digital services offering in order to provide additional value to our customer base and TData’s, as well as to provide TData’s service offering to Terra’s customer base and subscribers. In addition, the Transaction aimed to expand TData’s advertising business as a result of Terra’s national operations and expertise. The total price paid by TData as a counterpart for the acquisition of shares issued by Terra was R$ 250 million, paid in a single installment using TData’s cash in hand, without the need for financing. The Transaction was not subject to any regulatory authorizations or approvals by us and was completed on July 3, 2017.
Restructuring Involving TData
On October 30, 2018, our board of directors approved the terms and conditions of the merger in the Company of its wholly-owned subsidiary TData, as well as the proposal to convene the Company’s extraordinary general meeting for November 30, 2018, to resolve the merger. The merger aimed to standardize the provision of services, as well as simplify the company’s organizational and corporate structure, being approved by the Company’s Extraordinary Shareholders’ Meeting on November 30, 2018, not resulting in an increase in capital or change in the Company’s shareholders’ equity. The merger was completed with operational effect as of December 1, 2018.
Restructuring involving Terra and Telefônica Infraestrutura e Segurança Ltda.
On September 26, 2019, we announced that our wholly-owned subsidiary, Terra had acquired all shares of Telefónica Infraestrutura e Segurança Ltda., or TIS, Telefónica Ingeniería de Seguridad S.A. and Telefónica Digital España S.L.U. (the “TIS Transaction”). TIS is dedicated to the exploration and provision of services and technology of information security systems, technical support and other services related to infrastructure, technology and information.
The objective of the TIS Transaction was to enable Terra, which carries out, among other activities, the development of computer systems, with the objective of expanding consulting and operational assistance, maximizing the commercialization of systems, licenses and applications, enabling the expansion of the portfolio of professional and managed services and the integration of commercial offerings from TIS and Terra, unlocking the generation of added value for the Company’s portfolio of clients such as information technology, security, IoT (Internet of Things) and connectivity activities, all to be provided under common management.
The total amount paid for the acquisition of the shares issued by TIS was R$70.84 million, in a single installment, without any financing, using the cash available from Terra. This value was calculated based on the economic value of TIS as of June 30, 2019, according to the cash flow criterion, supported by an evaluation report commissioned by us.
The TIS Transaction did not alter our ownership structure or cause any dilution to our shareholders.
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Launch of Vivo Money Credit Rights Investment Funds (FIDCs)
In August 2020, in relation to the launch of our Vivo Money service, we structured a credit rights investment fund, Vivo Money Fundo de Investimento em Direitos Creditórios (the “FIDC”), which was created in the form of a closed company for an indefinite period. FIDC’s objective is to provide its quotaholders with a return on equity on their quotas by investing in the acquisition of (i) eligible credit rights, with supporting documents that meet the eligibility criteria and the conditions of assignment, and (ii) financial assets, observing all the composition and diversification indices of the fund’s portfolio. Eligible credit rights to be acquired by FIDC originate from credit transactions conducted electronically by our customers exclusively through our Vivo Money electronic platform. FIDC began operations on September 14, 2020, issuing 2,000 junior subordinated quotas with an initial unit value of R$1,000. On December 1, 2020, we made a new contribution to FIDC in the amount of R$2 million, with the issuance of over 2,000 junior subordinated quotas with an initial unit value of R$1,000. In 2021 we made a total of nine contributions to the FIDC that totaled R$30 million, totaling 26,009.82 junior subordinated quotas with an initial unit nominal value of R$1,260 which will not have a defined remuneration parameter and are subordinated to senior quotas and subordinated quotas, in this order of priority, for the purpose of amortization and redemption. Residual returns from this FIDC, if any, are paid to us as subordinated shareholders. In 2022 we made 11 contributions to the Vivo Money FIDC, in the total amount of R$137 million, representing 126,340.74 junior subordinated quotas with an initial unit nominal value of R$1,435.
On July 31, 2023, we signed an investment commitment in Vivo Money FIDC with Polígono Capital (“Polígono”). Polígono is an independent asset manager founded in February 2023 as a partnership between BTG Pactual Asset Management and Prisma Capital to operate in Brazil’s credit-as-a-service market. Its activities range from contract management and credit policy implementation to portfolio management and debt collection. In 2023, Polígono contributed a total of R$30.0 million to the Vivo Money product. These contributions to Vivo Money’s existing funds (“FIDC I” and “FIDC II” were recognized as financial liabilities. In the same year, Telefônica Brasil S.A. contributed R$42.0 million. For the year ended December 31, 2024, Polígono’s total contributions to Vivo Money amounted to R$38.1 million, while Telefônica Brasil contributed R$0.8 million. For more information, see note 21.c.3.5 to our audited consolidated financial statements included elsewhere in this annual report.
On October 11, 2024, FIDC II ceased to exist as it was merged into FIDC I, which operates on personal loans, payroll-deducted loans, FGTS, and Pix installments transferred from the liquidated fund (VIVO PAY II - Pix Installment). Subsequently, on April 29, 2024, “FIDC III” was created to operate the “Parcela Pix” product, with a single investment from Telefônica Brasil of up to R$10.0 million. This fund was terminated on November 6, 2025.
On March 11, 2025, at a unitholders’ meeting, the fund’s corporate name was changed from VIVO MONEY III Fundo de Investimento em Direitos Creditórios – Responsabilidade Limitada (FIDC III) to VIVO PAY II Fundo de Investimento em Direitos Creditórios – Responsabilidade Limitada (VIVO PAY II), and the designation of the unit class was amended accordingly to reflect the new name. At the same meeting, unitholders approved the second issuance of junior subordinated units, in a total amount of up to R$ 1,000,000.00, pursuant to the terms and conditions set forth in the applicable supplement.
On April 4, 2025, Telefônica Brasil made an additional capital contribution of R$ 0.25 million. Subsequently, the unit holders approved the early liquidation of the fund on August 28, 2025, which was thereafter completed. On November 7, 2025, VIVO PAY III – Fundo de Investimento em Direitos Creditórios, Responsabilidade Limitada (VIVO PAY III) was established with an indefinite term, in accordance with CMN Resolution No. 2,907 of November 29, 2001, CVM Resolution No. 175 of December 23, 2022, as well as other applicable legal and regulatory provisions. This fund has a single class of units, structured as a closed-end class, with limited liability and indefinite duration, governed by CMN Resolution 2,907/01, Annex II of CVM Resolution 175/22, and other relevant regulations.
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Pursuant to its bylaws, this fund constitutes a pool of resources primarily intended for the acquisition of credit rights and other financial assets, as described in its descriptive annex, in compliance with the investment policy applicable to the class and its specific characteristics. The administrator and the manager approved the issuance of junior subordinated units, through a private placement, up to the total amount of R$ 10.0 million, by means of the subscription of up to 10,000 units, each with a unit value of R$ 1,000.00. The initial contribution made to the fund amounted to R$ 2.0 million.
Conversion of Our Preferred Shares into Common Shares
At an extraordinary shareholders’ meeting held on October 1, 2020, our shareholders approved, effective as of such date, among other things: (1) the conversion of all of our preferred shares into common shares, at a ratio of one common share for each preferred share, or the “Conversion”; and (2) certain amendments to our by-laws. At a special meeting of holders of our preferred shares, held on that same date, our preferred shareholders ratified the Conversion. After the Conversion, which formally occurred after the market closed on November 20, 2020, our ADRs backed by preferred shares were exchanged for ADRs backed by common shares, and our subscribed and fully-paid share capital was R$63,571,415,865.09 divided into 1,690,984,923 common shares, all with no par value. All of our common shares continued to trade under the ticker symbol “VIVT3” on the B3 (while our ticker symbol “VIVT4,” under which our preferred shares traded on the B3, was suspended on November 23, 2020), and our ADRs backed by common shares began trading on the NYSE under the ticker symbol “VIV.”
Restructuring involving the sale of shares of Telefônica Cibersegurança e Tecnologia do Brasil Ltda. to Telefónica Cybersecurity Tech, S.L.
On November 1, 2020, our board of directors approved the execution of a quotas purchase and sale agreement, or the “CyberCo Transaction,” pursuant to which we sold a 100% equity interest in our subsidiary Telefônica Cibersegurança e Tecnologia do Brasil Ltda., or CyberCo Brasil, to Telefónica Cybersecurity Tech, S.L., or TTech, an indirect subsidiary of Telefónica, for the total amount of R$116.4 million, supported by an appraisal report commissioned by us.
As a preliminary step to the implementation of the CyberCo Transaction, certain assets, contracts, and employees were transferred to CyberCo Brasil, all strictly related to cybersecurity activities. The transaction allowed us, as an exclusive distributor of CyberCo Brasil, to be positioned in the cybersecurity market by expanding our portfolio of products and services. In addition, we benefit from greater competitiveness due to the global scale of our cybersecurity partner.
The transaction did not alter our shareholding structure, nor cause any dilution to our shareholders. The CyberCo Transaction was not subject to any regulatory authorizations or other approvals in addition to those obtained from our governance bodies on October 30, 2020 and November 1, 2020.
Corporate Reorganization – CyberCo Repurchased by Telefônica Brasil S.A.
On December 9, 2025, Telefônica entered into a quota purchase and sale agreement, pursuant to which Telefônica Infraestrutura e Segurança Ltda. (“TIS”), an indirect wholly owned subsidiary of Telefônica, acquired 100% of the equity interest in Telefônica Cibersegurança e Tecnologia do Brasil Ltda. (“CyberCo Brasil”) from Telefónica Cybersecurity & Cloud Tech, S.L. (“TTech”), a company under common control with the Company.
All quotas issued by CyberCo Brasil were sold by TTech for a total amount of up to R$ 232 million, with R$ 212 million paid in a single installment on the signing date and up to R$ 20 million as contingent consideration.
As a result of the transaction, Telefônica, through TIS, became the indirect owner of 100% of the share capital of CyberCo Brasil. This movement reinforces the Company’s strategic focus on the B2B market, enabling greater integration of its digital, cloud and cybersecurity offerings, optimization of service delivery, acceleration of new product launches and strengthening of commercial execution, while preserving full operational and governance control over its cybersecurity platform in Brazil.
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Investment by Telefónica Infra, S.L.U. and Caisse de Dépôt et Placement du Québec in FiBrasil Infraestrutura e Fibra Ótica S.A.
On July 2, 2021, we executed certain agreements, or the “FiBrasil Transaction,” with Caisse de Dépôt et Placement du Québec, or “CDPQ,” a global investment group, and Telefónica Infra, S.L.U., or "TEF Infra," a wholly-owned Spanish subsidiary of Telefónica, for the construction, development and operation of a neutral and independent optical fiber wholesale network in the Brazilian market, through FiBrasil Infraestrutura e Fibra Ótica S.A., or “FiBrasil”. The operation represented a total investment by CDPQ of up to R$1.8 billion (including payments to us and contributions to FiBrasil) in exchange for a 50% equity interest in FiBrasil’s share capital. TEF Infra acquired a 25% equity interest for the same price, while we held the remaining 25% interest. CDPQ had committed to make additional contributions of approximately R$750 million, of which R$205 million had been paid on closing of the FiBrasil Transaction. These contributions, as well as debt that had been raised (such as FiBrasil’s R$550 million debentures issuance on September 25, 2021), were expected to finance the totality of its business plan.
Acquisition of Caisse de Dépôt et Placement du Québec’s Equity Interest in FiBrasil by Telefônica Brasil S.A.
On July 10, 2025, Telefônica Brasil S.A. announced that it had entered into an agreement to acquire the entire equity interest held by Caisse de Dépôt et Placement du Québec (“CDPQ”) and Fibre Brasil Participações S.A. ("Fibre") in FiBrasil Infraestrutura e Fibra Óptica S.A., representing 50% of FiBrasil’s total share capital, as well as the subscription warrants previously issued by FiBrasil. At this initial stage, the transaction remained subject to customary conditions precedent and to the receipt of all required regulatory approvals, as stipulated under applicable regulations.
Following the completion of all required steps, including review and approval by the relevant regulatory authorities, confirmation of the fulfillment of contractual conditions, and the completion of the applicable corporate procedures, the transaction was finalized on November 12, 2025. Upon closing, Telefônica Brasil increased its ownership in FiBrasil to 75.01% of its total share capital, while Telefónica Infra, S.L.U. remained a shareholder holding the remaining 24.99%.
Additionally, the subscription warrants previously issued by FiBrasil were canceled immediately after closing. The final acquisition price, adjusted by the positive variation of the CDI rate, amounted to R$ 858 million. The increased ownership further strengthens the Company’s strategic commitment to expanding neutral fiber‑optic infrastructure in Brazil and reinforces FiBrasil’s position as an independent and competitive wholesale fiber platform.
On January 9, 2026, the Company’s General Shareholder’s Meeting, ratified the acquisition, pursuant to the first paragraph of article 256 of the Brasilian Corporations Law. Furthermore, Pursuant to Articles 256, §2, 136, item VI, and 137 of the Brazilian Corporations Law, shareholders of the Company who dissent from the resolutions approving the ratification of the acquisition shall be assured the right to withdraw from the Company upon reimbursement of the value of the shares of which they are proven holders.
Sale of shares of Telefônica Cloud e Tecnologia do Brasil S/A to Telefónica Cybersecurity & Cloud Tech, S.L.
On August 2, 2021, our board of directors approved the execution of a share purchase and investment agreement, or the “TC&T Transaction, whereby: (i) we sold 20% of our stake in our subsidiary Telefônica Cloud e Tecnologia do Brasil S.A., or CloudCo Brasil, to Telefónica Cybersecurity & Cloud Tech, S.L., or TC&CT, a company indirectly controlled by Telefónica, for R$22.0 million; and (ii) TC&CT acquired 190,000 common shares, without par value, issued by CloudCo Brasil, for a total issuance price of R$76.0 million, of which R$25.0 million was paid on August 2, 2021, and R$51.0 million paid in two installments in January 2022 and 2023. These prices were based on an appraisal report prepared by a specialized, independent appraiser. As a result of the TC&T Transaction, after the transaction, we came to hold 50.01% of CloudCo Brasil’s share capital, while TC&CT came to hold the remaining 49.99% interest. Our relationship with TC&CT with respect to the management of CloudCo Brasil is governed by a shareholders’ agreement, which was also executed on August 2, 2021, as amended. Both the share purchase agreement and the shareholders’ agreement have terms and conditions that are common to this type of transaction.
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As a preliminary step in the implementation of the TC&T Transaction, certain assets, contracts and employees have been transferred from us and TIS to CloudCo Brasil, all strictly related to cloud computing activities. The TC&T Transaction enabled us, in partnership with TC&CT, to develop a Brazilian company dedicated to cloud computing solutions and services for the B2B segment, improving our market position and product offerings and enabling us to capture significant growth opportunities in this sector. The TC&T Transaction was not subject to any regulatory authorizations or additional approvals, other than those already obtained from our governing bodies, and it did not change our capital structure, nor cause any dilution to our shareholders.
Launch of VivaE Joint Venture
Following our strategy of expanding our consumer digital services portfolio, we signed in October 2021 a non-binding memorandum of understanding with Ânima Holding S.A. (“Ânima Educação”), to set up a joint venture (“JV” or “VivaE”) in education services. In February 2022, we and Ânima Educação signed an investment agreement for the constitution of the aforementioned JV. Ânima Educação is one of the largest and most innovative ecosystems of private education in Brazil, with an 18-year track record. The JV was investing in an online education platform, which will provide professional learning courses and connect students with potential employers, initially in the areas of Technology, Management, Business, and Tourism. As of December 31, 2022, Telefônica Brasil and Ânima Educação collectively invested an aggregate amount of R$20 million in VivaE. In compliance with the investment targets under the JV, in March 2023, we and Ânima Educação each invested R$3 million in VivaE, totaling a cumulative aggregate investment in VivaE of R$26 million since the JV was formed up to December 31, 2023.
In line with the forecast for achieving investment targets, a new contribution of R$3.3 million was made by each shareholder (the Company and Ânima Educação) in December 2024, bringing the total aggregate investment in VivaE to R$33 million.
Corporate Reorganization – VivaE and Ada Tech Business Combination
On October 6, 2025, Telefônica Brasil S.A. (“Telefônica”) completed the corporate reorganization of its equity interest in Vivae Educação Digital S.A. (“Vivae”), a company jointly held with Ânima Holding S.A. The transaction consisted of the contribution of all Vivae shares held by Telefônica to the Vivo Ventures Private Equity Investment Fund, as partial payment in kind of the quotas previously subscribed by the Company in such fund.
Subsequently, in 2025, VivaE entered into a business combination agreement with Ada Tecnologia e Educação S.A. (“Ada”), a company specialized in educational solutions focused on programming and technology training for the B2B segment. The business combination aims to strengthen Vivae’s position in the professional digital education market, expand its portfolio of corporate solutions, and generate operational and commercial synergies.
As a result, Vivae became an indirect investment of Telefônica, held through the Vivo Ventures private equity fund, and now includes the strategic participation of Ada.
Sale of shares of Telefônica IoT, Big Data e Tecnologia do Brasil S/A to Telefónica IoT & Big Data Tech, S.A.
On November 1, 2021, our board of directors approved the execution of a share purchase and investment agreement, or the “TI&BDT Transaction,” whereby: (i) we sold a 0.02% equity interest in our subsidiary Telefônica IoT, Big Data e Tecnologia do Brasil S.A., or “IoTCo Brasil,” to Telefónica IoT & Big Data Tech, S.A., or “TI&BDT,” a company indirectly controlled by Telefónica, for R$19 million; and (ii) TI&BDT acquired 499,800 common shares, without value, of IoTCo Brasil, for a total issuance price of R$94.9 million. These prices were based on an appraisal report prepared by a specialized, independent appraiser. As a result of the TI&BDT Transaction, we own 50.01% of IoTCo Brasil’s share capital, while TI&BDT owns the remaining 49.99% interest.
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As a preliminary step to the implementation of the TI&BDT Transaction, certain assets, contracts, and employees were transferred from us and TIS to IoTCo Brasil, all of which are strictly related to IoT and big data activities. The TI&BDT Transaction enabled us, in partnership with TI&BDT, to develop a Brazilian company dedicated to IoT and big data services and B2B solutions, improving our market position and product offerings and enabling us to capture significant growth opportunities in this sector. Additionally, the TI&BDT Transaction also ensured that we continue to manage relationships with end customers, as we have also entered into an agreement whereby we will act as IoTCo Brasil’s exclusive sales channel.
The TI&BDT Transaction was not subject to any regulatory authorizations or additional approvals, other than those already obtained from our governing bodies, and it did not change our capital structure, nor cause any dilution to our shareholders.
Launch of Corporate Venture Capital Fund
As approved by the Company’s Board of Directors, on April 11, 2022, the Corporate Venture Capital fund was constituted, together with Telefonica Open Innovation, S.L., as Vivo Ventures Fundo de Investimento em Participações Multiestratégia or “Vivo Ventures” or “FIP”. Through Vivo Ventures, we intend to foster the expansion of our digital ecosystem with the creation of meaningful partnerships with startups, contributing to complementing the value proposition offered to our customers through innovative services and products, leveraging our extensive distribution chain and the potential of the Vivo brand.
Vivo Ventures has a total committed capital of R$ 470 million, which will be deployed in fifteen years, as investments in startups in the segments of healthcare, financial services, education, entertainment, smart homes, marketplace, among others. We hold 98% of the subscribed capital of Vivo Ventures and Telefónica Open Innovation holds 2%.
Vivo Ventures made its first investment in August 2022, investing the amount of US$3 million in Credit Vista Technologies Limited, the holding company of Credit Vista Tecnologia para Finanças Pessoais EIRELI (“Klavi”). Klavi is a fintech that offers Open Finance solutions through a SaaS platform (Software as a Service), using data intelligence that enables customers to develop financial products and services more quickly and accurately.
In December 2022, the FIP carried out its second operation, committing to invest R$10 million in Klubi Participações S.A. (“Klubi”). Klubi is a fintech authorized by the Central Bank to operate as a consortium administrator in Brazil, which currently offers car consortium products and services.
In May 2023, the FIP signed its third investment contract in the amount of US$3 million with DGB USA Inc., or Digibee, to acquire a stake in such company. Digibee is a company that provides a low-code iPaas (Integration Platform as a service) enabling simplified and efficient integration between legacy technological systems and new technologies, aligned with the Company's interest in accelerating the time-to-market of its technological development.
In May 2024, the FIP closed the acquisition of a shareholding position in the amount of R$25 million worth of stock in Conexa Health LLC, the controlling company of Conexa Saúde Serviços Médicos S.A. Conexa is the largest independent telemedicine platform in Latin America and a digital health ecosystem that connects patients, professionals, businesses, and insurers, using up-to-date technology, with the goal of levelling access to quality health care. Prior to the investment, Conexa announced a merger with Zenklub, a digital service company for emotional health and wellness.
In 2024, out of the total committed capital of R$320 million, the FIP received a new share subscription of R$100 million, with 98% subscribed by Telefônica Brasil S.A. and 2% by Telefonica Open Innovation, S.L. The subscribed amount will be disbursed as capital calls are made for new investments in startups.
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In July 2024, FIP committed to acquiring a minority equity stake in CRMBonus Holding in the amount of R$27.7 million. CRMBonus operates a platform that leverages artificial intelligence to enhance relationships between companies and their customers, promoting the concept of “giftback” in the Brazilian market. Since the beginning of this year, one of CRMBonus’ solutions, Vale Bonus, has been part of the benefits offered by the Company, rewarding customers with digital currency when they recharge or pay their bills on time, thereby contributing to increased customer retention.
In November 2024, the FIP acquired a minority stake in AGL Holding, the parent company of Agrolend Sociedade de Crédito Financiamento e Investimento S.A., or Agrolend, in the amount of R$9.0 million. Agrolend is an agricultural fintech that provides credit to small- and medium-sized rural producers in Brazil, financing the development of agricultural production and promoting investment in inputs, equipment, and technology to boost producer productivity and profitability. The fintech grants millions of Brazilian Reais in credit to farmers annually and has the potential to enhance the company’s product offerings for this audience by providing connectivity and solutions for better farm management.
In December 2024, Vivo Ventures made a follow-on investment of R$15 million in Klubi, a fintech authorized by the Central Bank of Brazil to operate as a consortium administrator. Klubi specializes in consortia for cars, cell phones, and electronic equipment. This additional investment strengthens Vivo’s presence in the financial solutions sector, complementing its existing services through Vivo Money. Vivo collaborated with Klubi to launch the Compra Programada product, a cell phone consortium offering tailored to meet customer needs. Vivo Ventures initially invested R$10 million in Klubi in December 2022.
In December 2024, Vivo Ventures entered into an agreement to consummate an investment via a simple agreement for future equity contract in Lend Holding Ltd., or Lend Tech, in the amount of R$18.2 million. Lend Tech is a financial services company that offers technology solutions for debt collection and uses credit and debit card receivables to execute collections. Closing of the transaction is expected in the first half of 2025 and is subject to customary closing conditions.
At the end of 2024, Vivo Ventures had capitalized R$137 million of the total of R$200 million in subscribed share capital, with R$53.9 million yet to be capitalized and R$120 million yet to be subscribed.
In 2025, Vivo Ventures made nine investments across strategic areas such as Fintech, Education, Insurtech and Legal, reinforcing its focus on digital platforms with strong potential for operational synergies, distribution leverage, and value creation within Vivo’s ecosystem.
In December 2024, Vivo Ventures entered into a commitment of US$2 million with Canary, a leading venture capital manager in Brazil, as part of its funds-of-funds strategy, with the objective of strengthening its presence within the venture capital ecosystem, enhancing long-term relationships with top-tier fund managers and expanding access to high-quality investment opportunities aligned with its strategic priorities.
In February 2025, Vivo Ventures completed an equity investment of R$11.6 million in Facio, a fintech specialized in credit origination and automation for financial institutions, offering end-to-end solutions that streamline underwriting, risk assessment and customer onboarding through technology and data-driven processes. The investment supports Facio’s expansion in the Brazilian credit market and aligns with Vivo’s strategy to strengthen its presence in financial services and digital lending solutions.
In July 2025, the FIP executed an initial investment of R$1.36 million in Elevify, an edtech focused on upskilling and professional development, offering digital education solutions aimed at improving employability and workforce qualification through scalable online programs. This investment aligns with Vivo Ventures’ interest in education platforms that leverage technology to democratize access to high-quality learning.
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In September 2025, Vivo Ventures committed R$35.0 million to AsaaS as part of a minority equity acquisition. AsaaS is a fintech that provides an integrated financial management and payments platform for small and medium-sized businesses, enabling billing, collections, payments and financial control through a single digital interface. The company supports SMEs in improving cash flow management and operational efficiency, strengthening Vivo’s positioning in solutions tailored to the SME segment.
In October 2025, the FIP acquired a minority stake of R$13.3 million in 180 Seguros, an insurtech that offers embedded insurance solutions through APIs, enabling companies to seamlessly integrate insurance products into their digital journeys. The platform focuses on modular and flexible insurance offerings that enhance customer experience and open new digital distribution channels, in line with Vivo Ventures’ strategy in embedded finance and digital protection solutions.
Also in October 2025, Vivo Ventures became a shareholder of Ada Tech through a corporate reorganization and merger involving Vivae — the edtech jointly created by Telefônica Brasil S.A. and Ânima Educação — and Ada Tech. As part of this transaction, the equity interest in Ada Tech previously held by Wayra, together with Telefônica Brasil’s stake in Vivae, was transferred to FIP Vivo Ventures, which now directly holds the participation and remains a shareholder of Ada Tech. Ada Tech is an education technology company focused on training and reskilling professionals in software development, data, artificial intelligence and other high-demand digital skills, combining online learning, hands-on projects, and corporate partnerships.
In December 2025, Vivo Ventures also carried out a follow-on investment of R$2.7 million in Facio, further reinforcing its confidence in the company’s execution and growth trajectory. The additional capital is intended to support product development, commercial expansion and the strengthening of its technology platform.
In December 2025, the FIP concluded an initial equity allocation of R$1.9 million in Inspira. Inspira is a legaltech that develops digital solutions to increase efficiency and automation in legal operations, supporting law firms and corporate legal departments with tools for process management, analytics and decision-making.
Finally, Vivo Ventures also approved an increase in the fund’s committed capital, raising its total size to R$470 million. As part of this expansion, the FIP received a new share subscription of R$150 million, with 98% subscribed by Telefônica Brasil S.A. and 2% by Telefonica Open Innovation, S.L. The subscribed amount will be disbursed through capital calls as new investment opportunities in startups are executed.
Acquisition of part of Oi UPI Mobile Assets (Business combination)
On April 20, 2022, the closing of the transaction related to the Purchase Agreement for Acquisition of Oi Group's mobile business operations (the “UPI Mobile Assets”) took place, and Telefônica Brasil acquired, on such date, all the shares of Garliava RJ Infraestrutura e Redes de Telecomunicações S.A. (“Garliava”), a special purpose company, to which the mobile assets of Oi Group assigned to Telefônica Brasil had been contributed, in accordance with the segregation plan stated in the Oi Agreement.
Thus, Telefônica Brasil acquired Garliava’s shares for the amount of R$5,373.0 million having paid, on such day, the amount of R$4,884.6 million. The remaining amount, equivalent to 10% of the payment made on that date, was withheld and its release was subject to certain ongoing discussions regarding price adjustments, as provided for in the Oi Agreement.
Likewise, on such date, Telefônica Brasil: (i) committed to an additional payment of R$110.2 million, subject to the fulfillment of certain targets by Oi, a contingent that was part of the total consideration; (ii) made a payment of termination costs in the amount of R$8.3 million, which was also part of the total consideration. Therefore, the total consideration at the closing date was R$5,491.6 million. The Company also entered into other complementary payment commitments with Oi, as follows: (i) made a payment of R$147.6 million for certain transition services provided by Oi to Garliava; and (ii) entered into a take-or-pay data transmission capacity agreement, with a net present value of R$179.0 million, to be paid monthly during a period of 10 years.
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In the context of this acquisition, the Company's share of UPI Mobile Assets was:
•Clients: approximately 12.5 million clients, or approximately 30% of UPI Mobile Assets’ total customer base as of February 2022, for which the allocation sought to enhance competition among the Brazilian telecom market operators;
•Spectrum: 43 MHz as a national weighted average based on population, or approximately 46% of the UPI Mobile Assets’ radio frequencies, with the allocation in strict conformity to the spectrum limits set by ANATEL; and
•Infrastructure: agreements for the use of approximately 2,700 mobile access sites, or approximately 19% of the UPI Mobile Assets’ total sites.
All commitments assumed were duly submitted to ANATEL and CADE during 2022.
Post-Closing Price Adjustment
On October 3, 2022, we commenced arbitration proceedings against Oi due to the manifest breach by Oi of certain terms of the Oi Agreement. These proceedings and related disputes between us and Oi were settled upon the execution of an agreement regarding the Post-Closing Price Adjustment (as defined in the Oi Agreement). This settlement was approved by the Market Arbitration Chamber on October 4, 2023. Pursuant to its terms, the final price for the UPI Mobile Assets assigned to us, taking into account the Post-Closing Price Adjustment, was of R$5,128.8 million, of which R$4,884.6 million was paid by us on April 20, 2022. The remaining amount was paid upon completion of the assessment to Oi of half of the Telefônica Retained Value, and we have withdrawn the other half of the Telefônica Retained Value that was deposited with the Market Arbitration Chamber, equal to R$244.2 million as of the closing date, plus interest and/or monetary correction.
Post-closing price adjustments occurred during the second half of 2023, after the PPA measurement period. Therefore, the impacts generated by post-closing price adjustments were recorded in the income statement, without changes to goodwill.
Merger of Garliava With and Into Telefônica Brasil
On February 1, 2023, our shareholders approved Garliava’s merger into Telefônica Brasil, subject to certain conditions. Fulfillment of these conditions was confirmed by our board of directors on February 28, 2023, from when the merger became effective and Garliava was declared extinct.
Acquisition of the Vita IT Company through TIS
On October 3, 2022, our indirect subsidiary, Telefônica Infraestrutura e Segurança Ltda. (“TIS”), completed the transaction for the acquisition of all shares representing the capital stock of Vita IT Comércio e Serviços de Soluções em TI Ltda. (“Vita IT”), was approved by CADE. The adjusted total purchase consideration transfer was R$110.2 million, of which: R$42.0 million, paid in cash at the time of completion of the Transaction; R$9.0 million paid in 2023 and the balance of R$59.2 million was paid according to contractual clauses, updated by the IPCA. The referred price was also supported by an appraisal report prepared by an independent company.
The transaction’s documents contain terms and provisions common to this type of transaction, such as representations and warranties, indemnification, and others. It was preceded by financial, administrative, legal, fiscal and operations diligence in relation to Vita IT.
The transaction was part of our strategy to strengthen our operations and positioning in the Networking market, with the supply of network equipment (e.g., switches, routers, and Wi-Fi access points) and implementation, management and technical support for the corporate network companies. Vita IT acted as a solution integrator for companies of different sizes, providing professional and managed Networking services, as well as reselling hardware and software in the same segment.
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The combination of resources and capacities of TIS and Vita IT generated added value for our client portfolio, thanks to the performance of both companies under the same management in Information Technology and Networking activities. The transaction also enabled new businesses to be leveraged on a larger scale and in a sustainable manner, in addition to enabling revenue growth and improving business margins. The integration plan between Vita IT, TIS and us was designed to preserve its value and give continuity to Vita IT’s business.
Merger of Vita IT Within and Into TIS
On November 30, 2023, our wholly-owned subsidiary TIS completed the merger of Vita IT, its wholly-owned subsidiary, with and into TIS. The “Vivo Vita” brand continue to exist and be used by TIS without affecting the activities previously performed by Vita IT. This merger strengthened the Company’s position in the networking market and allowed for greater operational efficiency, increased business scale, and standardization in providing certain information technology services.
Acquisition of the Vale Saúde Sempre Company through POP
On March 3, 2023, POP Internet Ltda. (“POP Internet”), a wholly-owned subsidiary of the Company, concluded the acquisition of all shares issued by Vale Saúde Administradora de Cartões Ltda. (f/k/a Vale Saúde Administradora de Cartões S.A.) (“Vale Saúde Sempre”) pursuant to the “Agreement for the Purchase and Sale of Shares and Other Covenants” (“Acquisition of Vale Saúde”). The total consideration transferred was R$62.0 million, with the payment as follows: R$37.0 million, paid in cash upon conclusion of the Transaction, R$3.0 million paid in 2023 and the balance of R$22.0 million will be paid according to contractual clauses, restated by the DI rate variation.
The consummation of the deal was not subject to prior approval by CADE and was also preceded by a financial, administrative, legal, fiscal, operational and technological diligence in relation to Vale Saúde.
Vale Saúde Sempre is a startup that acts as a healthcare services marketplace, connecting its customers to a wide medical-hospital network with national coverage, upon payment of a monthly subscription. Its accredited network has a full range of health service providers, and the customer can book medical consults (face-to-face and telemedicine), laboratory tests and surgeries at competitive prices, paid on demand directly to the partners.
The Acquisition of Vale Saúde strengthens the Company's positioning as a digital ecosystem, promoting services that are relevant and complementary to its business model. The differentiated assets of the Company, such as its brand, extensive customer base with high payment recurrence, and capillarity of on-site and digital distribution channels, will enable the sustainable scaling of Vale Saúde Sempre’s business in a sustainable manner, expanding the Company's portfolio to new digital services in the healthcare value chain.
GUD Comercializadora de Energia S.A. - Joint Venture with Auren Comercializadora de Energia Ltda.
On December 18, 2023, the Company and Auren Energia S.A., through its subsidiary Auren Comercializadora de Energia Ltda. (together, “Auren”), entered into an investment contract for the incorporation of a joint venture, of which each shareholder will hold 50%, (the “Auren Joint Venture”).
By combining Auren’s know-how in energy generation and commercialization with the Company’s scale, digital penetration and distribution capacity, the joint venture position itself in the free energy market in Brazil. Since January 2024, it is accessible to business customers connected to the high-voltage grid with demand below 500kW. The market for the joint venture is estimated to be over 72 thousand large companies including factories, offices and commercial establishments, in addition to, preparing future operations in the low-voltage and residential segments, in the event of the complete opening of the Brazilian electricity market.
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The transaction closed on March 15, 2024, with a contribution of R$10.3 million to establish the Auren Joint Venture. By December 2024, the Auren Joint Venture had obtained all necessary licenses and authorizations from the applicable regulatory agencies to develop its business.
Acquisition of IPNET Serviços em Nuvem e Desenvolvimento de Sistemas Ltda. and IPNET USA, LLC through Telefônica Cloud e Tecnologia do Brasil S.A.
On July 22, 2024, Telefônica Cloud e Tecnologia do Brasil S.A. (“TCloud”), a subsidiary of the Company, entered into a purchase and sale agreement for quotas and other covenants to acquire all quotas issued by IPNET Serviços em Nuvem e Desenvolvimento de Sistemas Ltda. (“IPNET”) and IPNET USA, LLC (“IPNET USA”), for up to R$223.8 million subject to the achievement of operational and financial metrics. This amount includes a non-compete agreement which was recognized separately from the business combination at a fair value of R$27.1 million. The remaining purchase price (R$196.8 million) was allocated to the net assets acquired, excluding the non-compete agreement, which was recognized as an intangible.
The total consideration was R$196.7 million with payment as follows: R$32.9 million was paid in cash upon completion of the Transaction and the remaining R$163.8 million will be paid in accordance with contractual clauses, updated by the variation of the IPCA / SELIC rate. IPNET specialized in the reselling of software and systems, as well as providing professional and managed services for adaptation, migration, and related support. With 20 years of experience in the market, the group played a key role in the digital transformation of businesses.
On October 1, 2024, TCloud signed the closing agreement, completing the acquisition of all quotas issued by IPNET and IPNET USA. This transaction expanded TCloud’s product portfolio and strengthened its professional and managed services, accelerating its growth. The investment also reinforces the Company’s digital ecosystem in the B2B segment, advancing its portfolio of innovative solutions.
Corporate Reorganization Involving IPNET
On November 1, 2025, Telefônica Cloud e Tecnologia do Brasil S.A. (“Telefônica Cloud Brasil”), a wholly owned subsidiary of the Company and the direct parent company of IPNET, approved and executed the merger of IPNET into Telefônica Cloud Brasil. As a result of this merger, IPNET was extinguished, and Telefônica Cloud Brasil succeeded all its assets, liabilities, rights and obligations. The merger was conducted as part of an internal corporate and operational reorganization aimed at simplifying structures, reducing costs and enhancing synergies between the two companies. The transaction was executed based on the book value of IPNET’s net assets and did not result in any change to the share capital of Telefônica Cloud Brasil nor to the Company’s ownership interest in that subsidiary.
Authorization for the operation of Vivo Pay SCD
On September 2, 2024, the Central Bank of Brazil granted the authorization for the operation of Vivo Pay Sociedade de Crédito Direto S.A. (“Vivo Pay SCD”), an entity indirectly controlled by the Company, as a Direct Credit Company, further enhancing Vivo’s Financial Services. This new license will enable end-to-end control of our operations, and enhances our ability to integrate financial services with Vivo’s existing channels, delivering an improved and cohesive user experience. The first new product to be launched under this license is our digital banking account, a cornerstone of our financial strategy.
Reverse Stock Split and Stock Split
On January 29, 2025, the Company announced that our board of directors approved the convening of an extraordinary shareholders’ meeting, to be held on March 13, 2025, to decide on a proposal to group all of our common shares at a 40:1 ratio, and subsequently split each of our common shares at a 1:80 ratio, without any change to the Company’s capital stock value, but solely to our total number of outstanding shares, with a resulting amendment to our by-laws. This transaction would not result in a change to our total amount of outstanding ADSs.
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The transaction provided greater liquidity to the shares issued by the Company and, consequently, improved the pricing formation process by increasing the volume of outstanding shares effectively negotiated and adjusting its price. In addition, the purposes of this transaction includes the following: (i) reduce operational and administrative costs resulting from the current configuration of our shareholder base; (ii) provide greater efficiency in managing its shareholder base; (iii) improve the efficiency of book-entry share registration and custody systems, (iv) enhance the provision of information and communication, improving the service to shareholders, and (v) provide greater efficiency in distributing proceeds to the Company's shareholders.
On March 13, 2025, the extraordinary shareholders’ meeting approved the transaction in full, including the reserve stock split followed by stock split, as well as the adjustment so that each ADR would represent two common shares. The transaction was implemented on April 15, 2025, and remaining fractional shares were grouped and subsequently sold in an auction held at B3 on May 19, 2025, with the net proceeds distributed proportionally to the shareholders entitled to such fractions.
Following the Free Position Adjustment Period, on April 15, 2025, the Transaction was finalized before B3 S.A. - Brasil, Bolsa, Balcão (“B3”), with shareholders having their shareholdings adjusted and the Company's shares being traded ex-share consolidation and ex-share split conditions. The auction for the sale of the remaining fractional shares resulting from the Transaction was held at B3 on May 19, 2025. The net proceeds obtained from the sale of these shares were allocated and distributed proportionally among all holders of fractional shares as follows: (i) for shareholders with complete registration data, the amounts were deposited into the current account indicated in the respective shareholder's registration; (ii) for shareholders with shares deposited at the B3 Central Depository, the amounts were credited directly to the Central Depository, which was responsible for transferring them to the respective shareholder through its custodian agent; and (iii) for other unidentified shareholders or those without complete registration data, the amounts are available at the Company, for the legal period, for receipt by the respective holder upon provision of complete registration data.
Acquisition of Samauma Brands (i2GO)
On March 18, 2025, the Company’s wholly owned subsidiary, Terra Networks Brasil Ltda., entered into a Quota Purchase and Sale Agreement to acquire all quotas of Samauma Brands Comércio, Importação e Exportação de Eletro‑Eletrônicos Ltda., owner of the i2GO brand, for an adjusted amount of up to R$66 million, subject to the achievement of agreed operational and financial metrics. This transaction is aligned with the Company’s strategy to strengthen its presence in the smartphone and electronic accessories market, in which it already operates through its OVVI brand, enhancing its ability to offer high‑quality products that meet the evolving needs of the market.
On March 21, 2025, after all conditions were satisfied, the acquisition was concluded through the execution of the Closing Agreement, thereby consolidating Samauma’s integration into the Company’s business portfolio. Following the closing of the transaction, the OVVI and i2GO brands will coexist in a complementary manner, broadening the Company’s product portfolio and strengthening its competitive positioning in the national electronic accessories market.
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Capital Expenditures
The following table sets forth our capital expenditures for each year in the three years ended December 31, 2025.
Year ended December 31,
2025 2024 2023
(in millions of reais)
Network 7,830.6 7,801.6 7,588.3
Technology / Information Systems 1,126.2 1,055.1 1,015.4
Others(1) 313.5 333.6 419.1
Total capital expenditures 9,270.3 9,190.4 9,022,9
(1)Consists primarily of: (i) handset sales made to corporate customers for the length of their contracts; (ii) furniture and fixtures, office equipment and store layouts; and (iii) spectrum licensing costs relative to the renewal of our 850 / 900 / 1800 MHz frequency.
To meet the needs of an increasingly data-driven and connected society, significant investments were made to support the strong growth of data usage in our fiber and mobile network, and 5G coverage in order to meet the legal obligations of the auction, and provide our clients with a better user experience. We continue to invest in expanding our national data transmission backbone to meet the increase in data traffic throughout Brazil.
Year Ended December 31, 2025
In 2025, we invested R$9,270.3 million, a 1% increase over the amount we invested in 2024 (R$9,190.4 million), primarily due to an increase of our investments in FTTH.
Investments were strongly focused on network projects (which accounted for 84% of investments in 2025), including 4G and 5G mobile access, backhaul transmission, backbone and FTTH expansion. These investments helped sustain our commercial and revenue growth while maintaining the quality of the services provided and preparing us for medium-term growth.
Year Ended December 31, 2024
In 2024, we invested R$9,190.4 million, a 2% increase over the amount we invested in 2023 (R$9,022.9 million), primarily due to the increase on investments in the 5G network.
Investments were strongly focused on network projects (which accounted 85% of investments in 2024), including 4G and 5G mobile access, backhaul transmission, backbone and FTTH expansion. The investments helped sustain our commercial and revenue growth, while maintaining the quality of the services provided and preparing us for medium-term growth.
B.Business Overview
We are the leading mobile telecommunications company in Brazil (with a 38.1% market share as of December 31, 2025, based on accesses), with a particularly strong position in postpaid mobile services (40.3% market share as of December 31, 2025, based on accesses). As of December 31, 2025, we reached 18.5% of total market share in FTTH (fiber-to-the-home) accesses in Brazil.
Our Vivo brand, under which we market our services, is among the most recognized brands in Brazil. The quality of our services and the strength of our brand recognition enable us to sustain this market leadership. We offer our clients a complete portfolio of products, including mobile and fixed-line voice, mobile data, fixed broadband, ultra-fast broadband, or UBB (based on our FTTH and FTTC infrastructure), Pay TV, information technology and digital services (such as entertainment, cloud, security and financial services). We also have one of the most extensive distribution networks in the sector, where our clients can obtain certain services, such as purchasing credit for prepaid phones.
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We seek to continue to increase our operating margins by focusing on developing and growing our product offerings so that they comprise an integrated portfolio that allows us to extend our customers' lifetime value.
Our Operations and Services
Our operations consist of:
•local and long distance fixed-line telephone services;
•mobile services, including value-added services;
•data services, including broadband services and mobile data services;
•Pay TV services mainly through IPTV;
•network services, including rental of facilities, as well as other services;
•wholesale services, including interconnection;
•digital services;
•services designed specifically for corporate customers; and
•the sale of wireless devices, accessories and consumer electronics.
Fixed-line voice services
Our portfolio of fixed-line telephone services, or STFC services, includes local, domestic long-distance and international long-distance calls.
Local services
Fixed-line local services include activation, monthly subscription, public telephones and measured services. Measured services include all calls that originate and terminate within the same area code within our concession region, which we refer to as local calls.
Intraregional, interregional and international long-distance services
Intraregional long-distance fixed-line services consist of all calls that originate in one local area or municipality and terminate in another local area or municipality within our authorization region. Interregional long-distance services consist of state-to-state calls within Brazil and international long-distance services consist of calls between a phone line in Brazil and a phone line outside Brazil. We were the first telecommunications company to be granted the authorization to develop local, intraregional, interregional and international services throughout Brazil.
Mobile services
According to data regarding market share published by ANATEL in December 2025, we are the leading provider of mobile telecommunications services in Brazil in terms of accesses.
Our mobile portfolio includes voice and broadband internet access through 3G, 4G, 4.5G and 5G, as well as value-added services (such as Atma, VivaE, Vale Saúde, Vivo HomeFix, Vivo BTFIT, Go Read, Ubook, Hube Jornais, NBA, McAfee, Forbes Brasil, Casa do Saber, Super Comics, Skeelo, Babbel, and Vivo Pay), prepaid plans with data sharing features, family plans, voice mail, caller identification, voice minutes in unlimited bundles to mobile and fixed-line phones, and digital services such as multi-media backup, cloud-based services to save texts, entertainment and music apps, advertising platforms, among others.
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We also offer wireless roaming services through agreements with local mobile service providers throughout Brazil and other countries, allowing our subscribers to make and receive calls while outside of our concession areas. We provide reciprocal roaming rights to the customers of the mobile service providers with which we have such agreements.
Data services
We provide fixed broadband through fiber (i.e., FTTH and FTTC) and xDSL technologies, with download speeds reaching up to 10 Gbps.
In 2025, we continued to cover 100% of the municipalities in our concession area in the state of São Paulo and hundreds of others throughout Brazil, reaching approximately 7.8 million fixed broadband customers in total, and we expanded our national fiber network to reach approximately 31.9 million homes, of which 31.0 million consisted of FTTH technology.
In mobile broadband, we use a variety of technologies to provide wireless internet services to our customers. As of December 31, 2025, we covered 4,949 municipalities with our 3G network, reaching 97.5% of Brazil’s population. We also offer 4G LTE technology, which, by the end of 2025, was available in 4,901 municipalities, reaching 97.0% of Brazil’s population, 4.5G LTE through carrier aggregation in 4,141 municipalities, reaching 93.3% of the Brazilian population, and also 5G technology, present in 716 municipalities, equivalent to 67.7% of the Brazilian population.
Pay TV services
We began offering subscription-based television services, or Pay TV services, via DTH (“direct to home,” a type of service that uses satellites for the direct distribution of television and audio signals to subscribers) on August 12, 2007. By the end of 2022, we discontinued the DTH operations, disconnecting all customers. From 2023 onwards, we only provide Pay TV services by means of IPTV (a type of service that offers video broadcast through the IPs) technology. As of December 31, 2025, we had approximately 733,292 Pay TV customers.
Network services
Our service & network management technology ensures comprehensive management and supervision of all our network processes and network performance for our clients. Our network management center monitors the critical network operational parameters of the countrywide transmission backbone, IP networks, mobile and fixed packet/circuit core networks, value-added services/multimedia platform and global services, radio access network, infrastructure and online services performance, as well fixed access network across the country, broadband networks, network interconnection, portability and IPTV/DTH. Our service management center monitors customer experience and service quality across all platforms, allowing real-time data analysis with advanced analytics and proactive monitoring tools. We believe that this initiative represents a significant step forward in our commitment to delivering exceptional quality of mobile services, with enhanced customer experience, proactive service quality management, data-driven decisions and higher operational efficiency.
The center is able to identify abnormalities in both our network (fixed and mobile) and in third-party networks including networks of other operators and other corporate clients, using failure, signaling, quality and service monitoring systems. Our service & network management center is integrated with maintenance and operations teams that maintain and operate mobile and fixed network elements, as well as infrastructure and transmission, in addition to the radio network elements and computing bases, service platforms and communications backbones.
Our network provides for continuity of service to our customers in the event of network interruptions. We have developed contingency plans for potential catastrophes in our switchboard centers, power supply interruptions and security breaches.
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We continuously aim to consolidate our network and increase its offerings, to deliver the best possible service to our customers and to meet their expectations. We are incessantly improving and refining our observability main process, with higher effectiveness of incident correlation, faster fault recovery and proactive incident management. These objectives have been driven by the self-monitoring capabilities with the development of a customized Telefonica Event Management System (TEMS), as well as by the self-healing capabilities with the development of integrated-system enablers (PUR) and the evolution of Robotic Process Automations (RPA). This advancement gives our team more efficiency and speed in detecting and solving problems in our networks.
Some of the improvements we have implemented in recent years include advancements in migrating from time-division multiplex switches to next-generation network switches, which offer new digital services to our customers and reduce our maintenance costs, including improvements in security levels, power supply, batteries, and air conditioning infrastructure.
In addition, we are widely applying advanced virtualization solutions (net functions virtualization, or NFV) with the purpose of supporting the launch of the brand-new fifth-generation mobile network (5G-NSA/SA), which is fully operating and prepared to address future market and customer expectations by providing massive device connectivity, ultra-high-density deployments (through IoT technology), ultra-low latency applications and higher data transfer rates.
Network and facilities
We provide services referred to as the industrial exploration of dedicated line (Exploração Industrial de Linha Dedicada), or EILD, pursuant to our authorizations. The EILD consists of the rental of dedicated circuits and clean channel protocols to provide services to third parties.
In addition, we are able to offer a complete portfolio of wholesale products, including L2L, IP, Ethernet and MPLS. All of these products are used to meet the demands of other network operators and regional internet providers. The circuits are requested with different service level agreements, and we are required to provide the facilities with contingency routes, sites and equipment to improve the service against points of failure.
Our network consists of an access layer that connects our clients through our copper or optical networks, which are connected to voice and data centers. These centers are interconnected locally or remotely through transmission equipment connected predominantly with fiber optics and occasionally through a microwave network, which together form a network layer that enables connectivity between the various platforms as well as interconnection with other carriers. Our network strategy is based on the expansion of the fiber optic access network to allow greater coverage and broadband services for our customers, as well as to develop an integrated multiservice network and multimedia applications. As a telecommunication service provider, we do not manufacture equipment for the construction of our networks and facilities. We buy the equipment from qualified suppliers in Brazil and abroad and through such equipment, we implement our networks and facilities through which we supply our services.
Wholesale services (including interconnection)
We have continuously adapted and expanded our network topology aiming to develop new business opportunities throughout Brazil by offering services to other telecommunications companies. The result has been a significant increase in the number of providers that use our wholesale services.
As part of our wholesale services, we provide interconnection services to other network providers. We earn revenue from any call that originates from another mobile or fixed-line service provider network connecting to one of our customers. We charge the service provider from whose network the call originates an interconnection fee for every minute that our network is used in connection with the call. See “—Operating Agreements—Interconnection Agreements.”
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As of December 31, 2025, we had 1,007 local and long-distance interconnection agreements with Telefônica Brasil (fixed-line and mobile operation) and 267 agreements for the provision of local and long-distance traffic.
An interconnection is a link between compatible telecommunications networks that enables a fixed-line or mobile service user of one network can adequately communicate with the users of a network from another provider.
All providers of telecommunication services (fixed or mobile) are required to provide interconnection upon request to any other telecommunication collective service provider. The conditions for interconnection agreements may be freely negotiated among the parties. The agreements are required to be formalized by contract, whose effectiveness depends on ANATEL’s approval. If any given agreement is contrary to the principles of free competition or conflicts with other regulations, ANATEL may reject it. If the parties cannot reach an agreement on the terms of interconnection, including the interconnection fee, ANATEL may determine those terms and conditions by arbitration.
Digital services (including value-added services)
Overview
In 2025, Vivo reached the milestone of 4.1 million OTTs subscriptions, reflecting continuous and consistent growth year after year. The focus on digital video and music services has solidified, with the launch of key players such as Apple Music, YouTube and Netflix. Vivo TV App, is also a strategic app for Vivo as it is owned by the company. This helps to consolidate the company’s position as a digital services provider and contributes to healthy growth.
Digital channels played a crucial role in this success, accounting for 75% of sales participation, representing a growth of 10p.p. year over year. This not only reduced costs but also enabled a more efficient operation, achieving significant sales records. The revitalization of sales checkout at App Vivo was a highlight, significantly contributing to business acceleration by providing a simpler, fully digital Journey to buy digital services.
Furthermore, Vivo continues to pursue a strategy of offering better cost-benefit solutions to customers. Throughout the year, service bundles with attractive pricing were created, enhancing the perceived value of our products and generating competitiveness. The launch of Vivo Total with digital services, is a significant achievement that reinforces our commitment to creating a comprehensive value proposition that addresses customer’s needs.
Financial services
Financial services remain a strategic pillar for Vivo, consolidating our evolution into a broad digital services ecosystem and expanding our relevance beyond connectivity. In 2024, we advanced this strategy by consolidating all financial solutions under the Vivo Pay brand, now fully integrated into the Vivo App and visible to more than 28 million users, as of December 31, 2025.
Our entry into financial services began in 2020 with the launch of personal loans. Since then, the product has matured significantly. Today, Vivo Pay Personal Loan—formerly Vivo Money—offers credit between R$500 and R$50,000, with terms of up to 36 months and pricing adapted to each customer’s profile. Supported by advanced data analytics, our credit model enhances assertiveness and helps reduce risk. As of December 2025, since the launch, personal loans have reached R$1.1 billion in total disbursements, growing 33% YoY, and the credit portfolio reached R$321 million, excluding loans over 360 days past due. Our nonperforming loans due over 90 days stood at 28.4%, as of December 31, 2025, reflecting stable performance in unsecured credit.
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Expanding our credit portfolio, we launched products designed to diversify risk and address high-demand business:
–FGTS Birthday Withdrawal Anticipation: A secured product offering competitive rates starting at 1.29% per month, with R$28 million already loaned as of December 31, 2025. Customers can front up to 10 years of withdrawals, with automatic repayment through their FGTS balance.
–Workers Credit (Crédito do Trabalhador): Introduced in September 2025, this payroll-linked loan targets formal private-sector workers, offering R$500 to R$20,000 with up to 36-month terms. Regulatory updates enabling digital contracting through CTPS Digital opened a market of 45 million eligible workers, supporting faster growth versus traditional personal loans.
Our strategy also includes credit portfolio diversification in partnership with other fintechs such as Noverde, Creditas, Facio and Klubi, offering Home Equity, Auto Equity, Micro Loans and Consortia.
A major milestone was the Central Bank’s approval of Vivo Pay as a Direct Credit Society (SCD) in 2024, enabling full operational control and paving the way for the launch of our digital account, currently in controlled testing with employees.
Insurance Services
Insurance remains another essential component of our financial services ecosystem. Our partnership with Zurich enabled the creation of Vivo Seguro Celular, a simple and fully digital solution to protect smartphones. Building on this success, we expanded coverage to include notebooks, tablets, smartwatches and headphones, and as of December 31, 2025, the portfolio had reached approximately 600,000 insured devices. Notably, more than 40% of smartphones sold in that period left our stores with insurance included, and the customer base grew 42% YoY as of December 31, 2025.
In 2024, we strengthened distribution by enabling the full purchase and management of insurance through the Vivo Pay section of the app. We also launched a simplified plan priced at R$14.90 per month, offering R$2,000 in coverage, which contributed to strong commercial traction.
Our portfolio continued to expand with:
–Home Insurance (launched in March 2025, in partnership with Chubb and Porto Serviços): three plans ranging from R$13.90 to R$85.90, with coverage between R$100,000 and R$1 million; and
–Travel Insurance (launched in December 2025 with Chubb): plans for domestic and international travel starting at R$29.90, with coverage from R$20,000 up to US$35,000.
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Corporate innovation
In recent years, we have not only established new business ventures that have accelerated our digital transformation but also increased the contribution of these services to our overall revenue. These services accounted for 12.1% of our total revenue in the year ended December 31, 2025. We continue to invest in research and development to create innovative services that enhance our customers’ experience and provide greater convenience in their daily lives:
•In the healthcare ecosystem, in 2023, we acquired 100% of the shares of Vale Saúde Sempre, a startup operating as a healthcare services marketplace. The platform offers affordable access to consultations (in-person and telemedicine), exams, and surgical procedures through a monthly subscription. It boasts an accredited network of thousands of laboratories and medical clinics throughout Brazil. In 2024, we leveraged this acquisition to expand our operations in the B2C segment, utilizing Vivo’s extensive sales force, increasing our B2B customer base, adding new partners to the accredited network, and introducing dental services. In 2025, we expanded our network of clinics and laboratories with the goal of bringing healthcare to all regions of Brazil, and we also enhanced our portfolio by offering discounts at more than 11,000 pharmacies. As a result, Vale Saúde Sempre served over 471,000 users in the year ended December 31, 2025 and has seen its net revenue multiply by approximately 1.6x in the year ended December 31, 2025.
•In education, we advanced our joint venture with Ânima Educacional, VivaE, launched in 2022. This EdTech focuses on open courses aimed at preparing individuals for emerging digital market professions. With its proprietary teaching methodology, VivaE now offers over 50 courses and surpassed 100,000 users as of December 31, 2025. Additionally, it began exploring the B2B market and participated in Telefônica’s internship selection process, where candidates took courses, and the top performers advanced. In 2025, VivaE began selling courses directly to companies.
•Additionally, we repositioned our Smart Home value proposition by focusing on key customer journey pillars such as consultancy, installation, device configuration, and specialized support. Initially offering on-site installation and automation services in São Paulo, we expanded to every city where Vivo broadband is available. In addition, Vivo launched a home monitoring service that provides cameras for a monthly fee, highly valued by customers with pets, children, and elderly relatives. This service offers options for live feed or recording, accessible via the Vivo Smart Home app. The app now includes a dedicated Smart Home section to educate customers about devices and functionalities, showcase purchasable products, and integrate connectivity and smart home features.
•In the renewable energy business, GUD Energia—our joint venture with Auren, established in 2024—is advancing its strategy to expand access to competitive and sustainable energy in the medium-voltage segment, while remaining fully focused on the opening of the low-voltage market, approved in November 2025 by the Brazilian federal government through Law No. 15,269. This regulatory milestone will enable GUD to offer renewable and sustainable energy to millions of B2B customers by 2027 and to tens of millions of residential customers by 2028.
In addition, Vivo Ventures, our corporate venture capital fund, made four strategic investments in 2025 (for more information, see “Item 4. Information on the Company—A. History and Development of the Company—Historical Background—Launch of Corporate Venture Capital Fund”), as follows:
In 2025, Vivo Ventures made nine investments across strategic areas such as Fintech, Education, Insurtech and Legal, reinforcing its focus on digital platforms with strong potential for operational synergies, distribution leverage, and value creation within Vivo’s ecosystem.
In December 2024, Vivo Ventures entered into a commitment of US$2 million with Canary, a leading venture capital manager in Brazil, as part of its funds-of-funds strategy, with the objective of strengthening its presence within the venture capital ecosystem, enhancing long-term relationships with top-tier fund managers and expanding access to high-quality investment opportunities aligned with its strategic priorities.
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In February 2025, Vivo Ventures completed an equity investment of R$11.4 million in Facio, a fintech specialized in credit origination and automation for financial institutions, offering end-to-end solutions that streamline underwriting, risk assessment and customer onboarding through technology and data-driven processes. The investment supports Facio’s expansion in the Brazilian credit market and aligns with Vivo’s strategy to strengthen its presence in financial services and digital lending solutions.
In July 2025, the FIP executed an initial investment of R$1.36 million in Elevify, an edtech focused on upskilling and professional development, offering digital education solutions aimed at improving employability and workforce qualification through scalable online programs. This investment aligns with Vivo Ventures’ interest in education platforms that leverage technology to democratize access to high-quality learning.
In September 2025, Vivo Ventures committed R$35.0 million to AsaaS as part of a minority equity acquisition. AsaaS is a fintech that provides an integrated financial management and payments platform for small and medium-sized businesses, enabling billing, collections, payments and financial control through a single digital interface. The company supports SMEs in improving cash flow management and operational efficiency, strengthening Vivo’s positioning in solutions tailored to the SME segment.
In October 2025, the FIP acquired a minority stake of R$13.3 million in 180 Seguros, an insurtech that offers embedded insurance solutions through APIs, enabling companies to seamlessly integrate insurance products into their digital journeys. The platform focuses on modular and flexible insurance offerings that enhance customer experience and open new digital distribution channels, in line with Vivo Ventures’ strategy in embedded finance and digital protection solutions.
Also in October 2025, Vivo Ventures became a shareholder of Ada Tech through a corporate reorganization and merger involving Vivae — the edtech jointly created by Telefônica Brasil S.A. and Ânima Educação — and Ada Tech. As part of this transaction, the equity interest in Ada Tech previously held by Wayra, together with Telefônica Brasil’s stake in Vivae, was transferred to FIP Vivo Ventures, which now directly holds the participation and remains a shareholder of Ada Tech. Ada Tech is an education technology company focused on training and reskilling professionals in software development, data, artificial intelligence and other high-demand digital skills, combining online learning, hands-on projects, and corporate partnerships.
In December 2025, Vivo Ventures also carried out a follow-on investment of R$2.7 million in Facio, further reinforcing its confidence in the company’s execution and growth trajectory. The additional capital is intended to support product development, commercial expansion and the strengthening of its technology platform.
In December 2025, the FIP concluded an initial equity allocation of R$1.9 million in Inspira. Inspira is a legaltech that develops digital solutions to increase efficiency and automation in legal operations, supporting law firms and corporate legal departments with tools for process management, analytics and decision-making.
Finally, Vivo Ventures also approved an increase in the fund’s committed capital, raising its total size to R$470 million. As part of this expansion, the FIP received a new share subscription of R$150 million, with 98% subscribed by Telefônica Brasil S.A. and 2% by Telefonica Open Innovation, S.L. The subscribed amount will be disbursed through capital calls as new investment opportunities in startups are executed.
Finally, in recognition of our efforts in developing a robust digital ecosystem, Vivo received several prestigious awards in 2025:
Valor Inovação Brasil — Vivo ranked 1st in Telecommunications and 9th overall in the Valor Inovação ranking, which highlights the 150 companies with the best innovation practices in Brazil.
EY Brasil, Sling Hub, and Alya Ventures — Vivo was recognized in the Ranking of Corporations That Invested the Most in Brazilian Startups in 2024, promoted by Sling Hub and its partners.
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100 Open Corps — Vivo ranks Top 2 in open innovation in Brazil and is the leader in the Telecommunications sector, according to the 10th Edition of the 100 Open Startups Ranking.
MIT Innovative Workplaces Brazil — Vivo is part of the ranking of the 20 most innovative organizations in Brazil, recognized for their ability to drive transformation.
Prêmio Seleção Mobile Time 2025 — Vivo won in the Innovation in Telco category for its GUD Energia initiative, recognized by the jury among the top mobile innovation projects.
Corporate services
We offer our corporate clients comprehensive telecommunications solutions and IT support designed to address specific needs and requirements of companies operating in all types of industries (retail, manufacturing, services, financial institutions, government, etc.).
Our clients are assisted by our highly qualified professionals who are capable of meeting the specific needs of each company with voice, data, broadband, computer services solutions, including hardware and software, and digital solutions, such as cloud, cybersecurity and IoT. We work to consistently achieve greater quality and efficiency in our services and increase our level of competitiveness in the market.
Sale of smartphones, devices and accessories
We sell 5G NR and LTE devices such as smartphones, broadband USB modems and devices that are certified to be compatible with our network and service, including eSIM devices. We also sell a range of connected and non-connected gadgets offering our customers quality and technological products such as tablets, notebooks, gaming consoles, wearables, speakers, e-health devices, smart home devices, TVs, etc.
We have special offers on smartphones and other data devices for customers of bundled packages.
Our current smartphone suppliers are Samsung, Apple, Motorola and Oppo, our device suppliers area Intelbras, Flex (Mitrastar), Blucastle, Tellescom (Askey) and ZTE and our gadgets suppliers are Samsung, Apple, Harman (JBL and Kardon), Lenovo, LG, Hisense, Timbro (Amazon), Intelbras, Positivo (Positivo and Vaio), Steck, Allied (Logitech, TPLink and Xbox), Alfacomex (Geonav), Customic, i2Go, Aya Pitaya, Glowshine, Simerx, Motorola, Multi (DJI and Multi), DPC (Renpho), Proparts (Garmin), Flex (Mitrastar), Tellescom (Askey), Blucastle, RCELL (Nintendo and Playstation), Sony Entertainment (Playstation), WAP (WAAW), Relaxmedic and Up2Tech (JBL, Lenovo, Nintendo, Playstation, Anker, Philips, LG and TCL).
Smartphone and other electronics sales continued a positive trajectory in 2025 with important growth results, aligned with our strategy to gain profitability and become an important player in the electronics segment. This was the result of our strategy of portfolio expansion, enhanced distribution, and communication initiatives emphasizing that Vivo can provide everything customers need, as well as through our sales channels attracting high-value customers to our physical and online stores. We also had important achievements with our own accessories brand, Ovvi, launching new products focused on design excellence and quality, making relevant partnerships and sponsorships, and adding even more market value to our business.
We will continue to seek to provide everything customers need, leveraging our sales channels, which are focused on attracting high-value customers to our physical and online stores.
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Rates, Taxes and Billing
Rates
We generate revenue from (i) activation and monthly subscription charges, (ii) usage charges, which include measured service charges, (iii) interconnection fees that we charge to other telecommunications service providers, and (iv) other additional services. Rates for all telecommunications services are subject to extensive regulation by ANATEL. We set forth below the different methods used for calculating our rates.
Local rates
With the termination of the STFC Concession agreement through the signing of the Settlement Agreement with ANATEL, we undertook a commitment until the end of 2028 to maintain service to customers in 373 locations in 166 municipalities in the state of São Paulo through a service plan that ensures consumers in these areas receive pricing conditions that are compatible with or more advantageous than those offered under the Basic Service Plan in effect at the time of adaptation. This includes offers similar to (i) the Local Basic Plan of the Concession (for customers who mainly make short-duration calls - up to three minutes - during business hours) and (ii) the Special Class Individual Access Plan – AICE (created specifically for families enrolled in government assistance programs).
On the other hand, the company became able to provide fixed-line telephony services throughout the country through an Authorization. In the Authorization modality for the provision of fixed-line telephony, the company ceased to have obligations related to the availability of mandatory Offers, being able to work only with Offers, which can be made available for commercialization and/or discontinued with greater flexibility, according to rules set forth in ANATEL’s regulations.
Long-distance rates
Rates for domestic, long-distance calls are based on the time of day, the day of the week, and the duration and distance of the call, and may also vary depending on whether special services, including operator assistance, are used. We have several options for domestic, long-distance calling offers for consumers using our carrier dial code (15). Customers of any local or long-distance operator may use dial code 15 when dialing long-distance to benefit from our rates. In March 2020, ANATEL approved Resolution No. 724, which established a standard for the implementation and monitoring of tariff freedom in the STFC, for use by the general public in the national, long-distance mode. Since then, we have been free to set domestic long-distance fees at market rates. Later, Resolution No. 724 was replaced by Resolution No. 768 in August 2024.
We also offer international long-distance rates, that are also available to all users using dial code 15. International, long-distance calling charges are based on the time of day, the day of the week, the duration and the destination of the call, and may also vary depending on whether special services are used, including operator assistance. Our rates for international services are not subject to regulation and are not required to follow the annual rate adjustments described above for other services. We are free to negotiate our fees for international calls based on the international telecommunications market, in which our main competitor is Claro (through its Embratel business).
With respect to long-distance calls, we have developed alternative rate offers for residential and corporate customers.
Mobile services rates
Rates for our Local Basic Plan and certain roaming charges incurred in connection with alternative offers are subject to annual adjustments pursuant to our authorizations. Current rates, which are revised annually, can be readjusted for the following year at most by the rate of inflation as measured by the IGP-DI index. The maximum rate applies to all mobile service offers, but mobile operators are allowed to freely set the prices charged on these offers (other than with respect to certain roaming charges).
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The initial price cap we agreed upon with ANATEL in our authorizations was based on previously existing or bidding prices, and has been adjusted annually based on a formula contained in our authorizations. As of the date of this annual report, the most recent adjustment was approved in February 2025, which set fees at R$0.22044 for regular hours and R$0.15430 for reduced hours (net of taxes).
Interconnection fees
We are paid interconnection fees by any fixed-line or mobile service provider that either originates or terminates a call within our network. We also pay interconnection fees to other service providers when we use their network to place or receive a call. The interconnection fee is a flat fee charged per minute of use that directly affects fixed-line and mobile services rates. Since 2005, interconnection agreements are freely negotiated among the service providers, subject to a price cap and to compliance with the regulations established by ANATEL, which include not only the interconnection basic costs including commercial, technical and legal aspects, but also the traffic capacity and interconnection infrastructure that must be made available to requesting parties. If a service provider offers to any party an interconnection fee below the price cap, it must offer the same fee to any other requesting party on a non-discriminatory basis. If the parties cannot reach an agreement on the terms of interconnection, including the interconnection fee, ANATEL can establish the terms of the interconnection.
For additional information about interconnection fees, see “—Regulation of the Brazilian Telecommunications Industry—Interconnection fees.”
Data services rates
We receive revenue from charges for data transmission, which includes our fixed broadband, dedicated analog and digital lines for privately leased circuits to corporations and other services. Data transmission rates are not regulated by ANATEL, including for EILD (wholesale links up to 34 Mbps) and High Capacity Data Transport (wholesale links above 34 Mbps) that are no longer regulated markets. Multimedia services operators can freely set the rates for their offers.
TV rates
Pay TV rates are not regulated. Service providers are allowed to freely set the rates for basic and alternative offers.
Taxes
The cost of telecommunication services to each customer includes a variety of taxes. The main tax is a state value-added tax, the Imposto sobre Circulação de Mercadorias e Serviços, or ICMS, which the Brazilian states impose at rates ranging from 4% to 24% (except for the state of Amapá, which maintains a 29% ICMS rate to Telecommunications Services) on certain revenues from the sale of goods and services, including telecommunication services,
Telecommunication services have recently been classified as essential by Supplementary Law No. 194/2022. As such, the ICMS rates on telecommunication services cannot exceed the general ICMS rates foreseen by each State’s local regulations. Other taxes include: (1) Federal Social Contributions (Contribuição para o Programa de Integração Social), or PIS, and Social Security Financing Contributions (Contribuição para o Financiamento da Seguridade Social), or COFINS; (2) FUST contributions; (3) FUNTTEL contributions; and (4) FISTEL contributions.
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Significant changes in tax legislation
Constitutional consumption taxes reform
On December 20, 2023, Constitutional Amendment No. 132 was enacted, introducing a new model of taxation on consumption in Brazil. Complementary Law No. 214/2025, published on January 16, 2025, regulates the tax reform. In summary, this reform replaces federal taxes PIS and COFINS with a Contribution on Goods and Services (CBS), while state tax ICMS and municipal tax ISS will be replaced by a Tax on Goods and Services (IBS). Taxation will be exclusively destination-based and fully noncumulative, meaning that the CBS and IBS taxes applied at each stage will be credited and deducted from the taxable base by taxpayers in their calculations, except for acquisitions intended for personal use and consumption. The CBS and the IBS will be calculated “outside” the taxable base, whereas the current ICMS and ISS taxes are calculated “inside” and included in the taxable base itself.
A transition period from 2026 to 2032 will gradually phase out the existing taxes in favor of the IBS and CBS. During this transition, operational complexity is expected due to the coexistence of two consumption taxation models. However, taxation is anticipated to be effectively simplified beginning in 2033. In 2026, a testing period will commence, during which a 0.9% CBS rate and a 0.1% IBS rate will be applied. However, this levy will not result in an actual economic burden, as compliance with the ancillary obligations related to the new taxes during this period effectively exempts taxpayers from payment. Alternatively, should any amounts be paid, the sums collected as CBS and IBS may be offset against PIS and COFINS contributions, such that no economic effect is expected for 2026.
The reform also introduces a federal selective tax on the production, extraction, commercialization, or import of goods and services harmful to health or the environment. Notably, a constitutional provision exempts telecommunications services from this tax.
Complementary Law Project No. 108/2024, which mainly addresses tax auditing and litigation in connection with this reform, has been approved by the Brazilian Congress and is currently pending presidential sanction. The new taxes will still require further regulation through additional laws and norms, and further input on this may become available during the 2026 testing period.
Changes in the ICMS tax rate
In June 2022, Complementary Law No. 194 was enacted, prohibiting higher tax rates for telecommunications services compared to generally applicable rates, in compliance with an STF ruling. As a result, telecommunications services, which had historically been subject to higher ICMS rates than other products and services, are now taxed at the same rates as general goods under this law.
Towards the end of 2023, 11 states—including Bahia, Ceará, Distrito Federal, Goiás, Maranhão, Paraíba, Pernambuco, Paraná, Rio de Janeiro, Rondônia, and Rio Grande do Norte—adjusted their general ICMS tax rates, effective in 2024. On average, these changes resulted in a 2% increase in the ICMS rate.
In 2025, three additional states (Piauí, Maranhão, and Rio Grande do Norte) implemented further increases to their general ICMS tax rates, ranging from 1% to 2%. Telefônica Brasil is actively working to ensure accurate ICMS tax calculations within the deadlines specified by each state. These changes may potentially affect the prices charged to our customers.
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Changes in the deductibility rules for interest on shareholders’ equity
On December 29, 2023 Law No. 14,789 was enacted into law and set forth new rules for calculating interest on shareholders’ equity. The rule mainly focuses on adjustments to equity through the exclusion of transactions with related parties, as well as some accounts such as tax incentive reserves. We do not expect that these new rules will have a significant impact on the calculation of interest on shareholders’ equity for Telefônica Brasil.
Changes in investment grants rules
New regulations for calculating tax incentives associated with investment subsidies were introduced through Law 14,789, dated December 29, 2023. These regulations bring about a new framework in which a legal entity, taxed on actual profits, that receives a grant from the Union, states, the Federal District, or municipalities for the implementation or expansion of an economic enterprise may compute an investment subsidy tax credit. The legal entity is required to formally submit a request to the Brazilian Federal Revenue Service, providing all relevant details of the enterprise, to obtain prior approval for the granted tax credit. If there is no response from the Brazilian Federal Revenue Service within 30 days, qualification becomes automatic.
The previous system led to substantial disputes involving billions of dollars between taxpayers and the Brazilian Federal Revenue Service. Consequently, the new law establishes a mechanism for companies to resolve their debts, with reductions in the disputed amounts if the taxpayer opts for settlement. Telefônica Brasil is not anticipated to be significantly impacted by the new rules and does not currently have a tax dispute related to this matter.
Changes in taxation rules on investments in investment funds
On December 12, 2023, Law 14,754/23 was enacted, introducing several normative changes exclusively applicable to individuals domiciled in Brazil. Among these changes, a new rule concerning withholding tax on income earned by corporate investors in investments in Brazilian investment funds was implemented. The law stipulates periodic withholding in May and November of each year, with a rate of 15% (general rule) or 20% (specific rule applicable to investment funds with a portfolio of securities having an average term equal to or less than 365 days).
However, the new rule for periodic withholding of IRRF (Income Tax on Financial Transactions), in principle, is not expected to have significant effects on Telefônica Brasil concerning the income generated by the our equity investment fund, Vivo Ventures and our credit rights fund, Vivo Money Credit Rights Investment Fund. This is due to a specific rule excluding them from this regulatory scope as they are qualified as investment entities and comply with other requirements expressed in the legislation. As the matter is still controversial and requires clarification from the Brazilian Federal Revenue Service, we are closely monitoring the topic to ascertain if this scenario changes.
Introduction of OECD-inspired minimum income taxation rules
On December 27, 2024, Law 15.079/24 was enacted, establishing an additional Social Contribution on Net Income (“CSLL”) as part of the process of adapting Brazilian legislation to the OECD Global Rules Against Base Erosion (“Pillar II”). According to this law, whenever the Company, adopting the calculation criteria provided therein, determines an effective combined rate of Income Tax and Social Contribution on Net Profit lower than 15%, it must make an additional payment until it reaches this minimum percentage. This rule has been in effect since January 2025, and the Company does not expect a significant impact from this rule on its tax payments, as it already complies with the established limits.
Transfer Pricing Rules – Alignment with OECD Standards
On December 28, 2022, Law No. 14,596/2023 was published, later regulated by RFB Normative Instruction No. 2,161/2023, which established the new Brazilian Transfer Pricing regime, aligned with OECD guidelines. The new rules became mandatory as of January 1, 2024, and aim to ensure that intercompany transactions are carried out in accordance with the arm's length principle.
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The Company is currently in the process of preparing the analysis for the corresponding fiscal year, including a comparability study, supporting documentation, and a review of applicable methods, as provided for in current legislation. Although the technical process is still under development, the Company does not expect significant impacts from the adoption of the new transfer pricing regime, given the nature of the transactions carried out and the history of compliance with international standards.
The Company will continue to monitor the application of the regulations and will keep its financial statements updated based on any adjustments identified upon completion of the formal transfer pricing analysis."
Billing
For postpaid customers, we send each contract customer a monthly bill covering all of the services provided during the previous monthly period. Pursuant to Brazilian law, telephone service providers are required to offer their customers the choice of at least six different monthly payment dates. For prepaid customers, billing is available online.
We have a billing and collection system with respect to local, national and international long-distance voice, subscriptions, broadband, data, IT services, outsourcing, television and third-party services. For invoice payments, we have agreements with various banks. These agreements include options for customers to select their preferred payment type: direct debit, PIX, payment to a bank, Internet and other collection agencies (including lottery-playing facilities, drugstores and supermarkets). We aim to avoid losses in the implementation of new processes and the roll-out of new products through the monitoring of billing, collection and recovery controls.
These practices are closely monitored by our revenue assurance team, which measures every risk of revenue loss detected along the billing and collection chain. These risks are managed to minimize revenue losses.
Co-billing
In accordance with Brazilian telecommunications regulations, we use a billing method called “co-billing” for both fixed-line and mobile services. This method allows billing from other phone service providers to be included within our own invoice. Our customers can receive and subsequently pay all of their bills (including the fees for the use of services of another telephone service provider) on our invoice. To allow for this method of billing, we provide billing and collection services to other phone service companies. We have co-billing agreements with national and international long-distance phone service providers. Similarly, we use the same method of co-billing to bill our services to customers of other fixed-line and mobile providers. This service is charged to the long-distance operator, by means of a call record described in the invoice.
Value-added services
Value-added services such as entertainment, information and online interactivity services are available to mobile prepaid, postpaid and fixed-line customers through agreements with content suppliers. These agreements are based on a revenue-sharing model.
Third-party services
We incorporate third-party services in our billing, collection and transfer process. These services are later passed on to the third-party contractor.
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Collection
Our collection practices for delinquent customers comply with the guidelines established by ANATEL (the Brazilian National Telecommunications Agency), as well as with the regulations of the Telecommunications Services Agency (RACO) and the Consumer Protection and Defense Foundation (PROCON). As a general rule, for mobile and fixed-line services, customers who remain past due for more than 15 days may have promotional benefits suspended. If payment remains outstanding for more than 30 days after the suspension of such benefits, service may be fully suspended, including both outgoing and incoming calls, until payment is settled.
For Pay‑TV services, full suspension may occur if payment is overdue for more than 15 days. Customers with outstanding balances may opt for an installment payment arrangement. However, if bills remain unpaid for 60 days following full suspension, the contract may be terminated and the delinquency reported to credit protection bureaus.
The debt collection process involves sequential steps, beginning with internal outreach via interactive voice response, SMS, and email, followed by a formal payment reminder notice. If the outstanding balance persists, the customer’s information may be forwarded to an external credit recovery agency.
Concurrently with our internal process, delinquent customers are also contacted by collection agencies. Customer risk profile, overdue debt and other quality issues are used to increase strategy efficiency and maximize debt recovery efforts. As of January 2018, bad debt provisions were adjusted due to changes brought by IFRS 9, including new criteria that follow an expected credit loss model, adopting a percentage of risk for each debt payment profile until the moment of effective loss (100%). The percentages were calculated according to the historical behavior of delinquency for each segment. In accordance with Brazilian regulations, bad debt write-offs are permitted for late payments of zero to R$5,000 if they are over 180 days late or R$5,001 to R$30,000 if they are over 365 days late. Late payments of over R$30,001 that are open for more than 365 days require a lawsuit to be initiated. This rule is applied for outstanding debt through October 8, 2014; after this period, the amount ranges for bad debt write-offs change as follows: zero to R$15,000 if they are over 180 days late or R$15,001 to R$100,000 if they are over 365 days late. Lawsuits are required for debts over R$100,000 open for more than 365 days.
Provisions for doubtful accounts in the year ended December 31, 2025 were 1.9% of the total gross revenue.
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Our Markets of Operation
After signing the unified term on April 11, 2025, we began offering, under the authorization regime, fixed-line telephone pay TV, mobile voice and broadband services throughout Brazil. In addition, we also offer a variety of value-added services, some of them through commercial partnerships.
Area Pop. (million) Percent of Brazil’s pop. GDP (R$ million) Percent of Brazil’s GDP Per capita GDP (reais)
São Paulo State 44.4 21.9 % 3,444,814 31.5 % 77,566
Minas Gerais State 20.5 10.1 % 971,978 8.9 % 47,321
Rio de Janeiro State 16.1 7.9 % 1,172,871 10.7 % 73,053
Bahia State 14.1 7.0 % 430,988 3.9 % 30,477
Paraná State 11.4 5.6 % 670,919 6.1 % 58,624
Rio Grande do Sul State 10.9 5.4 % 650,107 5.9 % 59,736
Pernambuco State 9.1 4.5 % 270,475 2.5 % 29,857
Ceará State 8.8 4.3 % 232,239 2.1 % 26,406
Pará State 8.1 4.0 % 254,547 2.3 % 31,348
Santa Catarina State 7.6 3.7 % 513,393 4.7 % 67,460
Goiás State 7.1 3.5 % 336,747 3.1 % 47,722
Maranhão State 6.8 3.3 % 149,227 1.4 % 22,021
Paraíba State 4.0 2.0 % 96,963 0.9 % 24,395
Amazonas State 3.9 1.9 % 161,795 1.5 % 41,048
Espírito Santo State 3.8 1.9 % 209,830 1.9 % 54,733
Mato Grosso State 3.7 1.8 % 273,009 2.5 % 74,620
Rio Grande do Norte State 3.3 1.6 % 101,740 0.9 % 30,805
Piauí State 3.3 1.6 % 80,917 0.7 % 24,736
Alagoas State 3.1 1.5 % 89,689 0.8 % 28,676
Distrito Federal State 2.8 1.4 % 365,669 3.3 % 129,790
Mato Grosso do Sul State 2.8 1.4 % 184,402 1.7 % 66,885
Sergipe State 2.2 1.1 % 60,817 0.6 % 27,519
Rondônia State 1.6 0.8 % 76,456 0.7 % 48,353
Tocantins State 1.5 0.7 % 64,318 0.6 % 42,553
Acre State 0.8 0.4 % 26,291 0.2 % 31,676
Amapá State 0.7 0.4 % 28,020 0.3 % 38,187
Roraima State 0.6 0.3 % 25,125 0.2 % 39,461
Total 203.1 100.0 % 10,943,345 100.0 % 53,887
(1)According to IBGE data (2023) collected at https://www.ibge.gov.br/ – subject to revision.
(2)Average per capita GDP for Brazil, weighted by the percentage of the population represented by each state.
Seasonality
Our business and results of operations are not materially affected by seasonal fluctuations in the consumption of our services.
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Marketing and Sales
Overview
Our commercial distribution network (marketed under the Vivo brand), as of December 31, 2025, consisted of 288 own sales outlets throughout Brazil. In addition, we also have approximately 10,683 sales outlets run by authorized dealers (including exclusive dealers and retail channels), maintaining a solid capillarity strategy that contributed to our leadership position in the Brazilian telecommunications market.
As of December 31, 2025, we had approximately 285,000 points of sale where prepaid mobile service customers could purchase credits using Distribution or Online channels. Prepaid phones can be credited remotely or by purchasing cards containing credits.
We bring our solutions to our customers through the following physical sales channels:
•Vivo Stores: continuing our purpose of bringing new experiences to our consumers, in October 2025 we opened a new store on Oscar Freire Street, one of the most iconic locations in São Paulo. With the goal of seeing without filters, face-to-face, and reminding everyone that life also happens beyond screens, we brought Café Vivo into the store, reinforcing the company’s positioning.
•Exclusive dealers: this channel is made up of selected and certified companies to supply our complete portfolio of products. These resellers constitute an extensive distribution network across the country, with 1,442 stores (as of December 31, 2025) capable of offering our complete portfolio of products and services. It is a channel with significant acceleration in the evolution of the customer experience journey in 2025, equating availability and depth of product stock in each store, as well as payment conditions with other sales channels. Focusing on business sustainability, both for Vivo and its resellers, we promote a constant evolution in the qualification of physical store structures, ensuring standardization and proper adequacy. This measure reinforces our commitment to agile and sustainable management, aimed at creating value and strengthening our foundation for future expansion.
•Retail channel: our retail channel sells prepaid and top-up products that are sold by our partners’ own sales teams. In 2025, we continued attempting to reestablish commercial relationships with the biggest national retail companies with the objective of resuming the channel’s growth.
•Distribution and digital channel: the broadest and most complex sales channel in our markets, allows our prepaid customers to purchase data and voice credits. To be as close as possible to potential and current customers, this channel is made up of accredited agents, lottery outlets, post offices, bank branches and small retailers, such as pharmacies, newsstands, bookstores, stationery stores, bakeries, gas stations, bars and restaurants. In digital, we have banks, fintechs and digital distribution partners. In 2025, this channel kept the majority of our prepaid sales (96%) and top-up revenue (87%) and was responsible for maintain our prepaid market share leadership, achieved in 2020. This was obtained by adopting a strategy of deepening the availability of Vivo SIM Cards at top performing retailers, with support of price-led campaigns.
•Door-to-door sales: this channel continues to strengthen with the growth of the fiber network across the country, consolidating the sales force, focusing on quality and now seeking to totalize our customers with fixed-mobile convergent offers. This is a strategic channel that offers convenience to customers and is suitable for selling telecom services to B2C and B2B customers. The fiber market requires important local knowledge for greater sales penetration and that is why a hunter channel such as door-to-door sales is so important for this segment.
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•Outbound telesales: characterized by the lack of geographical limitations, our outbound telesales channel can reach existing and potential customers across the country, offering possibilities of migration from prepaid to postpaid services in addition to FTTH. This channel focuses on increasing the customer base, identifying new customers and offering suitable plans to our existing customers according to their consumption profile.
Customer experience
In 2025, Vivo consolidated its strategy with a non‑negotiable commitment: putting the customer at the center of everything, because the customer’s time is now. Guided by the principle “Vivo Sempre”, the company remained firmly focused on delivering the best experience to all customers across every touchpoint and that reinforced its value proposition: “Vivo is technological and excellent in quality”, “Vivo is close and solves my needs”, and “Vivo makes me feel special”.
To achieve this goal, the company strengthened its performance across its strategic pillars: providing a single customer view across all channels; resolving customer issues on the first interaction; giving visibility into every step of their journey, proactively keeping them informed; ensuring customers don’t have to repeat their story each time they contact us; anticipating and resolving issues before they arise; and consistently offering self‑service options across digital channels. These pillars translate into innovations that enhance customer experience, such as the new master registration, which gives customers the autonomy to define their contact name across all channels directly through the Vivo App, and the monitoring and quality telemetry systems installed in the modems, enabling proactive remote troubleshooting actions or the dispatch of a technical team when necessary.
This continuous, purposeful, and passionate dedication to the customer is widely recognized by the market. In 2025, Vivo was granted as a three‑time champion in three of the main customer experience awards: Experience Awards (SoluCX) for highest NPS in mobile and broadband, Excellence in Customer Service (Consumidor Moderno), and Best Broadband Services (Estadão). We also won the Gold Trophy in the first edition of the CX Award (Clientes SA) in the IT & Telecom segment and were nominated as the Company that Most Respects Consumers in Mobile Services (Consumidor Moderno). More than awards, these recognitions reflect our essence: always present, always close, always Vivo.
Technology
Voice and data networks
To offer a broader portfolio of integrated services, we have incorporated several technologies into our voice and data networks. In 2025, we strengthened our virtualization program, enabling the offering of 5G SA-based services.
We consolidated offerings based on slice technologies for mobile voice services, advanced in mass adoption with VoLTE, and initiated investments in VoNR (5G SA).
For mobile voice services, we consolidated our digitalization program of voice using VoLTE (Voice LTE) as well as started investing in new technologies like VoNR (5GSA).
For mobile data, we have intensified investments in the 5G SA network, enhancing the customer experience. In synergy with the fixed network, we are reusing Core solutions aimed at improving latency and reducing the amount of data transmitted on our transport network.
For the fixed voice network, we offer VoFTTH (Voice over FTTH) services, SIP trunks, Unified Communications, and SIP interconnections. In addition, we continue expanding our network by deploying fiber optics in cities that already have copper-based voice services, while working on initiatives such as legacy network shutdown, modernization, site decommissioning, voice digitization, and synergies between fixed and mobile networks. We have consolidated our unified IMS core and Session Border Controllers (SBCs) at our access edge and peering edge to support VoIP growth. All these initiatives have enabled savings in terms of energy efficiency, labor, and maintenance costs.
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The IP Backbone is a strategic asset to meet customer demands and support the development of a large number of services, such as:
–Expansion of 5G, IOT, VoD, Live Events.
–Development of cloud,
–Expansion of fiber optics to customer homes,
–Migration of voice and television services to IP,
For all of this, the IP Backbone must be robust, providing high availability, performance, cost-effectiveness, and high bandwidth at the same time. However, as more bandwidth is offered to customers, the need to bridge the gap between revenues and investment to cope with greater traffic becomes increasingly clear. To achieve this goal and increase revenues, the following actions have been implemented over the last few years:
•Modernization and Simplification of the Network—This initiative began in 2018 through the replacement of existing routers with new routers with higher capacity, which enabled the consolidation of specialized routers, thereby reducing network layers and transforming our backbone into a multi service network. This new design accommodates service evolution, as voice, messages, and circuits become data packets, reducing the need for incremental capacity increases.
•Bringing services and content nearer to customer—We believe that in the coming years, layer simplification could allow us to bring content even further to the edge, improving costs and quality at the same time. The foregoing actions are expected to optimize investment in an aggressive traffic increase context and lay the groundwork to deliver the next step in data services quality. Even though bandwidth has been the main technical advantage for several years, latency will take over as the main broadband selling point. To reduce network latency means delivering more responsive services and obtaining higher customer satisfaction. To achieve this result, we believe service should be decentralized and delivered closer to the edge of the network and to customers, which we have taken steps toward by expanding the use of caching solutions throughout the network, making content locally available to our customers, and reducing traffic costs while strongly improving the user experience without increasing access investments.
•Use of high-speed interfaces in the core (400G, 800G) – this allows to optimize the resources and reducing costs by Mbps in the IP Backbone Core.
•Evolution to SDN (Software Defined Network) – we began implementing SDN in 2025 to seek greater flexibility, agility, and reliability for the network.
We further optimized costs by sharing access networks with other Brazilian operators, in which IP backbones played a key role in connecting and transporting traffic among different operator’s networks, reducing the need for mobile sites expansion. The implementation of IPv6 was important to ensure full connectivity for our customers and to support sales, allowing us to continue expanding our customer base. Finally, we have a solid Carrier Grade Nat solution (CGNAT) already developed for the mobile services, which will be extended to fixed-line services along the next years as an additional solution.
LAN – Local Area Network
In our Telecom Data Centers, the Local Area Network (LAN) structure provides connectivity for platforms and servers on both the Fixed and Mobile networks. The local network is the access point for all services and provides connectivity to the IP BackBone.
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In 2025, we maintained the strategy of evolving the TRILL model into the Spine & Leaf model. We have moved from a 3-layer architecture model (Core-Aggregation-Access) to a 2-layer model (Spine & Leaf). The new model is a technological evolution that provides even greater resilience in the local network than TRILL. In addition to greater resilience, we can leave the architecture with one less layer, which means simplifying the network and reducing implementation costs. With the new Spine & Leaf architecture, we maintain the concept of decentralization in Telecom Data Centers. Just like TRILL, Spine & Leaf also uses Top of Rack (TOR) and End-of-Row (EOR) switches, allowing cost savings on structured cabling, reduction of energy, space and cooling. In 2025, we expanded the ports and took the opportunity to change technology from TRILL to Spine & Leaf Technology in three existing sites.
In 2025, we reinforced our CDN strategy to deliver a superior customer experience and optimize backbone performance. We continued deploying local caching solutions to reduce IP backbone bandwidth consumption and minimize latency, ensuring seamless delivery of high-quality content across multiple devices and screens. This approach supported the growing demand for interactive applications and rich media experiences, including large-scale live streaming events where stability and low latency are critical. Throughout the year, we worked closely with strategic partners to expand cache capacity, refresh infrastructure, and implement advanced optimizations that improved traffic distribution and resilience.
In parallel, we enhanced peering connections with key networks, reducing transit dependency and improving end-to-end performance for apps, streaming, and multi-screen content. These initiatives also strengthened Fixed and Mobile Broadband services for both B2B and B2C customers, delivering faster, more reliable connectivity and optimized content delivery. Our design principle of using standalone switches for cache clusters remained essential for operational simplicity and scalability. Overall, these actions contributed to better resource utilization, lower operational costs, and a consistent quality of experience across diverse platforms and content types. In 2025, we will increase capacity at 14 existing sites due to the increase in data traffic.
Network Security
Network security is an essential element for the continuity of our operations and the provision of services to our clients, in a context where telecommunications networks are becoming increasingly complex, distributed, and interconnected. As a result, we are exposed to risks related to the integrity, availability, and confidentiality of our network infrastructures and associated systems.
Our approach to governance, risk management, and compliance related to network security is aligned with the group's guidelines and policies and is based on widely recognized market frameworks, including information security controls. We continuously seek to enhance our capabilities for protecting, detecting, and responding to security incidents, considering the ever-evolving nature of cyber threats.
Throughout our ongoing efforts to strengthen network security, we have implemented and enhanced controls focused on perimeter protection, mitigation of Distributed Denial of Service (DDoS) attacks, and operational resilience, aiming to reduce the likelihood and impact of incidents that may affect service continuity. We also promote the consolidation and evolution of existing tools and processes, as well as the gradual adoption of new solutions aimed at supporting threat intelligence activities, vulnerability management, and data protection.
Additionally, we strive to strengthen our organizational capabilities by developing and training technical teams involved in the design, implementation, and operation of security solutions, with a focus on incorporating security principles from the early stages of product and service development. In this context, we adopt secure development practices and methodologies that aim to integrate security requirements throughout the software and digital services life cycle.
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As part of our risk identification and assessment processes, we conduct periodic internal exercises, such as simulations and controlled tests, to evaluate our incident response capability and identify opportunities for improvement in our security controls and procedures. These exercises aim to contribute to the continuous enhancement of our cybersecurity resilience and defensive capabilities.
Despite these efforts, we cannot assure that our network security measures will be sufficient to fully prevent, detect, or mitigate all security risks or incidents. Failures, vulnerabilities, or successful attacks may occur and result in adverse impacts on our operations, service quality, financial condition, and reputation.
TV services
We offer IPTV services through our FTTH network using an open platform created to revolutionize the delivery of these services. Our open platform consists of Pay TV, with video broadcasting over IP. Several global partners have developed modules in partnership with us to connect to our existing global video platform. Our local team customized the middleware for set-top boxes to create a standardized version that provides better time-to-market for new developments and product launches, as well as enabling future convergence between IPTV and OTT platforms.
We integrated various components to create a new IPTV ecosystem, including instant channel switching, retransmission, and applications that enhance user experience. Additional services such as pay-per-view and Video on Demand (VoD) are also available.
Furthermore, our IPTV interface was completely redesigned to improve customer experience, and the product was renamed to Vivo TV. In 2025, we introduced new regional channels to the service lineup via streaming and implemented low latency encoding to enhance the customer experience with live sports events.
Mobile coverage
In 2025, we continued to expand the capacity and coverage of our mobile networks to absorb continuous growth in voice and data traffic. We seek to set ourselves apart from our competitors by significantly growing our 4G and 5G coverage. As of December 31, 2025, our mobile network covered 5,083 municipalities in Brazil using different technologies such as 5G, LTE Advanced Pro, LTE, WCDMA and GSM/EDGE digital technologies, or 91.26% of the total municipalities in Brazil and 98.1% of the Brazilian population. We have the biggest LTE Advanced Pro (commercially known as 4.5G) coverage in Brazil (with 4,141 municipalities and 93.3% population covered). In the same period, we have covered 716 municipalities of Brazil with 5G SA and NSA; these cities together represent 67.7% of the Brazilian population.
Since 2015, we started developing network sharing on the 2600 MHz 4G band with other operators; we had coverage in 220 cities using TIM’s network through RAN sharing. In 2017, we also began to develop 3G network sharing with Claro and, as of December 31, 2025, we covered 232 Brazilian cities using shared radio base stations and 137 cities using Claro’s network through RAN Sharing. In 2018, we further began to develop 3G network sharing with TIM, and, as of December 31, 2025, we covered 17 Brazilian cities with shared radio base stations and 27 cities using TIM’s network through RAN sharing. In 2019, we began to develop network sharing in 4G 700 MHz with TIM (as a proof of concept), and, as of December 31, 2025, we covered 10 Brazilian cities with shared radio base stations and 9 cities using TIM’s infrastructure through RAN sharing. In 2019, we entered into a network sharing agreement with TIM for 2G, 3G and 4G technologies, which sought to expand our network and create synergies. As of December 31, 2025, we covered 363 Brazilian cities with shared 3G/4G radio base stations and 353 cities using TIM’s infrastructure through RAN sharing. From 2021 until December 2025, 3G/4G Single Grid was deployed in the urban area of 238 cities by Vivo and 238 cities by TIM. Also in 2025, 2G Single Grid was deployed in 1,054 cities by Vivo and 780 cities by TIM aiming to accelerate the switch-off of legacy networks. RAN network sharing allows us to fulfill the ANATEL obligations that were imposed on us as part of our spectrum acquisitions and reduces network deployment and maintenance costs to provide additional coverage at lower costs.
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Fraud detection and prevention
During 2025, we continued our efforts to combat fraud, focusing on the two main types, as follows:
•Subscription fraud: This type of fraud occurs when one or more services are provided without the consent of the true “owner,” with the primary goal of acquiring products and services, causing financial losses. In 2025, we recorded a 40% reduction in fraud-related losses, decreasing from R$85.5 million in 2024 to R$51.2 million in 2025, mainly due to actions focused on prevention in Fixed B2C FTTH. Other additional actions that contributed to this reduction included the identification of new fraud scenarios through investments in security layers and anti-fraud intelligence rules, which allowed us to detect larger volumes of fraud in less time (through biometrics, device behavioral analysis, fraud detection and prevention tools, machine learning rules, among others), as well as continuous improvement of existing rules and the ongoing review of prevention and detection processes.
•SIM Swap Fraud: this type of fraud is characterized by the alteration of the SIM card (ICCID) without the authorization or knowledge of the line holder. Its purpose is to use the line to generate irregular traffic through national, international, and roaming calls, as well as to criminally access customers’ personal information, which often has value in cases of extortion, theft, and online scams. We had a 47% increase in cases in 2025, rising from 365 cases in 2024 to 537 in 2025. This increase was related to identified systemic vulnerabilities and accesses by unauthorized profiles, whose mitigation actions, such as mandatory biometrics and process improvements, were addressed and prioritized.
Awareness campaigns were carried out, constant updates to parameters and rules were made, and the root cause was identified for better detection, prevention, and handling of fraud.
Operating Agreements
Interconnection agreements
The terms of our interconnection agreements include provisions with respect to the number of connection and signaling points. See “—Regulation of the Brazilian Telecommunications Industry—Interconnection Fees” and “Item 4. Information on the Company—B. Business Overview—Rates, Taxes and Billing—Interconnection fees.” We believe that we have adequate interconnection agreements with fixed-line and mobile operators necessary to provide our services and that we have all the necessary interconnection agreements with long-distance carriers.
Roaming agreements
We provide international GSM roaming in over 200 destinations worldwide by means of over 500 roaming agreements with local service providers.
We have a roaming agreement with MTN Irancell, or Irancell. During 2025, we recorded US$17.13 in roaming revenues and zero expenses payable to Irancell under this agreement. See “—C. Organizational Structure—Disclosure Pursuant to Section 219 of the Iran Threat Reduction and Syria Human Rights Act” for further information.
Network sharing agreement
In December 2019, Telefônica Brasil and TIM entered into two network sharing agreements regarding electronic equipment and mobile sites on 2G, 3G and 4G networks, in order to (i) decommission outdated technology; (ii) 4G coverage expansion; and (iii) gain spectrum and cost-efficiency. Both agreements were approved by ANATEL and CADE. In August 2024, Telefônica Brasil and TIM signed two amendments with the aim to expand the number of cities covered by both the agreements. The amendments were submitted for regulatory approval by ANATEL and CADE. On October 22, 2025, CADE granted partial approval, in accordance with the applicable concentration control agreement. The matter remains under Anatel’s review and is pending final approval.
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In December 2020, Telefônica Brasil and Claro S.A entered into a network sharing agreement in which the parties had agreed to share 81 of our mobile sites with Claro. The agreement was approved by ANATEL and CADE.
The approval of the aforementioned agreements, however, does not exempt the providers from fulfilling their obligations, nor from the coverage of the entire area. In the case such agreements are terminated before the expected deadline, each provider must meet its coverage commitments with its own network, under the penalty of extinction of the use of radio frequencies’ authorizations.
See also “—Mobile coverage” above for further information on our network sharing.
Competition
Competition in the fixed and mobile markets continued to be intense in 2025. Faced with the high demand for connectivity, Brazilian telecoms have focused on modernization and innovation as levers to remain competitive in the market. The leading companies have been directing efforts and investments toward the digital transformation of business operations, aiming to improve the balance between customer growth and loyalty, revenue growth and margins. For these reasons, the major operators accelerated the 5G coverage, rolled out fiber and continued to include value-added services in the offers in order to differentiate their mobile and fixed portfolios. In addition, telecommunication companies began to leverage their customer base, billing and other key assets to engage in other revenue streams, alone or in partnerships with companies from other sectors. The initiatives remain in their initial steps and range from financial services, to healthcare, education and B2B solutions.
The Brazilian consumer market is increasingly knowledgeable and demanding, expecting not only the best service delivery, as well as the best cost-benefit. Therefore, operators have prioritized the expansion and digitalization of company-customer interactions.
In the mobile market, we continued to lead in market share, with a 38.1% share according to information from ANATEL as of December 31, 2025. This year, the competition remained intense in 4.5G and 5G network coverage expansion and subscriber growth.
We lead the mobile market in 13 states: Amapá, Amazonas, Bahia, Ceará, Espírito Santo, Mato Grosso, Mato Grosso do Sul, Minas Gerais, Pará, Rio Grande do Sul, Roraima, São Paulo and Sergipe. Claro Brasil or Claro is a mobile operator controlled by the Mexican company America Móvil Group, and leads mobile service in nine states: Acre, Distrito Federal, Goiás, Maranhão, Piauí, Pernambuco, Rio de Janeiro, Rondônia and Tocantins. TIM, a Brazilian telephone company and a subsidiary of Telecom Italia, leads the mobile market in five states: Alagoas, Paraná, Paraíba, Rio Grande do Norte and Santa Catarina (according to ANATEL as of December 2025).
On the fixed-line services, the wireline and pay-TV services reported net disconnections, according to ANATEL. In broadband, the market continued to expand mainly in ultra-broadband, fiber accesses. Our main competitors in fixed telecommunications services are Claro (which includes its Claro and Embratel services) and Nio, which is stronger in the fixed-line services outside the State of São Paulo. TIM (a subsidiary of Telecom Italia) also offers fixed broadband services, while SKY, which is currently controlled by the Argentine conglomerate Werthein, has pay TV and broadband services (4G LTE TDD). In addition, we have competition from thousands of regional service providers throughout Brazil.
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Environment, Social and Governance
In 2025, Telefônica Brasil continued to strengthen its purpose of ‘Digitalize to Bring Closer’ through its strategic pillars, including ‘Futuro Vivo’ (Vivo Future) pillar, which integrates digital transformation sustainability. This approach reinforces actions aimed at driving technological innovation with a focus on environmental and social responsibility, generating positive impacts for society and the planet. This ESG strategy is monitored through more than 100 indicators consolidated by the Board of Directors through the Quality and Sustainability Committee, via the Responsible Business Plan (PNR, its acronym in Portuguese), with targets for 2025–2027 aligned with the Sustainable Development Goals (SDGs).
This strategy is deployed through internal structures that ensure its dissemination across the organization, including specific committees for ESG agendas with senior management: (a) Quality and Sustainability Committee which reports to the Board of Directors an includes independent members of the Board of Directors and (b) Sustainability Committee, which reports directly to the CEO and the Executive Directors. As of December 31, 2025, our Board of Directors was comprised of 83% independent members and 33% women.
ESG commitments are included in variable compensation. Since 2019, 20% of short-term executive and employee compensation has been linked to ESG targets, currently associated with customer perception (NPS), gender equality (women in leadership) and climate change (GHG emissions). Since 2022, executives’ long-term Performance Plan includes Telefônica Brasil (VIVT3) with cash settlement. The incentive has clawback rules and 10% of compensation linked to ESG targets related to climate change and gender equality.
Our Climate Strategy is presented in the Climate Action Plan, a document approved by the Board of Directors and overseen by the Quality and Sustainability Committee. In line with commitment to achieve net zero emissions by 2035—five years earlier than previously planned—we have implemented actions focused on three main areas:
•Mitigate impact: since 2023, we have maintained a 90% reduction in greenhouse gas (GHG) emissions (scope 1 and 2), consistent with the objectives of our Net Zero plan. To achieve this, we have adopted strategies such as: reducing fuel consumption, fusing renewable fuels in our fleet, investing in electric vehicles, modernizing air conditioning systems, implementing leak controls and replacing of some refrigerant gases, low-carbon purchasing, and sourcing 100% of the electricity from renewable sources. Telefônica Brasil also operates a Renewable Energy Plan and an Energy Efficiency Program, with highlights to the Distributed Power Generation program, which gradually install solar, hydro and biogas power plants across Brazil. Since 2019, we have offset 100% of operational emissions through carbon credits that prevent deforestation and restore Brazilian forests. Through the Supply Chain Engagement Carbon Program, we engage carbon-intensive suppliers to measure and manage emissions, seek reduction alternatives, and make a voluntary climate commitment, contributing to our Scope 3 reduction target.
•Leverage Opportunities: digital solutions have the potential to decarbonize various value chains. In the B2B segment, through GUD Energia, we facilitate access to renewable energy sources such as hydroelectric, wind and solar, generating financial and environmental benefits for companies seeking to optimize their costs and meet sustainability challenges. We also offer products and services with the Eco Smart seal, verified by a third party, which allows companies to know the environmental benefits that the solution can generate.
•Adapt to Risks: climate risks are integrated into our overall risk assessment, with periodically qualitative and quantitative evaluations considering the physical and transition risks. We maintain a Global Crisis Management System to address high impact threats, covering of 100% of nationwide critical operations.
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As part of Telefônica Brasil’s biodiversity strategy, in 2025, we launched the “Floresta Futuro Vivo” project, reinforcing its commitment to biodiversity. In partnership with re.green, a leading reference in large-scale ecological restoration, the initiative aims to recover and protect approximately 800 hectares of forest within the Gurupi-Turiaçu Mosaic, located between Maranhão and Paraná, with the regeneration and conservation of 900,000 trees from 30 native species over the next 30 years. The initiative seeks to reconnect forest fragments, restore ecological functions, and protect endangered species such as the Ka’apor capuchin monkey (Cebus kaapori). The restoration process involves applied science and combines natural regeneration, seed collection, and monitoring technologies to track seedling growth. In addition, the project is expected to generate around 116,000 tons of carbon credits, reinforce the Company’s decarbonization strategy.
Since 2006, collection points for the proper disposal of electronic waste have been offered through the Vivo Recicle Program, which has already collected millions of items. In 2025, through our partnership with Fundação Telefônica Vivo, a game between students was held in public schools and institutions, collecting about 29 tons of electronic waste and involving 24,000 children, young people, and teachers. Through the Vivo Renova Program, customers receive discounts for exchanging their cell phones upon delivery of the used device, which can either be resold (extending its useful lifecycle) or disposed of properly. In the fixed-line business (broadband, voice, and TV), customers can schedule home collection or return their used modems or decoders at our stores, where they are refurbished and reused or recycled. As part of our circular economy strategy, we aim to achieve zero waste from operations by 2030, prioritizing the reuse, repair, recycling and reduction of waste material. In addition, we have set a long-term goal to collect a total of 375 tons of electronic waste by 2035.
Digitalization promotes social inclusion and efficiency in the use of environmental resources. To enhance these benefits, we invest in strengthening our mobile network and expanding our fiber network. A range of solutions are offered in areas such as health (Vale Saúde), education (VivaE), banking and access to credit (Vivo Pay) and renewable energy (GUD Energia). These areas are also supported through Corporate Venture Capital (CVC) funds: Wayra, focused on early-stage startups, and Vivo Venture, focused on growth startups.
Digitalization is also part of the purpose of Fundação Telefônica Vivo focuses on contributing to digital inclusion and the development of digital skills for educators and students in Brazilian public schools. To this end, we offer continuing education programs, with an emphasis on technology and mathematics, for educators working in early school years. In addition, we support the expansion of technical and vocational education in technology within the public school system contributing to the employability of technical high school students. We participate in movements and coalitions that discuss and promote systemic strategies and public policies with the government, aiming to expand the inclusion of digital technologies in education. Racial equity is a cross-cutting theme in all our initiatives and projects. We also promote Corporate Volunteering, an initiative that sensitizes and engages Vivo employees in in-person and digital activities that generate social impact. More than 2 million people have benefited from these actions.
We have actions to attract and retain talent and invest in employee training, including technical certifications and subsidies for professional specialization. Processes for performance evaluation, talent mapping and identification of successors are also implemented. Our diversity program focuses on four groups: Gender, Race, LGBTI+ Community and People with Disabilities, as well as other topics covered in our Global Diversity and Human Rights Policy. We are committed to setting goals to these groups with actions such as: affinity groups, mentoring, development programs, recruitment practices and literacy initiatives. In line with long-term commitments, we aim to achieve by 2035: 40% women in senior leadership position, 45% women in executive leadership positions, 40% black professionals in leadership positions, and 45% black representation across the company. To support these objectives, 50% of trainee, internship and young apprentices positions are allocated to black candidates. Another highlight is Women in Fiber (Mulheres de Fibra) program, which promotes female participation in technical areas that were previously dominated by men.
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In addition, the Telefônica Responsible Business Principles establish the core values applicable to all employees, suppliers and other stakeholders. Human rights aspects are monitored through biannual risk assessments, in accordance with the Telefónica Group’s Enterprise Risk Management process. For suppliers, the Parceiro Plural program was launched to, and ensure that partners share the same values as the company in regarding ESG issues and to promote continuous development.
Our commitment to ethics, integrity and transparency is reinforced through the Compliance Program (#VivodeAcordo) and the Privacy and Data Protection Governance Program (#VivoCuidandodaPrivacidade). Customers can access more detailed information about their rights and our personal data management practices through the Privacy Center website and the local Privacy Notice.
The digital security strategy is monitored by senior management through: (a) a dedicated management structure with a Chief Security Officer (CSO) and a Chief Information Security Officer (CISO), (b) a Digital Security Risks Executive Committee, and (c) the periodic review of the digital security strategy by a Board of Directors’ independent director. Several cyber risk management actions are applied, such as annual cyber war games and training initiatives.
Aligned with best practices, we maintain significant standards and certifications: ISO 26000 (Social Responsibility), ISO 14001 (Environmental Management), ISO 27001 (Information Security), ISO 45001 (Occupational Health and Safety), ISO 50001 (Energy Management and DSC 10000 (Compliance).
Our strategy enabled Telefônica Brasil to be included in the Dow Jones Best-in-Class World Index, remaining the only Brazilian telecom company in the index, the leader in the Americas and among the best-performing companies in the sector worldwide. The Company is recognized as a leader in the Corporate Sustainability Index (ISE B3) and is ranked among the Top 10% in The Sustainability Yearbook 2025.
Additional information on our ESG strategy and actions are detailed in our Annual Integrated Report, available at: https://ri.telefonica.com.br/en/esg/sustainability-reports. The information on our website is not included or incorporated by reference in this annual report on Form 20-F.
Regulation of the Brazilian Telecommunications Industry
Our business, including the services we provide and the rates we charge, is materially affected by comprehensive regulation under the General Telecommunications Law and various administrative rules thereunder. We operate under authorization agreements for voice, mobile, data and Pay TV services in all Brazilian states. See “Item 3. Key Information—D. Risk Factors—Risks Relating to Our Business and Industry—Our authorizations contain certain obligations, and our failure to comply with these obligations may result in various fines and penalties being imposed on us by ANATEL.”
ANATEL is the regulatory agency established by the General Telecommunications Law and is administratively and financially independent from the Brazilian government. Any proposed regulation by ANATEL is subject to a period of public comment and, occasionally, public hearings, and its decisions may be challenged in Brazilian courts.
Concessions and authorizations
In accordance with the General Telecommunications Law, concessions are licenses to provide telecommunications services granted under the public regime, while authorizations are licenses to provide telecommunications services granted under the private regime.
Both concessions and authorizations licenses are subject to several obligations regarding, for instance, quality of service, as well as network expansion and modernization. Nonetheless, companies that provide services under the public regime, known as the concessionaires, are subject to additional obligations as to continuity and universality of service.
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On October 4, 2019, the New General Telecommunications Law was enacted. This law revises the telecommunications regulatory framework and represents a significant impact on this industry. For more information about the New General Telecommunications Law, see “—Other regulatory matters—Updated regulatory framework.”
On April 11, 2025, Telefônica Brasil signed the unified authorization term with ANATEL, that compiles all previous licenses into one single title, finalizing the migration to the authorization regime.
Obligations of telecommunications companies
Under the authorizations framework, we and other telecommunications providers must comply with obligations related to service quality, network expansion, and modernization.
Failure to comply with telecommunications regulations or any obligations established by ANATEL may result in fines of up to R$50 million per infraction.
As of the date of this annual report, our operations are regulated as follows:
•Local and long-distance fixed-line voice services (or STFC services). We operate under a nationwide authorization;
•Mobile voice and mobile broadband services, in all 26 states and the Federal District, under the personal mobile service (Serviço Móvel Pessoal – SMP) authorizations;
•Fixed broadband and Multimedia communication services, such as audio, data, voice and other sounds, images, texts and other information throughout Brazil. We operate under a nationwide SCM authorization, valid for an indefinite term;
•Pay TV services, throughout all regions of Brazil under the conditioned public service (Serviço de Acesso Condicionado), or SeAC authorization. We operate a SeAC authorization, which is valid for an indefinite term;
•Private Limited Services – SLP, which accounts for the provision of telecommunication services in the private regime, intended for network building and specific groups of users defined by the provider and which covers multiple applications, including data, video, audio, voice and text communication; and
•Wholesale services, such as interconnection, governed by the interconnection agreements discussed under “—Operating Agreements—Interconnection Agreements,” Roaming and MVNO agreements, which are described under “—Operating Agreements—MVNO Agreements” (Interconnection and Roaming are also regulated by the Competition Goal General Plan (Plano Geral de Metas de Competição), hereinafter referred to as PGMC.
We set forth below details of the authorizations, licenses and regulations that regulate our operations.
Quality regulations in Brazil
In December 2019, ANATEL approved RQUAL, which changes the way the agency monitors the performance of telecommunications operators. In addition to promoting quality indicators increasingly associated with consumer experience and the widespread dissemination of results, the concept of responsive regulation was introduced, encouraging advanced corrective actions to address problems rather than solely imposing fines when goals are not met.
Annual “seals” from “A” to “E” in each municipality, state, and Brazil will be awarded with quality measurements based on three indices: technical quality of service, perceived quality, and user complaints. If a provider experiences a deterioration in a municipality, resulting in a seal of “D” or “E” compared to the previous year, customers may terminate their contracts without paying loyalty penalties.
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An independent entity, the ESAQ, inspected by ANATEL and funded by the providers, measures the quality of services. All measurements are based on a document called the DVR (Reference Values Document), which is issued following RQUAL and reviewed every two years. The actual version of DVR was published on December 27, 2024, and was applied to measurements beginning in 2025. The first seals were published in December 2025.
Mobile services
In October 2016, ANATEL approved new spectrum use regulations, which facilitate access to radio frequencies and generates efficiency in its use, due to the simplification of procedures and necessary documentation. The regulation also alters spectrum pricing (for non-bidding grants), rules for extending use authorization and new rules for frequency use on a secondary basis prior to primary use.
In July 2018, ANATEL approved Resolution No. 695, which establishes new spectrum pricing regulations, with calculation methods and conditions for spectrum reserve prices and renewal costs. This new regulation took effect in May 2019.
In November 2018, ANATEL approved Resolution No. 703, which establishes new spectrum cap regulation. There are two groups of bands with specific limits for a given area:
•Frequencies up to 1 GHz: each operator may hold up to 35% of the bands;
•Frequencies between 1 GHz and 3 GHz: each operator may hold up to 30% of the bands.
These limits can be extended by up to 40%, through competitive constraints that may be imposed by ANATEL. For frequencies above 3.0 GHz, the limits were determined in the specific auction terms as follows:
•3.5 GHz frequency (between 3.3 and 3.7 GHz): each operator may hold up to 100 MHz of the band;
•26 GHz frequency (between 24.3 GHz and 27.5 GHz): each operator may hold up to 1 GHz of the band.
In November 2023, ANATEL conducted a public consultation to revise the Spectrum Usage Regulation (“RUE”), approved by Resolution No. 671/2016. According to the proposal, Resolution No. 695/2018 would be revoked, and the regulations associated with the valuation of radio frequency spectrum usage authorizations would be consolidated in the new RUE. Additionally, the proposal alters the conditions for authorizations to use spectrum on a secondary basis. The new regulation is expected to be approved in the first half of 2026.
In December 2025, ANATEL approved Resolution No. 785/2025, which stipulated a long-term plan for spectrum auctions (between 2026 and 2036).
Mobile service licenses (SMP)
Previously, spectrum authorizations were valid for 15 years and could only be renewed once. Although the recently approved New General Telecommunications Law permits successive spectrum renewals, we cannot guarantee that our existing licenses will be renewed.
According to the New General Telecommunications Law and to Decree No. 10,402/2020, ANATEL must consider specific conditions for the renewal of our existing licenses on the grounds of efficient spectrum use, competition issues or public interest.
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Our current 850 MHz authorizations will expire in 2028. In November 2020, ANATEL has decided to renew our current authorizations for the use of radio frequencies in A band, on a primary basis, until November 29, 2028. However, the specific conditions for renewal, including those related to economic valuation criteria and related obligations, were challenged by the affected service providers, including us. After ANATEL rejected complaints presented by the providers, a final disposition of the matter is still pending and will require a decision by the TCU.
In April 2023, ANATEL determined that our authorizations in the 900 MHz band should not be extended (except in the state of Minas Gerais), claiming that the efficient use of this spectrum had not been properly demonstrated, since the low capacity associated this band (2.5 + 2.5 MHz) imposes limitations on its effective use. The non-renewal of these 900 MHz licenses, however, does not affect the services currently provided by the Company. Also in April 2023, ANATEL decided to renew our 1,800 MHz licenses until 2032. In August 2023, ANATEL further renewed our 900 MHz and 1,800 MHz licenses in part of the state of Minas Gerais (PGO sector 2) until 2032. It is worth noting that our licenses in the remaining parts of the state of Minas Gerais (PGO sector 3) had already been renewed by ANATEL in April 2020 and are set to expire in 2035.
Furthermore, in April 2023, ANATEL decided to renew our current license authorizations for the use of 2,100 MHz radio frequencies until April 2038.
As these were first-time renewal requests provided for in the contracts and bidding processes that originally granted these authorizations, TCU’s technical division did not identify evidence of non-rational or inappropriate use of these bands by the Company that would justify denying the extensions. However, they highlighted the need to adapt Article 31 of Resolution No. 757/2022 to align with the new proposed maximum validity terms. On February 3, 2025, Resolution No. 757/2022 was revoked by Resolution No. 773/2025, which approved new Regulation for Radio Frequencies Conditions of Use. On February 5, 2025, TCU approved the renewal of 2,100 MHz authorizations, as originally proposed by ANATEL. This approval was formalized through Ruling No. 224/2025 (“Acórdão nº 224/2025 – TCU – Plenário”). If the licenses mentioned above are not renewed, we may be required to compete for new licenses in a spectrum auction.
For authorizations acquired prior to the 5G auction that took place in 2021, their first renewal requires payment of 2% of net operating revenues earned in the region included in the authorization, every two years for the duration of the extension period. For some licenses, we must also pay 1% of the aforementioned amount in the 15th year.
For subsequent periods and all other authorizations, ANATEL determined that the amount due for the extension must be calculated based on net present value (“NPV”) parameters, in order to reflect, according to the Agency, the real economic value (market value) of the sub-bands. In addition, part of the payment should be converted into investment commitments.
It should be noted that, according to the TCU's interpretation of Law No. 13,879/2019, requests for extension must be assessed from the perspective that a new spectrum bidding is the rule and that, if ANATEL intends to approve the extension requested by the provider, it must prove compliance with the conditions set forth in Decree No. 10,402/2020. In this context, ANATEL admitted the second extension of the 900/1800 MHz (in Minas Gerais) and 850 MHz (several states) bands, currently under evaluation by the TCU.
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Our SMP authorizations include the right to provide mobile services for an unlimited period but restrict the right to use the spectrum according to the schedules listed in the respective radiofrequency authorizations. The table below sets forth our current SMP authorizations, their locations, band and spectrums, date of issuance or renewal and date of expiration:
Region Frequency Bandwidth (MHz) Notes Year of Exp. Date Notes
Brazil(1) 700 MHz 20 2029
Brazil(1) 850 MHz 25 (2) 2028 (3)
Brazil(1) 900 MHz 5-10 (4) 2031–2035 (5)
Brazil(1) 1.8 GHz 20-80 (6) 2031–2035 (5)
Brazil(1) 2.1 GHz 30-60 (6) 2038
Brazil(1) 2.3 GHz 40–50 (7) 2041
Brazil(1) 2.5 GHz 40 (8) 2027–2031 (9)
Brazil(1) 3.5 GHz 100 2041
Brazil(1) 26 GHz 600 2041
(1)Telefônica Brazil uses high and low frequencies spectrum in all regions of Brazil.
(2)States of Acre, Amazonas, Amapá, Bahia, Distrito Federal, Espírito Santo, Goiás, Maranhão, Minas Gerais, Mato Grosso do Sul, Mato Grosso, Pará, Paraná, Rio de Janeiro, Rondônia, Roraima, Rio Grande do Sul, Santa Catarina, Sergipe, São Paulo, and Tocantins (except for PGO Sectors 3, 22, 25, 30 and 33).
(3)Current licenses expire in 2028. ANATEL decided to limit their renewal up to 2028, due to a future mandatory refarming process.
(4)10 MHz in the State of Minas Gerais; 5 MHz in the States of Amazonas, Roraima, Amapá, Pará, Maranhão, Bahia, Sergipe, and São Paulo (except municipalities within area code 11).
(5)Regional licenses: expiration and renewal dates depend on the region.
(6)Bandwidth varies by region.
(7)50 MHz in the southeast region of Brazil (except for the state of São Paulo and PGO Sector 3); 40 MHz in the state of São Paulo (except for PGO Sector 33); and in the north and mid-west regions of Brazil (except for PGO Sectors 22 and 25).
(8)40 MHz is the most common bandwidth, but such bandwidth can rise up to 60 MHz in some regions.
(9)Band X will expire in 2027 and Band P will expire in 2031.
In 2013, we changed the terms of our authorizations regarding Band “L” (1.9 GHz) in certain locations, adapting their blocks of frequencies to 2.1 GHz and aligning them with the Band “J” (3G), which enables more efficient use of the spectrum. In 2018, this alignment process was completed at the national level with respect to the following areas: Northeast region, with the exception of Bahia and Sergipe; Pelotas, Morro Redondo, Capão do Leão and Turuçu, in Rio Grande do Sul; Buriti Alegre, Cachoeira Dourada, Inaciolândia, Itumbiara, Paranaiguara and São Simão, in Goiás; Altinópolis, Aramina, Batatais, Brodowski, Buritizal, Cajuru, Cássia dos Coqueiros, Colômbia, Franca, Guaíra, Guará, Ipuã, Ituverava, Jardinópolis, Miguelópolis, Morro Agudo, Nuporanga, Orlândia, Ribeirão Corrente, Sales de Oliveira, Santa Cruz da Esperança, Santo Antônio da Alegria and São Joaquim da Barra in São Paulo; and Paranaíba in Mato Grosso do Sul. This change is foreseen in the bidding document No 001/2007. We do not have Band “L” in the states of Amazonas, Roraima, Amapá, Pará and Maranhão and in the cities of Londrina and Tamarana, Paraná.
In 2012, Telefônica acquired 40MHz on the 2.5GHz to 2.69GHz frequencies for the amount of R$ 1.05 billion. In order to meet the coverage requirements imposed by ANATEL, we had the obligation of implementing 4G coverage in 1,094 cities by December 31, 2017. The remaining coverage commitments in cities with less than 30,000 inhabitants could be fulfilled with other frequency bands until December 31, 2019. After completing the associated inspection process, ANATEL confirmed our full compliance with such commitments.
Currently, we have made 4G services available in 5,199 municipalities. Telefônica has deployed and continues to deploy 4G coverage by serving its customers through the use of its own network or by established agreements of RAN-sharing approved by ANATEL.
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We also have the obligation to meet voice and data demand in remote rural areas, defined in the bidding process of the 2.6 GHz band. As a commitment, we are required to provide infrastructure and service operating in any frequency band in rural areas in the states of Alagoas, Ceará, Minas Gerais, Paraíba, Pernambuco, Piauí, Rio Grande do Norte, Sergipe, and countryside of São Paulo, for a total of 2,556 municipalities. In these areas, we are also required to provide free broadband to schools located in rural areas.
Regarding the 700MHz spectrum, ANATEL has allocated the band for the provision of fixed-line, mobile and broadband services. On September 30, 2014, we acquired 20 MHz (10+10 MHz) with nationwide coverage, for R$1.92 billion, at the minimum price, plus R$904 million for the band cleaning (migration of broadcasters that currently occupy the band and interference management). According to the auction rules, the winning bidders are responsible for financing and managing the band cleaning process (Analog TV switch off) which was implemented through a legal entity specifically incorporated for this purpose, as set forth in the bidding process and applicable regulations (EAD).
Since June 2019, all Brazilian municipalities are ready to activate LTE coverage in the 700 MHz band. In November 2020, ANATEL attested that 9 out of 17 obligations have been fulfilled by the operators. According to the Agency, the other obligations would either be concluded in 2020 or were linked to activities that still need to be carried out, however, this situation does not imply any type of noncompliance on the part of the operators in relation to what should have been done.
In December 2015, ANATEL auctioned the remaining spectrum lots in the 1,800 MHz, 1,900 MHz and 2,500 MHz bands, from which Telefônica acquired seven lots of 2.5 GHz frequency band offering a total of R$ 185.4 million. These lots are associated with six different States, in the capital cities of the States of São Paulo, Rio de Janeiro, Porto Alegre, Florianópolis, and Palmas, and one countryside city of the State of Mato Grosso do Sul. Such frequencies are already being used for the provision of mobile broadband service on 4G.
In November 2021, ANATEL held the largest spectrum auction in its history, which included 4G and, for the first time, 5G blocks, with 700 MHz, 2.3 GHz, 3.5 GHz and 26 GHz lots. On that occasion, we acquired 3.5 GHz and 26 GHz national licenses (100 MHz and 600 MHz bandwidths, respectively). We also won regional 2.3 GHz licenses, with 50 MHz bandwidth in the southeast region of Brazil (except for the state of São Paulo and PGO Sector 3) and 40 MHz bandwidth in São Paulo state and in the north and mid-west regions of Brazil (except for PGO Sectors 22 and 25). These acquired licenses, which we purchased for a total of R$4.45 billion, of which R$0.93 billion is related to licenses and the remaining amount is related to the obligations ANATEL established. The licenses ensure we have the required spectrum to provide 5G services, and are valid for 20 years (renewable under the then-existing legal conditions at the expiration of this term).
In 2022, as widely reported, the Company acquired part of Oi’s mobile assets, resulting in additional spectrum authorizations in the 900, 1,800, and 2,100 MHz bands. These assets were grouped into a special-purpose entity called Garliava RJ Infraestrutura e Redes de Telecomunicações S.A., which was fully merged with and into the Company in 2023.
Multimedia communication service
Our multimedia services include broadband in several technologies, including fiber services.
We have assumed in the past the obligation to provide free Internet access to public schools in the area comprising in our concession area during the term of our concession agreements. This obligation was terminated in December 2025.
Pay TV services
We are authorized to provide Pay TV Services (Serviço de Acesso Condicionado), or SeAC, throughout Brazil by means of different technologies (Fiber, DTH and coaxial).
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Law No. 12,485/2011 established the most important aspects of this service, including the imposition of minimum national content requirements, carrier obligations and rights and cross-ownership restrictions.
Since 2019, the Brazilian Congress has been discussing bills amending SeAC law. Among the proposals is the review of limitations to cross-control between telecom providers and content producing and programming companies. Regulatory asymmetries between SeAC and OTT services are also under debate.
Interconnection fees
In accordance with ANATEL regulations, we must charge fees to the other telecommunications service providers based on the following:
•a fee for the use of our local, fixed-line service network (the TU-RL): we charge local service providers an interconnection fee for every minute used in connection with a call that either originates or terminates within our local network, with the exception of calls between other providers of local, fixed-line service, for which a fee is not charged;
•a fee for the use of our long-distance, fixed-line service network (the TU-RIU): we charge long-distance service providers an interconnection fee on a per-minute basis only when the interconnection access to our long-distance network is in use;
•a fee for the use of the mobile network (the MTR): we charge mobile service providers an interconnection fee on a per-minute basis only when the interconnection access to our mobile network is in use; and
•a fee for the use of leased lines by another service provider (EILD): we also lease transmission lines, certain infrastructure and other equipment to other providers of telecommunications services.
For more information, see “Item 3. Key Information—D. Risk Factors—Risks Relating to the Brazilian Telecommunications Industry and Us—Our results of operations may be negatively affected by changes to STFC or SMP rules.”
Fixed-line services
In July 2005, ANATEL published new rules on interconnection. The main changes are: (i) an obligation to have a public offering of interconnection for all services, in addition to interconnection fees between providers of fixed-line and mobile telephone services; (ii) an obligation by internet backbone providers to publicly offer interconnections; (iii) the establishment of criteria for the treatment of fraudulent calls; and (iv) a reduction of service times for interconnection requests.
In 2006, we completed the implementation of interconnection with mobile service providers in regions with heavier traffic, ensuring proper billing for such calls. This reduced interconnection costs.
In 2007, ANATEL published a new version of its fixed-line network compensation regulation, which changed the rules used to calculate interconnection fees. Local and long-distance fees, which were hitherto fixed, became variable fees according to the rules for public service fees. A 20% increase was applied to fees for mobile service operators without significant market power in their regions.
On May 7, 2012, ANATEL Resolution No. 588/2012 was published, which set forth the following:
•a maximum of two minutes of interconnection should be paid for the use of the local network on reduced hours;
•a reduction of interconnection fees from domestic and international long-distance calls by 30% of the TU-RL, and a reduction of 25% (until 2012) and 20% (as of 2013) of the TU-RIU;
•The remuneration between networks will not occur until this traffic imbalance is greater than 75% compared to 25%; and
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•The partial Bill & Keep by December 31, 2013 and full Bill & Keep by December 31, 2014.
On July 1, 2014, ANATEL decided to gradually decrease the TU-RL, and the TU-RIU based on a bottom-up cost model by setting maximum rates for fixed-line interconnection fees for the years 2016 through 2019. In December 2018, ANATEL set the fixed-line interconnection fees ranging for the years 2020 through 2023. Further, in March 2023, ANATEL set the new fixed-line interconnection fees ranging for the years 2024 through 2027, as shown in the table below for our STFC sector (Sector 31) in reais):
Interconnection fees for Sector 31
Year TU-RL TU-RIU1 TU-RIU2
2024 0.00598 0.00725 0.00655
2025 0.00604 0.00732 0.00663
2026 0.00610 0.00741 0.00671
2027 0.00617 0.00749 0.00680
In December 2016, ANATEL held a public consultation to discuss a new interconnection regulation (Regulamento Geral de Interconexão). These rules were eventually enacted in July 2018 through Resolution No. 693. The new rules seek to resolve a large number of disputes in agreements for voice and data traffic among telecom companies. In the case of a default, interconnection services can be cut without ANATEL’s prior authorization. In addition, the rule sets forth a list of prohibited practices in interconnection relationships and makes interconnections technology-neutral.
Mobile service
In November 2009, ANATEL unified the licenses of all mobile operators, resulting in the consolidation of interconnection fees and reducing the number of fees for the use of the mobile network from two to one. On July 1, 2014, ANATEL decided to gradually decrease the MTR, based on a cost model for the years 2016, 2017, 2018 and 2019. In December 2018, ANATEL established the reference values for the MTR for the years ranging from 2020 until 2023. Further, in March 2023, ANATEL established the reference values for the MTR for the years ranging from 2024 until 2027, as shown below per region in the General Authorization Plan (Plano Geral de Autorizações), or PGA, in reais:
Year PGA Region I PGA Region II PGA Region III
2024 0.01472 0.01599 0.01738
2025 0.01503 0.01650 0.01779
2026 0.01499 0.01686 0.01779
2027 0.01497 0.01632 0.01804
In addition, on December 2, 2013, Act No. 7,272 was published, which set the MTR reference values for PMS providers and became effective on February 24, 2014. On August 28, 2014, Act No. 7,310 replaced the reference values previously set out in Act No. 7,272. In addition, the PGMC determined that in the relationship among PMS and non-PMS providers in the mobile network, the interconnection fee should be paid only when the traffic out of a network in a given direction is greater than 80% of the total traffic exchanged until February 23, 2015; and 60% of the total traffic exchanged from February 24, 2015 to February 23, 2016. Since February 24, 2016, the MTR is owed to the mobile service provider when its network is used to originate or terminate calls (full billing). These conditions were further modified by ANATEL in February 2015, after public notice and comment. In July 2018, ANATEL amended the PGMC and modified the rules on interconnection fees to be paid for outbound traffic, as follows:
•From January 1, 2013 to February 23, 2015: 80% / 20%;
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•From February 24, 2015 to February 23, 2016: 75% / 25%;
•From February 24, 2016 to February 23, 2017: 65% / 35%;
•From February 24, 2017 to February 23, 2018: 55% / 45%; and
•From February 24, 2018 onwards: 50% / 50%.
In September 2025, ANATEL approved the new PGMC through Resolution no. 783/2025 and kept the Bill and Keep 50%/50% as a rule for PMS providers in their relationship with non-PMS providers.
EILD
On May 18, 2014, ANATEL approved the proposed standard for setting maximum values of Industrial Dedicated Line (EILD), based on Cost Models. Values for EILD were published through Act No. 6212, which contains a single reference table that is valid from 2016 until 2019. In addition, the general competition plan requires companies with significant market power to present a public offer every six months informing standard commercial conditions, which is subject to approval by ANATEL.
On December 17, 2018, ANATEL approved through Act No. 9,920 a revision of the EILD reference table, valid for 2020 onwards.
On March 28, 2023, ANATEL approved through Act No. 3.248 a new revision of the EILD reference table, valid from February 25, 2024 until 2027.
Since the approval of the new PGMC, EILD is no longer a regulated wholesale market, although contracts entered into during the period in which it was must be fulfilled.
Mobile Virtual Network Operator (MVNO)
In 2001, ANATEL approved rules for companies to be licensed as MVNOs. In 2016, ANATEL authorized MVNO companies to be affiliates of other certain network operators, and for that reason, we have signed agreements with companies authorized to operate as an MVNO in Brazil. Brazilian MVNO regulations allow two operating models: “authorized” (in which MVNO holds its own SMP authorization but operates under an MNO’s network) and “accredited” (in which the company doesn’t hold an SMP authorization and acts as an MNO’s representative and offers services jointly). In August 2019, ANATEL held a public consultation about regulatory barriers to IoT expansion and proposed changes in MVNO regulations. Furthermore, in November 2020, ANATEL Resolution No. 735/2020 reduced regulatory restrictions on the “accredited” model, and permitted the representation of multiple MNOs and gave more autonomy in the use of network agreements.
In November 2023, ANATEL published a public consultation dedicated to updating the PGMC in which the MVNO, as a wholesale product, is considered a relevant market. As of the end of the public consultation, the updated PGMC was published in September 2025, with ANATEL determining that the MVNO, as a wholesale product, should not be considered a relevant market. Consequently, the parties remain free to negotiate the terms of their MVNOs agreements, while still complying to the current regulations on the subject, including Resolution No. 777/2025.
Internet and related services in Brazil
In Brazil, internet service providers, or ISPs, are deemed to be suppliers of value-added services and not telecommunications service providers. ANATEL requires SCM operators to act as carriers of third-party internet service providers.
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Civil rights framework for the Internet
On April 23, 2014, the Brazilian Civil Rights Framework for the Internet (Marco Civil da Internet) was enacted through Law No. 12.965/2014. The act adopts strict Net Neutrality rules that guarantee equality of treatment for data traffic in the network and preserves the business model of Brazilian broadband offered in packages with different speeds. On May 11, 2016, the Brazilian government published Decree No. 8,711/2016, which regulates the law. It establishes the regulation for Net Neutrality and mechanisms to protect the data stored by service and application providers, as well as determining the circumstances in which data can be obtained by the public administration. We believe these measures offer our clients greater protection with respect to how their personal information is used and shared and creates opportunities for new services that make use of aggregated information.
Brazilian General Data Protection Law (LGPD)
Law No. 13.709/2018, or the LGPD, came into force on September 18, 2020. It is a comprehensive data protection law establishing general principles and obligations that apply across all economic sectors and contractual relationships. To regulate and supervise the application of the law, the ANPD was created and has been under the administration of the Ministry of Justice since 2023. Certain aspects of the LGPD will be subject to further regulation by the ANPD, in accordance with ANPD’s Ordinances No. 11/2021, 35/2022, and Resolution No. 23/2024, following its regulatory schedule published every two years.
The LGPD establishes detailed rules for the collection, use, processing and storage of personal data in all economic sectors, regardless of whether data is collected in a digital or physical environment. In general, our services and processes depend on personal data. The way in which we collect, store and manage this data must comply with the provisions of the LGPD. In addition, the administrative sanctions provided for in the LGPD (Articles 52, 53, and 54) came into force on August 1, 2021, pursuant to Law No. 14.010/2020, and additional rules were established with the publication of 10 additional regulations so far. Some of the main regulations, include the Administrative Sanctions and Dosimetry Regulation (Resolution No. 4/2023), the Security Incident Communication Regulation (Resolution No. 15/2024), and the International Data Transfer and Standard Contractual Clauses Regulation (Resolution No. 19/2024).
As of the date of this annual report, the ANPD has signed a number of technical cooperation agreements with administrative bodies and agencies, including the SENACON, the Brazilian Office of the Controller General (Controladoria Geral da União), or CGU, the National Supplementary Health Agency (Agência Nacional de Saúde Suplementar), the Latin America Development Bank and with the Information Commissioner’s Office of the United Kingdom. The ANPD has also signed a memorandum of understanding with the Spanish Data Protection Authority and with the Office of the Privacy Commissioner of Canada to promote cooperation mechanisms, including the exchange of knowledge, experiences, and practices in the field of privacy and personal data protection.
For additional information on our practices regarding the LGPD and our Privacy and Data Protection Governance Program, see “Item 16g. Corporate Governance—Corporate Governance Practices—Data Protection and Privacy Initiatives.”
Resolutions published
A series of new regulations, published by ANATEL as well as other regulatory bodies in Brazil, became effective in 2025. The most relevant among these regulations were:
•ANATEL Resolution No. 785: Approves ANATEL’s planning for auctions of radio frequency authorizations for SMP;
•ANATEL Resolution No. 784: Amends the Regulation on Administrative Sanctions (RASA);
•ANATEL Resolution No. 783: Approves the General Competition Goals Plan (PGMC);
•ANATEL Resolution No. 782: Amends the Regulation on Conduct Adjustment Commitment Agreements (RTAC);
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•ANATEL Resolution No. 781: Amends the Regulation on Licensing for Concession, Permission, and Authorization of Telecommunications Services and Radio Frequency Use;
•ANATEL Resolution No. 780: Amends the Regulation on Conformity Assessment and Product Homologation for Telecommunications;
•ANATEL Resolution No. 779: Approves the Telecommunications Glossary;
•ANATEL Resolution No. 778: Ensures compliance with Mercosur/GMC Resolution No. 19/24 on IMT frequency coordination;
•ANATEL Resolution No. 777: Approves the General Regulation of Telecommunications Services (RGST);
•ANATEL Resolution No. 776: Establishes guidelines for regulatory sandbox and experimental practices;
•ANATEL Resolution No. 775: Approves the Regulation for Temporary Use of Radio Frequencies;
•ANATEL Resolution No. 774: Approves the Regulation for Collection and Transfer of Sectoral Data;
•ANATEL Resolution No. 773: Approves the Regulation on Conditions of Use of Radio Frequencies;
•ANATEL Resolution No. 772: Approves the National Frequency Allocation, Assignment, and Distribution Plan (PDFF).
Public consultations published
In 2025, ANATEL announced a series of public consultations. The most relevant among these public consultations were:
•ANATEL Public Consultation No. 1: Reassessment of Tables and Appendices (A to D) of Annex I of Resolution No. 396/2005;
•ANATEL Public Consultation No. 3: Internalization and consolidation of standards/resolutions from international organizations;
•ANATEL Public Consultation No. 9: ANATEL’s planning for auctions of RF authorizations for SMP; ANATEL Public Consultation No. 17: Replacement of the Operational Procedure for Importing Telecommunications Products;
•ANATEL Public Consultation No. 19: Methodologies for calculating the base value of fine sanctions;
•ANATEL Public Consultation No. 27: Update of requirements for SMP signal booster certification;
•ANATEL Public Consultation No. 30: Network sharing and roaming on highways and coverage commitments;
•ANATEL Public Consultation No. 31: Use of Artificial Intelligence in the telecommunications service chain;
•ANATEL Public Consultation No. 40: Reassessment of the Regulation on Revenue Restitution and Compensation;
•ANATEL Public Consultation No. 44: Revocation of regulations (Regulatory Guillotine 2025–2026);
•ANATEL Subsidy Taking No. 1: Regulatory Guillotine 2025–2026;
•ANATEL Subsidy Taking No. 2: Collection of information on the implementation of new STFC local areas;
•ANATEL Subsidy Taking No. 4: Reassessment of regulatory obligations applicable to SeAC;
•ANATEL Subsidy Taking No. 5: Reassessment of maximum RF limits;
•ANATEL Subsidy Taking No. 6: Improvement of information on SMP service provision;
•ANATEL Subsidy Taking No. 8: ARR of the Research Regulation, annex to Resolution No. 654/2015.
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Other regulatory matters
Regulation for competition
In December 2016, ANATEL launched a public consultation for a regulation that set price references for wholesale products. The proposal would set the ANATEL cost model as the only source for the valuation of these products. In July 2018, ANATEL approved amendments to the PGMC through Resolution No. 694/2018. The rule creates a new relevant market (high-capacity data transfer) and introduces the concept of retail competitiveness levels for each municipality (ranging from category one, fully competitive, to category four, non-competitive areas where public policies are necessary to enable services). For each relevant market, asymmetric measures may vary according to the competition category assigned to each municipality. In addition, the new PGMC defines small-scale providers (prestadora de pequeno porte), or PPP, which ANATEL factors when creating asymmetric rules (in the context of PGMC and possibly in other regulations). Under the definition set by ANATEL, PPP designation applies to any company that does not account for more than 5% of the retail market share in which it operates.
In November 2023, ANATEL published a public consultation dedicated to updating the PGMC which was scheduled to end in April 2024. The updated PGMC was approved and published in September 2025, establishing several obligations for the following wholesale markets.
•Passive Infrastructure (Ducts and Subducts);
•Interconnection for Fixed Networks;
•Interconnection for Mobile Networks; and
•Roaming.
Updated regulatory framework
On October 4, 2019, the New General Telecommunications Law was published. This law revises the General Telecommunications Law and significantly impacts the industry. The New General Telecommunications Law permits fixed-line concessions operators to migrate from a concession regime (in which the underlying assets must be reverted to the government at the end of the concession) to an authorization regime.
On December 16, 2024, Telefônica Brasil, ANATEL, the TCU and the Brazilian Ministry of Communications signed the Self-Composition Agreement for the adaptation of our STFC concession contracts to an authorization instrument.
The Self-Composition Agreement includes several key conditions that we are required to comply with: (i) Telefônica Brasil is required to make specific investments on terms established under the Self-Composition Agreement; (ii) Telefônica Brasil must maintain the provision of fixed-line telephone services in certain locations without adequate competition, within the concession area until December 31, 2028; (iii) all pending administrative and judicial proceedings related to our concession pending before ANATEL or any courts must be settled, and Telefônica Brasil must withdraw any cases filed against ANATEL; and (iv) Telefônica Brasil must commit to fulfilling public interest pledges for up to 10 years as part of the transition process. On April 11, 2025, Telefônica Brasil signed the unified authorization term with ANATEL that compiled all previous licenses into a single title, thereby finalizing the transaction to the authorization regime.
Furthermore, the New General Telecommunications Law also permits the successive renewal of an authorization to explore a spectrum, so long as legal requirements and stipulations are met. Under the previous model, each authorization could be renewed only once. In addition, New General Telecommunications Law permitted the creation of a secondary spectrum trading market among authorized operators, where trades can be placed directly between them. Similarly, companies holding the rights to explore Brazilian satellite positions can have their permits renewed on an unlimited basis. However, these aspects of the law are still subject to implementation through regulations, which have yet to be passed.
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Finally, under the New General Telecommunications Law, the FUST law was revised to clarify that radio and video broadcasting services are not subject to taxation under the FUST.
Telecommunications Self-Regulation System
In March 2020, we and the main telecommunications service providers in Brazil launched a joint initiative aimed at establishing the sector’s first comprehensive self-regulation program. The Telecommunications Self-Regulation System (Sistema de Autorregulação das Telecomunicações), or the SART, sets common rules and procedures that must be followed by all participating companies in relation to the most relevant topics regarding the relationship between providers and customers, such as telemarketing, offers, billing and customer care.
Although the initiative started with large operators, the SART will be open to any telecommunications company that wants to participate and commits itself to the principles defined by the program. The main benefit for participating companies are the defined procedures and rules towards improving services, resulting in greater consumer satisfaction and promoting an environment that stimulates a more principle-oriented approach to regulatory issues.
The first self-regulatory norm established by SART was the Telemarketing Code of Conduct, which brings self-regulation rules for the relationship between consumers and telecommunication operators, setting forth basic principles that must be followed by the companies, such as the duration and number of calls. Additionally, the Do not Disturb Platform was also created, which has already blocked more than 7 million telephones for telemarketing calls at the customer’s request, according to the Telecommunications Providers Association, or CONEXIS.
SART also created the Customer Service Regulation, which sets out rules for meeting consumer demands related to telecommunications products and services, in the various relationship channels available. The Billing Regulation, another initiative coordinated by SART, guides collection actions and establishes commitments on payment methods, debt negotiation, contestation, return of amounts and contractual termination. Finally, the Product Offers Regulation, in turn, bring rules on contracting products and services and their presentation, using simple, direct and easy-to-understand language, focusing on bringing more transparency to information disclosure for consumers. Together, these initiatives emphasize the values of respecting consumer rights, promoting fair competition and encouraging correct, efficient and transparent communication with society in general.
Telecommunications Consumers Rights
The new General Consumer Rights Regulation (RGC) published by ANATEL in November 2023, and approved by Resolution No. 765/2023, introduces changes in certain provisions related to telecommunications service offerings, including rules around blocking due to payment default. This regulation also updates and modernizes customer relationship obligations. The new RGC came into force in September 2025, replacing the previous Resolution No. 632/2014.
C.Organizational Structure
As of December 31, 2025, 77.13% of our voting shares were controlled by the three main controlling shareholders: Telefónica S.A., with 39.32%, Telefónica Latinoamérica Holding, S.L., with 37.74%, and Telefónica Chile S.A., with 0.06%.
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Our current general corporate and shareholder structure is as follows:
Significant Subsidiaries
Our subsidiaries are Terra Networks Brasil Ltda. (formerly known as Terra Networks Brasil S.A.), or Terra, POP Internet Ltda., or POP, and Telefonica Transporte e Logística Ltda, or TGLog, Fundo de Investimento em Direitos Creditórios Vivo Money, or Vivo Money, and Vivo Pay Holding, all of which we own and are based in Brazil.
On September 30, 2020, Terra Networks Brasil S.A., a wholly-owned subsidiary of Telefônica Brasil, resolved in favor of changing its corporate form from a corporation to a limited liability company in the process of changing its name to Terra Networks Brasil Ltda. The resolution was carried out through an extraordinary shareholders’ meeting.
Associated Companies
Aliança Atlântica Holding BV (Aliança): Headquartered in Amsterdam, Netherlands, the entity is 50.00% owned by Telefônica Brasil and holds funds generated by the sale of its shares of Portugal Telecom in June 2010.
Companhia AIX de Participações (AIX): Headquartered in Brazil, the entity is 50.00% owned by Telefônica Brasil and holds a 93.00% stake in the Refibra consortium, formed to finalize a network of underground fiber pipelines in Brazil, in order to make them commercially viable.
Companhia ACT de Participações (ACT): Headquartered in Brazil, the entity is 50.00% owned by Telefônica Brasil and holds a 2.00% stake in the Refibra consortium.
Vivo Ventures Fundo de Investimento em Participações Multiestratégia (Vivo Ventures): Headquartered in Brazil, the fund is 98.00% owned by Telefônica Brasil and 2.00% by Telefônica Open Innovation SL.
Telefônica Cloud e Tecnologia do Brasil S/A (T. Cloud): Headquartered in Brazil, the entity is 50.01% owned by Telefônica Brasil and 49.99% by Telefônica Cybersecurity & Cloud Tech, SL.
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Recicla V Comércio e Reciclagem de Sucatas e Metais Ltda. (Recicla V): Headquartered in Brazil, the entity is directly owned 0.01% by Telefônica Brasil and indirectly held 99.99% by POP.
FiBrasil: Headquartered in Brazil, the company is 75.01% controlled by Telefônica Brasil and 24.99% by Telefónica Infra, SLU (“TEF Infra”).
GUD Energia: Headquartered in Brazil, the entity is 50.00% owned by Telefônica Brasil and 50.00% by Auren Comercializadora de Energia Ltda.
Vivo Pay SCD: Headquartered in Brazil, the entity is directly owned 0.01% by Telefônica Brasil and indirectly held 99.99% by Vivo Pay Holding.
Indirect shareholdings
Telefônica Brasil S.A. holds indirect interests in the following companies: Telefônica Infraestrutura e Segurança Ltda. (“TIS”), TLF01, Vale Saúde Sempre (VSS), IPNET USA, SAMAUMA and TCyber.
Disclosure Pursuant to Section 219 of the Iran Threat Reduction and Syria Human Rights Act
Section 219 of the Iran Threat Reduction and Syria Human Rights Act of 2012 added Section 13(r) to the Exchange Act. Section 13(r) requires an issuer to disclose in its annual or quarterly reports filed with the SEC whether the issuer or any of its affiliates has knowingly engaged in certain activities, transactions or dealings with the Government of Iran, relating to Iran or with designated natural persons or entities involved in terrorism or the proliferation of weapons of mass destruction during the period covered by the annual or quarterly report. Disclosure is required even when the activities were conducted outside the United States by non-U.S. entities and even when such activities were conducted in compliance with applicable law.
The following information is disclosed pursuant to Section 13(r). None of these activities involved U.S. affiliates of Telefónica or the Company.
Roaming Agreements with Iranian Operators
Some subsidiaries of our controlling shareholder, Telefónica, including us, have entered into roaming agreements with Iranian telecommunication companies. Pursuant to such roaming agreements these subsidiaries’ customers are able to roam in the particular Iranian network (outbound roaming) and customers of such Iranian operators are able to roam in the network of Telefónica’s relevant subsidiary (inbound roaming). For outbound roaming, these subsidiaries pay the relevant Iranian operator roaming fees for use of its network by Telefónica group customers, and for inbound roaming, the Iranian operator pays the relevant subsidiary roaming fees for use of the respective network by its customers.
Regarding Iran, we have a roaming agreement with Irancell. During 2025 we recorded US$17.13 in roaming revenues and zero expenses payable to Irancell under this agreement.
Telefónica’s subsidiaries and Telefónica’s former subsidiary Telefónica UK Ltd., other than our Company (which arrangements are described above), were party to the following roaming agreements with Iranian telecommunication companies in 2025:
(1)Telefónica Móviles España S.A., or TME, Telefónica’s Spanish directly wholly-owned subsidiary, has respective roaming agreements with (i) Mobile Telecommunication Company of Iran, or MTCI, (ii) Taliya Mobile, or Taliya, and (iii)Telecommunication Kish Co., or TKC. During 2025, TME recorded the following revenues related to these roaming agreements: (i) €690,172.66 from MCI, (ii) no revenues from Taliya and (iii) no revenues from TKC.
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(2)Telefónica Germany GmbH & Co. OHG, or TG, Telefónica’s 96.85% indirectly-owned subsidiary (as of December 31, 2025), has respective roaming agreements with MTCI and Irancell. During 2025, TG recorded the following revenues related to these roaming agreements: (i) €4,614.95 and (ii) €43,133.77 from Irancell.
(3)Telefónica UK Ltd, or TUK, Telefónica’s former English directly wholly-owned subsidiary, has a roaming agreement with Taliya. TUK ceased to be Telefónica’s subsidiary upon the establishment of JV VMED O2 UK on June 1, 2021, following which establishment TUK has been owned by VMO2. During 2025, TUK recorded no revenues from Taliya.
(4)Pegaso PCS S.A. de C.V., or PCS, Telefónica’s Mexican directly wholly-owned subsidiary, has a roaming agreement with Irancell. During 2025, PCS recorded US$75.71 in roaming revenues from Irancell under this agreement.
The net profit recorded by Telefónica’s subsidiaries and TUK pursuant to these agreements and arrangements did not exceed the related revenues recorded thereunder.
The purpose of all of these agreements is to provide the Telefónica group’s customers with coverage in areas where the group does not own networks. For this purpose, Telefónica’s subsidiaries intend to continue maintaining those agreements, which are still outstanding.
The Telefónica group does not currently have any plans to enter into new roaming arrangements with Iranian telecommunication companies. However, the Telefónica group may consider entering into such arrangements in the future.
During 2025, Telefónica Hispam (“TH”) had one retail mobile phone contract with one customer identified in the list administered by OFAC as sanctioned pursuant to Executive Order 13382. During 2025, TH recorded revenues totaling US$24.32 dollars related to this customer. The termination of such contract is being considered. The provision of the relevant services by TH was in compliance with applicable laws.
During 2025, TG had one retail mobile phone contracts with one customer in Germany identified in the lists administered by OFAC as sanctioned pursuant to Executive Order 13224 and Executive Order 13382. During 2025, TG recorded revenues totaling €2,116.79 related to this customer. The termination of such contract is being considered. The provision of the relevant services by TG was in compliance with applicable laws.
D.Property, Plant and Equipment
As of December 31, 2025, we had fixed and mobile operations in 3,340 properties, 2,003 of which we own, of which 101 are administrative buildings. Besides that, we have entered into standard leasing agreements to rent the remaining properties, under which 124 administrative areas, seven kiosks and 307 retail stores are leased. Our main physical properties for providing fixed-line telephone services involve the segments of switching (public switching telephone network, or PSTN), transmission (optic and wireless systems), data communication (multiplex devices, IP network), infrastructure (energy systems and air conditioning) and external network (fiber optic and metallic cables), which are distributed in many buildings throughout the state of São Paulo and in the main cities outside the state of São Paulo. Some of these buildings are also used for administrative and commercial operations.
Our main physical property for mobile services consists of transmission equipment, switching equipment, base stations, and other communication devices, such as voicemail, prepaid service, short message service, home location registers, signaling transfer point, packet data switching network and gateways. All switches, cellular sites, administrative buildings, administrative facilities, warehouses and stores are insured against damages for operational risks.
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Pursuant to Brazilian legal proceedings, liens have been attached to several properties pending the outcome of various legal proceedings to which we are a party. See “Item 8. Financial Information—A. Consolidated Statements and Other Financial Information—Legal Proceedings.” In addition, certain of our properties are still pending the applicable licenses and approvals from the local fire departments.
We are constantly making improvements to our facilities and network to meet customer demand and to improve the level of services we offer our clients.
Environmental matters
Brazilian environmental legislation at federal, state, and municipal levels regulate environmental protection, the responsible use of natural resources, the preservation of fauna and flora, climate change mitigation and adaptation, as well as pollution prevention and control. Under these laws, specific environmental licenses are required for the undertaking the construction, installation, expansion, or operation of structures used to provide telecommunications services. According to the enforceability defined by the competent authorities, this obligation is extended to telecommunications infrastructure such as support structures for radio/cell base stations, transmission backhaul, and backbone networks, as well as to specific regulations related to air emissions, soil and water pollutants, take-back systems, recycling and waste management, interference with areas of cultural and historical relevance, environmental protected areas and contamination.
In Brazil, non-compliance with environmental rules or regulations may result in civil, administrative, or criminal liability. Regarding civil liability, Brazilian environmental laws adopt a standard of strict, unlimited, and joint liability remediation of environmental impacts. Furthermore, Brazilian courts may pierce the corporate veil when and if it poses an obstacle to the full recovery of environmental damages. Within the administrative sphere, companies may face penalties of up to R$50 million, suspension of operations, exclusion from specific government contracts, obligations to repair or indemnify environmental damages, loss of tax benefits and incentives and be at a competitive disadvantage to match the criteria assessed by sustainability indexes such as the Dow Jones Best-in-Class World Index and the B3’s Corporate Sustainability Index (ISE B3).
We have procedures in place to protect our networks, reputation and operations from environmental impacts, ranging from operational controls to specific insurance coverage for civil and environmental matters. In order to maintain and enhance environmental performance, we have implemented the Solid Waste Management System (Gretel), that allows us to manage the flow of generation, transportation and disposal of hazardous and non-hazardous waste, promoting supply chain traceability and circular economy actions.
The Company has an Environmental Management System (EMS) that follows the international standard ISO 14001, with third-party certification covering the major capitals and metropolitan regions since 2016. The EMS is periodically audited on a sample basis to assess its effectiveness. Observations identified during these audits are addressed through action plans aimed to provide continuous improvement and best environmental practices. Engineering measures are also implemented to mitigate potential risks, such as reducing visual impact of facilities, modernizing equipment to lower noise emissions, and adapting structures to contain potential leaks.
Energy is a critical resource for our network infrastructures, which requires substantial power. To address this demand, we have implemented a Renewable Energy Plan that enabled us to achieve 100% renewable electricity consumption since November 2018—12 years ahead of our initial target. This milestone was achieved through a combination of distributed generation, self-generation, free-market (FM) energy purchases, and the acquisition of renewable energy certificates with guarantees of origin.
In 2025, we reached 77 Distributed Generation plants with 76.4 MWm of installed capacity across Brazil. Upon the completion of the project, it will supply 90% of our low-voltage energy consumption, with a total installed power of 80.9 MWm from renewable sources (solar, hydro, and biogas).
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Climate change is a key pillar of our sustainability strategy, supported by short-, medium-, and long-term objectives consolidated in our Climate Action Plan approved by the Board of Directors. Our main goal is to achieve net zero emissions by 2035 for the entire value chain. Significant progress has been made, including reducing our greenhouse gas (GHG) emissions (Scope 1 and 2) by 90% compared to our 2015 baseline. This achievement was enabled by renewable energy purchases, resulting in zero Scope 2 emissions under a market-based approach; use of biofuel in our fleet; operational improvements in air conditioning systems; and compensating for residual emissions.
Since 2019, we have offset 100% of operational emissions through high-integrity carbon credits, selected to generate positive social and environmental impacts, including preventing deforestation and supporting restoration in Brazilian forests.
Beyond operational emissions (Scope 1 and 2), which are linked to 5% of all our employees’ Results Participation Program (PPR, its acronym in Portuguese), we are working to reduce impacts across our value chain. Through the Supply Chain Engagement Carbon Program, we engage our suppliers from the most carbon-intensive categories to measure and manage emissions, seek reduction alternatives, and make a voluntary climate commitment, contributing to our Scope 3 reduction target.
Environmental transparency is essential for a net-zero future. In 2025, we launched the third edition of our Climate Action Plan for public consultation and investor feedback, consolidating our strategy for transitioning to a low-carbon economy. We have consistently been among the Brazilian companies recognized in a leadership position by CDP Climate Change, demonstrating the strength of our environmental management.
In 2006—prior to Brazil’s National Policy on Solid Waste (Law No. 12,305/2010) and Decree No. 10,240/2020, regulating mandatory reverse logistics of electronic—we launched the Vivo Recicle Program, a pioneering initiative in the sector promoting circular economy and proper disposal of electronic waste nationwide. The program offers approximately 1,800 collection points for receiving used devices such as cell phones, tablets, headphones, chargers, and batteries.
Since its implementation, millions of e-waste items have been collected, resulting in the recycling of approximately 232 tons of materials. In 2025, the Vivo Recicle Program increased more than 20%, growing from 37 tons collected and recycled in 2024 to over 45 tons in 2025. We have also set a long-term commitment to collect 375 tons of electronic waste by 2035, reinforce our leadership in circular economy practices.