Allied Tecnologia S.A. (ALLD3) Q1 2025 earnings summary

Executive summary

• Net revenue reached R$1,197.1 million in 1Q25, down 15.6% year-over-year, mainly due to a 62.6% drop in international sales, while Brazil operations grew 3.8% over 1Q24.

• Net income was R$15.1 million, down 69.9% year-over-year, with gross profit at R$146.4 million and EBITDA at R$50.5 million.

• Distribution in Brazil grew 7.7%, with smartphone sales up 20% and market share increasing by 1.1 percentage points.

• Digital retail and Trocafy (refurbished devices) saw strong growth, with Trocafy revenue up 3x year-over-year.

• Operational efficiency, cost control, and cash flow management remained key priorities amid high interest rates and market challenges.

Financial highlights

• Net revenue: R$1,197.1 million (-15.6% YoY); Brazil: R$1,041.8 million (+3.8% YoY); International: R$155.4 million (-62.6% YoY).

• Gross profit: R$146.4 million (-12.8% YoY); gross margin: 12.2% (+0.4 p.p. YoY).

• Adjusted EBITDA: R$50.5 million (-14.3% YoY); margin: 4.2% (+0.1 p.p. YoY).

• Net income: R$15.1 million (-69.9% YoY); net margin: 1.3% (-2.2 p.p. YoY).

• Net debt reduced by 31% YoY to R$140.4 million (0.7x LTM EBITDA); cash position at R$338.1 million.

Outlook and guidance

• Strategic focus on profitability, cost control, and market share expansion in Brazil, with continued investment in refurbished products and B2B/B2C partnerships.

• Expectation of stable working capital and inventory levels in the next quarters, with higher turnover in Q4.

• No significant impact anticipated from US tariffs after process adjustments.