Locaweb Serviços de Internet (LWSA3) Q3 2025 earnings summary

Executive summary

• Net revenue grew 10.9% year-over-year in Q3 2025, reaching R$387.4 million, driven by a 16.6% increase in the Commerce segment and strong operational execution.

• Adjusted EBITDA rose 18.1% year-over-year to R$87.0 million, with margin expansion to 22.5%.

• Significant divestments included the sale of Wake Creators and Nextios portfolio, resulting in a non-cash impairment charge of R$287.8 million and a fiscal asset of R$117 million.

• Subscriber base expanded to approximately 204,700, up 7.0% year-over-year, with ARPU in Commerce up 13%.

• Integration with TikTok Shop and TEMU enhanced sales channels and client adoption.

Financial highlights

• Consolidated net revenue: R$387.4 million (+10.9% YoY); Commerce net revenue: R$283.4 million (+16.6% YoY); BeOnline/SaaS net revenue down 2.1%.

• Adjusted EBITDA: R$87.0 million (+18.1% YoY), margin up 1.4 p.p. to 22.5%.

• Free cash flow after capex: R$70.5 million in Q3 2025 (+607.6% YoY), R$161.2 million YTD, margin 14.6%.

• Adjusted net income: R$56.6 million (+52.9% YoY); reported net loss of R$287.8 million due to non-cash impairment.

• Cash and equivalents at R$309.3 million at quarter-end.

Outlook and guidance

• Management expects continued growth above inflation, driven by product improvements, digitalization, and operational efficiency.

• Transactional and recurring revenue streams are expected to become increasingly significant.

• No major M&A planned; focus remains on organic growth, product integration, and capital allocation.