Oi (OIBR4) Q1 2025 earnings summary

Executive summary

• 1Q25 marked a new operating model post-M&A, with Oi Soluções as the main growth driver and three revenue components: Oi Soluções, domestic subsidiaries, and legacy operations.

• Oi Soluções is positioned as a market leader in digital and IT services, with a robust portfolio and strong presence in both private and public sectors.

• Legacy services now represent only 15% of total revenue, with decommissioning expected by end-2025 and R$2.5 billion in accumulated savings.

• Subsidiaries and new contracts in cloud and ICT contributed to revenue growth, especially in the private sector and government spheres.

• Strategic focus on cost control, efficiency, and profitability, with significant reductions in Opex and Capex.

Financial highlights

• Consolidated net revenue for 1Q25 was R$631 million, down 27% year-on-year, mainly due to the reduction in non-core revenues and asset sales.

• Net income reached R$1.66 billion, reversing a loss of R$2.79 billion in 1Q24, mainly due to non-routine gains from asset sales.

• Routine OpEx was R$1.9 billion, a 21% year-on-year reduction.

• CapEx totaled R$78 million, a 44% year-on-year reduction, representing 5% of revenue.

• Gross debt at fair value dropped 58.9% year-over-year to R$11.3 billion, reflecting debt restructuring and asset sales.

Outlook and guidance

• Continued focus on strengthening Oi Soluções and expanding subsidiary revenues, with further cost reductions expected as legacy decommissioning completes.

• Ongoing cost rationalization and acceleration of legacy network demobilization expected to yield further savings.

• Addressing funding gaps and progressing with asset sales as part of the court-supervised reorganization plan.

• The company’s ability to continue as a going concern depends on the full implementation of the new judicial recovery plan, successful asset sales, and ongoing cash generation.