TIM (TIMS3) Q2 2024 earnings summary

Executive summary

• Achieved robust financial and operational results in 2Q24, with strong revenue, EBITDA, and net income growth year-over-year, driven by mobile, postpaid migration, and fiber segments.

• 5G coverage expanded to 353 cities, maintaining leadership in market share gains and 5G user growth.

• Continued innovation in digitalization, AI initiatives, and customer migration to higher-value plans, with improved customer service metrics.

• Recognized for ESG leadership, diversity, and accessibility, winning multiple awards.

• Maintained a rational competitive environment, focusing on quality and value rather than price competition.

Financial highlights

• Normalized net revenue rose 7.5% YoY to R$6,303 million in 2Q24; service revenue up 7.2% YoY, with both mobile and fixed segments contributing.

• Normalized EBITDA increased 8.2% YoY to R$3,153 million, with margin expanding to a record 50.0% in 2Q24.

• Normalized net income reached R$781 million, up 22.5% YoY, the highest ever for a second quarter.

• Operating cash flow (EBITDA-AL minus Capex) grew 23.8% YoY to R$1,536 million; operating free cash flow up 79.2% YoY to R$948 million.

• Capex was R$925 million, flat YoY, with Capex/Net Revenue at 14.7%.

Outlook and guidance

• Guidance for 2024 Capex remains unchanged at R$4.4–4.6 billion, with continued investment in 5G and fiber expansion.

• Management confident in delivering on the strategic plan, emphasizing value creation and operational efficiency, but expects revenue growth to moderate in H2 due to tougher comps and macro challenges.

• CapEx expected to close the year within guidance bands, with positive working capital anticipated in H2.