Valid Soluções (VLID3) Q1 2025 earnings summary

Executive summary

• Net revenue reached BRL 501 million in Q1 2025, up 4% year-over-year, driven by ID, Mobile, and New Businesses, with VSoft consolidation contributing.

• EBITDA was BRL 104 million, down 10% year-over-year, with a margin of 20.8%, mainly impacted by the Pay segment.

• Net income was BRL 73 million, positively impacted by the divestment of Colombian Pay operations; recurring net income (excluding asset sales) was BRL 44 million, up 23% year-over-year.

• New Businesses contributed BRL 77 million in revenue, up 143% year-over-year, now representing 15% of total revenue and 27% of EBITDA.

• Strong cash flow and net cash position maintained, with operational cash generation of BRL 133 million and prudent capital allocation.

Financial highlights

• EPS for the quarter was BRL 0.93, up 66% sequentially but down 50% year-over-year.

• Recurring net revenue grew 23% year-over-year.

• High EBITDA-to-cash conversion rate at 127%.

• Share price rose 48% over 12 months; average daily trading volume up 25% YoY to BRL 11 million.

• R$123M in interest on equity announced for 2025, R$1.78 per share.

Outlook and guidance

• Focus on expanding new digital businesses, integrating acquisitions, and investing in technology and innovation.

• Management expects continued growth in ID, Mobile, and Digital Government, with eSIMs and digital onboarding as key drivers.

• Anticipates Pay segment recovery in the second half of 2025, driven by improved pricing.

• Market for new digital businesses in Brazil estimated at over BRL 26 billion, with significant growth potential.

• Ongoing shareholder remuneration and disciplined capital allocation.