Valid Soluções (VLID3) Q2 2025 earnings summary

Executive summary

• Q2 2025 consolidated net revenue was R$490M–R$501M, down 5% year-over-year, with strong growth in Mobile and New Businesses but a sharp decline in Pay.

• EBITDA for the quarter was R$92M–R$104M, down 29% year-over-year, mainly due to Pay segment weakness.

• New Businesses grew 50% year-over-year, now representing 17% of total revenue and 33–38% of EBITDA, with an ARR of R$324M.

• Net income for 2Q25 was R$55M (11% margin, -31% YoY); for 1H25, net income reached R$128M, with EPS of R$1.63.

• The company is transforming from physical to digital, focusing on scalable, recurring models in Digital Government, Onboarding, and Mobile Solutions.

Financial highlights

• Mobile segment revenue grew 37% year-over-year to R$153M, with EBITDA up 52% to R$31M and margin improvement.

• ID segment posted 12% year-over-year revenue growth to R$226M, with EBITDA margin at 27.8%.

• Pay segment revenue dropped 45–46% year-over-year to R$111M, with EBITDA margin turning negative at -2.1%.

• Net cash position at quarter-end was R$49M, with net debt/EBITDA at -0.1x; cash position ended at R$622M.

• Operating cash flow conversion for 1H25 was 73%, in line with historical levels.

Outlook and guidance

• Management expects continued strong growth in New Businesses, especially in digital government and onboarding, with annualized 2Q25 revenue projected at R$324M.

• Mobile segment is expected to remain a positive contributor, leveraging international demand and eSIM expansion.

• Pay segment faces a challenging outlook, with no expected volume growth and continued margin pressure; focus is on efficiency and digital portfolio development.

• Investments in technology, innovation, and talent remain a priority, supported by new financing.

• R$85M allocated for acquisitions in 2025, supporting both organic and inorganic growth.