TIMB

Business Context and Reporting Period

Company: TIM S.A.
Filing Type: Form 6-K (Report of Foreign Private Issuer)
Reporting Period: Year ended December 31, 2025
Report Date: February 10, 2026
Currency: Brazilian Reais (R$) in thousands, unless otherwise noted.

TIM S.A. is a Brazilian telecommunications operator providing mobile, fixed-line, and broadband services. The company reported robust results for 2025, meeting annual targets despite intense competitive dynamics. Key strategic advances included the expansion of 5G coverage to nearly 1,000 cities, growth in the B2B segment, and the acquisition of V8.Tech to enhance digital transformation capabilities.

Key Financial Metrics

Margins: Adjusted EBITDA margin reached 50.8% (up 1.2 percentage points YoY). EBIT margin was 23.8%.

Material Changes vs. Prior Period

• Revenue Growth: Net revenue increased 4.6% YoY, driven by a 5.2% increase in services revenue. Mobile services revenue outperformed inflation (IPCA 4.26%).
• Profitability: Net profit surged 36.7% YoY to R$4.31 billion. EBIT grew 15.2% YoY.
• Cost Control: Operating costs and expenses remained below inflation, reflecting rigorous cost discipline.
• Financial Result: Net financial result improved 5.3% YoY, aided by higher yields on financial investments and favorable derivative mark-to-market, partially offset by increased lease interest charges.
• Debt Profile: Total post-hedge debt increased to R$16.997 billion (up R$791 million vs. 4Q24), primarily due to an increase in lease liabilities, partially offset by a reduction in financial debt.
• Shareholder Returns: The company declared R$4.0 billion in total dividends and interest on equity for 2025. A share buyback program repurchased 33.5 million shares, with 28.7 million subsequently cancelled.

Guidance, Outlook, Risks, and Unusual Items

Outlook & Strategy: Management expressed satisfaction with 2025 results and confirmed the company is prepared for 2026 growth. Strategic focus remains on 5G expansion, B2B digital transformation, and efficient capital allocation. The acquisition of V8.Tech (completed Jan 2026) reinforces the B2B strategy.

Risks & Contingencies:

• Legal & Tax: Significant provisions exist for legal and administrative proceedings (R$1.56 billion). Unprovisioned possible losses total R$26.7 billion, primarily related to tax disputes (Federal, State, Municipal) and regulatory fees (FUST/FUNTTEL).
• Regulatory: Ongoing disputes with ANATEL regarding service quality targets and fee collections. A favorable Supreme Court decision in April 2025 reversed a R$169 million provision related to a Public Civil Action.
• Macroeconomic: Exposure to high interest rates (SELIC at 15%) and exchange rate fluctuations, though foreign currency debt is fully hedged.

Unusual Items:

• C6 Bank Partnership: The strategic partnership with Banco C6 was terminated in Q1 2025. Related financial assets and warrants were written off, and receivables of R$520 million were settled.
• Stock Split: A reverse stock split (100:1) followed by a stock split (1:100) was executed in July 2025 without affecting share capital.

Investor Verification Checklist

• Debt Composition: Verify the impact of the R$13.76 billion in lease liabilities on future cash flow obligations and leverage ratios.
• Tax Contingencies: Review the R$24.45 billion in unprovisioned tax risks and the status of key lawsuits regarding FUST/FUNTTEL and ICMS credits.
• Capital Returns: Confirm the sustainability of the R$4.0 billion dividend/interest payout relative to free cash flow generation.
• Acquisition Integration: Monitor the integration and performance of the newly acquired V8.Tech (R$140 million base price + earn-outs).
• 5G Capex: Assess the efficiency of capital expenditure directed toward 5G network expansion and its impact on future revenue monetization.