Telefonica Brasil Net Profit Rose 9.6% in 3rd Quarter

By Rogerio Jelmayer

SAO PAULO--Telefonica Brasil SA (VIVT4.BR) posted a 9.6% net profit increase in the third quarter, as a combination of cost cutting and rising revenue streams offset a decline in mobile-phone subscriptions.

The company, which is controlled by Spain's Telefonica SA (TEF.MC), recorded a net profit of 952.7 million Brazilian reais ($307.3 million), up from BRL869.3 million in the year-ago period.

Telefonica's operating costs dropped 2.2% in the period to BRL7.28 billion, while net revenue rose 1.1% to BRL10.69 billion. Revenue from data and digital services advanced 23.3% to BRL3.6 billion.

The company said it ended the third quarter with 97.2 million customers, down from 103.67 million in the year-earlier period.

After consecutive years of double-digit expansion, the country's mobile market is facing challenges stemming from a weak economy, with high inflation and interest rates discouraging buyers, according to economists. After contracting 3.8% last year, Brazil's economy is expected to shrink 3.2% this year.

Telefonica Brasil is Brazil's largest mobile-phone company by market share, according to telecommunications regulator Anatel.

Write to Rogerio Jelmayer at [e-mail]

(END) Dow Jones Newswires

October 26, 2016 05:52 ET (09:52 GMT)

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