The company, a unit of Spain's Telefonica, which operates in Brazil under the Vivo<\/a> brand, posted net income of 746 million reais ($139.4 million).
Telefonica's bottom line was mainly affected by a 282% jump in financial expenses, as the company took on more debt to pay for the acquisition of 5G licenses and the mobile phone business of carrier Oi, at a time of rising borrowing costs.
Recurring earnings before interest, taxes, depreciation and amortization came in at 4.58 billion reais, up 8.3% from the previous year.
Operating net revenue for the period rose 11.1% to 11.83 billion reais. Net revenue from the company's mobile phone services, its main business, grew 16% to 8.1 billion reais, boosted by new clients brought over from Oi, which Telefonica agreed to buy in 2020.
The migration of Oi's clients is expected to be fully completed by the end of the first quarter of 2023.
Amid rampant inflation in Brazil, Telefonica's operating costs rose by 27.3% in the period, to reach 5.06 billion reais.
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