Vasta Platform Limited

For the 2025 sales cycle, Vasta reported net revenue of BRL 1.737 billion, up 13.6%; subscription revenue of BRL 1.552 billion, up 14.3%; non-subscription revenue of BRL 119 million, up 16%; adjusted EBITDA of BRL 494 million, up 9.9% from BRL 449 million; gross margin of 62.8%, down 1.4 percentage points from 64.2%; adjusted net profit of BRL 82 million, up 32% from BRL 62 million; and free cash flow of BRL 316 million, up 117%. In Q3, total net revenue was BRL 250 million, up 13.4%, with subscription revenue of BRL 212 million, up 3%, and non-subscription revenue of BRL 21 million, up 45%. Net debt ended at BRL 863 million, and net debt to last 12 months adjusted EBITDA was 1.75x, down from 2.32x a year earlier. For 2026, management said it expects mid-double-digit revenue growth, continued >20% growth in complementary products, and EPCA+ pricing of about 1% to 2% next cycle. The company also said fiscal-year free cash flow conversion should be about 50% of EBITDA, versus 41.8% in 2024.

Guilherme Melega framed the quarter as evidence of strong execution, saying the company delivered consistent growth in revenue and profitability while keeping operational discipline, cash flow performance, and strategic priorities on track. He highlighted share gains in learning systems and complementary products, progress in B2G diversification, and traction in Start Angle Bilingual School, where Vasta now has 6 units, over 50 signed contracts, and a pipeline of more than 300 prospects. He struck an upbeat tone on 2026, pointing to innovation in AI-based tools like the individualized educational plan and saying the company is confident it can sustain growth and enhance profitability.

Cesar Silva focused on the financial bridge behind the quarter: Q3 net revenue of BRL 250 million, adjusted EBITDA of BRL 494 million, gross margin of 62.8%, adjusted net profit of BRL 82 million, and free cash flow of BRL 316 million. He said gross margin declined 1.4 percentage points mainly because of product mix, while provisions for doubtful accounts improved to 3.1% of net revenue, though he still sees credit challenges ahead for non-premium customers. He also noted commercial expenses rose as the company invested in the 2026 sales cycle, G&A improved due to workforce optimization and budget discipline, and early collections helped free cash flow but should normalize next quarter.

The lone analyst question focused on the 2026 ACV buildup and the balance between volume and pricing. Management said the 14.3% subscription revenue growth trend should continue into 2026, describing the outlook as mid-double-digit revenue growth, with complementary products still growing more than 20%. On pricing, Guilherme Melega said Vasta has been able to raise EPCA+ for the last five cycles and is targeting the same, with 1% to 2% for the next cycle described as a good estimate.