Summary of ABEV Q3 2025 Earnings Call

1Key Financial Results and Metrics

Net Revenue: Grew by 4% year-to-date, supported by a 7% increase in net revenue per hectoliter.

EBITDA: Increased by 3% in Q3, with a 50 basis points margin expansion.

Normalized EPS: Grew by 8% year-over-year.

Normalized Net Income: Reached BRL 3.8 billion, up 7% year-over-year; stated net income was BRL 4.9 billion, reflecting a 36% increase due to one-off effects.

Cash Flow from Operating Activities: Totaled BRL 6.9 billion, down BRL 1.2 billion from 2024 primarily due to slower monetization of tax credits.

2Strategic Updates and Business Highlights

Share Buyback Program: The Board approved a BRL 2.5 billion share buyback program aimed at canceling shares to return cash to shareholders.

Brand Performance: Premium and super premium brands grew over 9%, with the Balanced Choices portfolio expanding by 36%.

Digital Ecosystem: BEES Marketplace achieved a 100% GMV growth to an annualized BRL 8 billion, while Zé Delivery saw a 7% increase in GMV.

Cost Management: Successful cost initiatives led to cash COGS per hectoliter growing below net revenue per hectoliter.

3Forward Guidance and Outlook

The company remains confident in its ability to achieve its cash COGS per hectoliter guidance of 5.5% to 7%.

Anticipates a solid finish to 2025, leveraging the upcoming FIFA World Cup to drive beer consumption.

Management expressed optimism about long-term growth despite current industry challenges.

4Bad News, Challenges, or Points of Concern

Industry Volume Decline: Softer than expected industry volumes in Brazil, attributed to weather conditions and reduced consumer purchasing power, particularly affecting out-of-home consumption.

Regional Disparities: Volume performance varied significantly between regions, with the South and Southeast experiencing more significant declines due to colder weather.

Competitive Pressures: The company noted challenges in maintaining market share in the non-alcoholic beverage segment, where volumes declined despite stable market share year-to-date.

5Notable Q&A Insights

COGS Management: CFO Fleury emphasized that the lower COGS was due to a combination of initiatives rather than a single factor, highlighting the company's disciplined approach to cost management.

Consumer Behavior: CEO Lisboa noted that while the weather and economic factors impacted consumption occasions, underlying consumer engagement remains solid.

Pricing Strategy: Lisboa clarified that the recent price increases had minimal impact on volume performance, as prices were still below inflation, and emphasized the importance of maintaining accessibility for consumers.

Market Dynamics: The discussion highlighted the contrasting performance in beer and non-alcoholic beverage segments, with the latter facing more significant challenges due to inventory management and competitive dynamics. Overall, Ambev's Q3 2025 results reflect a resilient business model amid challenging market conditions, with strategic initiatives aimed at long-term growth and profitability.