TIMS3 after 2Q26: postpaid scale and Ultrafibra lift EBITDA while M&A and financial lines complicate the YoY bridge

On 27 July 2026, TIM S.A. (B3: TIMS3; NYSE: TIMB) published 2Q26 results for the period ended 30 June 2026. Net revenue reached R$ 6.97 billion (+5.5% year on year), normalized EBITDA rose 7.0% to R$ 3.59 billion with a 51.5% margin (+0.7 percentage points), and normalized net income hit R$ 1.04 billion (+6.2%) — a record for a second quarter, according to the company.

The quarter is a useful contrast with other Brazilian telecom write-ups on this blog (for example VIVT3): TIM is smaller in revenue but pushing the same strategic levers — postpaid mix, fiber, B2B diversification — while consolidating acquisitions (I-Systems, V8.Tech) and absorbing a financial result that looks worse year on year mostly because 2Q25 benefited from one-off positives.

Consolidated snapshot

Figures below follow TIM's 2Q26 earnings release (27 July 2026) unless noted:

In 1H26, service revenue grew 6.1% and normalized EBITDA-AL 7.8%, with EBITDA-AL margin at 38.7% (+0.6 pp year on year).

Revenue — mobile resilience, fiber acceleration, B2B layers

Service revenue growth was broad-based:

Postpaid remains the anchor: +5.8% revenue year on year, with the base up 6.8% and postpaid representing about 70% of mobile service revenue. Postpaid ex-M2M ARPU was R$ 55.7 (+0.7%). Prepaid revenue fell 6.9% as the base shrank 8.0%, though management described prepaid as stabilizing quarter on quarter.

Group mobile ARPU reached R$ 34.3 (+5.0%), helped by postpaid mix and ancillary revenue streams rather than a uniform price lift across prepaid.

TIM Ultrafibra added 12.5% customers year on year to 899 thousand; FTTH revenue rose 9.5% with FTTH ARPU at R$ 92.8 (+0.8%). Fixed service revenue also reflects V8.Tech consolidation into the fixed segment after the deal closed in 1Q26.

B2B (ex-wholesale) remains a growth vector: +16.6% on a last-twelve-month basis to R$ 1.7 billion, about 6.6% of total service revenue. New B2B project signings reached R$ 192 million in 2Q26, described as a series high.

Subscribers, churn, and share — growth with friction

Operational KPIs from the SEC earnings release show a mixed mobile picture:

Ultrafibra scale (899k clients, 896k on FTTH) is growing faster than the mobile base is shrinking, which matches the strategic narrative: monetize through mix and ARPU, add fiber and B2B, and accept a competitive mobile market (Mother's Day and FIFA World Cup activity cited in the release).

Costs, normalization, and EBITDA

Normalized operating costs rose 4.0% to R$ 3.38 billion — below IPCA over twelve months to June 2026 (4.64% per IBGE, as cited by TIM). Key lines:

• Personnel +7.3% — largely V8.Tech and I-Systems; ex-acquisitions, personnel costs would have fallen 1.5%, per the release.
• Bad debt provisions +38.1% — one wholesale/B2B client plus postpaid base growth.
• Network and interconnection +3.2% — slower growth, helped by lower international roaming and partial elimination of I-Systems rent for two months.

Normalized EBITDA bridges include non-recurring operating items (for example I-Systems purchase-price adjustment R$ 56.3 million in 2Q26). The educational habit is the same as in other Brazilian issuer posts: read the footnote table before treating reported and normalized margins as interchangeable.

EBITDA after leases (EBITDA-AL) expanded 7.8% as lease expense growth stayed contained, supported by RAN sharing renegotiations and active lease management — relevant for any screen that compares TIM to peers on headline EBITDA without lease harmonization.

Below EBITDA — financial result and tax timing

Normalized net financial expense was R$ 569 million (+51.8% year on year). The release attributes most of the swing to a tougher comparison in 2Q25, when TIM recognized:

• R$ 119 million from a civil contingency update after a favorable STF decision (per ITR Note 24); and
• R$ 76 million from the 5G fund versus R$ 15 million in 2Q26.

2Q26 also carried higher lease interest and I-Systems consolidation effects (R$ 13 million). Depreciation and amortization rose only 1.1% year on year despite M&A — described as controlled relative to capex.

Normalized income tax was a R$ 168 million benefit (effective rate −13.9%) versus R$ 199 million in 2Q25, partly because JCP declared in the quarter was R$ 400 million (R$ 300 million in 2Q25). That is why normalized net income can grow 6.2% while reported net income slips 0.6% to R$ 970 million — different lines, different adjustments.

Cash, capex, and leverage

TIM defines operating cash flow (OpCF) as normalized EBITDA-AL minus capex. On that basis, OpCF was R$ 1.87 billion (+8.7%), margin 26.8%.

Free operating cash flow (FCOL) — after working capital, income taxes, and lease payments per the release bridge — reached R$ 1.24 billion (+10.1%). Working capital helped via accounts receivable; tax payments and lease cash outflows partially offset the operating improvement.

Capex of R$ 935 million (13.4% of net revenue) tilted toward network (R$ 647 million) and IT (R$ 288 million), including fiber integration after I-Systems.

Cash and securities ended at R$ 4.53 billion (−17.2% year on year), reflecting the I-Systems buyout, 2025 dividend acceleration paid in December 2025, and debenture amortization. Total net debt was R$ 12.52 billion; net debt / normalized EBITDA 0.89x. Net debt after leases was R$ 1.10 billion with net debt AL / EBITDA AL near −0.10x on the company's 12-month EBITDA AL after lease payments definition — a different lens from the 0.89x gross-leverage headline.

Shareholder remuneration and corporate actions

TIM reiterated 2026 shareholder distribution guidance of R$ 5.3–5.5 billion. On 17 June 2026, the board approved R$ 400 million of interest on equity (JCP). In July 2026, the board authorized capital injections of up to R$ 600 million into I-Systems and R$ 70 million into V8.Tech to prepay subsidiary debt and reduce group financial cost — no change to TIM S.A.'s share count or ownership percentages, per the release.

Limits of this reading

• Normalized metrics exclude specific non-recurring items listed in the release; reported profit and EBITDA are not redundant with normalized lines.
• OpCF and FCOL are company definitions; they are not interchangeable with third-party free cash flow screens.
• M&A consolidation (I-Systems, V8.Tech) affects costs, D&A, and financial expense with partial-quarter effects in 2Q26.
• Market share and churn come from TIM's investor KPI deck; regulatory market statistics may differ slightly by methodology.
• Fistel principal and moratory interest (R$ 4.8 billion recorded through June 2026, payment suspended since 2020) are a long-dated regulatory liability — material for full balance-sheet work, not fully unpacked in a press release.

Where to view in the explorer

• TIMS3 — TIM S.A.
• VIVT3 — Telefônica Brasil (peer context)
• Company list
• Blog

Sources

• TIM S.A. — Release de Resultados 2T26 (reference 30 Jun 2026), 27 Jul 2026
• TIM S.A. — Form 6-K and earnings release (SEC EDGAR), filed 27 Jul 2026
• TIMS3 on the explorer — CVM filings and company page

Disclaimer

This article is for informational and educational purposes only. It is not investment advice. Normalized EBITDA, EBITDA-AL, operating cash flow, and free operating cash flow follow TIM's release definitions; when in doubt, the official CVM ITR and 6-K prevail. Refer to those documents and, if needed, a licensed professional.