May 7 (Bloomberg) -- Telefonica Brasil SA, the nation’s largest phone company by revenue, fell the most since November after reporting that profit missed estimates as revenue from fixed services slumped because of increased competition.
The Sao Paulo-based company, also known as Vivo, retreated 3.2 percent to 52.40 reais at the close of trading, the steepest one-day drop since Nov. 26. It was the worst performance in the benchmark Ibovespa, which rose 1.5 percent.
First-quarter adjusted net income was 810.2 million reais ($402.8 million), according to data compiled by Bloomberg after the company reported earnings before trading today. The average estimate of nine analysts was for a profit of 949.9 million.
The result below forecasts “was attributable to struggling landline business, whose deterioration accelerated whereas we expected slight improvement,” Luis Azevedo and Tales Freire, analysts at Banco Bradesco SA’s brokerage unit, wrote in a note to clients today.
Revenue from fixed services such as phone, Internet and cable television declined 8.9 percent to 2.9 billion reais in the three months through March from a year earlier, Telefonica said in a regulatory filing. The company cited tougher competition because of bundled promotions. The decline was 3.1 percent in the fourth quarter.
The stock has gained 6.9 percent this year, compared with the Ibovespa’s 7.7 percent decline. Vivo is the brand under which Telefonica is reorganizing its mobile, fixed-line, cable television and Internet services.
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